U.S.
SECURITIES AND EXCHANGE COMMISSION


Washington,
D.C. 20549





FORM
10-K





(Mark
One)





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




For the
fiscal year ended December 31, 2009





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





For the
transition period from ___________ to ___________





Commission
file number: 000-29087





Datascension,
Inc.


(Exact
name of registrant as specified in its charter)





Nevada
            
            87-0374623(State
      or other jurisdiction of
            
            (IRS
      Employerincorporation
      or organization)
            
            Identification
      No.)





532
      Pima Canyon Court, Las Vegas, NV
            
            89144(Address
      of principal executive offices)
            
            (Zip
      Code)





702-233-6785


(Issuer’s
telephone number)


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





Securities
registered under Section 12(g) of the Exchange Act:





Common Stock, par value
$.001


(Title of
class)




Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act.


Yes oNo x




Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act.


Yes oNo x





Check
whether the issuer (1) filed all reports to be filed by Section 13 or 15(d) of
the Exchange Act during the past twelve 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 xNo o





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




Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer,” “accelerated filer,” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act.




Large
      accelerated filer o
            Accelerated
      filer oNon-accelerated
      filer   o
            Smaller
      Reporting Company x




Indicate
by check mark whether the registrant is a shel1 company (as defined in Rule
12b-2 of the Exchange Act).


Yes oNo x





State
registrant’s revenues for its most recent fiscal year. $14,814,100





State the
aggregate market value of the voting and non-voting common equity held by
non-affiliates computed by reference to the price at which the common equity was
sold, or the average bid and asked price of such common equity, as of a
specified date within the past 60 days. (See definition of affiliate in Rule
12b-2 of the Exchange Act.)





The
aggregate market value of voting common equity held by non-affiliates as of
April 14, 2010 was approximately $984,739.  The number of shares
outstanding of the registrant’s Common Stock, as of April 14, 2010, was
21,407,361 shares.




Documents
Incorporated by Reference




None.










TABLE OF
CONTENTS





Page
      No.PART
      IItem
      1. Description of Business
            
            1Item
      1A.  Risk Factors
            
            4Item
      2. Description of Properties
            
            13Item
      3. Legal Proceedings
            
            13PART
      IIItem
      4. Market for Registrant’s Common Equity, Related Stockholder
      Matters
            
            14Item
      5. Management’s Discussion and Analysis of Financial Condition and Results
      of Operations
            
            15Item
      6. Financial Statements and Supplementary Data
            
            20Item
      7. Changes in and Disagreements with Accountants on Accounting and
      Financial Disclosure
            
            21Item
      7A (T). Controls and Procedures
            
            21Item
      7B. Other Information
            
            22PART
      IIIItem
      8. Directors, Executive Officers and Corporate Governance
            
            22Item
      9. Executive Compensation
            
            25Item
      10. Security Ownership of Certain Beneficial Owners and Management and
      Related Stockholder Matters
            
            27Item
      11. Certain Relationships and Related Transactions, and Director
      Independence
            
            28Item
      12. Principal Accounting Fees and Services
            
            30PART
      IVItem
      13. Exhibits, Financial Statement Schedules
            
            31Signatures
            
            36










PART I





Forward-Looking
Statements





This
annual report contains forward-looking statements. The forward-looking
statements include all statements that are not statements of historical fact.
The forward-looking statements are often identifiable by their use of words such
as “may,” “expect,” “believe,” “anticipate,” “intend,” “could,” “estimate,” or
“continue,” “Plans” or the negative or other variations of those or comparable
terms. Our actual results could differ materially from the anticipated results
described in the forward-looking statements. Factors that could affect our
results include, but are not limited to, those discussed in Item 1A “Risk Factor
and item 5, “Management’s Discussion and Analysis of Financial Condition and
Results of Operation” and included elsewhere in this report.





ITEM 1. DESCRIPTION OF BUSINESS.





(a)
Entity History





Datascension,
Inc., (“DSEN” “datascension” or the  “Company” (formerly known as
Nutek)  was incorporated under the laws of the State of Nevada, on
August 23, 1991, under the name Swiss Technique, Inc. The original Articles of
DSEN authorized the issuance of fifty million (50,000,000) shares of common
stock with a par value of $0.001. On August 23, 1991, pursuant to Section
78.486, Nevada Revised Statutes as amended, DSEN filed with the Nevada Secretary
of State Articles of Merger, whereby DSEN merged with Sun Investments, Inc., a
Utah corporation. On or about April 10, 1992, the Issuer, with majority
shareholder vote filed Articles of Amendment to the Articles of Incorporation
with the Secretary of State of Nevada, authorizing five million (5,000,000)
shares of Preferred Stock each have a par value of $0.001, with such rights,
preferences and designations and to be issued in such series as determined by
the Board of Directors of the Corporation. DSEN in accordance with Section
78.250 of the Nevada Revised Statues and as a result of the majority consent of
shareholders executed on or about March 3, 1995 changed the name from Swiss
Technique, Inc., to Nutek, Inc. DSEN filed a Certificate of Amendment of
Articles of Incorporation with the Secretary of State of Nevada to change its
name.





On
December 24, 2003, 63.34% of the votes entitled to be cast at a meeting of
DSEN’s shareholders consented in writing to change the name of the corporation
from Nutek Inc. to Datascension Inc. (“DSEN”.) The Board of Directors of Nutek,
Inc. at a meeting duly convened, held on the 5th day of January, 2004, adopted a
resolution to amend the original articles of incorporation for the name
change.





The
Company currently has no operational subsidiary as Datascension International,
Inc. was merged into the Company during 2008. DSEN had four subsidiaries which
were disposed of as follows:, the non operating entities, Kristi & Co, Inc
and SRC International, Inc have been discontinued and written down as of
December 31, 2004. Century Innovations, Inc and Nutek Oil, Inc have been spun
off as separate operating entities which are managed and operated by independent
management.





Nutek Oil
was disposed of by issuing a dividend of the shares held by the parent company
to the shareholders of the parent company. The stock dividend was distributed to
owners of the Company’s common stock as of the record date in a ratio of one
share of dividend stock in the subsidiary for every 500 shares of common stock
owned in Datascension, Inc.




Century
Innovations was disposed of by issuing a dividend of the shares held by the
parent company to the shareholders of the parent company. The stock dividend was
distributed to owners of the Company’s common stock as of the record date in a
ratio of one share of dividend stock in the subsidiary for every 300 shares of
common stock owned in Datascension, Inc.




1





DSEN
previously distributed a portion of its ownership to Datascension shareholders.
The Company has additionally distributed all but 10% of its ownership in Century
to Century as Treasury Stock on the books of Century. It will remain as Treasury
Stock on the books of Century until the effectiveness of a Form 10 registration
to be filed by Century for the shares. Within sixty (60) days of the Form 10’s
effectiveness, Century will work with the Company to distribute the shares to
the then current Datascension shareholders.





DSEN’s
mailing address is: 532 Pima Canyon Court, Las Vegas, Nevada 89144,
702-233-6785. The Company website can be found at
www.datascension.com.





(b)
Business of Issuer





On July
2, 2001, the DSEN acquired 100% of the issued and outstanding stock of
Datascension International. Datascension International is a data gathering and
research company. Its expertise is in the collection, storage, processing and
interpretation of data. Datascension International’s management team has over 30
years of experience in working with clients to gather the information they need
to make changes or advancements to their operations. Datascension International
services a variety of industries and customers (including the hospitality,
entertainment, and automotive sectors) with emphasis and commitment to customer
service, quality assurance and on-time project management.





1)
Principal Products, Services and Principal Markets.





Services





Telephone
Interviewing (CATI or Paper). Currently, Datascension’s CATI telephone facility
employs approximately 1,200 part- and full-time telephone interviewers, many of
whom are bilingual in Spanish and English. Datascension and other leading
research agencies have found that streamlining their systems with integrated
CATI and automatic dialing capabilities have resulted in quicker turnaround,
lower costs and increased field capacity for phone research
projects.





Internet
Data Collection





Datascension
has a full-time programming staff experienced in designing all types of web
surveys, web panels, and data collection sites.




Database
Engineering





Datascension
has the expertise to create databases from very small to the most complex fully
relational database. Its database software allows the end-user to connect to
Datascension’s system via the Internet and run reports and pull data with
relatively no training.





Data
Storage





Datascension
employs large disk storage hardware for short and long-term document and file
archive and retrieval.





Document
Processing





Datascension
has developed an expertise in data value ensuring the greatest care in document
processing services including clerical handling of documents, coding, data
entry, scanning and storage.




2





Data
Reporting & Mining





Datascension
staff can program banners using the latest version of Quantum (SPSS) tabulation
software. They have extensive experience of handling most types of data
including ASCII, flat file, CSV, XML and many other formats.





In-bound
Customer Service





Datascension’s
expertise in handling customer service calls covers a wide spectrum of
industries from hardware order taking to infomercial support. Activities include
on-line order booking to technical support for client products and
services.





Bilingual
Interviewing





People of
Hispanic or Latino descent comprise 12.5% of the US population, according to
2000 US Census figures. Datascension has recognized the importance of surveying
this population. Datascension has begun a more concerted effort to target the
Hispanic community and garner their input as a separate and unique segment of
our society.   To that end, we contract a number of bilingual
interviewers who are skilled in conducting research in both Spanish and
English.





Major
Clients





During
the year ended December 31, 2009, the Company had five major clients, Synovate
(12.22%), Admax Media, Inc.  (10.91%), Sandelman & Associates
(8.6%), Nielsen (7.64%), and Market Cast (7.56%). Management believes the loss
of one of these key clients would materially affect the operations of the
company in the short term.





All of
the revenue generated is from Datascension, Inc., with about 98% of the revenue
from the telephone interviewing and customer service with approximately 2%
coming from the data services and programming division. Customers are located
through referrals from existing customers and from leads generated by our sales
staff.




Our
business does not involve “telemarketing”. Telemarketing, in the call center
industry, refers to the marketing of goods and services by telephone. We do not
market goods or services for clients, but instead conduct interviews and gather
information from interviewees. As a result the government regulation of the “do
not call list” that has been implemented to stop unsolicited telemarketing does
not affect our industry and we are not bound to comply by the Amended
Telemarketing Sale Rule (TSR).





Who Must
Comply with the Amended Telemarketing Sale Rule (TSR)?





The
amended TSR regulates “telemarketing”- defined in the Rule as “a plan, program,
or campaign to induce the purchase of goods or services or a charitable
contribution” involving more than one interstate telephone call.” (The FCC
regulates both intrastate and interstate calling. More information is available
from www.fcc.gov.). With some important exceptions, any businesses or
individuals that take part in “telemarketing” must comply with the Rule. This is
true whether, as “telemarketers,” they initiate or receive telephone calls to or
from consumers, or as “sellers,” they provide, offer to provide, or arrange to
provide goods or services to consumers in exchange for payment. It makes no
difference whether a company makes or receives calls using low-tech equipment or
the newest technology-such as voice response units (VRUs) and other automated
systems. Similarly, it makes no difference whether the calls are made from
outside the United States; so long as they are made to consumers in the United
States, those making the calls, unless otherwise exempt, must comply with the
TSR’s provisions. If the calls are made to induce the purchase of goods,
services, or a charitable contribution, the company is engaging in
“telemarketing.”





Certain
sections of the Rule apply to individuals or companies other than “sellers” or
“telemarketers” if these individuals or companies provide substantial assistance
or support to sellers or telemarketers. The Rule also applies to individuals or
companies that provide telemarketers with unauthorized access to the credit card
system.




3





2)
Employees/Contract workers





DSEN
currently has both employees and contracted help. The employees have residence
in the US but spend most of their time in Costa Rica managing the
Company.  In addition to the three Company employees, of which (2) are
Officers of DSEN, the Company employs approximately 1000 contracted individuals
working for DSEN of which 120 are full-time.





3)
Competition





We
currently face significant competition for outsourced market research services
and expect that competition will increase. We believe that, in addition to
prices, the principal competitive factors in our markets are service quality and
interviewing skills, the ability to develop customized designs and technological
and industry expertise. While numerous companies provide market research
services, we believe our principal competitors include our clients’ own in-house
market research groups, including, in some cases, in- house groups operating
offshore, offshore outsourcing companies and U.S.-based outsourcing companies.
The trend toward offshore outsourcing, international expansion by foreign and
domestic competitors and continuing technological changes will result in new and
different competitors entering our markets. These competitors may include
entrants from the communications industries or entrants in geographic locations
with lower costs than those in which we operate.





ITEM
1A.  RISK FACTORS





Risks
Relating to our Business:





1.
Efforts to expand operations through developing new services, features and
functions may drain capital resources if not successful.





There can
be no assurance that DSEN will be able to expand its operations in a
cost-effective or timely manner or that any such efforts would maintain or
increase overall market value and acceptance. Furthermore, any new business
launched by DSEN that is not favorably received by consumers could drain DSEN of
needed capital, damage DSEN’s reputation and diminish the value of its brand
name.




Expansion of DSEN’s operations would require significant
expenditure for development, operation setup, and training of DSEN’s management,
financial and operational resources. Any lack of market acceptance of DSEN’s
products or services would result in the inability to generate satisfactory
revenues and to offset its costs of the expansion, which could have a material
adverse effect on DSEN’s results of operations and financial condition.





2.
Efforts to establish brand identity is costly and failure to succeed could
adversely affect DSEN’s ability to grow.





DSEN
believes that establishing and maintaining brand identity is a critical aspect
of its efforts to attract new customers. In order to attract new customers,
advertisers and commerce vendors, and in response to competitive pressures, DSEN
intends to make a commitment to the creation and maintenance of brand loyalty
among these groups. DSEN plans to accomplish this, although not exclusively,
through advertising its products and services through its Web site, through the
various search engines, through other Web sites and marketing its site to
businesses and customers through e-mail, online media, trade publications, trade
shows and other marketing and promotional efforts.




4





There can
be no assurance that brand promotion activities will yield increased revenues or
that any such revenues would offset the expenses incurred by DSEN in building
its brands. If DSEN fails to promote and maintain its brand or incurs
substantial expenses in an attempt to promote and maintain its brand or DSEN’s
existing or future strategic relationships fail to promote DSEN’s brand or
increase brand awareness, DSEN’s business, results of operations and financial
condition would be materially adversely affected.





3. Our
clients may adopt technologies that decrease the demand for our services, which
could reduce our revenues and seriously harm our business.





We target
clients with a high need for our market research services, and we depend on
their continued need of our services, especially our major clients who generate
the substantial majority of our revenues. However, over time, our clients may
adopt new technologies that decrease the need for live customer interaction,
such as interactive voice response, web-based research and other technologies
used to automate interactions with interviewers. The adoption of such
technologies could reduce the demand for our services, pressure our pricing,
cause a reduction in our revenues and harm our business.




4. We
serve markets that are highly competitive, and we may be unable to compete with
businesses that have greater resources than we do.





We
currently face significant competition for outsourced market research services
and expect that competition will increase. We believe that, in addition to
prices, the principal competitive factors in our markets are service quality and
interviewing skills, the ability to develop customized designs and technological
and industry expertise. While numerous companies provide market research
services, we believe our principal competitors include our clients’ own in-house
market research groups, including, in some cases, in- house groups operating
offshore, offshore outsourcing companies and U.S.-based outsourcing companies.
The trend toward offshore outsourcing, international expansion by foreign and
domestic competitors and continuing technological changes will result in new and
different competitors entering our markets. These competitors may include
entrants from the communications industries or entrants in geographic locations
with lower costs than those in which we operate.





Additionally,
the market for customer contact services and market research is highly
fragmented and very competitive. In certain segments of the industry, however,
the customer contact services and market research industries have begun to
experience a degree of consolidation, and the development of major customer
contact center companies has resulted in an additional level of competition from
service providers that have greater name recognition, larger installed customer
bases, and significantly greater financial, technical, and marketing resources
than we have. Large established enterprise software companies may leverage their
existing relationships and capabilities to offer customer service applications.
In other instances, many large companies provide their own in-house customer
care support and customer training. Also, a number of existing companies have
experienced rapid internal growth, and several of these companies have been
active in acquiring smaller regional customer contact services and call center
companies and are becoming major competitors with a measurable share of this
rapidly expanding market. If our competitors provide more efficient or less
expensive services, we may lose market share and revenues.





Lastly,
many of our existing competitors and possibly potential new competitors, have or
may have greater financial, personnel and other resources, longer operating
histories, more technological expertise, more recognizable brand names and more
established relationships in industries that we currently serve or may serve in
the future. Increased competition, our inability to compete successfully against
current or future competitors, pricing pressures or loss of market share could
result in increased costs and reduced operating margins, which could harm our
business, operating results, financial condition and future
prospects.





5. Many
of our contracts can be terminated by our clients on short notice and in many
cases without penalty. We also generally do not have exclusive arrangements with
our clients or a minimum revenue commitment from our clients, which creates
uncertainty about the volume of services we will provide and the amount of
revenues we will generate from any of our clients.




5




We may
enter into written agreements with one or more clients for our services. We seek
to sign multi-year contracts with our clients, but many of our contracts permit
our clients to terminate the contracts upon short notice. The volume and type of
services we perform for specific clients may vary from year to year,
particularly since in many cases we are not the exclusive provider of
outsourcing services to our clients. A client in one year may not provide the
same level of revenues in a subsequent year. Many of our clients may terminate
their contracts with us before their expiration with no penalties or limited
penalties.





Many of
our clients could terminate their relationship with us or reduce their demand
for our services due to a variety of factors, including factors that are
unpredictable and outside of our control. The services we provide to a client
could be reduced if the client were to change its outsourcing strategy. Clients
may move more market research functions in-house, to an affiliated outsourcing
provider or to one of our competitors. Clients may reduce spending on
outsourcing services due to changing economic conditions or financial challenges
or political or public relations pressures to reduce or eliminate offshore
outsourcing of business processes. If our clients are not successful or if they
experience any significant decrease in their businesses, the amount of business
they outsource and the prices that they are willing to pay for such services may
be diminished and likely would result in reduced revenues for us.  Any
reduction in revenues would harm our business, negatively affect operating
results and may lead to a decline in the price of our common stock.





6. We
have a limited operating history and our business and future prospects are
difficult to evaluate.





Due to
our limited operating history, especially in Costa Rica, where we consolidated
much of our market research operations in 2002, our business and future
prospects are difficult to evaluate. You should consider the challenges, risks
and uncertainties frequently encountered by early-stage companies using new and
unproven business models in rapidly evolving markets. These challenges include
our ability to:




·
            attract
      and retain clients;




·
            attract
      and retain key personnel and customer management
      professionals;





·
            generate
      sufficient revenues and manage costs to maintain
      profitability;





·
            manage
      growth in our operations; and





·
            maintain
      access additional capital when required and on reasonable
      terms.





7. Our
operating results may fluctuate significantly and could cause the market price
of our common stock to fall rapidly and without notice.




Our
revenues and operating results are difficult to predict and may fluctuate
significantly from quarter to quarter due to a number of factors,
including:





·the addition or loss of a major client and the volume of services
provided to our major clients;





·the extent to which our services achieve or maintain market acceptance,
which may be affected by political and public relations reactions to offshore
outsourcing;





·our ability to introduce new or enhanced services to our existing and
prospective clients and to attract and retain new clients;





·long sales cycles and fluctuations in sales cycles;




6





· the extent to which we incur expenses in a given period in
anticipation of increased demand in future periods, and the extent to which that
demands materializes;





·changes in our pricing policies or those of our competitors, as well as
increased price competition in general;





·variation in demand for our services and the services or products of our
major clients, particularly clients in the travel and hospitality industry;
and





·the introduction of new or enhanced services by other outsourced service
providers.





Results
of operations in any quarterly period should not be considered indicative of the
results to be expected for any future period. In addition, our future quarterly
operating results may fluctuate and may not meet the expectations of securities
analysts or investors. If this occurs, the trading price of our common stock
could fall substantially, either suddenly or over time.





8. If we
fail to manage our growth effectively, our business may not
succeed.





We have
expanded significantly since our formation and intend to maintain our growth
focus. However, our growth will place demands on our resources and we cannot be
sure that we will be able to manage our growth effectively. In order to manage
our growth successfully, we must:





·maintain the hiring, training and management necessary to ensure the
quality and responsiveness of our services;





·expand and enhance our administrative and technical infrastructure,
facilities and capacities to accommodate increased call volume and other
customer management demands; and





·continue to improve our management, financial and information systems and
controls.




Continued
growth could place a strain on our management, operations and financial
resources. Our infrastructure, facilities and personnel may not be adequate to
support our future operations or to adapt effectively to future growth. As a
result, we may be unable to manage our growth effectively, in which case our
operating costs may increase at a faster rate than the growth in our revenues,
our margins may decline and we may incur losses.





9. We may
experience significant employee turnover rates in the future and we may be
unable to hire and retain enough sufficiently trained employees to support our
operations, which could harm our business.





The
market research outsourcing industry is very labor intensive and our success
depends on our ability to attract, hire and retain qualified employees. We
compete for qualified personnel with companies in our industry and in other
industries and this competition are increasing in Costa Rica as the outsourcing
industry expands. Our growth requires that we continually hire and train new
personnel. The outsourcing industry, including the customer management services
industry, has traditionally experienced high employee turnover. A significant
increase in the turnover rate among our employees would increase our recruiting
and training costs and decrease operating efficiency and productivity, and could
lead to a decline in demand for our services. If this were to occur, we would be
unable to service our clients effectively and this would reduce our ability to
continue our growth and operate profitably. We may be unable to continue to
recruit, hire, train and retain a sufficient labor force of qualified employees
to execute our growth strategy or meet the needs of our business.





10. Our
senior management team is important to our continued success and the loss of
members of senior management could negatively affect our
operations.





The loss
of the services of Lou Persico, our Chief Executive Officer, David Lieberman,
and our Chief Financial Officer could seriously impair our ability to continue
to manage and expand our business. Our success depends on the continued service
and performance of our executive officers, and we cannot guarantee that we will
be able to retain these individuals.




7





11. Our
facilities are at risk of damage by earthquakes and other natural
disasters.





We
currently rely on the availability and condition of our Costa Rican facilities
to provide service and support to our clients. These facilities are located in a
region that is susceptible to earthquakes and other natural disasters, which may
increase the risk of disruption of information systems and telephone service for
sustained periods. Damage or destruction that interrupts our provision of
outsourcing services could damage our relationship with our clients and may
cause us to incur substantial additional expense to repair or replace damaged
equipment or facilities. While we currently have commercial liability insurance,
our insurance coverage may not be sufficient. Furthermore, we may be unable to
secure such insurance coverage or to secure such insurance coverage at premiums
acceptable to us in the future. Prolonged disruption of our services as a result
of natural disasters may entitle our clients to terminate their contracts with
us.




12. Our
operations could suffer from telecommunications or technology downtime,
disruptions or increased costs.





We are
highly dependent on our computer and telecommunications equipment and software
systems. In the normal course of our business, we must record and process
significant amounts of data quickly and accurately to access, maintain and
expand the databases we use for our services. We are also dependent on
continuous availability of voice and electronic communication with
customers.





If we
experience interruptions of our telecommunications network with our clients, we
may experience data loss or a reduction in revenues. These disruptions could be
the result of errors by our vendors, clients or third parties, electronic or
physical attacks by persons seeking to disrupt our operations, or the operations
of our vendors, clients or others. A significant interruption of service could
have a negative impact on our reputation and could lead our present and
potential clients not to use our services. The temporary or permanent loss of
equipment or systems through casualty or operating malfunction could reduce our
revenues and harm our business.





13. Our
customer base is concentrated and the loss of one or more of our key customers
would harm our business.





Historically,
a majority of our sales have been to relatively few customers. We expect that
sales to relatively few customers will continue to account for a significant
percentage of our net sales for the foreseeable future. The loss of, or any
reduction in interview hours from, a significant customer would harm our
business.





Our ten
largest clients accounted for $10,853,775 of revenues, or approximately 73.3% of
our total net revenues for the year ended December 31, 2009.  If we
lose business from any of our top ten clients, our net revenues may decline
substantially.





14. We
could cause disruptions to our clients’ business from inadequate service, and
our insurance coverage may be inadequate to cover this risk.





Most of
our contracts with our clients contain service level and performance
requirements, including requirements relating to the timing and quality of
responses to market research. The quality of services that we provide is
measured by quality assurance ratings, which are based in part on the results of
customer satisfaction and direct monitoring of interactions between our
professionals and customers. Failures to meet service requirements of a client
could disrupt the client’s business and result in a reduction in revenues or a
claim for damages against us. For example, some of our agreements have standards
for service that, if not met by us, result in lower payments to us. In addition,
because many of our projects are business-critical projects for our clients, a
failure or inability to meet a client’s expectations could seriously damage our
reputation and affect our ability to attract new business.




8




Under our
contracts with our major clients and many of our contracts with other clients,
our liability for breaching our obligations is generally limited to actual
damages up to a portion of the fees paid to us. To the extent that our contracts
contain limitations on liability, such contracts may be unenforceable or
otherwise may not protect us from liability for damages. While we maintain
general liability insurance coverage, this coverage may be inadequate to cover
one or more large claims, and our insurer may deny coverage.





15.
Unauthorized disclosure of sensitive or confidential client and customer data,
whether through breach of our computer systems or otherwise, could expose us to
protracted and costly litigation and cause us to lose clients.





We are
typically required to collect and store sensitive data in connection with our
services, including names, addresses and other personal information. If any
person, including any of our employees, penetrates our network security or
otherwise misappropriates sensitive data, we could be subject to liability for
breaching contractual confidentiality provisions or privacy laws. Penetration of
the network security of our data bases could have a negative impact on our
reputation and could lead our present and potential clients to choose other
service providers.





16. We
are subject to extensive laws and regulation that could limit or restrict our
activities and impose financial requirements or limitations on the conduct of
our business.





The
market research and call center industry has become subject to an increasing
amount of federal and state regulation in the past five years. Despite our focus
on outbound market research and a lesser extent inbound call handling, we are
subject to regulations governing communications with consumers due to the
activities we undertake on behalf of our clients to encourage customers to
provide sensitive personal information about themselves. For example, limits on
the transport of personal information across international borders such as those
now in place in the European Union (and proposed elsewhere) may limit our
ability to obtain customer data.





Additional
federal, state, local or international legislation, or changes in regulatory
implementation, could further limit our activities or those of our clients in
the future or significantly increase the cost of regulatory
compliance.





17. Our
ability to raise capital in the future, if and when needed, may be limited, and
could prevent us from executing our business strategy. The sale of additional
equity securities would result in further dilution to our
stockholders.





We
believe that our existing cash and cash equivalents will be sufficient to
support our anticipated cash needs through 2010. However, the timing and amount
of our working capital and capital expenditure requirements may vary
significantly depending on numerous factors, including:





·market acceptance of and demand for our offshore outsourced services
which may be affected by political and public relations reactions to offshore
outsourcing;




·access to and availability of sufficient management, technical, marketing
and financial personnel;





·the need to enhance our operating infrastructure;




9





·the continued development of new or enhanced services and hosted
designs;





·the need to adapt to changing technologies and technical
requirements;





·the existence of opportunities to acquire businesses or technologies, or
opportunities for expansion; and





·increased competition and competitive pressures.





If our
capital resources are insufficient to satisfy our liquidity requirements, we may
seek to sell additional equity or debt securities or obtain other debt
financing. The sale of additional equity securities or convertible debt
securities would result in additional dilution to our stockholders. Additional
debt would result in increased expenses and could result in covenants that
restrict our operations. We may be unable to secure financing in sufficient
amounts or on terms acceptable to us, if at all, in which case we may not have
the funds necessary to finance our ongoing capital requirements or execute our
business strategy.





Risks
Related to Doing Business Offshore





1. We may
face wage inflation and additional competition offshore for our professionals,
which could increase the cost of qualified workers and the amount of worker
turnover.





Fees for
our contract workers offshore could increase at a faster rate than for U.S.
employees, which could result in increased costs to employ our outsourcing
center professionals. We also are faced with competition in Costa Rica for
outsourcing center professionals, and we expect this competition to increase as
additional outsourcing companies enter the market and expand their operations.
In particular, there may be limited availability of qualified interviewers and
both middle and upper management candidates. We have benefited from an excess of
supply over demand for college graduates in Costa Rica. If this favorable
imbalance changes due to increased competition, it could affect the availability
or cost of qualified professionals, who are critical to our performance. This
could increase our costs and turnover rates.





Risks
Relating to our Industry





1. The
marketing research industry is vulnerable to general economic conditions, which
may affect our revenues.




Companies
served by our clients treat all or a portion of their marketing research
expenditures as discretionary.  As general economic conditions worsen
and these companies seek to control variable costs, research projects for which
we have been engaged to collect data may be delayed or cancelled, and new
project bookings may slow. As a result, our growth rate and revenues may
decline.





Risks
Relating to our Stock and Financing Arrangements:





1. The
overhang effect from the resale of the selling shareholders securities on the
market could result in lower stock prices when converted Overhang can translate
into a potential decrease in DSEN’s market price per share. If the share volume
cannot absorb the sale of these shares, DSEN’s market price per share will
likely decrease. As the market price decreases, each subsequent conversion will
require a larger quantity of shares.





2. Short
selling common stock by warrant and convertible note holders may drive down the
market price of DSEN’s stock.





The
warrant and convertible note holders may sell shares of DSEN’s common stock on
the market before exercising the warrant or converting the notes. The stock is
usually offered at or below market since the warrant and debenture holders may
receive stock at a discount to market (depending on the then prevailing market
price as conversion prices and warrant exercise prices are fixed). Once the sale
is completed the holders exercise or convert a like dollar amount of shares. If
the stock sale lowered the market price, upon exercise or conversion, the
holders would receive a greater number of shares than they would have absent the
short sale. This pattern may result in the spiraling down of DSEN’s stock’s
market price.




10





3. DSEN’s
common stock is subject to the “Penny Stock” rules of the SEC and the trading
market in DSEN’s securities is limited, which makes transactions in DSEN’s stock
cumbersome and may reduce the value of an investment in DSEN’s
stock.





DSEN’s
shares of Common Stock are “penny stocks” as defined in the Exchange Act, which
are quoted in the over the counter market on the OTC Bulletin Board. As a
result, an investor may find it more difficult to dispose of or obtain accurate
quotations as to the price of the shares of the Common Stock being registered
hereby. In addition, the “penny stock” rules adopted by the Commission under the
Exchange Act subject the sale of the shares of the Common Stock to certain
regulations which impose sales practice requirements on broker dealers. For
example, broker dealers selling such securities must, prior to effecting the
transaction, provide their customers with a document that discloses the risks of
investing in such securities. Included in this document are the
following:





·The bid and offer price quotes for the penny stock, and the number of
shares to which the quoted prices apply.





·The brokerage companies compensation for the trade.




·The compensation received by the brokerages firm’s salesperson for the
trade.





In
addition, the brokerage firm must send the investor:





·Monthly account statement that gives an estimate of the value of each
penny stock in your account.





·A written statement of your financial situation and investment
goals.





Legal
remedies, which may be available to you, are as follows:





·If penny stocks are sold to you in violation of your rights listed above,
or other federal or state securities laws, you may be able to cancel your
purchase and get your money back.





·If the stocks are sold in a fraudulent manner, you may be able to sue the
persons and firms that caused the fraud for damages.





·If you have signed an arbitration agreement, however, you may have to
pursue your claim through arbitration.





If the
person purchasing the securities is someone other than an accredited investor or
an established customer of the broker dealer, the broker dealer must also
approve the potential customer’s account by obtaining information concerning the
customer’s financial situation, investment experience and investment objectives.
The broker dealer must also make a determination whether the transaction is
suitable for the customer and whether the customer has sufficient knowledge and
experience in financial matters to be reasonably expected to be capable of
evaluating the risk of transactions in such securities. Accordingly, the
Commission’s rules may limit the number of potential purchasers of the shares of
the Common Stock.




11





4. Resale
restrictions on transferring “penny stocks” are sometimes imposed by some
states, which may make transactions in our stock cumbersome and may reduce the
value of an investment in DSEN’s stock.





Various
state securities laws impose restrictions on transferring “penny stocks” and as
a result, investors in the Common Stock may have their ability to sell their
shares of the Common Stock impaired. For example, the Utah Securities Commission
prohibits brokers from soliciting buyers for “penny stocks”, which makes selling
them more difficult.





5. DSEN’s
absence of dividends or the ability to pay them places a limitation on any
investor’s return.





DSEN
anticipates that for the foreseeable future, earnings will be retained for the
development of its business. Accordingly, DSEN does not anticipate paying
dividends on the common stock in the foreseeable future. The payment of future
dividends will be at the sole discretion of DSEN’s Board of Directors and will
depend on DSEN’s general business condition.




6. The
market price for our common stock may be volatile, making an investment in DSEN
risky.





The
market price for our common stock has been and is likely to continue to be
highly volatile and subject to wide fluctuations in response to factors
including the following:





·actual or anticipated fluctuations in our quarterly operating
results,





·announcements of new services by us or our competitors,





·changes in the economic performance or market valuations of other
companies involved in call center services or market research
services,




·announcements by our competitors of significant acquisitions, new
strategic alliances, joint ventures or capital commitments,





·additions or departures of key personnel,





·potential litigation, or





·economic conditions in the outsourced call center market.





7. We
have entered into a senior secured credit arrangement which, if in default,
could cause the lender to foreclose on our assets.





On
November 7, 2008, the Company entered into an Account Purchase Agreement
(“Agreement”) with Wells Fargo Bank, National Association (“Wells Fargo”)
pursuant to which Wells Fargo has agreed to purchase certain accounts receivable
from the Company from time to time, up to $4.5 million, at a price equal to the
face value of each such receivable less a discount equal to .5% plus the then
existing prime rate, plus three percent plus other fees and charges. Any
accounts sold to Wells Fargo for which payment is not received within the
proscribed time periods in the Agreement shall be subject to repurchase by the
Company. To secure this repurchase and other obligations of the Company there
under, the Company granted a first lien on all of its assets to Wells Fargo. In
connection therewith, the Longview Fund and Alpha Capital Anstalt agreed to
subordinate their security interests in the Company’s collateral to the security
interests of Wells Fargo.





Accordingly,
if we were to default under this arrangement, Wells Fargo would be able to
foreclose on all of our assets, possibly leaving us with no operating business
or assets.




12





ITEM 2. DESCRIPTION OF PROPERTY.





The
principal office of 5,102 square feet of office space at 145 State College
Blvd., Ste. 350,   Brea California 92821 was sub-leased in July, 2007. Net
rent expense recorded during 2009 and 2008 was $4,633 and $7,502,
respectively.





The
address of the Costa Rica facility is: Datascension Mall San Pedro, Quatro
Piso, antiguo Planet Mall, San Pedro, San Jose, Costa Rica, where the Company
leases approximately 42,831 square feet. The Company also leases approximately
22,368 square feet in Limon, Costa Rica which is cancellable on 30 days’ prior
notice.  The details on the leases, which are all cancellable on 90
days’ prior notice, comprising the new Costa Rica facility (described
below) are as follows:




Floor
            
            Under Name
            
            Monthly
      Amount
            
            Startingdate
            
            EndingDateRent
      3rd Floor
            
            Arrendamientos
      Capitulo Zeta
            
            $
            2,766
            
            March
      15, 2008
            
            March
      15,2011Rent
      Ciber City
            
            Arrendadora
      Coturno S.A
            
            $
            8,575
            
            May
      15, 2006
            
            May
      15, 2013Rent
      Planet Mall
            
            Incredible
      Universo M.O.S.A
            
            $
            22,050
            
            May
      01, 2006
            
            May
      01, 2013Call
      Center Limon
            
            Limon
      Club de Campo S.A.
            
            
            2,625
            
            January
      15, 2008
            
            June
      30, 2011$
            36.016




DSEN is
of the opinion that the current locations it uses are suitable, adequate, and in
good condition for current as well as for future operations and
business.





ITEM 3. LEGAL PROCEEDINGS.





DSEN is
from time to time involved in litigation incident to the conduct of its
business. Certain litigation with third parties and present and former employees
of DSEN is routine and incidental, such litigation can result in large monetary
awards for compensatory or punitive damages.





DSEN is
not currently a party to any pending material legal proceeding. To the knowledge
of management, no federal, state or local governmental agency is presently
contemplating any proceeding against the Company. To the knowledge of
management, no director, executive officer or affiliate of the Company, any
owner of record or beneficially of more than 5% of the Company’s common stock is
a party adverse to the Company or has a material interest adverse to the Company
in any proceeding.




13





PART II





ITEM 4. MARKET FOR COMMON EQUITY  RELATED STOCKHOLDER
MATTERS.





Market Information





Datascension,
Inc., Common Stock is traded on the OTC Bulletin Board (OTCBB) under the symbol
“DSEN”. The following table sets forth the high and low bid quotations for the
Common Stock for the periods indicated. These quotations reflect prices between
dealers do not include retail mark-ups, markdowns, and commissions and may not
necessarily represent actual transactions. These bid quotations have not been
adjusted retroactively by any stock split. As of December 31, 2009, DSEN had
approximately 1,155 shareholders of record.





Period
            
            High
            
            LowCalendar
      Year 2008March
      31, 2008
            
            
            0.63
            
            
            0.30June
      30, 2008
            
            
            0.30
            
            
            0.09September
      30, 2008
            
            
            0.09
            
            
            0.06December
      31, 2008
            
            
            0.11
            
            
            0.01Calendar
      Year 2009March
      31, 2009
            
            
            0.15
            
            
            0.02June
      30, 2009
            
            
            0.15
            
            
            0.03September
      30, 2009
            
            
            0.10
            
            
            0.02December
      31, 2009
            
            
            0.15
            
            
            0.04





These
quotations do not necessarily reflect actual transactions, retail mark-ups,
mark-downs or commissions. The transactions include inter-dealer
transactions.





These
quotations reflect inter dealer prices, without retail mark-up, markdown or
commission, and may not necessarily represent actual transactions. These bid
quotations have not been adjusted retroactively by any stock split.





Shareholders
of Record and Outstanding Shares





The
authorized capital stock of DSEN consists of 200,000,000 shares of common stock
with a par value of $.001 per share and 20,000,000 shares of preferred stock at
a par value of $.001 per share.





As of
December 31, 2009, DSEN had 21,407,361 shares of its $.001 par value common
voting stock issued and outstanding which are held by 1,155 shareholders of
record. As of December 31, 2009, there were no shares of Series B Preferred
Stock outstanding.   DSEN has not paid any dividends to date. In
addition, it does not anticipate paying dividends in the immediate foreseeable
future. The Board of Directors of the Company will review its dividend policy
from time to time to determine the desirability and feasibility of paying
dividends after giving consideration to the Company’s earnings, financial
condition, capital requirements and such other factors as the board may deem
relevant.





Reverse
Split





On
November 4, 2004, Datascension Inc., announced its board of directors has
authorized a reverse split of the company’s common stock at a ratio of
one-for-ten.





The
reverse split, which was approved by the Company’s stockholders at the last
shareholder meeting, took effect on November 5, 2004. Each ten shares of the
Company’s issued and outstanding common stock were automatically converted into
one share of common stock. No fractional shares were issued. Holders of
fractional shares received shares rounded to the nearest whole
share.





The
reverse split affected all of stockholders uniformly and did not affect any
stockholder’s percentage ownership interests in the Company or proportionate
voting power.




14




Preferred
Shares





The
Series B preferred shares pursuant to the certificate of designation were to be
converted two years after issuance.  The company reached agreement
with holders of Series B preferred shares that it was able to contact and
received these shares back.  The company has no record and was unable
to locate the remaining holders of the Series B preferred shares and therefore
the board has taken the position that the value of the remaining shares and
paid-in capital be adjusted to zero.





Securities
Authorized for Issuance under Equity Compensation Plans





No
securities were issued under an equity compensation plan in 2009.





Recent
Sales of Unregistered Securities





During
the fiscal year ended December 31, 2009, the Company issued securities using the
exemptions available under the Securities Act of 1933 including unregistered
sales made pursuant to Section 4(2) of the Securities Act of 1933 as
follow:





100,000
shares of common stock were issued to settle an agreement for services valued at
$3,000




There
were no other issuances of stock or options other than those mentioned
above.





All of
these transactions were exempt from the registration requirements of the
Securities Act of 1933, as amended, by virtue of the exemptions provided under
section 4(2) was available because:





·The
transfer or issuance did not involve underwriters, underwriting discounts or
commissions;





·A
restriction on transfer legend was placed on all certificates
issued;




·The
distributions did not involve general solicitation or advertising;
and,





·The
distributions were made only to insiders, accredited investors or investors who
were sophisticated enough to evaluate the risks of the investment. Each
shareholder was given access to all information about our business and the
opportunity to ask questions and receive answers about our business from our
management prior to making any investment decision.





ITEM 5. MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS.





Introduction





The
following discussion and analysis should be read in conjunction with our
accompanying financial statements and the notes to those financial statements
included elsewhere in this Annual Report. The following discussion includes
forward-looking statements that reflect our plans, estimates and beliefs. Our
actual results could differ materially from those discussed in these forward-
looking statements. Factors that could cause or contribute to such differences
include, but are not limited to, those discussed below and elsewhere in this
Annual Report.





Overview





Revenue
Recognition.





We
recognize revenues when survey data is delivered to the client in accordance
with the terms of our agreements. Research products are delivered within a short
period, generally ranging from a few days to approximately eight weeks. An
appropriate deferral is made for direct costs related to contracts in process,
and no revenue is recognized until delivery of the data has taken place.
Billings rendered in advance of services being performed, as well as customer
deposits received in advance, are recorded as a current liability included in
deferred revenue. We are required to estimate contract losses, if any, and
provide for such losses in the period they are determined and estimable. We do
not believe that there are realistic alternatives to our revenue recognition
policy given the short period of service delivery and the requirement to deliver
completed surveys to our customers. We do not believe there is significant risk
of recognizing revenue prematurely since our contracts are standardized, the
earnings process is short, and no single project accounts for a significant
portion of our revenue.




15





Convertible
Debt Financing and Derivative Liabilities





In accordance withASC 815,
Disclosures about Derivative
Instruments and Hedging Activities”,, the holder’s conversion right
provision, interest rate adjustment provision, liquidated damages clause, cash
premium option, and the redemption option (collectively, the debt features)
contained in the terms governing the Notes are not clearly and closely related
to the characteristics of the Notes. Accordingly, the features qualified as
embedded derivative instruments at issuance and, because they do not qualify for
any scope exception within ASC 815, they were required by ASC 815 to be
accounted for separately from the debt instrument and recorded as derivative
financial instruments.




Since
November 2004, the Company had entered into multiple financing arrangements. In
past funding arrangements, the specific terms of the funding arrangements
contained certain covenants and liquidated damages which were deemed to make the
notes be debt be considered non-conventional. Such treatment required a
valuation of all derivative items of the notes, which created a liability on the
balance sheets, coupled with a liability for the value of any warrants that were
outstanding at the balance sheet date. The December 2006 note settled all prior
interest, liquidated damages and other perceived “negative” items that were
tainting the debt. The latter note also served to amend and limit the
liabilities, so as to satisfy the EITF 00-27 requirements and end the
requirement of the Company to have the derivative accounting treatment. Below is
a summary of the major terms of the notes outstanding as of December 31, 2009
(See “Accounts Payable and Accrued Liabilities” under the heading “Liquidity and
Capital Resources”).





Upon the
entering into of the December 2006 transaction, the Company removed all of the
prior derivative liability portions of the convertible debt, as all clauses had
been removed from the debts and agreements. This resulted in an expense to
remove the debt discounts that were previously being accreted, as well as the
financing costs being accreted over the remaining term. Concurrently, there was
an income item reported with a corresponding write off of the liabilities
associated with derivatives and the warrant liabilities on the
books.





Plan of
Operation





(a) Cash
Requirements





Estimated
future cash requirements





As
discussed above DSEN intends to meet its financial needs for operations through
the collection of accounts receivable and servicing of current
contracts.





The
Registrant’s capital resources are comprised primarily of private investors, who
are either existing contacts of the Registrant’s management or who come to the
attention of the Registrant through brokers, financial institutions and other
intermediaries. The Registrant’s access to capital is always dependent upon
general financial market conditions. The Registrant’s capital resources are not
anticipated to change materially in 2010.





DSEN has
financed operations through the collections of accounts receivable, servicing of
existing contracts and the sale of common stock and through financing from
financial institutions. In order to sustain operations in the near term, it is
anticipated that DSEN has sufficient working capital in that it has a
receivables purchase line with Wells Fargo.




16




DSEN’s
future capital requirements will depend on numerous factors, including the
profitability of our research projects and our ability to control costs. We
believe that our current assets will be sufficient to meet our operating
expenses and capital expenditures. However, we cannot predict when and if any
additional capital contributions may be needed and we may need to seek one or
more substantial new investors. New investors could cause substantial dilution
to existing stockholders.





There can
be no assurances that DSEN will be successful in raising additional capital via
debt or equity funding, or that any such transactions, if consummated, will be
on terms favorable to DSEN. In the event that additional capital is not obtained
from other sources, it may become necessary to alter development plans or
otherwise abandon certain ventures.





If DSEN
needs to raise additional funds in order to fund expansion, develop new or
enhanced services or products, respond to competitive pressures or acquire
complementary products, businesses or technologies, any additional funds raised
through the issuance of equity or convertible debt securities, the percentage
ownership of the stockholders of DSEN will be reduced, stockholders may
experience additional dilution and such securities may have rights, preferences
or privileges senior to those of DSEN’s Common Stock.





DSEN has
a contractual restriction on its ability to incur debt. Pursuant to subscription
agreement for this funding, DSEN cannot enter into any further equity or
convertible debt financings, without consent, until the date the notes has been
fully paid.





A result
of this restriction is that any additional funds needed with most likely have to
be provided by the current note holders or would require their consent. The
Company is also exploring a receivables based secured credit
facility.





In the
event that we are required to repay the balance of these notes in cash on
demand, we would be forced to seek additional funding which would probably be at
a large discount. If we were unable to obtain the additional funding, we may be
forced to close down operations (see risk factors for addition
discussion).





Expected
Significant Changes in the Number of Contract Workers





DSEN does
not expect any significant change in the number of contract workers over the
next 12 months of operations. As noted previously, DSEN currently coordinates
most operations using part time employees, consultants and contract
labor.





In the
next twelve months, the Company’s focus is on expanding our client base to meet
or exceed the capacity that our new space provides us, while also seeking a
strategic acquisition.





Managements
Discussion and Analysis of Financial Condition and Results of
Operations




For the calendar year ended December
31, 2009, the Company generated $14,814,100 in revenues as compared to
$18,056,808 during the calendar year ended December 31, 2008, a decrease of
$3,242,708 or 18.0%. For the calendar year ended December 31, 2009, the
Company’s cost of goods sold was $12,191,404 as compared to $15,955,766 during
the calendar year ended December 31, 2008, a decrease of $3,764,362 or 23.6 %.
For the calendar year ended December, 31, 2009, the Company generated a gross
profit of $2,622,696 compared to $2,101,042 for the calendar year ended December
31, 2008, an increase of  $521,654 or 24.8%. The decrease in revenue
and in cost of goods sold resulted primarily due to the current general economic
downturn which has affected its customers resulting in less outsourcing for
services provided by the Company.  The increase in gross profit is due
to steps management has taken to reduce operating costs along with increasing
hourly productivity on work done for clients.   For the calendar
year ended December 31, 2009, the Company has increased its working capital
position by $352,859 from $(1,369,443) as of December 31, 2008 to $ (1,016,584)
as of December 31,
2009.




17





Analysis
of the calendar year ended December 31, 2009 compared to the calendar year ended
December 31, 2008.





The
Company had a net loss of $533,171 for the calendar year ended December 31, 2009
compared to a net loss of $6,503,644 for the calendar year ended December 31,
2008, a decrease in net loss of $5,970,473. The decrease in net loss was
attributable to the non write-off of certain assets as in 2008 and the steps
management took in 2009 to reduce operating costs along with general
administrative costs.





Total
expenses decreased to $2,690,690 for the calendar year ended December 31, 2009
from $3,184,560 for the calendar year ended December 31, 2008, a decrease of
$493,870. The decrease in expenses related to the reduction in executive staff
salaries and benefits along with a cost cutting measures related to all aspects
of the operations of the company.





Depreciation
expense for the calendar year ended December 31, 2009 was $397,147 compared to
$381,245 for the calendar year ended December 31, 2008, an increase of
$15,902.





Interest
expense for the calendar year ended December 31, 2009 was $674,238 compared to
$1,087,403 for the calendar year ended December 31, 2008 a decrease of
$413,165.  The company was able to reduce its interest rate on its
convertible debt along with paying off many small loans.  In addition
the interest paid to Wells Fargo Business Credit was less than paid to Comerica
Bank as Wells Fargo purchases the company’s invoices as opposed to a line of
credit that the Company had with Comerica Bank.  Due to the reduction
in revenues there was a reduction in the interest paid.





Liquidity and Capital Resources





Liquidity





For the
calendar year ended December 31, 2009, the Company has increased its working
capital position by $352,859 from $(1,369,443) as of December 31, 2008 to
$(1,016,584) as of December 31, 2009 as a result of the Convertible Debt Holders
extending the maturity date on the payoff of the debt to March 31,
2011.





Management
believes that its revenues from operations and collections on accounts
receivable will meet its minimum general and administrative cost requirements
and provide the basic liquidity DSEN needs to operate at current levels over the
next twelve months.





Although
we believe the additional capital we will require will be provided either
through new equity investment, debt and/or increased revenue from the sale of
our services, we cannot assure that the equity investment will be made, we can
obtain debt at acceptable terms or that we can generate sufficient revenue to
maintain projected operating levels.  Accordingly, we may need to try
to secure additional equity or debt financing which we cannot assure would be
available to us at prices that would be acceptable.





Wells
Fargo





On
November 7, 2008, the Company entered into an Account Purchase Agreement
(“Agreement”) with Wells Fargo Bank, National Association (“Wells Fargo”)
pursuant to which Wells Fargo has agreed to purchase certain accounts receivable
from the Company from time to time, up to $4.5 million, at a price equal to the
face value of each such receivable less a discount equal to .5% plus the then
existing prime rate, plus three percent plus other fees and charges. Any
accounts sold to Wells Fargo for which payment is not received within the
proscribed time periods in the Agreement shall be subject to repurchase by the
Company. To secure this repurchase and other obligations of the Company there
under, the Company granted a first lien on all of its assets to Wells Fargo. In
connection therewith, the Longview Fund and Alpha Capital Anstalt agreed to
subordinate their security interests in the Company’s collateral to the security
interests of Wells Fargo.




18





The short
term source of liquidity is from operations. Any long term needs that are above
and beyond what is derived from operations would come from outside sources. The
long term needs and possible sources of funds are not identified at this time.
If required, DSEN could stop growing and hold operations at the current level
without any need for additional funding. However, additional funding will be
required to execute its business plan of expanding the Costa Rica operations in
order to expand the inbound call center initiative above what was accomplished
in 2007 in terms of utilizing capacity at its new facility. The balance of the
funding required to execute DSEN’s planning will need to be obtained from other
sources such as debt or the sale of additional equity.




The call
center initiative is as follows: we currently utilize the majority of our
interviewing stations for no more than six hours per day. The majority of those
six hour shifts are during the early afternoon/evening. We are pursuing day time
work.





On
December 31, 2009 DSEN had total assets of $2,352,252 compared to $3,141,150 on
December 31, 2008, a decrease of $788,898. The decrease in assets is the result
of a decrease in accounts receivable due to decreased revenues along with a
reduction in net property and equipment due to depreciation
expense  DSEN had a total stockholders’ equity (deficit) of
$(4,326,577) on December 31, 2009 compared to ($3,775,137) on December 31, 2008,
a decrease in equity of $551,440.





Capital
Resources





The
Registrant’s capital resources are comprised primarily of private investors,
including members of management, who are either existing contacts of
Datascension’s management or who come to the attention of the Registrant through
brokers, financial institutions and other intermediaries. Datascension’s access
to capital is always dependent upon general financial market conditions,
especially those which pertain to venture capital situations.





Material
Commitments for Capital Expenditures.





The
Company has made no material commitments for future expansion. When potential
expansion or the need for expansion arises, management reviews the potential of
each property as its leases come up for renewal and makes a decision whether or
not to renew each lease or expand the current facilities, in light of the
Company’s business planning at that time.





The
Registrant has no agreements with management, investors, shareholders or anyone
else respecting additional financing at this time. Because of the nature of the
Registrant’s business, there are no trends in the nature of its capital
resources which could be considered predictable.





Inflation





The
Company’s results of operations have not been affected by inflation; however,
management does expect inflation may have a material impact on its
operations in the future.





Off-Balance
Sheet Arrangements.





The
company currently does not have any off-balance sheet arrangements.




19





Safe
Harbor





The
discussions of the results of operations and financial condition of the Company
should be read in conjunction with the financial statements and notes pertaining
to them that appear elsewhere in this Form 10-K. Statements made in this Form
10-K that are not historical or current facts are “forward- looking statements”
made pursuant to the safe harbor provisions of Section 27A of the Securities Act
of 1933 (the “Act”) and Section 21E of the Securities Exchange Act of 1934.
These statements often can be identified by the use of terms such as “may,”
“will,” “expect,” “believe,” “anticipate,” “estimate,” “approximate” or
“continue,” or the negative thereof. The Company intends that such
forward-looking statements be subject to the safe harbors for such statements.
The Company wishes to caution readers not to place undue reliance on any such
forward-looking statements, which speak only as of the date made. Any
forward-looking statements represent management’s best judgment as to what may
occur in the future. However, forward-looking statements are subject to risks,
uncertainties and important factors beyond the control of the Company that could
cause actual results and events to differ materially from historical results of
operations and events and those presently anticipated or projected. These
factors include adverse economic conditions, risks of foreign operation, entry
of new and stronger competitors, inadequate capital and unexpected costs. The
Company disclaims any obligation subsequently to revise any forward-looking
statements to reflect events or circumstances after the date of such statement
or to reflect the occurrence of anticipated or unanticipated
events.




ITEM 6.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.





TABLE OF
CONTENTS





PAGEReport of Independent Registered Public
      Accounting Firm
            
            
            F-1Independent
      Auditors Report - 2007 & 2008FINANCIAL
      STATEMENTS:Balance
      Sheets
            
            
            F-2Statements
      of Operations
            
            
            F-3Statement
      of Changes in Stockholders’ (Deficit) Equity
            
            
            F-4Statements
      of Cash Flows
            
            
            F-5NOTES
      TO FINANCIAL STATEMENTS:
            
            F-6
      to F-20




20





KBL, LLPCERTIFIED
      PUBLIC ACCOUNTANTS & ADVISORSREPORT
      OF REGISTERED PUBLIC ACCOUNTING
FIRM




To the
Board of Directors


Datascension,
Inc.


Las
Vegas, Nevada





We have
audited the accompanying balance sheets of Datascension, Inc., as of December
31, 2009 and 2008, and the related consolidated statements of operations,
changes in stockholders’ (deficit) equity, and cash flows for the year then
ended. These financial statements are the responsibility of the Company’s
management. Our responsibility is to express an opinion on these financial
statements based on our audit.





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





In our
opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of Datascension, Inc. as of December
31, 2009 and 2008  and the results of its operations and cash flows
for the year then ended in conformity with accounting principles generally
accepted in the United States.




/s/
      KBL, LLPApril
      14, 2010




F-1




DATASCENSION,
      INCCONSOLIDATED
      BALANCE SHEETS




12/31/2009
                
                
                12/31/2008AUDITED
                
                
                AUDITEDASSETSCurrent
      assets:Cash
                
                $
                -
                
                
                $
                73,713Accounts
      receivable
                
                
                919,717
                
                
                
                1,303,960Prepaid
      expenses
                
                
                15,587
                
                
                
                14,322Total
      current assets
                
                
                935,304
                
                
                
                1,391,995Property
      and equipment, net of accumulated depreciation of $1,184,432 and $787,285,
      respectively
                
                
                1,303,566
                
                
                
                1,633,139Other
      assetsDeposits
                
                
                113,382
                
                
                
                116,016Total
      other assets
                
                
                113,382
                
                
                
                116,016Total
      Assets
                
                $
                2,352,252
                
                
                $
                3,141,150LIABILITIES
      & STOCKHOLDERS' (DEFICIT) EQUITYCurrent
      liabilitiesCash
      overdraft
                
                $
                54,790
                
                
                $
                -Accounts
      payable
                
                
                266,320
                
                
                
                490,845Accrued
      expenses
                
                
                1,130,778
                
                
                
                2,197,641Short-term
      notes payable
                
                
                500,000
                
                
                
                17,464Current
      portion of long term debt
                
                
                -
                
                
                
                55,488Total
      liabilities
                
                
                1,951,888
                
                
                
                2,761,438Long
      term debtNote
      payable with CCSS
                
                
                481,811
                
                
                
                -Long
      term debt notes payable
                
                
                4,245,130
                
                
                
                4,154,849Total
      long term debt
                
                
                4,726,941
                
                
                
                4,154,849Total
      liabilities
                
                
                6,678,829
                
                
                
                6,916,287Stockholders'
      (deficit) equity :Preferred
      stock, Series B, $0.001 par value, 20,000,000 shares authorized, none and
      505,900 shares issued and outstanding at December 31, 2009 and
      2088
                
                
                -
                
                
                
                506Additional
      paid-in capital, preferred Series B
                
                
                -
                
                
                
                481,994Preferred
      stock, Series C
                
                
                1
                
                
                
                1Additional
      paid-in capital, preferred Series C
                
                
                14,999
                
                
                
                14,999Common
      shares, $.001 par value, 200,000,000 shares authorized: 21,407,361 and
      21,307,361 issued and outstanding at December 31, 2009 and December 31,
      2008 respectively
                
                
                21,407
                
                
                
                21,307Additional
      paid-in capital
                
                
                16,825,908
                
                
                
                16,361,777Treasury
      stock (15,095,833 shares), at cost
                
                
                (134,388
                )
                
                
                (134,388
                )Accumulated  deficit
                
                
                (21,054,504
                )
                
                
                (20,521,333
                )Total
      stockholders' deficit
                
                
                (4,326,577
                )
                
                
                (3,775,137
                )Total
      liabilities and stockholders' (deficit) equity
                
                $
                2,352,252
                
                
                $
                3,141,150


See
accompanying notes


F-2




DATASCENSION,
      INCCONSOLIDATED
      STATEMENTS OF OPERATIONS




For
      the year
              
              
              For
      the yearended
              
              
              ended12/31/2009
              
              
              12/31/2008AUDITED
              
              
              AUDITEDRevenue
              
              $
              14,814,100
              
              
              $
              18,056,808Cost
      of good sold
              
              
              12,191,404
              
              
              
              15,955,766Gross
      profit
              
              
              2,622,696
              
              
              
              2,101,042Expenses:Selling,
      general and administrative
              
              
              2,293,543
              
              
              
              2,803,315Depreciation
      and amortization
              
              
              397,147
              
              
              
              381,245Total
      expense
              
              
              2,690,690
              
              
              
              3,184,560Operating
      income (loss)
              
              
              (67,994
              )
              
              
              (1,083,518
              )Other
      income (expense):Loss
      on write-off of goodwill
              
              
              -
              
              
              
              (1,692,782
              )Loss
      on write-off of property and equipment
              
              
              -
              
              
              
              (2,606,644
              )Loss
      on write-off of website assets
              
              
              -
              
              
              
              (3,207
              )Loss
      on existing non-cancellable operating lease
              
              
              -
              
              
              
              (41,800
              )Other
      income
              
              
              61,814
              
              
              
              9,420Debt
      forgiveness
              
              
              147,247Interest
      expense
              
              
              (674,238
              )
              
              
              (1,087,403
              )Interest
      income
              
              
              -
              
              
              
              2,290Total
      other income (expense)
              
              
              (465,177
              )
              
              
              (5,420,126
              )Net
      loss
              
              $
              (533,171
              )
              
              $
              (6,503,644
              )Basic
      weighted average number of common shares outstanding
              
              
              21,328,457
              
              
              
              29,746,947Diluted
      weighted average number of common shares outstanding
              
              
              21,328,457
              
              
              
              29,746,947Basic
      net loss per share
              
              $
              (0.02
              )
              
              $
              (0.22
              )Diluted
      net loss per share
              
              $
              (0.02
              )
              
              $
              (0.22
              )


See
accompanying notes




F-3


DATASCENSION,
      INC.CONSOLIDATED
      STATEMENTS OF CHANGES IN STOCKHOLDERS' (DEFICIT) EQUITYFOR
      THE YEARS ENDED DECEMBER 31, 2007, 2008 AND
2009




Preferred
      Stock Shares Series B
                  
                  Preferred
      Stock Series B
                  
                  Preferred
      Stock Series B Paid-in Capital
                  
                  
                  Preferred
      Stock Shares Series C
                  
                  Preferred
      Stock Series C
                  
                  Preferred
      Stock Series C Paid-in Capital
                  
                  Common
      Stock Shares
                  
                  Common
      Stock Amount
                  
                  Additional
      Paid-in Capital
                  
                  Treasury
      Stock
                  
                  Income
      (Deficit)
                  
                  Total
                    EquityBalance
      at December 31, 2007
                  
                  
                  505,900
                  
                  $
                  506
                  
                  
                  481,994
                  
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  35,775,972
                  
                  $
                  35,776
                  
                  $
                  16,188,782
                  
                  $
                  (134,388
                  )
                  $
                  (14,017,689
                  )
                  $
                  2,554,981Stock
      issued in settlement of interest
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  221,389
                  
                  
                  221
                  
                  
                  77,605
                  
                  
                  
                  
                  
                  
                  
                  
                  77,826Stock
      issued for services
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  310,000
                  
                  
                  310
                  
                  
                  95,390
                  
                  
                  
                  
                  
                  
                  
                  
                  95,700Stock
      converted into Series C Preferred Stock
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  1,000
                  
                  
                  1
                  
                  
                  14,999
                  
                  
                  (15,000,000
                  )
                  
                  (15,000
                  )Net
      loss for the year ended December 31, 2008
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  (6,503,644
                  )
                  
                  (6,503,644
                  )Balance
      at December 31, 2008
                  
                  
                  505,900
                  
                  $
                  506
                  
                  $
                  481,994
                  
                  
                  
                  1,000
                  
                  $
                  1
                  
                  $
                  14,999
                  
                  
                  21,307,361
                  
                  $
                  21,307
                  
                  $
                  16,361,777
                  
                  $
                  (134,388
                  )
                  $
                  (20,521,333
                  )
                  $
                  (3,775,137
                  )Stock
      issued for services
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  100,000
                  
                  
                  100
                  
                  
                  2,900
                  
                  
                  
                  
                  
                  
                  
                  
                  3,000Repurchase
      and settlement of preferred stock Series B
                  
                  
                  (505,900
                  )
                  
                  (506
                  )
                  
                  (481,994
                  )
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  461,231
                  
                  
                  
                  
                  
                  
                  
                  
                  (21,269
                  )Net
      loss for the year ended December 31, 2009
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  (533,171
                  )
                  
                  (533,171
                  )Balance
      at December 31, 2009
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  
                  1,000
                  
                  $
                  1
                  
                  $
                  14,999
                  
                  
                  21,407,361
                  
                  $
                  21,407
                  
                  $
                  16,825,908
                  
                  $
                  (134,388
                  )
                  $
                  (21,054,504
                  )
                  $
                  (4,326,577
                  )




See
accompanying notes




F-4


DATASCENSION,
      INCCONSOLIDATED
      STATEMENTS OF CASH FLOWS




For
      the year
              
              
              For
      the yearended
              
              
              ended12/31/2009
              
              
              12/31/2008AUDITED
              
              
              AUDITEDCash
      flows from operating activitiesNet
      (loss)
              
              $
              (533,171
              )
              
              $
              (6,503,644
              )Adjustments
      to reconcile net loss to net cash (used in) provided by operating
      activities:Depreciation
      and amortization
              
              
              397,147
              
              
              
              381,245Loss
      on write-off of goodwill
              
              
              -
              
              
              
              1,692,782Loss
      on write-off of property and equipment
              
              
              -
              
              
              
              2,606,644Loss
      on write-off of website assets
              
              
              -
              
              
              
              3,207Settlement
      of Series B preferred stock
              
              
              (21,269
              )Issuance
      of common stock for services and debt (cancellation)
              
              
              3,000
              
              
              
              173,526Correction
      of prior years financial statements to reflect properConsolidation
      of the subsidiary balance sheet and the elimination of parent entity
      investment in that subsidiary
              
              
              -
              
              
              
              (810,982
              )Decrease
      in accounts receivable
              
              
              384,243
              
              
              
              1,767,804Decrease
      in related party receivable
              
              
              -
              
              
              
              1,530,124(Increase)
      decrease in prepaid expenses
              
              
              (1,265
              )
              
              
              42,344Decrease
      (increase) in deposits
              
              
              2,634
              
              
              
              (100,398
              )Increase
      in cash overdraft
              
              
              54,790
              
              
              
              -(Decrease)
      increase in accounts payable
              
              
              (224,525
              )
              
              
              174,492(Decrease)
      increase in accrued expenses
              
              
              (1,066,863
              )
              
              
              1,706,058Net
      cash (used in) provided by operating activities
              
              
              (1,005,279
              )
              
              
              2,663,202Cash
      flows from investing activities:Purchase
      of property and equipment
              
              
              (67,574
              )
              
              
              (1,290,696
              )Net
      cash used by investing activities
              
              
              (67,574
              )
              
              
              (1,290,696
              )Cash
      flows from financing activities:Increase
      (decrease) in short-term notes payable
              
              
              427,048
              
              
              
              (18,035
              )Increase
      (decrease) in loan payable to Comerica Bank
              
              
              -
              
              
              
              (1,727,688
              )Increase
      in long-term debt
              
              
              572,092
              
              
              
              -Proceeds
      of issuance of convertible debt
              
              
              -
              
              
              
              400,000Net
      cash provided by (used in) financing activities
              
              
              999,140
              
              
              
              (1,345,723
              )Net
      (decrease) increase in cash
              
              
              (73,713
              )
              
              
              26,783Cash
      balance - beginning of year
              
              
              73,713
              
              
              
              46,930Cash
      balance - end of year
              
              $
              -
              
              
              $
              73,713Interest
      paid
              
              $
              580,011
              
              
              $
              181,168Taxes
      paid
              
              $
              -
              
              
              $
              -


See
accompanying notes




F-5




DATASCENSION,
INC.


NOTES TO
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS





NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS





Note 1 -
HISTORY AND ORGANIZATION OF THE COMPANY





Datascension,
Inc. (formerly known as Nutek, Inc.) was incorporated in August 1991 under the
laws of the State of Nevada as Swiss Technique, Inc. (the “Company”) and is
engaged in the market research industry.





Datascension
International, Inc. and related assets were purchased on September 27, 2001 for
$2,200,000 using company shares at fair market value. Datascension is a data
solutions company representing a unique expertise in the collecting, storage,
processing, and interpretation of data. During 2002, Datascension expanded
operations into Costa Rica where it has continued to conduct most of its
operations.





Effective
July 1, 2009, the Company adopted The “FASB Accounting Standards
Codification” and the Hierarchy of Generally Accepted Accounting Principles (ASC
105-10), (formerly SFAS No. 168, The “FASB Accounting Standards
Codification” and the Hierarchy of Generally Accepted Accounting Principles).
This standard establishes only two levels of U.S. generally accepted accounting
principles (“GAAP”), authoritative and non authoritative. The Financial
Accounting Standard Board (“FASB”) Accounting Standards Codification (the
“Codification”) became the source of authoritative, nongovernmental GAAP, except
for rules and interpretive releases of the SEC, which are sources of
authoritative GAAP for SEC registrants. All other non-grandfathered, non-SEC
accounting literature not included in the Codification became non authoritative.
The Company began using the new guidelines and numbering system prescribed by
the Codification when referring to GAAP in the third quarter of fiscal 2009. As
the Codification was not intended to change or alter existing GAAP, it did not
have any impact on the Company’s condensed consolidated financial
statements.





NOTE 2 -
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES





Basis of
Accounting





The
Company’s policy is to prepare the financial statements on the accrual basis of
accounting. The fiscal year end is December 31.





Cash and
Cash Equivalents





The
Company considers all highly liquid debt instruments and other short-term
investments with an initial maturity of three months or less to be cash
equivalents.  Any amounts of cash in financial institutions over FDIC
insured limits, exposes the Company to cash concentration risk.





Comprehensive
Income





The
Company adopted ASC 220-10, “Reporting Comprehensive Income,” (formerly SFAS No.
130). ASC 220-10 requires the reporting of comprehensive income in addition to
net income from operations.





Comprehensive
income is a more inclusive financial reporting methodology that includes
disclosure of information that historically has not been recognized in the
calculation of net income.




F-6





Fair
Value of Financial Instruments (other than Derivative Financial
Instruments)





The
carrying amounts reported in the balance sheets for cash and cash equivalents,
accounts receivable and accounts payable approximate fair value because of the
immediate or short-term maturity of these financial instruments.  For
the notes payable, the carrying amount reported is based upon the incremental
borrowing rates otherwise available to the Company for similar
borrowings.





Consolidation
Policy





The
accompanying consolidated financial statements include the accounts of
Datascension, Inc. and Datascension International, Inc. Datascension
International, Inc. was merged into the Company during 2008.  All
significant inter-company balances and transactions have been
eliminated.





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 disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period.  On an on-going basis, the Company
evaluates its estimates, including, but not limited to, those related to
investment tax credits, bad debts, income taxes and contingencies. The Company
bases its estimates on historical experience and on various other assumptions
that are believed to be reasonable under the circumstances, the results of which
form the basis for making judgments about the carrying value of assets and
liabilities that are not readily apparent from other sources. Actual results
could differ from those estimates.





Income
taxes:




The
Company accounts for income taxes as codified in ASC 740-10-05 (formerly SFAS
109, “Accounting for Income Taxes” and FASB Interpretation No. 48, “Accounting
for Uncertainty in Income Taxes,” an interpretation of SFAS No. 109,
“Accounting for Income Taxes”). Deferred tax assets or liabilities are recorded
to reflect the future tax consequences of temporary differences between the
financial reporting basis of assets and liabilities and their tax basis at each
year-end. These amounts are adjusted, as appropriate, to reflect enacted changes
in tax rates expected to be in effect when the temporary differences
reverse.





The
Company records deferred tax assets and liabilities based on the differences
between the financial statement and tax bases of assets and liabilities and on
operating loss carry forwards using enacted tax rates in effect for the year in
which the differences are expected to reverse. A valuation allowance is provided
when it is more likely than not that some portion or all of a deferred tax asset
will not be realized.





Fixed
Assets





Fixed
assets are stated at cost. Expenditures that materially increase the life of the
assets are capitalized. Ordinary maintenance and repairs are charged to expense
as incurred. When assets are sold or otherwise disposed of, the cost and the
related accumulated depreciation and amortization are removed from the accounts
and any resulting gain or loss is recognized at that time.





Depreciation
is computed primarily on the straight-line method for financial statement
purposes over the following estimated useful lives:




Leasehold
      improvements
            6.25
      yearsComputer
      equipment
            5
      yearsFurniture
      and fixtures
            5-10
      yearsOffice
      equipment
            5
      years





F-7




Revenue
Recognition





We
recognize revenues when survey data is delivered to the client in accordance
with the terms of our agreements. Research products are delivered within a short
period, generally ranging from a few days to approximately eight weeks. An
appropriate deferral is made for direct costs related to contracts in process,
and no revenue is recognized until delivery of the data has taken place.
Billings rendered in advance of services being performed, as well as customer
deposits received in advance, are recorded as a current liability included in
deferred revenue. We are required to estimate contract losses, if any, and
provide for such losses in the period they are determined and estimable. We do
not believe that there are realistic alternatives to our revenue recognition
policy given the short period of service delivery and the requirement to deliver
completed surveys to our customers. We do not believe there is significant risk
of recognizing revenue prematurely since our contracts are standardized, the
earnings process is short, and no single project accounts for a significant
portion of our revenue.





Goodwill
and Other Intangible Assets





In
accordance with ASC 350- 30-65 (formerly SFAS 142, “Goodwill and Other
Intangible Assets”, the Company assesses the impairment of identifiable
intangibles whenever events or changes in circumstances indicate that the
carrying value may not be recoverable. Intangible assets were comprised of
website assets. Factors the Company considers to be important which could
trigger an impairment review include the following:





1.
            Significant
      underperformance relative to expected historical or projected future
      operating results;





2.
            Significant
      changes in the manner of use of the acquired assets or the strategy for
      the overall business; and





3.
            Significant
      negative industry or economic
trends.





When the
Company determines that the carrying value of intangibles may not be recoverable
based upon the existence of one or more of the above indicators of impairment
and the carrying value of the asset cannot be recovered from projected
undiscounted cash flows, the Company records an impairment charge. The Company
measures any impairment based on a projected discounted cash flow method using a
discount rate determined by management to be commensurate with the risk inherent
in the current business model. Significant management judgment is required in
determining whether an indicator of impairment exists and in projecting cash
flows. A provision for the write down of goodwill and website asset costs had
been made during the year ended December 31, 2008 and is summarized in Note
13.





Long-Lived
Assets





In
accordance with ASC 360 (formerly FASB Statement 144,Accounting for the Impairment or
Disposal of Long-Lived Assets), the carrying value of intangible assets
and other long-lived assets are reviewed, such as other properties and
equipment, on a regular basis for the existence of facts or circumstances that
may suggest impairment. The Company recognizes impairment when the sum of the
expected undiscounted future cash flow is less than the carrying amount of the
asset. The Company measures impairment losses, if any, as the excess of the
carrying amount of the asset over its estimated fair value. A provision for the
write down of property and equipment asset costs had been made during the year
ended December 31, 2009 and is summarized in Note 10 herein below.





Foreign
Currency Translation





The
Company’s functional currency is the U.S. dollar. In those instances where DSEN
has foreign currency transactions, the financial statements are translated to
U.S. dollars in accordance with ASC 830 (formerly Statement 52 of the Financial
Accounting Standards Board (FASB), Foreign Currency
Translation).  Monetary assets and liabilities denominated in foreign
currencies are translated using the exchange rate prevailing at the balance
sheet date. Gains and losses arising on translation or settlement of
foreign-currency-denominated transactions or balances are included in the
determination of income. The Company’s primary foreign currency transactions are
in Costa Rica Colon. The Company has not entered into derivative instruments to
offset the impact of foreign currency fluctuations. The Company has had nominal
translation or transactions gains or losses of substance to reflect during the
year ended December 31, 2009 and 2008.




F-8





Net
Loss Per Share





Basic net
loss per share is computed using the weighted average number of shares of common
stock outstanding for the period end. The net loss for the period end is divided
by the weighted average number of shares outstanding for that period to arrive a
net loss per share.





Diluted
net loss per share reflects the potential dilution that could occur if the
securities or other contracts to issue common stock were exercised or converted
into common stock.





Advertising





Advertising
costs are expensed when incurred. Advertising for the year ended December 31,
2009 and the year ended December 31, 2008 amounted to $ 17,832 and $36,267,
respectively.




Research
and Development





The
Company expenses its research and development in the periods
incurred.





Segment
Information





The
Company follows the provisions of ASC 280-10, “Disclosures about Segments of an
Enterprise and Related Information”. This standard requires that companies
disclose operating segments based on the manner in which management
disaggregates the Company in making internal operating
decisions.





Concentrations
of Credit Risk





Credit
risk represents the accounting loss that would be recognized at the reporting
date if counter parties failed completely to perform as contracted.
Concentrations of credit risk (whether on or off balance sheet) that arise from
financial instruments exist for groups of customers or counter parties when they
have similar economic characteristics that would cause their ability to meet
contractual obligations to be similarly affected by changes in economic or other
conditions described below.





The
Company operates in one segment, the market research industry. 100% of the
Company’s customers are located within the United States of
America.





Accounts
Receivable




Accounts
receivable are stated at the amount management expects to collect from
outstanding balances. Management provides for probable uncollectible amounts
through a charge to earnings and a credit to a valuation allowance based on its
assessment of the current status of individual accounts. Balances outstanding
after management has used reasonable collection efforts are written off through
a charge to the valuation allowance and a credit to trade accounts receivable.
Changes in the valuation allowance have not been material to the financial
statements.




F-9





Stock
Based Compensation





The
Company applies ASC 718-10 and
ASC 505-50 (formerlySFAS 123R) in accounting
for stock options issued to employees. For stock options and warrants issued to
non-employees, the Company applies the same standard, which requires the
recognition of compensation cost based upon the fair value of stock options at
the grant date using the Black-Scholes option pricing model.





Major
Customers





During
the year ended December 31, 2009, the Company had three major clients, Synovate
(12.2%), AdMax Media Inc.10.9%), and  Sandelman & Associates
(8.6%).  Management believes the loss of one of these key clients
would materially affect the operations of the Company in the short
term.





During
the year ended December 31, 2008, the Company had three major clients,
Ipsos-Reid (15.0%), Synovate  (11.5%), and Nielsen (8.3%). Management
believed the loss of one of these key clients would materially affect the
operations of the Company in the short term.





Recently Issued Accounting
Pronouncements




In
September 2006, the FASB issued ASC 820-10 (formerly FASB Statement 157, “Fair
Value Measurements”). ASC 820-10 defines fair value, establishes a framework for
measuring fair value under GAAP and expands disclosures about fair value
measurements.  ASC 820-10 applies under other accounting
pronouncements that require or permit fair value
measurements.  Accordingly, ASC 820-10 does not require any new fair
value measurements.  However, for some entities, the application of ASC
820-10 will change current practice.  The changes to current practice
resulting from the application of ASC 820-10 relate to the definition of fair
value, the methods used to measure fair value and the expanded disclosures about
fair value measurements.  The provisions of ASC 820-10 are effective as of
January 1, 2008, with the cumulative effect of the change in accounting
principle recorded as an adjustment to opening retained earnings.  However,
delayed application of this statement is permitted for nonfinancial assets and
nonfinancial liabilities, except for items that are recognized or disclosed at
fair value in the financial statements on a recurring basis (at least annually),
until fiscal years beginning after November 15, 2008, and interim periods within
those fiscal years.  The Company adopted ASC 820-10 effective January 1,
2008 for financial assets and the adoption did not have a significant effect on
its financial statements.  The Company has adopted the remaining provisions
of ASC 820-10 beginning in 2009. The adoption of SFAS No. 157 did not have a
material impact on the Company’s condensed consolidated results of operations or
financial condition.





In
February 2007, ASC issued 825-10, The Fair Value Option for Financial Assets and
Financial Liabilities – Including an amendment of ASC 320-10, (“ASC 825-10”)
which permits entities to choose to measure many financial instruments and
certain other items at fair value at specified election dates. A business entity
is required to report unrealized gains and losses on items for which the fair
value option has been elected in earnings at each subsequent reporting date.
This statement is expected to expand the use of fair value measurement. ASC
825-10 is effective for financial statements issued for fiscal years beginning
after November 15, 2007, and interim periods within those fiscal
years.





In
December 2007, ASC 808-10 (formerly EITF Issue No. 07-1, “Accounting for
Collaborative Arrangements”) was issued.  ASC 808-10 provides guidance
concerning: determining whether an arrangement constitutes a collaborative
arrangement within the scope of the Issue; how costs incurred and revenue
generated on sales to third parties should be reported in the income statement;
how an entity should characterize payments on the income statement; and what
participants should disclose in the notes to the financial statements about a
collaborative arrangement. The provisions of ASC 808-10 have been adopted in
2009. ASC 808-10 has had no impact on the Company’s condensed consolidated
financial statements.





F-10





In
December 2007, ASC 808-10 (formerly EITF Issue No.07-1, “Accounting for
Collaborative Arrangements”) was issued.  ASC 808-10 provides guidance
concerning: determining whether an arrangement constitutes a collaborative
arrangement within the scope of the Issue; how costs incurred and revenue
generated on sales to third parties should be reported in the income statement;
how an entity should characterize payments on the income statement; and what
participants should disclose in the notes to the financial statements about a
collaborative arrangement.  The provisions of ASC 808-10 have been
adopted in 2009.  ASC 808-10 has had no impact on the Company’s
condensed consolidated financial statements.





In
December 2007, the Company adopted ASC 805, Business Combinations (“ASC 805”).
ASC 805 retains the fundamental requirements that the acquisition method of
accounting be used for all business combinations and for an acquirer to be
identified for each business combination. ASC 805 defines the acquirer as the
entity that obtains control of one or more businesses in the business
combination and establishes the acquisition date as the date that the acquirer
achieves control.  ASC 805 will require an entity to record separately
from the business combination the direct costs, where previously these costs
were included in the total allocated cost of the acquisition.  ASC 805
will require an entity to recognize the assets acquired, liabilities assumed,
and any non-controlling interest in the acquired at the acquisition date, at
their fair values as of that date.  ASC 805 will require an entity to
recognize as an asset or liability at fair value for certain contingencies,
either contractual or non-contractual, if certain criteria are
met.  Finally, ASC 805 will require an entity to recognize contingent
consideration at the date of acquisition, based on the fair value at that
date.  This will be effective for business combinations completed on
or after the first annual reporting period beginning on or after December 15,
2008.  Early adoption is not permitted and the ASC is being applied
prospectively only.  Upon adoption of this ASC, there would be no
impact to the Company’s results of operations and financial condition for
acquisitions previously completed.  The adoption of ASC 805 is not
expected to have a material effect on the Company’s financial position, results
of operations or cash flows.





In March
2008, ASC issued ASC 815, Disclosures about Derivative Instruments and Hedging
Activities”, (“ASC 815”). ASC 815 requires enhanced disclosures about an
entity’s derivative and hedging activities. These enhanced disclosures will
discuss: how and why an entity uses derivative instruments; how derivative
instruments and related hedged items are accounted for and its related
interpretations; and how derivative instruments and related hedged items affect
an entity’s financial position, financial performance, and cash flows. ASC 815
is effective for financial statements issued for fiscal years and interim
periods beginning after November 15, 2008. The Company does not believe that ASC
815 will have an impact on their results of operations or financial
position.





In April
2008, ASC issued ASC 350, “Determination of the Useful Life of Intangible
Assets”.  This amends the factors that should be considered in
developing renewal or extension assumptions used to determine the useful life of
a recognized intangible asset under ASC 350.  The guidance is used for
determining the useful life of a recognized intangible asset shall be applied
prospectively to intangible assets acquired after adoption, and the disclosure
requirements shall be applied prospectively to all intangible assets recognized
as of, and subsequent to, adoption.  The Company does not believe ASC
350 will materially impact their financial position, results of operations or
cash flows.





ASC
470-20, “Accounting for Convertible Debt Instruments That May Be Settled in Cash
upon Conversion (Including Partial Cash Settlement)” (“ASC 470-20” requires the
issuer of certain convertible debt instruments that may be settled in cash (or
other assets) on conversion to separately account for the liability (debt) and
equity (conversion option) components of the instrument in a manner that
reflects the issuer’s non-convertible debt borrowing rate.  ASC 470-20
is effective for fiscal years beginning after December 15, 2008 on a retroactive
basis.  The Company does not believe that the adoption of ASC 470-20
will have a material effect on its financial position, results of operations or
cash flows.





In June
2008, the FASB ratified ASC 815-40-25 (formerly EITF Issue No. 07-05,
“Determining Whether an Instrument (or Embedded Feature) is indexed to an
Entity’s Own Stock”). ASC 815-40-25 mandates a two-step process for evaluating
whether an equity-linked financial instrument or embedded feature is indexed to
the entity’s own stock. Warrants that a company issues that contain a strike
price adjustment feature, upon the adoption of ASC 815-40-25, results in the
instruments no longer being considered indexed to the company’s own
stock.  On January 1, 2009, the Company adopted ASC 815-40-25 and
re-evaluated its issued and outstanding warrants that contain a strike price
adjustment feature. The Company reclassified certain warrants from equity to a
derivative liability and used the Black-Scholes valuation model to determine the
fair market value of the warrants.  Based upon the Company’s
re-evaluation, ASC 815-40-25 has had no material impact on the Company’s
condensed consolidated financial statements.




F-11





Effective June 15, 2009, the Company
adopted a new accounting standard for subsequent events, as codified in ASC
855-10 (formerly SFAS No. 165, Subsequent Events). The update modifies the
names of the two types of subsequent events either as recognized subsequent
events (previously referred to in practice as Type I subsequent events) or
non-recognized subsequent events (previously referred to in practice as Type II
subsequent events). In addition, the standard modifies the definition of
subsequent events to refer to events or transactions that occur after the
balance sheet date, but before the financial statements are issued (for public
entities) or available to be issued (for nonpublic entities). It also requires
the disclosure of the date through which subsequent events have been evaluated.
The update did not result in significant changes in the practice of subsequent
event disclosures, and therefore the adoption did not have any
impact on our condensed consolidated financial statements.  In
accordance with ASC 855-10, the Company evaluated all events or transactions
that occurred after December 31, 2009 up through April 14, 2010, the date the
Company issued these condensed consolidated financial statements.





Effective
July 1, 2009, the Company adopted The “FASB Accounting Standards
Codification” and the Hierarchy of Generally Accepted Accounting Principles (ASC
105-10), (formerly SFAS No. 168, The “FASB Accounting Standards
Codification” and the Hierarchy of Generally Accepted Accounting Principles).
This standard establishes only two levels of U.S. generally accepted accounting
principles (“GAAP”), authoritative and non authoritative. The Financial
Accounting Standard Board (“FASB”) Accounting Standards Codification (the
“Codification”) became the source of authoritative, nongovernmental GAAP, except
for rules and interpretive releases of the SEC, which are sources of
authoritative GAAP for SEC registrants. All other non-grandfathered, non-SEC
accounting literature not included in the Codification became non authoritative.
The Company began using the new guidelines and numbering system prescribed by
the Codification when referring to GAAP in the third quarter of fiscal 2009. As
the Codification was not intended to change or alter existing GAAP, it did not
have any impact on the Company’s condensed consolidated financial
statements.





Effective
for the interim reporting period ending June 30, 2009, the Company adopted two
new accounting standard updates which were intended to provide additional
application guidance and enhanced disclosures regarding fair value measurements
and impairments of securities as codified in ASC 820-10-65 (formerly FASB Staff
Position Financial Accounting Standard 107-1 and Accounting Principles Board
28-1 and “Interim Disclosures about Fair Value of Financial Instruments”. ASC
820-10-65 requires disclosures about fair value of financial instruments for
interim reporting periods of publicly traded companies as well as in annual
financial statements. ASC 820-10-65 requires related disclosures in summarized
financial information at interim reporting periods. ASC 820-10-65 was effective
for the interim reporting period ending June 30, 2009. The adoption of ASC
820-10-65 did not have a material impact on the Company’s condensed consolidated
financial statements.





In
January, 2010, The Company adopted FASB ASU No. 2010-06, Fair Value Measurement
and Disclosure (Topic 820) – Improving Disclosures about Fair Value Measurement
(“ASU 2010-06”).  These standards require new disclosures on the
amount and reason for transfers in and out of Level 1 and 2 fair value
measurements.  The standards also require new disclosures of
activities, including purchases, sales, issuances, and settlements with the
Level 3 fair value measurements.  The standard also clarifies existing
disclosure requirements on levels of disaggregation and disclosures about inputs
and valuation techniques.  These new disclosures are effective
beginning with the first interim filing in 2010.  The disclosures
about the roll forward of information in Level 3 are required for the Company
with its first interim filing in 2011.  The Company does not believe
this standard will impact their financial statements.  Other ASU’s
that have been issued or proposed by the FASB ASC that do not require adoption
until a future date and are not expected to have a material impact on the
financial statements upon adoption.




F-12





NOTE 3 –
PROPERTY AND EQUIPMENT





Property
and equipment are made up of the following as of December 31, 2009 and
2008:


Computer
      equipment
              
              $
              986,622
              
              
              $
              932,550Office
      equipment
              
              
              450,949
              
              
              
              464,991Leasehold
      improvements
              
              
              880,959
              
              
              
              880.959Vehicles
              
              
              154,983
              
              
              
              127,439Software
              
              
              14,485
              
              
              
              14,4852,487,998
              
              
              
              2,420,424Less
      accumulated depreciation and amortization
              
              
              1,184,432
              
              
              
              (787,285
              )$
              1,303,566
              
              
              $
              1,633,139





Depreciation
expense for the years ended December 31, 2009 and 2008 was $397,147 and
$381,245





NOTE 4 –
LONG-TERM DEBT





Effective
September 30, 2009, the Company’s two major creditors (other than Wells Fargo),
Longview Fund LP and Alpha Capital Anstalt, in order to assist the Company in
restructuring its balance sheet, agreed to modification of the terms of their
outstanding notes with the Company as detailed herein below.  The
purpose of the modifications and the concurrent restructuring of the Company’s
balance sheet are to both extend the terms of the notes in question so as to
ease the Company’s immediate burden to attempt to refinance the notes and as to
make the balance sheet presentation more palatable to potential investors and
clients of the Company.





Both
Longview Fund LP and Alpha Capital Anstalt have agreed to enter into an Allonge
No.4 to their existing notes, which capitalize all accrued and unpaid interest
on the notes, as well as to increase the balances to include interest payments
which would otherwise be due through December 2009.  The new interest
rate on the notes is 8% per annum, and the additions to principal balances for
interest due for the fourth quarter of 2009 are calculated at the new 8%
interest rate.





The
Principal amounts of the three allonges are as follows:




June
      12, 2006 Note Payable to the Longview Fund LP -
              
              $
              1,848,366December
      12, 2006 Note Payable to the Longview fund LP  -
              
              $
              1,356,894Note
      Payable to Alpha Capital Anstalt  -
              
              $
              1,039,870





The
allonges also extend the maturity date of the aforesaid notes to March 31,
2011.  The allonge to the December 12, 2006 Longview Fund LP note also
transforms the note into a convertible note on the same terms as the June 6,
2006  note except that the initial conversion price is $.10 per
share.





The
history of the previous notes is presented below.





Since
November 2004, the Company had entered into several different convertible debt
agreements, the most recent being December 12, 2006. In past funding
arrangements, the specific terms of the funding arrangements contained certain
covenants and liquidated damages which were deemed to make the notes be
considered non-conventional. Such treatment required a valuation of all
derivative items of the notes, which created a liability on the balance sheets,
coupled with a liability for the value of any warrants that were outstanding at
the balance sheet date. The December 2006 note settled all prior interest,
liquidated damages and other perceived “negative” items that were tainting the
debt. The latter note also served to amend and limit the liabilities, so as to
satisfy the EITF 00-27 requirements and end the requirement of the Company to
have the derivative accounting treatment.





Upon the
entering into of the December 2006 transaction, the Company removed all of the
prior derivative liability portions of the convertible debt, as all clauses had
been removed from the debts and agreements. This resulted in an expense to
remove the debt discounts that were previously being accreted, as well as the
financing costs being accreted over the remaining term. Concurrently, there was
an income item reported for a corresponding write off of the liabilities
associated with derivatives and the warrant liabilities on the
books.




F-13





In
November 2004, the Company issued $1,875,000 in principal amount of secured
promissory notes. As part of the financing transaction, the Company issued
warrants to purchase 3,125,000 shares of common stock at a per share purchase
price of $0.30 per share.





The Notes
accrue interest at a rate of prime + 3% per annum. The notes were due and
payable in November 2007. The notes were entered into pursuant to the terms of a
subscription agreement between the Company and the Holder.  The
$1,875,000 in proceeds from the financing transaction were originally allocated
to the debt features and to the warrants based upon their fair values. After the
latter allocations, there was $170,061 of remaining value to be allocated to the
long-term debt on the financial statements. The debt discount was being accreted
using the effective interest method over the term of the note.





In 2007,
6,559,919 shares were issued to settle $2,055,065 of principal and interest on
the convertible notes. An additional 2,841,667 shares were issued to satisfy
outstanding warrants.




LONGVIEW
FUND, L.P. AND ALPHA CAPITAL ANSTALT





In June
2006, the Company issued two secured convertible promissory notes. One note is
due to Long View Fund L.P. (“Longview”) and had a principal amount of
$1,702,859 and the other note due to Alpha Capital Anstalt (“Alpha”) had a
principal amount of $571,429. As part of the financing transaction, the Company
issued warrants to purchase 4,865,311 shares of common stock at a per share
purchase price of $0.40 per share.





The
$1,702,859 promissory note due Longview accrues interest at a rate of 6% per
annum. Interest is to be paid quarterly.  The note was due and payable
in June 2008. It was entered into pursuant to the terms of a subscription
agreement between the Company and the Holder.  The $1,702,859 in
proceeds from the financing transaction were allocated to the debt features and
to the warrants based upon their fair values. After the latter allocations,
there was $318,796 of remaining value to be allocated to the long-term debt in
the financial statements. The debt discount was being accreted using the
effective interest method over the term of the note.





In
December, 2007, accrued interest of $25,753 was added to the note due to
Longview increasing the principal amount of the note to $1,728,612. The $571,429
promissory note due to Alpha accrued interest at a rate of 6% per annum. The
interest rate on this note had increased to the 10% default rate prior to
January 1, 2009 but was decreased to the original interest rate at January 1,
2009.





The note
holders have extended the due date of the notes to January 15,
2010.  In September, 2009, the note holders extended the due date of
the notes to March 31, 2011.





In
December 2006, the Company issued $2,065,458 in principal amount in a secured
promissory note to Longview. As part of the financing transaction, 1,280,000
warrants were issued to the note holder of the December 2006 notes with a 5 year
term and a $0.45 exercise price. In 2007, the note holder converted some debt
and interest into shares of stock along with the exercise of the warrants which
were attached to the note.





The note
due Longview described in the preceding paragraph accrues interest at a rate 14%
per annum. The note was due and payable in December 2008.  This note
is not convertible into common stock of the Company. Upon issuance, the Company
allocated $1,867,328 to the debt and $198,130 to the warrants based on the
relative fair values of each. The value of the warrants was determined using 56%
volatility, five year terms, and a $0.45 exercise price. The debt discount of
$198,130 was amortized over the two year term of the note.




F-14





In
September 2009 accrued interest of $163,251 was added to the note due to
Longview increasing the amount of the note at September 30, 2009 to $1,356,894.
The note is unpaid at December 31, 2009





Longview,
as the note holder, has extended the due date of the remainder due on the note
to March 31, 2011.





In
December, 2007, the Company issued a secured promissory note to Alpha Capital
Anstalt in the amount of $103,665 at an interest rate of 14% per annum. This
note was for interest and penalties that had accrued previously.  The
interest rate on this note had increased to the 18% default rate prior to
January 1, 2009.  After January 1, 2009 the interest rate is 14% per
annum.





Below is
a summary of secured convertible promissory notes payable due to Longview and
Alpha and related accrued interest payable at December 31, 2009.





Longview





Notes
            
            $
            3,205,260Accrued
      interest payable
            
            
            0$
            3,205,260





Alpha





Notes
            
            $
            1,039,870Accrued
      interest payable
            
            
            0$
            1,039,870





Interest
expenses incurred for the year ended December 31, 2009 on the above tabled debt
due to Longview and Alpha is as follows:





Longview
            
            $
            202,566Alpha
            
            
            48,277$
            250,843





On March
31, 2009, The Company entered into Waiver of Default Interest Agreements with
each of Longview Fund, L.P. and Alpha Capital Anstalt.  These
Agreements call for the making of two monthly interest payments at no defaulted
interest rates to each of Longview Fund and Alpha Capital until all past due
interest is paid in full to each of Longview Fund and Alpha Capital and in
consideration of these payments being made, both companies have agreed to waive
default interest rates and additional interest owed due to the otherwise
increase of interest rates existing in indebtedness between the Company and each
of Longview Fund L.P. and Alpha Capital Anstalt, in the amounts of $117,215 and
$30,031, respectively.  The reductions in interest due are reflected
in the above stated interest numbers.





All of
the notes have been extended to March 31, 2011.





OTHER
CONVERTIBLE PROMISSORY NOTES





On or
about September 4, 2008, the Company borrowed $400,000 from three
individuals.  The Notes have a term of 18 months from the date of
issuance and bear interest at the rate of $12% per annum.  Interest is
due and payable quarterly in arrears during the term of the Notes and principal
and accrued and unpaid interest are due in full at maturity.  Warrants
to purchase 250,000 shares of the Company’s common stock were issued in
connection therewith.  The warrants have an exercise price of $.10 per
share and a term of five years from the date of issuance.





Based
upon the relative fair values of the convertible debt and warrants none of the
proceeds of $400,000 has been allocated as additional paid in capital to the
warrants.




F-15





NOTE 5 -
STOCKHOLDERS’ (DEFICIT) EQUITY





During
the year ended December 31, 2008, the Company issued shares of common stock as
follows:





Valued
      at*200,000
              
              shares
      were issued to a consultant as compensation
              
              $
              60,00030,000
              
              shares
      were issued to Bob Sandelman, a former Board Member for director’s
      fees
              
              
              11,70080,000
              
              shares
      were issued to settle a prior agreement for services
              
              
              24,000310,000
              
              Charged
      to selling, general and administration expenses during the year ended
      December 31, 2008
              
              
              95,700221,389
              
              shares
      of common stock were issued in settlement of prior year accrued interest
      liability due on a secured convertible promissory note due to
      Longview
              
              
              77,826531,389
              
              Total
              
              $
              173,526




During
the year ended December31, 2009, the Company issued shares of common stock as
follows:





Valued
      at100,000
      shares were issued to a consultant as compensation
              
              $
              3,000
  *
Based upon the publicly traded share price of the Company’s common
stock on the date of issuance.




NOTE 6 –
SHORT-TERM NOTES PAYABLE





Short-term
notes payable consist of the following at December 31, 2009:


A
      convertible note payable to three individuals which bear interest at 12%
      per annum
              
              $
              400,000A
      demand note payable to Lou Persico, Chairman and CEO of Datascension which
      bear interest at 8% per annum
              
              
              100,000Total
      short-term notes payable at December 31, 2009
              
              $
              500,000




Short-term notes payable consist of the
following at December 31, 2008:


A
      note payable to Wells Fargo Bank which bears interest at 12.75% which was
      repaid 2009
            
            $
            17,464




F-16




NOTE
7. INCOME TAXES




As of
December 31, 2009, the components of deferred income taxes are as
follows:




Net
      operating loss carry forward
            
            $
            7,158,531Total
      deferred tax assets
            
            
            7,158,531Less
      valuation allowance
            
            
            (7,158,531
            )Net
      deferred tax assets
            
            $
            -




Reconciliation
of the differences between the statutory tax rate and the effective tax rate
is:




December
      31,
              2009
            
            
            December 31,
              2008Federal
      statutory tax rate
            
            
            34.0
            %
            
            
            34.0
            %Effective
      Tax Rate
            
            
            34.0
            %
            
            
            34.0
            %Valuation
      Allowance
            
            
            (34.0
            %)
            
            
            (34.0
            )%Net
      Effective Tax Rate
            
            
            
            
            
            
            —




As of
December 31, 2009, the Company has a net operating loss carry forward of
$21,054,504 expiring through 2029. The Company has provided a valuation
allowance against the full amount of the deferred tax asset due to management’s
uncertainty about its realization. Furthermore, the net operating loss carry
forward may be subject to further limitation pursuant to Section 382 of the
Internal Revenue Code.




NOTE 8 -
COMMITMENTS AND CONTINGENCIES





Leases





The
Company is committed under several non-cancelable lease agreements for office
space with various expiration dates through 2013.





At
December 31, 2009, aggregate future minimum payments under these leases, are as
follows:





For
      the period ended December 31,2010
            
            $
            432,1872011
            
            
            391,5472012
            
            
            367,5002013
            
            
            131,075Total
            
            $
            1,322,309




Rent
expense was $465,994 and $738,227 for the years ended December 31, 2009 and
2008.





F-17





NOTE 9 -
RELATED PARTY TRANSACTIONS





Series
B Preferred Stock





Preferred
stock, $.001 par value, 20,000,000 shares authorized, 505,900 of preferred stock
Series B issued and outstanding as of December 31, 2008.





The
Series B preferred shares pursuant to the certificate of designation were to be
converted two years after issuance.  The company reached agreement
with holders of Series B preferred shares that it was able to contact and
received these shares back.  The company has no record and was unable
to locate of the remaining holders of the Series B preferred shares and
therefore the board has taken the position that the value of the remaining
shares and paid-in capital be adjusted to zero.





Series
C Preferred Stock





On July
25, 2008, the Company filed a Certificate of Designation with the Secretary of
State of the State of Nevada authorizing a series of preferred stock, under its
articles of incorporation, known as “Series C Preferred Stock”. This Certificate
of Designation was approved by the Registrant’s Board of Directors. The
Certificate of Designation sets forth the following terms for the Series C
Preferred Stock:





Authorized
      Shares:
            
            1,000Per
      Share Stated Value:
            
            $4,500Liquidation
      Preference:
            
            Per
      share Stated ValueConversion
      Price into Common Stock:
            
            $.30
      per share, as adjusted from time to time as set forth in the Certificate
      of DesignationVoting
      Rights:
            
            The
      Series C Preferred Shares shall vote along with the Common Stock on an as
      converted basis and shall have two votes per
  share




On July
25, 2008, the Company entered into an agreement with Longview Fund, pursuant to
which the Longview Fund exchanged 15,000,000 shares of its Common Stock for
receipt of 1,000 shares of its Series C Preferred Stock.





Since the
fair value of the convertible Preferred Stock received in exchange for the
15,000,000 shares of its Common Stock would be immediately exchangeable into
common stock with a trading price lower than the conversion price, the Company
does not have a beneficial conversion feature to recognize by way of charge to
the Statement of Operation for the year ended December 31, 2009.





Extension
of Maturity Dates of Certain Notes





On or
about August 12, 2008, Longview Fund, L.P. extended the maturity date of its
promissory notes due from the Company and issued in June 2006 and December 2006
to January 15, 2010, and Alpha Capital Anstalt extended the maturity date of its
promissory notes due from the Company and issued in November 2004, June 2006 and
December 2006 to January 15, 2010. A further discussion of these notes is set
forth in Note 4 above.





Longview
Fund





As of
December31, 2009, Longview Fund, L.P. owned 14.6% of the issued and outstanding
common stock of the Company. Due to this stock ownership, the Company is
controlled by Longview Fund, L.P. and is deemed a “controlled corporation”. As
of July 30, 2008, due to the exchange of 15,000,000 shares of the Company’s
Common Stock, into shares of Series C Preferred Stock, which holds two votes per
share when voting alongside the Common Stock of the Company, Longview Fund
controls 64.5% voting control of the Company. See this footnote supra for a
further description of the Series C Preferred Stock.




F-18





Longview
Fund, L.P. may take actions that conflict with the interests of other
shareholders. Due to the 64.4% ownership of voting control, Longview Fund, L.P.
has substantial control over the Company and has substantial power to elect
directors and to generally approve all actions requiring the approval of the
holders of the Company’s voting stock. See Note 4 above for a discussion of
certain promissory notes due by the Company to Longview Fund, L.P.





Other
Related Parties





During
the year ended December 31, 2009, the Company billed $ 1,273,522 to Sandelman
& Associates, a Company controlled by a former board member, which amounted
to approximately 8.6% of total revenue for the period. At December 31,
2009.





On
December 31, 2008, Scott Kincer resigned as the CEO, President and a Director of
the issuer to pursue other opportunities.  Pursuant to a Separation
Agreement between the parties which is effective as of December 31, 2008, the
issuer is paying Mr. Kincer the sum of $64,750 over a period of five and one
half months as well as reimbursing him for accrued and unpaid expenses. The
agreement contains other standard terms and provisions as to releases and the
like. Selling, general and administrative expenses for the year ended December
31, 2008 includes provision for the amount due under this
agreement.  As of December 31, 2009, there is nothing outstanding
under this Agreement.





During
the year ended December 31, 2008, the Company incurred $5,000 in a director’s
fee and $62,500 in consulting fees to Lou Persico who became the CEO and
Chairman of the Company effective December 31, 2008. These amounts are including
with in selling, general and administrative expenses for the year ended December
31, 2008.





On
December 23, 2009, Joseph Harmon resigned as the COO, Director and Secretary of
the Company to pursue other opportunities.





There are
no other related party transactions, other than that stated above and in Notes 4
and 7.





NOTE 10 -
WARRANTS AND OPTIONS





The
Company has adopted FASB No. 123R and will account for stock issued for services
and stock options under the fair value method.





There
were no other options granted or exercised by the directors and executive
officers outstanding as of December 31, 2008.





The
following is a schedule of the activity relating to the Company’s stock options
and warrants.




Year Ended
            
            Year EndedDecember 31, 2009
            
            December 31, 2008Weighted Avg.
            
            Weighted Avg.Shares Exercise
            
            Shares Exercise(x 1,000)
            
            Price
            
            (x 1,000)
            
            PriceOptions
      and warrants outstanding at beginning of year
            
            
            2,901
            
            
            0.36
            
            
            2,851
            
            $
            0.36Granted:Options
            
            
            
            
            
            
            
            
            50
            
            
            0.30Warrants
            
            
            
            
            
            
            
            
            
            
            
            .ExercisedExpired:Warrants
            
            
            
            
            
            
            
            
            (
            )Options
      and warrants outstanding and exercisable at end of period
            
            
            2,901
            
            
            0.36
            
            
            2,901
            
            $
            0.36Weighted
      average fair value of options and warrants granted during the
      year
            
            
            
            
            $
            -
            
            
            
            
            $
            -




F-19




The
following table summarizes information about the Company’s stock options and
warrants outstanding at December 31, 2009, all of which are
exercisable:





Outstanding
              
              
              ExercisableNumber
      of shares
              
              
              OutstandingWeighted average remaining
      contractuallife
    (years)
              
              
              Weighted
                Averageexercise
      price
              
              
              VestedNumber ofShares
              
              
              Exercise
      Prices$0.00-$0.40
              
              
              
              2,900,987
              
              
              
              2.15
              
              
              $
              0.36
              
              
              
              2,900,987
              
              
              $
              0.36





NOTE 11 -
FOREIGN OPERATIONS





The
Company has its principal operating facilities located in  Costa Rica,
SA.  The Company currently coordinates all foreign operations, and
supervision activities using part time employees, consultants and contract
labor. Approximately 99% of the Company’s workforce is outside of the United
States. Currently 80% of the company’s clients are US based companies. Any
resulting foreign exchange fluctuations do not affect the payment of employees,
contract labor or off shore operations.




NOTE 12 -
CREDIT AGREEMENT





Wells
Fargo





On
November 7, 2008, the Company entered into an Account Purchase Agreement
(“Agreement”) with Wells Fargo Bank, National Association (“Wells Fargo”)
pursuant to which Wells Fargo agreed to purchase certain accounts receivable
from the Company from time to time, up to $4.5 million, at a price equal to the
face value of each such receivable less a discount equal to .5% plus the then
existing prime rate, plus three percent plus other fees and charges. Any
accounts sold to Wells Fargo for which payment is not received within the
proscribed time periods in the Agreement shall be subject to repurchase by the
Company. To secure this repurchase and other obligations of the Company there
under, the Company granted a first lien on all of its assets to Wells Fargo. In
connection therewith, the Longview Fund and Alpha Capital Anstalt agreed to
subordinate their security interests in the Company’s collateral to the security
interests of Wells Fargo.




NOTE 13 –
LOSS ON WRITE-OFF AND WRITEDOWN OF IMPAIRED ASSETS





Provisions
for impairment of intangibles and long-lived assets totaling of $4,302,633 had
been made by the Company during the year ended December 31, 2008, as
follows:





Loss
      on write-off of goodwill
            
            $
            1,692,782Loss
      on write-off of property and equipment
            
            
            2,606,644Loss
      on write-off of website assets
            
            
            3,207Total
            
            $
            4,302,633




NOTE 14 -
SUBSEQUENT EVENTS





On March 4, 2010, Stanley Hirschman resigned
as a Director of Datascension, Inc.




F-20





ITEM 7. CHANGES IN AND DISAGREEMENTS WITH
ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.





None





ITEM 7A(T). CONTROLS AND PROCEDURES.





Evaluation
of Disclosure Controls and Procedures




As of the
end of the period covered by this Annual Report on Form 10-K, management
performed, with the participation of our Chief Executive Officer and Chief
Accounting Officer, an evaluation of the effectiveness of our disclosure
controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the
Exchange Act. Our disclosure controls and procedures are designed to ensure that
information required to be disclosed in the report we file or submit under the
Exchange Act is recorded, processed, summarized, and reported within the time
periods specified in the SEC’s forms, and that such information is accumulated
and communicated to our management including our Chief Executive Officer and our
Chief Accounting Officer, to allow timely decisions regarding required
disclosures. Our Chief Executive Officer and our Chief Accounting Officer
concluded that, as of December 31, 2009, our disclosure controls and
procedures were effective.





Management’s
Annual Report on Internal Control Over Financial Reporting.




Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting for the company in accordance with as defined
in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control
over financial reporting is designed to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted
accounting principles. Our internal control over financial reporting includes
those policies and procedures that:





(i)
pertain to the maintenance of records that, in reasonable detail, accurately and
fairly reflect the transactions and dispositions of our assets;





(ii)
provide reasonable assurance that transactions are recorded as necessary to
permit preparation of financial statements; and





(iii)
provide reasonable assurance regarding prevention or timely detection of
unauthorized transactions.




21





Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.





Management’s
assessment of the effectiveness of the small business issuer’s internal control
over financial reporting is as of the year ended December 31, 2008. In making
this assessment, our management used the criteria set forth by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control - Integrated
Frameworkand Internal
Control over Financial Reporting-Guidance for Smaller Public Companies.We believe that internal control over financial reporting is effective.
We have not identified any, current material weaknesses considering the nature
and extent of our current operations and any risks or errors in financial
reporting under current operations.





This
annual report does not include an attestation report of the company’s registered
public accounting firm regarding internal control over financial reporting.
Management’s report was not subject to attestation by the Company’s registered
public accounting firm pursuant to temporary rules of the SEC that permit the
Company to provide only management’s report in this annual report.





There was
no change in our internal control over financial reporting that occurred during
the fiscal quarter ended December 31, 2009, that has materially affected, or is
reasonably likely to materially affect, our internal control over financial
reporting.




There
have been no changes during the quarter ended December 31, 2009 in our Company’s
internal control over financial reporting identified in connection with the
evaluation required by Exchange Act Rules 13a-15(d) and 15d-15(d) that have
material affected, or are reasonably likely to materially affect, our internal
controls over our financial reporting.




ITEM 7B. OTHER INFORMATION.





None.




PART III





ITEM 8. DIRECTORS, EXECUTIVE OFFICERS AND
CORPORATE GOVERNANCE.





Directors
and Executive Officers





The
following table sets forth information regarding our executive officers, certain
other officers and directors as of December 31, 2009:




Name
            
            Age
            
            Position/Office
            
            Served
      SinceStanley
      Hirschman
            
            63
            
            Director
            
            August
      2008David
      Lieberman
            
            65
            
            Director
      /CFO
            
            May
      2006Lou
      Persico
            
            54
            
            Chairman/President/CEO
            
            December
      2008





22




The
following is a brief description of the business background of the directors and
executive officers of the Company:





Stanley
Hirschman - Director





Stanley
Hirschman is President of CPointe Associates, Inc., a Plano, Texas executive
management and retail operations consulting firm. He is an investment due
diligence specialist and works regularly with public companies dealing with the
difficulties of the balance between increased regulatory requirements and
reasonable corporate governance. He is a director of Axion Power International
and South Texas Oil and former chairman of Mustang Software, Inc. While at
Mustang Software, Mr. Hirschman took a hands-on role in the planning and
execution of the strategic initiative to increase shareholder value resulting in
the successful acquisition of the company by Quintus Corporation.





His
client list has included GameStop, Nortel, SBC Wireless (now AT&T), Dalrada
Financial Corp., Oxford Media Corporation, Earthlink, Inc., Aiirmesh
Communications, Bravo Foods International and Retail Highway. Prior to
establishing CPointe Associates, he was Vice President Operations, Software
Etc., Inc., a 396 retail store software chain, from 1989 to 1996. He also has
held senior executive management positions with T.J. Maxx, Gap Stores and Banana
Republic.




Mr.
Hirschman is a member of the National Association of Corporate Directors and the
KPMG Audit Committee Institute and is a graduate of the Harvard Business School
Audit Committees in the New Era of Governance symposium. He is active in
community affairs and serves on the Advisory Board of the Salvation Army Adult
Rehabilitation Centers.





David P.
Lieberman – CFO and Director





Mr.
Lieberman’s experience includes serving in various Senior Executive positions
with a strong financial and operations background. Currently Mr. Lieberman is on
the Board of Directors of South Texas Oil Company, an over the counter public
company. Mr. Lieberman has been the Chief Financial Officer for John Goyak &
Associates, Inc., an aerospace consulting firm located in Las Vegas, NV since
2003. Lieberman previously served as President and Chief Operating Officer of
both JLS Services, Inc., since 1996, and International Purity, since 1997. From
1994 through 1996 Mr. Lieberman served as Chief Financial Officer and Chief
Operating officer for California Athletic Clubs, Inc. Mr. Lieberman has over
forty years of financial experience beginning with five years as an accountant
with Price Waterhouse from 1967 through 1972. Mr. Lieberman attended the
University of Cincinnati, where he received his B.A. in Business. Mr. Lieberman
is also a licensed CPA in the state of California.





Lou
Perisco – Chairman and Chief Executive Officer and President (effective December
31, 2008)




Lou
Persico has been Datascension’s chief executive officer and chairman of the
company’s Board of Directors since December 2008. Prior to that from July to
December 2008, Persico joined Datascension as a member of the board of
directors. He has over two decades of financial and operational experience in
private and public corporations.




Before
joining Datascension he worked for a series of “Fortune 100 Companies.”
Persico’s focus later on in his career has been with venture-backed companies as
CFO. Earlier on, Persico served in a variety of international executive
capacities with American Cyanamid/Wyeth Pharmaceuticals where he held the roles
of controller and finance director for almost 10 years operating on location in
Madrid, Spain; San Juan, Puerto Rico; and Rio de Janeiro, Brazil. After American
Cyanamid, he worked for the Perkin-Elmer Co., Pearle Vision, Technicolor, Sara
Lee, Cambridge Technology Partners, and Arthur D. Little as CFO.




Persico
earned at Pace University, New York City, a combined BBA/MBA. He graduated from
the Executive Programs at the Harvard Business School and Columbia Business
School. He is multilingual -- Spanish and Portuguese.




Significant
Employees





The
Company has not identified any employee who is not an executive who is expected
to make a significant contribution to the business.




23





Family
Relationships





There are
no family relationships among the directors, executive officers or persons
nominated or chosen by the Company to become directors or executive
officers.





Legal
Proceedings





None of
the Company’s directors, executive officers or nominees for such office have
been involved in any legal proceedings related to bankruptcy of an entity where
they held such positions; nor charged or convicted in any criminal proceedings;
nor subject to any order, judgment, or decree permanently or temporarily
enjoining, barring, suspending or otherwise limiting their involvement in any
type of business, securities or banking activities; nor found in any manner
whatsoever to have violated a federal or state securities or commodities
law.




None of
the Company’s officers or directors, nor to the knowledge of the Company, any of
the Company’s control persons, has:





·
            had
      any bankruptcy petition filed by or against any business of which such
      person was a general partner or executive officer either at the time of
      the bankruptcy or within two years prior to that
  time;





·
            been
      convicted in a criminal proceeding or is subject to a pending criminal
      proceeding (excluding traffic violations and other minor
      offenses);





·
            been
      subject to any order, judgment, or decree, not subsequently reversed,
      suspended or vacated, of any court of competent jurisdiction, permanently
      or temporarily enjoining, barring, suspending or otherwise limiting his
      involvement in any type of business, securities or banking activities;
      or





·
            been
      found by a court of competent jurisdiction (in a civil action), the
      Securities and Exchange Commission or the Commodity Futures Trading
      Commission to have violated a federal or state securities or commodities
      law, where the judgment has not been reversed, suspended or
      vacated.





Committees





The
Company does not have any audit, compensation, and executive committees of its
board of directors. The entire board of directors is serving as the Company’s
audit committee. The Company has not yet implemented any such committees due to
limited financial and personnel resources; however, it is exploring the set up
and functions of committees and is seriously considering implementation during
2010.





Conflicts
of Interest





The
officers and directors of the Company are now and may in the future become
shareholders, officers or directors of other companies which may be engaged in
business activities similar to those conducted by the Company. Accordingly,
additional direct conflicts of interest may arise in the future with respect to
such individuals acting on behalf of the Company or other entities. Moreover,
additional conflicts of interest may arise with respect to opportunities which
come to the attention of such individuals in the performance of their duties or
otherwise. The Company does not currently have a right of first refusal
pertaining to opportunities that come to management’s attention insofar as such
opportunities may relate to the Company’s proposed business
operations.





The
officers and directors are, so long as they are officers or directors of the
Company, subject to the restriction that all opportunities contemplated by the
Company’s plan of operation which come to their attention, either in the
performance of their duties or in any other manner, will be considered
opportunities of, and be made available to the Company and the companies that
they are affiliated with on an equal basis. A breach of this requirement will be
a breach of the fiduciary duties of the officer or director. If the Company or
the companies in which the officers and directors are affiliated with both
desire to take advantage of an opportunity, then said officers and directors
would abstain from negotiating and voting upon the opportunity. However, all
directors may still individually take advantage of opportunities if the Company
should decline to do so. Except as set forth above, the Company has not adopted
any other conflict of interest policy with respect to such
transactions.




24




Compliance
with Section 16(a) of the Exchange Act





Section
16(a) of the Securities Exchange Act of 1934 requires our directors and
executive officers, and persons who beneficially own more than ten percent of a
registered class of our equity securities (referred to as “reporting persons”),
to file with the Securities and Exchange Commission initial reports of ownership
and reports of changes in ownership of common stock. Reporting persons are
required by Commission regulations to furnish us with copies of all


Section
16(a) forms they file.





We are
not aware of any person who at any time during the fiscal year ended December
31, 2008, was a director, officer, or beneficial owner of more than ten percent
of our common stock, who failed to file reports required by Section 16(a) of the
Securities Exchange Act of 1934 during such fiscal year, which have not been
accurately updated, even if not on a timely basis.





Code of
Ethics





We have
adopted a code of ethics that applies to our executive officers, including our
Chief Executive Officer and Chief Financial Officer.





Indemnification
of Directors and Officers.





The
By-laws of the Company state that to the extent allowed by Nevada State law, as
same may be amended, and subject to the required procedure thereof, the
corporation shall indemnify any person who was or is a party of is threatened to
be made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative (other than
an action by or in the right of the corporation) by reason of the fact that he
is or was a director, officer, employee or agent of the corporation, or is or
was serving at the request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys’ fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by him in connection
with such action, suit or proceeding if he acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best interests of the
corporation, and with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement or conviction, or upon
a plea of nolo contender or its equivalent, shall not of itself, create a
presumption that the person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of the
corporation, and with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful.





ITEM 9.
EXECUTIVE COMPENSATION.





Compensation
of Executive Officers





The
following table sets forth the aggregate cash compensation paid by the Company
for services rendered during the periods indicated to its directors and
executive officers. The compensation disclosed in the compensation table is
inclusive of any and all compensation paid through the Company.




25




SUMMARY
COMPENSATION TABLE





LONG TERM
              COMPENSATIONANNUAL COMPENSATION
            
            AWARDS
PAYOUTS




NAME
      AND PRINCIPALPOSITION
            
            YEAR
            
            SALARY
            
            BONUS &
      COMMISSIONS
            
            HOUSING
      ALLOWANCE
            
            ALL OTHER
      COMPENSATION
            
            TOTALLou
      Persico - CEO
            
            (4)
            2009
            
            $
            229,494
            
            
            
            
            
            
            
            
            
            
            $
            229,494Lou
      Persico - CEO
            
            
            2008
            
            
            
            
            
            
            
            
            
            
            
            62,500
            1
            
            62,500David
      Lieberman – CFO
            
            
            2009
            
            $
            210,519
            
            
            
            
            
            
            
            
            
            
            
            210,519David
      Lieberman -
            
            
            2008
            
            $
            173,077
            
            
            
            
            
            
            
            
            
            
            
            173,077Joseph
      Harmon – COO
            
            
            2009
            
            $
            200,051
            
            
            
            
            
            20,000
            
            $
            
            
            
            220,051Joseph
      Harmon - COO
            
            
            2008
            
            $
            175,000
            
            
            60,275
            (3)
            
            30,000
            
            $
            11,073
            
            $
            276,348







(1)
            Professional
      fees.




Employment
Agreements





The Company has no employment
agreements.





DIRECTOR COMPENSATION TABLE





Name
            
            Fees
              Earned
              or
              Paid
      in
              Cash
            
            
            Stock
              Awards
            
            Option
              Awards(1)
            
            Non-Equity
              Incentive
      Plan
              Compensation
            
            
            Nonqualified
              Deferred
              Compensation
              Earnings
            
            
            All
      Other
              Compensation
            
            
            TotalJoseph
      Harmon
            
            
            -Stanley
      Hirschman
            
            $
            24,000
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            24,000David
      Lieberman
            
            
            -
            
            
            $
            -
            
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            $Lou
      Persico
            
            $
            -
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            -




OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END FOR
2





Option Awards
            
            Stock AwardsName and PrincipalPosition
            
            Number of
              Securities
              Underlying
              Unexercised
              Options (#)
              Exercisable
            
            Number of
              Securities
              Underlying
              Unexercised
              Options (#)
              Unexercisable
            
            Number of
              Securities
              Underlying
              Unexercised
              Unearned
              Options (# )
            
            Option
              Exercise
              Price
            
            Option
              Expiration
              Date
            
            Number
              of
              Shares
              or
      Units
              of
              Stock
              That
              Have
              Not
              Vested
            
            Market
              Value
              of
              Shares
              or
              Units
              of
              Stock
              That
              Have
              Not
              Vested
            
            Number
              of
              Unearned
              Shares
      or
              Other
              Rights
              That
              Have
      Not
              Vested
            
            Market
              Value
      or
              Payout
              Value
      of
              Unearned
              Shares,
              Units
      or
              Other
              Rights
              That
              Have
      Not
              VestedLou
      Persico CEOJoseph
      Harmon COO
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            435,000
            
            
            -
            
            
            -
            
            
            -David
      Lieberman CFO
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            100,000




26





ITEM 10. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS





Security
Ownership of Management and Certain Beneficial Owners





The
following table sets forth information as of the date of this Form 10-K certain
information with respect to the beneficial ownership of the Common Stock of the
Company concerning stock ownership by (i) each director, (ii) each executive
officer, (iii) the directors and officers of the Company as a group, (iv) and
each person known by the Company to own beneficially more than five (5%) of the
Common Stock. Unless otherwise indicated, the owners have sole voting and
investment power with respect to their respective shares.





Beneficial
ownership is determined under the rules of the Securities and Exchange
Commission. In general, these rules attribute beneficial ownership of securities
to persons who possess sole or shared voting power and/or investment power with
respect to those securities and include, among other things, securities that an
individual has the right to acquire within 60 days. Unless otherwise indicated,
the stockholders identified in the following table have sole voting and
investment power with respect to all shares shown as beneficially owned by
them.





Class
            
            Name
      and Address of BeneficialOwner
      (1)
            
            Number
      of
              Shares
            
            Percent
              Owned(2)Common
            
            
            Joseph
      Harmon
            
            
            400,556
            
            
            1.87
            %Warrants
            
            
            Joseph
      Harmon
            
            
            435,000
            
            
            2.03
            %Common
            
            
            Stanley
      Hirschman
            
            
            
            
            
            
            %Warrants
            
            
            Stanley
      Hirschman
            
            
            
            
            
            
            %Common
            
            
            Lou
      Persico
            
            
            
            
            
            
            %Warrants
            
            
            Lou
      Persico
            
            
            
            
            
            
            %Common
            
            
            David
      Lieberman
            
            
            30,000
            
            
            .14
            %Warrants
            
            
            David
      Lieberman
            
            
            100,000
            
            
            .47
            %Common & Warrants
            
            
            Officers
      and Directors as a group
            
            
            965,556
            
            
            4.51
            %Common
            
            
            Longview
      Fund, LP (3)
            
            
            3,125,488
            
            
            14.60
            %Warrants
            
            
            Longview
      Fund, LP (3)
            
            
            
            
            
            
            %Common
            
            
            Alpha
      Capital Anstalt (4)
            
            
            1,054,615
            
            
            4.93
            %Warrants
            
            
            Alpha
      Capital Anstalt (4)
            
            
            2,215,987
            
            
            10.35
            %







(1)
Unless otherwise cited, address is care of the Company’s principal
address.





(2) The
percentage ownership calculations listed above are based upon 21,407,261 shares
of common stock being outstanding and common stock issuable upon exercise of
warrants which are exercisable within 60 days, as of April 15,
2010.





(3) The
address of Longview Fund, L.P. is c/o Viking Asset Management, LLC, 505 Sansome
Street, Suite 1275, San Francisco, CA 94111.





(4) The
address of Alpha Capital Anstalt is Pradafant 7, Furstatums 9490, Vadus,
Lichtenstein. Warrants held by Alpha Capital are subject to a blocker that would
prevent Alpha Capital’s and its affiliates’ aggregate ownership at any given
time from exceeding 9.99% of our outstanding common stock.




27





Persons
Sharing Ownership of Control of Shares





Management
has no knowledge of the existence of any arrangements or pledges of the
Company’s securities which may result in a change in control of the
Company.





No person
shares the power to vote ten percent (10%) or more of the Company’s
securities.





ITEM 11. CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS AND DIRECTOR INDEPENDENCE





In June
2006, the Company issued two secured convertible promissory notes. One note is
due to Long View Fund L.P.  (“Longview”) and had a principal amount of
$1,702,859 and the other note due to Alpha Capital Anstalt (“Alpha”) had a
principal amount of $571,429. As part of the financing transaction, the Company
issued warrants to purchase 4,865,311 shares of common stock at a per share
purchase price of $0.40 per share.





The
$1,702,859 promissory note due Longview accrues interest at a rate of 6% per
annum. Interest is to be paid quarterly.  The note was due and payable
in June 2008. It was entered into pursuant to the terms of a subscription
agreement between the Company and the Holder.  The $1,702,859 in
proceeds from the financing transaction were allocated to the debt features and
to the warrants based upon their fair values. After the latter allocations,
there was $318,796 of remaining value to be allocated to the long-term debt in
the financial statements. The debt discount was being accreted using the
effective interest method over the term of the note.





In
December, 2007, accrued interest of $25,753 was added to the note due to
Longview increasing the principal amount of the note to $1,728,612. The $571,429
promissory note due to Alpha accrued interest at a rate of 6% per annum. The
interest rate on this note has increased to the 10% default rate.





Longview,
as the note holder, has extended the due date of the remainder due on the note
to March 31, 2011.





As of
December 31, 2008, both notes are unpaid and there is $319,563 of accrued
interest.





In
December 2006, the Company issued $2,065,458 in principal amount in a secured
promissory note to Longview. As part of the financing transaction, 1,280,000
warrants were issued to the note holder of the December 2006 notes with a 5 year
term and a $0.45 exercise price. In 2007, the note holder converted some debt
and interest into shares of stock along with the exercise of the warrants which
were attached to the note.





The note
due Longview described in the preceding paragraph accrues interest at a rate 14%
per annum. The note was due and payable in December 2008.  This note
is not convertible into common stock of the Company. Upon issuance, the Company
allocated $1,867,328 to the debt and $198,130 to the warrants based on the
relative fair values of each. The value of the warrants was determined using 56%
volatility, five year terms, and a $0.45 exercise price. The debt discount of
$198,130 was amortized over the two year term of the note.





In
December 2007 accrued interest of $40,685 was added to the note due to Longview
increasing the amount of the note at December 31, 2007 to $1,193,643. The note
is unpaid and there is $ 215,444 of accrued interest outstanding at December 31,
2008.





Longview,
as the note holder, has extended the due date of the remainder due on the note
to January 15, 2010.  In September, 2009, Longview agreed to extend
the note to March 31, 2011.




28





In
December, 2007, the Company issued a secured promissory note to Alpha Capital
Anstalt in the amount of $103,665 at an interest rate of 14% per annum. This
note was for interest and penalties that had accrued previously.  The
interest rate on this note has increased to the 18% default rate. At December
31, 2008, this note is unpaid and there is $38,342 of accrued
interest.





Below is
a summary of secured convertible promissory notes payable due to Longview and
Alpha and related accrued interest payable at December 31, 2009




LongviewNotes
              
              $
              3,205,260Accrued
      interest payable
              
              
              0$
              3,205,260AlphaNotes
              
              $
              1,039,870Accrued
      interest payable
              
              
              0$
              1,039,870


Interest
expenses incurred during the year ended December 31, 2008 on the above tabled
debt due to Longview and Alpha is as follows:




Longview
              
              $
              202,566Alpha
              
              
              48,277$
              250,843





Series
C Preferred Stock





On July
25, 2008, the Company filed a Certificate of Designation with the Secretary of
State of the State of Nevada authorizing a series of preferred stock, under its
articles of incorporation, known as “Series C Preferred Stock”. This Certificate
of Designation was approved by the Registrant’s Board of Directors. The
Certificate of Designation sets forth the following terms for the Series C
Preferred Stock:





Authorized
      Shares:
            1,000Per
      Share Stated Value:
            $4,500Liquidation
      Preference:
            Per
      share Stated ValueConversion
      Price into Common Stock:
            $.30
      per share, as adjusted from time to time as set forth in the Certificate
      of DesignationVoting
      Rights:
            The
      Series C Preferred Shares shall vote along with the Common Stock on an as
      converted basis and shall have two votes per
  share




On July
25, 2008, the Company entered into an agreement with Longview Fund, pursuant to
which the Longview Fund exchanged 15,000,000 shares of its Common Stock for
receipt of 1,000 shares of its Series C Preferred Stock.





Extension
of Maturity Dates of Certain Notes





On or
about August 12, 2008, Longview Fund, L.P. extended the maturity date of its
promissory notes due from the Company and issued in June 2006 and December 2006
to March 31, 2011, and Alpha Capital Anstalt extended the maturity date of its
promissory notes due from the Company and issued in November 2004, June 2006 and
December 2006 to March 31, 2011.




29





Longview
Fund





As of
December 31, 2008, Longview Fund, L.P. owned 49.9% of the issued and outstanding
common stock of the Company. Due to this stock ownership, the Company is
controlled by Longview Fund, L.P. and is deemed a “controlled corporation”. As
of July 30, 2008, due to the exchange of 15,000,000 shares of the Company’s
Common Stock, into shares of Series C Preferred Stock, which holds two votes per
share when voting alongside the Common Stock of the Company, Longview Fund
controls 64.5% voting control of the Company. See this footnote supra for a
further description of the Series C Preferred Stock.





Longview
Fund, L.P. may take actions that conflict with the interests of other
shareholders. Due to the 64.4% ownership of voting control, Longview Fund, L.P.
has substantial control over the Company and has substantial power to elect
directors and to generally approve all actions requiring the approval of the
holders of the Company’s voting stock. See Note 6 above for a discussion of
certain promissory notes due by the Company to Longview Fund,
L.P.





During
the twelve months ended December 31, 2009, the Company billed approximately $
1,273,522 to Sandelman & Associates, a company controlled by a former board
member, which amounted to 8.6% of total revenue for the period.





On
December 31, 2008, Scott Kincer resigned as the CEO, President and a Director of
the issuer to pursue other opportunities.  Pursuant to a Separation
Agreement between the parties which is effective as of December 31, 2008, the
issuer is paying Mr. Kincer the sum of $64,750 over a period of five and one
half months as well as reimbursing him for accrued and unpaid expenses. The
agreement contains other standard terms and provisions as to releases and the
like.  At December 31, 2009 there were no payments due to Mr.
Kincer.





ITEM 12.
PRINCIPAL ACCOUNTING FEES AND SERVICES





Audit
Fees





For the
fiscal year ended December 31, 2009, the Company’s principal accountant, KBL,
LLP, billed $43,000 for the audit of the Company’s annual financial statements
and review of financial statements included in the Company’s Form 10-Q
filings.





For the
fiscal year ended December 31, 2008, the Company’s principal accountant, KBL,
LLP billed $35,000, for the audit of the Company’s annual financial statements
and review of financial statements included in the Company’s Form 10-Q
filings.





Audit-Related
Fees





For the
fiscal years ended December 31, 2009 and 2008, the Company’s principal
accountant billed $0 and $0, respectively, for assurance and related services
that were reasonably related to the performance of the audit or review of the
Company’s financial statements outside of those fees disclosed above under
“Audit Fees”.




30





Tax
Fees





For the
fiscal years ended December 31, 2009 and 2008, the Company’s principal
accountant billed $0 and $0, respectively, for tax compliance, tax advice, and
tax planning services.





All Other
Fees





For the
fiscal years ended December 31, 2009 and 2008, the Company’s principal
accountant billed $0and $0, respectively, for products and services other than
those described above.





Pre-approval
Policies and Procedures





Prior to
engaging the Company’s accountants to perform a particular service, the
Company’s board of directors obtains an estimate for the service to be
performed. The board of directors, in accordance with procedures for the
Company, approved all of the services described above prior to the services
being performed.





PART
IV





ITEM 13.
EXHIBITS, FINANCIAL STATEMENT SCHEDULES




(a)
EXHIBITS.





The
following documents are included or incorporated by reference as exhibits to
this report:





(2) a)
Plan of Acquisition, Reorganization, Arrangement, Liquidation, or
Succession.





2.1 Plan
and Articles of Merger, filed 8/23/91(1)




2.2 Plan
of Reorganization and Agreement, dated 9/20/97(1)





(3)
Articles of Incorporation & By-Laws





3.1
Articles of Incorporation of the Company Filed August 23, 1991(1)




3.2
Articles of Amendment filed on April 10, 1992(1)




3.3
Certificate of Amendment of Articles of Incorporation filed on
3/3/95(1)





3.4
By-Laws of the Company adopted August 24, 1991(1)




3.5
Certificate of Amendment of Articles of Incorporation filed on
2/19/01




3.6
Articles of Incorporation - Nutek Oil, Inc. (Subsidiary)




3.7
Articles of Incorporation - Kristi and Co, Inc. (Subsidiary)




3.8
Articles of Incorporation - SRC International, Inc. (Subsidiary)




3.9
Articles of Incorporation - Century Innovations, Inc. (Subsidiary)




3.10
Articles of Incorporation - Datascension International, Inc.
(Subsidiary)




3.11
Certificate of Amendment of Articles of Incorporation filed on
1/26/04




31





(4)
Instruments Defining the Rights of Security Holders





4.1 Those
included in exhibit 3, and sample of Stock Certificate (1)




4.2
Preferred Stock (1)





5.1 Legal
Opinion *





(10)
Material Contracts





10.1
Purchase Agreement - Kristi and Co dated 1/6/00 (1)




10.2
Agreement for Promotion and Revenue Sharing Plan, dated 9/2/99 (1)




10.3
Purchase Agreement - Elite Fitness, dated 10/4/99 (1)




10.4
Purchase Agreement - Patent #5833350, dated 9/15/99 (1)




10.5
Purchase Agreement - Clock Mold, dated 4/30/99 (1)




10.6 Plan
of Purchase and Agreement, dated 11/30/97 (1)




10.7
Transitional Employer Agreement (1)




10.8
Lease, dated October 15, 1999 (1)




10.9
Letter of Intent - Mineral Acres, dated 11/1/99 (1)




10.10
Compensation Plan (1)




10.11 Key
Employees Incentive Stock Option Plan (1)




10.12
Purchase Agreement - Kristi & Company (2)




10.13
Blank




10.14
Purchase Agreement - Printing Equipment (3)




10.15
Blank




10.16
Employment Agreement Murray N. Conradie (4)




10.17
Employment Agreement Donald L. Hejmanowski (4)




10.18
Employment Agreement Kristi L. Conradie (4)




10.19
Purchase Agreement - Datascension Inc. (5)




10.20
Employment Agreement David Scott Kincer (5)




10.21
Certificate of Preference Rights.




10.22
Purchase Agreement - Sin Fronteras Inc




10.23
Press Release dated May 29, 2002




10.24
Subscription Agreement for November 17, 2004 Funding (6)




32




10.25
Form of Convertible Note - November 17, 2004 Funding (6)




10.26
Form of Warrant - November 17, 2004 Funding (6)




10.27
Subscription Agreement for March 31, 2005 issuance. (7)




10.28
Convertible Note - March 31, 2005. (7)




10.29
Warrant - March 31, 2005. (7)




10.30
Service Agreement - Harris Interactive, Inc. (8)




10.31
Service Agreement - Towne, Inc. (8)




10.32
Service Agreement - Sandelman & Associates (8)




10.33
Service Agreement - Knowledge Networks, Inc. (8)





10.34
Employment Agreement David Scott Kincer (9)*




10.35
Warrant Agreement David Scott Kincer (9)*




10.36
Employment Agreement Joseph Harman *




10.37
Warrant Agreement Joseph Harman (9)*




10.38
June 7, 2006 Subscription Agreement (10)




10.39
June 7, 2006 Note Issued to Longview Fund, L.P. (10)




10.40
June 7, 2006 Note Issued to Alpha Capital (10)




10.41
June 7, 2006 Warrant Issued to Longview Fund, L.P. (10)




10.42
June 7, 2006 Warrant Issued to Alpha Capital (10)




10.43
December 12, 2006 Subscription Agreement (11)




10.44
December 12, 2006 Form of Note (11)




10.45
December 12, 2006 Form of Warrant (11)




10.46.
Credit Agreement with Comerica Bank, dated as of August 30, 2007, and related
ancillary agreements







(1)
            Previously
      filed as an exhibit to the Company’s Form 10-SB, filed January 24,
      2000.




(2)
            Previously
      filed as an exhibit to the Company’s Number 1 Amendment to Form 10-SB,
      filed May 22, 2000.




(3)
            Previously
      filed as an exhibit to the company’s quarterly report for the period ended
      March 31, 2003




(4)
            Previously
      filed as an exhibit to the company’s quarterly report for the period ended
      June 30, 2003




33




(5)
            Previously
      filed as an exhibit to the company’s quarterly report for the period ended
      September 30, 2003




(6)
            Previously
      filed on Form 8-K November 23, 2004, File No.
  000-29087




(7)
            Previously
      filed as an exhibit to the Company’s Form SB2/A, filed April 27,
      2005




(8)
            Previously
      filed as an exhibit to the Company’s Form SB2/A, filed October 11,
      2005




(9)
            Previously
      filed as an exhibit to the Company’s Form SB-2 filed on June 30,
      2006




(10)
            Previously
      filed as an Exhibit 99 to the Company’s 8-K filed on June 15,
      2006




(11)
            Previously
      filed as an Exhibit 99 to the Company’s 8-K filed on December 18,
      2006





Exhibit
31. Certifications required by Rule 13a-14(a) or Rule 15d-14(a)





31.1 and
32.2 Certification of Chief Executive Officer and Principal Financial Officer
pursuant to 18 U.S.C.ss.1850 as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.




Exhibit
32. Certifications required by Rule 13a-14(b) or Rule 15d-14(b) and section 906
of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350.





32.1 and
32.2 Certification of Chief Executive Officer and Principal Financial Officer
pursuant to 18 U.S.C.ss.1850 as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.




34





SIGNATURES





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




Datascension
      , Inc.April
      15, 2010By:
            /s/
      Lou PersicoLou
      PersicoPresident
      and Chief Executive Officer




In
accordance with Section 13 or 15(d) of the Exchange Act, this report has been
signed below by the following persons on behalf of the registrant and in the
capacities and on the dates indicated.





Signature
            
            Title
            
            Date/s/
      LOU PERSICO
            
            President
      and Chief Executive Officer
            
            April
      15, 2010Lou
      Persico
            
            and
      Director(Principal
      Executive Officer)/s/
      DAVID P. LIEBERMAN
            
            Chief
      Financial Officer and Director
            
            April
      15, 2010David
      P. Lieberman
            
            (Principal
      Accounting Officer)





35