**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**





**FORM
      10-QSB**





(Mark
      One)




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





**For
      the quarterly period ended June 30, 2007**





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




For
      the
      transition period from __________ to __________





*Commission
      File Number* : 0-27569





**NATURAL
      NUTRITION, INC.**


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





**Nevada**
            
            **65-0847995**(State
                or other jurisdiction of incorporation or organization)
            
            (IRS
                Employer Identification No.)**109
                North Post Oak Lane, Suite 422****Houston,
                TX 77024**(Address
                of principal executive offices)**(713)
                621-2737**(Issuer's
                telephone number)**(Formerly
                CSI Business Finance,
                Inc.)**





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 xNo o





Indicate
      by check whether the registrant is a shell company (as defined in Rule 12b-2
      of
      the Exchange Act). Yes
oNo
x





The
      number of shares outstanding of our common stock at August 16, 2007 was
      18,631,922.





Transitional
      Small Business Disclosure Format (check one): Yes:oNo: x









**NATURAL
      NUTRITION, INC.**


(Formerly
      CSI Business Finance, Inc.)


**FORM
      10-QSB**





**INDEX**





Page
              NumberPART
                I - FINANCIAL INFORMATIONItem
                1. Financial StatementsCondensed
                Consolidated Balance Sheet as of June 30, 2007 (Unaudited)
            
            
            3Condensed
                Consolidated Statements of Operations for the three months ended
                June 30,
                2007 and 2006 (Unaudited)
            
            
            4Condensed
                Consolidated Statements of Operations for the six months ended June
                30,
                2007 and 2006 (Unaudited)
            
            
            5Condensed
                Consolidated Statements of Cash Flows for the six months ended June
                30,
                2007 and 2006 (Unaudited)
            
            
            6Notes
                to Condensed Consolidated Financial Statements (Unaudited)
            
            
            7-16Item
                2. Management's Discussion and Analysis or Plan of
                Operation
            
            
            16-20Item
                3. Controls and Procedures
            
            
            21-22PART
                II - OTHER INFORMATIONItem
                1. Legal Proceedings
            
            
            22Item
                2. Unregistered Sales of Equity Securities and Use of
                Proceeds
            
            
            22Item
                3. Defaults Upon Senior Securities
            
            
            22Item
                4. Submission of Matters to a Vote of Security Holders
            
            
            22Item
                5. Other Information
            
            
            22Item
                6. Exhibits
            
            
            22SIGNATURES
            
            
            23





2


**PART
                  I - FINANCIAL INFORMATION****ITEM
                  1. FINANCIAL STATEMENTS****NATURAL
                  NUTRITION, INC. AND SUBSIDIARIES****(Formerly
                  CSI Business Finance, Inc.)****CONDENSED
                  CONSOLIDATED BALANCE SHEET****June
                  30, 2007****(Unaudited)**
  **ASSETS****CURRENT
                  ASSETS**Cash
              
              $
              1,906,199Trade
                  accounts receivable-net of $23,451 allowance for doubtful
                  accounts
              
              
              2,249,312Notes
                  receivable
              
              
              1,946,221Inventory-net
                  of allowance of $248,555
              
              
              2,526,807Investment
                  in marketable securities
              
              
              362,000Due
                  from affiliate
              
              
              874Deferred
                  finance costs
              
              
              150,475Prepaids,
                  accrued interest and other accounts receivable
              
              
              1,181,936Total
                  current assets
              
              
              10,323,824**NONCURRENT
                  ASSETS**Investments
              
              
              25,000Fixed
                  assets, net
              
              
              1,273,462Intellectual
                  property
              
              
              4,271,126Goodwill
              
              
              8,524,483Total
                  noncurrent assets
              
              
              14,094,071**TOTAL
                  ASSETS**
              
              $
              24,417,895**LIABILITIES
                  AND SHAREHOLDERS' DEFICIT****CURRENT
                  LIABILITIES**Accounts
                  payable, accrued liabilities and other current liabilities
              
              $
              2,021,399Taxes
                  payable
              
              
              2,242,652Total
                  current liabilities
              
              
              4,264,051**NONCURRENT
                  LIABILITIES**Convertible
                  debenture payable--net of discount of $275,562
              
              
              15,352,637Convertible
                  note payable--net of discount of $2,150,301
              
              
              7,142,593Derivative
                  liabilities
              
              
              4,113,613Deferred
                  taxes payable
              
              
              937,522Capital
                  lease obligations and notes payable
              
              
              161,813Accrued
                  interest payable
              
              
              1,184,680Total
                  liabilities
              
              
              33,156,909**COMMITMENTS
                  AND CONTINGENCIES**
              
              
              -**SHAREHOLDERS'
                  DEFICIT**Preferred
                  stock, $.01 par value; 10,000,000 shares authorizedPreferred
                  stock Series A Convertible $0.01 par value;100,000
                  shares authorized, 94,443 shares issued and outstanding and
                  noliquidation
                  or redemption value
              
              
              944Common
                  stock, par value $0.001; 10,000,000,000 sharesauthorized;
                  18,631,922 issued and outstanding
              
              
              18,632Additional
                  paid-in capital
              
              
              267,338Retained
                  deficit
              
              
              (9,077,339
              )Accumulated
                  other comprehensive income, foreign currency translation
                  adjustment
              
              
              51,411Total
                  shareholders' deficit
              
              
              (8,739,014
              )**TOTAL
                  LIABILITIES AND SHAREHOLDERS' DEFICIT**
              
              $
              24,417,895
  See
                  accompanying Notes to Condensed Consolidated Financial Statements
                  (unaudited)




3


**NATURAL
                  NUTRITION, INC. AND SUBSIDIARIES****(Formerly
                  CSI Business Finance, Inc.)****CONDENSED
                  CONSOLIDATED STATEMENTS OF OPERATIONS****(Unaudited)****Three
                  months ended June 30,****2007**
              
              **2006****REVENUE**Sales
                  revenue
              
              $
              1,569,341
              
              $
              -Fee
                  income
              
              
              -
              
              
              66,155Trading
                  gains
              
              
              8,726
              
              
              86,881Dividends
                  from marketable securities
              
              
              1,310
              
              
              71,893Interest
                  income from notes and debenture receivable
              
              
              79,425
              
              
              29,236Total
                  revenue
              
              
              1,658,802
              
              
              254,165**OPERATING
                  EXPENSES**Cost
                  of sales revenue
              
              
              1,299,517
              
              
              -Selling,
                  general and administrative expenses (2007 and 2006include
                  $48,522 and $69,861, respectively of expensesallocated
                  from an affiliated entity)
              
              
              1,890,981
              
              
              375,976Total
                  operating expenses
              
              
              3,190,498
              
              
              375,976**OPERATING
                  LOSS**
              
              
              (1,531,696
              )
              
              (121,811
              )**OTHER
                  (INCOME) EXPENSE**Net
                  change in fair value of derivative
              
              
              2,722,184
              
              
              (81,070
              )Interest
                  and other income
              
              
              (7,719
              )
              
              (16,976
              )Interest
                  expense
              
              
              380,824
              
              
              261,200Total
                  other (income) expense
              
              
              3,095,289
              
              
              163,154Loss
                  before provision for income taxes
              
              
              (4,626,985
              )
              
              (284,965
              )**INCOME
                  TAX PROVISION**
              
              
              32,737
              
              
              -**NET
                  LOSS APPLICABLE TO COMMON SHARES**
              
              $
              (4,659,722
              )
              $
              (284,965
              )Net
                  loss per share for basic and diluted
              
              $
              (0.29
              )
              $
              (0.05
              )Weighted
                  shares outstanding for basic and diluted
              
              
              16,308,690
              
              
              6,287,670**OTHER
                  COMPREHENSIVE INCOME****NET
                  LOSS**
              
              $
              (4,659,722
              )
              $
              (284,965
              )Foreign
                  currency translation adjustment
              
              
              51,411
              
              
              -**COMPREHENSIVE
                  LOSS**
              
              $
              (4,608,311
              )
              $
              (284,965
              )See
                  accompanying Notes to Condensed Consolidated Financial Statements
                  (unaudited)
  4
  **NATURAL
                  NUTRITION, INC. AND SUBSIDIARIES****(Formerly
                  CSI Business Finance, Inc.)****CONDENSED
                  CONSOLIDATED STATEMENTS OF OPERATIONS****(Unaudited)**
  **Six
                  months ended June 30,****2007**
              
              **2006****REVENUE**Sales
                  revenue
              
              $
              1,569,341
              
              $
              -Lease
                  income
              
              
              -
              
              
              39,684Fee
                  income
              
              
              2,965
              
              
              66,155Trading
                  gains (losses)
              
              
              12,011
              
              
              (46,892
              )Dividends
                  from marketable securities
              
              
              8,469
              
              
              246,435Interest
                  income from notes and debenture receivable
              
              
              153,483
              
              
              172,666Total
                  revenue
              
              
              1,746,269
              
              
              478,048**OPERATING
                  EXPENSES**Cost
                  of sales revenue
              
              
              1,299,517
              
              
              -Selling,
                  general and administrative expenses (2007 and 2006include
                  $149,721 and $136,404, respectively of expensesallocated
                  from an affiliated entity)
              
              
              2,265,094
              
              
              699,335Total
                  operating expenses
              
              
              3,564,611
              
              
              699,335**OPERATING
                  LOSS**
              
              
              (1,818,342
              )
              
              (221,287
              )**OTHER
                  (INCOME) EXPENSE**Net
                  change in fair value of derivative
              
              
              2,762,552
              
              
              (63,812
              )Loss
                  on extinguishment of debenture receivable
              
              
              -
              
              
              639Interest
                  and other income
              
              
              (17,238
              )
              
              (28,235
              )Interest
                  expense
              
              
              630,734
              
              
              536,188Total
                  other expense
              
              
              3,376,048
              
              
              444,780Loss
                  before provision for income taxes
              
              
              (5,194,390
              )
              
              (666,067
              )**INCOME
                  TAX PROVISION**
              
              
              32,737
              
              
              -**NET
                  LOSS APPLICABLE TO COMMON SHARES**
              
              $
              (5,227,127
              )
              $
              (666,067
              )Net
                  loss per share for basic and diluted
              
              $
              (0.36
              )
              $
              (0.11
              )Weighted
                  shares outstanding for basic and diluted
              
              
              14,447,642
              
              
              6,287,670**OTHER
                  COMPREHENSIVE LOSS****NET
                  LOSS**
              
              $
              (5,227,127
              )
              $
              (666,067
              )Foreign
                  currency translation adjustment
              
              
              51,411
              
              
              -**COMPREHENSIVE
                  LOSS**
              
              $
              (5,175,716
              )
              $
              (666,067
              )See
                  accompanying Notes to Condensed Consolidated Financial Statements
                  (unaudited)
  5
  **NATURAL
                  NUTRITION, INC. AND SUBSIDIARIES****(Formerly
                  CSI Business Finance, Inc.)****CONDENSED
                  CONSOLIDATED STATEMENTS OF CASH FLOWS****(Unaudited)**
  **Six
                  Months Ended June 30,****2007**
              
              **2006****CASH
                  FLOWS FROM OPERATING ACTIVITIES**Net
                  loss
              
              $
              (5,227,127
              )
              $
              (666,067
              )Adjustment
                  to reconcile net income to net cashprovided
                  by (used in) operating activities
              
              
              5,141,221
              
              
              1,061,064Net
                  cash provided by (used in) operating activities
              
              
              (85,906
              )
              
              394,997**CASH
                  FLOWS FROM INVESTING ACTIVITIES**Cash
                  acquired in acquisition
              
              
              609,022
              
              
              -Sale
                  of asset
              
              
              100,000
              
              
              -Net
                  cash provided by investing activities
              
              
              709,022
              
              
              -**CASH
                  FLOWS FROM FINANCING ACTIVITIES**Proceeds
                  from issuance of convertible note, net
              
              
              1,070,910
              
              
              -Payments
                  on capital lease obligations
              
              
              (7,491
              )
              
              -Payments
                  on notes payable to affiliate
              
              
              -
              
              
              (344,282
              )Net
                  cash provided by (used in) financing activities
              
              
              1,063,419
              
              
              (344,282
              )**EFFECT
                  OF EXCHANGE RATE CHANGE ON CASH**
              
              
              70,973
              
              
              -**NET
                  CHANGE IN CASH**
              
              
              1,757,508
              
              
              50,715**CASH,
                  BEGINNING OF PERIOD**
              
              
              148,691
              
              
              204,243**CASH,
                  END OF PERIOD**
              
              $
              1,906,199
              
              $
              254,958**SUPPLEMENTAL
                  INFORMATION**Interest
                  paid
              
              $
              710
              
              $
              73,544Taxes
                  paid
              
              $
              -
              
              $
              -Purchase
                  of INII:Fair
                  value of assets acquired
              
              $
              19,184,506
              
              $
              -Liabilities
                  assumed
              
              $
              4,720,596
              
              $
              -Discount
                  on convertible note
              
              $
              2,185,159
              
              $
              -Embedded
                  derivative and warrant liability
              
              $
              1,180,870
              
              $
              -Non-cash
                  portion of convertible note payable
              
              $
              8,221,964
              
              $
              -Deferred
                  finance costs
              
              $
              153,000
              
              $
              -Exchange
                  of certain receivable for common stock:Common
                  stock acquired
              
              $
              -
              
              $
              9,887,959Debentures
                  and notes receivable exchanged
              
              $
              -
              
              $
              9,609,283Accrued
                  interest receivable exchanged
              
              $
              -
              
              $
              278,676See
                  accompanying Notes to Condensed Consolidated Financial Statements
                  (unaudited)
  6


**Natural
      Nutrition, Inc. and Subsidiaries**


**(Formerly
      CSI Business Finance, Inc.)**


**Notes
      to Condensed Consolidated Financial Statements**


**(Unaudited)**




**NOTE
      1**  **-
      BASIS OF PRESENTATION**





Our
      Condensed Consolidated Balance Sheet as of June 30, 2007, the Condensed
      Consolidated Statements of Operations for the three and six months ended June
      30, 2007 and June 30, 2006, and the Condensed Consolidated Statements of Cash
      Flows for the six months ended June 30, 2007 and June 30, 2006 have not been
      audited. These statements have been prepared on a basis that is substantially
      consistent with the accounting principles applied in our Annual Report on Form
      10-KSB for the fiscal year ended December 31, 2006. In our opinion, these
      financial statements include all normal and recurring adjustments necessary
      for
      a fair presentation of Natural Nutrition, Inc. (the “Company”) and Subsidiaries.
      The results for the six months are not necessarily indicative of the results
      expected for the year.





Footnotes
      number 2 and 6 through 11 and number 13 refer to our Canadian subsidiary only.





As
      used
      herein, the “Company”, “management”, “we”, “our” refers to Natural Nutrition,
      Inc., or Natural Nutrition, Inc. together with its subsidiaries. The Company's
      fiscal year ends on December 31st.




Certain
      information and footnote disclosures normally included in financial statements
      prepared in accordance with accounting principles generally accepted in the
      United States of America have been omitted in accordance with the published
      rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”)
      for interim financial statements. The unaudited Condensed Consolidated Financial
      Statements and the notes thereto in this report should be read in conjunction
      with the audited Consolidated Financial Statements and notes thereto included
      in
      our Annual Report on Form 10-KSB for the fiscal year ended December 31,
      2006 (the “10-KSB”).





Natural
      Nutrition, Inc. (the “Company”), formerly CSI Business Finance, Inc., formerly
      Health Express USA, Inc., was incorporated in Florida on July 2, 1998. On August
      25, 2005, the Company completed the closing of that certain Share Exchange
      Agreement, by and between the Company, CSI Business Finance, Inc., a Texas
      corporation and now wholly-owned subsidiary of the Company herein referred
      to as
      ("CSI") and the shareholder of CSI (the "CSI Shareholder").





On
      August
      25, 2005, the Company effectively exchanged with the CSI Shareholder the issued
      and outstanding common stock of CSI in exchange for 100,000 shares of Series
      A
      Convertible Preferred Stock, par value $0.01 per share, of the Company, and
      CSI
      became a wholly-owned subsidiary of the Company. Each share of the Company's
      Series A Preferred Stock is convertible into 780 shares of common stock of
      the
      Company, beginning one year after the effective date of the merger. The
      Preferred shares were subsequently distributed to the shareholders of Corporate
      Strategies, Inc., the former shareholder of CSI. In addition, at the exchange
      date, 4,326,861 shares of common stock of the Company were issued to pay off
      notes and debentures. If the preferred shareholders were to convert to common
      stock as of the date of the merger, they would hold 78,000,000 shares, or
      ninety-two and one half percent (92.5%) of the issued and outstanding shares
      of
      common stock of the Company. This conversion would result in the Series A
      Preferred Shareholders effectively controlling the Company.





The
      Series A Convertible Preferred Shareholders and the holders of the common stock
      of the Company vote together and not as separate classes, and the Preferred
      Stock shall be counted on an "as converted" basis, thereby giving the Preferred
      Shareholders control of the Company. The transaction was accounted for as a
      reverse acquisition since control of the Company passed to the shareholders
      of
      the acquired company (CSI).





The
      Company was subsequently renamed in 2005 to CSI Business Finance, Inc. (the
      Florida corporation). In September of 2006, CSI Business Finance, Inc. changed
      its name to Natural Nutrition, Inc. and simultaneously redomiciled from Florida
      to Nevada.





On
      May
      23, 2006, our Board of Directors approved a 1 for 25 reverse common stock split.
      All references to our common stock in this document are stated in shares after
      the reverse split.





The
      accompanying unaudited condensed consolidated financial statements for prior
      years contain certain reclassifications to conform with current year
      presentation.





The
      unaudited condensed consolidated financial statements include the accounts
      of
      the Company and its wholly-owned subsidiaries. All significant inter-company
      accounts and transactions have been eliminated in consolidation.





7




**Change
      in Accounting Principle for Registration Payment
      Arrangements.**





In
      December 2006, the Financial Accounting Standards Board (“FASB”) issued FASB
      Staff Position on No. EITF 00-19-2, Accounting for Registration Payment
      Arrangements (“FSP EITF 00-19-2”). FSP EITF 00-19-2 provides that the contingent
      obligation to make future payments or otherwise transfer consideration under
      a
      registration payment arrangement should be separately recognized and measured
      in
      accordance with Statement of Financial Accounting Standards (“FAS”) No. 5,
      Accounting for Contingencies, which provides that loss contingencies should
      be
      recognized as liabilities if they are probable and can be reasonably estimated.
      Subsequent to the adoption of FSP EITF 00-19-2, any changes in the carrying
      amount of the contingent liability will result in a gain or loss that will
      be
      recognized in the consolidated statement of operations in the period the changes
      occur. The guidance in FSP EITF 00-19-2 is effective immediately for
      registration payment arrangements and the financial instruments subject to
      those
      arrangements that are entered into or modified subsequent to the date of
      issuance of FSP EITF 00-19-2. For registration payment arrangements and
      financial instruments subject to those arrangement that were entered into prior
      to the issuance of FSP EITF 00-19-2, this guidance is effective for our
      consolidated financial statements issued for the year beginning January 1,
      2007,
      and interim periods within that year.





On
      January 1, 2007, we adopted the provisions of FSP EITF 00-19-2 to account for
      the registration payment arrangement associated with our September 2005
      financing (the “September 2005 Registration Payment Arrangement”). As of January
      1, 2007 and June 30, 2007, management determined that it was not probable that
      we would have any payment obligation under the September 2005 Registration
      Payment Arrangement; therefore, no accrual for contingent obligation is required
      under the provisions of FSP EITF 00-19-2. Accordingly, the comparative condensed
      consolidated financial statements of prior periods have been adjusted to apply
      the new method prospectively.





We
      adopted the provisions of FSP EITF 00-19-2 to account for the registration
      payment arrangement associated with our May 2007 financing (the “May 2007
      Registration Payment Arrangement”). As of June 30, 2007, management determined
      that it was not probable that we would have any payment obligation under the
      May
      2007 Registration Payment Arrangement; therefore, no accrual for contingent
      obligation is required under the provisions of FSP EITF 00-19-2. Accordingly,
      the comparative condensed consolidated financial statements of prior periods
      have been adjusted to apply the new method prospectively.





**NOTE
      2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**





**Inventories**
            Labels,
                packaging and raw materials are stated at the lower of cost or market.
                Cost is determined using the moving average cost
                method.





Finished
      goods are stated at the lower of cost or market. Cost is determined using the
      first-in, first-out (FIFO) method.





**Advertising
                Costs**
            Advertising
                costs, including cooperative advertising payments to retailers, are
                charged to expense in the period that the advertising first takes
                place.
                Advertising costs for the one month ended June 30, 2007 was
                $2,324.





**Shipping
                Costs**
            Shipping
                costs associated with the distribution of finished product to our
                customers are recorded as selling, general and administrative expense
                and
                are recognized when the related finished product is shipped to the
                customer. Shipping costs for the one month ended June 30, 2007 was
                $13,144.





**Research
                  and****Development**
            All
                expenditures for research and development are charged against earnings
                in
                the year incurred.




**Intangible
                Assets**
            Intangible
                assets consist of customer relations, trade secrets and goodwill.
                Customer
                relations and trade secrets are being amortized over 8 and 6 years,
                respectively. Goodwill has an indefinite life and is carried at cost.
                The
                impairment evaluation of the carrying amount of intangible assets
                with
                indefinite lives is conducted annually, or more frequently if events
                or
                changes in circumstances indicate that an asset might be impaired.
                An
                impairment loss would be recognized when fair value is less than
                the
                carrying amount of the intangible, measured as the excess of the
                carrying
                amount of the intangible over its fair
                value.





**Income
                Taxes**
            Deferred
                tax assets and liabilities are determined based on the temporary
                differences between the financial reporting and tax bases of assets
                and
                liabilities, applying enacted statutory tax rates in effect for the
                year
                in which the differences are expected to reverse. A valuation allowance
                is
                recorded when it is more likely than not that some or all of the
                deferred
                tax assets will not be realized.





8




**Property
                  and Equipment**
            Property
                  and equipment are recorded at cost. Depreciation is based on the
                  estimated
                  useful life of the asset and is provided as
                  follows:




Manufacturing
                  equipment
              
              7
                  years
              
              straight
                  lineFurniture
                  and office equipment
              
              5
                  years
              
              straight
                  lineComputer
                  equipment
              
              7
                  months
              
              straight
                  lineComputer
                  software
              
              7
                  months
              
              straight
                  lineLeasehold
                  improvements
              
              10
                  years
              
              straight
                  line





One-half
      of the above rates is used in the year of acquisition.





The
      Company reviews long-lived assets for impairment whenever events or changes
      in
      circumstances indicate that their carrying amount may not be recoverable. An
      impairment loss would be recognized when estimated undiscounted future cash
      flows from the operation and disposition of the assets are less than the
      carrying amount of the assets. Measurement of an impairment loss would be based
      on the excess of the carrying amount of the assets over their fair value. Fair
      value is measured using discounted cash flows or independent appraisals as
      appropriate.




**Revenue
              recognition**
            The Company's revenue recognition policies are in
              compliance with Staff Accounting Bulletin 104. Revenue is recognized
              upon
              acceptance of the shipment by the customer, no other significant
              obligation of the Company exists and collectibility is reasonably assured.  **Foreign
                Exchange**
            Our
                wholly owned subsidiary, INII, considers the Canadian currency as
                its
                functional currency. The results of operations are translated in
                U.S.
                dollars using average exchange rates for the periods presented. Assets
                and
                liabilities are translated at the rate of exchange in effect at the
                balance sheet date, and differences from historical exchange rates
                are
                reflected within accumulated other comprehensive income in shareholders'
                equity as foreign currency translation
                adjustments.





**NOTE
      3. INCOME (LOSS) PER COMMON SHARE AND STOCK BASED
      COMPENSATION**




**Net
      Income (Loss) Per Common Share**




In
      accordance with SFAS No. 128, "Earnings per Share", basic earnings per share
      are
      computed based on the weighted average shares of common stock outstanding during
      the periods.  Diluted earnings per share are computed based on the weighted
      average shares of common stock plus the assumed issuance of common stock for
      all
      potentially dilutive securities.





Our
      basic
      and diluted shares used to compute loss per common share amounts are the same
      for both the three months and six months ended June 30, 2007 and June 30, 2006.
      Since we had a net loss for the three and six months ended June 30, 2007 and
      June 30, 2006, the assumed exercise of stock options and the conversion of
      the
      Series A Preferred Stock and secured convertible debentures outstanding as
      of
      June 30, 2007 and June 30, 2006 would be anti-dilutive.





**Stock
      Based Compensation**




Statement
      of Financial Accounting Standards No. 123(R), “Accounting for Stock-Based
      Compensation” (“SFAS 123(R)”), provides for the use of a fair value-based method
      of accounting for employee stock compensation. There are outstanding stock
      options to purchase 5,695 of the Company's common stock at an exercise price
      of
      $32.75 per share. These options expire in August 2007. We believe these options
      do not have a fair market value and we expect them to be forfeited.




**NOTE
      4**  **-
      PURCHASE OF INTERACTIVE NUTRITION INTERNATIONAL, INC.**




Effective
      May 31, 2007, Natural Nutrition, Inc., a Nevada corporation (the “ Company ”)
      closed
      on a purchase agreement (the “ Purchase
      Agreement ”)
      with
      Nesracorp. Inc., a company organized under the laws of Canada (the “ Vendor ”)
      pursuant to which the Company purchased from the Vendor, and the Vendor sold,
      assigned transferred and conveyed to the Company, all of Vendor’s right, title,
      benefit and interest in (a) all of the then outstanding principal and interest
      accrued thereon (the “ Indebtedness ”)
      owed
      to the Vendor by Interactive Nutrition International, Inc. (“ INII ”),
      a
      company organized under the laws of Canada and a wholly-owned subsidiary of
      the
      Company, under a promissory note in the original principal amount of Fifteen
      Million Canadian Dollars (Cdn$15,000,000) issued (in part) by INII to the Vendor
      on March 31, 2004 (the “ Subsidiary
      Note ”)
      and
      (b) a general security agreement, of even date with the Subsidiary Note, and
      a
      share pledge agreement, of even date with the Subsidiary Note, both granted
      concurrently by INII and its shareholder, the Company (as successor in interest
      to the now defunct Bio One Corporation) in connection with the Indebtedness
      (together, both instruments are hereinafter referred to as the “ Security ”)
      for a
      purchase price equal to (i) Seven Million Six Hundred Fifty Thousand Canadian
      Dollars (Cdn$7,650,000) and (ii) the execution by the Company of that certain
      Mutual Release.  The Company and the Vendor entered into an Assignment and
      Conveyance (“ Assignment ”),
      of
      even date with the Purchase Agreement, in order to properly effectuate the
      assignment by the Vendor to the Company of all of the right, title, benefit
      and
      interest in and to the Purchased Assets (as defined therein), which such
      Purchased Assets include, without limitation, the Indebtedness, the Security
      and
      all loan, security and other documentation relating to the Indebtedness and
      the
      Security purchased under the Purchase Agreement.  The Company and the
      Vendor executed the Purchase Agreement, the Mutual Release and the Assignment
      on
      May 25, 2007, however they closed the transactions upon the execution of the
      SPA
      (as defined and discussed herein below) on May 31, 2007.




9





On
      May
      31, 2007, the Company entered into a securities purchase agreement (the
“ SPA ”)
      with
      Cornell Capital Partners, LP (the “ Investor ”)
      pursuant to which the Company sold to the Investor, and the Investor purchased
      from the Company, a secured convertible promissory note (the “ Note ”)
      in the
      principal amount of Nine Million Two Hundred Ninety-Two Thousand Eight Hundred
      Ninety-Four United States Dollars (US$9,292,894), the proceeds of which shall
      be
      used by the Company to finance the consideration paid by the Company to the
      Vendor in connection with the Purchase Agreement and Assignment (as discussed
      herein above) and for other general corporate purposes.





The
      Note
      shall accrue interest at a rate equal to twelve percent (12%) per annum, except
      that from and after the occurrence and during the continuance of an Event of
      Default (as defined in the Note), the interest rate shall be increased to
      eighteen percent (18%). The Note shall mature, unless extended by the holder,
      upon the earlier of (i) June 1, 2012, (ii) the consummation of a Change of
      Control (as defined in the Note) and (iii) the occurrence of an Event of Default
      or any event that with the passage of time and the failure to cure would result
      in an Event of Default. The Company may prepay the Note at any time upon not
      less than thirty (30) days prior written notice to the holder; provided, that
      any such prepayments shall applied first to unpaid late charges on principal
      and
      interest, if any, then to unpaid interest and then unpaid principal thereon.
      Furthermore, the Note shall be convertible into fully paid and nonassessable
      shares of the Company’s common stock, par value $0.001 per share (the
“ Common
      Stock ”),
      at
      the holder’s discretion, at a conversion rate to be determined by dividing the
      amount to be converted by the lesser or (x) $0.05, subject to adjustment as
      provided herein and (y) eighty percent (80%) of the lowest daily weighted
      average price of the Company’s common stock, par value $0.001 per share
      (“ Common
      Stock ”)
      during
      the five (5) trading days immediately preceding the conversion date. The Company
      shall not effect any conversion, and the holder of shall not have the right
      to
      convert any portion of the Note to the extent that after giving effect to such
      conversion, the holder (together with the holder’s affiliates) would
      beneficially own in excess of 4.99% of the number of shares of Common Stock
      outstanding immediately after giving effect to such conversion.





All
      payments due under the Note shall be senior to all other Indebtedness (as
      defined in the Note) of the Company and its subsidiaries other than certain
      Permitted Indebtedness (as defined in the Note). So long as the Note is
      outstanding, the Company shall not, and the Company shall not permit any of
      its
      subsidiaries to, directly or indirectly (a) incur or guarantee, assume or suffer
      to exist any Indebtedness, other than (i) the Indebtedness evidenced by the
      Note and the Subsidiary Note and (ii) other Permitted Indebtedness, (b)
      allow or suffer to exist any mortgage, lien, pledge, charge, security interest
      or other encumbrance upon or in any property or assets (including accounts
      and
      contract rights) owned by the Company or any of its subsidiaries other than
      certain permitted liens, (c) redeem, defease, repurchase, repay or make any
      payments in respect of, by the payment of cash or cash equivalents (in whole
      or
      in part, whether by way of open market purchases, tender offers, private
      transactions or otherwise), all or any portion of any Permitted Indebtedness,
      whether by way of payment in respect of principal of (or premium, if any) or
      interest on, such Indebtedness if at the time such payment is due or is
      otherwise made or, after giving effect to such payment: (i) an event
      constituting an Event of Default has occurred and is continuing; or (ii) an
      event that with the passage of time and without being cured would constitute
      an
      Event of Default has occurred and is continuing; or (iii) make any payments
      to
      Turnaround Partners, Inc. (“ TAP ”),
      Corporate Strategies, Inc. (“ CSI ”)
      or any
      of their members, partners, employees, stockholders, or any of their respective
      affiliates, except (1) with the prior consent of the holder, (2) pursuant to
      either the Zeidman Agreement (as defined herein below) or that certain Connolly
      Agreement (as defined herein below), (3) reasonable rent and overhead charges
      allocable to the Company in respect of shared space with CSI, (4) so long as
      Mr.
      Timothy J. Connolly (“ Mr.
      Connolly ”)
      is
      serving as CEO of the Company, the reimbursement to Mr. Connolly for all direct
      expenses incurred by Mr. Connolly in connection with such service and (5)
      payments by CSI Business Finance, Inc., the Texas corporation and wholly-owned
      subsidiary of the Company (“ CSIBF ”)
      to Mr.
      Connolly for compensation payable to Mr. Connolly solely out of cash generated
      from CSIBF’s operations.





Until
      the
      Note has been converted, redeemed or otherwise satisfied in full in accordance
      with its terms, the Company shall not, directly or indirectly, redeem,
      repurchase, or declare or pay any cash dividend or distribution on, its capital
      stock without the prior express written consent of the holder or, dissolve,
      liquidate, consolidate with or into another person, or dispose of or otherwise
      transfer (whether in one transaction or in a series of transactions) all or
      substantially all of its assets (whether now owned or hereafter acquired) to
      or
      in favor of any person or acquire any assets or business or any interest in
      any
      person or entity in excess of One Hundred Thousand United States Dollars
      (US$100,000), except for purchases of inventory, raw materials and equipment
      in
      the ordinary course of business. So long as the Note is outstanding, for each
      accounting period identified on Exhibit
      C to the
      Note, the Company shall maintain EBITDA for such accounting period which equals
      or exceeds the applicable EBITDA threshold for such accounting period.





In
      connection with the SPA, the Company also issued to the Investor warrants to
      purchase, in Investor’s sole discretion, Sixty-Two Million Five Hundred Eight
      Thousand One Hundred Seventy-Nine (62,508,179) shares of Common Stock at a
      price
      of $0.01 per share (the “ Warrant ”).
      So
      long as the Company is in default under any of the Transaction Documents (as
      defined in the SPA) or the shares underlying the Warrant are not subject to
      an
      effective registration statement, the holder may, in its sole discretion during
      such time, exercise the Warrant in whole or in part and, in lieu of making
      the
      cash payment otherwise contemplated to be made to the Company upon such exercise
      in payment of the Aggregate Exercise Price (as defined in the Warrant), elect
      instead to receive upon such exercise the net number of shares of Common Stock
      determined according to a specified formula set forth in the Warrant. The
      Company shall not effect the exercise of the Warrant, and the holder shall
      not
      have the right to exercise the Warrant, to the extent that after giving effect
      to such exercise, such person (together with such person’s affiliates) would
      beneficially own in excess of 4.99% of the shares of Common Stock outstanding
      immediately after giving effect to such exercise.




10





Contemporaneously
      with the execution and delivery of the SPA, the Company and the Investor
      executed and delivered a registration rights agreement (the “ RRA ”)
      pursuant to which the Company shall provide certain registration rights to
      Investor with respect to the Registrable Securities (as defined in the RRA)
      under the Securities Act of 1933, as amended and the rules and regulations
      promulgated thereunder, and applicable state securities laws. Specifically,
      if
      the Company shall receive at any time and from time to time after the aggregate
      principal amount of the Note is below One Million Five Hundred Thousand United
      States Dollars (US$1,500,000) in whatever form, including without limitation,
      the reduction of the outstanding balance by conversions by the Investor into
      shares of Common Stock or cash payments by the Company, a written request from
      the holders of at least fifty percent (50%) of the Registrable Securities then
      outstanding, that the Company file with the U.S. Securities and Exchange
      Commission (“ SEC ”)
      a
      registration statement covering the resale of the Registrable Securities, then
      the Company shall, within thirty (30) days of the receipt thereof, provide
      written notice of such request to all other holders of Registrable Securities,
      if any, and file with the SEC such registration statement, as soon as
      practicable, following receipt of the registration request. The registration
      statement shall register for resale at least thirty-three percent (33%) of
      the
      Company’s market capitalization based on the Company’s shares of Common Stock
      issued and outstanding and market price of the Company’s shares of Common Stock
      at the time of the registration request less any shares of Common Stock held
      by
      affiliates of the Company, or such greater amount as the Company in good faith
      believes the SEC may permit to be registered. The Company shall use its best
      efforts to have the registration statement declared effective by the SEC no
      later than such date as follows: (i) in the event that the registration
      statement is not subject to a review by the SEC, sixty (60) calendar days after
      the date of the registration request or (ii) in the event that the
      registration statement is subject to a review by the SEC, one hundred twenty
      (120) calendar days after the date of the registration request.





In
      connection with the SPA, the Company and the Investor also entered into an
      amended and restated security agreement, of even date with the SPA (the
“ 2007
      Security Agreement ”),
      pursuant to which the Company amended and restated that certain Security
      Agreement, dated September 9, 2005 (the “ 2005
      Security Agreement ”),
      to
      secure within the definition of “Obligations” as previously defined under the
      2005 Security Agreement, those obligations of the Company under the SPA, the
      Note and the Transaction Documents (as defined in the SPA). The Company and
      the
      Investor also entered into a securities pledge agreement, of even date with
      the
      SPA (the “ 2007
      Pledge Agreement ”),
      in
      order for the Company to pledge that certain Pledged Property (as defined
      therein), which includes the Subsidiary Note, to secure its obligations under
      the SPA, the Note and the Transaction Documents (as defined in the SPA).




In
      connection with the SPA, the Company, the Investor and Mr. Timothy J. Connolly,
      acting on behalf of CSI, entered into an agreement, of even date with the SPA
      (the “ Connolly
      Agreement ”),
      pursuant to which the Company granted to Mr. Connolly, on behalf of CSI, shares
      representing ten percent (10%) of the common stock of INII (the “ INII
      Stock ”)
      outstanding as of the date of the Agreement as compensation for management
      services performed by CSI to the Company. Such grant vested and the INII Stock
      has been deemed fully earned as of the date of the Agreement. As a condition
      to
      this grant, Mr. Connolly entered into a lock-up agreement and a securities
      pledge agreement with the Investor, whereby Mr. Connolly pledged the INII Stock
      as collateral to secure all obligations owed by the Company to the Investor.




In
      connection with the SPA, the Company entered into a five (5) year employment
      agreement with Mr. Fred Zeidman pursuant to which Mr. Zeidman shall serve as
      a
      non-executive Chairman of the Board (the “ Zeidman
      Agreement ”).
      In
      consideration for his services, Mr. Zeidman shall receive, as compensation
      for
      all services rendered by Mr. Zeidman in performance of his duties or obligations
      under the Zeidman Agreement, a monthly base salary of Twelve Thousand Five
      Hundred United States Dollars (US$12,500). In addition to a base salary, Mr.
      Zeidman shall also have the right to receive an incentive fee equal to up to
      ten
      percent (10%) of the Net Proceeds (as defined therein) of the Sale (as defined
      therein) of INII. This bonus shall incrementally vest twenty percent (20%)
      per
      year on the anniversary date of the Zeidman Agreement, so long as (A) Mr.
      Zeidman’s employment with the Company has not terminated as of the applicable
      vesting date and (B) the actual financial results of INII for the twelve (12)
      month period prior to the applicable vesting date are not less than ninety
      percent (90%) of the pro forma EBITDA results of INII attached to the Zeidman
      Agreement as Exhibit
      A ; provided that
      upon a Sale prior to the fifth (5 th )
      anniversary of the commencement date, so long as Mr. Zeidman’s employment has
      not terminated prior to such Sale, then the remaining part of the bonus shall
      vest upon the consummation of such Sale. Mr. Zeidman is also entitled to be
      reimbursed by the Company for all reasonable and necessary expenses incurred
      by
      Mr. Zeidman in carrying out his duties under the Zeidman Agreement in accordance
      with the Company’s standard policies regarding such reimbursements. Mr. Zeidman
      is also entitled during the term of the Zeidman Agreement, upon satisfaction
      of
      all eligibility requirements, if any, to participate in all health, dental,
      disability, life insurance and other benefit programs now or hereafter
      established by the Company which cover substantially all other of the Company’s
      employees and shall receive such other benefits as may be approved from time
      to
      time by the Company.





11




Since
      the
      acquisition was completed on May 31, 2007, only the period from June 1 through
      June 30, 2007 is included in our three and six months results of operations
      ending June 30, 2007.





The
      following unaudited pro forma financial information presents the consolidated
      results of operations for the six months ended June 30, 2007, as if the
      acquisition had occurred on January 1, 2007, after giving effect to certain
      adjustments. The pro forma information does not necessarily reflect the results
      of operations that would have occurred had the entities been a single company
      during this period.


Six
                  months ended June 30,2007
              
              2006(Unaudited)Net
                  sales
              
              $
              8,617,288
              
              $
              8,140,371Net
                  loss
              
              $
              (4,994,351
              )
              $
              (1,432,959
              )Weighted
                  average number of common shares outstanding
              
              
              14,447,642
              
              
              6,287,670Income
                  per common share - basic and diluted
              
              $
              (0.35
              )
              $
              (0.23
              )





**NOTE
      5 - CONVERTIBLE DEBENTURES AND NOTES PAYABLE AND DERIVATIVE FINANCIAL
      INSTRUMENTS**




Effective
      September 9, 2005, the Company issued a secured convertible debenture (the
      "Debenture") to Cornell Capital Partners, LP in the amount of $15,635,199.
      Effective May 31, 2007, the convertible debenture was renegotiated and the
      due
      date was extended until June 1, 2012 and the fixed conversion price was reset.
      All other terms and conditions remained the same. The notes bear interest at
      5%,
      which is accrued until maturity on June 1, 2012. The note is convertible, at
      the
      option of the holders, into common stock of the Company at a price of $0.012
      per
      share, subject to standard anti-dilution provisions relating to splits, reverse
      splits and other transactions plus a reset provision whereby the conversion
      prices may be adjusted downward to a lower price per share based on the average
      of the three lowest closing prices for the five trading days prior to
      conversion. The Holder has the right to cause the notes to be converted into
      common stock, subject to an ownership limitation of 4.99% of the outstanding
      stock. The Company has the right to repurchase the Notes at 106% of the face
      amount.





On
      May
      31, 2007, the Company entered into a securities purchase agreement (the
“ SPA ”)
      with
      Cornell Capital Partners, LP (the “ Investor ”)
      pursuant to which the Company sold to the Investor, and the Investor purchased
      from the Company, a secured convertible promissory note (the “ Note ”)
      in the
      principal amount of Nine Million Two Hundred Ninety-Two Thousand Eight Hundred
      Ninety-Four United States Dollars (US$9,292,894), the proceeds of which shall
      be
      used by the Company to finance the consideration paid by the Company to the
      Vendor in connection with the Purchase Agreement and Assignment (as discussed
      herein above) and for other general corporate purposes.





The
      Note
      shall accrue interest at a rate equal to twelve percent (12%) per annum, except
      that from and after the occurrence and during the continuance of an Event of
      Default (as defined in the Note), the interest rate shall be increased to
      eighteen percent (18%). The Note shall mature, unless extended by the holder,
      upon the earlier of (i) June 1, 2012, (ii) the consummation of a Change of
      Control (as defined in the Note) and (iii) the occurrence of an Event of Default
      or any event that with the passage of time and the failure to cure would result
      in an Event of Default. The Company may prepay the Note at any time upon not
      less than thirty (30) days prior written notice to the holder; provided, that
      any such prepayments shall applied first to unpaid late charges on principal
      and
      interest, if any, then to unpaid interest and then unpaid principal thereon.
      Furthermore, the Note shall be convertible into fully paid and nonassessable
      shares of the Company’s common stock, par value $0.001 per share (the
“ Common
      Stock ”),
      at
      the holder’s discretion, at a conversion rate to be determined by dividing the
      amount to be converted by the lesser or (x) $0.05, subject to adjustment as
      provided herein and (y) eighty percent (80%) of the lowest daily weighted
      average price of the Company’s common stock, par value $0.001 per share
      (“ Common
      Stock ”)
      during
      the five (5) trading days immediately preceding the conversion date. The Company
      shall not effect any conversion, and the holder of shall not have the right
      to
      convert any portion of the Note to the extent that after giving effect to such
      conversion, the holder (together with the holder’s affiliates) would
      beneficially own in excess of 4.99% of the number of shares of Common Stock
      outstanding immediately after giving effect to such conversion.





The
      derivatives from the debenture and note payable have been accounted for in
      accordance with SFAS 133 and EITF No. 00-19, "Accounting for Derivative
      Financial Instruments Indexed to, and Potentially Settled in, a Company's Own
      Stock."




12





The
      Company has determined that the following instruments have derivatives requiring
      evaluation and accounting under the relevant guidance applicable to financial
      derivatives:





Cornell
                Debenture Payable issued 9/9/05 in the face amount of
                $15,635,199Cornell
                Note Payable issued 5/31/07 in the face amount of
                $9,292,894





The
      Company has identified that the above debenture and note have embedded
      derivatives. These embedded derivatives have been bifurcated from their
      respective host debt contracts and accounted for as derivative liabilities
      in
      accordance with EITF 00-19. When multiple derivatives exist within the
      Convertible Debentures, they have been bundled together as a single hybrid
      compound instrument in accordance with SFAS No. 133 Derivatives Implementation
      Group Implementation Issue No. B-15, "Embedded Derivatives: Separate Accounting
      for Multiple Derivative Features Embedded in a Single Hybrid
      Instrument."




The
      embedded derivatives within the Convertible Debenture and Note have been
      recorded at fair value at the date of issuance; and are marked-to-market each
      reporting period with changes in fair value recorded to the Company's income
      statement as "Net change in fair value of derivatives." The Company has utilized
      a third party valuation firm to fair value the embedded derivatives using a
      layered discounted probability-weighted cash flow approach. The fair value
      model
      utilized to value the various embedded derivatives in the Convertible Debenture
      and Note, comprises multiple probability-weighted scenarios under various
      assumptions reflecting the economics of the Convertible Debenture, such as
      the
      risk-free interest rate, expected Issuer stock price and volatility, likelihood
      of conversion and or redemption, and likelihood default status.





The
      fair
      value of the derivative liabilities are subject to the changes in the trading
      value of the Company's common stock, as well as other factors. As a result,
      the
      Company's financial statements may fluctuate from quarter-to-quarter based
      on
      factors, such as the price of the Company's stock at the balance sheet date
      and
      the amount of shares converted by the debenture holders. Consequently, our
      financial position and results of operations may vary from quarter-to-quarter
      based on conditions other than our operating revenues and expenses.





The
      conversion feature, reset provision and the Company’s optional early redemption
      right to the debenture payable have been bundled together as a single compound
      embedded derivative liability, and using a layered discounted
      probability-weighted cash flow approach, was initially fair valued at $413,603
      at September 9, 2005. As of May 31, 2007, the maturity date of the Cornell
      debenture dated September 9, 2005 was extended to June 1, 2012 and the fixed
      conversion price was reset to $0.012. This modification of the debt was tested
      under EITF 96-19, Debtors Accounting for a Modification or Exchange of Debt
      Instruments and EITF 06-06, Debtors Accounting for a Modification (or Exchange)
      of Convertible Debt Instruments to determine if an extinguishment had occurred.
      The Company’s third party valuation firm determined that the debt was not
      extinguished, so no gain or loss was recorded. The compound embedded derivative
      was valued at $550,749 at June 30, 2007 using the same methodology. For the
      period since December 31, 2006 through June 30, 2007, the change in fair value
      of the derivative liability was an increase of $380,558, which has been
      classified as net change in fair value of derivative.





The
      above
      compound embedded derivative plus the loan costs paid the lender in the amount
      of $687,832 are recorded as a discount against the notional carrying amount
      of
      the debenture payable. The unamortized discount is being amortized over the
      term
      of the note using the effective interest method. Recorded in interest expense
      for this amortization is $112,026 at June 30, 2007 and $64,526 at June 30,
      2006.





The
      conversion feature, reset provision and the Company’s optional early redemption
      right to the note payable have been bundled together as a single compound
      embedded derivative liability, and using a layered discounted
      probability-weighted cash flow approach, was initially fair valued at $554,080
      at May 31, 2007. Using the same methodology, the single compound embedded
      derivative liability was valued at $1,924,935 at June 30, 2007. For the period
      since May 31, 2007 through June 30, 2007, the change in fair value of the
      derivative liability was an increase of $1,370,854, which has been classified
      as
      net change in fair value of derivative.





In
      addition to the above, the Company issued warrants that resulted in a warrant
      derivative liability. This warrant derivative liability using the Black-Sholes
      Option Pricing Model, was initially fair valued at $626,790 at May 31, 2007.
      Using the same methodology, the warrant derivative liability was valued at
      $1,637,930 at June 30, 2007. For the period since May 31, 2007 through June
      30,
      2007, the change in fair value of the derivative liability was an increase
      of
      $1,011,140, which has been classified as net change in fair value of derivative.
      The significant assumptions for the Black-Sholes Option Pricing Model at June
      30, 2007 was the current stock price, 0% dividend yield, a risk free interest
      rate of 4.56% and a 350% volatility.





The
      above
      compound embedded derivative plus the warrant derivative plus the loan costs
      paid the lender in the amount of $1,004,289 are recorded as a discount against
      the notional carrying amount of the note payable. The unamortized discount
      is
      being amortized over the term of the note using the effective interest method.
      Recorded in interest expense for this amortization is $37,383 at June 30, 2007
      and $0 at June 30, 2006.





The
      significant assumptions for Natural Nutrition’s debenture and note utilized in
      valuing the embedded derivatives as of June 30, 2007:




·
            The
                stock price would increase at the cost of equity with a short-term
                volatility of 200%




·
            Registration
                default would occur only 5% of the
                time




13




·
            Other
                forms of default would occur 5% of the time, increasing .3% per
                quarter




·
            Alternative
                financing would be available starting at 0%, increasing 5% per quarter
                to
                a maximum of 20%




·
            Common
                Shares outstanding would increase 1% per
                quarter




·
            Exercise
                pricing reset events would occur 5% of the time with an adjustment
                factor
                to the warrant exercise price of 0.9922




·
            Quarterly
                conversions of the debentures would be limited to the lessor of 4.99%
                of
                the outstanding stock or 25% of the average 22-day trading
                volume.




**NOTE
      6 - INVENTORIES:**




Inventories
      consist of the following:




Raw
                materials
            
            $
            1,764,114Packaging
                materials
            
            
            598,462Marketing
                materials
            
            
            109,787Finished
                goods
            
            
            54,444Total
            
            $
            2,526,807





**NOTE
      7 - PROPERTY AND EQUIPMENT**


June
                  30, 2007Cost
              
              Accumulated
                  DepreciationManufacturing
                  equipment
              
              $
              925,056
              
              $
              11,013Furniture
                  and office equipment
              
              
              56,064
              
              
              934Computer
                  equipment
              
              
              18,688
              
              
              2,670Computer
                  software
              
              
              18,688
              
              
              2,670Leasehold
                  improvements
              
              
              270,976
              
              
              2,258$
              1,289,472
              
              $
              19,545





Property
      and equipment include manufacturing equipment and furniture and fixtures held
      under capital leases. These capital leases are depreciated under the Company’s
      normal depreciation schedule. Depreciation expense for the one month period
      ending June 30, 2007 for our Canadian subsidiary was $19,545.





**NOTE
      8 - INTELLICUTUAL PROPERTY AND GOODWILL**


June
                  30, 2007Cost
              
              Accumulated
                  AmortizationTrade
                  secrets
              
              $
              1,106,654
              
              
              15,370Customer
                  relations
              
              
              3,213,314
              
              
              33,472Goodwill
              
              
              8,524,483
              
              
              -$
              12,844,451
              
              $
              48,842





Goodwill
      was recorded in connection with the purchase of our Canadian subsidiary. The
      amortization of intangibles for the one month period ending June 30, 2007 for
      our Canadian subsidiary was $48,842.




14





**NOTE
      9 - LONG-TERM DEBT AND CAPITAL LEASES**





The
      Company has long-term debt payable to the Canadian subsidiaries landlord for
      leasehold improvements. The note is payable in monthly installment of $1,013.
      The balance at June 30, 2007 is $24,701.





The
      Company has capital lease obligations with a remaining term of approximately
      four and one-half years. The imputed interest ranges from 7.48% to 9.75%. The
      balance on these capital lease obligations at June 30, 2007 is
      $137,112.





**NOTE
      10 - CANADIAN INCOME TAXES**





The
      current taxes payable, non-current deferred taxes payable and the income tax
      provisions in the statement of operations belongs to our Canadian subsidiary.
      The current income tax expense differs from the amount calculated using Canadian
      statutory provincial and federal rates applied to the accounting net income
      due
      to the cumulative eligible capital deduction for taxes.





The
      significant temporary differences that give rise to deferred tax liabilities
      are
      property and equipment and intangible assets.





**NOTE
      11 - CONCENTRATION AND RISKS**





**Market
      Risks**





As
      part
      of the ongoing business operations, the Company is exposed to market risks
      such
      as foreign currency exchange rates, commodity prices and concentration risks.





**Foreign
      Exchange Transaction Risk**





The
      Company is exposed to fluctuations in foreign currency cash flows related
      primarily to third-party purchases and sales. The primary Canadian dollar
      exchange rate exposure is with the U.S. dollar.





**Commodity
      Price Risk**





The
      Company is exposed to price fluctuations primarily as a result of anticipated
      purchases of ingredients. The principal raw material that is used in the
      manufacturing of products is whey protein. Recently the price of whey has
      increased significantly, and may adversely affect the Canadian subsidiary’s
      historic margins.





**Credit
      Risk**





At
      June
      30, 2007, one customer account made up approximately 64% of the total trade
      accounts receivable balance.





**Concentration
      Risk**





Sales
      to
      the largest customer for this reporting period accounted for approximately
      58%
      of total sales for the month of June 30, 2007.





**NOTE
      12 - SEGMENT REPORTING**





Our
      company has two business segments: business services (which consist of lending
      services) and manufacturing and sales of nutritional products through our wholly
      owned subsidiary, Interactive Nutrition International, Inc.





The
      Company's operations are conducted in the United States and Ottawa, Ontario,
      Canada.




15




**Business**
              
              **Nutritional****Services**
              
              **Products****Six
                  months ended June 30, 2007**Revenue
              
              $
              176,928
              
              $
              1,569,341Income
                  (loss) before income tax
              
              
              (5,243,111
              )
              
              48,721Segment
                  assets
              
              
              4,173,072
              
              
              20,244,823**Six
                  months ended June 30, 2006**Revenue
              
              $
              478,048
              
              $
              -Loss
                  before income tax
              
              
              (666,067
              )
              
              -Segment
                  assets
              
              
              16,379,407
              
              
              -





**NOTE
      13 - COMMITMENTS**





The
      Company leases its building and warehouse at a current minimum annual cost
      of
      $272,784. The Company is also responsible for its share of property tax,
      maintenance and utility costs on the warehouse lease. The leases expire on
      April
      30, 2009.




Future
      minimum payments under the building and warehouse leases described above, on
      a
      fiscal year basis are as follows:


2007
              
              $
              131,0622008
              
              
              266,4852009
              
              
              88,828$
              486,375





**NOTE
      14 - RELATED PARTY TRANSACTIONS**





We
      realized an expense of $889,804 for the three and six months ended June 30,
      2007
      for consulting services provided by an affiliated company, Turnaround Partners,
      Inc., for the acquisition of INII. This amount represents a one time fee only.
      The Company and Turnaround Partners, Inc. are separate public entities that
      are
      under common control.





**NOTE
      15 - COMMON STOCK**





During
      the first 6 months of this year, we have issued 6,513,259 new shares of common
      stock. We issued 5,666,667 shares to officers and directors from our 2006 Stock
      Incentive Plan while the remaining 846,592 were issued to two separate companies
      for consulting services.





**ITEM
                2****.**
            **MANAGEMENT'S
                DISCUSSION AND ANALYSIS OR PLAN OF
                OPERATION.**




**FORWARD-LOOKING
      STATEMENTS AND ASSOCIATED RISKS**





This
      Quarterly Report on Form 10-QSB, and the accompanying MD&A, contains
      forward-looking statements.  Statements contained in this report about
      Natural Nutrition, Inc.'s future outlook, prospects, strategies and plans,
      and
      about industry conditions and demand for our financial services are
      forward-looking.  All statements that express belief, expectation,
      estimates or intentions, as well as those that are not statements of historical
      fact, are forward looking. The words "proposed," "anticipates," "anticipated,"
      "will," "would," "should," "estimates" and similar expressions are intended
      to
      identify forward-looking statements.  Forward-looking statements represent
      our reasonable belief and are based on our current expectations and assumptions
      with respect to future events. While we believe our expectations and assumptions
      are reasonable, they involve risks and uncertainties beyond our control that
      could cause the actual results or outcome to differ materially from the expected
      results or outcome reflected in our forward-looking statements.  In light
      of these risks, uncertainties and assumptions, the forward-looking events
      discussed in this quarterly report may not occur.  Such risks and
      uncertainties include, without limitation, our successful efforts in the outcome
      of our litigation concerning our investment in INII, or the extension of our
      agreement in lieu of foreclosure, our success in trading marketable securities,
      our ability to maintain contracts that are critical to our operations, actual
      customer demand for our financing and related services, collection of accounts
      and notes receivable, our ability to obtain and maintain normal terms with
      our
      vendors and service providers and conditions in the capital markets and equity
      markets during the periods covered by the forward-looking
      statements.





16


The
      forward-looking statements contained in this report speak only as of the date
      hereof.  We undertake no obligation to publicly update or revise any
      forward-looking statements, whether as a result of new information, future
      events or any other reason.  All


forward-looking
      statements attributable to Natural Nutrition, Inc. or any person acting on
      its
      behalf are expressly qualified in their entirety by the cautionary statements
      contained or referred to in our annual report filed on Form 10-KSB and in our
      future periodic reports filed with the SEC. The following M,D&A should be
      read in conjunction with these unaudited Condensed Consolidated Financial
      Statements of the Company, and the related notes thereto included elsewhere
      herein, and in conjunction with our audited financial statements, together
      with
      footnotes and the M,D&A, in our 2006 annual report filed on Form 10-KSB with
      the Securities Exchange Commission (the “SEC”).





**Overview**




On
      August
      25, 2005, Health Express USA, Inc., a Florida corporation, entered into a share
      exchange agreement with CSI Business Finance, Inc., a Texas corporation (“CSI”)
      and the shareholder of CSI (Corporate Strategies, Inc.). The transaction is
      being reflected as a reverse acquisition since control of the Company has passed
      to the shareholders of Corporate Strategies, Inc. (“Corporate Strategies”). The
      Company was subsequently renamed in 2005 to CSI Business Finance, Inc. (the
      Florida corporation). In September of 2006 CSI Business Finance, Inc. changed
      its name to Natural Nutrition, Inc. and simultaneously redomiciled from Florida
      to Nevada.





On
      May
      23, 2006, our Board of Directors approved a 1 for 25 reverse split of our common
      stock. All references to our common stock in this document are stated in shares
      after the reverse split.





All
      significant intercompany accounts and transactions have been eliminated in
      consolidation.





Prior
      to
      our settlement of the litigation related to INII, and our takeover of control
      of
      those operations, our Company, through our operating subsidiary, primarily
      generated cash and revenue from financing and investing activities. To date
      these activities have included equipment leasing, factoring, loan brokerage
      activities earned in originating and selling business leases, providing short
      term secured lending, and investing in marketable securities. Competition for
      the services we provide comes mainly from financial institutions that provide
      factoring services, equipment leases and small business loans, many of which
      have substantially more capital resources than our Company.





Management
      of the Company mitigates its risk in lending by securing loans with pledged
      assets (collateral) that, when liquidated, have a reasonable probability of
      realizing proceeds that would retire the liability. In some instances, we obtain
      personal guarantees from individuals of net worth which are adequate to repay
      the liability in the event of default. Additionally, in the example of public
      company finance, we utilize conversion features at a substantial discount to
      the
      market in the event of default that would enable us to realize adequate proceeds
      from the sale of the borrower's stock to repay the liability to the Company.
      Over the long term, management will be concentrating its efforts on growing
      the
      business of INII, our largest asset.





Effective
      May 31, 2007, Natural Nutrition, Inc., a Nevada corporation (the “ Company ”)
      closed
      on a purchase agreement (the “ Purchase
      Agreement ”)
      with
      Nesracorp. Inc., a company organized under the laws of Canada (the “ Vendor ”)
      pursuant to which the Company purchased from the Vendor, and the Vendor sold,
      assigned transferred and conveyed to the Company, all of Vendor’s right, title,
      benefit and interest in (a) all of the then outstanding principal and interest
      accrued thereon (the “ Indebtedness ”)
      owed
      to the Vendor by Interactive Nutrition International, Inc. (“ INII ”),
      a
      company organized under the laws of Canada and a wholly-owned subsidiary of
      the
      Company, under a promissory note in the original principal amount of Fifteen
      Million Canadian Dollars (Cdn$15,000,000) issued (in part) by INII to the Vendor
      on March 31, 2004 (the “ Subsidiary
      Note ”)
      and
      (b) a general security agreement, of even date with the Subsidiary Note, and
      a
      share pledge agreement, of even date with the Subsidiary Note, both granted
      concurrently by INII and its shareholder, the Company (as successor in interest
      to the now defunct Bio One Corporation) in connection with the Indebtedness
      (together, both instruments are hereinafter referred to as the “ Security ”)
      for a
      purchase price equal to (i) Seven Million Six Hundred Fifty Thousand Canadian
      Dollars (Cdn$7,650,000) and (ii) the execution by the Company of that certain
      Mutual Release.  The Company and the Vendor entered into an Assignment and
      Conveyance (“ Assignment ”),
      of
      even date with the Purchase Agreement, in order to properly effectuate the
      assignment by the Vendor to the Company of all of the right, title, benefit
      and
      interest in and to the Purchased Assets (as defined therein), which such
      Purchased Assets include, without limitation, the Indebtedness, the Security
      and
      all loan, security and other documentation relating to the Indebtedness and
      the
      Security purchased under the Purchase Agreement.  The Company and the
      Vendor executed the Purchase Agreement, the Mutual Release and the Assignment
      on
      May 25, 2007, however they closed the transactions upon the execution of the
      SPA
      on May 31, 2007.





INII
      manufactures quality sport nutrition and health food products.





17




Recent
      Accounting Pronouncements





In
      February 2007, the FASB issued FASB Statement No. 159, *Establishing the Fair Value Option for Financial Assets and
      Liabilities* (“SFAS
      159”) *,* to
      permit all entities to choose to elect to measure eligible financial instruments
      at fair value. SFAS 159 applies to fiscal years beginning after November 15,
      2007, with early adoption permitted for an entity that has also elected to
      apply
      the provisions of SFAS 157, *Fair
      Value Measurements* . An
      entity is prohibited from retrospectively applying SFAS 159, unless it chooses
      early adoption. Management is currently evaluating the impact of SFAS 159 on
      the
      consolidated financial statements.





**RESULTS
      OF OPERATIONS**





**Three
      Months Ended June 30, 2007 and June 30, 2006**





Interactive
      Nutrition International, Inc. (“INII”) was acquired by us on May 31, 2007.
      Accordingly, the results of operations for INII include only the one month
      ended
      June 30, 2007.





Sales
      revenue for the month of June 2007 was $1,569,341. This revenue was generated
      from sales of nutritional products from INII.





Fee
      income from brokerage fees earned in originating and selling business leases
      and
      loans was $0 for the three months ended June 30, 2007 versus $66,155 for the
      three months ended June 30, 2006. We may continue to seek lending opportunities
      to generate fee income in the future, however, this is not the primary focus
      of
      management, or the Company’s resources.





Interest
      Income was $79,425 for the three months ended June 30, 2007 as compared to
      $29,236 for the three months ended June 30, 2006. Interest income was derived
      mainly from notes receivable relating to investments as well as interest from
      a
      debenture and notes that were subsequently traded on March 22, 2006 for stock
      in
      a Canadian subsidiary of the maker of the debentures. Dividend income was $1,310
      for the three months ended June 30, 2007 and $71,893 for the three months ended
      June 30, 2006. Dividend income is primarily derived from various investments
      in
      marketable securities. For the three months ended June 30, 2007, we recorded
      net
      trading gains from various investments in marketable securities in the amount
      of
      $8,726. For the three months ended June 30, 2006, we recorded $86,881in net
      trading gains.





**Cost
      of goods sold, selling, general and administrative expenses and other income
      and
      expenses.**





INII





Cost
      of
      sales for our revenue in INII was $1,299,517. Cost of sales includes material,
      labor and manufacturing costs associated with the production of our
      products.





Selling,
      general and administrative expenses were $221,103 for the month of June 30,
      2007. These expenses include salaries and benefits, professional fees and other
      ordinary expenses necessary to carry out our operations.





Houston
      operations





Our
      corporate operations in Houston, Texas have not yet reached the size to benefit
      from separate office space and a dedicated staff. Our Company shares office
      space and certain administrative functions and staff with an affiliated company.
      Costs are allocated for these shared functions are based on an estimate of
      time
      usage.





Our
      Houston operating expenses were approximately $1,669,878 for the three months
      ended June 30, 2007 as compared to $375,676 for three months ended June 30,
      2006. Approximately
      $890,000 of the total expenses was a one-time fee paid to an affiliate for
      past
      services rendered for control of INII. In addition, we incurred bad debt expense
      of $402,680 for the three months ended June 30, 2007 and $0 for the three months
      ended June 30, 2006.





Salaries
      and Benefits were $171,125 for the three months ended June 30, 2007 as compared
      to $98,676 for the three months ended June 30, 2006. The primary reason for
      the
      increase was for the hiring of a part-time CFO in July 2006 and an acquisition
      specialist in January 2007. Our acquisition specialist resigned in May 2007
      after the completion of the INII purchase.




Professional
      fees were $984,979 for the three months ended June 30, 2007 as compared to
      $197,400 for the same period ending June 30, 2006. The primary reason for the
      increase is the one-time fee for services as described above.




Interest
      expense was $380,824 for the three months ended June 30, 2007 and $261,200
      for
      the three months ended June 30, 2006. Interest expense primarily relates to
      the
      expense associated with the $15,635,199 five percent (5%) convertible debenture
      entered into in September 2005, one month interest on our May 31, 2007 note
      and
      interest on our margin loan.





The
      Company was allocated overhead from an affiliate in the amount of $48,522 for
      the three months ended June 30, 2007 as compared to $69,861 for the three months
      ended June 30, 2006. The expenses include rent, office supplies, travel and
      other ordinary expenses necessary to carry out our corporate operations. No
      contractual arrangement exists between the two companies.





18




We
      recorded an expense of $2,722,184 for the net change in fair value of our
      derivatives associated with our convertible debenture and note.




**Six
      Months Ended June 30, 2007 and June 30, 2006**




Operational
      control of Interactive Nutrition International, Inc. (“INII”) was assumed by us
      on May 31, 2007. Accordingly, the results of operations for INII include only
      the one month ended June 30, 2007.





Sales
      revenue for the month of June 2007 was $1,569,341. This revenue was generated
      from sales of nutritional products from INII.





We
      had no
      leasing income for the six months ended June 30, 2007. Leasing income for the
      six months ended June 30, 2006 was $39,684. We may continue to seek leasing
      opportunities in the future, however, this is not the primary focus of
      management, or the Company’s resources. Fee income from brokerage fees earned in
      originating and selling business leases and loans was $2,965 for the six months
      ended June 30, 2007 versus $0 for the six months ended June 30, 2006.





Interest
      Income was $153,483 for the six months ended June 30, 2007 as compared to
      $172,666 for the six months ended June 30, 2006. Interest income was derived
      mainly from notes receivable relating to investments as well as interest from
      a
      debenture and notes that were subsequently traded on March 22, 2006 for stock
      in
      a Canadian subsidiary of the maker of the debentures. Dividend income was $8,469
      for the six months ended June 30, 2007 and $246,435 for the six months ended
      June 30, 2006. Dividend income is primarily derived from various investments
      in
      marketable securities. For the six months ended June 30, 2007, we recorded
      net
      trading gains from various investments in marketable securities in the amount
      of
      $12,011. For the six months ended June 30, 2006, we recorded $46,892 in net
      trading losses.





**Cost
      of goods sold, selling, general and administrative expenses and other income
      and
      expenses.**





INII





Cost
      of
      sales for our revenue in INII was $1,299,517. Cost of sales includes material,
      labor and manufacturing costs associated with the production of our
      products.





Selling,
      general and administrative expenses were $221,103 for the month of June 30,
      2007. These expenses include salaries and benefits, professional fees and other
      ordinary expenses necessary to carry out our operations.





Houston
      operations





Our
      corporate operations in Houston, Texas have not yet reached the size to benefit
      from separate office space and a dedicated staff. Our Company shares office
      space and certain administrative functions and staff with an affiliated company.
      Costs are allocated for these shared functions are based on an estimate of
      time
      usage.





Our
      Houston operating expenses were approximately $2,043,992 for the six months
      ended June 30, 2007 as compared to $699,335 for six months ended June 30, 2006.
      Approximately $890,000 of the total expenses was a one-time fee paid to an
      affiliate for past services rendered for control of INII. In addition, we
      incurred bad debt expense of $402,680 for the six months ended June 30, 2007
      and
      $0 for the six months ended June 30, 2006.





Salaries
      and Benefits were relatively consistent for the six months ended June 30, 2007
      ($190,351) as compared to the six months ended June 30, 2006
      ($182,237).




Professional
      fees were $1,045,743 for the six months ended June 30, 2007 as compared to
      $396,397 for the same period ending June 30, 2006. The difference is primarily
      a
      result of legal fees incurred for our INII litigation in the first quarter
      of
      2006 offset by the $890,000 one time fee in 2007 referred to above.




Interest
      expense was $630,734 for the six months ended June 30, 2007 and $536,188 for
      the
      six months ended June 30, 2006. Interest expense primarily relates to the
      expense associated with the $15,635,199 five percent (5%) convertible debenture
      entered into in September 2005, one month’s interest on our May 31, 2007 note
      and interest on our margin loan.





The
      Company was allocated overhead from an affiliate in the amount of $149,721
      for
      the six months ended June 30, 2007 as compared to $136,404 for the six months
      ended June 30, 2006. The expenses include rent, office supplies, travel and
      other ordinary expenses necessary to carry out our corporate operations. No
      contractual arrangement exists between the two companies.





We
      recorded an expense of $2,762,552 for the net change in fair value of our
      derivatives associated with our convertible debenture and note.





19




**Liquidity
      and Capital Resources**  ****





Operating
      Activities





We
      incurred a net loss for the six months ended June 30, 2007 in the amount of
      $5,227,127. During the six months ended June 30, 2007, our operations used
      cash
      flow in the amount of $85,906. Our
      uses
      in operating cash flow was primarily by an increase in notes receivable
      ($459,500) and an increase in prepaid expenses ($203,076). Cash flow from
      operating activities was generated primarily from a reserve on a note receivable
      ($402,680), a non-cash one time fee for services rendered in the acquisition
      of
      INII ($889,804), the change in value of our marketable securities ($732,637)
      and
      a net change in fair value of our derivatives ($2,762,552).





Investing
      Activities





We
      realized $100,000 in proceeds from the sale of assets. The asset was included
      as
      a part of our investment in INII. A receivable for this asset was not recorded
      when our original investment in INII was made because of the uncertainty of
      its
      collectability. The proceeds from the collection of this loan were charged
      to
      our investment in INII. We received cash in the amount of $609,022 from our
      subsidiary upon the acquisition of INII.





Financing
      Activities





We
      received cash in the amount of $1,070,910 as a result of the funding of our
      May
      31, 2007 note for the acquisition of INII. This amount is reserved for future
      working capital.





The
      Company had working capital in the amount of $6,059,773 at June 30, 2007.
      Included in our working capital is $1,946,221 of short term notes receivable
      and
      $362,000 in investments in marketable securities.





Our
      cash
      flows for the periods are summarized below:


Six
                  Months Ended
              
              Six
                  Months EndedJune
                  30, 2007
              
              June
                  30, 2006Net
                  cash provided by (used in) operating activities
              
              $
              (85,906
              )
              $
              394,997Net
                  cash provided by investing activities
              
              $
              709,022
              
              $
              0Net
                  cash provided by (used in) financing activities
              
              $
              1,063,419
              
              $
              (344,282
              )




Our
      cash
      increased by $1,757,508 since December 31, 2006.





Management
      believes the Company has adequate working capital and cash to be provided from
      operating activities to fund current levels of operations. We anticipate that
      our company will grow. As our business grows we believe that we will have to
      raise additional capital in the private debt and public equity markets to fund
      our investments.




**Off-Balance
      Sheet Arrangements**




Our
      Canadian subsidiary leases its building and warehouse at a current minimum
      annual cost of $272,784. The Company is also responsible for its share of
      property tax, maintenance and utility costs on the warehouse lease. The leases
      expire on April 30, 2009.




Future
      minimum payments under the building and warehouse leases described above, on
      a
      fiscal year basis are as follows:




2007
              
              $
              131,0622008
              
              
              266,4852009
              
              
              88,828$
              486,375





**Inflation**




The
      Company believes that inflation has not had a significant impact on operations
      since inception.




20





**ITEM
              **3.****
            **CONTROLS
                AND PROCEDURES**




**(A)
      Evaluation of Disclosure Controls and Procedures**




The
      Company maintains disclosure controls and procedures designed to ensure that
      information required to be disclosed in reports filed under the Securities
      Exchange Act of 1934, as amended, is recorded, processed, summarized,
      accumulated and communicated to the Company’s management, including its Chief
      Executive Officer ("CEO") and Chief Financial Officer ("CFO"), as appropriate,
      to allow timely decisions regarding required disclosure.




As
      of the
      end of the period covered by this report, the Company's management carried
      out
      an evaluation, under the supervision and with the participation of the Company's
      Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), of the
      effectiveness of the design and operation of the Company's system of disclosure
      controls and procedures pursuant to the Securities and Exchange Act, Rule
      13a-15(e) and 15d-15(e) under the Exchange Act). Based on the material
      weaknesses described herein the Company's CEO and CFO have concluded that the
      Company's disclosure controls and procedures were not effective, as of the
      date
      of that evaluation, for the purposes of recording, processing, summarizing
      and
      timely reporting of material information required to be disclosed in reports
      filed by the Company under the Exchange Act. Because of our size, the Company
      shares its accounting staff with an affiliated company and is comprised of
      its
      part-time Chief Financial Officer, controller and data entry clerk. The
      controller and data entry clerk are considered contract employees whom also
      work
      for an affiliated company as contract employees. Our CFO is also an employee
      of
      an affiliate. Because of the structure of our staff, we have a failure to
      maintain effective controls over the selection, application and monitoring
      of
      our accounting policies to assure that certain complex equity transactions
      were
      accounted for in accordance with generally accepted accounting
      principles.




**(B)
      Changes**  **in
      Internal Controls over Financial Reporting**




In
      connection with the evaluation of the Company's internal controls during the
      Company's last fiscal quarter covered by this report, the Company's CEO and
      CFO
      have determined that there were no changes to the Company's internal controls
      over financial reporting that have materially affected, or are reasonably likely
      to materially effect, the Company's internal controls over financial
      reporting.





**Material
      Weaknesses Identified**




In
      connection with the audit of our consolidated financial statements for the
      fiscal year ended December 31, 2006, our independent registered public
      accounting firm informed us that we have significant deficiencies constituting
      material weaknesses. As defined by the Public Company Accounting Oversight Board
      Auditing Standard No. 2, a material weakness is a significant control
      deficiency or a combination of significant control deficiencies that result
      in
      there being more than a remote likelihood that a material misstatement in the
      annual or interim financial statements will not be prevented or detected. The
      material weaknesses identified by the auditor during the December 31, 2005
      and
      2006 audit were the lack of segregation of duties necessary to maintain proper
      checks and balances between functions and the lack of procedures to properly
      account for non-routine transactions and preparation of certain financial
      statement disclosures in accordance with U.S. GAAP. The absence of qualified
      full time accounting personnel was a contributing factor to the problems
      identified by the auditor. The specific circumstances giving rise to the
      weaknesses include utilizing the services of contract accountants on a part
      time
      basis in the absence of internal accounting personnel.





Further,
      based on the material weaknesses described herein, we concluded that our
      disclosure controls and procedures were not effective at June 30, 2007, the
      end
      of this reporting period..





**Remediation
      Plan regarding the Material Weaknesses**





The
      Company has taken the following steps to address the specific problems
      identified by the auditors:





(1)
            Our
                affiliate has hired of a Chief Financial Officer and a contract part-time
                bookkeeper to allow us to properly implement the segregation of duties
                necessary to maintain checks and balances between accounting and
                Executive
                functions.(2)
            All
                non-routine transactions will be reviewed by our Chief Financial
                Officer and contract controller before they are
                completed.





(3)
            The
                Company will emphasize enhancement of the segregation of duties based
                on
                the limited resources the Company has, and, where practical, the
                Company
                will continue to access the cost versus benefit of adding additional
                resources that would mitigate the situation. Our Chief Financial
                Officer
                will monitor our accounting policies to assure proper accounting
                for
                financial derivatives and other unusual transactions on an ongoing
                basis.




(4)
            Subsequent
                to the end of our June 30, 2007 quarter, the Company has hired specialists
                to assist us in our endeavors to comply with Section 404 of the
                Sarbanes-Oxley Act of 2002. We hope to have this projected completed
                by
                mid fourth quarter 2007.




21




The
      Company continues its efforts to remediate control weaknesses and further
      improve and strengthen its internal control over financial reporting under
      the
      direction of the CEO and the CFO.





**PART
      II - OTHER INFORMATION**





**ITEM
      1** **.
       LEGAL PROCEEDINGS**





None





**ITEM
      2**  **.
       UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
      PROCEEDS**




None.





**ITEM
      3**  **.
       DEFAULTS UPON SENIOR SECURITIES**




None.








**ITEM
      4**  **. 
      SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS**




None.





**ITEM
      5**  **. 
      OTHER INFORMATION**




None.





**ITEM
      6.  EXHIBITS AND REPORTS ON FORM 8-K**




**(A)
      Documents filed as a part of this report.**




EXHIBIT
      31.1      Officer's Certification Pursuant to Section
      302




EXHIBIT
      32.1      Certificate pursuant to 18 U.S.C. Section 1350 as
      adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002




**(B)
      Current Reports filed on Form 8-K:**





Item
      7.01
      Regulation FD disclosure as filed on January 12, 2007 and incorporated herein
      by
      reference.





Item
      1.01 Entry
      Into Material Definitive Agreement, Item 3.02 Unregistered sales of equity
      securities and item 9.01 Financial Statements and Exhibits, as originally filed
      on June 6, 2007 and amended on August 13, 2007, and incorporated herein by
      reference.





22





**SIGNATURES**




In
      accordance with the requirements of the Exchange Act, the Company has caused
      this Quarterly Report on Form 10-QSB/A to be signed on its behalf by the
      undersigned, thereunto duly authorized.




Date:
              August 20, 2007
            
            
            Natural
                Nutrition, Inc.
              (Formerly
                CSI Business Finance, Inc.)(Registrant)/s/
                Timothy J ConnollyTimothy
                J. Connolly
              Chief
                Executive OfficerDate:
              August 20, 2007
            
            
            Natural
                Nutrition, Inc.
              (Formerly
                CSI Business Finance, Inc.)(Registrant)/s/
                Wm Chris MathersWm
                Chris Mathers
              Chief
                Financial Officer




23