UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549







FORM 10-QSB



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|----- | -----------------------------------------------------------------------------------
|[ X ] | QUARTERLY REPORT UNDER SECTION 13 0R 15( d ) OF THE SECURITIES EXCHANGE ACT OF 1934



For the quarterly period ended   June 30, 2006



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|--- | ------------------------------------------------------------------------------------
|[ ] | TRANSITION REPORT UNDER SECTION 13 0R 15( d ) OF THE SECURITIES EXCHANGE ACT OF 1934



For the transition period from________________ to__________________





Commission file number 000-30919





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|PROSPERO MINERALS CORP.                                          
|(Exact name of small business issuer as specified in its charter)





|                                                                                                         |                                                
|-------------------------------------------------------------------------------------------------------- | -----------------------------------------------
|Incorporated in the State of Nevada
(State or other jurisdiction of incorporation or organization)       | 33-1059313
(I.R.S. Employer Identification No.)
|575 Madison Avenue, 10 th Floor, New York, New York, 10022-2511
(Address of principal executive offices)
|212-937-8442
(Issuers telephone number)                                                                
|(Former name, former address and former fiscal year, if changed since last report)                      





APPLICABLE ONLY TO CORPORATE ISSUERS



State the number of shares outstanding of each of the issuers classes of common equity, as of the latest practicable date.

|                                 |                               
|-------------------------------- | ------------------------------
|Class                            | Outstanding at August 12, 2006
|Common Stock - $0.0001 par value | 89,468,911                    



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





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PART I - FINANCIAL INFORMATION



Item 1.   Financial Statements.



Prospero Minerals Corp.s unaudited financial statements for the three months ended June 30, 2006 are included with this Form 10-QSB. The unaudited financial statements for the three months ended June 30, 2006 include:



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|--- | -----------------------------------------------------------------------
|(a) | Condensed Consolidated Balance Sheets:
June 30, 2006 and March 31, 2006



|    |                                                                                                                                                              
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------
|(b) | Condensed Consolidated Statements of Losses:
Three Months Ended June 30, 2005 and 2004
For the period July 23, 2002 (Date of Inception) through June 30, 2006



|    |                                                                                                                                               
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------
|(c) | Condensed Consolidated Statements of Deficiency in Stockholders Equity
For the period July 23, 2002 (Date of Inception) through June 30, 2006



|    |                                                                                                                                                                 
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------
|(d) | Condensed Consolidated Statement of Cash Flows:
Three Months Ended June 30, 2005 and 2004
For the period July 23, 2002 (Date of Inception) through June 30, 2006



|    |                                                                               
|--- | ------------------------------------------------------------------------------
|(e) | Notes to Unaudited Condensed Consolidated Financial Information:
June 30, 2005



The unaudited financial statements have been prepared in accordance with the instructions to Form 10-QSB and, therefore, do not include all information and footnotes necessary for a complete presentation of financial position, results of operations, cash flows, and stockholders equity 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 three months ended June 30, 2006 are not necessarily indicative of the results that can be expected for the fiscal year ending March 31, 2006. The financial statements have been reviewed and are on file with Prosperos auditor.







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|                                     
|-------------------------------------
|PROSPERO MINERALS CORP.              
|(A DEVELOPMENT STAGE COMPANY)        
|CONDENSED CONSOLIDATED BALANCE SHEETS



|                                                                                                                                                              |  |             |               |             |   |                |  
|------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------- | ------------- | ----------- | - | -------------- | -
|                                                                                                                                                              | 
|                                                                                                                                                              |  | (Unaudited) |               | (Unaudited) |  
|                                                                                                                                                              |  |             | June 30, 2006 |             |   | March 31, 2006 |  
|ASSETS                                                                                                                                                        |  |             |               |             |   |                |  
|CURRENT ASSETS:                                                                                                                                               |  |             |               |             |   |                |  
|Cash and cash equivalent                                                                                                                                      |  | $           | 3,427         |             | $ | 53, 855        |  
|Accounts Receivable                                                                                                                                           |  | $           | 6,000         |             | $ | 40,000         |  
|Deposit                                                                                                                                                       |  | $           | 400           |             | $ | 400            |  
|Total                                                                                                                                                         |  | $           | 9,827         |             | $ | 94,255         |  
|Capital Assets                                                                                                                                                |  | $           | 413,024       |             | $ | 423618         |  
|                                                                                                                                                              |  |             |               |             |   |                |  
|Total assets                                                                                                                                                  |  | $           | 422,851       |             | $ | 517,873        |  
|                                                                                                                                                              |  |             |               |             |   |                |  
|LIABILITIES AND (DEFICIENCY IN) STOCKHOLDERS' EQUITY                                                                                                          |  |             |               |             |   |                |  
|CURRENT LIABILITIES:                                                                                                                                          |  |             |               |             |   |                |  
|Accounts payable and accrued liabilities                                                                                                                      |  | $           | 499,860       |             | $ | 122,147        |  
|Advances from related parties (Note B)                                                                                                                        |  | $           | 228,481       |             | $ | 170,779        |  
|Total current liabilities                                                                                                                                     |  | $           | 728,341       |             | $ | 283,226        |  
|                                                                                                                                                              |  |             |               |             |   |                |  
|COMMITMENTS AND CONTINGENCIES                                                                                                                                 |  |             | -             |             |   | -              |  
|                                                                                                                                                              |  |             |               |             |   |                |  
|(DEFICIENCY IN) STOCKHOLDERS' EQUITY                                                                                                                          |  |             |               |             |   |                |  
|Preferred Stock, par value $.001 per share; 10,000,000 shares authorized; none issued and outstanding at June 30, 2006 and March 31, 2006. (Note C)           |  |             |               |             |   |                |  
|Common stock, par value $.001 per share; 90,000,000 shares authorized; 89,468,911 shares issued and outstanding at June 30, 2006 and March 31, 2006. (Note C) |  |             | 89,469        |             |   | 89,271         |  
|Additional paid-in-capital                                                                                                                                    |  |             | 720,861       |             |   | 429,466        |  
|Shares Subscribed                                                                                                                                             |  |             |               |             |   | 227,116        |  
|Accumulated deficit during development stage                                                                                                                  |  |             | (1,115,820    | )           |   | (511,206       | )
|(Deficiency in) stockholders' equity                                                                                                                          |  |             | (305,490      | )           |   | 234,647        |  
|                                                                                                                                                              |  |             |               |             |   |                |  
|Total Liabilites and (Deficiency in) Stockholders' Equity                                                                                                     |  | $           | 422,851       |             | $ | 517,873        |  









See accompanying notes to the unaudited condensed consolidated financial information





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|                                           
|-------------------------------------------
|PROSPERO MINERALS CORP.                    
|(A DEVELOPMENT STAGE COMPANY)              
|CONDENSED CONSOLIDATED STATEMENTS OF LOSSES



|                                                    |  |                                    |            |                                                                             |   |           |   |   |             | 
|--------------------------------------------------- |  | ---------------------------------- | ---------- | --------------------------------------------------------------------------- | - | --------- | - | - | ----------- | 
|                                                    |  | For the three months ended June 30 |            | For the period from July 23, 2002 (date of inception) through
June 30, 2006 |  
|                                                    |  |                                    | 2006       |                                                                             |   | 2005      |   |   |             | 
|Costs and Expenses:                                 |  |                                    |            |                                                                             |   |           |   |   |             | 
|General and Administrative                          |  | $                                  | 341,172    |                                                                             | $ | 17,866    |   | $ | (1,115,820) | 
|Mineral Expiration                                  |  | $                                  | 263,442    |                                                                             |   |           |   |   |             | 
|Total Operating Expense                             |  |                                    | 604,614    |                                                                             |   | 17,866    |   |   | (1,115,820) | 
|                                                    |  |                                    |            |                                                                             |   |           |   |   |             | 
|Loss from Operations                                |  |                                    | 604,614    |                                                                             |   | 17,866    |   |   | (1,115,820) | 
|                                                    |  |                                    |            |                                                                             |   |           |   |   |             | 
|Provision for Income Tax                            |  |                                    | -          |                                                                             |   | -         |   |   | -           | 
|                                                    |  |                                    |            |                                                                             |   |           |   |   |             | 
|Net Loss                                            |  | $                                  | 604,614    |                                                                             | $ | 17,866    |   | $ | (1,115,820) | 
|                                                    |  |                                    |            |                                                                             |   |           |   |   |             | 
|Loss per common share (basic and assuming dilution) |  | $                                  | (0.01      | )                                                                           | $ | (0.00     | ) |   |             | 
|                                                    |  |                                    |            |                                                                             |   |           |   |   |             | 
|Weighted average common shares outstanding          |  |                                    | 89,369,706 |                                                                             |   | 9,270,500 |   |   |             | 









See accompanying notes to the unaudited condensed consolidated financial information





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|                                                                       
|-----------------------------------------------------------------------
|PROSPERO MINERALS CORP.                                                
|(A DEVELOPMENT STAGE COMPANY)                                          
|CONDENSED CONSOLIDATED STATEMENTS OF DEFICIENCY IN STOCKHOLDERS' EQUITY
|FOR THE PERIOD JULY 23, 2002 (DATE OF INCEPTION) TO JUNE 30, 2006      



|                                                                        |  |  |               |  |   |              |  |   |                            |  |   |                                              |   |   |           |  
|----------------------------------------------------------------------- |  |  | ------------- |  | - | ------------ |  | - | -------------------------- |  | - | -------------------------------------------- | - | - | --------- | -
|                                                                        |  |  | Common Shares |  |   | Stock Amount |  |   | Additional Paid-in Capital |  |   | Deficit Accumulated During Development Stage |   |   | Total     |  
|Issuance of common stock in July 2002 for cash at $0.01 per share       |  |  | 5,500,000     |  | $ | 5,500        |  | $ | 49,500                     |  | $ | -                                            |   | $ | 55,000    |  
|Shares issued in August 2002 for cash at $.01 per share, net of costs   |  |  | 3,760,000     |  |   | 3,760        |  |   | 33,840                     |  |   | -                                            |   |   | 37,600    |  
|Shares issued in February 2003 for cash at $.50 per share, net of costs |  |  | 10,500        |  |   | 11           |  |   | 5,526                      |  |   | -                                            |   |   | 5,537     |  
|Net Loss                                                                |  |  | -             |  |   | -            |  |   | -                          |  |   | (5,324                                       | ) |   | (5,324    | )
|Balance at March 31, 2003                                               |  |  | 9,270,500     |  |   | 9,271        |  |   | 88,866                     |  |   | (5,324                                       | ) |   | 92,813    |  
|Net loss                                                                |  |  | -             |  |   | -            |  |   | -                          |  |   | (86,266                                      | ) |   | (86,266   | )
|Balance at March 31, 2004                                               |  |  | 9,270,500     |  | $ | 9,271        |  | $ | 88,866                     |  | $ | (91,590                                      | ) | $ | 6,547     |  
|Net loss                                                                |  |  | -             |  |   | -            |  |   | -                          |  |   | (62,076                                      | ) |   | (62,076   | )
|Balance at March 31, 2005                                               |  |  | 9,270,500     |  | $ | 9,271        |  | $ | 88,866                     |  | $ | (153,666                                     | ) | $ | (55,529   | )
|Net loss                                                                |  |  | -             |  |   | -            |  |   | -                          |  |   | (17,886                                      | ) |   | (17,886   | )
|Balance at June 30, 2005                                                |  |  | 9,270,500     |  | $ | 9,271        |  | $ | 88,866                     |  | $ | (171,552                                     | ) | $ | (73,415   | )
|Net Loss                                                                |  |  |               |  |   |              |  |   |                            |  | $ | (339,654)                                    |   | $ | (339,654) |  
|Shares Issued Upon Asset Subscription                                   |  |  | 80,000        |  |   | 80,000       |  |   | 340,600                    |  |   |                                              |   |   | 420,600   |  
|Balance at March 31, 2006                                               |  |  | 89,270,500    |  |   | 89,271       |  |   | 429,466                    |  |   | (511,206)                                    |   |   | 7,531     |  
|Net Loss                                                                |  |  |               |  |   |              |  |   |                            |  |   | (604,614)                                    |   |   | (604,614) |  
|Shares Issued                                                           |  |  | 198,441       |  |   | 198          |  |   | 291,395                    |  |   |                                              |   |   | 291,593   |  
|Balance at June 30, 2006                                                |  |  | 89,468,911    |  |   | 89,469       |  |   | 720,861                    |  |   | (1,115,820)                                  |   |   | (305,490) |  
|                                                                        |  |  |               |  |   |              |  |   |                            |  |   |                                              |   |   |           |  









See accompanying notes to the unaudited condensed consolidated financial information





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|                                               
|-----------------------------------------------
|PROSPERO MINERALS CORP.                        
|(A DEVELOPMENT STAGE COMPANY)                  
|CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS



|                                                                                                           |  |                                    |          |                                                                             |   |         |   |   |            |  
|---------------------------------------------------------------------------------------------------------- |  | ---------------------------------- | -------- | --------------------------------------------------------------------------- | - | ------- | - | - | ---------- | -
|                                                                                                           |  | For the three months ended June 30 |          | For the period from July 23, 2002 (date of inception) through
June 30, 2006 |  
|                                                                                                           |  |                                    | 2006     |                                                                             |   | 2005    |   |  
|INCREASE (DECREASE) IN CASH AND EQUIVALENTS                                                                |  |                                    |          |                                                                             |   |         |   |   |            |  
|CASH FLOWS FROM OPERATING ACTIVITIES:                                                                      |  |                                    |          |                                                                             |   |         |   |   |            |  
|Net loss from development stage operations                                                                 |  | $                                  | (604,614 | )                                                                           | $ | (17,886 | ) | $ | (1,115,820 | )
|Depreciation                                                                                               |  |                                    | 10,594   |                                                                             |   |         |   |   | 10,594     |  
|Adjustments to reconcile net loss from development stage operations to cash used for operating activities: |  |                                    |          |                                                                             |   |         |   |   |            |  
|Changes in assets and liabilities:                                                                         |  |                                    |          |                                                                             |   |         |   |   |            |  
|Accounts Receivable                                                                                        |  |                                    | 34,000   |                                                                             |   |         |   |   | 34,000     |  
|Accounts payable and accrued expenses                                                                      |  |                                    | 387,413  |                                                                             |   | (8,084) |   |   | 499,860    |  
|NET CASH (USED IN) OPERATING ACTIVITIES                                                                    |  |                                    | (172,607 | )                                                                           |   | (25,970 | ) |   | (571,366   | )
|                                                                                                           |  |                                    |          |                                                                             |   |         |   |   |            |  
|CASH FLOWS FROM FINANCING ACTIVITIES:                                                                      |  |                                    |          |                                                                             |   |         |   |   |            |  
|Proceeds from sale of common stock and stock subscription, net of costs                                    |  |                                    | 64,477   |                                                                             |   | -       |   |   | 810,330    |  
|Proceeds from related parties advances, net of repayments                                                  |  |                                    | 57,702   |                                                                             |   | 21,161  |   |   | 235,537    |  
|NET CASH PROVIDED BY FINANCING ACTIVITIES                                                                  |  |                                    | 122,179  |                                                                             |   | 21,161  |   |   | 574,793    |  
|                                                                                                           |  |                                    |          |                                                                             |   |         |   |   |            |  
|NET (DECREASE) INCREASE IN CASH AND EQUIVALENTS                                                            |  |                                    | (50,428  | )                                                                           |   | (4809   | ) |   | 3,427      |  
|                                                                                                           |  |                                    |          |                                                                             |   |         |   |   |            |  
|Cash and cash equivalents at the beginning of the period                                                   |  |                                    | 53,855   |                                                                             |   | 5,338   |   |   | -          |  
|                                                                                                           |  |                                    |          |                                                                             |   |         |   |   |            |  
|Cash and cash equivalents at the end of the period                                                         |  | $                                  | 3,427    |                                                                             | $ | 529     |   | $ | 3427       |  
|                                                                                                           |  |                                    |          |                                                                             |   |         |   |   |            |  
|                                                                                                           |  |                                    |          |                                                                             |   |         |   |   |            |  
|Supplemental Disclosures of Cash Flow Information                                                          |  |                                    |          |                                                                             |   |         |   |   |            |  
|Cash paid during the period for interest                                                                   |  | $                                  | -        |                                                                             | $ | -       |   | $ | -          |  
|Income taxes paid                                                                                          |  |                                    | -        |                                                                             |   | -       |   |   | -          |  









See accompanying notes to the unaudited condensed consolidated financial information





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PROSPERO MINERALS CORP.

(A Development Stage Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL INFORMATION

JUNE 30, 2006

(unaudited)



NOTE A-SUMMARY OF ACCOUNTING POLICIES



General



The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-QSB. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.



In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Accordingly, the results from operations for the three month period ended June 30, 2006, are not necessarily indicative of the results that may be expected for the year ended March 31, 2007. The unaudited condensed consolidated financial statements should be read in conjunction with the consolidated March 31, 2006 financial statements and footnotes thereto included in the Company's SEC Form 10-KSB.



Business and Basis of Presentation



Prospero Minerals Corp. (the Company) was reincorporated under the laws of the State of Nevada on July 23, 2002. On May 2003, the Company acquired all of the issued and outstanding shares of CMC Exploration Corp., a British Columbia company. At June 30, 2006 CMC Exploration Corp was dormant. The Company has been in the gold, silver and other mineral exploration business since its formation. The Company has not commenced significant operations and is considered a development stage Company, as defined by Statement of Financial Accounting Standards No. 7 (SFAS 7). To date the Company has not generated any revenues, has incurred expenses, and has sustained losses. Consequently, its operations are subject to all risks inherent in the establishment of a new business enterprise. For the period from inception through June 30, 2006, the Company has accumulated losses of $1,115,820.



The consolidated financial statements include the accounts of Prospero Minerals Corp. and its wholly-owned subsidiary, CMC Exploration Corp. Significant intercompany transactions and accounts have been eliminated in consolidation.



Reclassifications



Certain reclassifications have been made in prior years financial statements to conform to classifications used in the current year.



Stock Based Compensation



In December 2002, the FASB issued Statement of Financial Accounting Standards No. 148 (SFAS No. 148), Accounting for Stock-Based Compensation-Transition and Disclosure-an amendment of SFAS 123. This statement amends SFAS No. 123, Accounting for Stock-Based Compensation, to provide alternative methods of transition for a voluntary change to the fair value based method of accounting for stock-based employee compensation. In addition, this statement amends the disclosure requirements of SFAS No. 123 to require prominent disclosures in both annual and interim financial statements about the method of accounting for stock-based employee compensation and the effect of the method used on reported results. The Company has chosen to continue to account for stock-based compensation using the intrinsic value method prescribed in APB Opinion No. 25 and related interpretations.







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PROSPERO MINERALS CORP.

(A Development Stage Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL INFORMATION

JUNE 30, 2005

(unaudited)



NOTE A-SUMMARY OF ACCOUNTING POLICIES (Continued)



Stock Based Compensation (Continued)



Accordingly, compensation expense for stock options is measured as the excess, if any, of the fair market value of the Company's stock at the date of the grant over the exercise price of the related option. The Company has adopted the annual disclosure provisions of SFAS No. 148 in its financial reports for the year ended March 31, 2006 and 2005 and will adopt the interim disclosure provisions for its financial reports for the subsequent periods. The Company has no awards of stock-based employee compensation outstanding at June 30, 2006.



On December 16, 2004, the Financial Accounting Standards Board (FASB) issued FASB Statement No. 123R (revised 2004), Share-Based Payment which is a revision of FASB Statement No. 123, Accounting for Stock-Based Compensation. Statement 123R supersedes APB opinion No. 25, Accounting for Stock Issued to Employees, and amends FASB Statement No. 95, Statement of Cash Flows. Generally, the approach in Statement 123R is similar to the approach described in Statement 123. However, Statement 123R requires all share-based payments to employees, including grants of employee stock options, to be recognized in the income statement based on their fair values. Pro-forma disclosure is no longer an alternative. On April 14, 2005, the SEC amended the effective date of the provisions of this statement. The effect of this amendment by the SEC is that the Company will have to comply with Statement 123R and use the Fair Value based method of accounting no later than the its last quarter of fiscal 2006. Management has not determined the impact that this statement will have on Company's consolidated financial statements.



Segment Information



Statement of Financial Accounting Standards No. 131, Disclosures about Segments of an Enterprise and Related Information (SFAS 131) establishes standards for reporting information regarding operating segments in annual financial statements and requires selected information for those segments to be presented in interim financial reports issued to stockholders. SFAS 131 also establishes standards for related disclosures about products and services and geographic areas. Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, or decision-making group, in making decisions how to allocate resources and assess performance. The information disclosed herein materially represents all of the financial information related to the Companys principal operating segment.



New Accounting Pronouncements



In March 2005, the FASB issued FASB Interpretation (FIN) No. 47, Accounting for Conditional Asset Retirement Obligations, an interpretation of FASB Statement No. 143, which requires an entity to recognize a liability for the fair value of a conditional asset retirement obligation when incurred if the liabilitys fair value can be reasonably estimated. The Company is required to adopt the provisions of FIN 47 no later than the last quarter of its fiscal 2006. The Company does not expect the adoption of this Interpretation to have a material impact on its consolidated financial position, results of operations or cash flows.





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PROSPERO MINERALS CORP.

(A Development Stage Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL INFORMATION

JUNE 30, 2006

(unaudited)



NOTE A-SUMMARY OF ACCOUNTING POLICIES (Continued)



New Accounting Pronouncements (Continued)



In May 2005 the FASB issued Statement of Financial Accounting Standards (SFAS) No. 154, Accounting Changes and Error Corrections, a replacement of APB Opinion No. 20 and FASB Statement No. 3. SFAS 154 requires retrospective application to prior periods financial statements for changes in accounting principle, unless it is impracticable to determine either the period-specific effects or the cumulative effect of the change. SFAS 154 also requires that retrospective application of a change in accounting principle be limited to the direct effects of the change. Indirect effects of a change in accounting principle, such as a change in non-discretionary profit-sharing payments resulting from an accounting change, should be recognized in the period of the accounting change. SFAS 154 also requires that a change in depreciation, amortization, or depletion method for long-lived, non-financial assets be accounted for as a change in accounting estimate effected by a change in accounting principle. SFAS 154 is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005. Early adoption is permitted for accounting changes and corrections of errors made in fiscal years beginning after the date this Statement is issued. The Company does not expect the adoption of this SFAS to have a material impact on its consolidated financial position, results of operations or cash flows.





NOTE B - ADVANCES FROM RELATED PARTIES





During the three months ended June 30, 2006 and the year ended March 31, 2006, entities controlled by the Companys directors advanced funds to the Company for working capital purposes. Total amount due to related parties amounted $228,461 and $170,779 at June 30, 2006 and March 31, 2006, respectively. The amounts advanced are unsecured, non-interest bearing and have no specific terms of repayment.





NOTE C - CAPITAL STOCK





The Company is authorized to issue 10,000,000 shares of preferred stock with par value $.001 per share, and 90,000,000 shares of common stock with par value of $.001 per share. As of June 30, 2006 and March 31, 2006, the Company has no preferred stock issued and outstanding. The Company has 89,468,911 and 89,270,500 shares of common stock issued and outstanding at June 30, 2006 and March 31, 2006 respectively.





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Item 2. Managements Discussion and Analysis or Plan of Operation.



THE FOLLOWING PRESENTATION OF MANAGEMENTS DISCUSSION AND ANALYSIS OF PROSPERO MINERALS CORP. SHOULD BE READ IN CONJUNCTION WITH THE FINANCIAL STATEMENTS AND OTHER FINANCIAL INFORMATION INCLUDED HEREIN.



Forward Looking Statements



This report on Form 10-QSB contains certain forward-looking statements within the meaning of Section 21e of the Securities Exchange Act of 1934 , as amended, and other applicable securities laws. All statements other than statements of historical fact are  forward-looking statements  for purposes of these provisions, including any projections of earnings, revenues, or other financial items; any statements of the plans, strategies, and objectives of management for future operation; any statements concerning proposed new products, services, or developments; any statements regarding future economic conditions or performance; statements of belief; and any statement of assumptions underlying any of the foregoing. Such forward-looking statements are subject to inherent risks and uncertainties, and actual results could differ materially from those anticipated by the forward-looking statements.



Overview



Prospero was incorporated under the laws of the State of Nevada on July 23, 2002.



Prospero is an exploration stage company engaged in the acquisition and exploration of mineral properties.  Prosperos plan of operations is to conduct mineral exploration activities on the mineral properties in order to assess whether these claims possess commercially exploitable mineral deposits.  Prosperos exploration program is designed to explore for commercially viable deposits of base and precious minerals, such as gold, diamonds, silver, lead, barium, mercury, copper, and zinc minerals.  See Business of Prospero and Managements Discussion and Analysis or Plan of Operations below for more information.



On June 20, 2006, Prospero Minerals Corp. announced its name change from Corumel Minerals Corp. to Prospero Minerals Corp. and increased its authorized capital.



Prospero acquired 100% ownership in CMC Exploration Corporation, which was incorporated under the name 660289 B.C. Ltd. under the laws of the Province of British Columbia on December 17, 2002 ( CMC ).   CMC changed its name to CMC Exploration Corporation on June 12, 2003.  CMC was formed for the purpose of carrying out Prosperos mineral exploration program in British Columbia.  Prospero indirectly owns through CMC a 100% interest in six mineral claims (the  Thor Claims ).  On May 23, 2003, Prospero transferred all of its 100% ownership interest in the Thor Claims to CMC.  See Exhibit 10.2  Transfer of Interest Agreement for more information.



Neither Prospero nor its subsidiaries have been involved in any bankruptcy, receivership or similar proceedings.  There have been no material reclassifications, mergers, consolidations or purchases or sales of a significant amount of assets not in the ordinary course of Prosperos business.



Due to a lack of funding, Prospero was largely dormant during the three months ended June 30, 2006 and carried on minimal business, consisting of primarily administrative. Prospero did not carry on any work related to the Thor Group mineral claims.



Results of Operations



Prospero did not earn any revenues from inception through the reporting period ending June 30, 2006. Prospero does not anticipate earning revenues until such time as it has entered into commercial production of its mineral properties. Prospero has deferred the proposed drilling program on the Thor Group mineral claims until it has sufficient funding to proceed. Prospero has not yet determined whether the results of Phase 1 claims of the mineral exploration program on the Thor Group mineral are sufficiently positive to enable Prospero to proceed with further exploration programs. Prospero can provide no assurance that it will discover commercially exploitable levels of mineral resources on its properties, or if such resources are discovered, that Prospero will enter into commercial production of its mineral properties.



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Prospero incurred expenses in the amount of $604,614 for the three month period June 30, 2006. From the period on inception on July 23, 2002 to June 30, 2006, Prospero incurred expenses in the amount of $1,115,820. These operating expenses were primarily related to   professional fees in connection with Prosperos corporate organization relating to audit fees and legal fees. Prospero anticipates its operating expenses will increase as it undertakes its plan of operations, provided further exploration is recommended. This increase will be attributable to further geological exploration and the professional fees associated with complying with the reporting requirements under the Securities Exchange Act of 1934 .



Prospero incurred a loss in the amount of $604,614 for the three month period ended June 30, 2006 and a loss in the amount of $1,115,820 for the period from inception of July 23, 2002 through June 30, 2006. Prosperos loss was entirely attributable to general and administrative expenses, which included operating expenses and professional fees.



Liquidity and Capital Resources



Prospero had cash of $3427 as of June 30, 2006, compared to cash in the amount of $53,855 as of its fiscal year end on March 31, 2006. Prospero had a working capital deficiency of $718,514 as of June 30, 2006, compared to working capital of $188,971 as of March 31, 2006. Prosperos liabilities as of June 30, 2006 of $728,341 related to advances from related parties, accounts payable and accrued liabilities, including professional fees for legal and audit services.



Prosperos independent certified public accountants have stated in their report included in Prosperos March 31, 2006 Form 10-KSB, that Prospero has no generated revenues and has incurred operating losses and that Prospero is dependent upon management's ability to develop profitable operations. These factors among others may raise substantial doubt about the Prosperos ability to continue as a going concern.



Prospero had cash in the amount of $3427 as of June 30, 2006. Prosperos total expenditures over the next twelve months are anticipated to be approximately $80,000. Prospero does not have plans to purchase any significant equipment or change the number of its employees during the next twelve months. Accordingly, over the next twelve months, Prospero will need to obtain additional financing in the event that further exploration is recommended.



Critical Accounting Policies



Prosperos discussion and analysis of its financial condition and results of operations, including the discussion on liquidity and capital resources, are based upon its financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. Actual results could differ from those estimates. On an on going basis, management re-evaluates its estimates and judgments, including but not limited to, those related to revenue recognition and collectibility of accounts receivable. Critical accounting policies identified are as follows:



Exploration Stage Activities



Prospero has been in the base and precious mineral exploration business since its formation. Prospero has not commenced significant operations and is considered an exploration stage company.



Principles of Consolidation



The consolidated financial statements include Prosperos accounts and its subsidiarys. All significant intercompany balances and transactions have been eliminated.



Mineral Property Payments and Exploration Costs



Prospero expenses all costs related to the acquisition, maintenance and exploration of mineral claims in which Prospero has secured exploration rights prior to establishment of proven and probable reserves. To date, Prospero has not established the commercial feasibility of its exploration prospects; therefore, all costs are being expensed.



Reclamation and Abandonment Costs



The Financial Accounting Standards Board ( FASB ) issued Statement of Financial Accounting Standards No. 143 ( SFAS 143 ),  Accounting for Asset Retirement Obligations  which addresses financial accounting and reporting for obligations associated with the retirement of tangible long-lived assets and the associated asset retirement costs. This statement establishes a uniform methodology for accounting for estimated reclamation and abandonment costs whereby reclamation and closure costs including site rehabilitation will be recorded at the estimated present value of reclamation liabilities and will increase the carrying amount of the related asset. These reclamation costs will be allocated to expense over the life of the related assets and will be adjusted for changes resulting from the passage of time and revisions to either the timing or the amount of the original present value estimate. Prosperos adoption of SFAS No. 143 did not have a material impact on its operations or financial position.





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Internal and External Sources of Liquidity



Prospero has funded its operations primarily from the issuance of common stock.



Inflation



Prospero does not believe that inflation will have a material impact on its future operations.



Off-Balance Sheet Arrangements



Prospero does not have any off-balance sheet arrangements.



PART II - OTHER INFORMATION



Item 1.

Market Price of and Dividends on the Registrants Common Equity and Related Stockholder Matters



(a)

Market Information



Prosperos shares of common stock have been quoted on the NASD OTC Bulletin Board since October 17, 2005 under the symbol CORU.  Also, from February 5, 2004 to September 21, 2004, Prosperos shares of common stock were quoted on the NASD OTC Bulletin Board under the symbol CORU or CORUE.  Also, from July 22, 2006, Prosperos common shares were quoted on the NASD OTC Bulletin Board under the symbol PSPO or PSPOE. Shares of common stock were traded and bids were posted during that time period.



The table below gives the high and low bid information for each fiscal quarter Prosperos common stock has been quoted.  The bid information was obtained from Pink Sheets LLC and reflects inter-dealer prices, without retail mark-up, mark-down or commission, and may not represent actual transactions, and have not been adjusted for stock dividends or splits.



|                 |       |       |                
|---------------- | ----- | ----- | ---------------
|High & Low Bids 
|Period ended     | High  | Low   | Source         
|14 August 2006   | $1.50 | $1.55 | Pink Sheets LLC
|05 April 2006    | $1.35 | $1.26 | Pink Sheets LLC
|31 March 2006    | $2.15 | $1.26 | Pink Sheets LLC
|31 December 2005 | $2.40 | $1.10 | Pink Sheets LLC



(b)

Holders of Record



There are approximately 1,400 holders of record of Prosperos shares of common stock.



(c)

Dividends



Prospero has declared no dividends on its shares of common stock and is not subject to any restrictions that limit its ability to pay dividends on its shares of common stock.  Dividends are declared at the sole discretion of Prosperos Board of Directors.



(d)

Penny Stock Rules



Trading in Prosperos shares of common stock is subject to the penny stock rules.  The SEC has adopted regulations that generally define a penny stock to be any equity security that has a market price of less than $5.00 per share, subject to certain exceptions.  These rules require that any broker-dealer who recommends Prosperos shares of common stock to persons other than prior customers and accredited investors, must, prior to the sale, make a special written suitability determination for the purchaser and receive the purchasers written agreement to execute the transaction.  Unless an exception is available, the regulations require the delivery, prior to any transaction involving a penny stock, of a



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disclosure schedule explaining the penny stock market and the risks associated with trading in the penny stock market.  In addition, broker-dealers must disclose commissions payable to both the broker-dealer and the registered representative and current quotations for the securities they offer.  The additional burdens imposed upon broker-dealers by such requirements may discourage broker-dealers from effecting transactions in Prosperos shares of common stock, which could severely limit their market price and liquidity of Prosperos shares of common stock.



The penny stock rules also imposes additional sales practice requirements on broker/dealers who sell penny stock.  These rules require a one page summary of certain essential items.  The items include the risk of investing in penny stocks in both public offerings and secondary marketing; terms important in understanding of the function of the penny stock market, such as bid and offer quotes, a dealers spread and broker/dealer compensation; the broker/dealer compensation, the broker/dealers duties to its customers, including the disclosures required by any other penny stock disclosure rules; the customers rights and remedies in causes of fraud in penny stock transactions; and, the NASDs toll free telephone number and the central number of the North American Administrators Association, for information on the disciplinary history of broker/dealers and their associated persons.



Item 2.

Legal Proceedings



Prospero is not a party to any pending legal proceedings and, to the best of Prosperos knowledge, none of Prosperos assets are the subject of any pending legal proceedings.



Item 3.

Changes in and Disagreements with Accountants



Effective August 14, 2006, Prosperos board of directors approved a change in Prosperos independent auditors.  None of the reports of Russell Bedford Stefanou Mirchandani, LLP, Certified Public Accountants on the financial statements of Prospero for the past two years contained any adverse opinion or disclaimer of opinion, or was qualified or modified as to uncertainty, audit scope or accounting principles.  Although audited statements prepared by Russell Bedford Stefanou Mirchandani, LLP, Certified Public Accountants contained a going concern qualification, such financial statements did not contain any adjustments for uncertainties stated therein, nor have there been at any time, disagreements between Prospero and Russell Bedford Stefanou Mirchandani, LLP, Certified Public Accountants on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure.



Prospero retained the accounting firm of Lawrence Scharfman & Co. of Boynton Beach, Florida, USA to serve as its independent accountants to audit its financial statements beginning with the year ended March 31, 2006.  This engagement became effective August 14, 2006.  Prior to its engagement as Prosperos independent auditors, Lawrence Scharfman & Co. had not been consulted by Prospero either with respect to the application of accounting principles to a specific transaction or the type of audit opinion that might be rendered on Prosperos financial statements or on any other matter that was the subject of any prior disagreement between Prospero and its previous certifying accountants.



Item 4.

Recent Sale of Unregistered Securities.



There have been no sales of unregistered securities within the last three years that would be required to be disclosed pursuant to Item 701 of Regulation S-B, except for the following:





November 29, 2005 - $1.30 Offering



On November 29, 2005, the board of directors authorized the issuance of up to 769,230 restricted shares of Common Stock at an offering price of $1.30 per share.  The value of the restricted shares was arbitrarily set by Prospero and had no relationship to its assets, book value, revenues or other established criteria of value.  All the restricted shares issued in this offering will be issued for investment purposes in a private transaction.



Prospero has received $227,116 in subscription funds from 23 non-US subscribers and has paid commissions and finders fees for these subscriptions.  Prospero has not yet issued any restricted shares from this offering as management is waiting for all completed and signed subscription documents to be delivered before closing the private placement and issuing any restricted shares.



For the non-US subscribers outside the United States, Prospero relied on Rule 903 of Regulation S promulgated pursuant to that Act by the Securities and Exchange Commission.  Management will satisfy itself that the requirements of the exemption from the registration and prospectus delivery requirements of the Securities Act of 1933 have been fully complied with before issuing any restricted shares.  The offering



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was not a public offering and was not accompanied by any general advertisement or any general solicitation.  Prospero received from each accepted subscriber a completed and signed subscription agreement containing certain representations and warranties, including, among others, that (a) the subscriber was not a U.S. person, (b) the subscriber subscribed for the shares for their own investment account and not on behalf of a U.S. person, and (c) there was no prearrangement for the sale of the shares with any buyer.  No offer has been made nor will be accepted in the United States and the share certificates representing the shares will be legended with the applicable trading restrictions.



There are no outstanding options or warrants to purchase, or securities convertible into, shares of Prosperos common stock at this time.



Item 5.

Indemnification of Directors and Officers



Prosperos officers and directors are indemnified as provided by the Nevada Revised Statutes and its bylaws.  Under the governing Nevada statutes, director immunity from liability to a company or its shareholders for monetary liabilities applies automatically unless a companys articles of incorporation specifically limit it.  Prosperos articles of incorporation do not contain any limiting language regarding director immunity from liability, except for the following:



1.  a willful failure to deal fairly with Prospero or its shareholders in connection with a matter in which the director has a material conflict of interest;

2.  a violation of criminal law (unless the director had reasonable cause to believe that his or her conduct was lawful or no reasonable cause to believe that his or her conduct was unlawful);

3.  a transaction from which the director derived an improper personal profit; and

4.  willful misconduct.



Prosperos bylaws provide that Prospero will indemnify its directors and officers to the fullest extent not prohibited by Nevada law; provided, however, that Prospero may modify the extent of such indemnification by individual contracts with its directors and officers; and, provided, further, that Prospero will not be required to indemnify any director or officer in connection with any proceeding (or part thereof) initiated by such person unless:



1.  such indemnification is expressly required to be made by law;

2.  the proceeding was authorized by Prosperos Board of Directors;

3.  such indemnification is provided by Prospero, in its sole discretion, pursuant to the powers vested us under Nevada law; or;

4.  such indemnification is required to be made pursuant to the bylaws.



Prosperos bylaws provide that Prospero will advance to any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (a Claim), by reason of the fact that he is or was a director or officer, of the company, or is or was serving at the request of the company as a director or executive officer of another company, partnership, joint venture, trust or other enterprise, prior to the final disposition of the proceeding, promptly following request therefore, all expenses incurred by any director or officer in connection with such proceeding upon receipt of an undertaking by or on behalf of such person to repay said amounts if it should be determined ultimately that such person is not entitled to be indemnified under Prosperos bylaws or otherwise.



Prosperos bylaws provide that no advance will be made by Prospero to an officer of Prospero, except by reason of the fact that such officer is or was a director of Prospero, in which event this paragraph will not apply, in any Claim, if a determination is reasonably and promptly made: (a) by the board of directors by a majority vote of a quorum consisting of directors who were not parties to the proceeding, or (b) if such quorum is not obtainable, or, even if obtainable, a quorum of disinterested directors so directs, by independent legal counsel in a written opinion, that the facts known to the decision-making party at the time such determination is made demonstrate clearly and convincingly that such person acted in bad faith or in a manner that such person did not believe to be in or not opposed to the best interests of the company.



Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers or persons controlling Prospero pursuant to the foregoing provisions, or otherwise, Prospero has been advised that in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable.



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Part F/S



Reference is made to the filings by Prospero on Forms 10-KSB and 10-QSB for Prosperos Financial Statements.





Item 3.02.

Unregistered Sales of Equity Securities.



On March 31, 2006, as consideration for the acquisition of assets as disclosed in Item 1.01 above, Prospero agreed to issue RCA Resources Corporation 80 million restricted shares of Common Stock.  Prospero relied upon the private placement exemption of Section 4(2) of the Securities Act of 1933 as the issuance did not involve a public offering.  RCA conducted its own due diligence on Prospero to its satisfaction and was furnished substantial information regarding Prospero.  During its due diligence, RCA had the opportunity to ask questions and receive answers from the Prospero regarding Prosperos business and its financial condition.  The offer and issuance of the shares of Common Stock was not made pursuant to a general solicitation or general advertisement by Prospero and no broker/dealers were involved in this transaction.  See Exhibit 10.7 - Asset Purchase Agreement for more details.



Item 5.01.

Changes in Control of Registrant.



On March 31, 2006, there was a change in control in the voting shares of Prospero.  The basis of the change in control was a change in the controlling shareholder.



RCA Resources Corporation acquired a controlling interest by transferring its assets to Prospero pursuant to the terms and conditions of the Asset Purchase Agreement.  As consideration for the assets, RCA received 80 million restricted shares of Common Stock, which represents 89.6% of the issued and outstanding shares of Common Stock in the capital of Prospero.  RCA is a private corporation incorporated under the laws of Nevada, which is beneficially owned by 1,045 shareholders with no shareholder beneficially owning 5% or more of the issued and outstanding shares in the capital of RCA, with the exception of Chris Roth who beneficially owns 21.3% and Didier Llinas who beneficially owns 7.8% of the issued and outstanding shares in the capital of RCA.



Prior to the acquisition of the assets and issuance of shares as consideration for the assets, as disclosed in Item 1.01 above, no shareholder beneficially owned 5% or more of the issued and outstanding shares of Common Stock.



Item 5.06.

Change in Shell Company Status.



Prospero is a shell company (due to the 8 K/A Filing.

As a result of the transaction described under Item 1.01 above, Prospero is no longer a shell company.   See Item 1.01 for information relating to the Asset Purchase Agreement and Item 2.01 for a description of Prosperos business following completion of the transaction described under Item 1.01.



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SIGNATURES





In accordance with the requirements of the Securities Exchange Act of 1934, Prospero Minerals Corp. has caused this report to be signed on its behalf by the undersigned duly authorized person.





PROSPERO MINERALS CORP.



By:        /s/ Didier Llinas

Name:   Didier Llinas

Title :   Director

Dated:  August 19, 2006





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Exhibit 31





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PROSPERO MINERALS CORP .

CERTIFICATIONS PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002





CERTIFICATION





I, Didier Llinas, certify that:





1.   I have reviewed this quarterly report on Form 10-QSB of Prospero Minerals Corp.;



2.   Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;



3.   Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;



4.   The registrants other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:



a)   designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;



b)   evaluated the effectiveness of the registrants disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the Evaluation Date); and



c)   presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;



5.   The registrants other certifying officer and I have disclosed, based on our most recent evaluation, to the registrants auditors and the audit committee of registrants board of directors (or persons performing the equivalent function):



a)   all significant deficiencies in the design or operation of internal controls which could adversely affect the registrants ability to record, process, summarize and report financial data and have identified for the registrants auditors any material weaknesses in internal controls; and



b)   any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal controls; and



6.   The registrants other certifying officer and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.



Date: August 19, 2006



/s/ Didier Llinas

Didier Llinas
Director





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Exhibit 32





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CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002











In connection with the Quarterly Report of Prospero Minerals Corp. (Prospero) on Form 10-QSB for the period ending June 30, 2005 as filed with the Securities and Exchange Commission on the date hereof (the Report), I, Didier Llinas, a member of the Board of Directors, certify, pursuant to s.906 of the Sarbanes-Oxley Act of 2002, that:





(1)   The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and



(2)   The information contained in the Report fairly represents, the financial condition and result of operations of Prospero.







/s/ Didier Llinas

Didier Llinas
Director



August 19, 2006





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