UNITED STATES


SECURITIES AND EXCHANGE COMMISSION


Washington, DC 20549








FORM 10-QSB/A





[X] Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934





For the quarterly period ended October 31, 2003





[ ] Transition Report pursuant to 13 or 15(d) of the Securities Exchange Act of 1934





For the transition period from   to





Commission File Number: 000-19457





LEGAL ACCESS TECHNOLOGIES, INC.


(Exact name of Small Business Issuer as specified in its charter)








Nevada       87-0473323


(State or other jurisdiction of (IRS Employer


incorporation) Identification No.)





3199 E. Warm Springs Road, Suite #200


Las Vegas, NV      89120


(Address of principal executive offices)     (Zip Code)





Issuers telephone number, including area code (702) 949-6115





Indicate by a check mark whether the issuer (1) has filed all reports required to be filed 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 issuer was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days [X] Yes [ ] No





State the number of shares outstanding of each of the issuers classes of common equity, as of the latest practicable date: 6,248,732shares of Common Stock as of October 31, 2003.





Transitional Small Business Disclosure Format (check one): Yes [ ] No [X]





This amended report is being filed at this time because of a restatement in the Companys October 31, 2003, financial statements discussed in Note 3 to the financial statements included herein and Item 2, Managements Discussion and Analysis of Financial Condition and Results of Operations.






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PART 1  FINANCIAL INFORMATION
 
 ITEM 1. FINANCIAL STATEMENTS







**LEGAL ACCESS TECHNOLOGIES, INC. AND SUBSIDIARIES**
**BALANCE SHEETS**
**OCTOBER 31, 2003 AND APRIL 30, 2003**


**October 31, 2003****Restated**                   April 30, 2003**(Unaudited)****ASSETS****Current Assets**Cash and cash equivalents
**$**
**39,005**

$
94,236Accounts receivable, trade

**52,071**


27,443Accounts receivable, discontinued business segment, net of allowance $4,776,484 and $4,672,287

**337,053**


530,000Notes receivable

**25,000****453,129**


651,679**Property and equipment, net of accumulated depreciation of $201,584 and $163,065**

**113,305**


155,024**Software license, net of accumulated amortization of $66,849 and $45,148**

**150,203**


171,029**$**
**716,637**

$
977,732**LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)****Current liabilities**Accounts payable
**$**
**36,421**

$
180,005Accrued expenses

**494,549**


146,516Due to President/CEO

**3,750**Convertible notes and accrued interest

**260,032**


269,638**794,752**


596,159**Stockholders' equity (deficiency)**Common stock, $0.001 par value, 100,000,000 shares authorized, 6,248,732 shares issued and outstanding

**6,248**


6,088Additional paid-in capital

**6,256,937**


6,049,097Deficit

**(6,341,300**
**)**

(5,673,612)**(78,115**
**)**

381,573$
**716,637**

$
977,732





**See notes to financial statements.**











2





**LEGAL ACCESS TECHNOLOGIES, INC. AND SUBSIDIARIES**


CONSOLIDATED STATEMENTS OF OPERATIONS


THREE AND SIX MONTHS ENDED OCTOBER 31, 2003 AND 2002 (Unaudited)








|**Three Months ended****Six Months ended**                                                            
|------------------------------------------------------------------------------------------------------
|**October 31, 2003**       Three Months ended     **October 31, 2003**       Six Months ended         
|**Restated**                October 31, 2002               **Restated**               October 31, 2002
|                                                                                                      
|**Revenues**                                                                                          
|                                                                                                      
|                                                                                                      
|**Operating costs and expenses**                                                                      
|Legal support services                                                                                
|Software research and development                                                                     
|Selling, general, and administrative                                                                  
|                                                                                                      
|                                                                                                      
|                                                                                                      
|                                                                                                      
|**Loss from operations**                                                                              
|                                                                                                      
|**Other income (expense)**                                                                            
|Interest                                                                                              
|Rentals                                                                                               
|                                                                                                      
|**Loss from continuing operations**                                                                   
|                                                                                                      
|**Income from discontinued operations**                                                               
|                                                                                                      
|                                                                                                      
|**Net loss**                                                                                          
|                                                                                                      
|                                                                                                      
|                                                                                                      
|**Basic and diluted income (loss) per common share:**                                                 
|Continuing operations                                                                                 
|Discontinued operations                                                                               
|                                                                                                      
|Net loss                                                                                              
|                                                                                                      
|                                                                                                      
|**Weighted average common shares outstanding**                                                        
|                                                                                                      

**See notes to financial statements.**




3




LEGAL ACCESS TECHNOLOGIES, INC. AND SUBSIDIARIES


CONSOLIDATED STATEMENTS OF CASH FLOWS


SIX MONTHS ENDED OCTOBER 31, 2003 AND 2002 (Unaudited)






**Six Months ended****October 31, 2003**     Six Months ended**Restated**               October 31, 2002**Operating activities**Net cash used in operating activities

$
**(435,994**
**)**
$
(915,863)**Investing activities**Notes receivable


**(25,000**
**)**

-Purchase of software license


**(875**
**)**

(1,250)Sale of equipment


**1,941**


(82,730)Net cash used in investing activities


**(23,934**
**)**

(83,980)**Financing activities**Proceeds from borrowings, officers/ shareholders, other related party


**21,000**


-Repayment of borrowings, officers/ shareholders


**(17,250**
**)**

-Collection of accounts receivable of a discontinued business segment


**192,947**


161,806Sale of common stock


**208,000**


-Net cash provided by financing activities


**404,697**


161,806**Net increase (decrease) in cash and cash equivalents**


**(55,231**
**)**

(838,037)**Cash and cash equivalents, beginning of period**


**94,236**


1,145,512**Cash and cash equivalents, end of period**

$
**39,005**

$
307,475**Reconciliation of net loss to net cash used in operating activities**Net loss


**(667,688**
**)**

(1,059,734)Non-cash items (operating activities):Depreciation and amortization


**62,176**


64,140Gain on sale of equipment


**(697**
**)**

-Common stock issued for services


**-**


17,500Increase in operating (assets) liabilitiesAccounts receivable


**(24,628**
)

(23,640)Prepaid expenses and other


**-**


19,054Accounts payable


**(139,531**
**)**

53,815Accrued expenses


**343,980**


2,827Accrued interest


**(9,606**
**)**

10,175Net cash used in operating activities

$
**(435,994**
**)**
$
(915,863)








4




LEGAL ACCESS TECHNOLOGIES, INC. AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS





1. Basis of Presentation





The accompanying unaudited financial statements have been prepared in accordance with the instructions to Form 10-QSB and Item 310(b) of Regulation S-B and, therefore, do not include all information and disclosure necessary for a complete presentation of financial position, results of operations, cash flows, and stockholders equity (deficiency) in conformity with generally accepted accounting principles. In the opinion of management, all adjustments considered necessary for a fair presentation of the results of operations and financial position have been included and all such adjustments are of a normal recurring nature. Operating results for the six months ended October 31, 2003, are not necessarily indicative of the results that can be expected for the year ending April 30, 2004.





Balance sheet information as of April 30, 2003, should be read in conjunction with the consolidated financial statements for the year then ended included in the Companys annual report on form 10-QSB, from which it was derived.





The financial statements present the activities of Legal Access Technologies, Inc. ("LATI") and its subsidiaries Tele-Lawyer, Inc. ("Tele-Lawyer") and Perspectives Health Management Corp. (Note 3). All significant inter-company balances and transactions have been eliminated in the consolidation.





2. Going concern contingency.





As more fully discussed in Item 2, Managements Discussion and Analysis of Financial Condition and Results of Operations, the Companys cash resources are fully exhausted, and several loans and the deferral of officers salaries from the president were required over the past several months. In addition, a summary judgment in favor of the note holder in the amount of $203,500 plus accrued interest ($56,314 through October 31, 2003) has been entered against the Company. The note holder has agreed to forego collection efforts through January 2004 in exchange for a number of partial interim payments. These conditions indicate that the Company may be unable to continue as a going concern. Managements plans in this regard are also described in Item 2 herein. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.





3. Restatement of financial statements.





The Company expected to settle, at no gain or loss, $333,000 of accrued salaries owed to its officers by the transference of 100% of the outstanding stock of one of the Companys subsidiaries. The settlement was approved by the Companys Board of Directors and given effect based on that expectation in the Companys financial statements as of and for the periods ended October 31, 2003, that were included in its Quarterly Report on Form 10QSB, for the quarter then ended as originally filed. As a result of then unforeseen potential tax consequences and other matters, the settlement was never consummated, and the Companys October 31, 2003 financial statements included herein have been restated to include the liability for accrued officers salaries and the net assets of the subsidiary on a consolidated basis. Not withstanding the settlement was originally reported at no gain or loss, the restatement had the effect of increasing the previously reported net loss for the periods by $104,197, net loss per share by $0.02 as a result of reconsideration of an allowance for uncollectible receivables of the subsidiary, and a decrease in shareholders equity deficiency by $15,000.








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ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS





Overview





Historically, as part of a subsidiarys operations, we have been in the business of arranging for the provision of legal advice and information to consumers of legal services through licensed attorneys. We also produce and sell specialized phone conferencing applications to professionals and associations. The specialized phone conference applications are most often in the form of continuing education programs for attorneys called "Tele-Seminars".





Over the past few years, we have changed our business focus by concentrating on sales of technology and services to, and the development of strategic partnerships with, various non-profit associations and government agencies in order to create a number of statewide hubs for access to legal services. Unfortunately, our plans have taken longer than expected and we have experienced significant barriers. Management attributes the delays to the difficulties encountered in the development of the software, slow response by clients and insufficient resources necessary to support the development and hosting of the products. Management has also  discovered that a potential major cause of our difficulties appears to be as a result of certain individuals employed by a government agency that funds legal service organizations or a competitor, improperly and wrongfully disparaging our products and services. These individuals, ostensibly working on behalf of the government agency, are also believed to have threatened certain of our clients with termination of future funding if they didnt cease use of our technology. Management is reviewing our rights and options with legal counsel and will determine what actions, if any, are to be taken against such individuals and their employers in the near future.





On April 28, 2003, we abandoned the case management system and have since been continually re-evaluating our business focus and cutting our operating costs.





As a result of these problems and the resulting delays, we have largely exhausted our cash reserves and have been seeking additional funding and alternative business opportunities. In order to conserve cash resources, efforts to expand the client/affiliate network of Legal Services have been suspended. Management is currently evaluating a long-term strategy for this component of the business. We currently service legal service organizations in Nevada, Ohio, Illinois, Pennsylvania, Tennessee, Kentucky, Florida and Maryland. We have also cut costs and reduced staff by approximately 80% from last year.





On October 5, 2003, we expected to settle, at no gain or loss, $333,000 of accrued salaries owed to certain of our officers by the transference of our 100% ownership interest in our subsidiary, Perspectives Health Management Corporation. While this was approved by our Board of Directors, because of certain previously unanticipated tax consequences and uncertainties regarding the collectibility of the receivables the settlement was never consummated, and our October 31, 2003, financial statements have been restated to reverse the previously recorded effect of the expected settlement. (See Note 3 to the financial statements.) Moreover, our President and Chief Executive Officer, Kyleen Elisabeth Cane, has made a series of supporting loans to us in order to cover our costs of operations. These loans are secured against our assets and the assets of our remaining subsidiary.





Management notes that without additional financing, the future of our business is uncertain. These





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conditions indicate that we may be unable to continue as a going concern.








Management is currently reviewing several options including a total withdrawal from providing services to non-profit legal service organizations over time. Management is also in the process of evaluating other business opportunities both within and outside of the legal services market. Details of managements plans follow under "Liquidity and Capital Resources".





Liquidity and Capital Resources





As a result of managements search for new business opportunities, on September 9, 2003, we entered into a memorandum of understanding for the purchase of all the common stock of American Design Group, Inc., a California company ("ADGI") that manufactures and imports personal electronic products into the United States. A definitive Common Stock Purchase Agreement was signed with ADGI on September 25, 2003, specifically contingent upon our arranging for a convertible bridge loan for ADGI in the amount of $500,000 and arranging for long-term financing of $5,000,000.





We advanced $25,000 of the required bridge loan financing and Pacific Commercial Group, LLC ("Pacific") independently provided an additional $207,500 loan directly to ADGI prior to entering into an Amendment to the Common Stock Purchase Agreement ("Amended ADGI Agreement") with ADGI on November 17, 2003. Under the Amended ADGI Agreement, we have agreed to issue up to 4,360,000 shares of our common stock to ADGIs shareholders in exchange for the delivery of 90% to 100% of the shares of ADGI. In addition, the ADGI shareholders are entitled to up to 4,200,000 shares of our common stock as an earn-out based on their EBITDA over the next three years. The entire text of the Amended ADGI Agreement is attached to our 8K filed with the Securities and Exchange Commission on November 26, 2003.





On September 25, 2003, we also signed a Stock Purchase Agreement ("Pacific Agreement") with Pacific to sell Pacific 6,000,000 shares of our common stock for $5,000,000 by November 30, 2003. On November 19, 2003, with the assistance of Pacific, we negotiated and entered into a Regulation S Stock Purchase Agreement ("Aurora Agreement") with Aurora Two Ltd. ("Aurora") in which Aurora agreed to purchase up to 12,000,000 shares of our common stock in a foreign transaction to be valued based on market prices. We have protected our stock position by limiting the purchasing power under this agreement to minimum floor prices. On November 21, 2003, Aurora issued a purchase order for the entire 12,000,000 shares.





On November 19, 2003, we also entered into a settlement agreement with Pacific to terminate the Pacific Agreement in favor of the Aurora Agreement ("Pacific Settlement Agreement"). Under this agreement, Pacific will receive a portion of the share price obtained through the Aurora Agreement in exchange for its release of its contract purchase rights as provided in the Pacific Agreement.





We expect our negative cash flows to decrease over the coming quarter due to a number of cost cutting actions taken by our management, including a reduction in personnel and buy out of our expensive lease of our office space. However, we also expect to continue negative cash flows from our operating activities and expect our cash resources to be exhausted without additional debt or equity financing. Management is currently working to raise additional capital through the sale of our equity securities under the Aurora Agreement discussed above, while working on the acquisition of a new business opportunity.






7






Critical Accounting Policies and Estimates





The Company does not employ any critical accounting policies or estimates that are either selected from among available alternatives or require the exercise of significant management judgment to apply.





Results of Operations





Revenue growth has been slowed by the longer than expected time to develop and implement our technology products and services. We received revenues of $250,620, during the six months ended October 31, 2003, compared to revenue of $336,324, during the same six months of the prior year. Although the case management system has been completed, due to a number of factors including possible interference by certain government employees as well as the longer than expected testing and implementation periods and time required to stabilize the product, many of our legal service organization clients have not been fully activated and all but one have cancelled their contracts with us. The revenues from this contract are not material and are included in discontinued operations.





Operating expenses were $584,692 during the six month period ended October 31, 2003, and $620,324, during the same six months of the prior year. The decrease in these expenses over the comparative periods reflects our continual efforts to reduce costs while maintaining the same level of service. We incurred $186,016 in legal support service expenses during the six month period ended October 31, 2003, and $324,073 during the same six months of the prior year. As a result, we showed a net loss from continuing operations of $569,491 as compared to a loss of $1,059,734 during the same period of the prior fiscal year.





We have stopped making any substantial investment in the development of our software products, focusing instead on the implementation of our web-based systems for our existing clients and new business opportunities.








Forward Looking Statements





The information contained in this section and elsewhere may at times represent management's best estimates of our future financial and technological performance, based upon assumptions believed to be reasonable. Management makes no representation or warranty, however, as to the accuracy or completeness of any of these assumptions, and nothing contained in this document should be relied upon as a promise or representation as to any future performance or events. Our ability to accomplish these objectives and whether or not it will be financially successful is dependent upon numerous factors, each of which could have a material effect on the results obtained. Some of these factors are within the discretion and control of management and others are beyond management's control. Management considers the assumptions and hypothesis used in preparing any forward looking assessments of profitability contained in this document to be reasonable; however, we cannot assure investors that any projections or assessments contained in this document, or otherwise made by management, will be realized or achieved at any level.





ITEM 3. CONTROLS AND PROCEDURES


As required by Rule 13a-15 under the Securities Exchange Act of 1934 (the "Exchange Act"), we carried out an evaluation of the effectiveness of the design and operation of our disclosure controls





8


and procedures as of October 31, 2003. This evaluation was carried out under the supervision and with the participation of our Chief Executive and Financial Officer, Ms. Kyleen Cane. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are effective in timely alerting management to material information required to be included in our periodic SEC filings. There have been no significant changes in our internal controls or in other factors that could significantly affect internal controls subsequent to the date we carried out our evaluation.





Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted 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. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.






9







PART II - OTHER INFORMATION





ITEM 1. LEGAL PROCEEDINGS





1. Westminster Agencies, Ltd.





On or about September 9, 2003, Westminster Agencies, Ltd. ("Westminster") obtained a judgment against us in the amount of $276,955, representing repayment of the principal on our promissory note to Westminster. Post judgment to date, we have paid $20,000 to Westminster on this judgment and have agreed to pay $5,000 per month through January, when management anticipates obtaining sufficient funding to settle the remainder of this judgment through the Aurora Agreement. Through this time period, and subject to the payments being made on the 15 th of each month, Westminster has agreed to defer any collection activities on the judgment. Management is also reviewing its other options with counsel in the event that it is unable to obtain sufficient funding to settle this matter satisfactorily in January.





2. Jost Steinbruchel





On or about October 6, 2003, we obtained a summary judgment in the Nevada District Court against Jost Steinbruchel in the amount of $18,500 plus interest, costs and fees. Mr. Steinbruchel has entered a motion to set aside his default. The motion is set for hearing in January 2004.





ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS





We issued 160,000 shares of our common stock to a consultant upon his exercise of his option to purchase shares under our 2001 stock option plan.





ITEM 3. DEFAULT UPON SENIOR SECURITIES





None





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





None





ITEM 5. OTHER INFORMATION





None





10





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





(a)  Exhibits:





Exhibit Number
Description of Exhibit31.1



32.1
Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant
toSection 302 of the Sarbanes-Oxley Act of 2002

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





(b) Reports on Form 8-K:








Report on form 8K concerning our agreement for the acquisition of American Design Group and Regulation S stock sale agreement with Aurora Two Ltd, filed November 26, 2003.




11








SIGNATURES




Pursuant to the requirements 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.





Legal Access Technologies, Inc.








By: /s/ Kyleen  Cane


Kyleen E. Cane,


President and Chief Executive Officer


Dated: March 15, 2004








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