UNITED STATES

SECURITIES AND
EXCHANGE COMMISSION

Washington, D.C. 20549



FORM 10-QSB



[X] QUARTERLY REPORT
UNDER SECTION 13 OR 15(d)

OF THE SECURITIES
EXCHANGE ACT OF 1934



For the quarterly
period ended: September 30, 2004



[ ] TRANSITION REPORT
PURSUANT TO SECTION 13 OR

15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934



Commission file number
000-25415



Twin Faces East
Entertainment Corporation

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



|Nevada                                     | 94-3326901              
|------------------------------------------ | ------------------------
|(State or other jurisdiction
		of          | (I.R.S.
		Employer      
|incorporation or
		organization)           | Identification
		Number)
|                                          
|2857 Hartwick Pines Dr.                   
|Henderson, Nevada                          | 89052                   
|(Address of Principal
		Executive Offices) | (Zip
		Code)            



(702) 617-8832

(Issuer's telephone
number, including area code)



Check mark whether
the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of
the Securities Exchange Act of 1934 during the last 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.



Yes X     No ____



The number of shares
of Common Stock, $0.001 par value, outstanding on September 30, 2004, was
9,717,348 shares.



Transitional Small
Business Disclosure Format (check one):



Yes     No X



---



PART 1 - FINANCIAL
INFORMATION

Item 1. Financial Statements.



Twin Faces East
Entertainment Corporation

(a Development Stage
Company)

Balance Sheet



|                                                                                                              | September 30,
		2004 Unaudited)
|------------------------------------------------------------------------------------------------------------- | -------------------------------
|Assets                                                                                                        |                                
|                                                                                                              |                                
|Current assets:                                                                                               |                                
|Cash and equivalents                                                                                          | $             -                
|Total current assets                                                                                          | -                              
|                                                                                                              |                                
|Fixed assets, net                                                                                             |                                
|                                                                                                              |                                
|Other noncurrent assets                                                                                       | 230,000                        
|                                                                                                              | $ 230,000                      
|Liabilities and Stockholders'
		Equity                                                                        |                                
|                                                                                                              |                                
|Current liabilities:                                                                                          |                                
|Cash deficit                                                                                                  | $            10                
|Accrued salaries and benefits                                                                                 | 1,606,265                      
|Other accrued expenses                                                                                        | 1,638,318                      
|Stockholders' advances                                                                                        | 458,899                        
|Total current liabilities                                                                                     | 3,703,492                      
|                                                                                                              |                                
|Long-term debt                                                                                                | 485,900                        
|                                                                                                              |                                
|                                                                                                              | 4,189,392                      
|Stockholders' equity:                                                                                         |                                
|Preferred stock, $0.001 par
		value, authorized 5,000,000 shares, no shares issued and outstanding            | -                              
|                                                                                                              |                                
|Common stock, $0.001 par
		value, authorized 20,000,000 shares; 9,717,348 issued and outstanding at
		9/30/04 | 9,717                          
|                                                                                                              |                                
|Additional paid-in capital                                                                                    | 1,271,328                      
|(Deficit) accumulated during
		development stage                                                              | (5,270,462)                    
|Prior period adjustment                                                                                       | 30,025                         
|                                                                                                              | (3,959,392)                    
|                                                                                                              | $     230,000                  





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



2

---



Twin Faces East
Entertainment Corporation

(a Development Stage
Company)

Statements of
Operations

for the three months
and nine months ended September 30, 2004 and 2003

and for the period
December 5, 1997 (inception) to September 30, 2004



|                                                                                 | For the three
		months ended
		September 30, | For the nine
		months ended September 30, | December 5, 1997
		(inception) to September 30, 2004
|-------------------------------------------------------------------------------- | -------------------------------------------- | ----------------------------------------- | ----------------------------------------------------
|                                                                                 | 2004                                         | 2003                                      | 2004                                                
|Pre-Operating Revenue                                                            |                                              |                                           |                                                     
|Interest Income                                                                  | $                -                           | $             
		-                        | $               -                                   
|                                                                                 |                                              |                                           |                                                     
|Pre-Operating Expenses:                                                          |                                              |                                           |                                                     
|Professional services                                                            | 5,850                                        | 26,487                                    | (37,404)                                            
|Salaries and benefits                                                            | 25,000                                       | 133,750                                   | 292,500                                             
|General and administrative                                                       | 72,508                                       | 79,642                                    | 169,257                                             
|Depreciation and amortization                                                    | -                                            | -                                         | -                                                   
|                                                                                 | 103,358                                      | 239,879                                   | 424,353                                             
|                                                                                 |                                              |                                           |                                                     
|Net pre-operating (loss)                                                         | (103,358)                                    | (239,879)                                 | (424,353)                                           
|                                                                                 |                                              |                                           |                                                     
|Other income (expenses):                                                         |                                              |                                           |                                                     
|Gain on forgiveness of debt                                                      | 98,870                                       |                                           |                                                     
|Interest                                                                         | (17,504)                                     | (17,504)                                  | (52,131)                                            
|Total other income (expense)                                                     | 81,366                                       | (17,504)                                  | (52,131)                                            
|                                                                                 |                                              |                                           |                                                     
|Net (loss) before
		discontinued operations                                      | (21,992)                                     | (257,383)                                 | (476,485)                                           
|                                                                                 |                                              |                                           |                                                     
|(Loss) from discontinued
		operations                                            | -                                            | -                                         | -                                                   
|                                                                                 |                                              |                                           |                                                     
|Net (loss)                                                                       | $     (21,992)                               | $    (257,383)                            | $    (476,485)                                      
|                                                                                 |                                              |                                           |                                                     
|Weighted average number of common shares outstanding -
		basic and fully diluted | 9,717,348                                    | 9,647,348                                 | 9,717,348                                           
|                                                                                 |                                              |                                           |                                                     
|Net (loss) per share before
		discontinued operations                            | $        (0.00)                              | $        (0.03)                           | $        (0.05)                                     
|Net (loss) per share from
		discontinued operations                              | 0.00                                         | 0.00                                      | 0.00                                                
|Net (loss) per share - basic
		and fully diluted                                 | $        (0.00)                              | $        (0.03)                           | $        (0.05)                                     



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



3

---



Twin Faces East
Entertainment Corporation

(a Development Stage
Company)

Statement of Cash
Flows

for the nine months
ended September 30, 2004

and for the period
December 5, 1997 (inception) to September 30, 2004



|                                                                       | For the nine
		months ended
		September 30, | December 5, 1997
		(inception) to September 30, 2004
|---------------------------------------------------------------------- | ------------------------------------------- | ----------------------------------------------------
|                                                                       | 2004                                        | 2003                                                
|Cash flows from operating
		activities                                 |                                             |                                                     
|Net (loss)                                                             | $    (476,485)                              | $    (1,063,197)                                    
|Depreciation                                                           | -                                           | -                                                   
|Prior period adjustment                                                | -                                           | -                                                   
|Shares issued for consulting
		services                                |                                             | 119,450                                             
|Shares issued for commission
		expense - related party                 |                                             |                                                     
|Shares issued for employment
		enticement                              | -                                           | -                                                   
|Shares issued for debt
		enticement                                    | -                                           | -                                                   
|Adjustments to reconcile net
		(loss) to net cash                      |                                             |                                                     
|(used) by operating
		activities:                                      |                                             |                                                     
|Increase in accrued salaries
		and benefits                            | 311,399                                     | 326,100                                             
|Increase in other accrued
		expenses                                   | 218,071                                     | 600,797                                             
|Net cash (used) by operating
		activities                              | 52,985                                      | (16,850)                                            
|                                                                       |                                             |                                                     
|Cash flows from investing
		activities                                 |                                             |                                                     
|Purchase of equipment                                                  | -                                           | -                                                   
|Investment in Magellan
		International, Inc.                           | -                                           | -                                                   
|Short-term note payable                                                | (73,000)                                    | -                                                   
|Proceeds from long-term debt                                           | 20,000                                      | -                                                   
|Payments on long-term debt                                             | -                                           | -                                                   
|Net cash provided by
		investing activities                            | (53,000)                                    | -                                                   
|                                                                       |                                             |                                                     
|Cash flows from financing
		activities                                 |                                             |                                                     
|Stockholders' advances                                                 | -                                           | -                                                   
|Issuance of common stock                                               | -                                           | -                                                   
|Net cash provided by
		financing activities                            | -                                           | -                                                   
|Net increase (decrease) in
		cash                                      | (15)                                        | (16,850)                                            
|                                                                       |                                             |                                                     
|Cash and equivalents -
		beginning                                     | 5                                           | 65                                                  
|Cash and equivalents - ending                                          | $             (10)                          | $               15                                  
|                                                                       |                                             |                                                     
|Supplemental disclosures:                                              |                                             |                                                     
|Interest paid                                                          | $                  -                        | $                  -                                
|Income taxes paid                                                      | $                  -                        | $                  -                                
|Non-cash transactions:                                                 |                                             |                                                     
|Shares issued for consulting
		services                                | $                  -                        | $                 -                                 
|Number of shares issued for
		consulting services                      |                                             |                                                     
|Shares issued for salaries -
		related party                           | $                 -                         | $                -                                  
|Number of shares issued for
		salaries - related party                 |                                             |                                                     
|Shares issued to invest in
		Pangaea Education Systems, Inc.           | $                 -                         | $               -                                   
|Number of shares issued to
		invest in Pangaea Education Systems, Inc. |                                             |                                                     
|Shares issued for employment
		enticement                              | $                 -                         | $               -                                   
|Number of shares issued for
		employment enticement                    |                                             |                                                     
|Shares issued for debt
		enticement                                    | $                 -                         | $                -                                  
|Number of shares issued for
		debt enticement                          |                                             |                                                     
|Number of shares issued for
		contractual payment to acquire Magellan  | $                 -                         | $                -                                  
|Shares issued for contractual
		payment to acquire Magellan            |                                             |                                                     
|Shares issued for commission
		expense                                 | $                 -                         | $                -                                  
|Number of shares issued for
		commission expense                       | -                                           | -                                                   



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



4

---

Twin Faces East
Entertainment Corporation

(a Development Stage
Company)

Notes
				to Unaudited Financial Statements





Note 1 - Basis of
Presentation



The condensed interim
financial statements included herein, presented in accordance with United States
generally accepted accounting principles and stated in US dollars, have been
prepared by the Company, without audit, pursuant to the rules and regulations of
the Securities and Exchange Commission. Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations, although the Company believes that the
disclosures are adequate to make the information presented not misleading.



These statements
reflect all adjustments, consisting of normal recurring adjustments, which in
the opinion of management are necessary for fair presentation of the information
contained therein. It is suggested that these condensed interim financial
statements be read in conjunction with the financial statements of the Company
for the year ended December 31, 2003 and notes thereto included in the Company's
10-KSB annual report. The Company follows the same accounting policies in the
preparation of interim reports.



Results of operation
for the interim period are not indicative of annual results.



Note 2 - Going
concern



The accompanying
financial statements have been prepared assuming that the Company will continue
as a going concern, which contemplates the recoverability of assets and the
satisfaction of liabilities in the normal course of business. As noted above,
the Company is in the development stage and, accordingly, has not yet generated
revenues from operations. Since its inception, the Company has been engaged
substantially in financing activities and developing its product line, setting
up its e-commerce website, and incurring substantial costs and expenses. As a
result, the Company incurred accumulated net losses from December 5, 1997
(inception) through the period ended September 30, 2004 of $5,270,462. In
addition, the Company's development activities since inception have been
financially sustained through equity financing.



The ability of the
Company to continue as a going concern is dependent upon its ability to raise
additional capital from the sale of common stock and, ultimately, the
achievement of significant operating revenues. The accompanying financial
statements do not include any adjustments that might be required should the
Company be unable to recover the value of its assets or satisfy its liabilities.



Note 3 - Notes Payable



The Company accrued $52,131 in
interest expense during the nine-month period ending September 30, 2004.



Note 4 - Related
party



The Company accrued a total of
$311,339 in salaries and benefits owed to its officers and directors during the
nine months ended September 30, 2004.



The Company accrued a total of
$218,071 in other expenses owed to its officers and directors during the nine
months ended September 30, 2004.



5

---

Twin Faces East
Entertainment Corporation

(a Development Stage
Company)

Notes
				to Unaudited Financial Statements



Note 5 - Gain on debt forgiveness



On August 11, 2004, the Company
negotiated the termination of its agreement for consulting services. in the
amount of $36,000. All services rendered have previously been accrued and
expensed by the Company.



On September 30, 2004, the Company
terminated consulting agreement due to non-performance in the amount of $53,000.
All services rendered have previously been accrued and expensed by the Company.



During the period ended September 30,
2004, the Company eliminated $9,870 previously disputed accrued legal fees. In
the processes of negotiating the disputed fees, the legal firm discontinued
operations. The Company has attempted to locate a successor firm and or estate
but has been unable to locate any concerned parties.



6

---



FORWARD-LOOKING
STATEMENTS



This document
		contains "forward-looking statements" within the meaning of the Private
		Securities Litigation Reform Act of 1995. All statements other than
		statements of historical fact are "forward-looking statements" for
		purposes of federal and state securities laws, including, but not
		limited to, any projections of earnings, revenue or other financial
		items; any statements of the plans, strategies and objections of
		management for future operations; any statements concerning proposed new
		services or developments; any statements regarding future economic
		conditions or performance; any statements or belief; and any statements
		of assumptions underlying any of the foregoing.



Forward-looking statements may include the words "may," "could,"
		"estimate," "intend," "continue," "believe," "expect" or "anticipate" or
		other similar words. These forward-looking statements present our
		estimates and assumptions only as of the date of this report. Except for
		our ongoing securities laws, we do not intend, and undertake no
		obligation, to update any forward-looking statement.



Although we believe
that the expectations reflected in any of our forward-looking statements are
reasonable, actual results could differ materially from those projected or
assumed in any or our forward-looking statements. Our future financial condition
and results of operations, as well as any forward-looking statements, are
subject to change and inherent risks and uncertainties. The factors impacting
these risks and uncertainties include, but are not limited to:

- our current
		lack of working capital;
- increased
		competitive pressures from existing competitors and new entrants;
- increases in
		interest rates or our cost of borrowing or a default under any material
		debt agreements;
- deterioration
		in general or regional economic conditions;
- adverse state
		or federal legislation or regulation that increases the costs of
		compliance, or adverse findings by a regulator with respect to existing
		operations;
- loss of
		customers or sales weakness;
- inability to
		achieve future sales levels or other operating results;
- the
		unavailability of funds for capital expenditures; and
- operational
		inefficiencies in distribution or other systems.

For a
		detailed description of these and other factors that could cause actual
		results to differ materially from those expressed in any forward-looking
		statement, please see "Factors That May Affect Our Plan of Operation" in
		this document.



Item 2. Management's
Discussion and Analysis or Plan of Operation



Overview



Twin Faces was
incorporated on December 5, 1997 under the laws of the State of Delaware and
reincorporated under the laws of the State of Nevada on June 17, 1998. We are in
the development stage as an entertainment and film production company.



We have yet to
generate revenues from operating activities and there is a substantial going
concern issue as to whether we will ever be able to produce and market our films
and generate sufficient, if any, revenues to satisfy our working capital
requirements. Since inception we have been dependent on the sale of our equity
securities and loans from affiliates to satisfy our working capital
requirements. We continue to have a working capital deficiency that raises
substantial concern regarding our ability to continue as a going concern.



7

---



Plan of Operation



During the next
twelve months we will continue to focus our efforts on our development of four
primary properties, including, "Pages From A Rabbit Journal", "The Town That
Arrested Santa Claus", "Einstein" property, and the production of a new feature
film, "A Real Man", written by Johnnie King, our Director of Film Development;
however actual production will not commence until we have sufficient capital for
production and marketing.



We have recently
finished "The Town That Arrested Santa Claus", a fully illustrated children's
story book narrative in animation, with the assistance of Pro Image, Inc.
("PI"), a New York corporation. We have a five year Music Duplication and
Distribution Agreement with PI, executed on October 20, 2003. We are also
working on the documentary "Einstein The Real Man" with PI and plan to have it
completed by the 2nd quarter of 2005. The Einstein properties are the
result of Dr. Smolanoff's acquisition of original 16mm film footage of rare
moments such as family vacation when Einstein wrote the fateful letter to
Franklin D. Roosevlet that led to the Manhattan Project.



On August 11, 2004,
we negotiated the termination of the Development Financing Agreement with O'Dea
& Company LLC regarding consulting services in the amount of $36,000.



On September 30,
2004, we terminated our consulting agreement with Magellan Concepts
International, Inc. due to non-performance in the amount of $53,000.



Satisfaction of our
cash obligations for the next 12 months.



Our plan of operation
has been stalled by our lack of cash. Under our current plan of operation we
will be required to raise at least $800,000 in equity or debt financing (minimal
cash requirement) to continue in operation for the next 12 months.



Investment Agreement
and Promissory Note



On June 20, 2003, we
entered into an Investment Agreement with Johnnie King, our Director of Film
Development. On September 29, 2003, we executed a new Investment Agreement with
Mr. King to extend the funding dates that we previously agreed on in the June
20th agreement. On November 16, 2004, we amended that agreement to extend the
funding dates until September 29, 2005. Pursuant to the terms of the agreement,
Mr. King will make a direct $4,000,000 cash investment as purchase of series C
preferred stock. Within 30 days of funding we will issue 1,000,000 shares of
series C preferred stock of the Company to Mr. King. The stock will carry
conversion rights to common on an annual basis the first week of the funding
month each year commencing the month of funding, for a period of 4 years
according to the formula below.

> The preferred stock
> shall be converted to common stock in the Company on the dates following:
> 	
> 	One year from
> 		funding date, conversion of 250,000 shares preferred stock to common
> 		stock,
> 	Two years
> 		from funding date, conversion of 250,000 shares preferred stock to
> 		common stock,
> 	Three years
> 		from funding date, conversion of 250,000 shares preferred stock to
> 		common stock,
> 	Four years
> 		from funding date, conversion of 250,000 shares preferred stock to
> 		common stock.



8

---



> We will issue a 5%
> cash dividend on the principle amount of the unconverted preferred stock,
> payable in common stock as follows:
> 	
> 	One year from
> 		funding date, $200,000 of common stock,
> 	Two years
> 		from funding date, $120,000 of common stock,
> 	Three years
> 		from funding date, $100,000 of common stock,
> 	Four years
> 		from funding date, $50,000 of common stock.
> 	
> 	At our option the
> preferred stock shall be converted according to either of the following:

Option 1- Average
prior 30 days closing price on current quoted exchange or quotation service so
the market value of the common stock issued is one million five hundred thousand
dollars ($1,500,000). For example, if the funding date is December 31, 2003, and
if the 30-day average quoted closing price is $1 per share on December 31, 2004,
Mr. King will receive 1,500,000 shares of common stock for his 250,000 shares of
preferred stock for a valuation conversion of 6 common shares for each preferred
share.



Option 2- The
stock may be converted at a conversion ratio of 2 common shares for each
preferred share. For example, if the funding date is December 31, 2003, on
December 31, 2004 we may convert the 250,000 shares of preferred stock to
500,000 shares of common stock in the Company.



On June 20, 2003, we
executed a Promissory Note with Johnnie King, our Director of Film Development
for the principal amount of $4,000,000. On September 29, 2003, we executed a new
Promissory Note to extend the funding dates under the note. On November 16,
2004, we amended that agreement to extend the funding date until September 29,
2005 and the due date is on or before five years from the funding date. Pursuant
to the note we promise to pay to the order of Johnnie King the sum of $4,000,000
together with interest thereon at 10% per annum as prescribed below. The sum and
interest shall be paid in the manner following:

> Interest due one year
> from funding date-
> 	Payable as
> 		$400,000 worth of 144 restricted stock or $400,000 cash
> 	Interest due two
> years from funding date-
> 	Payable as
> 		$400,000 worth of 144 restricted stock or $400,000 cash
> 	Interest due three
> years from funding date-
> 	Payable as
> 		$400,000 worth of 144 restricted stock or $400,000 cash
> 	Interest due four
> years from funding date-
> 	Payable as
> 		$400,000 worth of 144 restricted stock or $400,000 cash

At the principal due
date of the note, we agree to pay to Mr. King, at our option either $4,400,000
cash or $4,800,000 worth of 144 restricted stock.



We may prepay the
promissory note at any time, without penalty, by delivery of the principal
amount in cash and appropriate pro-rata interest as prescribed above.



As of the
		date of this filing we have not yet received any funds from Mr. King.
		Upon receipt of funds we will file a Form 8-K.



Investment
		Agreement/Preferred Stock Purchase



On November
		11, 2003, we executed an Investment Agreement/Preferred Stock Purchase
		with Michael Smolanoff, our President, wherein he agreed to make a
		direct cash investment into the Company as a result of proceeds from his
		pending Bronx County New York legal action ("lawsuit"). The first
		funding date of the investment will be no later than 30 days after the
		first receipt of funds from the lawsuit and the final funding date shall
		be no later than 30 days after the final payment from the lawsuit. The
		amount of the investment is the lesser of four million dollars
		($4,000,000) or fifty percent (50%) of the total amount received from
		the lawsuit. Within 30 days of the first funding date, we will issue one
		million (1,000,000) shares of our series C preferred Stock to Dr.
		Smolanoff. The stock will carry conversion rights to common on an annual
		basis the first week of the funding month each year commencing the month
		of funding, for a period of 4 years.



9

---

> The preferred
> 		stock shall be converted to common stock in the Company on the following
> 		dates:
> 	
> 	One year from
> 		first funding date, conversion of 250,000 shares preferred stock to
> 		common Stock,
> 	Two years
> 		from first funding date, conversion of 250,000 shares preferred stock to
> 		common Stock,
> 	Three years
> 		from final funding date, conversion of 250,000 shares preferred stock to
> 		common Stock,
> 	Four years
> 		from final funding date, conversion of 250,000 shares preferred stock to
> 		common Stock.
> 	
> 	At our option
> 		the stock shall be converted according to either of the following:

Option 1-
		Average prior 30 days closing price on current quoted exchange so that
		market value of the common issued is one million five hundred thousand
		dollars. For example, if funding date is December 31, 2003, and if the
		30-day average quoted closing price is $1 per share on December 31,
		2004, Dr. Smolanoff would receive 1,500,000 shares of common stock for
		his 250,000 shares of Preferred stock for a valuation conversion of 6
		common shares for each preferred share.



Option 2-
		The stock may be converted at a conversion ratio of 2 common shares for
		each preferred share. For example, if funding date is December 31, 2003,
		on December 31, 2004 we may convert the 250,000 shares of preferred
		stock to 500,000 shares of common stock.



We also
		agreed to issue a 5% cash dividend on the principle amount of the
		unconverted preferred stock, payable in common stock as follows:

> One year from
> 		first funding date, cash dividend in common stock,
> 	Two years
> 		from first funding dated, cash dividend in common stock,
> 	Three years
> 		from final funding date, cash dividend in common stock,
> 	Four years
> 		from final funding date, cash dividend in common stock.

As of the
		date of this filing we have not yet received any funds from Dr.
		Smolanoff. Upon receipt of funds we will file a Form 8-K.



A critical
		component of our operating plan impacting our continued existence is the
		ability to obtain additional capital through additional equity and/or
		debt financing. We do not anticipate enough positive internal operating
		cash flow until such time as we can generate substantial revenues from
		fees earned as a result of our documentary films of Dr. Albert Einstein
		and feature film and television scripts, which may take the next few
		years to fully realize. In the event we cannot obtain the necessary
		capital to pursue our strategic plan, we may have to cease or
		significantly curtail our operations. This would materially impact our
		ability to continue operations.



Our near term cash
requirements are anticipated to be offset through the receipt of funds from
private placement offerings and loans obtained through private sources and
persons affiliated with the Company. Since inception, we have financed cash flow
requirements through debt financing and issuance of common stock for cash and
services. As we expand operational activities, we may continue to experience net
negative cash flows from operations, pending receipt of servicing or licensing
fees, and will be required to obtain additional financing to fund operations
through common stock offerings and bank borrowings to the extent necessary to
provide working capital.



10

---



Over the next twelve
months we believe that existing capital and anticipated funds from operations
will not be sufficient to sustain operations and planned expansion.
Consequently, we will be required to seek additional capital in the future to
fund growth and expansion through additional equity or debt financing or credit
facilities. No assurance can be made that such financing would be available, and
if available it may take either the form of debt or equity. In either case, the
financing could have a negative impact on our financial condition and our
stockholders.



We anticipate
incurring operating losses over the next twelve months. Our lack of operating
history makes predictions of future operating results difficult to ascertain.
Our prospects must be considered in light of the risks, expenses and
difficulties frequently encountered by companies in their early stage of
development. Such risks include, but are not limited to, an evolving and
unpredictable business model and the management of growth. To address these
risks we must, among other things, obtain a customer base, implement and
successfully execute our business and marketing strategy, continue to develop
and upgrade technology and products, respond to competitive developments, and
attract, retain and motivate qualified personnel. There can be no assurance that
we will be successful in addressing such risks, and the failure to do so can
have a material adverse effect on our business prospects, financial condition
and results of operations.



Going Concern



The consolidated
financial statements included in this filing have been prepared in conformity
with generally accepted accounting principles that contemplate the continuance
of the Company as a going concern. The Company's cash position may be inadequate
to pay all of the costs associated with production and marketing. Management
intends to use borrowings and security sales to mitigate the effects of its cash
position, however no assurance can be given that debt or equity financing, if
and when required will be available. The financial statements do not include any
adjustments relating to the recoverability and classification of recorded assets
and classification of liabilities that might be necessary should the Company be
unable to continue existence.



Summary of any
product research and development that we will perform for the term of our plan
of operation.



We do not anticipate
performing any significant product research and development under our plan of
operation.



Expected purchase or
sale of plant and significant equipment.



We do not anticipate
the purchase or sale of any plant or significant equipment, as such items are
not required by us at this time or in the next 12 months.



Significant changes
in the number of employees.



We have 5 employees.
In the event we are successful in obtaining additional debt or equity, which
will provide us with the cash to develop an entertainment product, then in that
event we will be required to hire additional full time staff members.



11

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Off-Balance Sheet
Arrangements



We do not have any
off-balance sheet arrangements that have or are reasonably likely to have a
current or future effect on our financial condition, changes in financial
condition, revenues or expenses, results of operations, liquidity, capital
expenditures or capital resources that is material to investors.



FACTORS THAT MAY
AFFECT OUR PLAN OF OPERATION



Twin Faces has historically lost
money and losses may continue in the future, which may cause us to curtail
operations.



Since our inception
we have not been profitable and have lost money on both a cash and non-cash
basis. For the years ended December 31, 2003 and December 31, 2002 we incurred
net losses of $1,330,646 and $1,356,952 respectively. Our accumulated deficit at
the end of September 30, 2004 was $5,270,462. Future losses are likely to occur,
as we are dependent on spending money to pay for our operations. No assurances
can be given that we will be successful in reaching or maintaining profitable
operations. Accordingly, we may experience liquidity and cash flow problems. If
our losses continue, our ability to operate may be severely impacted.



Twin Faces will need
to raise additional capital or debt funding to sustain operations.



We will
		require additional capital to sustain operations and we may need access
		to additional capital or additional debt financing to grow our sales. In
		addition, to the extent that we have a working capital deficit and
		cannot offset the deficit from profitable sales we may have to raise
		capital to repay the deficit and provide more working capital to permit
		growth in revenues. We cannot be assured that financing whether from
		external sources or related parties will be available if needed or on
		favorable terms. Our inability to obtain adequate financing will result
		in the need to reduce the pace of business operations.



We have been the
subject of a going concern opinion for the years ended December 31, 2003 and
December 31, 2002 from our independent auditors, which means that we may not be
able to continue operations unless we can become profitable or obtain additional
funding.



Our
		independent auditors have added an explanatory paragraph to their audit
		opinions issued in connection with our financial statements for the
		years ended December 31, 2003 and December 31, 2002, which states that
		the financial statements raise substantial doubt as to our ability to
		continue as a going concern. Our ability to make operations profitable
		or obtain additional funding will determine our ability to continue as a
		going concern. Our financial statements do not include any adjustments
		that might result from the outcome of this uncertainty. We expect to be
		able to continue operations for twelve months with the cash currently on
		hand, anticipated from our operations and from the investment agreement
		and promissory note with Johnnie King for an investment of $8,000,000 in
		combination of preferred stock and debt. Also, from an investment
		agreement with Michael Smolanoff for an investment of $4,000,000 upon
		settlement of a lawsuit in his favor.



We are subject to a
working capital deficit, which means that our current assets on December 31,
2003 and for the Quarter ended September 2004, were not sufficient to satisfy
our current liabilities and, therefore, our ability to continue operations is at
risk.



We had a
		working capital deficit for the year ended December 31, 2003 and for the
		quarter ended September 30, 2004, which means that our current
		liabilities exceeded our current assets on December 31, 2003 by
		$3,246,857 and by $3,703,492 on September 30, 2004. Current assets are
		assets that are expected to be converted to cash within one year and,
		therefore, may be used to pay current liabilities as they become due.
		Our working capital deficit means that our current assets on December
		31, 2003, and on September 30, 2004 were not sufficient to satisfy all
		of our current liabilities on those dates. If our ongoing operations do
		not begin to provide sufficient profitability to offset the working
		capital deficit, we may have to raise capital or debt to fund the
		deficit or curtail future operations.



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Our common stock is
deemed to be "Penny Stock," which may make it more difficult for investors to
sell their shares due to suitability requirements.



Our common stock is
deemed to be "penny stock" as that term is defined in Rule 3a51-1 promulgated
under the Securities Exchange Act of 1934. These requirements may reduce the
potential market for our common stock by reducing the number of potential
investors. This may make it more difficult for investors in our common stock to
sell shares to third parties or to otherwise dispose of them. This could cause
our stock price to decline. Penny stocks are stock:

- With a price
		of less than $5.00 per share;
- That are not
		traded on a "recognized" national exchange;
- Whose prices
		are not quoted on the NASDAQ automated quotation system (NASDAQ listed
		stock must still have a price of not less than $5.00 per share); or
- In issuers
		with net tangible assets less than $2.0 million (if the issuer has been
		in continuous operation for at least three years) or $10.0 million (if
		in continuous operation for less than three years), or with average
		revenues of less than $6.0 million for the last three years.

Broker/dealers
dealing in penny stocks are required to provide potential investors with a
document disclosing the risks of penny stocks. Moreover, broker/dealers are
required to determine whether an investment in a penny stock is a suitable
investment for a prospective investor.



We could fail to
attract or retain key personnel, which could be detrimental to our operations.



Our success largely
depends on the efforts and abilities of key executives, including Michael
Smolanoff Ph.D., our Chief Executive Officer. The loss of the services of Dr.
Smolanoff could materially harm our business because of the cost and time
necessary to find a successor. Such a loss would also divert management
attention away from operational issues. We presently do not maintain key-man
life insurance policies on Dr. Smolanoff. We also have other key employees who
manage our operations and if we were to lose their services, senior management
would be required to expend time and energy to replace and train their
replacements. To the extent that we are smaller than our competitors and have
fewer resources we may not be able to attract the sufficient number and quality
of staff.



Our limited operating
history makes it difficult to forecast our future results.



As a result
		of our limited operating history, our historical financial and operating
		information is of limited value in predicting our future operating
		results. We may not accurately forecast customer behavior and recognize
		or respond to emerging trends, changing preferences or competitive
		factors facing us, and, therefore, we may fail to make accurate
		financial forecasts. Our current and future expense levels are based
		largely on our investment plans and estimates of future revenue. As a
		result, we may be unable to adjust our spending in a timely manner to
		compensate for any unexpected revenue shortfall, which could force us to
		curtail or cease our business operations.



Item 3. Controls and
Procedures.



We maintain
disclosure controls and procedures designed to ensure that information required
to be disclosed in reports filed under the Securities Exchange Act of 1934, as
amended, is recorded, processed, summarized and reported within the specified
time periods. As of the end of the period covered by this report, our officers
and directors evaluated the effectiveness of our disclosure controls and
procedures. Based on the evaluation, which disclosed no significant deficiencies
or material weaknesses, our officers and directors concluded that our disclosure
controls and procedures are effective. There were no changes in our internal
control over financial reporting that occurred during our most recent fiscal
quarter that have materially affected, or are reasonably likely to materially
affect, our internal control over financial reporting.



13

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PART II - OTHER
INFORMATION



Item 1. Legal
Proceedings.



None.



Item 2. Unregistered
Sales of Equity Securities and Use of Proceeds.



None.



Item 3. Defaults Upon
Senior Securities.



None.



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



None.



Item 5. Other
Information.



None.



Item 6. Exhibits.



|31.1 | Certification
		of Michael Smolanoff Pursuant to Section 302 of the Sarbanes-Oxley Act
|---- | --------------------------------------------------------------------------------------
|31.2 | Certification
		of Stanley L. Teeple Pursuant to Section 302 of the Sarbanes-Oxley Act
|32.1 | Certification
		of Michael Smolanoff Pursuant to Section 906 of the Sarbanes-Oxley Act
|32.2 | Certification
		of Stanley L. Teeple Pursuant to Section 906 of the Sarbanes-Oxley Act



SIGNATURES



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



TWIN FACES EAST ENTERTAINMENT
CORPORATION

(Registrant)





By: /s/ Stanley L. Teeple

Stanley L. Teeple, Chief
Financial Officer

(On behalf of the registrant and as

principal accounting officer)





Date: November 22, 2004