UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549



FORM 10-KSB



xANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934



For the fiscal year ended: December 31, 2006



oTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934



Commission file number 000-29353



ACCESSORY SPECIALISTS INCORPORATED

(Exact name of registrant as specified in its charter)



Nevada
        88-0448316(State or other jurisdiction of
        (I.R.S. Employerincorporation or organization)
        Identification No.)770 E. Warm Springs Rd., Suite 250Las Vegas, NV
        89119(Address of principal executive offices)
        (zip code)




Issuer's Telephone Number:(702) 866-5839



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

None



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

Common Stock, $0.001 par value

(Title if Class)



Check whether the issuer (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.  YesX   No



Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B contained in this form, and no disclosure will be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or any amendment to this Form 10-KSB.  [     ]



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



The issuers revenues for its most recent fiscal year ended December 31, 2006.  $0.00



The number of shares of Common Stock, $0.001 par value, outstanding on December 31, 2006, was 9,716,370 shares, held by 1 stockholder.



Transitional Small Business Disclosure Format (check one):  Yes       NoX



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PART I



ITEM 1.
        DESCRIPTION OF BUSINESS




Accessory Specialists Incorporated was incorporated in the State of Nevada on January 18, 2000, to engage in any lawful corporate undertaking, including, but not limited to, selected mergers and acquisitions. We have been in the development stage since inception.  Accessory Specialists Incorporated has not engaged in any commercial operations. Accessory Specialists Incorporated does not have active business operations, and at this time we are considered a "Blank Check" company.



We registered our common stock on a Form 10-SB registration statement filed pursuant to the Securities Exchange Act of 1934 (the "Exchange Act") and Rule 12(g) thereof.  We file with the Securities and Exchange Commission periodic and episodic reports under Rule 13(a) of the Exchange Act, including quarterly reports on Form 10-QSB and annual reports on Form 10-KSB.



We will attempt to locate and negotiate with a business entity for the merger of a target business into the Company.  In certain instances, a target business may wish to become a subsidiary of the Company or may wish to contribute assets to the Company rather than merge.  No assurances can be given that we will be successful in locating or negotiating with any target business.



Management believes that there are perceived benefits to being a reporting company with a class of publicly-registered securities.  These are commonly thought to include (1) the ability to use registered securities to make acquisition of assets or businesses; (2) increased visibility in the financial community; (3) the facilitation of borrowing from financial institutions; (4) improved trading efficiency; (5) stockholder liquidity; (6) greater ease in subsequently raising capital; (7) compensation of key employees through stock options; (8) enhanced corporate image; and (9) a presence in the United States capital market.



A business entity, if any, which may be interested in a business combination with us may include (1) a company for which a primary purpose of becoming public is the use of its securities for the acquisition of assets or businesses; (2) a company which is unable to find an underwriter of its securities or is unable to find an underwriter of securities on terms acceptable to it; (3) a company which wishes to become public with less dilution of its common stock than would occur normally upon an underwriting; (4) a company which believes that it will be able to obtain investment capital on more favorable terms after it has become public; (5) a foreign company which may wish to gain an initial entry into the United States securities market; (6) a special situation company, such as a company seeking a public market to satisfy redemption requirements under a qualified Employee Stock Option Plan;
or (7) a company seeking one or more of the other perceived benefits of becoming a public company.



Management is seeking a qualified company as a candidate for a business combination.  We are authorized to enter into a definitive agreement with a wide variety of businesses without limitation as to their industry or revenues.  It is not possible at this time to predict with which company, if any, we will enter into a definitive agreement or what will be the industry, operating history, revenues, future prospects or other characteristics of that company.



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We may seek a business opportunity with entities which have recently commenced operations, or which wish to utilize the public marketplace in order to raise additional capital in order to expand into new products or markets, to develop a new product or service, or for other corporate purposes.  We may acquire assets and establish wholly-owned subsidiaries in various businesses or acquire existing businesses as subsidiaries.



Our management, which in all likelihood will not be experienced in matters relating to the business of a target business, will rely upon its own efforts in accomplishing our business purposes.  Outside consultants or advisors may be utilized by us to assist in the search for qualified target companies.  If we do retain such an outside consultant or advisor, any cash fee earned by such person will need to be assumed by the target business, as we have no cash assets with which to pay such obligation.



The analysis of new business opportunities will be undertaken by, or under the supervision of our officer and director, who is not a professional business analyst.  In analyzing prospective business opportunities, management may consider such matters as:




        the available technical, financial and managerial resources;



        working capital and other financial requirements;



        history of operations, if any;



        prospects for the future;



        nature of present and expected competition;



        the quality and experience of management services which may be available and the depth of that management;



        the potential for further research, development, or exploration;



        specific risk factors not now foreseeable but which then may be anticipated to impact our proposed activities;



        the potential for growth or expansion;



        the potential for profit;



        the perceived public recognition or acceptance of products, services, or trades; name identification; and



        other relevant factors.




Management does not have the capacity to conduct as extensive an investigation of a target business as might be undertaken by a venture capital fund or similar institution.  As a result, management may elect to merge with a target business which has one or more undiscovered shortcomings and may, if given the choice to select among target businesses, fail to enter into an agreement with the most investment-worthy target business.



Following a business combination we may benefit from the services of others in regard to accounting, legal services, underwritings and corporate public relations.  If requested by a target business, management may recommend one or more underwriters, financial advisors, accountants, public relations firms or other consultants to provide such services.



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A potential target business may have an agreement with a consultant or advisor, providing that services of the consultant or advisor be continued after any business combination.  Additionally, a target business may be presented to us only on the condition that the services of a consultant or advisor be continued after a merger or acquisition.  Such preexisting agreements of target businesses for the continuation of the services of attorneys, accountants, advisors or consultants could be a factor in the selection of a target business.



In implementing a structure for a particular business acquisition, we may become a party to a merger, consolidation, reorganization, joint venture, or licensing agreement with another corporation or entity.  We may also acquire stock or assets of an existing business.  On the consummation of a transaction, it is likely that our present management and stockholder will no longer be in control.  In addition, it is likely that our officer and director will, as part of the terms of the acquisition transaction, resign and be replaced by one or more new officers and directors.



It is anticipated that any securities issued in any such reorganization would be issued in reliance upon exemption from registration under applicable federal and state securities laws.  In some circumstances however, as a negotiated element of its transaction, we may agree to register all or a part of such securities immediately after the transaction is consummated or at specified times thereafter.  If such registration occurs, of which there can be no assurance, it will be undertaken by the surviving entity after we have entered into an agreement for a business combination or have consummated a business combination and we are no longer considered a blank check company. The issuance of additional securities and their potential sale into any trading market which may develop in our securities may depress the market value of our securities in the future if such a market develops, of which
there is no assurance.



While the terms of a business transaction to which we may be a party cannot be predicted, it is expected that the parties to the business transaction will desire to avoid the creation of a taxable event and thereby structure the acquisition in a tax-free reorganization under Sections 351 or 368 of the Internal Revenue Code of 1986, as amended.



With respect to any merger or acquisition negotiations with a target business, management expects to focus on the percentage of the Company which target business stockholder would acquire in exchange for their shareholdings in the target business.  Depending upon, among other things, the target business's assets and liabilities, our stockholder will in all likelihood hold a substantially lesser percentage ownership interest in the Company following any merger or acquisition.  Any merger or acquisition effected by us can be expected to have a significant dilutive effect on the percentage of shares held by our stockholder at such time.



No assurances can be given that we will be able to enter into a business combination, as to the terms of a business combination, or as to the nature of the target business.



As of the date hereof, management has not made any final decision concerning or entered into any written agreements for a business combination.  When any such agreement is reached or other material fact occurs, we will file notice of such agreement or fact with the Securities and Exchange Commission on Form 8-K.  Persons reading this Form 10-KSB are advised to determine if we have subsequently filed a Form 8-K.



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We anticipate that the selection of a business opportunity in which to participate will be complex and without certainty of success. Management believes (but has not conducted any research to confirm) that there are numerous firms seeking the perceived benefits of a publicly registered corporation.  Such perceived benefits may include facilitating or improving the terms on which additional equity financing may be sought, providing liquidity for incentive stock options or similar benefits to key employees, increasing the opportunity to use securities for acquisitions, and providing liquidity for our stockholder and other factors.  Business opportunities may be available in many different industries and at various stages of development, all of which will make the task of comparative investigation and analysis of such business opportunities extremely difficult and complex.



ITEM 2.
        DESCRIPTION OF PROPERTY




We have no properties and at this time have no agreements to acquire any properties.  We currently use the office of management at no cost to us.  Management has agreed to continue this arrangement until we complete an acquisition or merger.



ITEM 3.
        LEGAL PROCEEDINGS




There is no litigation pending or threatened by or against us.



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




No matter was submitted to a vote of security holders, through the solicitation of proxies or otherwise, during the fourth quarter of the fiscal year covered by this report.



PART II



ITEM 5.
        MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS




There is currently no public market for our securities. We do not intend to trade our securities in the secondary market until completion of a business combination or acquisition.  It is anticipated that following such occurrence we will request that our common stock be quoted on the NASD OTC Bulletin Board or, if we then meet the financial and other requirements thereof, on the Nasdaq SmallCap Market, National Market System or regional or national exchange.



The proposed business activities described herein classify us as a "blank check" company.  The Securities and Exchange Commission and many states have enacted statutes, rules and regulations limiting the sale of securities of blank check companies in their respective jurisdictions. Management does not intend to undertake any efforts to cause a market to develop in our securities until such time as we have successfully implemented our business plan described herein.  Accordingly, our stockholder has agreed that he will not sell or otherwise transfer his shares of our common stock except in connection with or following completion of a merger or acquisition and we are no longer classified as a blank check company.



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There is currently one stockholder of our outstanding common stock.



During the past three years, we have issued securities which were not registered as follows:



DATE
        NAME
        NUMBER OF SHARES
        CONSIDERATIONJune 15, 2004
        Anthony N. DeMint
        1,000,000
        $1,000 (1)September 29, 2004
        Anthony N. DeMint
        250,000
        $250 (1)January 14, 2005
        Anthony N. DeMint
        250,000
        $250 (1)February 16, 2005
        Anthony N. DeMint
        750,000
        $750 (1)


________



(1)Shares issued to Mr. DeMint were conversions of debt to equity for monies advanced by Mr. DeMint. With respect to the stock issued to Mr. DeMint, we relied upon Section 4(2) of the Securities Act of 1933.



ITEM 6.
        PLAN OF OPERATION




We have registered our common stock on a Form 10-SB registration statement filed pursuant to the Securities Exchange Act of 1934, as amended (the Exchange Act) and Rule 12(g) thereof. We file with the Securities and Exchange Commission periodic and episodic reports under Rule 13(a) of the Exchange Act, including quarterly reports on Form 10-QSB and annual reports on Form 10-KSB.



We are currently seeking to engage in a merger with or acquisition of an unidentified foreign or domestic company which desires to become a reporting (public) company whose securities are qualified for trading in the United States secondary market. We meet the definition of a blank check company contained in Section (7)(b)(3) of the Securities Act of 1933, as amended. We have been in the developmental stage since inception and have no operations to date. Other than issuing shares to our sole stockholder, we have not commenced any operational activities.



We will not acquire or merge with any entity which does not intend to provide audited financial statements at or within a reasonable period of time after closing of the proposed transaction. We are subject to all the reporting requirements included in the Exchange Act. Included in these requirements is our duty to file audited financial statements as part of our Form 8-K to be filed with the Securities and Exchange Commission upon consummation of a merger or acquisition, as well as our audited financial statements included in our annual report on 10-KSB. If such audited financial statements are not available at closing, or within time parameters necessary to insure our compliance with the requirements of the Exchange Act, or if the audited financial statements provided do not conform to the representations made by the target business, the closing documents may provide that the proposed
transaction will be voidable at the discretion of our present management.



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We will not restrict our search for any specific kind of businesses, but may acquire a business which is in its preliminary or development stage, which is already in operation, or in essentially any stage of its business life. It is impossible to predict at this time the status of any business in which we may become engaged, in that such business may need to seek additional capital, may desire to have its shares publicly traded, or may seek other perceived advantages which we may offer.



A business combination with a target business will normally involve the transfer to the target business of the majority of our common stock, and the substitution by the target business of its own management and board of directors.



We have, and will continue to have, no capital with which to provide the owners of business opportunities with any cash or other assets. However, management believes we will be able to offer owners of acquisition candidates the opportunity to acquire a controlling ownership interest in a company with securities registered pursuant to Rule 12(g) of the Exchange Act. Our officer and director has not conducted market research and is not aware of statistical data to support the perceived benefits of a merger or acquisition transaction for the owners of a business opportunity.



Our audit reflects the fact that we have no current source of income. Further, that without realization of additional capital, it would be unlikely for the Company to continue as a going concern.



Our sole officer and director has agreed that he will advance any additional funds which we need for operating capital and for costs in connection with searching for or completing an acquisition or merger. Such advances have historically been converted to equity. There is no minimum or maximum amount the Officer and Director will advance to us. We will not borrow any funds for the purpose of repaying advances made by such Officer and Director, and we will not borrow any funds to make any payments to our promoters, management or their affiliates or associates.



The Board of Directors has passed a resolution which contains a policy that we will not seek an acquisition or merger with any entity in which our officer, director, stockholder or his affiliates or associates serve as officer or director or hold more than a 10% ownership interest.



Off-Balance Sheet Arrangements



We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.







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Going Concern



The financial statements included in this filing have been prepared in conformity with generally accepted accounting principles that contemplate the continuance of us as a going concern. Our lack of cash is inadequate to pay all of the costs associated with our operations. Management intends to use borrowings and security sales to mitigate the effects of its cash position, however no assurance can be given that debt or equity financing, if and when required will be available. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets and classification of liabilities that might be necessary should we be unable to continue existence.



ITEM 7.
        FINANCIAL STATEMENTS




See Index to Financial Statements and Financial Statement Schedules appearing on page F-1 through F-10 of this Form 10-KSB.



ITEM 8.
        CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE




NONE



ITEM 8A.
        CONTROLS AND PROCEDURES




We maintain disclosure controls and procedures designed to ensure that information required to be disclosed in reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the specified time periods.  As of the end of the period covered by this report, Anthony N. DeMint, our President and Chief Accounting Officer evaluated the effectiveness of our disclosure controls and procedures pursuant to Exchange Act Rule 13a-15. Based on the evaluation, which disclosed no significant deficiencies or material weaknesses, Mr. DeMint, our President and Chief Accounting Officer concluded that our disclosure controls and procedures are effective in timely alerting him to material information required to be included in our periodic SEC filings. There were no changes in our internal control over financial reporting that occurred during our
most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.



ITEM 8B.
        OTHER INFORMATION




NONE




PART III



ITEM 9.
        DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT




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Our Director and Officer is as follows:



Name
        Age
        Positions and Offices HeldAnthony N. DeMint
        33
        President, Secretary, Treasurer and Director




There are no agreements or understandings for the officer or director to resign at the request of another person and the above-named officer and director is not acting on behalf of nor will act at the direction of any other person.



Set forth below is the name of our director and officer, all positions and offices held with us, the period during which he has served as such, and the business experience during at least the last five years:



Anthony N. DeMint acts as President, Secretary, Treasurer and Director for the Company. Mr. DeMint has served as an Officer and Director of the Company since inception. Mr. DeMint is also sole officer and Director of Tac Asset Corp., Your Domain.Com, Nothing Corp., Calif Acquisitions, Inc., Take A Ride, Inc., Interbank Capital Corp., Tell-A-Tale Incorporated, Too Late Financial Corporation, Vanity Enterprises, Inc., Independent Asset Management Corp. and YFC 355 Corp which are also blank check companies.  Since 1997, Mr. DeMint has been president and managing director of the Securities Law Institute, a federal securities consulting firm. As the managing director of Securities Law Institute, Mr. DeMint has assisted numerous companies in strategic corporate structuring, merger and acquisition planning, and early round pre-financing guidance. Mr. DeMint also serves as CEO/President and a
Director of DaVinci-Franklin Fund I, LLC and DaVinci-Franklin Capital, private venture capital companies. In addition, Mr. DeMint has served as an officer and director for several public and private corporations. Mr. DeMint holds a B.A. Degree in Economics from the University of Nevada Las Vegas.  Further, Mr. DeMint currently holds a North American Securities Administrators Association (NASAA) Series 63 license.



CURRENT BLANK CHECK COMPANIES



The SEC reporting blank check companies that Anthony DeMint serves or has served as President and Director are listed in the following table:



Incorporation Name
        Form Type
        File #
        Date of Filing
        Status (l)Intercontinental Capital Fund, Inc.
        10SB12G
        000-27931
        04 Nov 99
        Merger (2a)Tele Special.Com
        10SB12G
        000-28207
        19 Nov 99
        Merger (2b)Navitec Group Inc.
        10SB12G
        000-28225
        22 Nov 99
        Merger (2c)Royal Acquisitions, Inc.
        10SB12G
        000-28713
        30 Dec 99
        Merger (2d)LifePlan
        10SB12G
        000-29033
        08 Jan 00
        Merger (2e)Central America Fuel Technology, Inc.
        10SB12G
        000-28697
        29 Dec 99
        Merger (2f)Scientific Fuel Technology, Inc.
        10SB12G
        000-28685
        28 Dec 99
        Merger (2g)






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TourPro Golf, Inc.
        10SB12G
        000-28569
        20 Dec 99
        Merger (2h)J.S.J. Capital Corp,
        10SB12G
        000-29165
        26 Jan 00
        Merger (2i)Euro Technology Outfitters
        10SB12G
        000-30009
        20 Mar 00
        Merger (2j)SAVEYOUTIME.COM, INC.
        10SB12G
        000-30085
        23 Mar 00
        Merger (2k)Rub Investments Limited
        10SB12G
        000-29315
        03 Feb 00
        Merger(2l)J.S.J. Capital II, Inc.
        10SB12G
        000-29189
        27 Jan 00
        Sold (3)One Move Entertainment, Inc.
        10SB12G
        000-30055
        22 Mar 00
        (4)Independent Asset Management Corp.
        10SB12G
        000-29451
        11 Feb 00
        (5)Tac Asset Corp.
        10SB12G
        000-29355
        07 Feb 00
        NoYour Domain.com
        10SB12G
        000-29317
        03 Feb 00
        NoNothing Corp.
        10SB12G
        000-29399
        08 Feb 00
        NoCalif Acquisitions, Inc.
        10SB12G
        000-29345
        04 Feb 00
        NoTake A Ride, Inc.
        10SB12G
        000-30113
        27 Mar 00
        NoInterbank Capital Corp.
        10SB12G
        000-30067
        23 Mar 00
        NoTell-A-Tale, Incorporated
        10SB12G
        000-30131
        28 Mar 00
        NoToo Late Financial Corporation
        10SB12G
        000-30149
        29 Mar 00
        NoVanity Enterprises, Inc.
        10SB12G
        000-30169
        31 Mar 00
        NoYFC 355 Corp
        10SB12G
        000-30201
        03 Apr 00
        No




(1)Under Merger Status "Merger" represents either a merger or an acquisition has occurred or the company ceased to be a blank check company by operating specific business. A "No" represents that the company is currently seeking merger or acquisition candidate. More detailed information for each merger is disclosed in following paragraphs.



(2)
        (2a)  In January 2000 Intercontinental Capital Fund, Inc. merged with Desert Health Products, Inc. (DHP) whereby DHP was the surviving corporation and Intercontinental Capital Fund ceased to exist. DHP was formed to develop dietary supplement products from natural plant extracts. At the time of the merger DHP was focusing its development efforts on certain plants and plant extracts that are widely used throughout the United States and Europe to treat a variety of diseases and physical conditions. Pursuant to the Plan of Merger, DHP issued 400,000 shares of restricted Common Stock to Anthony N.




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DeMint in exchange for the cancellation of Mr. DeMints 5,000,000 shares of Intercontinental Capital Fund Common Stock. DHP paid $100,000 in cash to SY&S, of which Anthony N. DeMint is an affiliate, for consulting fees associated with the merger. Mr. DeMint currently is a non-affiliated stockholder of DHP.



(2b)  In January 2000 Tele Special.Com merged with International Brands, Inc. (INBR) whereby INBR was the surviving corporation and Tele Special.Com ceased to exist. At the time of the merger INBR was a holding company for various Internet related companies. Pursuant to the Plan of Merger, INBR issued 25,000 shares of restricted Common Stock to Anthony N. DeMint in exchange for the cancellation of Mr. DeMints 5,000,000 shares of Tele Special.Com Common Stock. INBR paid $150,000 in cash to SY&S, of which Anthony N. DeMint is an affiliate, for consulting fees associated with the merger. Mr. DeMint currently is a non-affiliated stockholder of INBR.



(2c)  In February 2000 Navitec Group, Inc. merged with Worldnet Resources Group, Inc. (WRGI) whereby WRGI was the surviving corporation and Navitec Group, Inc. ceased to exist. At the time of the merger WRGI was a holding company for various Internet related companies. Pursuant to the Plan of Merger, WRGI issued 2,083 shares of restricted Common Stock to Anthony N. DeMint in exchange for the cancellation of Mr. DeMints 5,000,000 shares of Navitec Group Common Stock. WRGI paid $150,000 in cash to SY&S, of which Anthony N. DeMint is an affiliate, for consulting fees associated with the merger. Mr. DeMint currently is a non-affiliated stockholder of WRGI.



(2d)  In March 2000 Royal Acquisitions, Inc. merged with zebramart.Com, Inc. (ZMRT) whereby ZMRT was the surviving corporation and Royal Acquisitions, Inc. ceased to exist.  Pursuant to the Plan of Merger, ZMRT issued 2,000,000 shares of restricted Common Stock to Anthony N. DeMint in exchange for the cancellation of Mr. DeMints 5,000,000 shares of Royal Acquisitions, Inc. Common Stock. ZMRT paid $200,000 in cash to SY&S, of which Anthony N. DeMint is an affiliate, for consulting fees associated with the merger.



(2e)  In March 2000 LifePlan merged with HIV-VAC, INC. (HIVC) whereby HIVC was the surviving corporation and LifePlan ceased to exist.  Pursuant to the Plan of Merger, HIVC issued 100,000 shares of restricted Common Stock to Anthony N. DeMint in exchange for the cancellation of Mr. DeMints 10,000,000 shares of LifePlan Common Stock. Mr. DeMint currently is a non-affiliated stockholder of HIVC.



(2f)  In March 2000 Central America Fuel Technology, Inc. merged with Presidents Telecom, Inc. (PRTE) whereby PRTE was the surviving corporation and Central America Fuel Technology, Inc. ceased to exist. At the time of the merger PRTE established satellite communications world wide to Costa Rican companies.  Pursuant to the Plan of Merger, PRTE issued 5,000 shares of restricted Common Stock to Anthony N. DeMint in exchange for the cancellation of Mr. DeMints 10,000,000 shares of Central America Fuel Technology, Inc. Common Stock. Mr. DeMint currently is a non-affiliated stockholder of PRTE.



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(2g)  In March 2000 Scientific Fuel Technology, Inc. merged with Vertical Computers Systems, Inc. (VCSY) whereby Vertical Computers Systems, Inc. was the surviving successor corporation and Scientific Fuel Technology, Inc.  ceased to exist.  At the time of the merger VCSY was a multi-lingual portal and Internet solutions provider for foreign countries, developing nations and regions of the world where access and content is limited.  Pursuant to the Plan of Merger, VCSY issued 2,000,000 shares of restricted Common Stock to Anthony N. DeMint in exchange for the cancellation of Mr. DeMints 10,000,000 shares of Scientific Fuel Technology, Inc. Common Stock.



(2h)  In March 2000 TourPro Golf, Inc. merged with Mirage Computers, Inc. whereby Mirage Computers, Inc. n/k/a Mega Micro Technologies Group. (MMTG) was the surviving successor corporation and TourPro Golf, Inc. ceased to exist.  At the time of the merger Mirage was in the business of acquiring and developing a group of synergistic technology related companies, which will share customer databases, administration and marketing costs.  Pursuant to the Plan of Merger, MMTG issued 150,000 shares of restricted Common Stock to Anthony N. DeMint in exchange for the cancellation of Mr. DeMints 4,800,000 shares of TourPro Golf, Inc. Common Stock. Mr. DeMint currently is a non-affiliated stockholder of MMTG.



(2i)  In April 2000 J.S.J. Capital Corp. merged with High Speed Net Solutions, Inc. (HSNS) whereby HSNS was the surviving successor corporation and J.S.J. Capital Corp. Inc. ceased to exist.  At the time of the merger HSNS was in the business of delivering audio, video and graphics content and advertising over the Internet.  Pursuant to the Plan of Merger, HSNS issued 50,000 shares of restricted Common Stock to Anthony N. DeMint in exchange for the cancellation of Mr. DeMints 672,000 shares of J.S.J. Capital Corp. Common Stock.



(2j)  On August 19, 2002, Euro Technology Outfitters executed an Asset Purchase Agreement with Petrol Energy, Inc., whereby Euro Technology Outfitters issued 10,918,300 shares of its restricted common stock in exchange for certain assets and liabilities of Petrol Energy.  The assets that were acquired included approximately 289 oil and gas mineral leases.



On August 20, 2002, Euro Technology Outfitters amended its Articles of Incorporation to change its name from Euro Technology Outfitters to Petrol Oil and Gas, Inc.



On August 21, 2002, Anthony N. DeMint, Petrols sole Officer and Director, appointed Paul Branagan as a director of the Company and subsequently resigned, leaving Mr. Branagan as the Companys sole director. Following his appointment, Mr. Branagan elected himself as the sole officer of the Company.  Further, concurrent with his resignation, Mr. DeMint tendered 5,826,240 shares of Petrol Oil and Gas, Inc. stock back to the Company for cancellation.



(2k)  On April 10 2003, Saveyoutime.com, Inc. (SCI) completed a Merger with Hesperia Holding Corp. (Hesperia) wherein, (i) SCI issued 10,415,845 shares of common stock, in a 1:1 exchange, for 100% of the Hesperia issued and outstanding, and



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(ii) SCI changed its name to Hesperia Holdings, Inc. and qualified to do business in California.  Hesperia was formed in July 2002, as a California corporation and is a holding company for its subsidiary, Hesperia Truss, which is in the business of designing and building prefabricated wood trusses.  Additionally, pursuant to the Agreement and Plan of Merger, Anthony N. DeMint the sole stockholder of SCI canceled 6,454,370 shares leaving 50,000 shares of SCI issued and outstanding.  Post Merger closing, there was a total of 10,465,845 shares issued and outstanding.



(2l)  On May 30, 2005, Rub Investments Limited (RUB) completed a Merger with ISSG, Inc. (ISSG) wherein, (i) RUB issued 10,583,546 shares of common stock, in a 1:1 exchange, for 100% of the ISSG issued and outstanding, and (ii) Rub changed its name to ISSG, Inc.  ISSG was formed on June 2, 2005, as a Delaware corporation which has developed a new and revolutionary hot water dispensing system that will brew one fresh cup of coffee, tea, hot chocolate, soup, etc. on demand. The appliance features a rotating cylinder with six (6) individual compartments, each with its own permanent filter.  Pursuant to the terms of the acquisition, ISSG issued 150,000 shares of restricted common stock to Anthony N. DeMint the sole stockholder of RUB and all of the issued and outstanding shares of RUB were cancelled.



(3)In May 2000 Anthony DeMint acquired 672,000 shares of J.S.J. Capital II, Inc. for $175,000 in cash.



In July 2000 Anthony DeMint resigned as sole Officer and Director of J.S.J. Capital II, Inc. and sold 100% of his shares in the Company for $175,000.



(4)On February 25, 2005 Jeffrey F. Speakman was appointed to the Board of Directors. Concurrently, Anthony N. DeMint resigned as a Director, President, Secretary and Treasurer and Mr. Speakman was appointed the sole officer.



(5)On August 1, 2005, Anthony N. DeMint was appointed to the Board of Directors of Independent Asset Management Corp. Concurrently, Debra K. Amigone resigned as a Director, President, Secretary and Treasurer and Mr. DeMint was appointed the sole officer and is currently the sole Director.



CONFLICTS OF INTEREST



Our officer and director expects to organize other companies of a similar nature and with a similar purpose as us. Consequently, there are potential inherent conflicts of interest in acting as our officer and director. Insofar as the officer and director is engaged in other business activities, management anticipates that he will devote only a minor amount of time to our affairs. We do not have a right of first refusal pertaining to opportunities that come to management's attention insofar as such opportunities may relate to our proposed business operations.



A conflict may arise in the event that another blank check company with which management is affiliated is formed and actively seeks a target company. It is anticipated that target companies will be located for us and other blank check companies in chronological order



12



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of the date of formation of such blank check companies or, in the case of blank check companies formed on the same date, alphabetically. However, any blank check companies with which management is, or may be, affiliated may differ from us in certain items such as place of incorporation, number of shares and stockholder, working capital, types of authorized securities, or other items. It may be that a target company may be more suitable for or may prefer a certain blank check company formed after us. In such case, a business combination might be negotiated on behalf of the more suitable or preferred blank check company regardless of date of formation.



The terms of business combination may include such terms as Mr. DeMint remaining a director or officer of the Company and/or the continuing securities work of the Company being handled by the consulting firm of which Mr. DeMint is a director. The terms of a business combination may provide for a payment by cash or otherwise to Mr. DeMint for the purchase or retirement of all or part of his common stock of the Company by a target company or for services rendered incident to or following a business combination. Mr. DeMint would directly benefit from such employment or payment. Such benefits may influence Mr. DeMints choice of a target company.



We may agree to pay finder's fees, as appropriate and allowed, to unaffiliated persons who may bring a target company to us where that reference results in a business combination. No finder's fee of any kind will be paid by us to management or our promoters or to their associates or affiliates. No loans of any type have, or will be, made by us to management or our promoters of or to any of their associates or affiliates.



There are no binding guidelines or procedures for resolving potential conflicts of interest. Failure by management to resolve conflicts of interest in favor of us could result in liability of management to us. However, any attempt by stockholders or our stockholder to enforce a liability of management to us would most likely be prohibitively expensive and time consuming.



Section 16(a) Beneficial Ownership Reporting Compliance



Section 16(a) of the Securities Exchange Act of 1934, as amended (the Exchange Act), requires our officers and directors, and persons who beneficially own more than ten percent of our common stock, to file initial reports of ownership and reports of changes in ownership with the SEC. Executive officers, directors and greater than ten percent beneficial owners are required by SEC regulations to furnish us with copies of all Section 16(a) forms they file. Based upon a review of the copies of such forms furnished to us and written representations from our executive officer and director, we believe that during the year ended 2006 all forms 3 and 4 were filed on a timely basis.



Audit Committee and Financial Expert



We do not have an Audit Committee, Anthony N. DeMint, our sole director, performs some of the same functions of an Audit Committee, such as: recommending a firm of independent certified public accountants to audit the annual financial statements; reviewing the independent auditors independence, the financial statements and their audit report; and reviewing management's administration of the system of internal accounting controls. The Company does not currently have a written audit committee charter or similar document.



13



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We have no financial expert. We believe the cost related to retaining a financial expert at this time is prohibitive. Further, because of our start-up operations, we believe the services of a financial expert are not warranted.



Code of Ethics



A code of ethics relates to written standards that are reasonably designed to deter wrongdoing and to promote:



1.
        Honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;


2.
        Full, fair, accurate, timely and understandable disclosure in reports and documents that are filed with, or submitted to, the Commission and in other public communications made by an issuer;


3.
        Compliance with applicable governmental laws, rules and regulations;


4.
        The prompt internal reporting of violations of the code to an appropriate person or persons identified in the code; and


5.
        Accountability for adherence to the code.




We have not adopted a corporate code of ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions in that our sole officer and director serves in all the above capacities.



Our decision to not adopt such a code of ethics results from our having only one officer and director operating as the sole management for the Company. We believe that as a result of the limited interaction which occurs having a sole officer/director for the Company eliminates the current need for such a code, in that violations of such a code would be reported to the party generating the violation.



Nominating Committee



We do not have a Nominating Committee or Nominating Committee Charter. Anthony N. DeMint, our sole director, performs some of the functions associated with a Nominating Committee. We have elected not to have a Nominating Committee in that we are a development stage company with limited operations and resources.



ITEM 10.
        EXECUTIVE COMPENSATION




Our officer and director does not receive any compensation for his services rendered, has not received such compensation in the past, and is not accruing any compensation pursuant to any agreement with us.  However, our officer and director anticipates receiving benefits as a beneficial stockholder and, possibly, in other ways upon consummation of a merger/acquisition transaction.



14



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No retirement, pension, profit sharing, stock option or insurance programs or other similar programs have been adopted by us for the benefit of our employees.



Compensation Committee



We do not have a formal Compensation Committee. Anthony N. DeMint, our sole director, performs some of the functions of a Compensation Committee.  Due to the lack of revenues, our lack of payment of any executive compensation and our development stage status, we deemed a Compensation Committee to not be necessary at this time.



ITEM 11.
        SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDERS MATTERS.




The following table sets forth, as of December 31, 2006, each person known by us to be the beneficial owner of five percent or more of our Common Stock and our director and officer. Except as noted, the holder thereof has sole voting and investment power with respect to the shares shown.



Name and Address
			Of Beneficial Owner
        Amount of Beneficial Ownership
        Percent of
Outstanding StockAnthony N. DeMint
        9,716,370
        100%770 E. Warm Springs Rd., #250Las Vegas, NV 89119All Executive Officers andDirectors as a Group(1 Person)
        9,716,370
        100%




ITEM 12.
        CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, DIRECTORS INDEPENDENCE.




On January 14, 2005, the Company issued Mr. DeMint 250,000 shares of its $.001 par value common stock for conversion of debt to equity of $250.  The shares were deemed to have been issued pursuant to an exemption provided by Section 4(2) of the Act, which exempts from registration transactions by an issuer not involving a public offering.



On February 16, 2005, the Company issued Mr. DeMint 750,000 shares of its $.001 par value common stock for conversion of debt to equity of $750.  The shares were deemed to have been issued pursuant to an exemption provided by Section 4(2) of the Act, which exempts from registration transactions by an issuer not involving a public offering.





15



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ITEM 13.
        EXHIBITS




3(i)*
        Articles of Incorporation filed as an exhibit to the Company's registration statement on Form 10-SB filed on February 7, 2000, and incorporated herein by reference.3(ii)*
        By-Laws filed as an exhibit to the Company's registration statement on Form 10-SB filed on February 7, 2000, and incorporated herein by reference.4.1*
        Article VI of Articles of Incorporation filed as an exhibit to the Company's registration statement on Form 10-SB filed on February 7, 2000, and incorporated herein by reference.4.2*
        Article II and Article VIII, Sections 3 and 6 of By-Laws filed as an exhibit to the Company's registration statement on Form 10-SB filed on February 7, 2000, and incorporated herein by reference.31**
        Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32**
        Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.


*
        Previously filed


**
        Filed herewith




ITEM 14.
        PRINCIPAL ACCOUNTANT FEES AND SERVICES




(1) AUDIT FEES



The aggregate fees billed for professional services rendered by Weaver & Martin, LLC, for the audit of the registrant's annual financial statements and review of the financial statements included in the registrant's Form 10-QSBs or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for the fiscal years 2006 and 2005 were $1,750 and $1,750 respectively.



(2) AUDIT-RELATED FEES



None



(3) TAX FEES



None

(4) ALL OTHER FEES



None



(5) AUDIT COMMITTEE POLICIES AND PROCEDURES



The Company does not have an audit committee.



(6)If greater than 50 percent, disclose the percentage of hours expended on the principal accountant's engagement to audit the registrant's financial statements for the most recent fiscal year that were attributed to work performed by persons other than the principal accountant's full-time, permanent employees.



Not applicable.



16



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SIGNATURES



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



ACCESSORY SPECIALISTS INCORPORATED.



By:/s/ Anthony N. DeMint


Anthony N. DeMint, President



Dated:
        January 29, 2007




Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.



NAME
        OFFICE
        DATE/s/ Anthony N. DeMintAnthony N. DeMint
        President, Secretary,
        January 29, 2007Treasurer, ChiefAccounting Officer,And Director






17



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TABLE OF CONTENTS

PAGE

INDEPENDENT AUDITOR'S REPORT
        F-1BALANCE SHEETS
        F-2STATEMENTS OF OPERATIONS
        F-3STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
        F-4STATEMENTS OF CASH FLOWS
        F-5NOTES TO FINANCIAL STATEMENTS
        F-6  F-10






18



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Report of Independent Registered Public Accounting Firm



Stockholders and Directors



We have audited the accompanying balance sheets of Accessory Specialists Incorporated(A Development Stage Company) as of December 31, 2006 and 2005 and the related statements of operations, shareholders deficit, and cash flows for the fiscal years ended December 31, 2006 and 2005 and from January 18, 2000 (Date of Inception) to December 31, 2006. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audits.



We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.



In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Accessory Specialists Incorporated (A Development Stage Company) as of December 31, 2006 and 2005 and the results of its operations and cash flows for the fiscal years ended December 31, 2006 and 2005 and from January 18, 2000 (Date of Inception) to December 31, 2006, in conformity with U.S. generally accepted accounting principles.



The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company has had limited operations and has not commenced planned principal operations. This raises substantial doubt about the Companys ability to continue as a going concern. Managements plans with regard to these matters are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.









Weaver & Martin, LLC

Kansas City, Missouri

January 23, 2007



F-1



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Accessory Specialists Incorporated

(a development stage company)

Balance Sheets



December 31,
        December 31,2006
        2005AssetsCurrent assets:Cash
        $                    -
        $                    -Total current assets
        -
        -$                    -
        $                    -Liabilities and Stockholders EquityCurrent liabilities
        $                    -
        $                    -Stockholders EquityPreferred stock, $.001 par value 5,000,000 shares authorized zero issued and Outstanding
        -
        -Common stock, $.001 par value, 20,000,000 shares authorized; 9,716,370 shares issued and outstanding as of December 31, 2006 and 2005, respectively
        9,716
        9,716Additional paid in capital
        3,500
        1,750(Deficit) accumulated during development stage
        (13,216)
        (11,466)-
        -$                    -
        $                    -




The accompanying notes are an integral part of these financial statements



F-2



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Accessory Specialists Incorporated

(a development stage company)

Statements of Operations

For the Twelve Months Ending December 31, 2006 and 2005

And For the Period January 18, 2000 (Inception) to December 31, 2006





For the Years Ended
December 31,
        January 18, 2000
(Inception) to December 31, 20062006
        2005Revenue
        $                     -
        $                     -
        $                      -Expenses:General and administrative expenses
        1,750
        2,500
        12,934Organization cost
        -
        -
        282Total Expenses
        1,750
        2,500
        13,216Net (loss)
        $           (1,750)
        $          (2,500)
        $         (13,216)Weighted average number of common shares outstanding  basic and fully diluted
        9,716,370
        9,610,206Net (loss) per share  basic and fully diluted
        $             (0.00)
        $            (0.00)




The accompanying notes are an integral part of these financial statements



F-3



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Accessory Specialists Incorporated

(a development stage company)

Statements of Changes in Stockholders Equity



Common Stock
Shares          Amount
        Additional
paid-in
Capital
        (Deficit)
accumulated
during
development
stage
        Total Stockholders EquityJanuary 18, 2000 issued for services
        5,000,000
        $5,000
        $              -
        $                 -
        $            5,000Net (loss), January 18, 2000 (inception) to December 31, 2000
        
        
        
        (6,167)
        (6,167)Balance December 31, 2000
        5,000,000
        5,000
        -
        (6,167)
        (1,167)January 1, 2001 Shares issued for debt
        1,467,000
        1,467
        -
        
        1,467April 1, 2001 Shares issued for debt
        22,060
        22
        -
        
        22July 1, 2001 Shares issued for debt
        13,240
        13
        -
        
        13October 1, 2001 Shares issued for debt
        14,060
        14
        -
        
        14Net (loss) December 31, 2001
        
        
        
        (349)
        (349)Balance December 31, 2001
        6,516,360
        6,516
        -
        (6,516)
        -April 1, 2002 Shares issued for debt
        21,880
        22
        -
        
        22September 30, 2002 Shares issued for debt
        28,130
        28
        -
        
        28December 31, 2002 Shares issued for debt
        100,000
        100
        -
        
        100Net (loss) December 31, 2002
        
        
        
        (150)
        (150)Balance December 31, 2002
        6,666,370
        6,666
        -
        (6,666)
        -April 28, 2003 Shares issued for debt
        500,000
        500
        -
        -
        500June 17, 2003 Shares issued for debt
        100,000
        100
        -
        -
        100September 29, 2003 Share issued for debt
        100,000
        100
        -
        -
        100December 31, 2003 Shares issued for debt
        100,000
        100
        -
        
        100Net (loss) December 31, 2003
        
        
        
        (800)
        (800)Balance December 31, 2003
        7,466,370
        7,466
        -
        (7,466)
        -June 15, 2004 Shares issued for debt
        1,000,000
        1,000
        -
        -
        1,000September 29, 2004 Share issued for debt
        250,000
        250
        -
        -
        250Net (loss) December 31, 2004
        
        
        
        (1,500)
        (1,500)Balance December 31, 2004
        8,716,370
        8,716
        -
        (8,966)
        (250)January 14, 2005 Shares issued for debt
        250,000
        250
        -
        -
        250February 16, 2005 Shares issued for debt
        750,000
        750
        -
        -
        750December 31, 2005 Donated capital
        -
        -
        1,750
        -
        1,750Net (loss) December 31, 2005
        -
        -
        -
        (2,500)
        (2,500)Balance December 31, 2005
        9,716,370
        9,716
        1,750
        (11,466)
        -December 31, 2006 Donated capital
        -
        -
        1,750
        -
        1,750Net (loss) December 31, 2006
        -
        -
        -
        (1,750)
        (1,750)Balance December 31, 2006
        9,716,370
        $   9,716
        $       3,500
        $      (13,216)
        $                    -




The accompanying notes are an integral part of these financial statements



F-4



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Accessory Specialists Incorporated

(a development stage company)

Statements of Cash Flows

For the Twelve Months Ending December 31, 2006 and 2005

And For the Period January 18, 2000 (Inception) to December 31, 2006



For the Years Ended
December 31,
        January 18, 2000 (Inception) to December 31, 20062006
        2005Cash flows from operating activities:Net (loss)
        $           (1,750)
        $           (2,500)
        $           (13,216)Amortization
        -
        -
        282Stock issued for services
        -
        -
        5,000Conversion of debt to equity
        -
        1,000
        4,716Changes in assets and liabilitiesNote payable  related party
        -
        (250)
        -Net cash (used) by operating activities
        (1,750)
        (1,750)
        (3,218)Cash flows from investing activities:Organization costs
        -
        -
        (282)Donated Capital
        1,750
        1,750
        3,500Net Cash (used) in Investing activities
        1,750
        1,750
        3,218Net (decrease) increase in cash
        -
        -
        -Cash -beginning
        -
        -
        -Cash - ending
        $                     -
        $                     -
        $                      -Supplemental disclosureInterest paid
        $                     -
        $                     -
        $                      -Income taxes paid
        $                     -
        $                     -
        $                      -Non-cash transactions:Number of shares issued for services
        -
        -
        5,000,000Number of shares issued to convert debt to equity
        -
        1,000,000
        4,716,370




The accompanying notes are an integral part of these financial statements



F-5



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Accessory Specialists Incorporated

(a development stage company)

Notes



Note 1  Significant accounting policies and procedures



Organization

The Company is currently a development stage company under the provisions of the Financial Accounting Standards Board ("FASB") Statement of Financial Accounting Standards ("SFAS") No. 7. The Company was incorporated under the laws of the State of Nevada on January 18, 2000.



Estimates

The preparation of financial statements in conformity with generally accepted accounting principles 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 revenue and expenses during the reporting period.  Actual results could differ from those estimates.



Reporting on the costs of start-up activities

Statement of Position 98-5 (SOP 98-5), Reporting on the Costs of Start-Up Activities, which provides guidance on the financial reporting of start-up costs and organizational costs, requires most costs of start-up activities and organizational costs to be expensed as incurred.  SOP 98-5 is effective for fiscal years beginning after December 15, 1998.  With the adoption of SOP 98-5, there has been little or no effect on the Companys financial statements.



Loss per share

Net loss per share is provided in accordance with Statement of Financial Accounting Standards No. 128 (SFAS #128) Earnings Per Share. Basic loss per share is computed by dividing the net income by the weighted average number of common shares outstanding available to common stockholders during the period.  The basic weighted average number of common shares outstanding was 9,716,370 and 9,610,206 for the years ended December 31, 2006 and 2005, respectively.



Advertising Costs

The Company expenses all costs of advertising as incurred.  There were no advertising costs included in selling, general and administrative expenses for the period ended December 31, 2006.



Research and Development Costs

Research and development costs are charged to expense when incurred rather than recorded as inventory, component of overhead, or otherwise capitalized. Depreciation expense related to such capitalized costs should be considered research and development costs.





F-6



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Accessory Specialists Incorporated

(a development stage company)

Notes



Fair value of financial instruments

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of December 31, 2006.  The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values. These financial instruments include cash and accounts payable. Fair values were assumed to approximate carrying values for cash and payables because they are short term in nature and their carrying amounts approximate fair values or they are payable on demand.



Segment reporting

The Company follows Statement of Financial Accounting Standards No. 130, Disclosures About Segments of an Enterprise and Related Information. The Company operates as a single segment and will evaluate additional segment disclosure requirements as it expands its operations.



Dividends

The Company has not yet adopted any policy regarding payment of dividends.  No dividends have been paid or declared since inception.



Income taxes

The Company follows Statement of Financial Accounting Standard No. 109, Accounting for Income Taxes (SFAS No. 109) for recording the provision for income taxes.  Deferred tax assets and liabilities are computed based upon the difference between the financial statement and income tax basis of assets and liabilities using the enacted marginal tax rate applicable when the related asset or liability is expected to be realized or settled.  Deferred income tax expenses or benefits are based on the changes in the asset or liability each period.  If available evidence suggests that it is more likely than not that some portion or all of the deferred tax assets will not be realized, a valuation allowance is required to reduce the deferred tax assets to the amount that is more likely than not to be realized.  Future changes in such valuation allowance are included in the provision for deferred
income taxes in the period of change.



Deferred income taxes may arise from temporary differences resulting from income and expense items reported for financial accounting and tax purposes in different periods.  Deferred taxes are classified as current or non-current, depending on the classification of assets and liabilities to which they relate.  Deferred taxes arising from temporary differences that are not related to an asset or liability are classified as current or non-current depending on the periods in which the temporary differences are expected to reverse.







F-7



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Accessory Specialists Incorporated

(a development stage company)

Notes



In December 2004, the FASB issued SFAS No. 123 (revised 2004). Share-Based Payment, which is a revision of SFAS No. 123, Accounting for Stock-Based Compensation. SFAS No. 123(R) supersedes APB Opinion No. 25, Accounting for Stock Issued to Employees and amends SFAS No. 95, Statement of Cash Flows. Generally, the approach in SFAS No. 123(R) is similar to the approach described in SFAS No. 123. However, SFAS No. 123(R) 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. The new standard was effective for the Company in the first interim or annual reporting period beginning after December 15, 2005. The Company expects the adoption of this standard will have a material impact on its financial statements assuming employee stock options are granted in the future.



Year end

The Company has adopted December 31 as its fiscal year end.



Note 2 - Going concern



The accompanying financial statements have been prepared assuming the Company will continue as a going concern.  As shown in the accompanying financial statements, the Company has incurred a net loss of $13,216 for the period from inception to December 31, 2006, and has no sales.  The future of the Company is dependent upon its ability to obtain financing and upon future profitable operations from the development of its new business opportunities.  Management has plans to seek additional capital through private placements and public offerings of its common stock.  The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence.



These conditions raise substantial doubt about the Company's ability to continue as a going concern.  These financial statements do not include any adjustments that might arise from this uncertainty.



Note 3  Income taxes



For the period ended December 31, 2006 the Company incurred net operating losses and accordingly, no provision for income taxes has been recorded. In addition, no benefit for income taxes has been recorded due to the uncertainty of the realization of any tax assets. At December 31, 2006, the Company had approximately $13,216 of federal and state net operating losses. The net operating loss carryforwards, if not utilized will begin to expire in 2020.



The components of the Companys deferred tax asset are as follows:



F-8



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Accessory Specialists Incorporated

(a development stage company)

Notes



As of December 31,
        As of December 31,2006
        2005Deferred tax assets:Net operating loss carryforwards
        $          4,626
        $          4,013Total deferred tax assets
        4,626
        4,013Deferred tax liabilities:Depreciation
        -0-
        -0-Net deferred tax assets before valuation allowance
        4,626
        4,013Less: Valuation allowance
        (4,626)
        (4,013)Net deferred tax assets
        $                -0-
        $                -0-




For financial reporting purposes, the Company has incurred a loss in each period since its inception. Based on the available objective evidence, including the Companys history of losses, management believes it is more likely than not that the deferred tax assets will not be fully realizable. Accordingly, the Company provided a full valuation allowance against its net deferred tax assets at December 31, 2006.



Note 4  Stockholders' equity



The Company is authorized to issue 20,000,000 shares of $0.001 par value common stock and 5,000,000 shares of $0.001 par valued preferred stock.



On January 18, 2000, the Company issued the sole officer of the Company 5,000,000 shares of its $.001 par value common stock for services valued at $5,000.



On January 1, 2001, the Company issued the sole officer of the Company 1,467,000 shares of its $.001 par value common stock for conversion of debt to equity in the amount of $1,467.



On April 1, 2001, the Company issued the sole officer of the Company 22,060 shares of its $.001 par value common stock for conversion of debt to equity in the amount of $22.



On July 1, 2001, the Company issued the sole officer of the Company 13,240 shares of its $.001 par value common stock for conversion of debt to equity in the amount of $13.



On October 1, 2001, the Company issued the sole officer of the Company 14,060 shares of its $.001 par value common stock for conversion of debt to equity in the amount of $14.





F-9



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Accessory Specialists Incorporated

(a development stage company)

Notes



On April 1, 2002, the Company issued the sole officer of the Company 21,880 shares of its $.001 par value common stock for conversion of debt to equity in the amount of $22.



On September 30, 2002, the Company issued the sole officer of the Company 28,130 shares of its $.001 par value common stock for conversion of debt to equity in the amount of $28.



On December 31, 2002, the Company issued the sole officer of the Company 100,000 shares of its $.001 par value common stock for conversion of debt to equity in the amount of $100.



On April 28, 2003, the Company issued the sole officer of the Company 500,000 shares of its $.001 par value common stock for conversion of debt to equity in the amount of $500.



On June 17, 2003, the Company issued the sole officer of the Company 100,000 shares of its $.001 par value common stock for conversion of debt to equity in the amount of $100.



On September 29, 2003, the Company issued the sole officer of the Company 100,000 shares of its $.001 par value common stock for conversion of debt to equity in the amount of $100.



On December 31, 2003, the Company issued the sole officer of the Company 100,000 shares of its $.001 par value common stock for conversion of debt to equity in the amount of $100.



On June 15, 2004, the Company issued the sole officer of the Company 1,000,000 shares of its $.001 par value common stock for conversion of debt to equity in the amount of $1,000.



On September 29, 2004, the Company issued the sole officer of the Company 250,000 shares of its $.001 par value common stock for conversion of debt to equity in the amount of $250.



On January 14, 2005, the Company issued the sole officer of the Company 250,000 shares of its $.001 par value common stock for conversion of debt to equity in the amount of $250.



On February 16, 2005, the Company issued the sole officer of the Company 750,000 shares of its $.001 par value common stock for conversion of debt to equity in the amount of $750.



There have been no other issuances of common stock.





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