| **UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 10-QSB**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    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                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 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| (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**

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

For the transition period from ____________ to _____________

 

Commission File Number: 333-124060

 

**RX STAFFING, INC.**

(Exact name of registrant as specified in its charter)

 

Nevada

20-1977020

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

 

 

1718 Fawn Court N.W.

Gig Harbor, Washington

98332

(Address of principal executive offices)

(Zip Code)

 

 

(253) 720-0022

(Registrant’s telephone number, including area code)

 

N/A

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

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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 o

 

**APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS:**

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.

Yes o No o

 

**APPLICABLE ONLY TO CORPORATE ISSUERS:**

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 10,500,000

 

 

 

 

 

**RX STAFFING, INC.**

**(A Development Stage Company)**

 

**Table of Contents**

 

 

**Page**

 

PART I – FINANCIAL INFORMATION

3

Unaudited Condensed Financial Statements

4

Management’s Discussion and Plan of Operation

15

Controls and Procedures

17

PART II – OTHER INFORMATION

17

Use of Proceeds

17

Exhibits and Reports on Form 10-QSB

18

SIGNATURES

19

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2

 

 

 

**PART I – FINANCIAL INFORMATION**

 

**Unaudited Financial Statements**

 

The accompanying unaudited condensed financial statements have been prepared in accordance with generally accepted accounting principles for interim financial reporting and pursuant to the rules and regulations of the Securities and Exchange Commission (“Commission”). While these statements reflect all normal recurring adjustments which are, in the opinion of management, necessary for fair presentation of the results of the interim period, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. For further information, refer to the financial statements and footnotes thereto, which are included in the Company’s annual report for the year ended December 31, 2005 on Form 10-KSB previously filed with the Commission on March 6, 2006, and subsequent amendments made thereto.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3

 

 

 

**Rx STAFFING, INC.**

**(A DEVELOPMENT STAGE COMPANY)**

**CONDENSED BALANCE SHEET**

**JUNE 30, 2006**

**(UNAUDITED)**

 

 

**ASSETS**

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current Asset:

 

 

 

 

Cash and cash equivalents

 

$

8,260

 

 

 

 

 

 

Total Current Asset

 

 

8,260

 

 

 

 

 

 

Fixed asets, net of depreciation

 

 

3,435

 

 

 

 

 

 

**TOTAL ASSETS**

 

$

11,695

 

 

 

 

 

 

**LIABILITY AND STOCKHOLDER’S EQUITY**

 

 

 

 

 

 

 

 

 

**LIABILITY**

 

 

 

 

Current Liability:

 

 

 

 

Accounts payable

 

$

—

 

 

 

 

 

 

Total Current Liability

 

 

—

 

 

 

 

 

 

**Total Liability**

 

 

—

 

 

 

 

 

 

**STOCKHOLDER’S EQUITY**

 

 

 

 

Common stock, $.001 Par Value; 100,000,000 shares authorized;

 

 

 

 

10,500,000 shares issued and outstanding

 

 

10,500

 

Additional paid-in capital

 

 

24,500

 

Deficit accumulated during the development stage

 

 

(23,305

)

 

 

 

 

 

**Total Stockholder’s Equity**

 

 

11,695

 

 

 

 

 

 

**TOTAL LIABILITY AND STOCKHOLDER’S EQUITY**

 

$

11,695

 

 

 

 

 

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

 

 

4

 

 

 

**Rx STAFFING, INC.**

**(A DEVELOPMENT STAGE COMPANY)**

**CONDENSED STATEMENTS OF OPERATIONS**

**FOR THE SIX AND THREE MONTHS ENDED JUNE 30, 2006 AND 2005**

**(WITH CUMULATIVE TOTALS SINCE INCEPTION)**

**(UNAUDITED)**

 

 

 

 

 

 

 

**Cumulative Totals**

 

 

 

**For the six months ended**

 

**For the three months ended**

 

**December 6, 2004 (inception)**

 

 

 

**June 30, 2006**

 

**June 30, 2005**

 

**June 30, 2006**

 

**June 30, 2005**

 

**through June 30, 2006**

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

**OPERATING REVENUES**

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales

 

$

—

 

$

—

 

$

—

 

$

—

 

$

3,115

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

**COST OF SALES**

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

**GROSS PROFIT**

 

 

—

 

 

—

 

 

—

 

 

—

 

 

3,115

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

**OPERATING EXPENSES**

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Outside Services

 

 

7,250

 

 

879

 

 

7,150

 

 

879

 

 

15,382

 

Professional fees

 

 

3,477

 

 

2,702

 

 

101

 

 

336

 

 

9,882

 

General and administrative expenses

 

 

622

 

 

174

 

 

300

 

 

15

 

 

1,057

 

Depreciation and amortization

 

 

99

 

 

—

 

 

99

 

 

—

 

 

99

 

**Total Operating Expenses**

 

 

11,448

 

 

3,755

 

 

7,650

 

 

1,230

 

 

26,420

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

**NET LOSS BEFORE PROVISION FOR INCOME TAXES**

 

 

(11,448

)

 

(3,755

)

 

(7,650

)

 

(1,230

)

 

(23,305

)

Provision for income taxes

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

**NET LOSS APPLICABLE TO COMMON SHARES**

 

$

 (11,448

)

$

 (3,755

)

$

 (7,650

)

$

 (1,230

)

$

 (23,305

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

**BASIC AND DILUTED LOSS PER SHARE**

 

$

 (0.00

)

$

 (0.00

)

$

)0.00)

 

$

 (0.00

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

**WEIGHTED AVERAGE COMMON SHARES**

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

**OUTSTANDING**

 

 

10,500,000

 

 

10,000,000

 

 

10,500,000

 

 

10,000,000

 

 

 

 

 

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

 

 

5

 

 

 

**Rx STAFFING, INC.**

**(A DEVELOPMENT STAGE COMPANY)**

**CONDENSED STATEMENTS OF CASH FLOWS**

**FOR THE SIX MONTHS ENDED JUNE 30, 2006 AND 2005**

**(WITH CUMULATIVE TOTALS SINCE INCEPTION)**

**(UNAUDITED)**

 

 

 

 

 

 

 

**Cumulative Totals**

 

 

 

 

 

 

 

**December 6, 2004 (inception)**

 

 

 

**2006**

 

**2005**

 

**through June 30, 2006**

 

**CASH FLOWS FROM OPERATING ACTIVITIES**

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

 (11,448

)

$

 (3,755

)

$

 (23,305

)

 

 

 

 

 

 

 

 

 

 

 

Adjustments to reconcile net loss to net (loss) cash 

 

 

 

 

 

 

 

 

 

 

(used in) operating activities

 

 

 

 

 

 

 

 

 

 

Depreciation

 

 

99

 

 

—

 

 

99

 

 

 

 

 

 

 

 

 

 

 

 

**Changes in assets and liabilities**

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total adjustments

 

 

99

 

 

—

 

 

99

 

 

 

 

 

 

 

 

 

 

 

 

**Net cash (used in) operating activities**

 

 

(11,349

)

 

(3,755

)

 

(23,206

)

 

 

 

 

 

 

 

 

 

 

 

**CASH FLOWS FROM INVESTING ACTIVITIES**

 

 

 

 

 

 

 

 

 

 

Acquisitions of fixed assets

 

 

(3,534

)

 

—

 

 

(3,534

)

 

 

 

 

 

 

 

 

 

 

 

**Net cash (used in) operating activities**

 

 

(3,534

)

 

—

 

 

(3,534

)

**CASH FLOWS FROM FINANCING ACTIVITIES**

 

 

 

 

 

 

 

 

 

 

Issuance of common stock

 

 

—

 

 

10,000

 

 

35,000

 

 

 

 

 

 

 

 

 

 

 

 

**Net cash provided by financing activities**

 

 

—

 

 

10,000

 

 

35,000

 

 

 

 

 

 

 

 

 

 

 

 

**NET INCREASE (DECREASE)  IN**

 

 

 

 

 

 

 

 

 

 

**CASH AND CASH EQUIVALENTS**

 

 

(14,883

)

 

6,245

 

 

8,260

 

 

 

 

 

 

 

 

 

 

 

 

**CASH AND CASH EQUIVALENTS -**

 

 

 

 

 

 

 

 

 

 

**BEGINNING OF PERIOD**

 

 

23,143

 

 

—

 

 

—

 

 

 

 

 

 

 

 

 

 

 

 

**CASH AND CASH EQUIVALENTS – END OF PERIOD**

 

$

8,260

 

$

6,245

 

$

8,260

 

 

 

 

 

 

 

 

 

 

 

 

**SUPPLEMENTAL CASH FLOW INFORMATION:**

 

 

 

 

 

 

 

 

 

 

During the period, cash was paid for the following:

 

 

 

 

 

 

 

 

 

 

Income taxes

 

$

—

 

$

—

 

$

—

 

Interest

 

$

—

 

$

—

 

$

—

 

 

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

 

6

 

 

 

**Rx STAFFING, INC.**

**(A DEVELOPMENT STAGE COMPANY)**

**NOTES TO CONDENSED FINANCIAL STATEMENTS**

**JUNE 30, 2006 AND 2005**

**(UNAUDITED)**

 

**NOTE 1 -**

**ORGANIZATION AND BASIS OF PRESENTATION**

 

The condensed unaudited interim financial statements included herein have been prepared by Rx Staffing, Inc. (“the Company”) without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). The condensed financial statements and notes are presented as permitted on Form 10-QSB and do not contain information included in the Company’s annual statements and notes. Certain information and footnote disclosures normally included in the financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted as allowed by such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. It is suggested that these condensed unaudited financial statements be read in conjunctionwith the December 31, 2005 audited financial statements and the accompanying notes thereto. While management believes the procedures followed in preparing these condensed financial statements are reasonable, the accuracy of the amounts are in some respects dependent upon the facts that will exist, and procedures that will be accomplished by the Company later in the year.

 

The management of the Company believes that the accompanying unaudited condensed financial statements reflect all adjustments (including normal recurring adjustments) necessary to present fairly the operations and cash flows for the periods presented.

 

Rx Staffing, Inc. (the “Company”), a development stage company, was incorporated in the State of Nevada on December 6, 2004. Rx Staffing, Inc., plans to become a full-service temporary personnel agency providing temporary medical staff to hospitals, clinics and nursing homes. 

 

 

 

 

 

 

 

7

 

 

 

**Rx STAFFING, INC.**

**(A DEVELOPMENT STAGE COMPANY)**

**NOTES TO CONDENSED FINANCIAL STATEMENTS (CONTINUED)**

**JUNE 30, 2006 AND 2005**

**(UNAUDITED)**

 

**NOTE 2 -**

**SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

 

**Development Stage Company**

 

The Company is considered to be in the development stage as defined in Statement of Financial Accounting Standards (SFAS) No. 7, “Accounting and Reporting by Development Stage Enterprises”. The Company has devoted substantially all of its efforts to business planning, research and development. Additionally, the Company has allocated a substantial portion of their time and investment in bringing their product to the market, and the raising of capital.

 

**Use of Estimates**

 

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

 

**Cash and Cash Equivalents**

 

For financial statement presentation purposes, the Company considers short-term, highly liquid investments with original maturities of three months or less to be cash and cash equivalents. 

 

The Company maintains cash and cash equivalent balances at a financial institution that is insured by the Federal Deposit Insurance Corporation up to $100,000.

 

 

 

 

 

 

 

 

8

 

 

 

**Rx STAFFING, INC.**

**(A DEVELOPMENT STAGE COMPANY)**

**NOTES TO CONDENSED FINANCIAL STATEMENTS (CONTINUED)**

**JUNE 30, 2006 AND 2005**

**(UNAUDITED)**

 

**NOTE 2 -**

**SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES****(CONTINUED)**

 

**Revenue Recognition**

 

The Company’s financial statements are prepared under the accrual method of accounting. Revenues will be recognized in the period the services are performed and costs are recorded in the period incurred rather than paid.

 

**Fair Value of Financial Instruments**

 

The Company’s financial instruments are all carried at amounts that approximate their estimated fair value as of June 30, 2006.

 

**Income Taxes**

 

The provision for income taxes includes the tax effects of transactions reported in the financial statements. Deferred taxes would be recognized for differences between the basis for assets and liabilities for financial statement and income tax purposes. The major difference relate to the net operating loss carryforwards generated by sustaining deficits during the development stage**.**

 

**Advertising Costs**

 

Advertising and promotions costs are expensed as incurred. The Company incurred no such expenses since inception.

 

 

 

 

 

 

 

 

9

 

 

 

**Rx STAFFING, INC.**

**(A DEVELOPMENT STAGE COMPANY)**

**NOTES TO CONDENSED FINANCIAL STATEMENTS (CONTINUED)**

**JUNE 30, 2006 AND 2005**

**(UNAUDITED)**

 

**NOTE 2 -**

**SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)**

 

**Recent Accounting Pronouncements**

 

**Share Based Payments**

 

In December 2004, the FASB issued Financial Accounting Standards No. 123 (revised 2004) (FAS 123R), “Share-Based Payment, “FAS 123R replaces FAS No. 123, “Accounting for Stock-Based Compensation”, and supersedes APB Opinion No. 25, “Accounting for Stock Issued to Employees.” FAS 123R requires compensation expense, measured as the fair value at the grant date, related to share-based payment transactions to be recognized in the financial statements over the period that an employee provides service in exchange for the award. The Company intends to adopt FAS 123R using the “modified prospective” transition method as defined in FAS 123R. Under the modified prospective method, companies are required to record compensation cost prospectively for the unvested portion, as of the date of adoption, of previously issued and outstanding awards over theremaining vesting period of such awards. FAS 123R is effective January 1, 2006. The implementation of this standard did not have a material impact on its financial position, results of operations or cash flows.

 

In May 2005, the FASB issued FAS No. 154, “Accounting Changes and Error Corrections.” FAS No. 154 replaces Accounting Principles Board (“APB”) Opinion No. 20, “Accounting Changes” and FAS No. 3, “Reporting Accounting Changes in Interim Financial Statements.” FAS No. 154 requires retrospective application to prior periods’ financial statements of a voluntary change in accounting principle unless it is impracticable. APB No. 20 previously required that most voluntary changes in accounting principle be recognized by including the cumulative effect of changing to the new accounting principle in net income in the period of the change. FAS No. 154 is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005. The adoption of FAS No. 154 did nothave a material impact on the Company’s financial position or results of operations.

 

In February 2006, the FASB issued FAS No. 155, “Accounting for Certain Hybrid Financial Instruments, an amendment of FASB Statements No. 133 and 140.” FAS No. 155 resolves issues addressed in FAS No. 133 Implementation Issue No. D1, “Application of Statement 133 to Beneficial Interests in Securitized Financial Assets,” and permits fair value remeasurement for any hybrid financial instrument that contains an embedded derivative that otherwise would require bifurcation, clarifies

 

 

 

 

 

 

 

10

 

 

 

**Rx STAFFING, INC.**

**(A DEVELOPMENT STAGE COMPANY)**

**NOTES TO CONDENSED FINANCIAL STATEMENTS (CONTINUED)**

**JUNE 30, 2006 AND 2005**

**(UNAUDITED)**

 

**NOTE 2 -**

**SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)**

 

which interest-only strips and principal-only strips are not subject to the requirements of FAS No. 133, establishes a requirement to evaluate interests in securitized financial assets to identify interests that are freestanding derivatives or that are hybrid financial instruments that contain an embedded derivative requiring bifurcation, clarifies that concentrations of credit risk in the form of subordination are not embedded derivatives and amends FAS No. 140 to eliminate the prohibition on a qualifying special-purpose entity from holding a derivative financial instrument that pertains to a beneficial interest other than another derivative financial instrument. FAS No. 155 is effective for all financial instruments acquired or issued after the beginning of the first fiscal year that begins after September 15, 2006. The Company is currently evaluating the effect theadoption of FAS No. 155 but believes it will not have a material impact on its financial position or results of operations.

 

In March 2006, the FASB issued FAS No. 156, “Accounting for Servicing of Financial Assets, an amendment of FASB Statement No. 140.” FAS No. 156 requires an entity to recognize a servicing asset or liability each time it undertakes an obligation to service a financial asset by entering into a servicing contract under a transfer of the servicer’s financial assets that meets the requirements for sale accounting, a transfer of the servicer’s financial assets to a qualified special-purpose entity in a guaranteed mortgage securitization in which the transferor retains all of the resulting securities and classifies them as either available-for-sale or trading securities in accordance with FAS No. 115, “Accounting for Certain Investments in Debt and Equity Securities” and an acquisition or assumption of an obligation to service a financialasset that does not relate to financial assets of the servicer or its consolidated affiliates. Additionally, FAS No. 156 requires all separately recognized servicing assets and servicing liabilities to be initially measured at fair value, permits an entity to choose either the use of an amortization or fair value method for subsequent measurements, permits at initial adoption a one-time reclassification of available-for-sale securities to trading securities by entities with recognized servicing rights and requires separate presentation of servicing assets and liabilities subsequently measured at fair value and additional disclosures for all separately recognized servicing assets and liabilities. FAS No. 156 is effective for transactions entered into after the beginning of the first fiscal year that begins after September 15, 2006. The Company is currently evaluating the effect the adoption of FAS No. 156 but believes it will not have a material impact on itsfinancial position or results of operations.

 

 

 

 

 

 

 

11

 

 

 

**Rx STAFFING, INC.**

**(A DEVELOPMENT STAGE COMPANY)**

**NOTES TO CONDENSED FINANCIAL STATEMENTS (CONTINUED)**

**JUNE 30, 2006 AND 2005**

**(UNAUDITED)**

 

 

**NOTE 2 -**

**SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)**

 

 

**Net (Loss) Per Share of Common Stock**

 

**The following table sets forth the computation of basic and diluted earnings per share:**

 

 

 

 

**Six Months Ended**

 

 

 

**June 30, 2006**

 

**June 30, 2005**

 

 

 

 

 

 

 

 

 

Net loss

 

$

 (11,448

)

$

 (3,755

)

 

 

 

 

 

 

 

 

Weighted average common shares outstanding (Basic)

 

 

10,500,000

 

 

10,000,000

 

 

 

 

 

 

 

 

 

Options

 

 

—

 

 

—

 

Warrants

 

 

—

 

 

—

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding (Diluted)

 

 

10,500,000

 

 

10,000,000

 

 

 

There are no common stock equivalents outstanding at June 30, 2006 and 2005.

 

Historical net (loss) per common share is computed using the weighted average number of common shares outstanding. Diluted earnings per share (EPS) include additional dilution from common stock equivalents, such as stock issuable pursuant to the exercise of stock options and warrants. 

 

All dilutive securities were not included in the calculation of dilutive earnings per share because the effect would be anti-dilutive when the Company has incurred a loss from operations. The Company currently has no potentially dilutive securities outstanding.

 

 

 

 

 

 

12

 

 

 

 

**Rx STAFFING, INC.**

**(A DEVELOPMENT STAGE COMPANY)**

**NOTES TO CONDENSED FINANCIAL STATEMENTS (CONTINUED)**

**JUNE 30, 2006 AND 2005**

**(UNAUDITED)**

 

 

**NOTE 3 -**

**STOCKHOLDERS’ EQUITY**

 

On December 6, 2004 the Company was formed with one class of common stock, par value $.001. The Company authorized 100,000,000 shares of common stock.

 

On January 21, 2005, the Company issued 10,000,000 shares of stock to its director for cash of  $10,000.

 

In October 2005, the Company issued 500,000 shares of stock for cash of $25,000.

 

 

**NOTE 4 -**

**GOING CONCERN**

 

As shown in the accompanying financial statements, as is typical of companies going through the development stage, the Company incurred no activity since inception other than the issuance of stock for the period December 6, 2004 (Inception) through June 30, 2006. The Company is currently in the development stage, and there is no guarantee whether the Company will be able to generate enough revenue and/or raise capital to support current operations and generate anticipated sales. This raises substantial doubt about the Company’s ability to continue as a going concern.              

 

Management believes that the Company’s capital requirements will depend on many factors including the success of the Company’s service development efforts. Management’s plans include marketing of their services and establishment of key management personnel to support the business plan. With the business plan being followed, Management believes along with working capital being raised that the operations and sales will make the Company a viable entity over the next twelve months.

 

The financial statements do not include any adjustments relating to the recoverability or classification of recorded assets and liabilities that might result should the Company be unable to continue as a going concern.

 

 

 

 

 

 

 

 

13

 

 

 

**Rx STAFFING, INC.**

**(A DEVELOPMENT STAGE COMPANY)**

**NOTES TO CONDENSED FINANCIAL STATEMENTS (CONTINUED)**

**JUNE 30, 2006 AND 2005**

**(UNAUDITED)**

 

**NOTE 5 -**

**PROVISION FOR INCOME TAXES**

 

Deferred income taxes will be determined using the liability method for the temporary differences between the financial reporting basis and income tax basis of the Company’s assets and liabilities. Deferred income taxes will be measured based on the tax rates expected to be in effect when the temporary differences are included in the Company’s tax return. Deferred tax assets and liabilities are recognized based on anticipated future tax consequences attributable to differences between financial statement carrying amounts of assets and liabilities and their respective tax bases.

 

At June 30, 2006 and 2005, deferred tax assets consist of the following:

 

 

 

 

**June 30, 2006**

 

**June 30, 2005**

 

 

 

 

 

 

 

 

 

Deferred tax assets

 

$

6,992

 

$

1,127

 

Less: valuation allowance

 

 

(6,992

)

 

(1,127

)

Net deferred tax assets

 

$

—

 

$

—

 

 

 

At June 30, 2006 and 2005, the Company had accumulated deficits during the development stage of $23,305 and $3,755 available to offset future taxable income through 2026. The Company established valuation allowances equal to the full amount of the deferred tax assets due to the uncertainty of the utilization of the operating losses in future periods.

 

 

 

 

 

 

 

 

 

 

14

 

 

 

**Management’s Discussion and Plan of Operation**

 

*Forward-Looking Statements*

 

This Quarterly Report contains forward-looking statements about Rx Staffing, Inc.’s business, financial condition and prospects that reflect management’s assumptions and beliefs based on information currently available. We can give no assurance that the expectations indicated by such forward-looking statements will be realized. If any of our management’s assumptions should prove incorrect, or if any of the risks and uncertainties underlying such expectations should materialize, RSI’s actual results may differ materially from those indicated by the forward-looking statements.

 

The key factors that are not within our control and that may have a direct bearing on operating results include, but are not limited to, acceptance of our services, our ability to expand our customer base, managements’ ability to raise capital in the future, the retention of key employees and changes in the regulation of our industry.

 

There may be other risks and circumstances that management may be unable to predict. When used in this Quarterly Report, words such as,  *”believes,”*  *”expects,” “intends,”*  *”plans,”*  *”anticipates,”*  *”estimates”*and similar expressions are intended to identify forward-looking statements, although there may be certain forward-looking statements not accompanied by such expressions.

 

*Management’s Discussion and Plan of Operation*

 

We were incorporated on December 6, 2004, and have begun our planned principal operations. Our efforts to date have focused primarily on formation and organization of our company and the development and implementation of our business plan.

 

During the three and six months ended June 30, 2006 and 2005, we did not generate any revenues. Since our inception through June 30, 2006, we generated a total of $3,115 in revenues from sales of our medical staffing services. We do not have any long-term agreements to provide our services to any customer. As a result, we are unable to predict the stability of, and ability to continue to generate, ongoing revenues.

 

For the three months ended June 30, 2006, we incurred expenses in our continued pursuit of our stated business objective to provide temporary medical employment services in the amount of $7,650, consisting of $101 in professional fees, $300 in general and administrative expenses, $7,150 in outside services, and $99 in depreciation and amortization. We incurred expenses in the amount of $1,230 during the three months ended June 30, 2005, consisting of $336 in professional fees, $879 in outside services, and $15 in general and administrative fees. Management believes that the increase in expenditures can be ascribed to the implementation and execution of our business plan. Total expenses since our inception on December 6, 2004 to June 30, 2006 were $26,420, of which $9,882 is attributable to professional fees, $15,382 in outside services, $99 in depreciation and amortization, and $1,057 ingeneral and administrative expenses. We expect to continue to incur various expenses for the foreseeable future, although we cannot estimate the extent of these costs. As we continue to pursue establishing our base of operations, we expect aggregate expenses to increase.

 

As a result of our expenses and minimal revenues, we have incurred net losses since our inception. For the three months ended June 30, 2006, our net losses were $7,650. During the three months ended June 30, 2005, we incurred net losses in the amount of $1,230. From the date of our inception to June 30, 2006, we had a cumulative deficit of $23,305. We expect to incur ongoing losses for the next 12 months of operations unless we are able to increase our revenue generating ability significantly. Our independent registered public accountants have expressed substantial doubt about our ability to continue as a going concern as footnoted in the financial statements. If our business fails, our investors may face a complete loss of their investment.

 

We believe that our cash on hand as of June 30, 2006 of $8,260 is not sufficient to continue operations for the next 12 months without generating revenues or obtaining additional capital infusions. We cannot assure that any financing can be obtained or, if obtained, that it will be on reasonable terms. Without realization of additional capital, it would be unlikely for us to continue as a going concern. Since our incorporation, we have raised capital via the issuance of our common equity in exchange for cash. All told, we raised $35,000 in cash. In January 2005, we issued 10,000,000 shares of our common stock to Shaun M. Jones, our sole officer and director, in exchange for cash in the amount of $10,000. On October 25, 2005, we sold an aggregate of 500,000 shares of our common stock in an offering made under Regulation SB-2 to 20 individuals for cash in the amount of $25,000.

 

15

 

 

 

Generating sales in the next 6 to 12 months is important to support our planned ongoing operations. However, we cannot guarantee that we will generate such growth. If we do not generate sufficient cash flow to support our operations over the next 12 to 18 months, we may need to raise additional capital by issuing capital stock in exchange for cash in order to continue as a going concern. We currently do not have any recurring financial obligations that require immediate capital to finance. However, we expect to have negative cash flows for the remainder of fiscal year 2006. In addition, if our costs of operations increase unexpectedly, we may need to raise additional capital by issuing equity or debt securities in exchange for cash. There can be no assurance that we will be able to secure additional funds in the future to stay in business. 

 

There are no known trends, events or uncertainties that have had or that are reasonably expected to have a material impact on our revenues from continuing operations. Additionally, we do not believe that our business is subject to seasonal factors. Our management does not expect to incur costs related to research and development. We currently do not own any significant plant or equipment that we would seek to sell in the near future. 

Our management does not anticipate the need to hire additional full- or part- time employees over the next 12 months, as the services provided by our officer and director appears sufficient at this time. We believe that our operations are currently on a small scale that is manageable by a single individual. Our management’s responsibilities are mainly administrative at this early stage. While we believe that the addition of employees is not required over the next 12 months, the healthcare professionals we plan to represent will be considered independent contractors. We do not intend to enter into any employment agreements with any of these professionals. Thus, these persons are not intended to be employees of our company.

RSI does not have any off-balance sheet arrangements.

 

We have not paid for expenses on behalf of any of our directors. Additionally, we believe that this fact shall not materially change.

 

 

 

 

 

 

 

 

16

 

 

 

**Controls and Procedures**

 

We maintain a set of disclosure controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act, is recorded, processed, summarized and reported within the time periods specified by the SEC’s rules and forms. Disclosure controls are also designed with the objective of ensuring that this information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure.

 

Based upon their evaluation as of the end of the period covered by this report, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures are not effective to ensure that information required to be included in our periodic SEC filings is recorded, processed, summarized, and reported within the time periods specified in the SEC rules and forms.

 

Our board of directors was advised by Bagell, Josephs & Company, L.L.C., our independent registered public accounting firm, that during their performance of audit procedures for 2005 Bagell, Josephs & Company, L.L.C. identified a material weakness as defined in Public Company Accounting Oversight Board Standard No. 2 in our internal control over financial reporting.

 

This deficiency consisted primarily of inadequate staffing and supervision that could lead to the untimely identification and resolution of accounting and disclosure matters and failure to perform timely and effective reviews. However, our size prevents us from being able to employ sufficient resources to enable us to have adequate segregation of duties within our internal control system. Management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

 

**PART II – OTHER INFORMATION**

 

**Use of Proceeds**

 

The SB-2 Registration Statement, as amended (SEC File Number 333-125686), filed by RSI and deemed effective by the Securities and Exchange Commission as of June 15, 2005, offered a minimum of 500,000 and a maximum of 2,000,000 shares of our $0.001 par value common stock at a price of $0.05 per share pursuant to a self-underwritten offering. A total of 500,000 shares were sold to twenty-five investors in conjunction with the registered offering for proceeds of $25,000. On November 3, 2005, we closed the offering and subsequently filed a Post-Effective Amendment to deregister 1,500,000 shares representing the unsold portion of the stock offered by Rx Staffing.

 

Since the close of the offering, the actual uses of the proceeds from the offering used for working capital, or for which at least five percent of the total proceeds has been used, were as follows:

 

**Item**

 

**Amount**

 

 

 

 

 

 

**Use of Net Proceeds:**

 

 

 

 

Accounting fees

 

$

3,078

 

Legal and professional fees

 

 

7,824

 

Website development

 

 

6,455

 

Office supplies

 

 

3,657

 

Marketing and advertising

 

 

2,700

 

Working capital

 

 

—

 

 

 

 

 

 

**Total**

 

$

23,714

 

 

The actual uses of proceeds described above were consistent with the anticipated uses of proceeds described in the Prospectus for the offering. 

 

 

17

 

 

 

**Exhibits and Reports on Form 10-QSB**

 

 

**Exhibit Number**

**Name and/or Identification of Exhibit**

 

 

3

Articles of Incorporation & By-Laws

 

 

 

(a) Articles of Incorporation *

 

 

 

(b) By-Laws adopted *

 

 

31

Rule 13a-14(a)/15d-14(a) Certification

 

 

32

Certification under Section 906 of the Sarbanes-Oxley Act (18 U.S.C. Section 1350)

 

 

*  Incorporated by reference herein filed as exhibits to the Company’s Registration Statement on Form SB-2 previously filed with the SEC on July 21, 2005, and subsequent amendments made thereto.

 

 

 

 

 

 

 

 

 

 

 

 

 

18

 

 

 

**SIGNATURES**

 

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

 

 

**EXPERT SYSTEMS, INC.**

(Registrant)

 

Signature

Title

Date

 

 

 

/s/ Shaun M. Jones

President and 

August 3, 2006

Shaun M. Jones

Chief Executive Officer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

19

 

 

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