SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



FORM 10-Q





(Mark One)



[ X ] QUARTERLY REPORT PURSUANT TO SECTION
13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



For the quarterly period ended June 30, 2011



OR



[    ] TRANSITION REPORT
UNDER SECTION 13 OF 15(d) OF THE EXCHANGE ACT OF 1934



From the transition period from ___________
to ____________



Commission File Number 000-51750



PHOENIX MEDICAL SOFTWARE, INC.

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



|Nevada                                                         | 20-4846807                       
|-------------------------------------------------------------- | ---------------------------------
|(State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.)



604 Creekview, Ovilla, Texas 75154

(Address of principal executive offices)



(800) 843-8179

(Issuer's telephone number)



N/A

(Former name, former address and former fiscal
year, if changed since last report)



Indicate by check mark whether the registrant
(1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past
90 days:.  Yes [ X ]   No [     ].



Indicate by a check mark whether the registrant is a large accelerated
filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated
filer,” ”accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.



| | Large Accelerated Filer [   ] |  | Accelerated Filer [  ]       
| | ----------------------------- |  | -----------------------------
| |                               |  |                              
| | Non-Accelerated Filer   [   ] |  | Smaller Reporting Company [X]



Indicate by a check mark whether the company is a shell company
(as defined by Rule 12b-2 of the Exchange Act:  Yes [   ]   No [X].



As of August 15, 2011 there were 9,513,667 shares of Common Stock
of the issuer outstanding.



1









TABLE OF CONTENTS



|       | PART I FINANCIAL STATEMENTS                               |   
|------ | --------------------------------------------------------- | --
|       |                                                           |   
|Item 1 | Financial Statements                                      | 3 
|       |                                                           |   
|Item 2 | Management's Discussion and Analysis or Plan of Operation | 7 
|       |                                                           |   
|       | PART II OTHER INFORMATION                                 |   
|       |                                                           |   
|Item 1 | Legal Proceedings                                         | 12
|Item 2 | Changes in Securities                                     | 12
|Item 3 | Default upon Senior Securities                            | 12
|Item 4 | Submission of Matters to a Vote of Security Holders       | 12
|Item 5 | Other Information                                         | 12















2









|PHOENIX MEDICAL SOFTWARE, INC. 
|-------------------------------
|(FORMERLTRIPLE
AMEDICAL, INC.) 
|CONSOLIDATED
    BALANCE SHEETS
|(Unaudited)                    
|                               





|                                                                                     |  |               |            |   | (Audited)         |  
|------------------------------------------------------------------------------------ |  | ------------- | ---------- | - | ----------------- | -
|                                                                                     |  | June 30, 2011 |            |   | December 31, 2010 |  
|ASSETS                                                                               |  |               |            |   |                   |  
|CURRENT ASSETS:                                                                      |  |               |            |   |                   |  
|Cash and cash equivalents                                                            |  | $             | 31,164     |   |                   | $
|Accounts receivable, net of allowance for doubtful accounts of $316,753 and $216,825 |  |               | 272,858    |   |                   |  
|                                                                                     |  |               |            |   |                   |  
|Total Current Assets                                                                 |  |               | 304,022    |   |                   |  
|                                                                                     |  |               |            |   |                   |  
|                                                                                     |  |               |            |   |                   |  
|Developed software, net                                                              |  |               | 94,750     |   |                   |  
|                                                                                     |  |               |            |   |                   |  
|TOTAL ASSETS                                                                         |  | $             | 398,772    |   |                   | $
|                                                                                     |  |               |            |   |                   |  
|                                                                                     |  |               |            |   |                   |  
|LIABILITIES AND STOCKHOLDERS' EQUITY                                                 |  |               |            |   |                   |  
|CURRENT LIABILITIES:                                                                 |  |               |            |   |                   |  
|Accounts payable and accrued expenses                                                |  | $             | 165,761    |   |                   | $
|Line of credit                                                                       |  |               | 27,282     |   |                   |  
|Advanced from shareholder                                                            |  |               | 30,200     |   |                   |  
|Total Current Liabilities                                                            |  |               | 223,243    |   |                   |  
|                                                                                     |  |               |            |   |                   |  
|STOCKHOLDERS' EQUITY                                                                 |  |               |            |   |                   |  
|Preferred stock, $0.01 par value, 20,000,000 authorized,                             |  |               |            |   |                   |  
|none issued and outstanding                                                          |  |               | -          |   |                   |  
|Common stock, $0.01 par value, 50,000,000 authorized,                                |  |               |            |   |                   |  
|9,513,667 and 9,513,667 issued and outstanding, respectively                         |  |               | 9,514      |   |                   |  
|Additional paid-in-capital                                                           |  |               | 2,016,234  |   |                   |  
|Subscription deposits                                                                |  |               | 2,625      |   |                   |  
|Accumulated deficit                                                                  |  |               | (1,852,844 | ) |                   |  
|Total stockholders’ equity                                                           |  |               | 175,529    |   |                   |  
|                                                                                     |  |               |            |   |                   |  
|TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                           |  | $             | 398,772    |   |                   | $
|                                                                                     |  |               |            |   |                   |  







|See accompanying summary of accounting policies and notes to unaudited consolidated financial statements.
|---------------------------------------------------------------------------------------------------------







3













|PHOENIX MEDICAL SOFTWARE, INC.                          
|--------------------------------------------------------
|(FORMERLTRIPLE
AMEDICAL, INC.)                          
|CONSOLIDATED
    STATEMENTS OF OPERATIONS               
|For
theThree and Six months Ended June 30, 2011 and 2010
|                                                        





|                                                      |  | Three Months Ended |           | Six months Ended
|----------------------------------------------------- |  | ------------------ | --------- | ----------------
|                                                      |  | June 30            |           | June 30,        
|                                                      |  | 2011               |           | 2010            
|REVENUE                                               |  |                    | 759,832   |                 
|                                                      |  |                    |           |                 
|OPERATING EXPENSES:                                   |  |                    |           |                 
|Depreciation and amortization                         |  |                    | 19,128    |                 
|Selling, general and administrative                   |  |                    | 558,757   |                 
|Total operating expenses                              |  |                    | 577,885   |                 
|                                                      |  |                    |           |                 
|Income (loss) from operations                         |  |                    | 181,947   |                 
|OTHER INCOME                                          |  |                    |           |                 
|Interest income                                       |  |                    | 10        |                 
|Net income (loss)                                     |  |                    | 181,957   |                 
|                                                      |  |                    |           |                 
|Basic and diluted weighted average shares outstanding |  |                    | 9,513,667 |                 
|                                                      |  |                    |           |                 
|Basic and diluted net loss per share                  |  |                    | 0.02      |                 
|                                                      |  |                    |           |                 
|                                                      |  |                    |           |                 





|See accompanying summary of accounting policies and notes to unaudited consolidated financial statements.
|---------------------------------------------------------------------------------------------------------









4













|PHOENIX MEDICAL SOFTWARE, INC.                 
|-----------------------------------------------
|(FORMERLTRIPLE
AMEDICAL, INC.)                 
|CONSOLIDATED
    STATEMENTS OF CASH FLOWS      
|For
the Six months Ended June 30, 2011 and 2010
|(Unaudited)                                    









|                                                                                                         |  | Six months Ended
|-------------------------------------------------------------------------------------------------------- |  | ----------------
|                                                                                                         |  | June 30,        
|                                                                                                         |  | 2011            
|CASH FLOWS FROM OPERATING ACTIVITIES:                                                                    |  |                 
|Net loss                                                                                                 |  | $               
|Adjustments to reconcile net loss to net                                                                 |  |                 
|cash used in operating activities:                                                                       |  |                 
|Depreciation and amortization                                                                            |  |                 
|Stock issued for services                                                                                |  |                 
|Bad debt expense                                                                                         |  |                 
|Change in operating assets and liabilities:                                                              |  |                 
|Accounts receivable                                                                                      |  |                 
|Accounts payable and accrued expenses                                                                    |  |                 
|NET CASH USED IN OPERATING ACTIVITIES                                                                    |  |                 
|                                                                                                         |  |                 
|CASH FLOWS FROM FINANCING ACTIVITIES:                                                                    |  |                 
|Proceeds from sale of stock, including stock subscription deposits                                       |  |                 
|Payments on line of credit                                                                               |  |                 
|Advances from shareholder                                                                                |  |                 
|Payments to shareholder                                                                                  |  |                 
|                                                                                                         |  |                 
|NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES                                                      |  |                 
|                                                                                                         |  |                 
|NET DECREASE IN CASH                                                                                     |  |                 
|CASH, BEGINNING OF PERIOD                                                                                |  |                 
|CASH, END OF PERIOD                                                                                      |  | $               
|                                                                                                         |  |                 
|NON-CASH TRANSACTIONS                                                                                    |  |                 
|Common stock issued for conversion of debt                                                               |  | $               
|SUPPLEMENTAL DISCLOSURES                                                                                 |  |                 
|Interest paid                                                                                            |  | $               
|Income taxes paid                                                                                        |  |                 
|                                                                                                         |  |                 
|See accompanying summary of accounting policies and notes to unaudited consolidated financial statements |  |                 
|                                                                                                         |  |                 











5







PHOENIX MEDICAL SOFTWARE, INC.

(FORMERLY TRIPLE A MEDICAL, INC.)

Notes to the Consolidated Financial Statements

(Unaudited)





NOTE 1--BASIS OF PRESENTATION



The accompanying unaudited interim consolidated
financial statements of Phoenix Medical Software, Inc. (formerly Triple A Medical, Inc.) (“Phoenix Medical”) have been
prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information
and with the rules and regulations of the Securities and Exchange Commission.  They do not include all information and notes
required by U.S. generally accepted accounting principles for complete financial statements.  These interim consolidated financial
statements should be read in conjunction with the audited consolidated financial statements and the accompanying notes contained
in Phoenix Medical’s Annual Report on Form 10-K filed on March 31, 2011 for the year ended December 31, 2010.



In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered necessary for a fair presentation of the financial position, results of operations
and cash flows for the interim periods presented have been included.  The results of operations for interim periods are not
necessarily indicative of the results that may be expected for any other interim period or for the full year.



The preparation of consolidated financial statements
in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from
those estimates.



Certain 2010 amounts have been reclassed to
agree with the 2011 classifications.





NOTE 2--RECENT ACCOUNTING PRONOUNCEMENTS



There are no recent accounting pronouncements
that are expected to have a material impact on the Company’s present or future consolidated financial statements.





NOTE 3--GOING CONCERN



Phoenix Medical has recurring losses and an
accumulated deficit.  Additionally, Phoenix Medical has incurred recurring deficits in cash flows from operating activities.
These factors raise substantial doubt about the Company’s ability to continue as a going concern. However, Phoenix Medical's
financial statements have been presented on the basis that it is a going concern, which contemplates the realization of assets
and the satisfaction of liabilities in the normal course of business.



Phoenix Medical's ability to continue as a
going concern is dependent upon its ability to successfully market and implement its developed software product and to achieve
profitable operations.  The accompanying financial statements do not include any adjustments that might result from the
outcome of these uncertainties.





NOTE 4--RELATED PARTY TRANSACTIONS



In order to fund the development of the software,
Phoenix Medical entered into an ‘Investment and Net Revenue Agreement’ with Phoenix Ortho, LLC (ORTHO), an entity controlled
by a relative of the President of Phoenix Medical. In exchange for this contributed capital, Phoenix Medical provided ORTHO with
an income participation interest in its operations.  The terms of this agreement require Phoenix Medical to pay ORTHO
33.1% of the net revenues generated by the business in the immediately preceding month.



As of December 31, 2010 and June 30, 2011, Phoenix Medical had unpaid
advances owed to Paul McCune, the sole Director of the Company. The unpaid advance totaling to $30,200 as of June 30, 2011 and
$5,200 as of December 31, 2010 is unsecured, bears no interest and is due on demand.



The Company rents office space from the President at $5,000 per
month. The expense for the three months ended June 30, 2011 and 2010 was $15,000. The expense for the six months ended June 30,
2011 and 2010 was $30,000.







6













ITEM 2.  MANAGEMENT’S DISCUSSION AND ANALYSIS



This report contains forward looking
statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange
Act of 1934, as amended.  The Company’s actual results could differ materially from those set forth on the forward
looking statements as a result of the risks set forth in the Company’s filings with the Securities and Exchange Commission,
general economic conditions, and changes in the assumptions used in making such forward looking statements.



General



The Company was founded to create electronic
healthcare software applications.  The initial development is an Electronic Health Record (EHR), specifically designed
to meet the needs of orthopedic physicians. For the past four years, our President, Morgan McCune, has worked directly with dozens
of orthopedic physicians in more than 40 states.  He has reviewed orthopedic clinical research and extensively surveyed
reference materials.  Based upon the research, Mr. McCune created a database with a graphical interface to assist orthopedic
physicians with the documentation of the patient encounter.



The six months ended June 30, 2011 saw the
Company to continue to drive revenue through both system contracts and legacy maintenance revenue.





RESULTS FOR THE FISCAL QUARTER ENDED JUNE
30, 2011



During the six months ended June 30, 2011,
we continued marketing our software and following up on sales leads and continue to experience double-digit growth in both the
recent fiscal quarter (27%) and over the first six months (20%) versus 2010. The sales cycle can be anywhere from three months
to one year.  In addition to a couple independent sales persons and alliances with marketing partners, we have a full
time salesman on commission only.  Our sales leads continue to be generated and followed up on as we receive them from
our own efforts by attendance at trade shows and from referrals from our industry cross marketing agreements. We have hit a stage
in our business where we have our software developed and running smoothly and our infrastructure built so that we can install and
maintain a multiple number of installations. During of the year ending December 31, 2010 we ran into a cash squeeze whereby the
cost to maintain our infrastructure, which we estimate we need sales of approximately $500,000 per quarter, was considerably more
than our sales. The second quarter of 2011 has been our best quarter ever with revenue of approximately $759,800 generating
net income of approximately $181,900.



REVENUE. Revenue in the three months ended
June 30, 2011 was $759,832 compared to $596,388 in the three months ended June 30, 2010. Revenue in the six months ended June 30,
2011 was $1,142,264 compared to $954,187 in the six months ended June 30, 2010.



The fluctuation in sales is due to the timing
of closing sales contracts.  Please reference the table below to view the Installation Contracts quarter-to-date (QTD)
and year-to-date (YTD) for 2011 versus 2010.



|                       | 2011     | 2010      
|---------------------- | -------- | ----------
|                       | QTD      | YTD       
|Installation Contracts | $545,096 | $727,041  
|Maintenance/Other      | 214,736  | 415,223   
|TOTAL                  | $759,832 | $1,142,264



Revenue for the three month period ended June 30, 2011 was
impacted by nine new implementation contracts and a carryover from 2010 with the difference related to maintenance/service on existing
installations.  During the three and six months ended June 30, 2011 there were a total of 32 customers making up the
service/maintenance revenue of $214,736 and $415,223, respectively.  In contrast, during the three and six month periods
ended June 30, 2010 there were a total of 17 customers making up the service revenue of $131,054 and $181,820, respectively.  Monthly
maintenance revenue is important to establishing consistent cash flow and profitability once the Company reaches the right level
of critical mass.



Installation contract revenue for the three
months ended June 30, 2011 was $545,096 compared to $465,334 for the three months ended June 30, 2010.  Installation
contract revenue for the six months ended June 30, 2011 was $727,041 compared to $772,367 for the six months ended June 30, 2010.
In 2011 there have been 3 new/carryover installation contracts with average billing of $60,600.  In 2011 we have 11 new
contracts with average billings so far of $60,000 (not all complete thus average is low compared to final billings). In 2010 there
were nine new installation contracts with average billing of $85,800.







7









EXPENSES. Total operating expenses, not including
depreciation expense, were $558,757 for the three months June 30, 2011 compared to $570,527 for the three months ended June 30,
2010.  Total operating expenses, not including depreciation expense, were $1,197,925 for the six months June 30, 2011
compared to $1,020,534 for the six months ended June 30, 2010.



The decrease in expenses of about $12,000 in
the three month period ended June 30, 2011 is due to the following factors. Decreased commissions of $112,000 (as the company has
been selling more in-house versus third party agents) and reduced travel and admin of $50,000 was mostly off-set by increased employee
leasing and contract services of $121,000 (staffed-up in fiscal fourth quarter of 2010 and maintained staff level in 2011), and
marketing and trade shows of $29,000.



The increase in expenses of about $177,000
in the six month period ended June 30, 2011 is due to the following factors. Increased employee leasing and contract services of
$183,000, increased bad debt provisions of $72,000, increased travel and admin expenses of $96,000, and increased marketing / trade
show expense of $30,000, partially offset by decreased commissions of $205,000.



Depreciation and amortization expense was $19,128
and $21,181 for the three months ended June 30, 2011 and 2010, respectively. Depreciation and amortization expense was $38,257
and $42,364 for the six months ended June 30, 2011 and 2010, respectively.



OTHER INCOME. We had interest income of $10
and $15 for the three months ended June 30, 2011 and 2010, respectively. We had interest income of $27 and $60 for the six months
ended June 30, 2011 and 2010, respectively.



NET LOSS. Net income for the three months ended
June 30, 2011 was $181,957 compared to $4,695 for the three months ended June 30, 2010.  Net loss for the six months
ended June 30, 2011 was $93,891 compared to net loss of $108,651 for the six months ended June 30, 2010. The change in income (loss)
for both the three and six month periods is directly related to the net impact of revenue and expenses as discussed above



LIQUIDITY AND CAPITAL RESOURCES. Our cash balance
at June 30, 2011 was $31,164 compared to $222,348 at December 31, 2010.  As discussed in Note 2 the Company has recurring
losses and an accumulated deficit.  Additionally, Phoenix Medical has incurred recurring deficits in cash flows from
operating activities. These factors raise substantial doubt about the Company’s ability to continue as a going concern.  The
Company plans for liquidity needs on a short term and long term basis as follows:



Short Term Liquidity:

The company currently relies on short-term
financing of working capital from individual investors and also shareholder advances, when necessary, to fund operations.



Long Term Liquidity:

The long term liquidity needs of
the Company are projected to be met primarily through the cash flow provided by operations.  Although our operating cash
flow from operations is negative $208,775 for the six months ended June 30, 2011, we signed eight new contracts in the fiscal second
quarter and expect the receivables to generate better cash flows in our fiscal third quarter.  As we sign new contracts and
perpetuate maintenance revenue we expect cash flow from operations to fund itself.



Capital Resources



Over the past few years we have noticed that
our business does not have a seasonal trend.  Currently our revenue stream is geared toward installation contracts and
as we grow we expect to see a more balanced revenue line between installation and maintenance sales.



We do not expect any significant change to
our equity or debt structure and do not anticipate entering into any off-balance sheet arrangements.



Material Changes in Financial Condition



WORKING CAPITAL: Working capital declined by
$55,634 to $80,779 since December 31, 2010.  This reduction is due to four main items.

Firstly: Cash decreased $191,000
due to maintaining expense structure (unfavorable)

Secondly: Net accounts receivable
increased $165,000 (favorable)

Thirdly: AP/Accrued Expenses
increased $12,000 (unfavorable)

Fourthly: Shareholder advances
increased $25,000 (unfavorable)



Employees



As of June 30, 2011, the Company had seven
employees which it pays through an employee leasing agreement.  Four of the employees are support and/or technical personnel.





8









ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK



Not applicable.





ITEM 4: CONTROLS AND PROCEDURES





We carried out an evaluation of the
effectiveness of the design and operation of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e)
and 15d-15(e)) as of June 30, 2011.  This evaluation was accomplished under the supervision and with the participation
of our chief executive officer / principal executive officer, and chief financial officer / principal financial officer who concluded
that our disclosure controls and procedures are not effective to ensure that all material information required to be filed in the
quarterly Form 10-Q has been made known to them.



For purposes of this section, the
term disclosure controls and procedures means controls and other procedures of an issuer that are designed to ensure that information
required to be disclosed by the issuer in the reports that it files or submits under the Act (15 U.S.C. 78a et seg.) is recorded,
processed, summarized and reported, within the time periods specified in the Commission’s rules and forms.  Disclosure,
controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be
disclosed by in our reports filed under the Securities Exchange Act of 1934, as amended (the "Act") is accumulated and
communicated to the issuer's management, including its principal executive and principal financial officers, or persons performing
similar functions, as appropriate to allow timely decisions regarding required disclosure.



Based upon an evaluation conducted for the period ended June
30, 2010, our Chief Executive and Chief Financial Officer as of June 30, 2010 and as of the date of this Report, has concluded
that as of the end of the periods covered by this report, we have identified the following material weakness of our internal controls:



●  Reliance upon independent financial reporting
consultants for review of critical accounting areas and disclosures and material non-standard transaction.

●  Lack of sufficient accounting staff which
results in a lack of segregation of duties necessary for a good system of internal control.



In order to remedy our existing internal
control deficiencies, as our finances allow, we will hire additional accounting staff.



Changes in Internal Controls over
Financial Reporting



We have not yet made any changes
in our internal controls over financial reporting that occurred during the period covered by this report on Form 10-Q/A that
has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.





9











PART II



Items No. 1, 2, 3, 4, 5 - Not Applicable.





Item No. 6 - Exhibits and Reports on Form 8-K



(a) No reports on Form 8-K were filed during the six months ended
June 30, 2011.



(b)   Exhibits





|Exhibit Number |                                                                                                                                                                                    | Name of Exhibit
|-------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------
|               |                                                                                                                                                                                   
|31.1           | Certification of Chief Executive Officer, pursuant to Rule 13a-14(a) of the Exchange Act, as enacted by Section 302 of the Sarbanes-Oxley Act of 2002.                            
|               |                                                                                                                                                                                   
|31.2           | Certification of Chief Financial Officer, pursuant to Rule 13a-14(a) of the Exchange Act, as enacted by Section 302 of the Sarbanes-Oxley Act of 2002.                            
|               |                                                                                                                                                                                   
|32.1           | Certification of Chief Executive Officer and Chief Financial Officer, pursuant to 18 United States Code Section 1350, as enacted by Section 906 of the Sarbanes-Oxley Act of 2002.
|               |                                                                                                                                                                                   







SIGNATURES



In accordance with 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.



PHOENIX MEDICAL SOFTWARE, INC.



By /s/ P. Morgan McCune



P. Morgan McCune, President, CFO



Date: August 15, 2011









10