U.S.
Securities and Exchange Commission


Washington,
D.C. 20549





____________________


FORM
10-Q


____________________




(Mark
One)


x  Quarterly
Report Pursuant to Section 13 or 15(d) of


the
Securities Exchange Act of 1934





For the
quarterly period ended March 31, 2002.





o  Transition
Report Pursuant to Section 13 or 15(d)


of
the Securities Exchange Act





For the
transition period from N/A to N/A


____________________





Commission
File Number: 1-13134


____________________


American
Nortel Communications, Inc.


(Name of
small business issuer as specified in its charter)





Nevada
            87-0507851State
      of Incorporation
            Employer
      Identification No.





7975
North Hayden Road, Suite D-333


Scottsdale,
AZ 85258


(Address
of principal executive offices)


(480)
945-1266


(Issuer’s
telephone number)





Securities
registered under Section 12(b) of the Exchange Act:


None


Securities
registered under Section 12(g) of the Exchange Act:


Common
Stock, $0.001 par value per share


(Title
of Class)





Indicate
by check mark whether the Registrant (1) has filed all reports required by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 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   ̈





Indicate
by check mark whether the Registrant is a large accelerated filer, an
accelerated filer, or a non–accelerated filer. See definition of “accelerated
filer and large accelerated filer” in Rule 12b–2 of the Exchange Act. (Check
one):





Large
      accelerated filer   ̈
            Accelerated
      filer   ̈
            Non–Accelerated
      filer   ̈
            Small
      Business Issuer  x





Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b–2 of the Exchange Act).  Yes  ̈    No  x


Transitional
Small Business Disclosure Format (check one): Yes  No x


Indicate
the number of shares outstanding of each of the issuer’s classes of common
stock, as of the latest practicable date.




Class
            
            Outstanding
      at  July 3, 2008Common
      stock,  No par value
            
            17,531,780













AMERICAN NORTEL COMMUNICATIONS, INC.


INDEX
TO FORM 10-Q FILING


FOR
THE THREE AND NINE MONTHS ENDED MARCH 31, 2002





TABLE
OF CONTENTS
 
 PART
I
 FINANCIAL INFORMATION
              PAGEPageNoPART
      I - FINANCIAL INFORMATIONItem 1.
              Condensed Financial Statements (unaudited)Condensed Balance Sheets
              3Condensed Statements of Income
              4Condensed Statement of Cash Flows
              5Notes to Condensed Financial Statements
              6Item 2.
              Management Discussion & Analysis of Financial Condition
      and Results of Operations
              9Item 3
              Quantitative and Qualitative Disclosures About Market
      Risk
              16Item 4.
              Controls and Procedures
              16PART II - OTHER
      INFORMATIONItem 1.
              Legal Proceedings
              17Item 1A
              Risk Factors
              17Item 2.
              Unregistered Sales of Equity Securities and Use of
      Proceeds
              18Item 3.
              Defaults Upon Senior Securities
              19Item 4.
              Submission of Matters to a Vote of Security
      Holders
              19Item 5
              Other information
              19Item 6.
              Exhibits
              19


CERTIFICATIONSExhibit
      31 – Management certificationExhibit
      32 – Sarbanes-Oxley Act





2
 Table of Contents




AMERICAN NORTEL COMMUNICATIONS, INC.CONDENSED
      BALANCES SHEETSASSETS:March
      31, 2002
            
            
            June
      30, 2001(unaudited)CURRENT
      ASSETSCash
            
            $
            362,219
            
            
            $
            219,816Accounts
      receivables - net
            
            
            666,704
            
            
            
            2,153,652Investment
      in marketable securities
            
            
            
            
            
            
            3,221,470Deferred
      income taxes
            
            
            
            
            
            
            295,229Total
      current assets
            
            
            1,028,923
            
            
            
            5,890,167PROPERTY
      AND EQUIPMENT, net
            
            
            12,792
            
            
            
            23,592Note
      receivable affiliates
            
            
            29,192
            
            
            
            32,982Investment
      in unconsolidated subsidiary
            
            
            568,600
            
            
            
            165,282Other
      assets
            
            
            
            
            
            
            6,667TOTAL
      ASSETS
            
            $
            1,639,507
            
            
            $
            6,118,690LIABILITIES
      AND STOCKHOLDERS' EQUITYCURRENT
      LIABILITIES:Accounts
      payable
            
            $
            542,240
            
            
            $
            280,644Accrued
      liabilities
            
            
            -
            
            
            
            259,167Disputed
      claims
            
            
            -
            
            
            
            339,101Notes
      payable affiliate
            
            
            
            
            
            
            50,000Factoring
      arrangement
            
            
            
            
            
            
            237,806Income
      taxes payable
            
            
            
            
            
            
            396,431Total
      current liabilities
            
            
            542,240
            
            
            
            1,563,149TOTAL
      LIABILITIES
            
            
            542,240
            
            
            
            1,563,149COMMITMENT
      AND CONTINGENCIES
            
            
            -
            
            
            
            -STOCKHOLDERS'
      EQUITYCommon
      stock, no par value, 50,000,000 shares authorized, 15,920,785 and
      15,510,643 issued and outstanding as of March 31, 2002 and June 30, 2001,
      respectively
            
            
            22,134,402
            
            
            
            21,980,202Unrealized
      gain on investments held for sale
            
            
            
            
            
            
            15,201Paid-in
      capital
            
            
            51,795
            
            
            
            51,795Treasury
      stock
            
            
            (759,773
            )
            
            
            (759,773
            )Accumulated
      deficit
            
            
            (20,329,157
            )
            
            
            (16,731,884
            )Total
      stockholders' equity
            
            
            1,097,267
            
            
            
            4,555,541TOTAL
      LIABILITIES AND STOCKHOLDERS' EQUITY
            
            $
            1,639,507
            
            
            $
            6,118,690





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





3
 Table of Contents








AMERICAN NORTEL COMMUNICATIONS, INC.CONDENSED
      STATEMENT OF OPERATIONSFOR
      THE THREE AND NINE MONTHS ENDED MARCH 31, 2002 AND 2001Three
      Months Ended
            
            
            Nine
      Months Ended2002
            
            
            2001
            
            
            2002
            
            
            2001(unaudited)
            
            
            (unaudited)
            
            
            (unaudited)
            
            
            (unaudited)REVENUESAirtime
      Income
            
            
            891,704
            
            
            $
            1,859,173
            
            
            $
            2,930,553
            
            
            $
            6,967,147891,704
            
            
            
            1,859,173
            
            
            
            2,930,553
            
            
            
            6,967,147COST
      OF SERVICES
            
            
            393,661
            
            
            
            1,314,758
            
            
            
            1,714,626
            
            
            
            5,648,327GROSS
      PROFIT
            
            
            498,043
            
            
            
            544,415
            
            
            
            1,215,927
            
            
            
            1,318,820OPERATING
      EXPENSESGeneral
      and administrative expenses
            
            
            491,646
            
            
            
            363,313
            
            
            
            1,154,523
            
            
            
            1,006,367Sales
      and marketing expenses
            
            
            17,060
            
            
            
            11,294
            
            
            
            60,727
            
            
            
            159,716Depreciation
      and amortization
            
            
            3,600
            
            
            
            -
            
            
            
            10,800
            
            
            
            -Total
      operating expenses
            
            
            512,306
            
            
            
            374,607
            
            
            
            1,226,050
            
            
            
            1,166,083OPERATING
      LOSS
            
            
            (14,263
            )
            
            
            169,808
            
            
            
            (10,123
            )
            
            
            152,737OTHER
      (INCOME) AND EXPENSESInterest
      expense
            
            
            -
            
            
            
            8,141
            
            
            
            1,183
            
            
            
            15,534Interest
      income
            
            
            (818
            )
            
            
            (15,907
            )
            
            
            (4,266
            )
            
            
            (50,636
            )Impairment
      of assets
            
            
            -
            
            
            
            
            
            
            
            3,712,846
            
            
            
            -Legal
      settlement
            
            
            
            
            
            
            -
            
            
            
            33,000
            
            
            
            -Other
      income
            
            
            (6,165
            )
            
            
            -
            
            
            
            (155,614
            )
            
            
            -Total
      other (income) expense
            
            
            (6,983
            )
            
            
            (7,766
            )
            
            
            3,587,149
            
            
            
            (35,102
            )NET
      INCOME BEFORE INCOME TAXES
            
            
            (21,246
            )
            
            
            177,574
            
            
            
            3,577,026
            
            
            
            187,839Provision
      for income taxes
            
            
            
            
            
            
            (51,810
            )
            
            
            
            
            
            
            (75,186
            )NET
      LOSS
            
            
            (7,280
            )
            
            $
            125,764
            
            
            $
            (3,597,273
            )
            
            $
            112,653WEIGHTED
      AVERAGE COMMON SHARES OUTSTANDING:Basic
      and diluted:
            
            
            15,920,785
            
            
            
            15,273,785
            
            
            
            15,920,785
            
            
            
            15,273,785NET
      LOSS PER SHARE:Basic
      and diluted:
            
            
            (0
            )
            
            $
            0.01
            
            
            $
            (0.23
            )
            
            $
            0.01





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





4
 Table of Contents




AMERICAN NORTEL COMMUNICATIONS, INC.CONDENSED
      STATEMENTS OF CASH FLOWSFOR
      THE NINE MONTHS ENDED MARCH 31, 2002 AND 20012002
            
            
            2001(unaudited)
            
            
            (unaudited)CASH
      FLOWS FROM OPERATING ACTIVITIES:Net
      loss
            
            $
            (3,597,273
            )
            
            $
            112,653Adjustments
      to reconcile net loss to net cash used in operating
      activities:Depreciation
      and amortization
            
            
            10,800
            
            
            
            10,800Issuance
      of stock as consideration for services
            
            
            154,200
            
            
            
            -Impairment
      of assets
            
            
            3,712,846
            
            
            
            -Changes
      in operating assets and liabilities:Trade
      accounts receivables
            
            
            987,038
            
            
            
            2,898,331Prepaid
      and other current assets
            
            
            -
            
            
            
            (19,690
            )Deferred
      tax asset
            
            
            295,229
            
            
            
            (2,869
            )Accounts
      payable
            
            
            261,596
            
            
            
            (1,387,169
            )Accrued
      expenses and other liabilities
            
            
            (549,830
            )
            
            
            (26,297
            )Income
      tax payable
            
            
            (396,431
            )
            
            
            78,053Accrued
      interest
            
            
            (48,438
            )
            
            
            14,359Net
      cash provided in operating activities
            
            
            829,737
            
            
            
            1,678,171CASH
      FLOWS FROM INVESTING ACTIVITIES:Purchase
      of marketable securities
            
            
            -
            
            
            
            (1,524,222
            )Notes
      receivables
            
            
            -
            
            
            
            (35,000
            )Purchase
      of equipment
            
            
            -
            
            
            
            (1,499
            )Investment
      in subsidiary
            
            
            (403,318
            )
            
            
            (235,000
            )Net
      cash used in investing activities
            
            
            (403,318
            )
            
            
            (1,795,721
            )CASH
      FLOWS FROM FINANCING ACTIVITIES:Payments
      toward note receivable
            
            
            3,790Repayments
      of notes payable
            
            
            (287,806
            )
            
            
            (728,230
            )Net
      cash used in financing activities
            
            
            (284,016
            )
            
            
            (728,230
            )INCREASE
      (DECREASE) IN CASH
            
            
            142,403
            
            
            
            (845,780
            )CASH,
      BEGINNING OF YEAR
            
            
            219,816
            
            
            
            1,405,002CASH,
      END OF YEAR
            
            $
            362,219
            
            
            $
            559,222SUPPLEMENTAL
      CASH FLOW INFORMATION:Interest
      paid
            
            $
            8,141
            
            
            $
            15,534Taxes
      paid
            
            $
            140,450
            
            
            $
            -





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





5
 Table of Contents




PART I– FINANCIAL INFORMATION





ITEM
1 – FINANCIAL STATEMENTS








AMERICAN
NORTEL COMMUNICATIONS, INC.


NOTES
TO CONDENSED FINANCIAL STATEMENTS THREE AND NINE MONTHS ENDED MARCH 31, 2002 and
2001





1.
            BASIS
      OF PRESENTATION





The
Company has existed in various forms since 1979 and has evolved from a mining
exploration and development business to a telecommunications
business.  The Company has been known as American Nortel
Communications, Inc. (“ANC”) since 1992 and is a Nevada
corporation.  ANC currently operates only in the telecommunications
business, providing long distance telephone service as a reseller in combination
with additional related services in the United States and a number of foreign
countries.





Prior to
September 14, 1994, ANC conducted almost all of its telecommunications business
through NorTel Communications, Inc. (“NorTel-US”), a wholly-owned subsidiary in
Salt Lake City, Utah.  All subsidiaries, including NorTel-US, were not
active and were sold for nominal consideration or were dissolved.





On
September 14, 1994, ANC and NorTel-US filed petitions under Chapter 11 of the
U.S. Bankruptcy Code, under case numbers 948-24604 and 948-24605 respectively in
the U.S. Bankruptcy Court, District of Utah, and Central
Division.  ANC’s bankruptcy proceeding was subsequently converted to a
Chapter 7 proceeding and was thereafter dismissed on February 7,
1996.  NorTel-US was sold June 27, 1996 for nominal consideration to
an affiliate of former directors, leaving ANC as the sole surviving
entity.





The
Company was dormant when ANC’s current President, Chief Executive Office, and
Board Chairman, William P. Williams, Jr. achieved control of the Company on June
27, 1995.  On that day, the former officers and directors resigned and
assigned their rights under certain agreements to Mr. Williams.





2.
            GOING
      CONCERN





The
accompanying condensed financial statements have been prepared in conformity
with accounting principles generally accepted in the United States of America
which contemplate continuation of the Company as a going
concern.  However, the Company has year end losses from operations and
had minimal revenues from operations the nine months ended March 31, 2002.
During nine months ended March 31, 2002 the Company incurred a net loss of
$3,597,273 and has an accumulated deficit of $20,329,157.  Further,
the Company has inadequate working capital to maintain or develop its
operations, and is dependent upon funds from private investors and the support
of certain stockholders.





These
factors raise substantial doubt about the ability of the Company to continue as
a going concern.  The condensed financial statements do not include
any adjustments that might result from the outcome of these
uncertainties.  In this regard, Management is proposing to raise any
necessary additional funds through loans and additional sales of its common
stock. There is no assurance that the Company will be successful in raising
additional capital.





6
 Table of Contents





3.
            INTERIM
      FINANCIAL STATEMENTS




The
accompanying interim unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and Article
8 of Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In our opinion, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. Operating results for the nine-months period ended March 31, 2002 are
not necessarily indicative of the results that may be expected for the year
ending June 30, 2002. For further information, refer to the financial statements
and footnotes thereto included in our Form 10-KSB Report for the fiscal year
ended June 30, 2001.





4.
            SUMMARY
      OF SIGNIFICANT ACCOUNTING POLICIES





We
prepare our consolidated financial statements in accordance with accounting
principles generally accepted in the United States of America. The preparation
of these financial statements requires the use of estimates and assumptions that
affect the reported amounts of assets and liabilities and the disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amount of revenues and expenses during the reporting period. Our
management periodically evaluates the estimates and judgments made. Management
bases its estimates and judgments on historical experience and on various
factors that are believed to be reasonable under the circumstances. Actual
results may differ from these estimates as a result of different assumptions or
conditions.





Critical
Accounting Policies





Stock Based
Compensation





In
December 2004, the FASB issued a revision of SFAS No. 123 ("SFAS No. 123(R)")
that requires compensation costs related to share-based payment transactions to
be recognized in the statement of operations. With limited exceptions, the
amount of compensation cost will be measured based on the grant-date fair value
of the equity or liability instruments issued. In addition, liability awards
will be re-measured each reporting period. Compensation cost will be recognized
over the period that an employee provides service in exchange for the award.
SFAS No. 123(R) replaces SFAS No. 123 and is effective as of the beginning of
January 1, 2006. Based on the number of shares and awards outstanding as of
December 31, 2005 (and without giving effect to any awards which may be granted
in 2006), we do not expect our adoption of SFAS No. 123(R) in January 2006 to
have a material impact on the financial statements.





FSP FAS
123(R)-5 was issued on October 10, 2006. The FSP provides that instruments that
were originally issued as employee compensation and then modified, and that
modification is made to the terms of the instrument solely to reflect an equity
restructuring that occurs when the holders are no longer employees, then no
change in the recognition or the measurement (due to a change in classification)
of those instruments will result if both of the following conditions are met:
(a). There is no increase in fair value of the award (or the ratio of intrinsic
value to the exercise price of the award is preserved, that is, the holder is
made whole), or the antidilution provision is not added to the terms of the
award in contemplation of an equity restructuring; and (b). All holders of the
same class of equity instruments (for example, stock options) are treated in the
same manner. The provisions in this FSP shall be applied in the first reporting
period beginning after the date the FSP is posted to the FASB website. The
Company has adopted SP FAS 123(R)-5 but it did not have a material impact on its
consolidated results of operations and financial condition.




7
 Table of Contents




Accounting Policies and
Estimates





The
preparation of our financial statements in conformity with accounting principles
generally accepted in the United States of America requires our management to
make certain estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period.  Our management periodically
evaluates the estimates and judgments made. Management bases its estimates and
judgments on historical experience and on various factors that are believed to
be reasonable under the circumstances. Actual results may differ from these
estimates as a result of different assumptions or conditions. As such,
in accordance with the use of accounting principles generally accepted in the
United States of America, our actual realized results may differ from
management’s initial estimates as reported.  A summary of significant
accounting policies are detailed in notes to the financial statements which are
an integral component of this filing.





Revenue
Recognition





The
Company has adopted the Securities and Exchange Commission’s Staff Accounting
Bulletin (SAB) No. 104, which provides guidance on the recognition, presentation
and disclosure of revenue in financial statements.





5.
            EQUITY





During
nine months ended March 31, 2002:





The
Company has issued shares of its common stock as consideration to consultants
for the fair value of the services rendered.  The value of those
shares is determined based on the trading value of the stock at the dates on
which the agreements were entered into for the services and the value of
services rendered.   During the nine months ended March 31, 2002,
the Company granted to consultants, 647,000 shares of common stock valued
between $.75 - $.25.  The values of these common shares issued were
expensed during the year in the amount of $154,200.





6.
            RELATED
      PARTY TRANSACTIONS





The
Company’s president and chairman is a 70% shareholder and its sole officer and
director of the Company.  The chairman controls MedCom USA,
Incorporated (“MedCom”) which the company owns is a 31% shareholder in
MedCom.  The chairman also controls Card Activation Technologies, Inc.
(“Card”) in which MedCom owns 30% of Card.  During the year ended June
30, 1995, the Company moved its administrative offices into space occupied by
this related entity.  The Company shares office space and management
and administrative personnel with this related entity.  Certain of the
Company’s personnel perform functions for the related entity but there was no
allocation of personnel related expenses to the related entity in the nine
months ended March 31, 2002 and 2001.





The
Company frequently receives advances, and advances funds to an entity controlled
by the Company’s president and which is a significant shareholder of the Company
to cover short-term cash flow deficiencies.





7.
            SUBSEQUENT
      EVENTS





The
Company issued 4,856,648 shares of common stock for repayment of debt on
November 17, 2005.  This common stock was issued for services
performed for the benefit of MedCom, specifically to pay expenses for
MedCom.  The Company also issued 4,856,648 of common stock in
accordance with the compensation package of Mr. Williams on August 24,
2007.   MedCom owes ANC approximately $250,000 as of December 31,
2007.





8
 Table of Contents





8.
            RECENT
      PRONOUNCEMENTS





Disclosure
about Derivative Instruments and Hedging Activities




In March
2008, the FASB issued SFAS No. 161, “Disclosure about Derivative
Instruments and Hedging Activities,” an amendment of FASB
Statement No. 133, (SFAS 161). This statement requires that objectives for using
derivative instruments be disclosed in terms of underlying risk and accounting
designation. The Company is required to adopt SFAS 161 on January 1, 2009. The
Company is currently evaluating the potential impact of SFAS No. 161 on the
Company’s consolidated financial statements.





Determination
of the Useful Life of Intangible Assets




In April
2008, the FASB issued FSP FAS 142-3, “Determination of the Useful Life of
Intangible Assets,”, which amends the factors that should be considered in
developing renewal or extension assumptions used to determine the useful life of
intangible assets  under FASB 142 “Goodwill and Other Intangible
Assets”.  The intent of this FSP is to improve the consistency between the
useful life of a recognized intangible asset under SFAS 142 and the period of
the expected cash flows used to measure the fair value of the asset under FASB
141 (revised 2007) “Business Combinations” and other U.S. generally accepted
accounting principles.    The Company is currently evaluating the
potential impact of FSP FAS 142-3 on its consolidated financial
statements.





The
Fair Value Option for Financial Assets and Financial Liabilities




In
February 2007, the Financial Accounting Standards Board (“FASB”) issued
Statement of Financial Accounting Standard (“SFAS”) No. 159, “The Fair
Value Option for Financial Assets and Financial Liabilities, including an
amendment of FASB Statement No. 115”. SFAS 159 permits entities to choose
to measure many financial instruments and certain other items at fair value at
specified election dates. This Statement applies to all entities, including
not-for-profit organizations. SFAS 159 is effective as of the beginning of an
entity’s first fiscal year that begins after November 15, 2007. As such,
the Company is required to adopt these provisions at the beginning of the fiscal
year ended December 31, 2008. The Company is currently evaluating the
impact of SFAS 159 on its consolidated financial statements.






ITEM 2 - MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS





Management’s
Discussion and Analysis contains various “forward looking statements” within the
meaning of Section 21E of the Securities Exchange Act of 1934, as amended,
regarding future events or the future financial performance of the Company that
involve risks and uncertainties. Certain statements included in this quarterly
report on Form 10-Q, including, without limitation, statements related to
anticipated cash flow sources and uses, and words including but not limited to
“anticipates”, “believes”, “plans”, “expects”, “future” and similar statements
or expressions, identify forward looking statements. Any forward-looking
statements herein are subject to certain risks and uncertainties in the
Company’s business, including but not limited to, reliance on key customers and
competition in its markets, market demand, product performance, technological
developments, maintenance of relationships with key suppliers, difficulties of
hiring or retaining key personnel and any changes in current accounting rules,
all of which may be beyond the control of the Company. The Company adopted at
management’s discretion, the most conservative recognition of revenue based on
the most astringent guidelines of the SEC in terms of recognition of software
licenses and recurring revenue. Management will elect additional changes to
revenue recognition to comply with the most conservative SEC recognition on a
forward going accrual basis as the model is replicated with other similar
markets (i.e. SBDC). The Company’s actual results could differ materially from
those anticipated in these forward-looking statements as a result of certain
factors, including those set forth therein.




9
 Table of Contents




Forward-looking
statements involve risks, uncertainties and other factors, which may cause our
actual results, performance or achievements to be materially different from
those expressed or implied by such forward-looking statements. Factors and risks
that could affect our results and achievements and cause them to materially
differ from those contained in the forward-looking statements include those
identified in the section titled “Risk Factors” in the Company’s Annual Report
on Form 10-KSB for the year ended June 30, 2007, as well as other factors that
we are currently unable to identify or quantify, but that may exist in the
future.




In
addition, the foregoing factors may affect generally our business, results of
operations and financial position. Forward-looking statements speak only as of
the date the statement was made. We do not undertake and specifically decline
any obligation to update any forward-looking statements.





Overview





American
Nortel, Inc.  ("ANC" or the "Company"), was formed as a Wyoming
corporation in 1979.  In 2008, we redomiciled to the State of Nevada.
We are a reseller of 1-Plus and 1-800 long-distance telecommunications
services.  ANC resells to customers’ long distance telephone time that
it purchases or leases from other long distance carriers.





ANC
resells long distance telephone services to both small business and residential
customers.  As a reseller it purchases or leases long distance time
from other carriers and resells that time to others.  ANC is charged
for the time it beyond certain minimum requirements and in turn charges its
customers a certain amount per minute.  To a large extent, ANC’s
profits are dependent upon the spread between its cost per minute and the amount
it charges its customers.  Telemarketing is a recurring expense and is
its sales and marketing expense.  ANC out-sources its marketing
efforts to telemarketers and it pays those telemarketers a certain amount for
each new customer obtained.  The Company does not direct-bill its
customers, but rather utilizes the Local Exchange Carriers (LEC) which provides
local area telephone service to the Company long-distance customers, for billing
and collections.  LECs receive a fee based upon a certain percentage
of amounts collected.  Management believes that the practice of
billing through LECs has substantial advantages since it increases the
likelihood and promptness of collections.





ANC’s
method of operations has certain advantages and disadvantages.  It
substantially reduces its out-of-pocket expenses of such things as capital,
equipment costs, rent and salaries.  But it also makes ANC more
dependent upon the performance of others whom it does not control, and upon its
ability to contract for such services at a reasonable price.  With
regard to its cost of obtaining long distance time, there is presently a surplus
of lines and capacity held by carriers who sell long distance usage time to ANC
on a bulk basis, and ANC believes that such surplus will continue in the
foreseeable future.





Competition





The long
distance telephone industry is intensely competitive.  There are many
large and small competitors in the industry, many of which share the same target
market as ANC.  Many of the Company’s competitors have much larger
resources, and are more established and have a larger customer base than
ANC.  There are also a large number of resellers, many of who operate
in a manner similar to ANC. Competition among resellers and other providers of
long-distance services generally is conducted on the basis of
price.  Prices have been decreasing over the last several years,
sometimes dramatically, for a variety of communication
services.  Customers have become more sophisticated and price
conscious.  They are likely to switch services when new competitor
communication packages become available, and switching from one service provider
to another typically has few, if any, cost implications for a customer. ANC
constantly obtains new customers to replace its customer account
attrition.  Other sources of competition may be developing because of
new offerings by telecommunication providers, such as cable television industry,
Internet telephony, and voice and data communication.





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Regulatory
Background





The Company is subject to
regulation by theU.S.Federal Communications
Commission (the "FCC").





The
existing domestic long distance telecommunications industry was principally
shaped by a 1984 court decree (the “Decree”) that required the divestiture by
AT& T of its 22 bell operating companies (“BOCs”), organized the BOCs under
seven regional Bell operating companies (“RBOCs”) and divided the country into
some 200 Local Access Transport Areas or “LATAs.”  The incumbent local
exchange carriers (“ILECS”), which include the seven RBOCS as well as
Independent local exchange carriers, were given the right to provide local
telephone service, local access service to long distance carriers and intra-LATA
long distance service (long distance service within LATAS), but the RBOCs were
prohibited from providing inter-LATA service (service between
LATAs).  The right to provide inter-LATA service was given to AT&T
and the other interexchange carriers (“IXC”).  Conversely, IXCs were
prohibited from providing local telephone service.





A typical
inter-LATA long distance telephone call begins with the local exchange carrier
(“LEC”) transmitting the call by means of its local network to a point of
connection with an IXC. The IXC, through its switching and transmission network,
transmits the call to the LEC serving the area where the recipient of the call
is located, and the receiving LEC then completes the call over its local
facilities. For each long distance call, the originating LEC charges an access
fee. The IXC also charges a fee for its transmission of the call, a portion of
which consists of a terminating fee which is passed on to the LEC which delivers
the calls.  To encourage the development of competition in the long
distance market, the Decree required LECs to provide all IXCs with access to
local exchange services “equal in type, quality and price” to that provided to
AT&T.  These so-called “equal access” and related provisions were
intended to prevent preferential treatment of AT&T and to level the access
charges that the LECs could charge IXCs, regardless of their volume of
traffic.  As a result of the Decree, customers of all long distance
companies were eventually allowed to initiate their calls by utilizing simple
1 plus dialing, rather
than having to dial longer access or identification numbers and
codes.





The Telecommunications Act
(enacted on February 8, 1996) has significantly altered the telecommunications
industry.  The Decree has been lifted and all restrictions and
obligations associated with the Decree have been eliminated by the new
legislation.  The seven RBOCs are now permitted to provide long
distance service originating (or in the case of “800” service, terminating)
outside the local services areas or offered in conjunction with other ancillary
services, including wireless services.  Following application to the
FCC, and upon a finding by the FCC that the RBOC faces facilities-based
competition and has satisfied a congressionally-mandated “competitive checklist”
of interconnection and access obligations, an RBOC will be permitted to provide
long distance service within its local service area, although in so doing it
will be subject to a variety of structural and nonstructural safeguards intended
to minimize abuse of its market power in these local service
areas.  Having opened the interexchange market to RBOC entry, the
Telecommunications Act also removes all legal barriers to competitive entry by
interexchange and other carriers into the local telecommunications market and
directs RBOCs to allow competing telecommunications service providers, such as
the Company, to interconnect their facilities with the local exchange network,
to acquire network components on an unbundled basis and to resell local
telecommunications services.  Moreover, the Telecommunications Act
prevents IXCs that serve greater than five percent of pre-subscribed access
lines in the U.S., (which includes the nation’s three largest long distance
providers) from jointly marketing their local and long distance services until
the RBOCs have been permitted to enter the long distance market or for three
years, whichever is sooner.  This provision of the Act is intended to
give all other long distance providers a competitive advantage over the larger
long distance providers in the newly opened local telecommunications
market.  As a result of the Telecommunications Act, long distance
carriers will allow significant new competition in the long distance
telecommunications market, but will also be afforded significant new business
opportunities in the local telecommunications market.





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Legislative,
judicial and, technology factors have helped to create the foundation for
smaller long distance providers, such as the Company, to emerge as alternative
long distance service.  The FCC has required all IXCs to allow the
resale of their services, and the Decree substantially eliminated different
access arrangements as distinguishing features among long distance
carriers.  In recent years, national and regional network providers
have substantially upgraded the quality and capacity of their domestic long
distance networks, resulting in significant excess transmission capacity for
voice and data communications.  The Company believes that, as a result
of digital fiber optic technology and installation of fiber optic transmission
networks, excess capacity has been, and will continue to be, an important factor
in long distance telecommunications.  The Company believes that
resellers and the smaller long distance service providers represent a source of
traffic such to carriers with excess capacity.  Thus, resellers have
become an integral part of the long distance telecommunications
industry.





Industry
Evolution





Resellers
represent a paradox in the telecommunications marketplace.  They are
simultaneously an important source of revenues to the major long distance
providers and yet resellers represent a risk to the product quality, reputation
and pricing.  Not only do long distance service resellers receive
legal protection to compete with the network based major carriers, but also the
resellers’ sale of network based carriers, excess capacity represents a source
of additional traffic for such carriers.  The Company believes that
the three major carriers and most regional carriers have a substantial excess
telecommunication transmission capacity and that the constant technological and
facility upgrading will continue, with resultant excess capacity in there
carriers’ network for the foreseeable future.





Resellers
primarily exist due to their ability to offer substantially discounted long
distance toll rates, and increasingly, discounted calling card rates and other
discounted services, to their prime target markets, which are small and medium
sized businesses.  The main target market for most resellers is not as
profitable as other markets for wholesale or major carriers to serve and the
major carriers have focused on the larger businesses, generally those who are
currently paying less than $25,000 a month in long distance
charges.





Traditionally,
many resellers originated as customer base groups or aggregators of customers,
and their operations generally are marked by relatively low overhead and low
capital investment in property, plant & equipment.  Resellers
often offer services that larger carriers are not prepared to offer, such as
customized location billing, non-telecom billing services, international
call-back, customized calling cards, multiple carrier service at single
locations with single invoices, and split dedicated service.  Although
there is an existence of some regulatory barriers, the costs of overcoming these
are low.  With low entry barriers, a significant portion of the
telecommunications market is still open to significant competition on a price
and service basis.  To date, resellers have been able to quickly build
sizable customer bases on marketing and telemarketing strengths.  In
many cases rapid growth has strained some reseller’s ability to manage their
growing revenues and their general business enterprise.  Therefore,
their ability to attract capital to finance receivables, improve facilities and
equipment, and develop management and systems infrastructure, will be the
difference between resellers that survive as independent companies and those
that will merge or be acquired.





The
Company believes that the major carriers and some of the regional carriers will
continue to derive a portion of their revenues from their wholesalers and resale
market sales, since resellers can currently serve their target market at a price
that the major or regional carrier cannot or will not provide. The Company
believes that opportunities for future growth of its business exists in high
gross profit product/service area segments, including prepaid calling cards,
international services, cellular and wireless services, video and data
transmission, web-sight and internet-access, 800 number service, voice mail and
electronic mail. As a result, the Company expects that the number of call
minutes billed by resellers will continue to rise at an annual rate that,
measured on a percentage basis, is substantially greater than the number of call
minutes billed by the major carriers.  Within the resale market as a
whole, switchless
resellers, such as the Company, appear to have experienced in recent periods a
higher percentage growth than have facilities-based carriers in all the segments
previously mentioned.  However, more switchless resellers will become
facilities-based as they acquire small companies and as their traffic increase
in geographic zones, which will increase their ability to purchase or lease a
switch.  More traffic flowing in a given area would enhance a
reseller’s ability to make a switch economically viable and more profitable for
that geographic zone.





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Service and
Products





The
Company offers a basic 1 plus
and 800 long distance services.  ANC is successful as a
provider of these basic services because of the volume discounts it has been
able to negotiate with its underlying carriers.





The
Company charges its customers on the basis of minutes or partial minutes of
usage at rates which vary with the distance, duration, time of day of the call,
and type of call.  Rate charges for a call are not affected by the
particular transmission facilities selected for the call transmission, but are
affected by the type of call a user may select.  All billing is done
through the local exchange carrier (“LEC”).  The Company offers a
flat-rate long distance calling service throughout the United States; these
providers’ rates usually are the same per minute rate regardless of the call’s
origin or destination.  Billing occurs in six-second
increments.





On
December 9, 1996 ANC entered into a Billing Services Agreement (One Plus (1+))
with Integretel Incorporated (“IGT”) whereby IGT would provide ANC telephone
company billing and collection and associated services to the telecommunications
industry.  The agreement term is for two years, automatically
renewable in two-year increments unless appropriate notice to terminate is given
by either party.  The agreement automatically renewed on December 9,
1998, as neither party had given notice of terminations prior to that renewal
date. Under the agreement, IGT bills, collects and remits the proceeds to ANC
net of reserves for bad debts, billing adjustments, telephone company fees and
IGT fees.  If either the Company’s transaction volume decreases by 25%
from the preceding month, less than 75% of the traffic is billable to major
telephone companies, IGT may at its own discretion increase the reserves and
holdbacks under this agreement.  IGT is the only provider of this
service to the Company.





On
December 19, 1996 ANC entered into a Master Agreement for Purchase and Sale of
Accounts with IGT whereby IGT purchases accounts from ANC for a purchase price
consisting of an advance component and a deferred component.  The
advance component, which is calculated by multiplying the estimated purchase
price by the advance component percentage, is payable within ten days of receipt
of the transaction batch pertaining to the purchased accounts.  The
deferred component is the differential of the amount actually collected by IGT
and the advance component and is payable when the amount is
determined.  Except for the right of IGT to refuse to accept or reject
acceptance of accounts and except for the right of IGT to charge back amounts to
ANC under certain circumstances, the sale of accounts is without recourse and
IGT assumes the full credit risk.  Certain charge backs and fees are
recourse obligations of ANC.  IGT maintains both Non-recourse and
Recourse accounts comprising the combined account for ANC.  The
maximum purchase obligation of IGT to ANC was set at $700,000 when the agreement
was entered into in December 1996.  This amount was subsequently
increased to $3,000,000 as of March 31, 1998.





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Marketing
Strategy





The
Company is no longer in the long distance business and is seeking new
acquisitions.  The revenues collected are residuals from the long
distance business.





Delinquent Filing of SEC
Reports and Inadequacies of Disclosures





ANC
failed to timely file with Securities and Exchange Commission (“SEC”) its
periodic reports, including its annual reports on Form 10K for fiscal 2002,
2003, 2004, 2005, 2006, 2007, and its Form 10-Q reports for those years. The
Company intends to shortly complete the filing of all the required periodic
reports.





Revenues





The
Company has adopted the Securities and Exchange Commission’s Staff Accounting
Bulletin (SAB) No. 104, which provides guidance on the recognition, presentation
and disclosure of revenue in financial statements.





Additional
Information





ANC files
reports and other materials with the Securities and Exchange
Commission.  These documents may be inspected and copied at the
Commission’s Public Reference Room at 100 F Street, NE, Washington, DC
20549.  You can obtain information on the operation of the Public
Reference Room by calling the Commission at 1-800-SEC-0330.  You can
also get copies of documents that the Company files with the Commission through
the Commission’s Internet site at www.sec.gov.





Results of
Operations





Revenues
for the three months ended March 31, 2002 decreased to $891,704 from $1,859,173
for the three months ended March 31, 2001. Revenues for the nine months ended
March 31, 2002 decreased to $2,930,553 from $6,967,147 for the nine months ended
March 31, 2001.  This decrease in revenue is directly the result of
changes in the Company's strategic direction in core operations.  The
Company purchased new accounts in the past but has reduced the purchase of new
accounts and reduced it customer base.





Cost of
services for three months ended March 31, 2002 decreased to $393,661 from
$1,314,758 for three months ended March 31, 2001.  Cost of services
for nine months ended March 31, 2002 decreased to $1,714,626 from $5,648,327 for
the nine months ended March 31, 2001.   The reduction in the cost
of services is directly related to the reduction in airtime
services.  The company has reduced it telecommunication business to
refocus the direction of the company.





Selling
expenses for three months ended March 31, 2002 increased to $17,060 from $11,294
for three months ended March 31, 2001.  Selling expenses for nine
months ended March 31, 2002 decreased to $60,727 from $159,716 for the nine
months ended March 31, 2001.  The decrease in selling expenses was a
result of the decrease in marketing costs expended by the
company.  The Company was able to negotiate a lower cost per customer
throughout their telemarketing out-source.





General
and administrative expenses for the three months ended March 31, 2002 increased
to $491,646 from $363,313 for three months ended March 31,
2001.  General and administrative expenses for nine months ended March
31, 2002 increased to $1,154,523 from $1,006,367 the nine months ended March 31,
2001.  This increase is attributed to the Company's increase in cost
of long distance traffic.  The Company reduced its workforce
operations as the Company has streamlined overall employee use.  That
is the Company has implemented and advanced its in-house software to perform
many of the services the prior employees were performing manually.





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The
(loss) income for three months ended March 31, 2002 increased to ($7,280) from
$125,764 for the three months ended March 31, 2001.  The (loss) income
for the nine months ended March 31, 2002 increased to ($3,597,273) from $112,653
for the nine months ended March 31, 2001.  The decrease is due to the
reduction in revenue, sales force, and reduction in operations.





No tax
benefit was recorded on the expected operating loss for March 31, 2002 and 2001
as required by Statement of Financial Accounting Standards No. 109, Accounting
for Income Taxes.  For the quarter ended we do not expect to realize a
deferred tax asset and it is uncertain, therefore we have provided a 100%
valuation of the tax benefit and assets until we are certain to experience net
profits in the future to fully realize the tax benefit and tax
assets.





LIQUIDITY
AND CAPITAL RESOURCES





The
Company’s operating requirements have been funded primarily on its sale of long
distance services.  During the nine months ended March 31, 2002, the
Company’s net proceeds from long distance of were $2,930,553 as compared to
March 31, 2001 of $6,967,147.  The Company believes that the cash
flows from its monthly service and transaction fees are inadequate to repay the
capital obligations.





Cash
provided from operating activities for the nine months ended March 31, 2002 was
$829,737 compared to $1,678,171 for March 31, 2001.  The Company’s
focus on core operations results in a decrease in the sale of long distance
services.  The Company receives payments from customers automatically
through electronic fund transfers.  Collection cycles of the long
distance services agreements are generally paid monthly.  The Company
has grown its operations in the past but has decided to refocus the operations
on a new direction.  The Company impaired its assets in marketable
securities as they were worthless in value of $3,712.846.  The Company
issued its common stock for services of $154,200.





Cash used
in investing activities was ($403,318) for nine months ended March 31, 2002,
compared to ($1,795,721) for March 31, 2001.  Streamlining operations
and capital budget curtailment practices promoted a reduction in purchase of
marketable securities for the Company.  The Company no longer invests
small cap marketable securities.  The Company invested in its
unconsolidated subsidiary of ($403,318) for nine months ended March 31, 2002 as
compared to ($235,000) for March 31, 2001.





Cash used
in financing activities was ($284,016) for the nine months ended March 31, 2002
as compared to ($728,230) for March 31, 2001.  Financing activities
primarily consisted of proceeds from the increase in the long distance services
through Integretel, Inc.  The Company does not have adequate cash
flows to satisfy its obligations although have improved cash flow and
anticipates have adequate cash flows in the upcoming fiscal
periods.  The Company repaid its loans for nine months ended March 31,
2002 of ($287,806) as compared to March 31, 2001 of ($728,230).





Other
Considerations





There are
numerous factors that affect our business and the results of its operations.
Sources of these factors include general economic and business conditions,
federal and state regulation of business activities, the level of demand for the
Company’s product or services, the level and intensity of competition in the
medical transaction processing industry and the pricing pressures that may
result, the Company’s ability to develop new services based on new or evolving
technology and the market’s acceptance of those new services, the Company’s
ability to timely and effectively manage periodic product transitions, the
services, customer and geographic sales mix of any particular period, and the
ability to continue to improve infrastructure including personnel and systems,
to keep pace with the growth in its overall business activities.





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ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
MARKET RISK





We do not
hold any derivative instruments or other market risk sensitive instruments and
do not engage in any hedging activities. As a result, we have no exposure to
potential loss in future earnings, fair values or cash flows as a result of
holding any market risk sensitive instruments.  The Company is in the
business of long distance services.






ITEM 4.   CONTROLS AND PROCEDURES




(a)
Evaluation of Disclosure Controls and Procedures.Based upon an
evaluation of the effectiveness of the Company’s disclosure controls and
procedures performed by the Company’s management, with participation of the
Company’s Chief Executive Officer, Chief Operating Officer, and its Chief
Accounting Officer as of the end of the period covered by this report, the
Company’s Chief Executive Officer, Chief Operating Officer, and its Chief
Accounting Officer concluded that the Company’s disclosure controls and
procedures have been effective in ensuring that material information relating to
the Company, including its consolidated subsidiary, is made known to the
certifying officers by others within the Company and the Bank during the period
covered by this report.




As used
herein, “disclosure controls and procedures” mean controls and other procedures
of the Company that are designed to ensure that information required to be
disclosed by the Company in the reports that it files or submits under the
Securities Exchange Act is recorded, processed, summarized and reported, within
the time periods specified in the Commission’s rules and
forms.  Disclosure controls and procedures include, without
limitation, controls and procedures designed to ensure that information required
to be disclosed by the Company in the reports that it files or submits under the
Securities Exchange Act is accumulated and communicated to the Company’s
management, including its principal executive and principal financial officers,
or persons performing similar functions, as appropriate to allow timely
decisions regarding required disclosure.




Management’s
Report on Internal Control over Financial Reporting.Our management is responsible
for establishing and maintaining adequate internal control over financial
reporting as such term is defined in Rule13a-15(f) under the Exchange
Act.  Our internal control over financial reporting is a process
designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes in
accordance with accounting principles generally accepted in theUnited States.Under the
supervision and with the participation of the Chief Executive Officer, the Chief
Operating Officer and the Chief Accounting Officer, we conducted an evaluation
of the effectiveness of our control over financial reporting based on the
framework in Internal
Control-Integrated Frameworkissued by the Committee of Sponsoring
Organizations of the Treadway Commission (“COSO”).  Based on our
evaluation under the framework, management has concluded that our internal
control over financial reporting was effective as of March 31, 2002 and June 30,
2008.




Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements. Therefore, even those systems determined to be
effective can provide only reasonable assurance of achieving their control
objectives. Furthermore, smaller reporting companies face additional
limitations.  Smaller reporting companies employ fewer individuals and find
it difficult to properly segregate duties.  Often, one or two individuals
control every aspect of the Company’s operation and are in a position to
override any system of internal control.  Additionally, smaller reporting
companies tend to utilize general accounting software packages that lack a
rigorous set of software controls.




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Our
management, with the participation of the Chief Executive Officer, the Chief
Operating Officer and the Chief Accounting Officer, evaluated the effectiveness
of the Company’s internal control over financial reporting as of March 31,
2008.  In making this assessment, our management used the criteria set
forth by the Committee of Sponsoring Organizations of the Treadway Commission
(COSO) in Internal Control — Integrated Framework.  Based on this
evaluation under the framework, our management concluded that our internal
control over financial reporting was effective as of March 31, 2002 and June 30,
2008.




(b)
 Changes in Internal
Control over Financial Reporting.  There were no changes in our
internal control over financial reporting, as defined in Rules 13a-15(f) and
15d-15(f) under the Exchange Act, during our most recently completed fiscal
quarter ended March 31, 2008 that have materially affected, or are reasonably
likely to materially affect, our internal control over financial
reporting.





PART
II – OTHER INFORMATION





ITEM 1. LEGAL PROCEEDINGS





We were
involved in various legal proceedings and claims as described in our Form 10-KSB
for the year ended June 30, 2001. No material developments occurred in any of
these proceedings during the quarter ended March 31, 2002. The costs and results
associated with these legal proceedings could be significant and could affect
the results of future operations.






ITEM 1A - Risk Factors





I. Risk Factors That May
Affect Our Results of Operations and Financial Condition





You
should carefully consider the following risk factors before making an investment
decision. If any of the following risks actually occur, our business, financial
condition or results of operations could be materially adversely affected. In
such cases, the trading price of our common stock could decline and you may lose
all or a part of your investment.





Our
Common Stock Is Subject To Penny Stock Regulation





Our
shares are subject to the provisions of Section 15(g) and Rule 15g-9 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), commonly
referred to as the "penny stock" rule. Section 15(g) sets forth certain
requirements for transactions in penny stocks and Rule 15g-9(d)(1) incorporates
the definition of penny stock as that used in Rule 3a51-1 of the Exchange Act.
The Commission generally defines penny stock to be any equity security that has
a market price less than $5.00 per share, subject to certain exceptions. Rule
3a51-1 provides that any equity security is considered to be penny stock unless
that security is: registered and traded on a national securities exchange
meeting specified criteria set by the Commission; authorized for quotation on
the NASDAQ Stock Market; issued by a registered investment company; excluded
from the definition on the basis of price (at least $5.00 per share) or the
registrant's net tangible assets; or exempted from the definition by the
Commission. Since our shares are deemed to be "penny stock", trading in the
shares will be subject to additional sales practice requirements on
broker/dealers who sell penny stock to persons other than established customers
and accredited investors.





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The
Liquidity Of Our Common Stock Is Seriously Limited And There Is A Limited Market
For Our Common Stock





Our stock
is currently being traded on the NASDAQ Over-The-Counter Bulletin Board, and the
liquidity of our common stock is limited. The Bulletin Board is a limited market
and subject to substantial restrictions and limitations in comparison to the
NASDAQ system. Any broker/dealer that makes a market in our stock or other
person that buys or sells our stock could have a significant influence over its
price at any given time.





We
May Not Have Access to Sufficient Capital to Pursue our litigation and therefore
Would Be Unable to Achieve Our Planned Future Growth:




We intend
to pursue a growth strategy that includes development of the Company business
and technology.  Currently we have limited capital which is
insufficient to pursue our plans for development and growth.  Our
ability to implement our growth plans will depend primarily on our ability to
obtain additional private or public equity or debt financing.  We are
currently seeking additional capital.  Such financing may not be
available at all, or we may be unable to locate and secure additional capital on
terms and conditions that are acceptable to us.  Our failure to obtain
additional capital will have a material adverse effect on our
business.





Our
Lack of Diversification In Our Business Subjects Investors to a Greater Risk of
Losses:




All of
our efforts are focused on the development and growth of that business and its
technology in an unproven area.  Although the medical billing is
substantial, we can make no assurances that the marketplace will accept our
products.






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





There
were no changes in securities and small business issuer purchase of equity
securities during the period ended March 31, 2002, except as described
below.




We issued
647,000 shares of common stock for services valued at $154,200.  We
have sold or issued the following securities not registered under the Securities
Act by reason of the exemption afforded under Section 4(2) of the Securities Act
of 1933, within the last quarter. Except as stated below, no underwriting
discounts or commissions were paid with respect to any of the following
transactions. The offer and sale of the following securities was exempt from the
registration requirements of the Securities Act under Rule 506 insofar as
(1) except as stated below, each of the investors was accredited within the
meaning of Rule 501(a); (2) the transfer of the securities were restricted
by the company in accordance with Rule 502(d); (3) there were no more
than 35 non-accredited investors in any transaction within the meaning of
Rule 506(b), after taking into consideration all prior investors under
Section 4(2) of the Securities Act within the twelve months preceding the
transaction; and (4) none of the offers and sales were effected through any
general solicitation or general advertising within the meaning of Rule
502(c).  Also, was a Form D filed and blue sky filings made (if a
private placement)




We issued
4,340,132 shares of common stock on November 17, 2005 for a repayment of debt to
the Company president valued at $1,692,651.  We have sold or issued
the following securities not registered under the Securities Act by reason of
the exemption afforded under Section 4(2) of the Securities Act of 1933, within
the last quarter. Except as stated below, no underwriting discounts or
commissions were paid with respect to any of the following transactions. The
offer and sale of the following securities was exempt from the registration
requirements of the Securities Act under Rule 506 insofar as
(1) except as stated below, each of the investors was accredited within the
meaning of Rule 501(a); (2) the transfer of the securities were restricted
by the company in accordance with Rule 502(d); (3) there were no more
than 35 non-accredited investors in any transaction within the meaning of
Rule 506(b), after taking into consideration all prior investors under
Section 4(2) of the Securities Act within the twelve months preceding the
transaction; and (4) none of the offers and sales were effected through any
general solicitation or general advertising within the meaning of Rule
502(c).  Also, was a Form D filed and blue sky filings made (if a
private placement)





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We issued
4,856,648 shares of common stock on August 24, 2007 for payment of compensation
package previously authorized by the Board of Director which was valued at
$1,942,659.  We have sold or issued the following securities not
registered under the Securities Act by reason of the exemption afforded under
Section 4(2) of the Securities Act of 1933, within the last quarter. Except as
stated below, no underwriting discounts or commissions were paid with respect to
any of the following transactions. The offer and sale of the following
securities was exempt from the registration requirements of the Securities Act
under Rule 506 insofar as (1) except as stated below, each of the
investors was accredited within the meaning of Rule 501(a); (2) the
transfer of the securities were restricted by the company in accordance with
Rule 502(d); (3) there were no more than 35 non-accredited investors
in any transaction within the meaning of Rule 506(b), after taking into
consideration all prior investors under Section 4(2) of the Securities Act
within the twelve months preceding the transaction; and (4) none of the offers
and sales were effected through any general solicitation or general advertising
within the meaning of Rule 502(c).  Also, was a Form D filed and blue
sky filings made (if a private placement)






ITEM 3.  DEFAULTS UPON SENIOR SECURITIES




There
were no defaults upon senior securities during the period ended March 31,
2002.






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





There
were no matters submitted to the vote of securities holders during the period
ended March 31, 2002.






ITEM 5.  OTHER INFORMATION





On May
26, 2000, we dismissed its principal certified public accountant for the past 3
years, LaVoie, Charvoz & May, and P.C.  and retained King, Weber
& Associates, P.C.





King
Weber & Associates PC was acquired by Epstein Weber & Conover
PLP.  Epstein Weber & Conover PLP was acquired by Moss Adams
LLP.  Moss Adams contacted the SEC and informed the SEC that they were
resigning from many auditing engagements including American Nortel
Communications, Inc.





In March,
2008 we engaged Jewett, Schwartz, Wolfe and Associates as our
auditors.





EXHIBITS





31.1
            Certification
      of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley
      Act31.2
            Certification
      of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley
      Act.32.1
            Certification
      of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley
      Act.32.2
            Certification
      of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley
      Act.





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SIGNATURES





Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934 the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.





Registrant
            American
      Nortel Communications, Inc.Date: July
      14, 2008
            By:
      /s/ William P-. WilliamsWilliam
      P. WilliamsChairman,
      President Chief Executive Officer (Principle Executive Officer, Principle
      Financial Officer)






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