UNITED
STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 FORM
10-QSB-A Amendment
No. 1 (Mark One) x
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
  SECURITIES EXCHANGE ACT OF 1934For the quarterly period ended March 31, 2006.o
TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
  EXCHANGE ACTFor the transition period from
  _______________________ to ______________________ Commission file
number: 0-26525 BREDA TELEPHONE
CORP.
(Exact name of small business issuer as specified in its charter) Iowa

42-0895882(State or other
  jurisdiction

(I.R.S. Employerof incorporation or
  organization)

Identification No.) 112 E. Main, P.O.
Box 190, Breda, Iowa 51436
(Address of principal executive offices) (712) 673-2311
(Issuers telephone number) Check
whether the issuer (1) filed all reports required to be filed by Section 13 or
15(d) of the Exchange Act during the past 12 months (or for such 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
 Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). Yes o   No x State
the number of shares outstanding of each of the issuers classes of common
equity, as of the latest practicable date: 31,023 shares of common stock, no
par value, at May 1, 2006. Transitional Small Business Disclosure Format (Check
one): Yes o   No x    Explanatory Note

Breda
Telephone Corp. (Breda) is filing this Amendment No. 1 to its Quarterly
Report on Form 10-QSB for the quarterly period ended March 31, 2006 which was
originally filed with the Securities and Exchange Commission on May 12, 2006
(the Original 10-QSB) to amend Part I Financial InformationItem 1 Financial
Statements and Part II Other InformationItem 6 Exhibits. In all other
respects, the Original 10-QSB remains unchanged and is not otherwise amended
hereby.

  Bredas
    Form 10-QSB for the period ended March 31, 2006 is amended to restate Bredas
    income from equity investments derived from an investment in Iowa 8 Monona
    Limited Partnership (RSA #8). Two of Bredas subsidiaries each own an
    approximate 5.84% ownership interest in RSA #8. Twelve-months income figures
    for RSA #8, instead of three-month income figures, were inadvertently used
    to compute Bredas pro-rata share of the income generated by RSA #8 for
    the three-month period ended March 31, 2006, resulting in a $378,228 overstatement
    of income from equity investments in Bredas Form 10-QSB for the period
    ended March 31, 2006. After adjustment for that overstatement, net of income
    taxes, Bredas amended net income as of March 31, 2006, decreased $223,154,
    or $7.19/share.
1
PART
I - FINANCIAL INFORMATION

Item 1. Financial
Statements.

Breda Telephone Corp.
And Subsidiaries
Breda, IA

Condensed Consolidated Financial
Statements
For the Periods
Ended March 31, 2006 and 2005
And the Year Ended December 31, 2005

2
BREDA TELEPHONE CORP. AND SUBSIDIARIES
BREDA, IOWA

CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED) 
March 31, 2006 and December 31, 2005

March 31,

December
  31,2006

2005(As
  Restated)

(Unaudited)ASSETSCURRENT
  ASSETSCash and cash
equivalents

$
1,256,135

$
739,741Marketable
securities


671,086


635,409Accounts
receivable


1,013,671


952,579Interest
receivable


116,628


107,229Current
portion of note receivable


144,000


144,000Inventory, at
average cost


131,948


122,953Other


35,235


42,196Deferred
income taxes


16,127


22,7943,384,830


2,766,901OTHER
  NONCURRENT ASSETSMarketable
securities


5,588,277


5,463,298Investments in
unconsolidated affiliates at
  equity


5,326,282


5,519,572Other
investments at cost


782,365


790,066Goodwill


896,812


896,812Note
receivable, less allowance of $219,691
  in each 2006 and 2005


75,991


75,46912,669,727


12,745,217PROPERTY,
  PLANT AND EQUIPMENT


5,008,559


5,215,291TOTAL ASSETS

$
21,063,116

$
20,727,409LIABILITIES AND STOCKHOLDERS EQUITYCURRENT
  LIABILITIESCurrent
portion of long-term debt

$
167,248

$
164,513Accounts
payable


360,112


428,211Accrued
taxes


388,118


378,871Other


314,675


143,5821,230,153


1,115,177LONG-TERM
  DEBT, less current portion


1,272,083


1,314,935OTHER
  NONCURRENT LIABILITIES


810,225


855,542STOCKHOLDERS
  EQUITYCommon stock -
no par value, 5,000,000
  shares authorized, 31,023 and 31,023 shares issued and outstanding at $357
  and $357 stated values, respectively


11,075,211


11,075,211Retained
earnings


6,675,444


6,366,54417,750,655


17,441,755TOTAL
  LIABILITIES AND STOCKHOLDERS EQUITY

$
21,063,116

$
20,727,409The accompanying notes are an integral part of these condensed
consolidated financial statements.

2

BREDA TELEPHONE CORP. AND SUBSIDIARIES
BREDA, IOWA

CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED) 
For the Three Months Ended March 31, 2006 and 2005

2006

2005(As
  Restated)

(Unaudited)OPERATING
  REVENUES

$
2,022,881

$
1,928,227OPERATING
  EXPENSESCost of
services


893,953


843,577Depreciation
and amortization


242,749


245,026Selling,
general, and administrative


512,767


489,6821,649,469


1,578,285OPERATING
  INCOME


373,412


349,942OTHER INCOME
  (EXPENSES)Interest and
dividend income


93,829


97,311Interest
expense


(27,185
)

(30,015
)Income from
equity investments


282,851


246,388Other,
net


(377
)

(162
)349,118


313,522INCOME BEFORE
INCOME TAXES


722,530


663,464INCOME
TAXES


196,469


238,412NET
INCOME

$
526,061

$
425,052NET INCOME PER
COMMON SHARE

$
16.96

$
13.64The accompanying notes are an integral part of these condensed
consolidated financial statements.

3

BREDA TELEPHONE CORP. AND SUBSIDIARIES
BREDA, IOWA

CONDENSED CONSOLIDATED STATEMENTS OF
STOCKHOLDERS EQUITY

Common
  StockRetained
  EarningsShares

Amount


TotalBalance at
  December 31, 2004 (Audited)


31,170

$
10,161,420

$
5,736,268

$
15,897,688Comprehensive
income:Net
Income








1,814,736


1,814,736Dividends
paid








(218,190
)

(218,190
)Common stock
redeemed, net


(147
)

(52,479
)




(52,479
)Stated value
stock adjustment





966,270


(966,270
)Balance at
  December 31, 2005 (Unaudited)


31,023


11,075,211


6,366,544


17,441,755Comprehensive
income:Net Income (As
Restated)








526,061


526,061Dividends
declared








(217,161
)

(217,161
)Balance at
  March 31, 2006 (As Restated)


31,023

$
11,075,211

$
6,675,444

$
17,750,655The accompanying notes are an integral part of these condensed
consolidated financial statements.

4

BREDA TELEPHONE CORP. AND SUBSIDIARIES
BREDA, IOWA

CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS (UNAUDITED) 
For the Three Months Ended March 31, 2006 and 2005

2006

2005(As
  Restated)

(Unaudited)CASH FLOWS
  FROM OPERATING ACTIVITIESNet
income

$
526,061

$
425,052Adjustments to
reconcile net income to cash
  provided by operating activities:Depreciation
and amortization


242,749


245,026Deferred
income taxes


(38,650
)

(50,382
)Amortization
of investment tax credits





(1,403
)Amortization
of investment premium/discount
  - net


14,088


15,167Equity income
in unconsolidated affiliates,
  net of distributions received of $476,141 and $142,429 in 2006 and 2005,
  respectively


193,290


(103,959
)Note
receivable discount


(522
)

(1,895
)Changes in
assets and liabilities:(Increase)
Decrease in assets:


(72,525
)

(112,914
)Increase
(Decrease) in liabilities:


(117,626
)

255,345Net cash
provided by operating activities


746,865


670,037CASH FLOWS
  FROM INVESTING ACTIVITIESCapital
expenditures


(23,311
)

(138,938
)Purchase of
investments


(400,773
)

(313,839
)Purchase of
equity investments





(280,000
)Proceeds from
the sale of investments


226,029


2,529Proceeds from
the sale of other investments
  - at cost


7,701


7,209Net cash used
in investing activities


(190,354
)

(723,039
)CASH FLOWS
  FROM FINANCING ACTIVITIESRepayment of
long term debt


(40,117
)

(37,556
)Net cash used
in financing activites

$
(40,117
)
$
(37,556
)Net Increase
  (Decrease) in Cash and Cash Equivalents

$
516,394

$
(90,558
)Cash and
  Cash Equivalents at Beginning of Period


739,741


1,036,804Cash and
  Cash Equivalents at End of Period

$
1,256,135

$
946,246Supplemental
  Disclosures of Cash Flow InformationCash paid
during the period for:Interest

$
27,185

$
30,015Income
taxes

$
180,000

$
75,000The accompanying notes are an integral part of these condensed
consolidated financial statements.

5


BREDA TELEPHONE CORP. AND SUBSIDIARIES
BREDA, IOWA NOTES TO CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS NOTE 1.
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS  In the
  opinion of management, the accompanying condensed consolidated financial
  statements as restated contain all adjustments (consisting of only normal
  recurring items) necessary to present fairly the financial position as of
  March 31, 2006 and December 31, 2005 and the results of operation and changes
  in cash flows for the three months ended March 31, 2006 and 2005.Certain
  information and footnote disclosures normally included in annual financial
  statements prepared in accordance with accounting principles generally
  accepted in the United States of America have been condensed or omitted. It
  is suggested that these financial statements be read in conjunction with the
  financial statements and notes thereto included in the Companys December 31,
  2005 10-KSB as filed on April 13, 2006. The results of operations for the
  three-month period ended March 31, 2006 are not necessarily indicative of the
  operating results of the entire year.Bredas Form
  10-QSB for the period ended March 31, 2006 is amended to restate Bredas
  income from equity investments derived from its investment in RSA #8. Two of
  Bredas subsidiaries each own an approximate 5.84% ownership interest in RSA
  #8. Twelve-months income figures for RSA #8, instead of three-month income
  figures, were inadvertently used to compute Bredas pro-rata share of the
  income generated by RSA #8 for the three-month period ended March 31, 2006
  resulting in a $378,228 overstatement of income from equity investments on
  Bredas March 31, 2006 Form 10-QSB. Net of income taxes, Bredas amended net
  income as of March 31, 2006, decreased $223,154, or $7.19/share.Certain
  reclassifications have been made to the 2005 financial statements to conform
  with the 2006 presentations.  NOTE 2.
NONCASH INVESTING ACTIVITIES  Noncash
  investing activities included $12,706 and $28,871 during the three months
  ended March 31, 2006 and December 31, 2005, respectively, relating to plant
  and equipment additions under construction during the period, which are
  reflected in accounts payable at March 31, 2006 and December 31, 2005.  NOTE 3.
OPERATING SEGMENTS  The Company
  organizes its business into three reportable segments: local exchange carrier
  (LEC) services, broadcast services and Internet service provider (ISP)
  services. The LEC services segment provides telephone, data services and
  other services to customers in local exchanges. The broadcast services
  segment provides cable television services to customers in Iowa and Nebraska.
  The ISP services segment provides Internet access to customers within the
  local exchanges and the surrounding areas.The
  Companys reportable business segments are strategic business units that
  offer different products and services. Each reportable segment is managed
  separately primarily because of 6   NOTE 3.
OPERATING SEGMENTS (Continued)different
  products, services and regulatory environments. LEC segments have been
  aggregated because of their similar characteristics.The
  segments accounting policies are the same as those described in the summary
  of significant accounting policies.Three Months Ended
  March 31, 2006

Local
  Exchange
  Carrier

Broadcast

Internet
  Service
  Provider

TotalRevenuesExternal customers - as restated

$
1,676,882

$
186,001

$
159,998

$
2,022,881Segment profit (loss) - as restated

$
696,161

$
(41,824
)
$
(128,276
)

526,061Three Months Ended
  March 31, 2005

Local
  Exchange
  Carrier

Broadcast

Internet
  Service
  Provider

TotalRevenuesExternal customers

$
1,579,621

$
206,572

$
142,034

$
1,928,227Segment profit (loss)


524,677


(50,897
)

(48,728
)

425,052NOTE 4.
NET INCOME PER COMMON SHARENet income
  per common share for March 31, 2006 and 2005 was computed by dividing the
  weighted average number of shares of common stock outstanding into the net
  income. The weighted average number of shares of common stock outstanding for
  the three months ended March 31, 2006 and 2005 were 31,023 and 31,170,
  respectively.NOTE 5.
STOCK VALUE ADJUSTMENTDuring May
  2005, the board of directors authorized a $31 increase in the stated value of
  each share of common stock from $326 to $357. There were 31,170 shares
  outstanding at the time of the value adjustment, which reduced retained
  earnings by $966,270.[THE REST OF THIS PAGE IS INTENTIONALLY LEFT
BLANK]

7

PART II - OTHER INFORMATION

Item 6.
Exhibits.A list of
  the exhibits included as part of this quarterly report is set forth in the
  Exhibit Index which immediately precedes such exhibits and is incorporated
  herein by this reference.[THE REST OF THIS PAGE IS INTENTIONALLY LEFT
BLANK]

8

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.

BREDA
  TELEPHONE CORP.Date:
  November 15, 2006.
By:
/s/ Steve
  FrickensteinSteve
  Frickenstein, Chief Executive OfficerDate:
  November 15, 2006.
By:
/s/ Jane
  MorlokJane Morlok,
  Chief Financial Officer9


EXHIBIT
INDEXExhibits to Form 10-QSB
Three Months Ended March 31, 2006
BREDA TELEPHONE CORP. Description
  of Exhibit

Page3.
Articles
  of Incorporation and Bylaws3.1
Amended and Restated Articles of Incorporation of
  Breda Telephone Corp. (Filed as Exhibit 3.1 to Bredas Registration Statement
  on Form 10-SB, and incorporated herein by this reference.)3.2
Amended and Restated Bylaws of Breda Telephone Corp.10.
Material
  Contracts10.1
Employment Agreement dated July 1, 2003 between
  Breda and Jane Morlok. (Filed as Exhibit 10.2 to Bredas Form 10-QSB for the
  quarterly period ended June 30, 2003 and filed August 12, 2003, and
  incorporated herein by this reference.)*31.
Rule 13a-14(a)/15d-14(a) Certifications31.1
Rule 13a-14(a) Certification
  of Chief Executive Officer

E-131.2
Rule 13a-14(a) Certification
  of Chief Financial Officer

E-2*32.
Section 1350 Certifications32.1
Section 1350 Certification
  of Chief Executive Officer

E-332.2
Section 1350 Certification
  of Chief Financial Officer

E-4 *Included with this filing.