UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


WASHINGTON,
D.C. 20549





FORM
10-Q/A


(Amendment
No. 1)





x Quarterly Report
pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934.


For the
fiscal quarter ended June 30, 2008





o Transition Report under
Section 13 or 15(d) of the Securities Exchange Act of 1934.


For the
transition period from _____ to _____.





Commission
File No. 0-26669





Can-Cal Resources
Ltd.


(Name of
Small Business Issuer in its charter)




Nevada
              88-0336988(State
      or other jurisdiction of

                  incorporation
      or organization)
              (I.R.S.
      Employer Identification No.)


2500 Vista Mar Drive, Las
Vegas, NV 89128


(Address
of principal executive offices)





(702)
243-1849


(Issuer's
telephone number)





N/A


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





Check
whether the issuer (1) filed all reports required to be filed by Section 13 or
15(d) of the Exchange Act during the past 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days. Yes x No o





State the
number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:


Class
              
              Outstanding on August
      14, 2008Common
      Stock, Par Value $.001.
              
              24,587,753





Transitional
Small Business Disclosure Format (Check one): Yes o No x


EXPLANATORY
NOTE
  This
quarterly report on Form 10-Q/A (“Form 10-Q/A”) for the fiscal quarter
ended June 30, 2008 is filed to amend the following:
  ·
            Footnote
      #6, within Item 7 of Part I to present the Company’s financial statements
      in accordance with the required presentation. As an Exploration Stage
      Company, under paragraph 11 of SFAS 7 the Company has to include certain
      unaudited “inception to date” amounts, including the details of all the
      terms of each stock issuance from
inception.  ·
            To
      remove extraneous pages #8 and #9 that were mistakenly included in the
      filing during submission.  Events
have taken place that would have been reflected in the original Form 10-Q if
they had taken place prior to the date of the original and amended filings. The
Company recommends this report be read in conjunction with the Company’s reports
filed subsequent to August 20, 2008.







CAN CAL
RESOURCES, LTD.


(An Exploration Stage Company)




JUNE 30,
2008 QUARTERLY REPORT ON FORM 10-Q




TABLE OF
CONTENTS




PAGE
      NO.PART
      I.
              
              FINANCIAL
      INFORMATION
              
              4ITEM
      1.
              
              FINANCIAL
      STATEMENTS
              
              4Balance
      Sheets
              
              4Statements
      of Operations
              
              5Statements
      of Stockholders’ Equity (Deficit)
              
              6Statements
      of Cash Flows
              
              7Notes
      to Financial Statements
              
              8ITEM
      2.
              
              Management's
      Discussion and Analysis of  Financial
      Condition
              
              18ITEM
      3.
              
              Quantitative
      and Qualitative Disclosures about Market Risk
              24ITEM
      4.
              
              Controls
      and Procedures
              
              24PART
      II.
              
              OTHER
      INFORMATION
              
              25ITEM
      1.
              
              Legal
      Proceedings
              
              25ITEM
      2.
              
              Changes
      in Securities
              
              25ITEM
      3.
              
              Defaults
      upon Senior Securities
              
              25ITEM
      4.
              
              Submission
      of Matters to a Vote of Security Holders
              
              25ITEM
      5.
              
              Other
      information
              
              25ITEM
      6.
              
              Exhibits
      and Reports on Form 8-K
              
              26SignaturesCertifications




2




FORWARD
LOOKING STATEMENTS





Section
27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934 provide a "safe harbor" for forward looking statements that are based on
current expectations, estimates and projections, and management's beliefs and
assumptions. Words such as "believes," "expects," "intends," "plans,"
"estimates," "may," "attempt," "will," "goal," "promising," or variations of
such words and similar expressions are intended to identify such forward-looking
statements. These statements are not guarantees of future performance and
involve certain risks and uncertainties which are difficult or impossible to
predict. Therefore, actual outcomes and results may differ materially from what
is expressed or forecasted in such forward-looking


statements.
The Company undertakes no obligation to update publicly any forward-looking
statement whether as a result of new information, future events or
otherwise.





Such
risks and uncertainties include, but are not limited to, the availability of
metal ore; negative or inconsistent test results, the existence of precious
metals in the metal ore available to the Company in an


amount
which permits their production on an economic basis; the Company's ability to
drill holes and properly test and assay samples, and its ability to locate and
acquire mineral properties which contain sufficient grades of precious metals
and/or minerals; the Company's ability to sell a portion or all of any of its
properties to larger mining companies, or to enter into agreements with larger
mining companies to explore and possibly develop its properties; to produce
precious metals on a commercial basis, the prices of precious metals; obtaining
a mill or refinery to extract precious metals on an economic basis; the ability
to maintain the facilities it currently utilizes;


obtain
permitting requirements for any mining and milling operations and pay the costs
thereof; have good title to claims and equipment; and the Company's ability to
obtain financing necessary to maintain its operations.





3




PART I.
FINANCIAL INFORMATION




Can-Cal Resources
      Ltd.(An Exploration Stage
      Company)Condensed Balance
      Sheets
  June
      30,
              
              December
      31,2008
              
              2007(Unaudited)
              
              (Audited)ASSETSCurrent
      assetsCash
              
              $
              72,827
              
              $
              105,987Other
      current assets
              
              
              5,100
              
              
              -Total
      current assets
              
              
              77,927
              
              
              105,987Property,
      equipment and mineral interests (net of accumulateddepreciation
      of $131,890 and $125,894)
              
              
              505,725
              
              
              511,720Other
      assets, net
              
              
              1,895
              
              
              1,895Total
      assets
              
              $
              585,547
              
              $
              619,602LIABILITIES
      AND STOCKHOLDERS' DEFICITCurrent
      liabilitiesAccounts
      payable
              
              $
              23,868
              
              $
              28,399Accrued
      interest
              
              
              339,391
              
              
              311,320Accrued
      officer salary
              
              
              160,149
              
              
              110,652Accrued
      payroll taxes
              
              
              458
              
              
              21,853Notes
      payable, related parties
              
              
              395,630
              
              
              360,550Notes
      payable
              
              
              83,500
              
              
              -Unearned
      revenues
              
              
              47,061
              
              
              9,375Total
      current liabilities
              
              
              1,050,057
              
              
              842,149Total
      liabilities
              
              
              1,050,057
              
              
              842,149Stockholders'
      deficitPreferred
      stock; $0.001 par value; 10,000,000 sharesauthorized,
      no shares issued and outstanding
              
              
              -
              
              
              -Common
      stock; $0.001 par value; 100,000,000 shares authorized,24,587,753
      and 24,555,253 shares issued and outstanding,
      respectively
              
              
              24,588
              
              
              24,555Additional
      paid-in capital
              
              
              7,831,503
              
              
              7,823,411Accumulated
      deficit
              
              
              (8,320,601
              )
              
              (8,070,513
              )Total
      stockholders' deficit
              
              
              (464,510
              )
              
              (222,547
              )Total
      liabilities and stockholders' deficit
              
              $
              585,547
              
              $
              619,602
  See
Accompanying Notes to Financial Statements
  4
 Can-Cal Resources
      Ltd.(An Exploration Stage
      Company)Condensed Statements of
      Operations(Unaudited)
  For
      the Three Months Ended
                      June
      30,
                
                For
      the Six Months Ended
                      June
      30,
                
                March
      22, 1995
                        (Inception)
                        to
      June 30,2008
                
                2007
                
                2008
                
                2007
                
                2008Material
      sales
                
                $
                -
                
                $
                -
                
                $
                -
                
                $
                -
                
                $
                245,500Cost
      of sales
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                263,400Gross
      profit
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                (17,900
                )Operating
      expensesExploration
      costs
                
                
                20,991
                
                
                55,635
                
                
                38,905
                
                
                102,943
                
                
                407,432Depreciation
                
                
                2,998
                
                
                3,816
                
                
                5,995
                
                
                6,021
                
                
                226,320General
      and administrative
                
                
                85,645
                
                
                58,251
                
                
                142,640
                
                
                106,745
                
                
                5,899,666Officer
      compensation
                
                
                29,008
                
                
                32,886
                
                
                60,000
                
                
                64,052
                
                
                671,176Total
      operating expenses
                
                
                138,642
                
                
                150,588
                
                
                247,540
                
                
                279,761
                
                
                7,204,594Loss
      from operations
                
                
                (138,642
                )
                
                (150,588
                )
                
                (247,540
                )
                
                (279,761
                )
                
                (7,222,494
                )Other
      income (expense)Other
      income from legal judgement
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                47,200Interest
      income
                
                
                4
                
                
                3,505
                
                
                102
                
                
                6,959
                
                
                52,890Rental
      revenue
                
                
                16,689
                
                
                5,625
                
                
                26,614
                
                
                11,250
                
                
                258,614Gain
      (loss) on sale of fixed assets
                
                
                -
                
                
                3,701
                
                
                -
                
                
                3,701
                
                
                26,801Interest
      expense
                
                
                (15,460
                )
                
                (14,307
                )
                
                (29,264
                )
                
                (28,887
                )
                
                (1,010,012
                )Total
      other income (expense)
                
                
                1,233
                
                
                (1,476
                )
                
                (2,548
                )
                
                (6,977
                )
                
                (624,507
                )Loss
      before provision for income taxes
                
                
                (137,409
                )
                
                (152,064
                )
                
                (250,088
                )
                
                (286,738
                )
                
                (7,847,001
                )Provision
      for income taxes
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -Net
      loss from continuing operations
                
                
                (137,409
                )
                
                (152,064
                )
                
                (250,088
                )
                $
                (286,738
                )
                
                (7,847,001
                )Income
      from discontinued operationsIncome
      (loss) from discontinued operations
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                116,400Gain
      (loss) on disposal of operations (net of taxes)
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                (590,000
                )Net
      loss
                
                $
                (137,409
                )
                $
                (152,064
                )
                $
                (250,088
                )
                $
                (286,738
                )
                $
                (8,320,601
                )Basic
      loss per common share
                
                $
                (0.01
                )
                $
                (0.01
                )
                $
                (0.01
                )
                $
                (0.01
                )Basic
      weighted average common shares outstanding
                
                
                24,587,753
                
                
                24,157,828
                
                
                24,584,884
                
                
                23,922,171
 See
Accompanying Notes to Financial Statements
  5
 Can-Cal Resources
Ltd.
 (An Exploration Stage
Company)
 Condensed Statement of Stockholders'
Equity (Deficit)
 (Unaudited)
 ForeignCommon
      Stock
                    
                    Additional
                    
                    
                    
                    Currency
                    
                    
                    
                    TotalNumber
      of
                    
                    
                    
                    Paid-in
                    
                    
                    
                    Translation
                    
                    Accumulated
                    
                    Stockholders'Shares
                    
                    Amount
                    
                    Capital
                    
                    Unamortized
                    
                    Adjustment
                    
                    (Deficit)
                    
                    (Deficit)Balance
      March 22, 1995
                    
                    
                    -
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    -Common
      shares issued for services
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -Net
      loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (1,000
                    )
                    
                    (1,000
                    )Balance
      December 31, 1995
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (1,000
                    )
                    
                    (1,000
                    )Common
      shares issued for services
                    
                    
                    3,441,217
                    
                    
                    3,400
                    
                    
                    625,000
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    628,400Prior
      period adjustment, investment in joint venture
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    497,900
                    
                    
                    497,900Net
      loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (497,000
                    )
                    
                    (497,000
                    )Balance
      December 31, 1996
                    
                    
                    3,441,217
                    
                    
                    3,400
                    
                    
                    625,000
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (100
                    )
                    
                    628,300Common
      shares issued for services
                    
                    
                    3,006,435
                    
                    
                    3,000
                    
                    
                    1,051,400
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    1,054,400Net
      loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (1,044,700
                    )
                    
                    (1,044,700
                    )Balance
      December 31, 1997
                    
                    
                    6,447,652
                    
                    
                    6,400
                    
                    
                    1,676,400
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (1,044,800
                    )
                    
                    638,000Common
      shares issued for cash
                    
                    
                    557,509
                    
                    
                    600
                    
                    
                    211,200
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    211,800Foreign
      currency translation adjustment
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    8,500
                    
                    
                    -
                    
                    
                    8,500Net
      loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (353,000
                    )
                    
                    (353,000
                    )Balance
      December 31, 1998
                    
                    
                    7,005,161
                    
                    
                    7,000
                    
                    
                    1,887,600
                    
                    
                    -
                    
                    
                    8,500
                    
                    
                    (1,397,800
                    )
                    
                    505,300Common
      shares issued for cash
                    
                    
                    1,248,621
                    
                    
                    1,200
                    
                    
                    572,600
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    573,800Foreign
      currency translation adjustment
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (11,800
                    )
                    
                    -
                    
                    
                    (11,800
                    )Realized
      foreign currency translation loss
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    3,300
                    
                    
                    -
                    
                    
                    3,300Prior
      period Adjustment
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    15,000
                    
                    
                    15,000Elimination
      of subsidiary upon disposal
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    116,400
                    
                    
                    116,400Net
      loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (1,038,500
                    )
                    
                    (1,038,500
                    )Balance
      December 31, 1999
                    
                    
                    8,253,782
                    
                    
                    8,200
                    
                    
                    2,460,200
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (2,304,900
                    )
                    
                    163,500Common
      shares issued for cash
                    
                    
                    1,119,009
                    
                    
                    1,200
                    
                    
                    948,400
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    949,600Net
      loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (962,500
                    )
                    
                    (962,500
                    )Balance
      December 31, 2000
                    
                    
                    9,372,791
                    
                    
                    9,400
                    
                    
                    3,408,600
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (3,267,400
                    )
                    
                    150,600Common
      shares issued for cash
                    
                    
                    785,947
                    
                    
                    800
                    
                    
                    81,500
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    82,300Net
      loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (704,500
                    )
                    
                    (704,500
                    )Balance
      December 31, 2001
                    
                    
                    10,158,738
                    
                    
                    10,200
                    
                    
                    3,490,100
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (3,971,900
                    )
                    
                    (471,600
                    )Common
      shares issued for cash
                    
                    
                    1,093,280
                    
                    
                    1,100
                    
                    
                    269,900
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    271,000Common
      shares issued for services
                    
                    
                    92,292
                    
                    
                    100
                    
                    
                    23,800
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    23,900Options
      granted for services
                    
                    
                    -
                    
                    
                    -
                    
                    
                    7,100
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    7,100Common
      shares issued for repayment of note payable, related party in the amount
      of $119,800, including accrued interest of $71,800
                    
                    
                    309,677
                    
                    
                    300
                    
                    
                    119,500
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    119,800Warrants
      granted for loan fees onconvertible
      notes payable, related party
                    
                    
                    -
                    
                    
                    -
                    
                    
                    16,700
                    
                    
                    (16,700
                    )
                    
                    -
                    
                    
                    -
                    
                    
                    -Common
      shares issued for loan fees onconvertible
      notes payable, related party
                    
                    
                    30,000
                    
                    
                    -
                    
                    
                    13,500
                    
                    
                    (13,500
                    )
                    
                    -
                    
                    
                    -
                    
                    
                    -Deemed
      interest on beneficial conversionfeature
      of notes payable, related party
                    
                    
                    -
                    
                    
                    -
                    
                    
                    20,500
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    20,500Amortization
      of loan fees
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    8,200
                    
                    
                    -
                    
                    
                    -
                    
                    
                    8,200Net
      loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (709,300
                    )
                    
                    (709,300
                    )Balance
      December 31, 2002
                    
                    
                    11,683,987
                    
                    
                    11,700
                    
                    
                    3,961,100
                    
                    
                    (22,000
                    )
                    
                    -
                    
                    
                    (4,681,200
                    )
                    
                    (730,400
                    )Common
      shares issued for cash
                    
                    
                    823,410
                    
                    
                    800
                    
                    
                    163,900
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    164,700Common
      shares issued for services
                    
                    
                    381,260
                    
                    
                    400
                    
                    
                    63,800
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    64,200Options
      granted for services
                    
                    
                    -
                    
                    
                    -
                    
                    
                    61,300
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    61,300Common
      shares issued for repayment of note payable, related party in the amount
      of $78,300, including accrued interest of $43,300
                    
                    
                    364,305
                    
                    
                    400
                    
                    
                    77,900
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    78,300Deemed
      interest on beneficial conversionfeature
      of notes payable, related party
                    
                    
                    -
                    
                    
                    -
                    
                    
                    38,300
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    38,300Amortization
      of loan fees
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    15,000
                    
                    
                    -
                    
                    
                    -
                    
                    
                    15,000Net
      loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (711,100
                    )
                    
                    (711,100
                    )Balance
      December 31, 2003
                    
                    
                    13,252,962
                    
                    
                    13,300
                    
                    
                    4,366,300
                    
                    
                    (7,000
                    )
                    
                    -
                    
                    
                    (5,392,300
                    )
                    
                    (1,019,700
                    )Common
      shares issued for cash
                    
                    
                    1,564,311
                    
                    
                    1,600
                    
                    
                    306,400
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    308,000Common
      shares issued for exercise of warrants
                    
                    
                    701,275
                    
                    
                    700
                    
                    
                    124,900
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    125,600Common
      shares issued for services
                    
                    
                    390,224
                    
                    
                    400
                    
                    
                    73,800
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    74,200Warrants
      granted for services
                    
                    
                    -
                    
                    
                    -
                    
                    
                    12,200
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    12,200Interest
      expense for warrants granted
                    
                    
                    -
                    
                    
                    -
                    
                    
                    280,200
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    280,200Common
      shares issued in satisfaction of accounts payableand
      accrued liabilities in the amount of $229,400
                    
                    
                    917,747
                    
                    
                    900
                    
                    
                    228,500
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    229,400Common
      shares issued for repayment of note payable in theamount
      of $99,700, including accrued interest of $14,700
                    
                    
                    702,760
                    
                    
                    700
                    
                    
                    99,000
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    99,700Common
      shares issued for repayment of note payable,related
      party in the amount of $82,700
                    
                    
                    330,747
                    
                    
                    300
                    
                    
                    82,400
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    82,700Deemed
      interest on beneficial conversionfeature
      of notes payable, related party
                    
                    
                    -
                    
                    
                    -
                    
                    
                    17,600
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    17,600Amortization
      of loan fees
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    7,000
                    
                    
                    -
                    
                    
                    -
                    
                    
                    7,000Net
      loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (1,030,500
                    )
                    
                    (1,030,500
                    )Balance
      December 31, 2004
                    
                    
                    17,860,026
                    
                    
                    17,900
                    
                    
                    5,591,300
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (6,422,800
                    )
                    
                    (813,600
                    )Common
      shares issued for cash
                    
                    
                    762,500
                    
                    
                    800
                    
                    
                    152,700
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    153,500Common
      shares issued for exercise of warrants
                    
                    
                    349,545
                    
                    
                    300
                    
                    
                    69,500
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    69,800Net
      loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (421,800
                    )
                    
                    (421,800
                    )Balance
      December 31, 2005
                    
                    
                    18,972,071
                    
                    
                    19,000
                    
                    
                    5,813,500
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (6,844,600
                    )
                    
                    (1,012,100
                    )Common
      shares issued for cash
                    
                    
                    2,448,213
                    
                    
                    2,400
                    
                    
                    642,100
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    644,500Common
      warrants exercised for cash
                    
                    
                    174,000
                    
                    
                    200
                    
                    
                    43,300
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    43,500Common
      shares issued for services
                    
                    
                    19,500
                    
                    
                    -
                    
                    
                    5,000
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    5,000Common
      shares issued in satisfaction of accountspayable
      and accrued liabilities
                    
                    
                    385,714
                    
                    
                    400
                    
                    
                    80,600
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    81,000Common
      shares issued in satisfaction of notespayable-related
      parties
                    
                    
                    56,821
                    
                    
                    100
                    
                    
                    11,800
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    11,900Common
      shares issued in satisfaction of convertibledebenture,
      (including accrued interest of $1,895)
                    
                    
                    206,767
                    
                    
                    200
                    
                    
                    41,700
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    41,900Common
      shares issued for asset acquisition
                    
                    
                    1,000,000
                    
                    
                    1,000
                    
                    
                    399,000
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    400,000Option
      granted to officers and directors
                    
                    
                    -
                    
                    
                    -
                    
                    
                    123,500
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    123,500Warrants
      granted for services
                    
                    
                    -
                    
                    
                    -
                    
                    
                    2,200
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    2,200Warrants
      granted in satisfaction of accountspayable
      and accrued liabilities
                    
                    
                    -
                    
                    
                    -
                    
                    
                    65,400
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    65,400Warrants
      granted in satisfaction of notespayable-related
      parties
                    
                    
                    -
                    
                    
                    -
                    
                    
                    9,600
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    9,600Warrants
      granted in satisfaction of convertibledebenture
                    
                    
                    -
                    
                    
                    -
                    
                    
                    40,000
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    40,000Net
      loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (621,000
                    )
                    
                    (621,000
                    )Balance
      December 31, 2006
                    
                    
                    23,263,086
                    
                    
                    23,264
                    
                    
                    7,277,736
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (7,465,600
                    )
                    
                    (164,600
                    )Common
      shares issued for cash
                    
                    
                    492,795
                    
                    
                    492
                    
                    
                    188,698
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    189,190Common
      warrants exercised for cash
                    
                    
                    745,372
                    
                    
                    745
                    
                    
                    185,598
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    186,343Common
      shares issued for services
                    
                    
                    4,000
                    
                    
                    4
                    
                    
                    2,010
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    2,014Common
      shares issued in satisfaction ofaccrued
      wages of $22,000, related party
                    
                    
                    50,000
                    
                    
                    50
                    
                    
                    21,950
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    22,000Debt
      forgiveness, related party
                    
                    
                    -
                    
                    
                    -
                    
                    
                    147,419
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    147,419Net
      loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (604,913
                    )
                    
                    (604,913
                    )Balance
      December 31, 2007
                    
                    
                    24,555,253
                    
                    
                    24,555
                    
                    
                    7,823,411
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (8,070,513
                    )
                    
                    (222,547
                    )Common
      shares issued for cash
                    
                    
                    32,500
                    
                    
                    33
                    
                    
                    8,092
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    8,124Net
      loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (112,679
                    )
                    
                    (112,679
                    )Balance,
      March 31, 2008
                    
                    
                    24,587,753
                    
                    
                    24,588
                    
                    
                    7,831,503
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (8,183,192
                    )
                    
                    (327,102
                    )Net
      loss
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    
                    (137,409
                    )Balance,
      June 30, 2008
                    
                    
                    24,587,753
                    
                    $
                    24,588
                    
                    $
                    7,831,503
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    (8,320,601
                    )
                    $
                    (327,102
                    )
  See
Accompanying Notes to Financial Statements
 6
 Can-Cal Resources
      Ltd.(An Exploration Stage
      Company)Condensed Statements of Cash
      Flows(Unaudited)
  For
      the Six Months Ended
                          June
      30,
                    
                    March
      22, 1995
                            (Inception)
                            to
      June 30,2008
                    
                    2007
                    
                    2008Cash
      flows from operating activities:Net
      loss
                    
                    $
                    (250,088
                    )
                    $
                    (286,738
                    )
                    $
                    (8,320,601
                    )Adjustments
      to reconcile net loss to netcash
      used by operating activities:Depreciation
      and amortization
                    
                    
                    5,995
                    
                    
                    6,021
                    
                    
                    243,320Bad
      debts
                    
                    
                    -
                    
                    
                    -
                    
                    
                    207,100(Gain)
      loss on sale of fixed assets
                    
                    
                    -
                    
                    
                    (3,701
                    )
                    
                    (6,501
                    )Stock
      based compensation
                    
                    
                    -
                    
                    
                    24,000
                    
                    
                    532,814Stock
      issued for financing and interest
                    
                    
                    -
                    
                    
                    -
                    
                    
                    523,200Beneficial
      conversion feature on convertible debts
                    
                    
                    -
                    
                    
                    -
                    
                    
                    25,200Loss
      on disposal of investment property
                    
                    
                    -
                    
                    
                    -
                    
                    
                    938,600Undistributed
      earnings of affiliate
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (174,300
                    )Gain
      on discontinued operations
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (116,400
                    )Loss
      on foreign currency translation
                    
                    
                    -
                    
                    
                    -
                    
                    
                    8,500Decrease
      (increase) in assets:Accounts
      receivable
                    
                    
                    -
                    
                    
                    3,600
                    
                    
                    -Other
      current assets
                    
                    
                    (5,100
                    )
                    
                    -
                    
                    
                    (95,800
                    )Other
      assets
                    
                    
                    -
                    
                    
                    (34
                    )
                    
                    (1,895
                    )Increase
      (decrease) in liabilities:Accounts
      payable
                    
                    
                    (4,531
                    )
                    
                    (11,570
                    )
                    
                    23,868Accrued
      interest
                    
                    
                    28,071
                    
                    
                    24,231
                    
                    
                    339,391Accrued
      officer salary
                    
                    
                    49,497
                    
                    
                    (51,256
                    )
                    
                    160,149Accrued
      payroll taxes
                    
                    
                    (21,395
                    )
                    
                    -
                    
                    
                    458Unearned
      revenues
                    
                    
                    37,686
                    
                    
                    11,225
                    
                    
                    47,061Net
      cash used by operating activities
                    
                    
                    (159,865
                    )
                    
                    (284,222
                    )
                    
                    (5,665,836
                    )Cash
      flows from investing activities:Purchase
      of investment property
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (1,083,600
                    )Proceeds
      from sale of investment property
                    
                    
                    -
                    
                    
                    -
                    
                    
                    319,300Purchase
      of property, equipment and mineral interests
                    
                    
                    -
                    
                    
                    (51,788
                    )
                    
                    (768,644
                    )Proceeds
      from sale of property, equipment and mineral interests
                    
                    
                    -
                    
                    
                    7,000
                    
                    
                    26,100Net
      cash used in investing activities
                    
                    
                    -
                    
                    
                    (44,788
                    )
                    
                    (1,506,844
                    )Cash
      flows from financing activities:Proceeds
      from notes payable
                    
                    
                    83,500
                    
                    
                    -
                    
                    
                    773,400Principal
      payments on notes payable
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (689,900
                    )Proceeds
      from notes payable, related parties
                    
                    
                    40,000
                    
                    
                    -
                    
                    
                    727,800Principal
      payments on notes payable, related parties
                    
                    
                    (4,920
                    )
                    
                    (23,116
                    )
                    
                    (332,170
                    )Proceeds
      from issuance of common stock
                    
                    
                    8,125
                    
                    
                    292,145
                    
                    
                    6,766,377Net
      cash provided by financing activities
                    
                    
                    126,705
                    
                    
                    269,029
                    
                    
                    7,245,507Net
      increase (decrease) in cash
                    
                    
                    (33,160
                    )
                    
                    (59,981
                    )
                    
                    72,827Cash,
      beginning of period
                    
                    
                    105,987
                    
                    
                    419,700
                    
                    
                    -Cash,
      end of period
                    
                    $
                    72,827
                    
                    $
                    359,719
                    
                    $
                    72,827Supplemental
      disclosure of cash flow information:Cash
      paid for income taxes
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    -Cash
      paid for interest
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    -
  See
Accompanying Notes to Financial Statements
 7
  CAN-CAL
RESOURCES LTD
 (An Exploration Stage Company)
 NOTES TO
FINANCIAL STATEMENTS
 (UNAUDITED)
  1.
              BASIS OF
      PRESENTATION
 
 The
accompanying unaudited condensed financial statements have been prepared in
accordance with Securities and Exchange Commission requirements for interim
financial statements. Therefore, they do not include all of the information and
footnotes required by accounting principles generally accepted in the United
States for complete financial statements. The financial statements should be
read in conjunction with the Form 10-KSB for the year ended December 31, 2007 of
Can-Cal Resources Ltd (“the Company”).
 
 The
interim condensed financial statements present the balance sheets, statements of
operations, and cash flows of Can-Cal Resources Ltd. The financial statements
have been prepared in accordance with accounting principles generally accepted
in the United States.
 
 The
interim financial information is unaudited. In the opinion of management, all
adjustments (which include normal recurring adjustments) necessary to present
fairly the financial position as of June 30, 2008 and the results of operations
and cash flows presented herein have been included in the financial statements.
Interim results are not necessarily indicative of results of operations for the
full year.
 
 The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States 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. Actual results could differ from those estimates.
 
 Certain
amounts in the prior periods presented have been reclassified to conform to the
current period financial statement presentation.
 
 Exploration
Stage Company
  The
Company is currently an exploration stage company. As an exploration stage
enterprise, the Company discloses the deficit accumulated during the exploration
stage and the cumulative statements of operations and cash flows from inception
to the current balance sheet date. The Company has incurred net losses of
$8,320,601 and used net cash in operations of $5,665,836 for the period from
inception (March 22, 1995) through June 30, 2008. An entity remains in the
exploration stage until such time as proven or probable reserves have been
established for its deposits. Upon the location of commercially mineable
reserves, the Company plans to prepare for mineral extraction and enter the
development stage. To date, the exploration stage of the Company’s operations
consists of contracting with geologists to sample and assess the mining
viability of the Company’s claims.
  2.
              GOING
      CONCERN
 
 The
Company incurred a net loss of $250,088 for the six months ending June 30, 2008.
Also, the Company’s current liabilities exceed its current assets by $972,130 as
of June 30, 2008. These factors create substantial doubt about the Company’s
ability to continue as a going concern. The Company’s management plans to
continue to fund its operations in the short term with a combination of debt and
equity financing, as well as revenue from operations in the long
term.
 
 The
ability of the Company to continue as a going concern is dependent on additional
sources of capital and the success of the Company’s plan. The financial
statements do not include any adjustments that might be necessary if the Company
is unable to continue as a going concern.
 
 3.
              CORRECTION OF
      ERRORS
 
 The
Company has restated its previously issued June 30, 2007 financial statements
for matters related to the following previously reported items: a purchase of
mineral rights on a mining claim located in Mohave County, Arizona in exchange
for 1,000,000 shares of the Company’s common stock was incorrectly valued in the
prior year. The Company originally recorded an asset value of $18,500 based on
the actual costs to maintain the claim annually, however, in accordance with
SFAS 123(R) the purchase of the mineral rights should have been valued based on
the fair market value of the underlying shares of common stock exchanged which
amounted to $400,000 given the $0.40 closing stock price on the date of
purchase. The accompanying financial statements for the six month period ending
June 30, 2007 have been restated to reflect the corrections in accordance with
Statement of Accounting Standards Board No. 154, “Accounting Change and Error
Correction”. The following is a summary of the restatements for June 30,
2007:
  8
 CAN-CAL
RESOURCES LTD
 NOTES TO
FINANCIAL STATEMENTS
 (UNAUDITED)
 Increase
      of previously reported other assets:-
      unrecorded value of mineral rights acquired
              
              $
              381,500Increase
      of previously reported additional paid in capital:-
      unrecorded amount of additional paid in capital on stock
      issuance
              
              $
              381,500
  The
effect on the Company’s previously issued June 30, 2007 financial statements are
summarized as follows:
 
 Consolidated Balance Sheet as of
June 30, 2007
 
 Previously
      Reported
              
              Net
                Change
              
              RestatedAssetsCurrent
      assetsCash
              
              $
              359,719
              
              $
              -
              
              $
              359,719Total
      current assets
              
              
              359,719
              
              
              -
              
              
              359,719Fixed
      assets, net
              
              
              61,468
              
              
              -
              
              
              61,468Other
      assets, net
              
              
              49,134
              
              
              381,500
              
              
              430,634$
              470,321
              
              $
              381,500
              
              $
              851,821Current
      liabilitiesAccounts
      payable
              
              $
              22,630
              
              $
              -
              
              $
              22,630Accrued
      interest
              
              
              286,731
              
              
              -
              
              
              286,731Accrued
      officer salary
              
              
              127,010
              
              
              -
              
              
              127,010Accrued
      payroll taxes
              
              
              70,089
              
              
              -
              
              
              70,089Notes
      payable, related parties
              
              
              358,184
              
              
              -
              
              
              358,184Unearned
      revenues
              
              
              20,625
              
              
              -
              
              
              20,625Total
      current liabilities
              
              
              885,269
              
              
              -
              
              
              885,269Commitments
      and contingencies
              
              
              -
              
              
              -
              
              
              -Stockholders’
      deficitPreferred
      stock
              
              
              -
              
              
              -
              
              
              -Common
      stock
              
              
              24,276
              
              
              -
              
              
              24,276Additional
      paid-in capital
              
              
              7,313,114
              
              
              381,500
              
              
              7,694,614Accumulated
      deficit
              
              
              (7,752,338
              )
              
              -
              
              
              (7,752,338
              )Total
      stockholders’ deficit
              
              
              (414,948
              )
              
              381,500
              
              
              (33,448
              )$
              470,321
              
              $
              381,500
              
              $
              851,821
 
 Also, in
response to comments raised by the staff of the Securities and Exchange
Commission (“SEC”) concerning the presentation of the financial statements
included in our Annual Report on Form 10-KSB for the fiscal year ended December
31, 2007 and our Quarterly Reports on Form 10-QSB for the quarter ended March
31, 2008, coupled with our own internal investigation, and discussions with our
independent registered public accounting firm, we concluded on August 15, 2008
that the audited condensed financial statements included in our Annual Report
for the year ended December 31, 2007 and the unaudited condensed financial
statements included in our Quarterly Report on Form 10-QSB for the three months
ended March 31, 2008, (collectively referred to herein as the “Financial
Statements” ),
require restatement to correct the reporting of of mining transactions to be
consistent with SEC Industry Guide 7, Description of Property by Issuers
Engaged or to Be Engaged in Significant Mining Operations .
  9
 CAN-CAL
RESOURCES LTD
 NOTES TO
FINANCIAL STATEMENTS
 (UNAUDITED)
 Even
though the Financial Statements have discussed the Company as and “exploration
stage” company
the Financial Statements present the Company as a “production
stage” company
through the omission of inception to date financial disclosures. SEC Industry
Guide 7 defines a production stage company as one that has reserves that are
proven or probable as evidenced by a reserve report. As we have not proven
reserves, or began production as evidenced by our lack of significant revenues
from our principal activity of mining, we would be considered an “exploration
stage” company,
rather than a production stage company.
 
 To
present the Company as an exploration stage company we will restate the
Financial Statements to add a column disclosing “ inception to
date” amounts
to the statements of operations and statements of cash flows. All other
information was presented consistent with that of an exploration stage
company.
  4.
              NOTES PAYABLE, RELATED
      PARTIES
 
 Notes
payable, related parties consisted of the following as of June 30,
2008:
 Note
      payable to a stockholder, secured by real property, bearing interest at
      16.0% per annum, semi-annual interest only payments,
                      matured
      November 2005 (currently in default)
                
                $
                300,000Note
      payable to a stockholder, secured by real property,
bearinginterest
      at 8.0% per annum, matured February 2008 (currently in
      default)
                
                
                25,114Note
      payable to a stockholder, secured by real property,
bearinginterest
      at 8.0% per annum, matured January 2008 (currently in
    default)
                
                
                35,436Unsecured
      promissory notes payable, bearing interest at 8.0% per
    annum,and
      a default interest rate of 12.0% per annum, maturing May 7,
      2009
                
                
                15,080Unsecured
      promissory notes payable, bearing interest at 8.0% per
    annum,and
      a default interest rate of 12.0% per annum, maturing June 6,
      2009
                
                
                20,000Current
      portion (amounts due within one year)
                
                $
                395,630
  The
Company is in default of its semi-annual interest payments in the total amount
of $316,000 from 2002 through the present on a note payable of $300,000. The
Company is currently negotiating forbearance on collection of the principle and
interest. Interest expense was $29,264 and $28,887 for the six months ending
June 30, 2008 and 2007, respectively.
  5.
              NOTES
      PAYABLE
 
 Notes
payable consisted of the following as of June 30, 2008:
 Unsecured
      promissory note payable, bearing interest at 8.0% per
    annum,and
      a default interest rate of 12.0% per annum, maturing March 10,
      2009
                
                $
                22,000Unsecured
      promissory note payable, bearing interest at 8.0% per
    annum,and
      a default interest rate of 12.0% per annum, maturing April 7,
      2009
                
                
                7,500Unsecured
      promissory note payable, bearing interest at 8.0% per
    annum,and
      a default interest rate of 12.0% per annum, maturing March 10,
      2009
                
                
                12,000Unsecured
      promissory note payable, bearing interest at 8.0% per
    annum,and
      a default interest rate of 12.0% per annum, maturing June 2,
      2009
                
                
                12,000Unsecured
      promissory note payable, bearing interest at 8.0% per
    annum,and
      a default interest rate of 12.0% per annum, maturing June 6,
      2009
                
                
                30,000Current
      portion (amounts due within one year)
                
                $
                83,500
  10
 CAN-CAL
RESOURCES LTD
 NOTES TO
FINANCIAL STATEMENTS
 (UNAUDITED)
 6.
              CHANGES IN
      SECURITIES
 1996
 
 During
1996 the Company issued 3,441,217 shares of Can-Cal common stock to various
investors resulting in cash proceeds of $628,400.
  1997
 
 On
January 15, 1997 the Company issued 500,000 shares of Can-Cal common stock along
with a cash payment of $100,000 in exchange for a 50% interest in S&S Joint
Venture. Additionally, the Company agreed to loan the joint venture up to
$48,000.
 
 On
February 13, 1997 the Board approved the acquisition of Scotmar Industries, Inc.
200,000 shares of Can-Cal common stock were issued in return for all of the
issued and outstanding stock of the acquired company.
 
 On
October 27, 1997 the Board approved the issuance of 2,181,752 restricted common
shares to ARUM, LLC to repay an existing debt of approximately $315,045.98 and
to purchase a property located in San Bernadino County, California, known as the
Pisgah property.
 
 During
November, 1997 the Board approved the sale of 124,683 restricted common shares
to various investors.
 
 During
December, 1997 the Board approved the issuance of 42,000 restricted common
shares in return for services rendered.
  1998
 
 In July,
1998 the Board approved the issuance 122,000 restricted common shares to various
investors.
 
 In
October, 1998 the Board approved the sale of 172,450 restricted common shares to
various investors.
 
 During
December, 1998 the Board approved the sale of 263,059 restricted common shares
to various investors.
  1999
 
 On
February 1, 1999, the Board of Directors approved the Sale of 62,500 shares of
Can-Cal common stock to a Board member.
 
 On
February 8, 1999 the Board approved the sale of 70,000 shares of Can-Cal common
stock to a Board member.
 
 On March
1, 1999 the Board approved the issuance of 32,121 shares of Can-Cal common stock
in return for services rendered.
 
 On March
15, 1999 the Board approved the sale of 86,000 shares of Can-Cal common stock to
various investors.
 
 On March
17, 1999 the Board approved the issuance of 40,000 shares of Can-Cal common
stock in return for equipment.
 
 On March
10, 1999 the Board approved the sale of 295,500 shares of Can-Cal common stock
to various investors.
 
 11
  On April
1, 1999 the Board approved the sale of 1,000 restricted common stock in return
for equipment.
 
 On July
21, 1999 the Board approved the sale of 357,500 shares of common stock to
various investors.
 
 On August
24, 1999 the Board approved the sale of 274,000 shares of common stock to
various investors.
 
 On
September 7, 1999 the Board approved the sale of 20,000 shares of common stock
to an investor.
 
 On
November 9, 1999 the board approved the issuance of 10,000 shares of common
stock to an investor.
  2000
 
 On
February 27, 2000, the Board of Directors approved the sale of 500,000 shares of
common stock to three of its directors (all of whom reside in Canada), an
offshore trust and another person affiliated with the Company.
 
 On July
3, 2000, the Board of Directors exercised the option to acquire technology
related to the extraction and processing of ore and, in accordance with the
agreement with the two owners of that technology, issued 200,000 shares of
Can-Cal's common stock to them.
 
 On
November 24, 2000, the Company borrowed $300,000 from a lender. As part of the
transaction, the Company issued 45,000 shares of its common stock as a loan
placement fee and granted the lender an option to purchase up to 300,000 shares
of its common stock. On November 24, 2000, the lender exercised its option in
full and purchased 300,000 shares of Can-Cal's common stock.
 
 In July
2000 the Board of Directors authorized the sale of 74,009 shares of its common
stock to eight persons, all of whom reside outside the United States. During the
third quarter 46,670 shares were sold and the remaining 27,339 shares were sold
during the fourth quarter. All of those shares were issued on December 15,
2000.
  2001
 
 In
September, 2001, the Board of Directors authorized the sale of 20,000 shares of
its common stock to an individual.
 
 During
October, 2001 the company signed an Investment Agreement with two funds
(Dutchess Private Equities Fund LP and DRH Investment Company LLC) to sell to
those funds up to $8,000,000 in common stock of the company, for a period of
three years. In connection with the Investment Agreement, the company issued
606,059 shares of restricted common stock to Dutchess Fund and its advisor, and
to a broker-dealer firm, for services valued at $400,000, to induce those
entities to enter into the Investment Agreement and perform services
contemplated under such agreement. The company also issued 37,000 shares of
restricted common stock to the attorney for Dutchess Fund.
 
 On
November 2, 2001 the Board of Directors approved the sale of 82,888 shares of
restricted common stock.
 
 On
December 12, 2001 the Board of Directors approved the sale of 40,000 shares of
restricted common stock.
 
 12
 
 2002
 
 On
January 8, 2002, we sold 36,000 restricted common shares to three investors (one
Canadian resident, and two private companies controlled and owned by Canadian
residents) for $12,600 cash ($0.35 per share, representing a discount of
approximately 50% from market price). These investors also were issued warrants
to purchase 36,000 additional restricted shares, at a price of $0.35 per share;
the warrants will expire January 8, 2004.
 
 On
February 11, 2002, 10,000 restricted common shares were sold to one investor (a
Canadian resident) for $3,500 cash ($0.35 per share, representing a discount of
approximately 50% from market price). This investor also was issued warrants to
purchase 10,000 additional restricted shares, at a price of $0.35 per share; the
warrants will expire February 11, 2004. Complete information about the company
was provided to these investors. These shares and warrants were sold pursuant to
the exemption provided by Regulation S of the 1933 Act. No commissions were
paid.
 
 On
January 31, 2002, we issued 309,677 restricted common shares to a lender (First
Colony Merchant) for payment of past due and current interest on debt, $119,800.
No commissions were paid.
 
 From
March 1, 2002 through June 3, 2002, 369,600 restricted common shares were issued
to 48 investors (all Canadian residents or companies controlled and owned by
Canadian residents) for $92,400 cash ($0.25 per share, representing discounts
ranging from 0% to approximately 50% from market prices at the time of
issuance). These investors also were issued warrants to purchase 369,600
additional restricted shares, at a price of $0.25 per share; the warrants will
expire two years from the date of issuance. No commissions were
paid.
 
 On June
21, 2002, 40,000 restricted common shares were issued to Financial
Communications Corp. for public relations services, valued at approximately
$14,000.
 
 From July
1, 2002 through December 24, 2002, 609,720 restricted common shares were issued
to 20 investors (19 whom are Canadian residents or companies controlled and
owned by Canadian residents, and one who is a resident of Great Britain) for
$152,400 cash ($0.25 per share, representing prices that ranged from 22% over
market to approximately 40% below market prices at the time of issuance). The
investors also were issued warrants to purchase a total of 609,720 additional
restricted shares, at a price of $0.25 per share; the warrants will expire two
years from the date of issuance. No commissions were paid.
 
 During
September 2002, the Company issued 32,281 shares of the Company's common stock
for $5,500 in cash related to the Dutchess Private Equities Fund, net of
offering costs of $200, and issued 30,000 shares to Joseph B. LaRocco, attorney
for Dutchess Fund and DRH Investment Company, LLC for legal services to such
entities.
 
 During
October 2002, the Company issued 35,679 shares of the Company's common stock for
$4,600 in cash related to the Dutchess Private Equities Fund, net of offering
costs of $700.
 
 In
November 2002, the Company issued 52,292 restricted common shares to four
individuals in exchange for various services, valued at approximately
$9,900.
  2003
 
 During
2003, 673,410 restricted common shares were issued to 19 Canadian residents or
companies controlled and owned by Canadian resident investors for $134,682 and
150,000 restricted common shares were issued to 12 U.S. resident investors for
$30,000 (all shares were priced at $0.20 per share, representing premiums of up
to 25% and discounts ranging from 0% to approximately 25% from market prices at
the time of issuance). With respect to 237,410 restricted common shares, the
investors were also issued warrants to purchase 474,820 additional restricted
common shares and with respect to 473,500 restricted common shares, the
investors were also issued warrants to purchase 473,500 additional restricted
common shares; all warrants were priced at $0.20 per share and will expire two
years from the date of issuance. With respect to 112,500 restricted common
shares, the investors were also issued 112,500 warrants to purchase additional
restricted common shares, at a price of $0.25 per share for a period of two
years from the date of issuance. The shares and warrants were sold to Canadian
investors pursuant to the exemption provided by Regulation S of the 1933 Act,
and the shares and warrants sold to U.S. investors were sold pursuant to the
exemption provided by section 4(2) of the 1933 Act.
 
 13
  During
2003, 364,305 restricted common shares were issued in conversion of $35,000
principal and interest on a debenture held by Dutchess Fund. The conversion
prices were $0.099 for 50,710 shares ($5,000 of the debenture); $0.112 for
44,643 shares ($5,000 of the debenture); $0.061 for 81,433 shares ($5,000 of the
debenture); $0.067 for 75,075 shares ($5,000 of the debenture); and $0.1334 for
112,444 shares ($15,000 of the debenture). All of the prices were determined by
the conversion formula in the debenture (80% of the average bid prices for the
three lowest (out of 15) trading days before conversion. These shares were sold
pursuant to the exemption provided by section 4(2) of the 1933 Act.
 
 During
2003, 205,166 restricted common shares in payment of $31,500 of services by Luis
Vega, consulting geologist. The per share price was determined by dividing the
amount owed by the average closing price of the company's stock for each day's
service. These shares were sold pursuant to the exemption provided by section
4(2) of the 1933 Act.
 
 On March
14, 2003, 24,960 restricted common shares were issued to Catherine Nichols, a
Canadian resident, for marketing services amounting to $5,000. The price per
share was based on the average closing share price for the period during which
the services were rendered. These shares were sold pursuant to the exemption
provided by Regulation S of the 1933 Act.
 
 During
the period from July 15 to December 31, 2003, 112,326 restricted common shares
in payment of $22,250 of investor relations services by Jeffrey Whitford, a
Canadian resident who is a consultant to the company. The price per share was
based on the average monthly closing share prices for the period. These shares
were sold pursuant to the exemption provided by Regulation S of the 1933
Act.
 
 33,600
restricted common shares were issued to pay $4,200 of legal services provided by
Stephen E. Rounds, outside company counsel. The price per share was based on the
average closing share price for the period during which the services were
rendered. These shares were sold pursuant to the exemption provided by section
4(2) of the 1933 Act.
 
 On
December 30, 2003, 5,208 restricted common shares were issued to Terry Brown, a
Mexican resident, for technical consulting services amounting to $1,250. The
price per share was based on the average closing share price for the period
during which the services were rendered. These shares were sold pursuant to the
exemption provided by Regulation S of the 1933 Act.
  2004
 
 During
2004, 2,255,586 restricted common shares were issued to 107 Canadian residents
or companies controlled and owned by Canadian resident investors for $431,425
and 10,000 restricted common shares were issued to one U.S. resident investor
for $2,000 (245,000 shares were priced at $0.18 per share, 1,620,131 shares were
priced at $0.20 per share, 261,200 shares were priced at $0.25 per share, and
139,255 shares were issued as a 25% premium on the conversion of warrants,
representing premiums of up to 25% and discounts ranging from 0% to
approximately 25% from market prices at the time of issuance). With respect to
1,319,308 of these restricted common shares, the investors were also issued
warrants to purchase 1,259,308 additional restricted common shares at $0.25 per
share and 60,000 additional restricted common shares at $0.20 per share. With
respect to 245,000 restricted common shares, the investors were also issued
warrants to purchase 245,000 additional restricted common shares at $0.25, and
with respect to another 245,000 restricted common shares, the investors were
also issued warrants to purchase 245,000 additional restricted common shares at
$0.50 per share. Of these, we also sold 5,000 shares to a director of the
Company for proceeds of $1,000 and issued warrants to purchase 5,000 restricted
common shares, exercisable at $0.25 per share for a two year period. All
warrants will expire two years from the date of issuance. The shares and
warrants were sold to Canadian investors pursuant to the exemption provided by
Regulation S of the 1933 Act, and the shares and warrants sold to U.S. investors
were sold pursuant to the exemption provided by section 4(2) of the 1933
Act.
 
 14
  During
2004, 702,760 restricted common shares were issued in conversion of $99,657
principal and interest on a debenture held by Dutchess Fund. The conversion
prices were $0.216 for 92,593 shares ($20,000 of the debenture); $0.160 for
31,250 shares ($5,000 of the debenture); $0.144 for 34,722 shares ($5,000 of the
debenture); $0.128 for 544,195 shares ($69,657 of the debenture). All of the
prices were determined by the conversion formula in the debenture (80% of the
average bid prices for the three lowest (out of 15) trading days before
conversion). These shares were sold pursuant to the exemption provided by
section 4(2) of the 1933 Act.
 
 During
2004, 215,336 restricted common shares were issued in payment of $40,932 of
services by Luis Vega, consulting geologist. The price per share was determined
by dividing the amount owed by the average closing price of the company's stock
for each day's service. These shares were sold pursuant to the exemption
provided by section 4(2) of the 1933 Act.
 
 On
February 4, 2004, 10,000 restricted common shares were issued to Yvonne St.
Pierre, a Canadian resident, for computer-related services, in the amount of
$2,500. These shares were issued pursuant to the exemption provided by
Regulation S of the 1933 Act.
 
 Between
February 10 and March 31, 2004, 75,000 restricted common shares were issued to
Jeff Whitford, a Canadian resident, for investor relation services, in the
amount of $15,000. In addition, Mr. Whitford received 50,000 warrants at an
exercise price of $0.20 per share; the warrants will expire between February
2006 and March 2006. The warrants were valued at $12,200 utilizing the Black
Scholes model. These shares were issued pursuant to the exemption provided by
Regulation S of the 1933 Act.
 
 On
December 22, 2004, 2,500 restricted common shares were issued to Karen Barra, a
U.S. resident, for services amounting to $500. The price per share was $0.20
based on private placement offering for the period during which the services
were rendered. These shares were sold pursuant to the exemption provided by
Regulation S of the 1933 Act.
 
 During
2004, 15,367 restricted common shares were issued in payment of accounts payable
amounting to $3,842. The price per share was based on the average closing share
price for the period during which the services were rendered. These shares were
sold pursuant to the exemption provided by Regulation S of the 1933
Act.
 
 During
2004, 87,388 restricted common shares were issued to Terry Brown, a Mexican
resident, for technical consulting services amounting to $15,247. The price per
share was based on the average closing share price for the period during which
the services were rendered. These shares were sold pursuant to the exemption
provided by Regulation S of the 1933 Act.
 
 On March
1, 2004, in connection with the conversion of $82,687 in notes payable and
$225,595 in accrued officers' salary payable, we issued 1,233,127 restricted
common shares at $0.25 per share and 1,233,127 warrants, with an exercise price
of $0.30 and expiring on March 1, 2006, to two officers, two directors, and a
former director and his insurance agency. These persons and the insurance agency
are accredited investors.
  2005
 
 During
the twelve months ended December 31, 2005, we sold 712,500 restricted common
shares to 21 Canadian residents for a total of $142,500, and issued warrants to
purchase 712,500 restricted common shares, exercisable at $0.25 per share. These
securities were issued in private transactions in reliance on the exemption from
registration with the SEC provided by Regulation S.
 
 15
  A prior
U.S. shareholder exercised other warrants, at exercise prices ranging from
$0.22, for proceeds of $11,000, which resulted in the issuance of 50,000
restricted common shares. These securities were issued in private transactions
in reliance on the exemption available under Section 4(2) of the 1933
Act.
 
 We also
issued, for services, 349,545 restricted common shares for a total value of
$69,800 valued at fair market value at date of issuance and granted 13,575
warrants (exercisable for two years at $0.25 per share) valued at fair market
value at date of issuance. These securities were issued to two Canadian
residents, and one Mexican Corporation in reliance on the exemption from
registration available under Regulation S, and one U.S. resident, in reliance on
the exemption provided by Section 4(2) of the 1933 Act.
  2006
 
 During
the twelve months ended December 31, 2006, we sold 2,622,213 restricted common
shares to 76 Canadian residents, 8 US residents, 5 Israeli Nationals and 1 Swiss
National for a total of $688,000, and issued warrants to purchase 2,348,213
restricted common shares, exercisable between $0.25 to $.45 per share. These
securities were issued in private transactions, with respect to the Canadian
residents, in reliance on the exemption from registration with the SEC provided
by Regulation S, and with respect to the U.S. citizen, in reliance on the
exemption available under Section 4(2) of the 1933 Act.
 
 We also
issued, for services, 8,500 restricted common shares for a total value of $2,325
and these securities were issued to one U.S. resident in reliance on the
exemption provided by Section 4(2) of the 1933 Act.
 
 On July
3, 2006, the Company issued 2,200 shares of its par value common stock for
services received by an individual. As of September 30, 2006, the Company
recorded consulting expense in the amount of $462, the fair value of the shares
issued on the date of grant. Additionally, the Company granted a warrant to
purchase 2,200 shares of the Company's common stock at an exercise price of
$0.25 for a period of 2 years. The Company recorded an expense in the amount of
$373, the fair value of the warrant on the date of grant. Fair value was
determined using the Black Scholes option pricing model based on the following
assumptions: expected dividends: $-0-; volatility: 187%; risk free interest
rate: 5.12%.
 
 On July
3, 2006, the Company issued 8,800 shares of its par value common stock for
services received from an individual. As of September 30, 2006, the Company
recorded consulting expense in the amount of $2,200, the fair value of the
shares issued on the date of grant. Additionally, the Company granted a warrant
to purchase up to 8,800 shares of the Company's common stock at an exercise
price of $0.25 for a period of 2 years. The Company recorded an expense in the
amount of $1,812, the fair value of the warrant on the date of grant. Fair value
was determined using the Black Scholes option pricing model based on the
following assumptions: expected dividends: $-0-; volatility: 187%; risk free
interest rate: 5.12%.
 
 On July
3, 2006, an officer of the Company elected to convert half of his accrued salary
in exchange for 385,714 shares of common stock valued at $81,000, the fair value
of the shares issued on the date of grant. Additionally, the Company granted a
warrant to purchase up to 385,714 shares of the Company's common stock at an
exercise price of $0.25 for a period of two years. The Company recorded an
expense in the amount of $65,418, the fair value of the warrant on the date of
grant. Fair value was determined using the Black Scholes option pricing model
based on the following assumptions: expected dividends: $-0-; volatility: 187%;
risk free interest rate: 5.12%.
 
 On July
3, 2006, the Company issued 56,821 shares of its common stock for conversion of
a note in the amount of $11,932 from a shareholder of the Company. Additionally,
the Company granted a warrant to purchase up to 56,821 shares of the Company's
common stock at an exercise price of $0.25 for a period of two years. The
Company recorded an expense in the amount of $9,637, the fair value of the
warrant on the date of grant. Fair value was determined using the Black Scholes
option pricing model based on the following assumptions: expected dividends:
$-0-; volatility: 187%; risk free interest rate: 5.12%.
 
 On July
11, 2006, the Company issued 206,767 shares of its par value common stock
pursuant to the convertible debenture agreement entered into on January 24, 2006
whereby the Company received a $40,000 convertible at a rate of $0.20 per share
bearing interest of 10% per annum. The note holder elected to convert all
accrued interest totaling $1,895 into 6,767 shares of the Company's par value
common stock.
 
 16
  On August
22, 2006, the Company entered into an agreement to purchase mining claims
located in Mohave County, Arizona in exchange for 1,000,000 shares of the
Company's par value common stock. The Company recorded an asset totaling
$400,000, the fair value of the underlying shares.
  2007
 
 During
the twelve months ended December 31, 2007, we sold 1,238,167 restricted common
shares to 72 Canadian residents and 4 US residents for a total of $375,534 and
issued warrants to purchase 492,795 restricted common shares, exercisable
between $0.35 to $.65 per share. These securities were issued in private
transactions, with respect to the Canadian residents, in reliance on the
exemption from registration with the SEC provided by Regulation S, and with
respect to the U.S. citizen, in reliance on the exemption available under
Section 4(2) of the 1933 Act.
 
 On April
30, 2007, the Company also issued 50,000 shares of restricted common stock as
part of a settlement agreement with a former officer of the Company for
compensation of accrued salaries. The common stock was rendered to a U.S.
citizen, in reliance on the exemption available under Section 4(2) of the 1933
Act. The shares were valued at a total of $22,000. In addition to monthly cash
payments of $3,500 per month the Company has recorded debt forgiveness of
$147,419 in accordance with the terms of the settlement agreement. Due to the
related party nature of the transaction the gain has been recorded to additional
paid in capital, therefore there has been no impact on the Company’s net
loss.
 
 On June
29, 2007, the Company also issued 4,000 shares of restricted common stock for
services rendered to a U.S. citizen, in reliance on the exemption available
under Section 4(2) of the 1933 Act. The shares were valued at a total of
$2,000.
  2008
 During
the three months ending March 31, 2008, the Company sold 32,500 restricted
shares of common stock along with warrants to purchase an additional 32,500
shares of the Company’s common stock to various accredited Canadian and US
citizens for total proceeds of $8,125. The warrants were fully vested, are
exercisable at $0.35 per share, and expire two years from the date of issuance.
These securities were issued in private transactions, with respect to the
Canadian resident, in reliance on the exemption from registration with the SEC
provided by Regulation S, and with respect to the U.S. citizen, in reliance on
the exemption available under Section 4(2) of the 1933 Act.
 
 Previously
issued warrants to purchase 431,000 shares of the Company’s common stock expired
during the six months ending, June 30, 2008.
 
 7.
              COMMITMENTS AND
      CONTINGENCIES
 
 Operating
lease - The Company operates from a leased facility in Nevada under a month to
month basis. The lease calls for monthly base rent of approximately $1,500.
  8.
              SUBSEQUENT
      EVENTS
 
 During
July of 2008 the Company received a total of $175,000 from three of the
Company’s shareholders. The unsecured promissory notes bear interest at 8% and
matures at various dates in June and July of 2009 .
  17




ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS




(a)  Plan of
Operation.




Can-Cal
Resources Ltd. is a public company engaged in seeking the acquisition and
exploration of metals mineral properties. As part of its growth strategy, the
Company will focus its future activities in the USA, with an emphasis on the
Pisgah Mountain, California property and the Wikieup, Arizona property.




The
Company has discontinued all industrial sales for the volcanic materials located
on the Pisgah property in California subject to the finalization of the current
analytical program.





At May
19, 2008, we had approximately $30,209 cash available to sustain operations.
Accordingly we are uncertain as to whether the Company may continue as a going
concern. While we may seek additional investment capital, or possible funding or
joint venture arrangements with other mining companies, we have no assurance
that that such investment capital or additional funding and joint venture
arrangements will be available to the Company.




(b)  Results of Operations for the Three
Months Ended June 30, 2008 and 2007.





The
following table summarizes selected items from the statement of operations for
the three months ended June 30, 2008 compared to June 30, 2007.




EXPENSES:




Three
      Months Ended
              June
      30,2008
            
            2007
            
            Increase
      / (Decrease)Amount
            
            Amount
            
            $
            
            %Expenses:Exploration costs
            
            $
            20,991
            
            $
            55,635
            
            $
            (34,644
            )
            
            (62
            %)Depreciation
            
            
            2,998
            
            
            3,816
            
            
            (818
            )
            
            (21
            %)General
      & administrative expenses
            
            
            85,645
            
            
            58,251
            
            
            27,394
            
            
            47
            %Officer
      compensation
            
            
            29,008
            
            
            32,886
            
            
            (3,878
            )
            
            (12
            %)Total operating expenses
            
            
            138,642
            
            
            150,588
            
            
            (11,946
            )
            
            (8
            %)Loss
      from operations
            
            
            (138,642
            )
            
            (150,588
            )
            
            (11,946
            )
            
            (8
            %)Other
      income (expense):Interest
      income
            
            
            4
            
            
            3,505
            
            
            (3,501
            )
            
            (100
            %)Rental
      revenue
            
            
            16,689
            
            
            5,625
            
            
            11,064
            
            
            197
            %Loss
      on sale of equipment
            
            
            -
            
            
            3,701
            
            
            (3,701
            )
            
            (100
            %)Interest
      expense
            
            
            (15,460
            )
            
            (14,307
            )
            
            (1,153
            )
            
            (8
            %)Total other income (expense)
            
            
            1,233
            
            
            (1,476
            )
            
            2,709
            
            
            184
            %Net
      loss
            
            $
            (137,409
            )
            $
            (152,064
            )
            $
            (14,655
            )
            
            (10
            %)







18




Exploration costs





Exploration
costs for the three months ended June 30, 2008 decreased by $34,644 or 62% from
$55,635 for the three months ended June 30, 2007 to $20,991 for the three months
ended June 30, 2008. The decrease is due to our efforts to scale back on further
research as a result of the Cease Trade Order issued by the British Columbia
Securities Commission and therefore causing the inability to provide Private
Placement funding necessary to maintain operations.


Unless
the Company is able to establish the economic viability of its mining
properties, the Company will continue writing off its expenses of exploration
and testing of its properties. Therefore, losses will continue unless the
Company sells one or more of its properties or locates and delineates reserves
and initiates mining operations. If that occurs, the Company may capitalize
certain of those expenses.





The
Company has no material commitments for capital expenditures other than
expenditures it chooses to make with respect to testing and or exploration of
its mineral properties.





Depreciation





Depreciation
for the three months ended June 30, 2008 decreased by $818 or 21% from $3,816
for the three months ended June 30, 2008 to $2,998 for the three months ended
June 30, 2008. The decrease is principally due to less equipment on hand to
depreciate after the sale of equipment towards the end of the three month period
ending June 30, 2007.





General and administrative
expenses





General
and administrative expenses for the three months ended June 30, 2008 increased
by $27,394 or 47% from $58,251 for the three months ended June 30, 2007 to
$85,645 for the three months ended June 30, 2008. The increase is principally
due to increased costs to maintain the office, including increased utility costs
and payroll and payroll taxes associated with moving some of the administrative
functions in house.




19





Officer
compensation





Officer
compensation for the three months ended June 30, 2008 decreased by $3,878 or 12%
from $32,886 for the three months ended June 30, 2007 to $29,008 for the three
months ended June 30, 2008.





Total operating
expenses





Total
operating expenses for the three months ended June 30, 2008 decreased by $11,946
or 8% from $150,588 for the three months ended June 30, 2007 to $138,642 for the
three months ended June 30, 2008. The decrease in total operating expenses was
mainly a result of management’s efforts to scale back exploration costs until
the Company has the resources to effectively explore the claims that have been
obtained.





Other income (expense)





Interest
income for the three months ended June 30, 2008 decreased by $3,501 or 100% from
$3,505 for the three months ended June 30, 2007 to $4 for the three months ended
June 30, 2008. Interest income relates to interest earned on cash received as a
result of financing activities, of which less was on hand during the three
months ended June 30, 2008 compared to the same period in 2007.





Rental
revenue for the three months ended June 30, 2008 increased by $11,064 or 197%
from $5,625 for the three months ended June 30, 2007 to $16,689 for the three
months ended June 30, 2008. Rental revenue relates to income derived from the
rental of the Company’s land for the purposes of filming movies or photo shoots.
More photo shoots, including a television commercial, were performed during the
three months ended June 30, 2008 compared to the same period in 2007.





Interest
expense for the three months ended June 30, 2008 increased by $1,153 or 8% from
$14,307 for the three months ended June 30, 2007 compared to $15,460 for the
three months ended June 30, 2008.





Net loss





Our net
loss was $137,409 for the three months ended June 30, 2008 compared to a net
loss of $152,064 for the three months ended June 30, 2007. We expect to improve
our results of operations through the attainment of sufficient working capital
and a focus on generating revenues from the subcontracting of mining activities,
and a reduction of general and administrative expenses.





(c)  Results
of Operations for the Six Months Ended June 30, 2008 and 2007.





The
following table summarizes selected items from the statement of operations for
the six months ended June 30, 2008 compared to June 30, 2007.





20




EXPENSES:
  Six
      Months Ended
                June
      30,2008
              
              2007
              
              Increase
      / (Decrease)Amount
              
              Amount
              
              $
              
              %Expenses:Exploration costs
              
              $
              38,905
              
              $
              102,943
              
              $
              (64,038
              )
              
              (62
              %)Depreciation
              
              
              5,995
              
              
              6,021
              
              
              (26
              )
              
              -
              %General
      & administrative expenses
              
              
              142,640
              
              
              106,745
              
              
              35,895
              
              
              34
              %Officer
      compensation
              
              
              60,000
              
              
              64,052
              
              
              (4,052
              )
              
              (6
              %)Total operating expenses
              
              
              247,540
              
              
              279,761
              
              
              (32,221
              )
              
              (12
              %)Loss
      from operations
              
              
              (247,540
              )
              
              (279,761
              )
              
              (32,221
              )
              
              (12
              %)Other
      income (expense):Interest
      income
              
              
              102
              
              
              6,959
              
              
              (6,857
              )
              
              (99
              %)Rental
      revenue
              
              
              26,614
              
              
              11,250
              
              
              15,364
              
              
              137
              %Loss
      on sale of equipment
              
              
              -
              
              
              3,701
              
              
              (3,701
              )
              
              (100
              %)Interest
      expense
              
              
              (29,264
              )
              
              (28,887
              )
              
              377
              
              
              1
              %Total other income (expense)
              
              
              (2,548
              )
              
              (6,977
              )
              
              (4,429
              )
              
              (63
              %)Net
      loss
              
              $
              (250,088
              )
              $
              (286,738
              )
              $
              (36,650
              )
              
              (13
              %)
 
 Exploration costs
  Exploration
costs for the six months ended June 30, 2008 decreased by $64,038 or 62% from
$102,943 for the six months ended June 30, 2007 to $38,905 for the six months
ended June 30, 2008. The decrease is due to our efforts to scale back on further
research as a result of the Cease Trade Order issued by the British Columbia
Securities Commission and therefore causing the inability to provide Private
Placement funding necessary to maintain operations.
 
 Unless
the Company is able to establish the economic viability of its mining
properties, the Company will continue writing off its expenses of exploration
and testing of its properties. Therefore, losses will continue unless the
Company sells one or more of its properties or locates and delineates reserves
and initiates mining operations. If that occurs, the Company may capitalize
certain of those expenses.
  21
 
 The
Company has no material commitments for capital expenditures other than
expenditures it chooses to make with respect to testing and or exploration of
its mineral properties.
  Depreciation
  Depreciation
for the six months ended June 30, 2008 decreased by $26 or -% from $6,021 for
the six months ended June 30, 2008 to $5,995 for the six months ended June 30,
2008. The decrease is principally due to less equipment on hand to depreciate
after the sale of equipment towards the end of the three month period ending
June 30, 2007.
  General and administrative
expenses
  General
and administrative expenses for the six months ended June 30, 2008 increased by
$35,895 or 34% from $106,745 for the six months ended June 30, 2007 to $142,640
for the six months ended June 30, 2008. The increase is principally due to
increased costs to maintain the office, including increased utility costs,
payroll, and payroll taxes associated with moving some of the administrative
functions in house.
  Officer
compensation
  Officer
compensation for the six months ended June 30, 2008 decreased by $4,052 or 6%
from $64,052 for the six months ended June 30, 2007 to $60,000 for the six
months ended June 30, 2008.
  Total operating
expenses
 
 Total
operating expenses for the six months ended June 30, 2008 decreased by $32,221
or 12% from $279,761 for the six months ended June 30, 2007 to $247,540 for the
six months ended June 30, 2008. The decrease in total operating expenses was
mainly a result of management’s efforts to scale back exploration costs until
the Company has the resources to effectively explore the claims that have been
obtained.
  Other income (expense)
 
 Interest
income for the six months ended June 30, 2008 decreased by $6,857 or 99% from
$6,959 for the six months ended June 30, 2007 to $102 for the six months ended
June 30, 2008. Interest income relates to interest earned on cash received as a
result of financing activities, of which less was on hand during the six months
ended June 30, 2008 compared to the same period in 2007.
 
 Rental
revenue for the six months ended June 30, 2008 increased by $15,364 or 137% from
$11,250 for the six months ended June 30, 2007 to $26,614 for the six months
ended June 30, 2008. Rental revenue relates to income derived from the rental of
the Company’s land for the purposes of filming movies or photo shoots. More
photo shoots, as well as, television commercials were performed during the six
months ended June 30, 2008 compared to the same period in 2007.
 
 Interest
expense for the six months ended June 30, 2008 increased by $377 or 1% from
$28,887 for the six months ended June 30, 2007 compared to $29,264 for the six
months ended June 30, 2008.
  Net loss
 
 Our net
loss was $250,088 for the six months ended June 30, 2008 compared to a net loss
of $286,738 for the six months ended June 30, 2007. We expect to improve our
results of operations through the attainment of sufficient working capital and a
focus on generating revenues from the subcontracting of mining activities, and a
reduction of general and administrative expenses.
 
 22
  (d)  Liquidity and Capital Resources and
Results of Operations
  The
following table summarizes total current assets, total current liabilities and
working capital at June 30, 2008 compared to December 31, 2007.
 June
      30,
                  2008
                
                December
      31,
                  2007
                
                Increase /
      (Decrease)$
                
                %Current
      Assets
                
                $
                77,927
                
                $
                105,987
                
                $
                (28,060
                )
                
                (26
                %)Current
      Liabilities
                
                $
                1,050,057
                
                $
                842,149
                
                $
                207,908
                
                
                25
                %Working
      Capital (deficit)
                
                $
                (972,130
                )
                $
                (831,552
                )
                $
                140,608
                
                
                17
                %
  Internal and External Sources of
Liquidity
  During
the six months ended June 30, 2008 and 2007, our operating and investing
activities used cash of $159,865 and $284,222, respectively, while our financing
activities provided cash of $126,705 and $269,029, respectively. The cash used
in operating activities was principally a result of the net loss we
incurred.
 
 Cash
Flow.
 
 Since
inception, we have primarily financed our cash flow requirements through the
issuance of common stock and the issuance of notes. With the growth of our
current business we may, during our normal course of business, experience net
negative cash flows from operations until some of our mining activities begin to
produce revenues. Further, we may be required to obtain financing to fund
operations through additional common stock offerings and bank or other debt
borrowings, to the extent available, or to obtain additional financing to the
extent necessary to augment our available working capital.
 
 Satisfaction of our cash obligations
for the next twelve months.
  Our plan
for satisfying our cash requirements for the next twelve months is through
additional equity, third party financing, and/or debt financing. We anticipate
our current cash reserves will be sufficient to support operations through
December 31, 2008, but do not anticipate generating sufficient amounts of
positive cash flow to meet our working capital requirements. Consequently, we
intend to make appropriate plans to ensure sources of additional capital in the
future to fund growth and expansion through additional equity or debt financing
or credit facilities. We also are considering possible funding through joint
venture arrangements with other mining companies. There can be no assurance that
we will raise capital through any of these means.
  23
 
 As we
expand operational activities, we may continue to experience net negative cash
flows from operations, pending receipt of sales and will be required to obtain
additional financing to fund operations through common stock offerings and debt
borrowings to the extent necessary to provide working capital.
 
 We
anticipate incurring operating losses until we build our capital base. Our
recent operating history makes predictions of future operating results difficult
to ascertain. In addition, since our cash position has fallen we are finding it
increasingly difficult to expand our operations. Thus, our prospects must be
considered in light of the risks, expenses and difficulties frequently
encountered by companies in their early stages of commercial viability,
particularly companies in rapidly evolving energy markets. 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,
implement and successfully execute our business and marketing strategy, continue
to develop and upgrade technology and products, respond to competitive
developments, and continue to 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.
 
 ITEM 3.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
 
 Not
applicable.
 
 ITEM 4T.
CONTROLS AND PROCEDURES
 
 The
Company maintains disclosure controls and procedures that are designed to ensure
that information required to be disclosed in the Company’s Exchange Act reports
is recorded, processed, summarized and reported within the time periods
specified in the SEC’s rules and forms, and that such information is accumulated
and communicated to the Company’s management, including its Chief Executive
Officer and Chief Financial Officer, as appropriate, to allow timely decisions
in accordance with the required "disclosure controls and procedures" as defined
in Rule 13a-15(e). The Company’s disclosure and control procedures are designed
to provide reasonable assurance of achieving their objectives, and the principal
executive officer and principal financial officer of the Company concluded that
the Company’s disclosure controls and procedures were effective at the
reasonable assurance level.
 
 At the
end of the period covered by this Quarterly Report, the Company carried out an
evaluation, under the supervision and with the participation of the Company's
management, including the Company's principal executive officer and principal
financial officer, of the effectiveness of the design and operation of the
Company's disclosure controls and procedures. Based of the foregoing, the
principal executive officer and principal financial officer of the Company
concluded that the Company’s disclosure controls and procedures were effective
to ensure that the information required to be disclosed in the Company’s
Exchange Act reports is recorded, processed, summarized and reported within the
time periods specified in the SEC’s rules and forms, and that such information
is accumulated and communicated to the Company’s management including the
Company’s principal executive officer and principal financial officer to allow
timely decisions regarding required disclosure.
 
 Changes
in Internal Control over Financial Reporting
  There
were no changes in our internal control over financial reporting, as defined in
Rules 13a-15(f) and 15d-15(f) under the Exchange Act, during our most recently
completed fiscal quarter that have materially affected, or are reasonably likely
to materially affect, our internal control over financial
 reporting.
 
 24
  PART II -
OTHER INFORMATION
 
 ITEM 1.
LEGAL PROCEEDINGS
 
 The
Company is not currently a party to litigation. The British Columbia Securities
Commission (BCSC) has recently required, and in July 2008 the Company obtained,
technical reports prepared by a Qualified Person under National Instrument 43-01
“Standards of Disclosure for Mineral Projects” (“NI 43-101”). As a result of the
tests, the Company withdraws its previously announced results in a press release
dated August 28, 2006 and in its Company Newsletter of November 21, 2006 for its
Wikieup and Pisgah projects, retracting its previous disclosure of mineral
reserves, mineral resources, other estimates of tons and grade, and any other
economic analyses of each of its mineral properties, including Wikieup and
Pisgah.
 
 Additionally,
the BCSC has also requested documentation regarding all subscribers to the
Company stock who are resident in British Columbia. The Company is cooperating
with the requested production.
 
 The BCSC,
at the time of the BCSC order requiring the Company’s production of the NI
43-101 report, suspended trading of the Company’s stock in British Columbia
until satisfactory completion of the 43-101 reports. The Company believes that
has met its obligations under the BCSC order, and anticipates that the BCSC will
lift the suspension of the trading of its stock
 
 ITEM 2.
CHANGES IN SECURITIES.
 
 The
Company neither sold nor issued securities during the quarter ended June 30,
2008.
 
 Previously
issued warrants to purchase 23,500 shares of the Company's common stock expired
during the three months ending March 31, 2008.
 
 ITEM 3.
DEFAULTS UPON SENIOR SECURITIES
 
 The
Company is in default on a note payable for $300,000 and its semi- annual
interest payments of $280,000 for the years ended 2002 - 2007, and the three
months ended March 31, 2008. The Company is currently negotiating forbearance on
collection of the principal and interest.
 
 The
Company is also in default on two notes payable to a stockholder, which matured
in January 2008 and February 2008, respectively. The principal amount of each
note is $25,114 and $35,436, with accrued interest of $1,362 and $1,922
respectively. Each note bears interest at 8.0% per annum and is secured by real
property. The Company is currently negotiating forbearance on collection of the
principal and interest of each note.
 
 ITEM 4.
SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
 
 None.
 
 ITEM 5.
OTHER INFORMATION
 
 N/A
  25
 
 ITEM 6.
EXHIBITS AND REPORTS ON FORM 8-K
 
 31.1
Certification under Rule 13a-14(a)
 
 32.1
Certification under Rule 13a-14(b)
 
 SIGNATURES
 
 In
accordance with the requirements of the Exchange Act, the registrant caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized.
  CAN-CAL
      RESOURCES LTD.

                  (REGISTRANT)Date: August 19, 2008
              By:
              /s/
      Ronald D. SloanRONALD
      D. SLOAN,

                  Chief
      Executive Officer and
President
  26