**U.S.
      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**


**or**




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





**Commission
      File Number 000-25413**




**INTERNATIONAL
      IMAGING SYSTEMS, INC.**


**(Name
      of small business issuer in its charter)**




**Delaware**
            **65-0854589****(State
                or other jurisdiction**
              **of
                incorporation or organization)**
            **(I.R.S.
                Employer**
              **Identification
                No.)****31200
                Via Colinas, Suite 200**
              **Westlake
                Village, CA**
            **91362****(Address
                of principal executive offices)**
            **(Zip
                Code)**




**Issuer's
      telephone number: (818) 597-7552**





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




Indicate
      by check mark whether the registrant is an accelerated filer (as defined in
      Rule
      12b-2 of the Act).


Yes o No x




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


Yes x No o




As
      of
      July 23, 2007 there were 476,572 shares of common stock, $.001 par value, issued
      and outstanding.









**International
      Imaging Systems, Inc.**




Table
      of
      Contents




PagePART
                I -
            
            FINANCIAL
                INFORMATIONItem
                1.
            
            Financial
                Statements (Unaudited):
            3Condensed
                Consolidated Balance Sheet as of June 30, 2007
            3Condensed
                Consolidated Statements of LossesThree
                and Six months ended June 30, 2007 and 2006
            4Condensed
                Consolidated Statements of Changes in Stockholders'
                DeficitFor
                the six months ended June 30, 2007
            5Condensed
                Consolidated Statements of Cash FlowsSix
                months ended June 30, 2007 and 2006
            6Notes
                to Condensed Consolidated Financial Statements (Unaudited)
            7Item
                2.
            
            Management's
                Discussion and Analysis or Plan of Operation
            9Item
                3.
            
            Controls
                and Procedures
            13PART
                II -
            
            OTHER
                INFORMATION
            14Item
                1.
            
            Legal
                Proceedings
            14Item
                2.
            
            Unregistered
                Sales of Equity Securities and Use of Proceeds
            14Item
                3.
            
            Defaults
                Upon Senior Securities
            14Item
                4.
            
            Submission
                of Matters to a Vote of Security Holders.
            14Item
                5.
            
            Other
                Information
            14Item
                6.
            
            Exhibits
                and Reports on Form 8-K
            14




2




INTERNATIONAL
        IMAGING SYSTEMS, INC. AND SUBSIDIARIES
 (A
        Development Stage Company)
 CONDENSED
        CONSOLIDATED BALANCE SHEET
 JUNE
        30,
        2007
 (Unaudited)





AssetsCurrent
                assets:Cash
            
            $
            16,666Liabilities
                and stockholders' deficitCurrent
                liabilities:Accounts
                payable and accrued expenses:
            
            $
            17,987Total
                current liabilities
            
            
            17,987Stockholders'
                deficit:Preferred
                    stock, par value $.001 per share; 1,000,000 shares authorized,
                    162,000
                    shares issued and outstanding
            
            
            162Common
                  stock, par value $.0001 per share; 79,000,000 shares authorized,
                  476,572
                  shares issued and outstanding
            
            
            48Additional
                paid-in capital
            
            
            1,644,934Accumulated
                deficit
            
            
            (1,579,079
            )Deficit
                accumulated during the development stage
            
            
            (67,386
            )Total
                stockholders' deficit
            
            
            (1,321
            )Total
                liabilities and stockholders' deficit
            
            $
            16,666




See
        accompanying notes to unaudited condensed consolidated financial
        statements.




3


INTERNATIONAL
        IMAGING SYSTEMS, INC. AND SUBSIDIARIES
 (A
        Development Stage Company)
 CONDENSED
        CONSOLIDATED STATEMENTS OF LOSSES
 (Unaudited)


Three
                  Months endedJune 30,
              
              Six
                  Months ended June 30,
              
              Cumulative
                              Period
                            from
                              January 1, 2007
                            (date
                              of inception as
                            a
                              development stage
                            enterprise)
                              to
                            June
                              30,2007
              
              2006
              
              2007
              
              2006
              
              2007Revenue
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -General
                  and administrative expenses
              
              
              33,440
              
              
              -
              
              
              67,386
              
              
              -
              
              
              67,386Loss
                  from continuing operations
              
              
              (33,440
              )
              
              -
              
              
              (67,386
              )
              
              -
              
              
              (67,386
              )Loss
                  from discontinued operations
              
              
              -
              
              
              (51,893
              )
              
              -
              
              
              (248,907
              )
              
              -Loss
                  before provision for income taxes
              
              
              (33,440
              )
              
              (51,893
              )
              
              (67,386
              )
              
              (248,907
              )
              
              (67,386
              )Provision
                  for income taxes
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -Net
                  loss
              
              $
              (33,440
              )
              $
              (51,893
              )
              $
              (67,386
              )
              $
              (248,907
              )
              $
              (67,386
              )Basic
                  and diluted loss per share:Loss
                  from continuing operations
              
              $
              (0.07
              )
              $
              -
              
              $
              (0.17
              )
              $
              -Loss
                  from discontinued operations
              
              
              -
              
              
              (0.20
              )
              
              -
              
              
              (1.01
              )Net
                  loss per common share, basic and diluted
              
              $
              (0.07
              )
              $
              (0.20
              )
              $
              (0.17
              )
              $
              (1.01
              )Weighted
                  average shares outstanding
              
              
              476,572
              
              
              260,457
              
              
              385,776
              
              
              246,768


See
        accompanying notes to unaudited condensed consolidated financial
        statements.




4


INTERNATIONAL
        IMAGING SYSTEMS, INC. AND SUBSIDIARIES
 (A
        Development Stage Company)
 CONDENSED
        CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIT
 JANUARY
        1, 2007 (date of inception as a Development Stage Enterprise) to JUNE 30,
        2007
 (Unaudited)


Accumulated
                  DeficitAdditional
              
              Prior
                  to
              
              DuringPreferred
                  Stock
              
              Common
                  Stock
              
              Paid-in
              
              Development
              
              Development
              
              Stockholders'Shares
              
              Amount
              
              Shares
              
              Amount
              
              Capital
              
              Stage
              
              Stage
              
              DeficiencyBalance,
                  January 1, 2007
              
              
              225,000
              
              $
              225
              
              
              265,905
              
              $
              27
              
              $
              1,642,292
              
              $
              (1,579,079
              )
              $
              -
              
              $
              63,465Conversion
                  of preferred stock
              
              
              (63,000
              )
              
              (63
              )
              
              210,000
              
              
              21
              
              
              42
              
              
              -
              
              
              
              
              
              -Common
                    stock issued for accruedexpense
              
              
              -
              
              
              -
              
              
              667
              
              
              -
              
              
              2,600
              
              
              
              
              
              
              
              
              2,600Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (67,386
              )
              
              (67,386
              )Balance,
                  June 30, 2007
              
              
              162,000
              
              $
              162
              
              
              476,572
              
              $
              48
              
              $
              1,644,934
              
              $
              (1,579,079
              )
              $
              (67,386
              )
              $
              (1,321
              )


See
          accompanying notes to unaudited condensed consolidated financial
          statements.





5


INTERNATIONAL
        IMAGING SYSTEMS, INC.
 (A
        Development Stage Company)
 CONDENSED
        CONSOLIDATED STATEMENTS OF CASH FLOWS
 SIX
        MONTHS ENDED JUNE 30, 2007 AND 2006
 (Unaudited)
 
 Cumulative
                      Period
                    from
                      January 1, 2007
                    (date
                      of inception as
                    a
                      development stage
                    enterprise)
                      to
                    June
                      30,2007
              
              2006
              
              2007Cash
                  flows from operating activities:Net
                  loss
              
              $
              (67,386
              )
              $
              (248,907
              )
              $
              (67,386
              )Adjustments
                  to reconcile net loss to netcash
                  used in operating activities:Change
                  in assets and liabilities of discontinued operations
              
              
              -
              
              
              57,941
              
              
              -Stock
                  based compensation
              
              
              -
              
              
              62,500
              
              
              -Change
                  in operating assets and liabilitiesAccounts
                  payable and accrued expenses
              
              
              6,414
              
              
              -
              
              
              6,414Cash
                  used in operating activities
              
              
              (60,972
              )
              
              (128,466
              )
              
              (60,972
              )Cash
                  flows from financing activities:Repayment
                  of borrowings
              
              
              -
              
              
              (30,631
              )
              
              -Cash
                  used by financing activities
              
              
              -
              
              
              (30,631
              )
              
              -Net
                  decrease in cash
              
              
              (60,972
              )
              
              (159,097
              )
              
              (60,972
              )Cash,
                  beginning of period
              
              
              77,638
              
              
              187,502
              
              
              77,638Cash,
                  end of period
              
              $
              16,666
              
              $
              28,405
              
              $
              16,666Supplemental
                  cash flow information:Cash
                  paid for interest
              
              $
              -
              
              $
              1,011Cash
                  paid for income taxes
              
              $
              -
              
              $
              -Non-Cash
                  Financing Activities:Payment
                  of accrued expense with common stock
              
              $
              2,600
              
              $
              -Conversion
                  of notes payable to equity
              
              
              -
              
              
              430,000




See
        accompanying notes to unaudited condensed consolidated financial
        statements.
  6


**INTERNATIONAL
      IMAGING SYSTEMS, INC.**


**AND
      SUBSIDIARIES**




**(A
      Development Stage Company)**





**NOTES
      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**




**JUNE
      30, 2007 AND 2006**


**(Unaudited)**




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




**Nature
      of Operations**





International
      Imaging Systems, Inc. (“we” *,
      “us”,* “ *our
      company* ”, *“our”* or *“IISY”* ) was
      formed under the laws of the State of Delaware in 1998. Through our wholly-owned
      subsidiary, Advanced Staffing International, Inc., we were principally engaged
      in the employee leasing business.





On
      September 19, 2006, certain of our shareholders sold 150,000 shares (56.4%)
      of
      our common stock to a group of investors for $405,000 cash. The sale was
      accompanied by the resignation and replacement of our officers and directors.
      We
      are currently a development stage company, as defined by Statement of Financial
      Accounting Standards (SFAS”) No. 7 ("SFAS No. 7")




As
      of
      January 1, 2007 we are pursuing an acquisition strategy whereby we will seek
      to
      acquire businesses with a history of operating revenues in markets that provide
      room for growth. We are engaged in identifying, investigating and, if warranted,
      acquiring companies that will enhance revenues and increase shareholder value.
      In the event that our limited financial resources prove to be insufficient
      to
      implement our acquisition strategy, we will be required to seek additional
      financing, through either equity or debt financing.




**Basis
      of Presentation**




The
      consolidated financial statements include the accounts of the Company and its
      wholly-owned subsidiaries. Intercompany transactions and accounts have been
      eliminated.




The
      accompanying unaudited condensed consolidated financial statements as of June
      30, 2007 and for the three and six month periods ended June 30, 2007 and 2006
      and from reestablishment of development stage (January 1, 2007) to June 30,
      2007
      have been prepared by IISY pursuant to the rules and regulations of the
      Securities and Exchange Commission, including Form 10-QSB and Regulation S-B.
      The information furnished herein reflects all adjustments (consisting of normal
      recurring accruals and adjustments), which are, in the opinion of management,
      necessary to fairly present the operating results for the respective periods.
      Certain information and footnote disclosures normally present in annual
      financial statements prepared in accordance with accounting principles generally
      accepted in the United States of America have been omitted pursuant to such
      rules and regulations. We believe that the disclosures provided are adequate
      to
      make the information presented not misleading. These financial statements should
      be read in conjunction with the audited financial statements and explanatory
      notes for the year ended December 31, 2006 as disclosed in our 10-KSB for that
      year as filed with the SEC, as it may be amended.




The
      results of the six months ended June 30, 2007 are not necessarily indicative
      of
      the results to be expected for the pending full year ending December 31,
      2007.




**Use
      of Estimates**





The
      preparation of financial statements in conformity with accounting principals
      generally accepted in the United States of America requires management to make
      estimates and assumptions that affect the amounts reported in the consolidated
      financial statements and accompanying disclosures. Although these estimates
      are
      based on management's best knowledge of current events and actions the Company
      may undertake in the future, actual results may differ from those
      estimates.





**Going
      Concern**





The
      financial statements have been prepared on a going concern basis, and do not
      reflect any adjustments related to the uncertainty surrounding our recurring
      losses or accumulated deficit





We
      currently have no revenue source and are incurring losses. These factors raise
      substantial doubt about our ability to continue as a going concern.




7





We
      will
      pursue an acquisition strategy whereby we will seek to acquire businesses with
      a
      history of operating revenues in markets that provide room for growth. We are
      engaged in identifying, investigating and, if warranted, acquiring companies
      that will enhance revenues and increase shareholder value. In the event that
      our
      limited financial resources prove to be insufficient to implement our
      acquisition strategy, we will be required to seek additional financing, through
      either equity or debt financing.





**Loss
      per Share**





We
      use
      SFAS No. 128, “Earnings Per Share” for calculating the basic and diluted
      loss per share. We compute basic loss per share by dividing net loss and net
      loss attributable to common shareholders by the weighted average number of
      common shares outstanding. Diluted loss per share is computed similar to basic
      loss per share except that the denominator is increased to include the number
      of
      additional common shares that would have been outstanding if the potential
      shares had been issued and if the additional shares were dilutive. Common
      equivalent shares are excluded from the computation of net loss per share if
      their effect is anti-dilutive. There were 540,000 common share equivalents
      at
      June 30, 2007 and none at June 30, 2006.





**Recent
      Accounting Pronouncements**





In
      February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for
      Financial Assets and Financial Liabilities - Including an Amendment of FASB
      Statement No. 115.” This statement permits entities to choose to measure many
      financial instruments and certain other items at fair value. Most of the
      provisions of SFAS No. 159 apply only to entities that elect the fair value
      option. However, the amendment to SFAS No. 115, “Accounting for Certain
      Investments in Debt and Equity Securities,” applies to all entities with
      available-for-sale and trading securities. SFAS No. 159 is effective as of
      the
      beginning of an entity’s first fiscal year that begins after November 15, 2007.
      Early adoption is permitted as of the beginning of a fiscal year that begins
      on
      or before November 15, 2007, provided the entity also elects to apply the
      provision of SFAS No. 157, “Fair Value Measurements.” The adoption of this
      statement is not expected to have a material effect on the Company’s financial
      statements.




**NOTE
      B - STOCK COMPENSATION PLAN -**




In
      March
      2006, we issued 8,333 common shares, valued at $62,500, in connection with
      a
      one-year management consulting agreement.




**NOTE
      C - STOCKHOLDERS’ EQUITY**





Our
      board
      of directors and the holders of a majority of the shares entitled to vote
      thereon adopted resolutions approving the amendments of our certificate of
      incorporation to (i) increase our authorized shares from 30 million to
      80 million and the number of our authorized shares of common stock from 29
      million to 79 million; and (ii) reverse split our outstanding Common Stock
      on
      the basis of 1 post-split share for 30 pre-split shares. Stockholders of a
      majority of outstanding shares approved the increase of authorized common stock
      and the reverse split of our common stock by written consent on March 14,
      2007.





The
      amendments of our certificate of incorporation to increase our authorized shares
      of common stock and reverse split our outstanding common stock became effective
      on June 13, 2007. Also, the par value of our common shares was changed to
      $0.0001 per share.  All share and per share amounts have been retroactively
      restated to reflect this reverse split.




During
      March 2007, we issued 210,000 shares of common stock upon conversion of 63,000
      shares of our preferred stock.




During
      March, 2007, we issued 667 shares of common stock to our chief financial officer
      as payment of accrued compensation valued at $2,600.




In
      March
      2006, we issued 8,333 common shares, valued at $62,500, in connection with
      a
      one-year management consulting agreement.




During
      the first quarter of 2006, we issued 28,667 shares of common stock in
      satisfaction of 6% exchangeable notes due to shareholders of
      $430,000.




**NOTE
      D - LOANS PAYABLE - SHAREHOLDERS -**




Loans
      payable to shareholders consisted of non-interest bearing working capital
      advances, due on demand. During the first quarter of 2006, we issued 860,000
      shares of common stock in satisfaction of debt of $430,000.





Interest
      expense amounted to $1,011 for the six months ended June 30, 2006.




**NOTE
      E - DISCONTINUED OPERATIONS**




As
      a
      result of the change of control described in Note A, we have decided not to
      continue with our employee leasing business. As of January 1, 2007 we are
      pursuing an acquisition strategy whereby we will seek to acquire businesses
      with
      a history of operating revenues in markets that provide room for growth. All
      prior operations have been presented as discontinued operations. Prior year
      revenue which is now included as a part of discontinued operations was $145,889
      for the six months ended June 30, 2006. There was no revenue during the three
      month period ended June 30, 2006.




8




**ADVISEMENT**





Unless
      the context requires otherwise, “ *International
      Imaging Systems* ”,
“ *the
      company* ”,
“ *we* ”,
“ *us* ”,
“ *our* ”
and
      similar terms refer to International Imaging Systems, Inc. Our common stock,
      par
      value $.0001 per share is commonly referred to in this quarterly report as
      our “ *common
      shares* ”.
       The information in this quarterly report is current as of the date of this
      quarterly report (June 30, 2007), unless another date is specified.





We
      prepare our interim financial statements in accordance with United States
      generally accepted accounting principles.  Our financial condition and
      results of operations for the six-month interim period ended June 30, 2007
      are not necessarily indicative of our prospective financial condition and
      results of operations for the pending full fiscal year ended December 31, 2007.
       The interim financial statements presented in this quarterly report as
      well as other information relating to our company contained in this quarterly
      report should be read in conjunction and together with any reports, statements
      and information filed with the SEC.





**FORWARD
      LOOKING STATEMENTS**





In
      this
      quarterly report we make a number of statements, referred to as “forward-looking
      statements”, within the meaning of Section 27A of the Securities Act of 1933 and
      Section 21E of the Securities Exchange Act of 1934 (the "Exchange Act"), which
      are intended to convey our expectations or predictions regarding the occurrence
      of possible future events or the existence of trends and factors that may impact
      our future plans and operating results. These forward-looking statements are
      derived, in part, from various assumptions and analyses we have made in the
      context of our current business plan and information currently available to
      use
      and in light of our experience and perceptions of historical trends, current
      conditions and expected future developments and other factors we believe are
      appropriate in the circumstances. You can generally identify forward looking
      statements through words and phrases such as *“believe”,
      “expect”, “seek”, “estimate”, “anticipate”, “intend”, “plan”, “budget”,
“project”, “may likely result”, “may be”, “may continue”* and
      other similar expressions.




Each
      forward-looking statement should be read in context with and in understanding
      of
      the various other disclosures concerning our company and our business made
      elsewhere in this report as well as our public filings with the Securities
      and
      Exchange Commission. You should not place undue reliance on any forward-looking
      statement as a prediction of actual results or developments. We are not
      obligated to update or revise any forward-looking statements contained in this
      report or any other filing to reflect new events or circumstances unless and
      to
      the extent required by applicable law.





**MANAGEMENT’S
      DISCUSSION AND ANALYSIS OF**


**FINANCIAL
      CONDITION, RESULTS OF OPERATIONS AND PLAN OF OPERATION**




**Overview**




As
      of
      September 19, 2006, our board of directors determined that the implementation
      of
      the Company's business plan prior to the change in control was no longer
      financially feasible. As of January 1, 2007 we are pursuing an acquisition
      strategy, whereby we will seek to acquire undervalued businesses with a history
      of operating revenues in markets that provide room for growth ("Acquisition
      Strategy"). We will engage in identifying, investigating and, if warranted,
      acquiring companies that will enhance our revenues and increase shareholder
      value.




Our
      Acquisition Strategy is focused on pursuing a strategy of growth by acquiring
      undervalued businesses with a history of operating revenues. We will utilize
      several criteria to evaluate prospective acquisitions including whether the
      business to be acquired (1) is an established business with viable services
      or
      products, (2) has an experienced and qualified management team, (3) has room
      for
      growth and/or expansion into other markets, (4) is accretive to earnings, (5)
      offers the opportunity to achieve and/or enhance profitability, and (6)
      increases shareholder value.




**Critical
      Accounting Policies**





The
      preparation of our consolidated financial statements in conformity with
      accounting principles generally accepted in the United States requires us to
      make estimates and judgments that affect our reported assets, liabilities,
      revenues, and expenses, and the disclosure of contingent assets and liabilities.
      We base our estimates and judgments on historical experience and on various
      other assumptions we believe to be reasonable under the circumstances. Future
      events, however, may differ markedly from our current expectations and
      assumptions. While there are a number of significant accounting policies
      affecting our consolidated financial statements; we believe the following
      critical accounting policies involve the most complex, difficult and subjective
      estimates and judgments:




9




Use
      of
      Estimates - These financial statements have been prepared in accordance with
      accounting principles generally accepted in the United States of America and,
      accordingly, require management to make estimates and assumptions that affect
      the reported amounts of assets and liabilities at the date of the financial
      statements and the reported amounts of revenues and expenses during the
      reporting period. Specifically, our management has estimated our net operating
      loss for tax purposes. Actual results could differ from those
      estimates.




Cash
      and
      Equivalents - We maintain our cash in bank deposit accounts, which at times,
      may
      exceed federally insured limits. We have not experienced any losses in such
      account.




**Going
      Concern**




We
      are
      currently in the process of implementing our new business plan, focusing on
      our
      acquisition strategy. At present, we have sufficient capital on hand to fund
      our
      operations only through September of 2007. There can be no assurance that upon
      implementing our new business plan, we will be successful or that we will start
      producing sufficient revenues to maintain our operations. The foregoing matters
      raise substantial doubt about our ability to continue as a going concern.




**Results
      of Operations**




**Revenue**




We
      have
      no revenue from continuing operations for the three or six month periods ended
      June 30, 2007 or 2006. As a result of the decision to implement a new business
      plan, we have reclassified prior period operations as discontinued operations.
      Prior year revenue which is now included as a part of discontinued operations
      was $145,889 for the six month period ended June 30, 2006. There was no revenue
      during the three month period ended June 30, 2006.





**General
      and Administrative Expenses**




General
      and administrative expenses were $33,440 and $67,386 for the three and six
      month
      periods ended June 30, 2007, respectively. Prior year general and administrative
      expenses which are now included as a part of discontinued operations were
      $51,429 and $363,378 for the three and six month periods ended June 30, 2006,
      respectively. Current period general and administrative expenses consist
      primarily of professional fees.




**Plan
      of Operation**




We
      are
      pursuing an Acquisition Strategy, whereby we will seek to acquire undervalued
      businesses with a history of operating revenues in markets that provide room
      for
      growth. We will primarily engage in identifying, investigating and, if
      investigation warrants, acquiring companies that will enhance our revenues
      and
      increase shareholder value. Our Acquisition Strategy is focused on pursuing
      a
      strategy of growth by acquiring undervalued businesses with a history of
      operating revenues. We will utilize several criteria to evaluate prospective
      acquisitions including whether the business to be acquired (1) is an established
      business with viable services or products, (2) has an experienced and qualified
      management team, (3) has room for growth and/or expansion into other markets,
      (4) is accretive to earnings, (5) offers the opportunity to achieve and/or
      enhance profitability, and (6) increases shareholder value.




**Liquidity
      and Capital Resources**




As
      of
      June 30, 2007 we had a working capital deficit of $1,321. While our cash on
      hand
      of $16,666 will satisfy our immediate financial needs, it may not be sufficient
      to provide us with sufficient capital to maintain our business and to finance
      acquisitions. Accordingly, within the next 3 to 6 months, management anticipates
      needing to need to raise additional funds in order to continue operating. There
      can be no assurances that we will be able to obtain additional funds if and
      when
      needed.





Additionally,
      as we are considered a “shell” or “blank check” company, purchasers of our
      securities cannot currently rely on Rule 144 promulgated under the Securities
      Act with regard to the resale of their shares. Accordingly, any financing in
      the
      form of equity may be deeply discounted to compensate the investors for the
      added risk and inability to rely on Rule 144.




**Recent
      Accounting Pronouncements**





In
      February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for
      Financial Assets and Financial Liabilities - Including an Amendment of FASB
      Statement No. 115.” This statement permits entities to choose to measure many
      financial instruments and certain other items at fair value. Most of the
      provisions of SFAS No. 159 apply only to entities that elect the fair value
      option. However, the amendment to SFAS No. 115, “Accounting for Certain
      Investments in Debt and Equity Securities,” applies to all entities with
      available-for-sale and trading securities. SFAS No. 159 is effective as of
      the
      beginning of an entity’s first fiscal year that begins after November 15, 2007.
      Early adoption is permitted as of the beginning of a fiscal year that begins
      on
      or before November 15, 2007, provided the entity also elects to apply the
      provision of SFAS No. 157, “Fair Value Measurements.” The adoption of this
      statement is not expected to have a material effect on the Company’s financial
      statements.




10




**UNCERTAINTIES
      AND OTHER RISK FACTORS THAT**


**MAY
      AFFECT OUR FUTURE RESULTS AND FINANCIAL CONDITION**





We
      have
      described below a number of uncertainties and risks which, in addition to
      uncertainties and risks presented elsewhere in this quarterly report, may
      adversely affect our business, operating results and financial condition.
 The uncertainties and risks enumerated below as well as those presented
      elsewhere in this quarterly report should be considered carefully in evaluating
      our company and our business and the value of our securities.





***We
      have Limited Resources***





We
      have
      limited resources. During 2006, we lost our sole customer and are now pursuing
      an acquisition strategy, whereby we will seek to acquire undervalued businesses
      with a history of operating revenues in markets that provide room for growth.
      Other than nominal interest income, we will only derive revenues through the
      acquisition of a target company. There can be no assurance that any target
      company, at the time of the Company's consummation of an acquisition of the
      target, or at any time thereafter, will derive any material revenues from its
      operations or operate on a profitable basis. Based on our limited resources,
      we
      may not be able to effectuate our business plan and consummate any additional
      acquisitions. There can be no assurance that we will have sufficient financial
      resources to permit the achievement of our business objectives.





***We
      May Not be Able to Continue as Going Concern***





Based
      on
      our limited operations, lack of revenue and relatively minimal assets there
      can
      be no assurance that we will be able to continue as a going concern or complete
      a merger, acquisition or other business combination.





***We
      Will Need Additional Financing in Order to Execute Our Business Plan and it
      may
      be Extremely Expensive***





We
      will
      be entirely dependent upon our limited available financial resources to
      implement our acquisition strategy. We cannot ascertain with any degree of
      certainty the capital requirements for the successful execution of our
      acquisition strategy. In the event that our limited financial resources prove
      to
      be insufficient to implement our acquisition strategy, we will be required
      to
      seek additional financing. Also, in the event of the consummation of an
      acquisition, we may require additional financing to fund the operations or
      growth of the target. Additionally, as we are considered a “shell” or “blank
      check” company, purchasers of our securities cannot currently rely on Rule 144
      promulgated under the Securities Act with regard to the resale of their shares.
      Accordingly, any financing in the form of equity may be deeply discounted to
      compensate the investors for the added risk and inability to rely on Rule 144.
      Depending on such discount, our current shareholders may be substantially
      diluted.





***Additional
      Financing May Not Be Available to Us***





There
      can
      be no assurance that additional financing will be available on acceptable terms,
      or at all. To the extent that additional financing proves to be unavailable
      when
      needed, we would, in all likelihood, be compelled to abandon plans of further
      acquisitions, and would have minimal capital remaining to pursue other targets.
      Our inability to secure additional financing, if needed, could also have a
      material adverse effect on our continued development or growth. We have no
      arrangements with any bank or financial institution to secure additional
      financing and there can be no assurance that any such arrangement, if required
      or otherwise sought, would be available on terms deemed to be commercially
      acceptable to us and in our best interests.





***Competition
      for Acquisitions***





We
      expect
      to encounter intense competition from other entities having business objectives
      similar to ours. Many of these entities, including venture capital firms,
      partnerships and corporations, blind pool companies, large industrial and
      financial institutions, small business investment companies and wealthy
      individuals, are well-established and have extensive experience in connection
      with identifying and effecting acquisitions directly or through affiliates.
      Many
      of these competitors possess greater financial, technical, human and other
      resources than us and there can be no assurance that we will have the ability
      to
      compete successfully. Our financial resources will be limited in comparison
      to
      those of many of our competitors. This inherent competitive limitation may
      compel us to select certain less attractive acquisition prospects. There can
      be
      no assurance that such prospects will permit us to achieve our stated business
      objectives.




11





***We
      May Be Subject to Uncertainty in the Competitive Environment of a
      Target***





In
      the
      event that we succeed in completing an acquisition, we will, in all likelihood,
      become subject to intense competition from competitors of the target. In
      particular, certain industries which experience rapid growth frequently attract
      an increasingly large number of competitors, including competitors with greater
      financial, marketing, technical, human and other resources than the initial
      competitors in the industry. The degree of competition characterizing the
      industry of any prospective target cannot presently be ascertained. There can
      be
      no assurance that, subsequent to a consummation of an acquisition, we will
      have
      the resources to compete effectively in the industry of the target, especially
      to the extent that the target is in a high growth industry.





***We
      May Pursue an Acquisition With a Target Operating Outside the United States:
      Special Additional Risks Relating to Doing Business in a Foreign
      Country***





We
      may
      effectuate an acquisition with a target whose business operations or even
      headquarters, place of formation or primary place of business are located
      outside the United States. In such event, we may face the significant additional
      risks associated with doing business in that country. In addition to the
      language barriers, different presentations of financial information, different
      business practices, and other cultural differences and barriers that may make
      it
      difficult to evaluate such a target, ongoing business risks may result from
      the
      internal political situation, uncertain legal systems and applications of law,
      prejudice against foreigners, corrupt practices, uncertain economic policies
      and
      potential political and economic instability that may be exacerbated in various
      foreign countries.





***John
      Vogel, our CEO, is Critical to Our Future Success***





Our
      ability to successfully carry out our business plan and to consummate additional
      acquisitions will be dependent upon the efforts of Mr. Vogel. Notwithstanding
      the significance of Mr. Vogel, we have not obtained any "key man" life insurance
      on his life. The loss of the services of Mr. Vogel would have a material adverse
      effect on our ability to successfully achieve our business objectives. If
      additional personnel are required, there can be no assurance that we will be
      able to retain such necessary additional personnel.





***There
      Exist Conflicts of Interest Relating to Mr. Vogel's Time Commitment to
      Us***





Mr.
      Vogel
      is not required to commit his full time to our affairs. Mr. Vogel will have
      conflicts of interest in allocating management time among various business
      activities. As a result, the consummation of an acquisition may require a
      greater period of time than if Mr. Vogel devoted his full time to our affairs.
      However, Mr. Vogel will devote such time as he deems reasonably necessary to
      carry out our business and affairs, including the evaluation of potential
      targets and the negotiation and consummation of acquisitions and, as a result,
      the amount of time devoted to our business and affairs may vary significantly
      depending upon, among other things, whether we have identified a target or
      are
      engaged in active negotiation and consummation of an acquisition.




***There
      Exist Risks to Stockholders Relating to Dilution***





On
      March
      14, 2007, a majority of our common shareholders approved a reverse stock split
      of up to 45 to 1 as well as an amendment to our articles of incorporation
      resulting in an increase in our authorized shares. Pursuant to the shareholder
      approval, our board of directors set the reverse split ratio of 30 to 1
      effective June 13, 2007. As a result of these actions, we are authorized to
      issue 79,000,000 common shares and 1,000,000 “blank check” preferred shares. As
      of the date of this report, there are 476,572 common shares issued and
      outstanding and an additional 540,000 common shares reserved for issuance upon
      the conversion of currently outstanding preferred shares. Accordingly, we will
      be entitled to issue up to 77,983,428 additional common shares. Our board
      may generally issue these common shares, or grant options or warrants to
      purchase those shares, without further approval by our shareholders based upon
      such factors as our board of directors may deem relevant at that time. It is
      likely that we will be required to issue a large amount of additional securities
      to raise capital to further our development and business plans. It is also
      likely that we will be required to issue a large amount of additional securities
      to directors, officers, employees and consultants as compensatory grants in
      connection with their services. We cannot give you any assurance that we will
      not issue additional shares, or options or warrants to purchase those shares,
      under circumstances we may deem appropriate at the time.





***The
      Uncertain Structure of an Acquisition May Result in Risks Relating to the Market
      for Our Common Stock***





We
      may
      form one or more subsidiary entities to effect an acquisition and may, under
      certain circumstances, distribute the securities of subsidiaries to our
      stockholders. There can be no assurance that a market would develop for the
      securities of any subsidiary distributed to stockholders or, if a market were
      to
      develop, no assurances as to the prices at which such securities might
      trade.





***We
      Expect to Pay No Cash Dividends***





We
      do not
      expect to pay dividends to the holders of common stock. The payment of
      dividends, if any, will be contingent upon our revenues and earnings, if any,
      capital requirements, and general financial condition. The payment of any
      dividends will be within the discretion of our Board of Directors. We presently
      intend to retain all earnings, if any, to implement our business plan;
      accordingly, the Board of Directors does not anticipate declaring any dividends
      to the holders of common stock in the foreseeable future.




12





***Indemnification
      of Officers and Directors***





Our
      Certificate of Incorporation provides for the indemnification of our officers
      and directors to the fullest extent permitted by the laws of the State of
      Delaware. It is possible that the indemnification obligations imposed under
      these provisions could result in a charge against our earnings, if any, and
      thereby affect the availability of funds for other uses.





***Taxation
      Considerations May Impact the Structure of an Acquisition and Post-merger
      Liabilities***





Federal
      and state tax consequences will, in all likelihood, be major considerations
      for
      us in consummating an acquisition. The structure of an acquisition or the
      distribution of securities to stockholders may result in taxation of us, the
      target or stockholders. Typically, these transactions may be structured to
      result in tax-free treatment to both companies, pursuant to various federal
      and
      state tax provisions. We intend to structure any acquisition so as to minimize
      the federal and state tax consequences to both the us and the target. Management
      cannot assure that an acquisition will meet the statutory requirements for
      a
      tax-free reorganization, or that the parties will obtain the intended tax-free
      treatment upon a transfer of stock or assets. A non-qualifying reorganization
      could result in the imposition of both federal and state taxes, which may have
      an adverse effect on both parties to the transaction.





***We
      May Be Deemed an Investment Company and Subjected to Related
      Restrictions***





The
      regulatory scope of the Investment Company Act of 1940, as amended (the
      "Investment Company Act"), which was enacted principally for the purpose of
      regulating vehicles for pooled investments in securities, extends generally
      to
      companies engaged primarily in the business of investing, reinvesting, owning,
      holding or trading in securities. The Investment Company Act may, however,
      also
      be deemed to be applicable to a company which does not intend to be
      characterized as an investment company but which, nevertheless, engages in
      activities which may be deemed to be within the definitional scope of certain
      provisions of the Investment Company Act. We believe that our anticipated
      principal activities, which will involve acquiring control of an operating
      company, will not subject us to regulation under the Investment Company Act.
      Nevertheless, there can be no assurance that at some future point we will not
      be
      deemed to be an investment company. If we are deemed to be an investment
      company, we may become subject to certain restrictions relating to our
      activities, including restrictions on the nature of our investments and the
      issuance of securities. In addition, the Investment Company Act imposes certain
      requirements on companies deemed to be within its regulatory scope, including
      registration as an investment company, adoption of a specific form of corporate
      structure and compliance with certain burdensome reporting, record keeping,
      voting, proxy, disclosure and other rules and regulations. In the event of
      the
      characterization of us as an investment company, our inability to satisfy such
      regulatory requirements, whether on a timely basis or at all, would, under
      certain circumstances, have a material adverse effect on us.





**CONTROLS
      AND PROCEDURES**




Item
      3.
      Controls and Procedures.




Disclosure
      controls and procedures are controls and other procedures that are designed
      to
      ensure that information required to be disclosed by us in the reports that
      we
      file or submit under the Exchange Act is recorded, processed, summarized and
      reported, within the time periods specified in the Securities and Exchange
      Commission's rules and forms.




Based
      on
      their evaluation of the Company's disclosure controls and procedures (as defined
      in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the
      period covered by this quarterly report on Form 10-QSB, and the interim period
      up to the date of filing this report, the Company's Chief Executive Officer
      and
      Chief Financial Officer have concluded that as of the end of the period covered
      by this report and the interim period up to the date of filing the report the
      Company's disclosure controls and procedures are designed to ensure that
      information required to be disclosed by the Company in the reports that it
      files
      or submits under the Exchange Act is recorded, processed, summarized and
      reported within the time periods specified in the SEC's rules and forms and
      are
      operating in an effective manner. Our officers also concluded that our
      disclosure controls and procedures are effective to ensure that such information
      is accumulated and communicated to our management, including our principal
      executive and principal financial officer, to allow timely decisions regarding
      required disclosures.




The
      Chief
      Executive Officer and Chief Financial Officer have also concluded that there
      were no changes in the Company's internal controls or in other factors that
      have
      materially affected, or are reasonably likely to materially affect, the
      Company's internal control over financial reporting.




13




**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.**





On
      March
      14, 2007, a majority of our common stockholders authorized: (i) up to a 45
      to 1
      reverse split of our shares; and (ii) the amendment of our articles of
      incorporation. We hereby incorporate by reference the information regarding
      these actions contain in our amended Information Statement Pursuant to Section
      14(c) as filed with the Securities and Exchange Commission on May 3,
      2007.





**Item
      5.**  **Other
      Information.**





None




**Item
      6.  Exhibits.**




The
      following exhibits are hereby filed as part of this Quarterly Report on Form
      10-QSB or incorporated by reference.





Exhibit
              Number:
            
            Description3.1(3)
            
            Certificate
                of Amendment filed on June 11, 20073.1(4)
            
            Certificate
                of Correction filed on July 24, 200731.1
            
            Certification
                of the Chief Executive Officer pursuant to Rule 13a-14(a) and Rule
                15d-14(a) of the Securities Exchange Act, as amended31.2
            
            Certification
                of the Chief Financial Officer pursuant to Rule 13a-14(a) and Rule
                15d-14(a) of the Securities Exchange Act, as
                amended




32.1
            
            Certification
                of the Chief Executive Officer a Pursuant to 18 U.S.C. 1350, as adopted
                pursuant to Section 906 of the Sarbanes-Oxley Act of
                200232.2
            
            Certification
                of the Chief Financial Officer Pursuant to 18 U.S.C. 1350, as adopted
                pursuant to Section 906 of the Sarbanes-Oxley Act of
                2002





14




**SIGNATURES**




In
      accordance with the requirements of the Securities Exchange Act of 1934, the
      Registrant has caused this report to be signed by the undersigned hereunto
      duly
      authorized.




**International
                Imaging Systems, Inc.**Dated:  August
                3, 2007
            
            /s/
                John VogelChief
                Executive Officer /s/
                Robert ScherneChief
                Financial Officer(Principal
                Accounting Officer)


15