**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


Washington,
      D.C. 20549





**FORM
      10-QSB**


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


**EXCHANGE
      ACT OF 1934**





**For
      the Quarterly Period Ended March 31, 2007**





or





**[
      ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES**


**EXCHANGE
      ACT OF 1934**





*Commission
      File Number 0-28541*





**QUINTEK
      TECHNOLOGIES, INC.**





(Exact
      name of registrant as specified in its charter)




California
            
            77-0505346(State
                or other
                jurisdiction
            
            (I.R.S.
                Employerof
                incorporation or
                organization)
            
            Identification
                No.)17951
                Lyons CircleHuntington
                Beach, CA
                92647(Address
                of principal executive offices)





Registrant's
      telephone number: 714-848-7741





Check
      whether the registrant (1) has filed all reports required to be filed by Section
      13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12
      months (or for such shorter period that the registrant was required to file
      such
      reports), and (2) has been subject to such filing requirements for the past
      90
      days. Yes [X] No [ ]





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





At
      May
      10, 2007, a total of 163,521,341 shares of registrant's Common Shares were
      outstanding.





Transitional
      Small Business Disclosure Format: Yes [ ] No [X]









**QUINTEK
      TECHNOLOGIES, INC.**


**FORM
      10-QSB**




**For
      the Fiscal Quarter Ended March 31, 2007**







Part
                  I
              
              PageItem
                  1.
              Financial
                  Statements (unaudited)
              3Item
                  2.
              Management's
                  Discussion and Analysis or Plan of Operations
              19Item
                  3.
              Controls
                  and Procedures
              25Part
                  ll
              
              PageItem
                  1.
              Legal
                  Proceedings
              26Item
                  2.
              Unregistered
                  Sale of Equity Securities and Use of Proceeds
              26Item
                  3.
              Defaults
                  Upon Senior Securities
              26Item
                  4.
              Submission
                  of Matters to a Vote of Security Holders
              27Item
                  5.
              Other
                  Information
              27Item
                  6.
              Exhibits
              27
  2
 
  **PART
            I - FINANCIAL INFORMATION**
 
 **Item
            1. Financial Statements**
 **QUINTEK
                      TECHNOLOGIES, INC. AND SUBSIDIARIES****CONSOLIDATED
                      BALANCE SHEET****AS
                      OF MARCH 31, 2007****(Unaudited)**
  **ASSETS**Current
                      assets:Cash
                      and cash equivalents
                  
                  $
                  122,419Accounts
                      receivable, net of allowance for doubtful accounts of
                      $4,496
                  
                  
                  356,003Other
                      current assets
                  
                  
                  1,060Total
                      current assets
                  
                  
                  479,482Property
                      and equipment, net
                  
                  
                  342,614Other
                      assets:Deposits
                  
                  
                  108,935Derivative
                      asset
                  
                  
                  1,627,407Other
                      assets
                  
                  
                  883Total
                      other assets
                  
                  
                  1,737,225$
                  2,559,321**LIABILITIES
                      AND STOCKHOLDERS' DEFICIT**Current
                      liabilities:Accounts
                      payable and accrued expenses
                  
                  $
                  1,615,614Factoring
                      payable
                  
                  
                  136,722Payroll
                      and payroll taxes payable
                  
                  
                  88,690Payroll
                      taxes assumed in merger
                  
                  
                  66,529Advances
                      from lenders
                  
                  
                  36,736Loans
                      payable
                  
                  
                  184,388Convertible
                      bonds
                  
                  
                  62,495Convertible
                      debentures
                  
                  
                  210,674Convertible
                      notes
                  
                  
                  45,450Dividend
                      payable
                  
                  
                  44,359Total
                      current liabilities
                  
                  
                  2,491,656Long-term
                      debt
                  
                  
                  1,204,748Stockholders'
                      deficit:Preferred
                      stock, convertible, no par value, 50,000,000 shares
                      authorized,4,154,750
                      shares issued and outstanding
                  
                  
                  1,281,605Common
                      stock, $0.001 par value, 500,000,000 shares authorized,157,877,453
                      shares issued and outstanding
                  
                  
                  157,877Additional
                      paid-in capital
                  
                  
                  32,900,399Shares
                      to be issued
                  
                  
                  30,000Stock
                      subscription receivable
                  
                  
                  (776,250
                  )Accumulated
                      deficit
                  
                  
                  (34,730,715
                  )Total
                      stockholders' deficit
                  
                  
                  (1,137,084
                  )Total
                      liabilities and stockholders' deficit
                  
                  $
                  2,559,321
  The
              accompanying notes are an integral part of these unaudited consolidated
              financial statements
 3
 
 **QUINTEK
                          TECHNOLOGIES, INC. AND SUBSIDIARIES****CONSOLIDATED
                          STATEMENTS OF OPERATIONS****(Unaudited)**
  **For
                          the three months periods ended**
                        **March
                          31,**
                      
                      **For
                          the nine months periods ended March 31,****2007**
                      
                      **2006**
                      
                      **2007**
                      
                      **2006**Net
                          revenue
                      
                      $
                      594,064
                      
                      $
                      499,879
                      
                      $
                      1,403,075
                      
                      $
                      1,728,759Cost
                          of revenue
                      
                      
                      443,347
                      
                      
                      329,525
                      
                      
                      1,090,833
                      
                      
                      1,155,958Gross
                          margin
                      
                      
                      150,717
                      
                      
                      170,354
                      
                      
                      312,242
                      
                      
                      572,801Operating
                          expenses:Selling,
                          general and administrative
                      
                      
                      494,517
                      
                      
                      555,735
                      
                      
                      1,862,816
                      
                      
                      1,759,320Stock-based
                          compensation
                      
                      
                      -
                      
                      
                      802,759
                      
                      
                      600,000
                      
                      
                      1,186,734Stock-based
                          consulting fees
                      
                      
                      -
                      
                      
                      -
                      
                      
                      135,955
                      
                      
                      -Total
                          operating expenses
                      
                      
                      494,517
                      
                      
                      1,358,494
                      
                      
                      2,598,771
                      
                      
                      2,946,054Loss
                          from operations
                      
                      
                      (343,800
                      )
                      
                      (1,188,139
                      )
                      
                      (2,286,529
                      )
                      
                      (2,373,253
                      )Non-operating
                          income (expense):Realized
                          gain (loss) on investment
                      
                      
                      -
                      
                      
                      -
                      
                      
                      (120,040
                      )
                      
                      113,700Other
                          income
                      
                      
                      3,008
                      
                      
                      3,215
                      
                      
                      9,170
                      
                      
                      12,846Uncollectible
                          from former officers
                      
                      
                      (2,708
                      )
                      
                      (3,299
                      )
                      
                      (8,175
                      )
                      
                      (8,325
                      )Beneficial
                          conversion feature
                      
                      
                      (68,425
                      )
                      
                      (13,959
                      )
                      
                      (198,161
                      )
                      
                      (110,924
                      )Change
                          in Fair Value of Warrants
                      
                      
                      818,509
                      
                      
                      -
                      
                      
                      1,522,584
                      
                      
                      -Interest
                          Income
                      
                      
                      90
                      
                      
                      2,413
                      
                      
                      2,818
                      
                      
                      5,080Interest
                          expense
                      
                      
                      (87,281
                      )
                      
                      (140,421
                      )
                      
                      (182,762
                      )
                      
                      (315,457
                      )Total
                          non-operating income (expense)
                      
                      
                      663,194
                      
                      
                      (152,050
                      )
                      
                      1,025,435
                      
                      
                      (303,080
                      )Loss
                          before provision for income taxes
                      
                      
                      319,393
                      
                      
                      (1,340,190
                      )
                      
                      (1,261,093
                      )
                      
                      (2,676,333
                      )Provision
                          for income taxes
                      
                      
                      -
                      
                      
                      -
                      
                      
                      800
                      
                      
                      800Net
                          income/(loss)
                      
                      
                      319,393
                      
                      
                      (1,340,190
                      )
                      
                      (1,261,893
                      )
                      
                      (2,677,133
                      )Dividend
                          requirement for preferred stock
                      
                      
                      3,697
                      
                      
                      4,015
                      
                      
                      11,726
                      
                      
                      12,043Net
                          income (loss) applicable to common shareholders
                      
                      
                      315,696
                      
                      
                      (1,344,205
                      )
                      
                      (1,273,620
                      )
                      
                      (2,689,176
                      )Other
                          comprehensive (loss)/gain:Reclassification
                          adjustment
                      
                      
                      -
                      
                      
                      -
                      
                      
                      120,151
                      
                      
                      (4,080
                      )Unrealized
                          gain for the period
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -
                      
                      
                      9,317Comprehensive
                          gain / (loss)
                      
                      $
                      315,696
                      
                      $
                      (1,344,205
                      )
                      $
                      (1,153,469
                      )
                      $
                      (2,683,939
                      )Basic
                          and diluted net loss per share
                      
                      $
                      0.002
                      
                      $
                      (0.010
                      )
                      $
                      (0.008
                      )
                      $
                      (0.020
                      )Basic
                          and diluted weighted averageshares
                          outstanding
                      
                      
                      154,551,597
                      
                      
                      106,389,263
                      
                      
                      152,466,020
                      
                      
                      118,289,124
  The
                  accompanying notes are an integral part of these unaudited consolidated
                  financial statements
 4
 
 **QUINTEK
                              TECHNOLOGIES, INC. AND SUBSIDIARIES****CONSOLIDATED
                              STATEMENT OF CASH FLOWS****(Unaudited)**
  **Nine
                              months periods ended****March
                              31,****2007**
                          
                          
                          **2006****OPERATING
                              ACTIVITIES**Net
                              loss
                          
                          $
                          (1,261,893
                          )
                          $
                          (2,677,133
                          )Adjustments
                              to reconcile net loss to net cash used in operations:Depreciation
                              and amortization
                          
                          
                          132,882
                          
                          
                          129,365Discount
                              on factor
                          
                          
                          1,521
                          
                          
                          4,796Expenses
                              paid by a note payable
                          
                          
                          -
                          
                          
                          36,478Issuance
                              of shares for consulting services
                          
                          
                          135,955
                          
                          
                          647,404Stock
                              based compensation
                          
                          
                          600,000
                          
                          
                          -Bad
                              Debts
                          
                          
                          6,545
                          
                          
                          -Uncollectible
                              from former officers
                          
                          
                          8,175
                          
                          
                          -Loss
                              on the sale of the investment
                          
                          
                          120,040
                          
                          
                          (113,700
                          )Change
                              in Fair value of Warrants
                          
                          
                          (1,522,584
                          )
                          
                          -Beneficial
                              conversion feature expense
                          
                          
                          198,161
                          
                          
                          110,924Amortization
                              of the Unamortized discount
                          
                          
                          15,278
                          
                          
                          87,635Stock
                              options granted
                          
                          
                          
                          
                          
                          539,330Warrants
                              granted to consultant
                          
                          
                          
                          
                          
                          250,343Changes
                              in current assets and liabilities:(Increase)
                              decrease in accounts receivable
                          
                          
                          (134,927
                          )
                          
                          18,783(Increase)
                              decrease in other current assets
                          
                          
                          (9,235
                          )
                          
                          643(Increase)
                              decrease in prepaid expenses
                          
                          
                          -
                          
                          
                          5,023Increase
                              in accounts payable
                          
                          
                          624,877
                          
                          
                          159,937Increase
                              (decrease) in payroll taxes payable
                          
                          
                          (123,007
                          )
                          
                          191,814Decrease
                              in deferred revenue
                          
                          
                          (8,421
                          )
                          
                          (11,656
                          )Net
                            cash used in operating activities
                          
                          
                          (1,218,156
                          )
                          
                          (620,015
                          )**INVESTING
                            ACTIVITIES**Acquisition
                              of equipment
                          
                          
                          (27,299
                          )
                          
                          (32,240
                          )Increase
                              in restricted cash
                          
                          
                          -
                          
                          
                          (5,080
                          )Proceeds
                              from sale of marketable securities
                          
                          
                          10,821
                          
                          
                          238,018Net
                              cash provided by/ (used in) investing activities
                          
                          
                          (16,478
                          )
                          
                          200,699**FINANCING
                            ACTIVITIES**Payments
                              on factoring payable
                          
                          
                          -
                          
                          
                          (266,694
                          )Proceeds
                              from factor
                          
                          
                          -
                          
                          
                          262,684Payments
                              on leases
                          
                          
                          (112,816
                          )
                          
                          (61,735
                          )Proceeds
                              from issuance of debentures
                          
                          
                          1,250,000
                          
                          
                          -Expenses
                              related to Issuance of Debenture
                          
                          
                          (125,000
                          )
                          
                          -Proceeds
                              from sale of stocks
                          
                          
                          2,502
                          
                          
                          265,000Prepayments
                              for exercise of warrants to be issued for note conversion
                          
                          
                          -
                          
                          
                          175,000Proceeds
                              from issuance of common stock upon exercise of warrants
                          
                          
                          -
                          
                          
                          59,400Payments
                              of notes payable
                          
                          
                          (67,640
                          )
                          
                          (10,150
                          )Net
                            cash provided by financing activities
                          
                          
                          947,046
                          
                          
                          423,505**Net
                            increase (decrease) in cash and cash equivalents**
                          
                          
                          (287,588
                          )
                          
                          4,189**Cash
                            and cash equivalents, beginning balance**
                          
                          
                          410,007
                          
                          
                          12,669**Cash
                            and cash equivalents, ending balance**
                          
                          $
                          122,419
                          
                          $
                          16,858
  The
                      accompanying notes are an integral part of these unaudited
                      consolidated
                      financial statements
 5
 
 **QUINTEK
                        TECHNOLOGIES, INC.**
 **NOTES
                        TO THE FINANCIAL STATEMENTS**
 (Unaudited)





**1.
      DESCRIPTION OF BUSINESS**





The
      Company was originally incorporated under the laws of the State of California
      on
      April 16, 1993, as Quintek Electronics, Inc. On January 14, 1999, the Company
      merged with Pacific Diagnostic Technologies, Inc. in a business combination
      accounted for as a purchase. The acquisition took place under a plan of
      reorganization. Quintek Electronics, Inc. ("QEI") became public when it was
      acquired by Pacific Diagnostic Technologies, Inc. ("PDX") through a reverse
      merger and Chapter 11 Plan of Reorganization. Under the plan, all assets of
      QEI
      were sold to PDX, all PDX management resigned once the Plan was confirmed,
      and
      QEI's management and operating plan were adopted by the new operating entity.
      Shortly after the confirmation of the plan, the name of the reorganized debtor
      was changed to Quintek Technologies, Inc. ("QTI"). QTI assumed the assets,
      liabilities, technology and public position of both QEI and PDX.





On
      February 24, 2000, the Company acquired all of the outstanding common stock
      of
      Juniper Acquisition Corporation ("Juniper"). For accounting purposes, the
      acquisition was treated as a capitalization of the Company with the Company
      as
      the acquirer (reverse acquisition).





On
      May 5,
      2005, the Company formed Sapphire Consulting Services to focus its efforts
      on
      the Supply Chain Services market. Sapphire provides back office services and
      solutions to improve efficiencies within organizations. The Company accomplishes
      this through out-sourcing/in-sourcing services, consulting services and solution
      sales.





Quintek
      provides business process outsourcing services to Fortune 500, Russell 2000
      companies and public sector organizations. The Company’s business process
      includes outsourcing services range from consulting, digitizing, indexing,
      and
      uploading of source documents through simple customer-specific, rules-based
      decision making. .





**2.
      BASIS OF PRESENTATION**





The
      accompanying unaudited financial statements of Quintek have been prepared in
      accordance with the rules and regulations of the Securities and Exchange
      Commission for the presentation of interim financial information, but do not
      include all the information and footnotes required by generally accepted
      accounting principles for complete financial statements. In the opinion of
      management, the accompanying unaudited financial statements of the Company
      include all adjustments (consisting only of normal recurring adjustments)
      considered necessary to present fairly its financial position as of March 31,
      2007, the results of operations for the nine months ended March 31, 2007 and
      2006, and cash flows for the nine months ended March 31, 2007 and 2006. The
      operating results for the nine month period ended March 31, 2007 are not
      necessarily indicative of the results that may be expected for the year ending
      June 30, 2007. The audited financial statements for the year ended June 30,
      2006
      were filed on September 28, 2006 with the Securities and Exchange Commission
      and
      is hereby referenced. The information included in this Form 10-QSB should be
      read in conjunction with Management's Discussion and Analysis and financial
      statements and notes thereto included in the Company's 2006 Form 10-KSB.





**Use
      of 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 revenues and expenses during the reporting period.
      Actual results could differ from those estimates.





**Cash
      and Cash Equivalents**





The
      Company considers all liquid investments with a maturity of three months or
      less
      from the date of the purchase that are readily convertible into cash to be
      cash
      equivalents.





**Accounts
      Receivable**





The
      Company maintains reserves for potential credit losses on accounts receivable.
      Management reviews the composition of accounts receivable and analyzes
      historical bad debts, customer concentrations, customer credit worthiness,
      current economic trends and changes in customer payment patterns to evaluate
      the
      adequacy of these reserves. Reserves are recorded primarily on a specific
      identification basis. Allowance for doubtful debts amounted to $4,496 as at
      March 31, 2007.





**Property
      & Equipment**





Property
      and equipment are stated at cost. Expenditures for maintenance and repairs
      are
      charged to earnings as incurred; additions, renewals and betterments are
      capitalized. When property and equipment are retired or otherwise disposed
      of,
      the related cost and accumulated depreciation are removed from the respective
      accounts, and any gain or loss is included in operations. Depreciation of
      property and equipment is provided using the straight-line over the estimated
      useful lives (3-7 years) of the assets.




6
 
 **QUINTEK
          TECHNOLOGIES, INC.**
 **NOTES
          TO THE FINANCIAL STATEMENTS**
 (Unaudited)





**Long-lived
      Assets**





Effective
      January 1, 2002, the Company adopted Statement of Financial Accounting Standards
      No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets" ("SFAS
      144"), which addresses financial accounting and reporting for the impairment
      or
      disposal of long-lived assets and supersedes SFAS No. 121, "Accounting for
      the
      Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of,"
      and the accounting and reporting provisions of APB Opinion No. 30, "Reporting
      the Results of Operations for a Disposal of a Segment of a Business." The
      Company periodically evaluates the carrying value of long-lived assets to be
      held and used in accordance with SFAS 144. SFAS 144 requires impairment losses
      to be recorded on long-lived assets used in operations when indicators of
      impairment are present and the undiscounted cash flows estimated to be generated
      by those assets are less than the assets' carrying amounts. In that event,
      a
      loss is recognized based on the amount by which the carrying amount exceeds
      the
      fair market value of the long-lived assets. Loss on long-lived assets to be
      disposed of is determined in a similar manner, except that fair market values
      are reduced for the cost of disposal.





**Accounts
      Payable & Accrued Expenses**





Accounts
      payable and accrued expenses consist of the following as of March 31,
      2007:


Accounts
                  payable
              
              $
              535,111Accrued
                  interest
              
              
              471,666Accrued
                  legal fees
              
              
              33,250Accrued
                  Litigation Liability
              
              
              457,282Other
                  accrued expenses
              
              
              118,305$
              1,615,614





**Income
      Taxes**





Deferred
      taxes are provided for on a liability method for temporary differences between
      the financial reporting and tax basis of assets and liabilities that will result
      in taxable or deductible amounts in the future. Deferred tax assets and
      liabilities are adjusted for the effects of changes in tax laws and rates on
      the
      date of enactment. Deferred tax assets are reduced by a valuation allowance
      when, in the opinion of management, it is more likely than not that some portion
      or all of the deferred tax assets will be realized.





**Marketable
      securities and realized loss due to decline in market
      value**





On
      July
      29, 2004, the Company entered into an Agreement with Langley Park Investments
      Plc, a London Investment Company to issue 14,000,000 shares of the Company's
      common stock to Langley in return for 1,145,595 shares of Langley. Fifty percent
      of Langley shares, or 572,798 shares, issued to the Company under this agreement
      were to be held in escrow for two years. At the end of two years if the market
      price for the Company's common stock was at or greater than the Initial Closing
      Price, the escrow agent would release the full amount of shares. In the event
      that the market price for the Company's common stock is less than the Initial
      Closing Price the amount released would be adjusted.





Langley
      attained listing with the United Kingdom Listing Authority. The Company's shares
      are to be held by Langley for a period of at least two years. Langley shares
      issued to the Company are to be free trading.





The
      Company's marketable securities (Langley's shares) were classified as
      available-for-sale and, as such, were carried at fair value. Securities
      classified as available-for-sale may be sold in response to changes in interest
      rates, liquidity needs, and for other purposes. The investment in marketable
      securities represents less than twenty percent (20%) of the outstanding common
      stock and stock equivalents of the investee. As such, the investment is
      accounted for in accordance with the provisions of SFAS No. 115.





Unrealized
      holding gains and losses for marketable securities are excluded from earnings
      and reported as a separate component of stockholder's equity. Realized gains
      and
      losses for securities classified as available-for-sale are reported in earnings
      based upon the adjusted cost of the specific security sold. On October 7, 2006,
      the Langley Escrow shares held as Protection Shares (as defined in the Escrow
      Agreement) were repurchased by Langley from the Company these were limited
      to
      the number of Langley escrow shares held or 572,798 shares. The purchase price
      was calculated as follows: the number of Langley Consideration Shares multiplied
      by the Percentage Decrease. The Percentage Decrease equals Market Value/the
      Closing Price. “Market Value” shall be the average of the ten (10) closing bid
      prices per share of the Company common stock during the ten (10) trading days
      immediately preceding the two year anniversary of the closing. “Closing Price”
shall be the closing bid price of the Company’s common stock on the day of
      closing. The Company received funds totaling $10,821 pursuant to the repurchase
      of these shares and realized a loss totaling $120,040 in the accompanying
      financial statements as of March 31, 2007.




7
 
  **QUINTEK
          TECHNOLOGIES, INC.**
 **NOTES
          TO THE FINANCIAL STATEMENTS**
 (Unaudited)







**Stock-based
      compensation**





The
      Company adopted SFAS No. 123 (Revised 2004), *Share
      Based Payment* (“SFAS
      No. 123R”), under the modified-prospective transition method on
      January 1, 2006. SFAS No. 123R requires companies to measure and
      recognize the cost of employee services received in exchange for an award of
      equity instruments based on the grant-date fair value. Share-based compensation
      recognized under the modified-prospective transition method of SFAS
      No. 123R includes share-based compensation based on the grant-date fair
      value determined in accordance with the original provisions of SFAS
      No. 123, *Accounting
      for Stock-Based Compensation,* for
      all
      share-based payments granted prior to and not yet vested as of January 1,
      2006 and share-based compensation based on the grant-date fair-value determined
      in accordance with SFAS No. 123R for all share-based payments granted after
      January 1, 2006. SFAS No. 123R eliminates the ability to account for
      the award of these instruments under the intrinsic value method prescribed
      by
      Accounting Principles Board (“APB”) Opinion No. 25, *Accounting
      for Stock Issued to Employees* ,
      and
      allowed under the original provisions of SFAS No. 123. Prior to the
      adoption of SFAS No. 123R, the Company accounted for our stock option plans
      using the intrinsic value method in accordance with the provisions of APB
      Opinion No. 25 and related interpretations.




There
      were no stock options granted during the nine months ended March 31,
      2007.




**Fair
      Value of Financial Instruments**





Statement
      of financial accounting standard No. 107, Disclosures about fair value of
      financial instruments, requires that the Company disclose estimated fair values
      of financial instruments. The carrying amounts reported in the statements of
      financial position for assets and liabilities qualifying as financial
      instruments are a reasonable estimate of fair value.





**Basic
      and diluted net loss per share**





Net
      loss
      per share is calculated in accordance with the Statement of financial accounting
      standards No. 128 (SFAS No. 128), "Earnings per share". SFAS No. 128 superseded
      Accounting Principles Board Opinion No.15 (APB 15). Net loss per share for
      all
      periods presented has been restated to reflect the adoption of SFAS No. 128.
      Basic net loss per share is based upon the weighted average number of common
      shares outstanding. Diluted net loss per share is based on the assumption that
      all dilutive convertible shares and stock options were converted or exercised.
      Dilution is computed by applying the treasury stock method. Under this method,
      options and warrants are assumed to be exercised at the beginning of the period
      (or at the time of issuance, if later), and as if funds obtained thereby were
      used to purchase common stock at the average market price during the period.
      Weighted average number of shares used to compute basic and diluted loss per
      share for the nine month period ended March 31, 2007 and 2006 are the same
      since
      the effect of dilutive securities is anti-dilutive.





**Revenue
      Recognition**





Revenue
      is recognized when earned. The Company recognizes its revenue in accordance
      with
      the Securities and Exchange Commissions (“SEC”) Staff Accounting Bulletin No.
      104, “Revenue Recognition in Financial Statements” (“SAB 104”) and The American
      Institute of Certified Public Accountants (“AICPA”) Statement of Position
      (“SOP”) 97-2, “Software Revenue Recognition,” as amended as amended by SOP 98-4
      and SOP 98-9.





**Issuance
      of shares for service**





The
      Company accounts for the issuance of equity instruments to acquire goods and
      services based on the fair value of the goods and services or the fair value
      of
      the equity instrument at the time of issuance, whichever is more reliably
      measurable.





**Derivative
      Instruments**





In
      June
      1998, the Financial Accounting Standards Board issued SFAS No. 133, “Accounting
      for Derivative Instruments and Hedging Activities.” SFAS No. 133, as amended by
      SFAS No. 137, is effective for fiscal years beginning after June 15, 2000.
      SFAS
      No. 133 requires the Company to recognize all derivatives as either assets
      or
      liabilities and measure those instruments at fair value. It further provides
      criteria for derivative instruments to be designated as fair value, cash flow
      and foreign currency hedges and establishes respective accounting standards
      for
      reporting changes in the fair value of the derivative instruments. After
      adoption, the Company is required to adjust hedging instruments to fair value
      in
      the balance sheet and recognize the offsetting gains or losses as adjustments
      to
      be reported in net income or other comprehensive income, as appropriate. The
      derivative asset on issuance of convertible debenture as of March 31, 2007
      was
      $1,627,407.




8
 
  **QUINTEK
          TECHNOLOGIES, INC.**
 **NOTES
          TO THE FINANCIAL STATEMENTS**
 (Unaudited)


**Reporting
      segments**





Statement
      of financial accounting standards No. 131, Disclosures about segments of an
      enterprise and related information (SFAS No. 131), which superseded statement
      of
      financial accounting standards No. 14, Financial reporting for segments of
      a
      business enterprise, establishes standards for the way that public enterprises
      report information about operating segments in annual financial statements
      and
      requires reporting of selected information about operating segments in interim
      financial statements regarding products and services, geographic areas and
      major
      customers. SFAS No. 131 defines operating segments as components of an
      enterprise about which separate financial information is available that is
      evaluated regularly by the chief operating decision maker in deciding how to
      allocate resources and in assessing performances. Currently, SFAS 131 has no
      effect on the Company's financial statements as substantially all of the
      Company's operations are conducted in one industry segment.





**Reclassifications**




Certain
      comparative amounts have been reclassified to conform to the current period
      presentation.





**Recent
      Pronouncements**





In
      February 2006, FASB issued SFAS No. 155, “Accounting for Certain Hybrid
      Financial Instruments”. SFAS No. 155 amends SFAS No 133, “Accounting for
      Derivative Instruments and Hedging Activities”, and SFAF No. 140, “Accounting
      for Transfers and Servicing of Financial Assets and Extinguishments of
      Liabilities”. SFAS No. 155, permits fair value remeasurement for any hybrid
      financial instrument that contains an embedded derivative that otherwise would
      require bifurcation, clarifies which interest-only strips and principal-only
      strips are not subject to the requirements of SFAS No. 133, establishes a
      requirement to evaluate interest in securitized financial assets to identify
      interests that are freestanding derivatives or that are hybrid financial
      instruments that contain an embedded derivative requiring bifurcation, clarifies
      that concentrations of credit risk in the form of subordination are not embedded
      derivatives, and amends SFAS No. 140 to eliminate the prohibition on the
      qualifying special-purpose entity from holding a derivative financial instrument
      that pertains to a beneficial interest other than another derivative financial
      instrument. This statement is effective for all financial instruments acquired
      or issued after the beginning of the Company’s first fiscal year that begins
      after September 15, 2006. Management believes that this statement will not
      have
      a significant impact on the financial statements.





In
      March
      2006 FASB issued SFAS 156 ‘Accounting for Servicing of Financial Assets’ this
      Statement amends FASB Statement No. 140, *Accounting
      for Transfers and Servicing of Financial Assets and Extinguishments of
      Liabilities,* with
      respect to the accounting for separately recognized servicing assets and
      servicing liabilities. This Statement:




1.
            Requires
                an entity to recognize a servicing asset or servicing liability each
                time
                it undertakes an obligation to service a financial asset by entering
                into
                a servicing contract.




2.
            Requires
                all separately recognized servicing assets and servicing liabilities
                to be
                initially measured at fair value, if practicable.




3.
            Permits
                an entity to choose ‘Amortization method’ or  Fair value measurement
                method’ for each class of separately recognized servicing assets and
                servicing liabilities:




4.
            At
                its initial adoption, permits a one-time reclassification of
                available-for-sale securities to trading securities by entities with
                recognized servicing rights, without calling into question the treatment
                of other available-for-sale securities under Statement 115, provided
                that
                the available-for-sale securities are identified in some manner as
                offsetting the entity’s exposure to changes in fair value of servicing
                assets or servicing liabilities that a servicer elects to subsequently
                measure at fair value.




5.
            Requires
                separate presentation of servicing assets and servicing liabilities
                subsequently measured at fair value in the statement of financial
                position
                and additional disclosures for all separately recognized servicing
                assets
                and servicing liabilities.




This
      Statement is effective as of the beginning of the Company’s first fiscal year
      that begins after September 15, 2006. Management believes that this statement
      will not have a significant impact on the financial statements





In
      September 2006, the FASB issued SFAS No. 157, “Fair Value
      Measurements.” This statement clarifies the definition of fair value,
      establishes a framework for measuring fair value and expands the disclosures
      on
      fair value measurements. SFAS No. 157 is effective for fiscal years
      beginning after November 15, 2007. Management has not determined the
      effect, if any, the adoption of this statement will have on the financial
      statements.




9
 
  **QUINTEK
          TECHNOLOGIES, INC.**
 **NOTES
          TO THE FINANCIAL STATEMENTS**
 (Unaudited)





In
      September 2006, FASB issued SFAS 158 ‘Employers’ Accounting for Defined Benefit
      Pension and Other Postretirement Plans—an amendment of FASB Statements No. 87,
      88, 106, and 132(R)’ This Statement improves financial reporting by requiring an
      employer to recognize the over-funded or under-funded status of a defined
      benefit postretirement plan (other than a multiemployer plan) as an asset or
      liability in its statement of financial position and to recognize changes in
      that funded status in the year in which the changes occur through comprehensive
      income of a business entity or changes in unrestricted net assets of a
      not-for-profit organization. This Statement also improves financial reporting
      by
      requiring an employer to measure the funded status of a plan as of the date
      of
      its year-end statement of financial position, with limited exceptions. An
      employer with publicly traded equity securities is required to initially
      recognize the funded status of a defined benefit postretirement plan and to
      provide the required disclosures as of the end of the fiscal year ending after
      December 15, 2006. An employer without publicly traded equity securities is
      required to recognize the funded status of a defined benefit postretirement
      plan
      and to provide the required disclosures as of the end of the fiscal year ending
      after June 15, 2007. However, an employer without publicly traded equity
      securities is required to disclose the following information in the notes to
      financial statements for a fiscal year ending after December 15, 2006, but
      before June 16, 2007, unless it has applied the recognition provisions of this
      Statement in preparing those financial statements:





1.
            A
                brief description of the provisions of this Statement


2.
            The
                date that adoption is required


3.
            The
                date the employer plans to adopt the recognition provisions of this
                Statement, if earlier.





The
      requirement to measure plan assets and benefit obligations as of the date of
      the
      employer’s fiscal year-end statement of financial position is effective for
      fiscal years ending after December 15, 2008.





In
      February of 2007 the FASB issued SFAS 159, “The Fair Value Option for Financial
      Assets and Financial Liabilities—Including an amendment of FASB Statement No.
      115.” The statement permits entities to choose to measure many financial
      instruments and certain other items at fair value. The objective is to improve
      financial reporting by providing entities with the opportunity to mitigate
      volatility in reported earnings caused by measuring related assets and
      liabilities differently without having to apply complex hedge accounting
      provisions. The statement is effective as of the beginning of an entity’s first
      fiscal year that begins after November 15, 2007.





The
      management is currently evaluating the effect of this pronouncement on financial
      statements.





**3.**  **PRINCIPLES
      OF CONSOLIDATION**





The
      accompanying consolidated financial statements for the three months and nine
      months ended March 31, 2007 and 2006 included the accounts of Quintek
      Technologies, Inc. and its wholly owned subsidiary Sapphire Consulting Services.
      All significant inter-company accounts and transactions have been eliminated
      in
      consolidation.





**4.
      PROPERTY AND EQUIPMENT**





Property
      and equipment at March 31, 2007, consists of the following:


Computer
                  and office equipment
              
              $
              844,457Other
                  depreciable assets
              
              
              102,881Furniture
                  and fixture
              
              
              40,653987,991Accumulated
                  depreciation
              
              
              (645,377
              )$
              342,614





The
      depreciation expense was $132,882 and $129,365 for the nine month periods ended
      March 31, 2007 & 2006 respectively.




**5.
      EMPLOYEE RECEIVABLES**





Employee
      receivables comprised of following at March 31, 2007:


Notes
                  receivable from employees, unsecured,due
                  on June 30, 2019, interest at 4% per annum
              
              $
              259,954Notes
                  receivable from employees, unsecured,due
                  on April 7, 2007
              
              
              560


Interest
                  receivable in connection with the aboveemployee
                  receivables
              
              
              47,667308,181Valuation
                  allowance
              
              
              (307,621
              )$
              560
  10
 
  **QUINTEK
            TECHNOLOGIES, INC.**
 **NOTES
            TO THE FINANCIAL STATEMENTS**
 (Unaudited)





Employee
      receivables has been reflected as a part of “Other current assets” in the
      accompanying financial statements.





**6.
      OTHER ASSETS**





Other
      assets comprised of following at March 31, 2007:


Subscription
                  Receivable
              
              $
              58,349**A**llowance
                  on Subscription Receivable
              
              
              (57,466
              )$
              883





**7.
      NOTE PAYABLE**




On
      April
      10, 2006, the Company executed a note payable to a third party for $62,590.
      The
      term of the note was for a period of six months bearing an annual interest
      at
      11.5%. The note carries a repayment provision wherein the Company will repay
      the
      third party from proceeds in the event of funding capital totaling a cumulative
      amount of one million dollars is received. The principal on the note was paid
      in
      full as of December 31, 2006. The interest accrual of $3,865 is recorded as
      an
      accrued expense in the accompanying financial statements as of March 31,
      2007.





**8.
      FACTORING PAYABLE**





The
      Company entered into an agreement with a factoring company ("the Factor") to
      factor purchase orders with recourse. The Factor funded 97% or 90% based upon
      the status of the purchase order. The Factor agreed to purchase up to $4,800,000
      of qualified purchase orders over the term of the agreement; however, the Factor
      did not have to purchase more than $200,000 in any given month. The term of
      the
      agreement term was from June 2, 2003 to June 2, 2005. The Company agreed to
      pay
      a late fee of 3% for payments not made within 30 days and 5% for those not
      made
      in 60 days. At the option of the Factor, the late fees may be paid with Company
      stock. If paid by Company stock, the stock bid price would be discounted 50%
      in
      computing the shares to be issued in payment of the late fee.





Pursuant
      to the terms of the factor agreement, the Factor is entitled to receive two
      (2)
      bonus warrants for each dollar of purchase orders purchased. The bonus warrants
      will be exercisable at the average closing price of the Company's common stock
      for the 90 days prior to the purchase order transactions they represent or
      a 50%
      discount to the closing price of the Company's stock at the time exercised
      at
      the option of the Factor. The warrants are exercisable over a five year period.
      The Company has not issued any bonus warrants during the nine months ending
      March 31, 2007.





There
      were no purchases of purchase orders for this factor during the nine months
      ended March 31, 2007. At March 31, 2007, the Company had a factoring payable
      balance of $116,722 associated with this factor. The Company has accrued
      $159,869 interest for late payments of this factor payable as of March 31,
      2007.





At
      March
      31, 2006, the Company had a factoring balance associated with two individual
      factors totaling $20,000. The
      Company has accrued $13,598 for interest of these factoring payables as of
      March
      31, 2007.





**9.
      PAYROLL TAXES-ASSUMED IN MERGER**





The
      Company assumed $205,618 of payroll tax liabilities in the merger with Pacific
      Diagnostic Technologies, Inc. The balance was $66,529 at March 31, 2007. The
      Company is delinquent on payments of these payroll tax liabilities.




11
 
  **QUINTEK
          TECHNOLOGIES, INC.**
 **NOTES
          TO THE FINANCIAL STATEMENTS**
 (Unaudited)






**10.**  **LOANS
      PAYABLE**





A.
      Loan
      Payable as of March 31, 2007, consists of the following:


Capital
                  Leases payable, interest at 7.9% to 20%,
              
              $
              173,479due
                  various dates in 2005 to 2008 (Refer to Note 10(B) below)Lease
                  payable due in 2002
              
              
              2,028Lease
                  payable, interest at 17.8%, due in 2007
              
              
              5,217Note
                  payable, interest at 5.75%, due July 30, 2006
              
              
              6,080(the
                  company is in default and default interest is 12%)Notes
                  payable, interest at 8%, due 2006
              
              
              27,061(the
                  company is in default of these notes)213,865Less:
                  Current Portion
              
              
              184,388Long-term
                  debt
              
              $
              29,477Principal
                  payments on these leases payable are as follows:
  Year
                  ending June 30,2007
              
              $
              74,6512008
              
              
              139,214$
              213,865





B.
      Capital Lease Obligations:





The
      Company leases various equipments under capital leases expiring in various
      years
      through 2008. The assets and liabilities under capital leases are recorded
      at
      the lower of the present value of the minimum lease payments or the fair value
      of the asset. The assets are depreciated over the lesser of their related lease
      terms or their estimated productive lives and are secured by the assets
      themselves. Depreciation of assets under capital leases is included in
      depreciation expense for the nine months ended March 31, 2007 and
      2006.





Aggregate
      minimum future lease payments under capital leases as of March 31, 2007 for
      each
      of the next five years are as follows: (2007: $151,247; and 2008: $29,477;
      and
      thereafter: none.)





Capital
      lease obligations represent the following at March 31, 2007:





2007Total
                minimum lease payments
            
            $
            225,163Interest
                expense relating to future periods
            
            
            (51,684
            )Present
                value of the minimum lease payments
            
            
            173,479Less:
                current portion
            
            
            (144,002
            )Non-current
                portion
            
            $
            29,477





Following
      is a summary of fixed assets held under capital leases at March 31,
      2007





2007Computers
                and production equipment
            
            $
            381,843Less:
                accumulated depreciation
            
            
            (200,026
            )Net
            
            $
            181,817





**11.
      ADVANCES FROM LENDER**





On
      August
      2, 2004 the Company signed a convertible debenture agreement with an accredited
      investor whereby the Company has received an advance totaling $905,000 for
      prepayment of warrants to be exercised as of March 31, 2007. The agreement
      expired on August 2, 2006. The accredited investor has exercised 868,264
      warrants into common shares valued at $868,264 as of the twelve month period
      ended June 30, 2006. The remaining balance of $36,736 is recorded as advances
      from lender in the accompanying financial statements as of March 31, 2007.




12
 
  **QUINTEK
            TECHNOLOGIES, INC.**
 **NOTES
            TO THE FINANCIAL STATEMENTS**
 (Unaudited)




**12.
      CONVERTIBLE BONDS**





Convertible
      bonds at March 31, 2007, consist of the following:


Convertible
                  bonds at March 31, 2007, consist of the following:Bonds
                  payable with interest at 9%, due on October
                  2001convertibleto
                  shares of common stock in increments of $1,000 or more
              
              $
              21,354Bonds
                  payable with interest at 12%, due July 2001, convertible to
                  sharesof
                  common stock in increments of $500 or more.
              
              
              41,141$
              62,495




The
      above
      convertible bonds have matured as of July 2001 and October 2001. The holders
      of
      the matured bonds do not wish to renew the bonds and have asked for payment;
      however, the Company does not have the cash to repay these bonds. The Company
      has recorded the $62,495 as convertible bonds as a current liability in the
      accompanying financial statements as of March 31, 2007.





**13.
      CONVERTIBLE DEBENTURES**





The
      Company raised $300,000 through the issuance of convertible debentures in June
      of 2004. The term of the convertible debentures are as follows: pursuant to
      the
      terms of conversion, debenture in the amount of $300,000 pays interest at 5
3⁄4%
      and includes 3,000,000 warrants to purchase common stock for a period of three
      years at the exercise price of $1.00. The “Conversion Price shall be equal to
      the lesser of (i) $0.50, or (ii) 75% of the average of the 5 lowest Volume
      Weighted Average Prices during the 20 trading days prior to Holder’s election to
      convert, or (iii) 75% of the Volume Weighted Average Price on the trading day
      prior to the Holders election to convert market price of the Company’s common
      stock prior to conversion. Upon conversion of the debenture, the holder is
      obligated to simultaneously exercise the $1.00 warrants providing added funding
      to the Company. The warrant must be exercised concurrently with the conversion
      of this debenture in an amount equal to ten times the dollar amount of the
      Debenture conversion. Upon execution of the securities purchase agreement,
      $225,000 of the purchase price was due and paid to the Company. The remaining
      $75,000 was paid to the Company on February 7, 2005 upon effectiveness of the
      Securities and Exchange Commission’s Registration Statement. As of March 31,
      2007, the Holder of the debenture converted $89,326 of the debenture amount
      into
      14,555,964 common shares of the Company and exercised 893,264
      warrants.





The
      Company allocated the proceeds from the debenture between the warrant and the
      debt based on relative fair value of the warrant and the debt. The value of
      the
      warrant was calculated using the Black-Scholes model using the following
      assumptions: Discount rate of 3.4%, volatility of 100% and expected term of
      one
      year. The amount allocated to the warrant is being amortized over the term
      of
      the debt. The Company calculated a beneficial conversion feature of $279, 652.
      The Company amortized the beneficial conversion feature in accordance with
      the
      conversion terms of the note. At March 31, 2007, the convertible debenture
      of
      $210,674 is presented in the accompanying financial statements with the
      unamortized beneficial conversion feature and unamortized discount fully
      amortized.





On
      May
      17, 2006, the Company entered into a Securities Purchase Agreement with Cornell
      Capital Partners, LP (“Cornell”). The Company entered into a convertible
      debenture with a total commitment value of $2,000,000 of which $750,000 was
      disbursed May 19, 2006, a debenture for $150,000 was entered into on September
      15, 2006, a debenture for $600,000 was entered into on October 18, 2006 and
      a
      final debenture for $500,000 was entered into on February 12, 2007. The term
      for
      each of the convertible debenture is 36 months from the date of each issuance.
      The conversion price in effect on any Conversion Date shall be, at the sole
      option of the Holder, equal to either (a) $0.0662 (the “Fixed Conversion Price”)
      or (b) ninety five percent (95%) of the lowest Volume Weighted Average
      Price of the Common Stock during the thirty (30) trading days immediately
      preceding the Conversion Date as quoted by Bloomberg, LP (the “Market Conversion
      Price”). The Investor shall not be able to convert the debentures into an amount
      that would result in the Investor beneficially owning in excess of 4.99% of
      the
      outstanding shares of common stock of the Company. Pursuant to the terms of
      debenture, the debenture bears interest at 10% interest per year and includes
      17,857,000 warrants to purchase common stock at an exercise price of $0.07
      re-priced at $0.05, 15,625,000 warrants to purchase common stock at an exercise
      price of $0.08 re-priced at $0.055, 12,500,000 warrants to purchase common
      stock
      at an exercise price of $0.10 re-priced at $0.065, and 10,415,000 warrants
      to
      purchase common stock at an exercise price of $0.12 re-priced at $0.08, all
      warrants are for a term of five years. The exercise of the attached warrants
      is
      at the sole option of the Holder. Upon execution of the securities purchase
      agreement, $750,000 of the purchase price was due and paid to the Company on
      May
      19, 2006. On September 18, 2006, an additional $150,000 was paid to the Company
      upon the signing of the second debenture. On October 24, 2006 an additional
      $600,000 was disbursed to the Company prior to the filing of the Securities
      and
      Exchange Commission’s Registration Statement and the final $500,000 was
      disbursed on February 16, 2007 upon effectiveness of the Securities and Exchange
      Commission’s Registration Statement. On February 9, 2007, the Holder converted
      $50,000 of the debenture amount into 2,923,977 common shares of the Company.
      On
      March 30, 2007 the Holder converted $25,000 of the debenture amount into
      1,288,660 common shares of the Company. As of March 31, 2007, the convertible
      debenture of $1,175,271, net of unamortized discount and unamortized debt
      raising expense, is presented in the accompanying financial statements. The
      Company has accrued $106,425 for interest of the convertible debenture as of
      March 31, 2007.




13
 
  **QUINTEK
            TECHNOLOGIES, INC.**
 **NOTES
            TO THE FINANCIAL STATEMENTS**
 (Unaudited)








Per
      EITF
      00-19, paragraph 4, these convertible debentures do not meet the definition
      of a
“conventional convertible debt instrument” since the debt is not convertible
      into a fixed number of shares. The debt can be converted into common stock
      at a
      conversions price that is a percentage of the market price; therefore the number
      of shares that could be required to be delivered upon “net-share settlement” is
      essentially indeterminate. Therefore, the convertible debenture is considered
      “non-conventional,” which means that the conversion feature must be bifurcated
      from the debt and shown as a separate derivative liability. This beneficial
      conversion liability has been calculated to be less than $1 as of March 31,
      2007. In addition, since the convertible debenture is convertible into an
      indeterminate number of shares of common stock, it is assumed that the Company
      could never have enough authorized and unissued shares to settle the conversion
      of the warrants into common stock. Therefore, the warrants issued in connection
      with this transaction have been reported as an asset at March 31, 2007 in the
      accompanying balance sheet with a fair value of $1,641,693. The value of the
      warrant was calculated using the Black-Scholes model using the following
      assumptions: Discount rate of 3.93%, volatility of 100% and expected term of
      five year. The fair value of the beneficial conversion feature and the warrant
      liability will be adjusted to fair value each balance sheet date with the change
      being shown as a component of net income.





The
      fair
      value of the beneficial conversion feature and the warrants at the inception
      of
      these convertible debentures were $NIL and $1,935,904, respectively. $750,000
      of
      the discounts has been recorded as a discount to the convertible debentures
      which will be amortized over the term of the debentures and the excess of
      $1,185,904 was recorded as financing costs in the year ended June 30, 2006.





Principal
      payments on these convertible debentures are as follows:





Year
                ending June 30,2007
            
            $
            210,6702008
            
            
            -2009
            
            
            675,0002010
            
            
            1,250,000$
            2,135,670





**14.
      CONVERTIBLE NOTE**





The
      Company raised capital through the issuance of a convertible note for $50,500
      issued on May 10, 2006. The note bears interest at the rate of 10% per annum
      compounded annually. All principal and interest was due and payable at the
      earlier of occurrence of Company’s first round of financing (whether debt or
      equity) after May 31, 2006 involving the receipts of at least $200,000 or more,
      or on November 10, 2006. The note holder will receive such number of fully
      paid
      and non assessable common stock as shall equal the outstanding amount of
      principal and interest due under this note being converted, divided by 80%
      of
      the price per share at which the Company next sells the shares of its common
      stock. The note holder has agreed to extend the note pursuant to being paid
      10%
      of the principal and accrued interest through November 10, 2006. On December
      27,
      2006, the 10% principal and accrued interest were forwarded to the note holder.
      The remaining principal balance of the note of $45,450 is recorded in the
      accompanying financial statements as of March 31, 2007. The Company has accrued
      $1,731 interest for this note as of March 31, 2007.




**15.
      STOCKHOLDERS' DEFICIT**





*a.
      Common Stock and Warrants*





The
      Company has increased its authorized common stock from 200 million shares to
      500
      million shares and reduced the par value from $0.01 to $0.001 per share. The
      Company received the acceptance from the State of California, for the reduction
      in the par value of shares, on October 20, 2006. Each share entitles the holder
      to one vote. There are no dividend or liquidation preferences, participation
      rights, call prices or rates, sinking fund requirements, or unusual voting
      rights associated with these shares.





During
      the nine month period ended March 31, 2007, the Company issued 2,000,000 common
      shares upon exercise of warrants from a prior period; 2,503,703 common shares
      upon cashless exercise of warrants by the officers of the Company in the current
      period; 750,000 common shares to consultants for services valued at $22,500;
      1,529,169 common shares pursuant to conversion of note from a prior period;
      2,923,977 common shares pursuant to debenture conversion of
      $50,000.




14
 
  **QUINTEK
            TECHNOLOGIES, INC.**
 **NOTES
            TO THE FINANCIAL STATEMENTS**
 (Unaudited)




*b.*  *Outstanding
      Warrants:*




Weighted
            
            AggregateNumber
                of
            
            Average
            
            IntrinsicWarrants
            
            Exercise
                Price
            
            ValueOutstanding
                June 30, 2006
            
            
            80,110,137
            
            $
            0.0906
            
            $
            73,383Issued
                during the period
            
            
            ---
            
            
            ---Expired
            
            
            (442,857
            )
            $
            0.1684Exercised
            
            
            ---
            
            
            ---Outstanding
                March 31, 2007
            
            
            79,667,280
            
            $
            0.0901
            
            $
            ---Warrants
                to be issued
            
            
            4,639,842Total
            
            
            84,307,122





Following
      is a summary of the status of warrants outstanding at March 31, 2007:





Range
                of Exercise Prices
            
            Total
                Warrants Outstanding
            
            Weighted
                Average Remaining Life (Years)
            
            Total
                Weighted Average Exercise Price
            
            Warrants
                Exercisable
            
            Weighted
                Average Exercise Price of Exercisable Warrants$0.01
                - $0.09
            
            
            70,352,142
            
            
            3.45
            
            
            0.051
            
            
            70,352,142
            
            
            0.051$0.10
                - $0.20
            
            
            7,208,402
            
            
            0.13
            
            
            0.013
            
            
            7,208,402
            
            
            0.013$0.21
                - $1.00
            
            
            2,106,736
            
            
            0.01
            
            
            0.026
            
            
            2,106,736
            
            
            0.02679,667,280
            
            
            3.59
            
            
            0.090
            
            
            79,667,280
            
            
            0.090







*c.* *Common
          Stock Reserved*





At
      March
      31, 2007, common stock was reserved for the following reasons:





Outstanding
      convertible bonds 151,918 shares





*d.* *Stock
          Option Agreements*





The
      number and weighted average exercise prices of options granted by the Company
      are as follows:


Options
              
              Weighted
              
              AggregateOutstanding
              
              Average
              
              IntrinsicExercise
              
              ValuePriceOutstanding
                  June 30, 2006
              
              
              16,303,943
              
              $
              0.045
              
              $
              -----Granted
                  during the year
              
              
              -Exercised
              
              
              6,259,255Expired/forfeited
              
              
              200,000Outstanding
                  March 31, 2007
              
              
              9,844,688
              
              $
              0.054
              
              $
              -----




Following
      is a summary of the status of options outstanding at March 31, 2007:





Range
                of Exercise Prices
            
            Total
                Options Outstanding
            
            Weighted
                Average Remaining Life (Years)
            
            Total
                Weighted Average Exercise Price
            
            Options
                Exercisable
            
            Weighted
                Average Exercise Price$0.01
                - $0.09
            
            
            6,741,626
            
            
            2.32
            
            
            0.021
            
            
            6,741,626
            
            
            0.021$0.10
                - $0.20
            
            
            3,103,062
            
            
            0.55
            
            
            0.033
            
            
            3,103,062
            
            
            0.0339,844,688
            
            
            2.87
            
            
            0.054
            
            
            9,844,688
            
            
            0.054




15
 
  **QUINTEK
          TECHNOLOGIES, INC.**
 **NOTES
          TO THE FINANCIAL STATEMENTS**
 (Unaudited)








2,180,000
      three year options calculated using the Black Scholes option pricing model
      using
      the following assumptions


Risk-free
                  interest rate
              
              
              3.40
              %Dividend
                  yield
              
              
              0
              %Volatility
              
              
              100
              %





7,352,688
      five year options calculated using the Black Scholes option pricing model using
      the following assumptions


Risk-free
                  interest rate
              
              
              3.40
              %Dividend
                  yield
              
              
              0
              %Volatility
              
              
              100
              %




312,000
      three year options calculated using the Black Scholes option pricing model
      using
      the following assumptions


Risk-free
                  interest rate
              
              
              3.93
              %Dividend
                  yield
              
              
              0
              %Volatility
              
              
              100
              %




For
      periods presented prior to the adoption of SFAS No. 123R, pro forma
      information regarding net income and earnings per share as required by SFAS
      No. 123R has been determined as if we had accounted for our employee stock
      options under the original provisions of SFAS No. 123. The fair value of
      these options was estimated using the Black-Scholes option pricing model. There
      were no options granted for the nine months ended March
      31 ,
      2007.





Details
      of the Company’s non-vested options as of March 31, 2007 are as
      follows:





Non-Vested
                Options
            
            Weighted
                Average Exercise Price
            
            Weighted
                Average Vesting Period
            
            GrantDate
                Fair ValueNA





*e.* *Stock
          transactions approved by the shareholders*





At
      the
      Annual Meeting of the shareholders held on September 7, 2006, the shareholders
      approved by a majority vote to increase the authorized share capital to
      500,000,000 shares and reduce the par value from $0.01 to $0.001 per
      share.





**Series
      A Preferred Stock**





The
      general terms of the Series A Preferred Stock is as follows: No par value;
      Liquidation Preference - $0.25 per share plus any unpaid accumulated dividends;
      Dividends - cumulative annual rate of $0.005 per share when and as declared
      by
      the Board of Directors; Conversion Rights - convertible to common stock at
      a 1:1
      ratio ; Redemption Rights - the Company has the right to redeem part or all
      of
      the stock upon 30 days written notice at a rate of $0.25 per share plus all
      accumulated and unpaid dividends thereon at the dividend rate of $0.005 annually
      per share; Voting Rights - one vote per share on all matters requiring
      shareholder vote. At March 31, 2007, the Company had 3,047,531 shares of Series
      A Preferred stock outstanding valued at $526,506. The Company has recorded
      a
      cumulative dividend of $44,119 for the Series A Preferred stockholders as of
      March 31, 2007 in the accompanying financial statements.





**Series
      B Preferred Stock**





The
      general terms of the Series B Preferred Stock is as follows: No par Value;
      Liquidation Preference - $0.25 per share plus any unpaid accumulated dividends;
      Dividends - cumulative annual rate of $0.0005 per share when and as declared
      by
      the Board of Directors; Conversion Rights - convertible to common stock at
      a 1:5
      ratio (i.e. 1 share of Series B Preferred stock is convertible into 5 shares
      of
      common stock); Redemption Rights - the Company has the right to redeem part
      or
      all of the stock upon 30 days written notice at a rate of $0.25 per share plus
      all accumulated and unpaid dividends thereon at the dividend rate of $0.0005
      annually per share; Voting Rights - one vote per share on all matters requiring
      shareholder vote. At March 31, 2007, the Company had 89,271 shares of Series
      B
      Preferred Stock outstanding valued at $86,888. The Company has recorded a
      cumulative dividend of $217 for the Series B Preferred Stockholders as of March
      31, 2007 in the accompanying financial statements.


.


**Series
      C Preferred Stock**





The
      general terms of the Series C Preferred Stock is as follows: No par value;
      Liquidation Preference - $1.00 per share plus any unpaid accumulated dividends;
      Dividends - cumulative annual rate of $0.0005 per share when as declared by
      the
      Board of Directors; Conversion Rights - 1:20 ratio (i.e. 1 share of Preferred
      Series C stock is convertible into 20 shares of common stock); Redemption Rights
      - the Company has the right to redeem part or all of the stock upon 30 days
      written notice at the rate of $1.00 per share plus all accumulated and unpaid
      dividends thereon at the dividend rate of $0.0005 annually per share.; Voting
      Rights - one vote per share on all matters requiring shareholder vote. At March
      31, 2007, the Company had 17,948 shares of Series C Preferred Stock outstanding
      valued at $68,211. The Company has recorded a cumulative dividend of $23 for
      the
      Series C Preferred Stockholders as of March 31, 2007 in the accompanying
      financial statements.




16
 
  **QUINTEK
            TECHNOLOGIES, INC.**
 **NOTES
            TO THE FINANCIAL STATEMENTS**
 (Unaudited)


.


**Series
      D Preferred Stock**





The
      general terms of the Series D Preferred Stock is as follows: No par value;
      Liquidation Preference - $0.10 per share plus any unpaid accumulated dividends;
      Dividends - if declared by the Board of Directors, holders shall be entitled
      to
      receive dividends as if they had converted such preferred stock into common
      stock as of the dividend date; Conversion Rights - 1:20 ratio (i.e. 1 share
      of
      Preferred Series D stock is convertible into 20 shares of common stock) so
      long
      as the closing bid price of our common stock is at least $0.10 on any date
      subsequent to issuance; Redemption Rights - none; Voting Rights - fifty votes
      per share on all matters requiring shareholder vote. At March 31, 2007, the
      Company had 1,000,000 shares of Series D Preferred Stock outstanding valued
      at
      $600,000. The Company has recorded no accumulative dividend for the Series
      D
      Preferred Stockholders as of March 31, 2007 in the accompanying financial
      statements.





The
      Company has recorded a cumulative dividend of $11,726 for the preferred
      stockholders for the nine month period ended March 31, 2007, in the accompanying
      financial statements.





**16.
      SUPPLEMENTAL DISCLOSURE OF CASH FLOWS**





The
      Company prepares its statements of cash flows using the indirect method as
      defined under the Financial Accounting Standard No. 95. The Company paid $800
      for income tax during the nine month period ended March 31, 2007. The Company
      paid $182,762 interest during the nine month period ended March 31, 2007.





The
      cash
      flow statement for the nine months ended March 31, 2007 does not include the
      following non-cash investing and financing activities:


·
            The
                Company issued 2,923,977 common shares for a conversion of $50,000
                of
                convertible debentures.


·
            The
                Company has to issue 1,288,660 common shares for a conversion of
                $25,000
                of convertible debentures. These have been recorded as ‘shares to be
                issued’ as of March 31, 2007.





The
      Company paid $0 for income tax during the nine month period ended March 31,
      2006. The Company paid $35,104 interest during the nine month period ended
      March
      31, 2006.





The
      cash
      flow statement for the nine months ended March 31, 2006 does not include the
      following non-cash investing and financing activities:


·
            The
                Company issued 8,346,682 common shares for a conversion of $40,826
                of
                convertible debentures.


·
            The
                Company issued 5,992,837 common shares for consulting services to
                be
                provided over agreement period, the value of the shares was $669,837
                and
                the unamortized portion of it is
                $327,293.


·
            The
                Company issued 408,264 common shares due to the exercise of warrants
                valued at $408,264 to be offset against the lender
                advance.


·
            The
                Company issued 410,000 common shares for the conversion of $70,400
                of
                preferred stocks.





**17.**  **COMMITMENTS
      AND CONTINGENCIES**





*a)
      Operating Leases*





Effective
      July 1, 2004 the Company relocated their executive offices to Huntington Beach,
      California and entered into a four year lease agreement. The agreement contains
      a base rent escalation clause. The Company leases its Idaho office facility
      under a month-to-month rental agreement at $675 per month. For the nine months
      ended March 31, 2007 rent expense for these operating leases totaled $77,961.





The
      future minimum lease payments under non-cancelable leases are as
      follows:


2007
              
              $
              94,4902008
              
              
              23,728$
              118,218
  17
 
  **QUINTEK
            TECHNOLOGIES, INC.**
 **NOTES
            TO THE FINANCIAL STATEMENTS**
 (Unaudited)


*b)
      Litigation*





The
      Company was served with a summons as a defendant in a case filed on September
      15, 2006 in Superior court of California, County of San Diego. The complaint
      was
      filed by Golden Gate Investors (GGI) for Breach of Contract relating to the
      financing agreements executed between the Company and Golden Gate Investors
      in
      August 2004. GGI is claiming damages in excess of $718,765 in relation to the
      case. The Company has retained counsel to defend itself in this matter and
      has
      filed a counter suit against GGI. The Company has recorded payables totaling
      $718,978 and an accrued legal expense amounting to $441,715 for the nine months
      ended March 31, 2007.





The
      Company was served with a summons as a defendant in a case filed on October
      24,
      2006 in Superior court of California, County of Orange by Single Source Partners
      (SSP) for failure to pay commissions and installment payments. SSP is seeking
      judgment in the amount of $51,206. The Company has retained counsel to defend
      itself in this matter and filed a counter suit seeking damages for
      misrepresentation and commissions paid and not due to SSP. The Company has
      recorded payables and an accrued partnership fee totaling $56,605 in the
      accompanying financial statements.





**18.
      GOING CONCERN**





The
      accompanying financial statements have been prepared in conformity with
      generally accepted accounting principles, which contemplate continuation of
      the
      Company as a going concern. This basis of accounting contemplates the recovery
      of the Company's assets and the satisfaction of its liabilities in the normal
      course of business. Through March 31, 2007, the Company had incurred cumulative
      losses of $34,730,715 including a net loss of $1,261,893 and $2,677,133 for
      the
      nine month periods ended March 31, 2007 and 2006, respectively. In view of
      the
      matters described in the preceding paragraph, recoverability of a major portion
      of the recorded asset amounts shown in the accompanying balance sheet is
      dependent upon continued operations of the Company, which in turn is dependent
      upon the Company's ability to raise additional capital, obtain financing and
      to
      succeed in its future operations. The financial statements do not include any
      adjustments relating to the recoverability and classification of recorded asset
      amounts or amounts and classification of liabilities that might be necessary
      should the Company be unable to continue as a going concern.





Management
      has taken the following steps to revise its operating and financial
      requirements, which it believes are sufficient to provide the Company with
      the
      ability to continue as a going concern. Management devoted considerable effort
      during the period ended March 31, 2007, towards (i) obtaining additional equity
      financing and (ii) evaluation of its distribution and marketing methods.




18


**Item
      2. Management's Discussion and Analysis**





*This
      Management's Discussion and Analysis of Financial Condition and Results of
      Operations includes a number of forward-looking statements that reflect
      Management's current views with respect to future events and financial
      performance. You can identify these statements by forward-looking words such
      as
“may,” “will,” “expect,” “anticipate,” “believe,” “estimate” and “continue,” or
      similar words. Those statements include statements regarding the intent, belief
      or current expectations of us and members of its management team as well as
      the
      assumptions on which such statements are based. Prospective investors are
      cautioned that any such forward-looking statements are not guarantees of future
      performance and involve risk and uncertainties, and that actual results may
      differ materially from those contemplated by such forward-looking
      statements.*





*Readers
      are urged to carefully review and consider the various disclosures made by
      us in
      this report and in our other reports filed with the Securities and Exchange
      Commission. Important factors currently known to Management could cause actual
      results to differ materially from those in forward-looking statements. We
      undertake no obligation to update or revise forward-looking statements to
      reflect changed assumptions, the occurrence of unanticipated events or changes
      in the future operating results over time. We believe that our assumptions
      are
      based upon reasonable data derived from and known about our business and
      operations. No assurances are made that actual results of operations or the
      results of our future activities will not differ materially from its
      assumptions. Factors that could cause differences include, but are not limited
      to, expected market demand for our services, fluctuations in pricing for
      materials, and competition.*





**Overview**




We
      address the growing needs of industry’s desire for timely access to relevant
      information. We do this by designing and providing a service-based solution
      for
      the customer around our core competencies of high speed high volume document
      scanning, inbound mailroom outsourcing, data capture, ASP hosting, workflow
      automation, and consulting services.





We
      charge
      our customers for deliverable services, consultative services and products.
      Products are invoiced upon shipping to our customer. Services are billed upon
      completion of a project or on a monthly basis, whichever is sooner. Many of
      our
      projects are for customers under long-term service agreements.





Deliverable
      services include scanned documents, captured data and hosted images. These
      are
      delivered to the customer in electronic format via electronic transmission
      via
      email or encrypted FTP transfer or physical media such as CD ROMs or Microfilm.
      Consultative services include document preparation, systems integration,
      software configuration, automated workflow design, and maintenance.





In
      the
      opinion of management, the following relationship, trends, events or
      uncertainties are important in understanding our operations and results as
      they
      have had, or can reasonably be expected to have a material effect on the net
      sales and/or income from operations.





·
            Over
                the past decade, businesses have invested considerable capital in
                technology hardware and software. Receiving relevant information
                into
                these systems in a timely manner is becoming more valuable and important
                to companies. We provide services to capture data and images and
                transfer
                them into information systems. Larger organizations are focused on
                enterprise wide systems to shorten turnaround time, lower cost of
                doing
                business and increase management analytics. Smaller organizations
                are
                finding it more difficult to compete unless they adopt similar strategies.
                This is creating increased demand for the services we provide to
                large and
                small organizations alike.





·
            The
                expansion of the internet to a worldwide resource has made workers
                available to process and catalogue information in other countries.
                This
                has made the labor arbitrage of outsourcing of information services
                overseas a growing and attractive business. It is a growing business
                to
                outsource from areas in the world where there is a high cost for
                educated
                labor to areas of the world where there is a lower cost of educated
                labor.
                We provide timely access to relevant information to the overseas
                information worker. A shift in this trend could impact our business




19




·
            Sapphire
                Consulting Service, our wholly owned subsidiary, accounted for 35%
                of our
                revenue and totaled $486,342 for the nine months ending March 31,
                2007.
                Sapphire was formed in May 2005 and had limited operation for the
                12
                months ending June 30, 2005. The loss of key personnel or relationships
                needed to fulfill and obtain new business could adversely impact
                our
                financial results.





·
            Fed-Ex/Kinko’s—We
                are a subcontractor for services to FedEx Kinko’s customers. Revenue from
                our relationship with FedEx Kinko’s totaled $460,907 and represents 33% of
                the total revenue for the nine months ended March 31, 2007. The loss
                of
                this relationship could adversely impact our financial
                results.





·
            Manhattan
                Data, Inc - We entered into a partnership agreement with Manhattan
                Data
                whereas the two companies sell and resell their respective services
                separately and as a combined solution. For the****nine
                months ended March 31, 2007,
                revenue from this relationship totaled $26,656 and represented 2%
                of our
                total revenue.****At
                this time****we
                are seeing increased demand from our customers for the services we
                offer
                through this partnership.
                If this relationship develops as planned this could represent a material
                portion of our revenues.





·
            Increased
                Sales and Marketing -We have been applying funds raises from a recent
                financing with Cornell Capital to increase sales and marketing efforts.
                The result has been an increased awareness of us and our services.
                This
                increased awareness has led to an increasing amount of new proposals
                we
                have submitted for new business. Management believes that we will
                be able
                to convert a portion of these proposals into new business although
                there
                are no assurances that we will be able to obtain contracts with any
                of
                these potential clients. The inability to obtain new business could
                adversely impact our financial
                results.





·
            We
                had a master services agreement to deliver on-site mortgage processing
                services for GMAC Residential Mortgage at their Ditech.com facility
                in
                Costa Mesa, CA. We are no longer providing services to this customer.
                The
                loss of this customer represents a material loss and will adversely
                affect
                our revenues and/or income from operations unless we are able to
                obtain
                one or more new customers to offset this
                loss.





**Results
      of Operations for the Three Months ended March 31, 2007 Compared to the Three
      Months Ended March 31, 2006**





*Revenues*





Our
      revenues totaled $594,064 and $499,879 for the three months ended March 31,
      2007
      and 2006, respectively, an increase of $94,185 for the three months ended March
      31, 2007. The increase in revenues was primarily due to increase in sales
      contracts from the services business.





*Cost
      of Revenue*





Cost
      of
      revenue for the three months ended March 31, 2007 and 2006 were $443,347 and
      $329,525, respectively, an increase of $113,822. The increase in cost of revenue
      consisted primarily of increased temporary labor costs of $95,420.





*Expenses*





Operating
      expenses totaled $494,517 and $1,358,494 for the three month period ended March
      31, 2007 and 2006, respectively, a decrease of $863,977. The decrease resulted
      primarily from a decrease of approximately $802,759 in stock-based compensation
      for officers, directors, employees and consultants.





Non-operating
      income totaled $663,194 and expense totaled $152,050 for the three months ended
      March 31, 2007 and March 31, 2006, respectively, an increase of $815,244. The
      increase was primarily due to changes in the fair value of issued warrants
      of
      $818,509.




20





Interest
      expense totaled $87,281 and $140,421 for the three months ended March 31, 2007
      and 2006, respectively. The decrease in interest was due to a decrease in the
      amount of debt we have issued.





*Net
      Income/Loss*





The
      net
      income of $319,393 and net loss of $1,340,190 for the three months ended March
      31, 2007 and 2006, respectively, reflect an increase of $1,659,583. The
      increased net gain resulted from increased fair value of issued warrants and
      decreased operating expenses.





**Results
      of Operations for the Nine Months ended March 31, 2007 Compared to the Nine
      Months Ended March 31, 2006**





*Revenues*





Our
      revenues totaled $1,403,075 and $1,728,759 for the nine months ended March
      31,
      2007 and 2006, respectively, a decrease of $325,684 for the nine months ended
      March 31, 2007. The decrease in revenues was primarily due to the loss of a
      major sales contract from the services business.





*Cost
      of Revenue*





Cost
      of
      revenue for the nine months ended March 31, 2007 and 2006 were $1,090,833 and
      $1,155,958, respectively, a decrease of $65,125. The decrease in cost of revenue
      consisted primarily of lower labor costs of $105,970 and occupation fees of
      $62,314 both resulting from the loss of a major sales contract.





*Expenses*





Operating
      expenses totaled $2,598,771 and $2,946,054 for the nine month period ended
      March
      31, 2007 and 2006, respectively, a decrease of $347,283. The decrease resulted
      primarily from a decrease of approximately $586,734 in stock-based compensation
      for officers, directors, employees and consultants and an accrual of $446,615
      for litigation.





Non-operating
      income totaled $1,025,435 for the nine months ended March 31, 2007 and
      non-operating expense of $303,080 for the nine months ended March 31, 2006,
      an
      increase of $1,328,515 for the nine months ended March 31, 2007. The increase
      was primarily due to changes in the fair value of issued warrants.





Interest
      expense totaled $182,762 and $315,457 for the nine months ended March 31, 2007
      and 2006, respectively. The decrease in interest was due to a decrease in the
      amount of debt we have issued.





*Net
      Loss*





The
      net
      loss for the nine months ended March 31, 2007 and 2006 were $1,261,893 and
      $2,677,133, respectively, a decrease of $1,415,240. The decreased net loss
      resulted from decreased operating and non-operating expenses and the increased
      fair value of the issued warrants.





**Liquidity
      and Capital Resources**





At
      March
      31, 2007, our total assets were $2,559,321 compared to $1,417,374 as of June
      30,
      2006. Total current liabilities at March 31, 2007 were $2,491,656 compared
      to
      $2,196,415 as of June 30, 2006. We owe $66,529 in payroll withholding taxes
      that
      were assumed in a merger and are past due. Also, we are currently in default
      on
      two outstanding convertible bonds totaling $62,495. Interest continues to accrue
      against the principal. The notes are unsecured. The holders of the bonds that
      are in default have indicated that they do not want to convert their debt to
      stock and wish to be repaid in cash. At present, we do not have the funds to
      repay the indebtedness. It is not known whether we will be able to repay or
      renegotiate this debt. Additionally, our current liabilities exceeded our
      current assets by $2,012,174 at March 31, 2007. As a result of recurring losses
      from operations ($4,240,918), including net losses of $2,945,710 and $7,417,687
      for the fiscal years ending June 30, 2006 and 2005 our auditors, in their report
      dated September 15, 2006, have expressed substantial doubt about our ability
      to
      continue as going concern. We continue to experience losses from
      operations.




21





Net
      cash
      used in operating activities for the nine months ended March 31, 2007 was
      $1,218,156, primarily attributable to the increase in accounts receivable and
      other current assets of $145,683, an increase in accounts payable of $624,877,
      a
      decrease in payroll taxes payable of $123,007, and an decrease in deferred
      revenue of $8,421.





Net
      cash
      used in investing activities for the nine months ended March 31, 2007, was
      $16,478, attributable to acquisition of equipment offset by proceeds form sale
      of marketable securities.





Net
      cash
      provided by financing activities for the nine months ended March 31, 2007 was
      $947,046, which was from the issuance of $1,250,000 in convertible debentures
      and $2,502 from sale of stocks. In addition, we made $112,816 in lease payments,
      payments of $67,640 toward notes payable and recorded $125,000 in debenture
      expenses.





As
      a
      result of the above activities, we experienced a net decrease in cash and cash
      equivalents of $287,588 as of March 31, 2007 as compared to a $4,189 net
      increase in cash as of March 31, 2006. Our ability to continue as a going
      concern is still dependent on our success in obtaining additional financing
      from
      institutional investors or by selling our common shares and fulfilling our
      business plan. Other than as described below, we do not have any commitments
      for
      capital and we cannot give any assurances that capital will be available on
      terms we deem favorable or at all.





Our
      principal capital requirements during the fiscal year 2007 are to fund our
      internal operations and possibly make strategic acquisitions. We currently
      do
      not have any agreements or commitments for any acquisitions. We will need to
      obtain additional capital in order to expand operations. If we decide to make
      any acquisitions, we may need additional financing. In order to obtain capital,
      we may need to sell additional shares of our common stock or borrow funds from
      private lenders. We cannot assure you that we will be successful in obtaining
      additional funding. We have historically financed operations from the sale
      of
      our common stock and the conversion of common stock warrants. At March 31,
      2007,
      we had cash on hand of $122,419 as compared cash on hand of $410,007 at June
      30,
      2006.





Financing
      transactions may include the issuance of equity or debt securities, obtaining
      credit facilities, or other financing mechanisms. However, the trading price
      of
      our common stock and a downturn in the U.S. stock and debt markets could make
      it
      more difficult to obtain financing through the issuance of equity or debt
      securities. Even if we are able to raise the funds required, it is possible
      that
      we could incur unexpected costs and expenses, fail to collect significant
      amounts owed to us, or experience unexpected cash requirements that would force
      us to seek alternative financing. Further, if we issue additional equity or
      debt
      securities, stockholders may experience additional dilution or the new equity
      securities may have rights, preferences or privileges senior to those of
      existing holders of our common stock. If additional financing is not available
      or is not available on acceptable terms, we will have to curtail our
      operations.





To
      obtain
      funding for our ongoing operations, we entered into a Securities Purchase
      Agreement with Cornell Capital Partners L.P., an accredited investor, on May
      17,
      2006, and amended on September 15, 2006, for the sale of $2,000,000 in secured
      convertible debentures and warrants. The investors provided us with an aggregate
      of $2,000,000 as follows:





●
      $750,000 was disbursed on May 17, 2006;





●
      $150,000 was disbursed on September 15, 2006;





●
      $600,000 was
      disbursed on October
      23, 2006; and





●
      $500,000 was disbursed on February 12, 2007




22





Out
      of
      the $2 million in gross proceeds we received from Cornell Capital upon issuance
      of the secured convertible debentures, the following fees payable in cash were
      deducted in connection with the transaction:




·
            $200,000
                fee payable to Yorkville Advisors LLC, the general partner of Cornell
                Capital;


·
            $20,000
                fee payable to Yorkville Advisors LLC, the general partner of Cornell
                Capital;


·
            $20,000
                structuring fee payable to Yorkville Advisors LLC, the general partner
                of
                Cornell Capital; and


·
            $5,000
                due diligence fee payable to Cornell
                Capital.





Thus,
      we
      received net proceeds of $1,755,000 from the issuance of secured convertible
      debentures to Cornell Capital, prior to any other expenses we incurred in
      connection with the transaction.





The
      secured convertible debentures bear interest at 10%, mature three years from
      the
      date of issuance, and are convertible into our common stock, at the investor's
      option, at the lower of (i) $0.0662 or (ii) 95% of the lowest daily volume
      weighted average price of our common stock, as quoted by Bloomberg, LP, during
      the 30 trading days immediately preceding the date of conversion. **** Accordingly,
      there is no limit on the number of shares into which the secured convertible
      debentures may be converted. As of May 11, 2007, the lowest intraday trading
      price for our common stock during the preceding 30 trading days as quoted by
      Bloomberg, LP was $0.02 and, therefore, the conversion price for the secured
      convertible debentures was $0.019. Based on this conversion price, the
      $2,000,000 in secured convertible debentures, excluding interest, were
      convertible into 105,263,158 shares of our common stock. The conversion price
      of
      the secured convertible debentures will be adjusted in the following
      circumstances:





·
            If
                we pay a stock dividend, engage in a stock split, reclassify our
                shares of
                common stock or engage in a similar transaction, the conversion price
                of
                the secured convertible debentures will be adjusted proportionately;


·
            If
                we issue rights, options or warrants to all holders of our common
                stock
                (and not to Cornell Capital) entitling them to subscribe for or purchase
                shares of common stock at a price per share less than $0.0662 per
                share,
                other than issuances specifically permitted be the securities purchase
                agreement, then the conversion price of the secured convertible debentures
                will be adjusted on a weighted-average
                basis;


·
            If
                we issue shares, other than issuances specifically permitted be the
                securities purchase agreement, of our common stock or rights, warrants,
                options or other securities or debt that are convertible into or
                exchangeable for shares of our common stock, at a price per share
                less
                than $0.0662 per share, then the conversion price will be adjusted to such
                lower price on a full-ratchet
                basis;


·
            If
                we distribute to all holders of our common stock (and not to Cornell
                Capital) evidences of indebtedness or assets or rights or warrants
                to
                subscribe for or purchase any security, then the conversion price
                of the
                secured convertible debenture will be adjusted based upon the value
                of the
                distribution as a percentage of the market value of our common stock
                on
                the record date for such
                distribution;


·
            If
                we reclassify our common stock or engage in a compulsory share exchange
                pursuant to which our common stock is converted into other securities,
                cash or property, Cornell Capital will have the option to either
                (i)
                convert the secured convertible debentures into the shares of stock
                and
                other securities, cash and property receivable by holders of our
                common
                stock following such transaction, or (ii) demand that we prepay the
                secured convertible debentures; and


·
            If
                we engage in a merger, consolidation or sale of more than one-half
                of our
                assets, then Cornell Capital will have the right to (i) demand that
                we
                prepay the secured convertible debentures, (ii) convert the secured
                convertible debentures into the shares of stock and other securities,
                cash
                and property receivable by holders of our common stock following
                such
                transaction, or (iii) in the case of a merger or consolidation, require
                the surviving entity to issue to a convertible debenture with similar
                terms.




23




In
      connection with the securities purchase agreement, as amended, we agreed to
      issue Cornell warrants to purchase an aggregate of 56,397,000 shares of our
      common stock, exercisable for a period of five years; including warrants to
      purchase 17,857,000 shares at an exercise price of $0.05, warrants to purchase
      15,625,000 shares at an exercise price of $0.055, warrants to purchase
      12,500,000 shares at an exercise price of $0.065 and warrants to purchase
      10,415,000 shares at an exercise price of $0.08. All of the warrants were issued
      upon closing. We have the option to force the holder to exercise the warrants,
      as long as the shares underlying the warrants are registered pursuant to an
      effective registration statement, if the closing bid price of our common stock
      trades above certain levels. In the event that the closing bid price of our
      common stock is greater than or equal to $0.10 for a period of 20 consecutive
      days prior to the forced conversion, we can force the warrant holder to exercise
      the $0.05 warrants. In the event that the closing bid price of our common stock
      is greater than or equal to $0.11 for a period of 20 consecutive days prior
      to
      the forced conversion, we can force the warrant holder to exercise the $0.055
      warrants. In the event that the closing bid price of our common stock is greater
      than or equal to $0.13 for a period of 20 consecutive days prior to the forced
      conversion, we can force the warrant holder to exercise the $0.065 warrants.
      In
      the event that the closing bid price of our common stock is greater than or
      equal to $0.16 for a period of 20 consecutive days prior to the forced
      conversion, we can force the warrant holder to exercise the $0.08
      warrants.





We
      have
      the right, at our option, with three business days advance written notice,
      to
      redeem a portion or all amounts outstanding under the secured convertible
      debentures prior to the maturity date if the closing bid price of our common
      stock is less than $0.0662 at the time of the redemption. In the event of
      redemption, we are obligated to pay an amount equal to the principal amount
      being redeemed plus a 20% redemption premium, and accrued interest.


-


In
      connection with the securities purchase agreement, we also entered into a
      registration rights agreement providing for the filing, by September 29, 2006,
      of a registration statement with the Securities and Exchange Commission
      registering the common stock issuable upon conversion of the secured convertible
      debentures and warrants. We are obligated to use our best efforts to cause
      the
      registration statement to be declared effective no later than 90 days after
      September 29, 2006 and to insure that the registration statement remains in
      effect until the earlier of (i) all of the shares of common stock issuable
      upon
      conversion of the secured convertible debentures have been sold or (ii) May
      17,
      2008. In the event of a default of our obligations under the registration rights
      agreement, including our agreement to file the registration statement no later
      than September 29, 2006, or if the registration statement is not declared
      effective by December 29, 2006, we are required to pay Cornell Capital, as
      liquidated damages, for each month that the registration statement has not
      been
      filed or declared effective, as the case may be, either a cash amount or shares
      of our common stock equal to 2% of the liquidated value of the secured
      convertible debentures. The registration statement was declared effective on
      February 14, 2007. Cornell Capital has agreed to waive subsequent damages from
      the delays related to the registration statement.





In
      connection with the securities purchase agreement, we, and each of our
      subsidiaries, executed a security agreement in favor of the investor granting
      them a first priority security interest in all of our goods, inventory,
      contractual rights and general intangibles, receivables, documents, instruments,
      chattel paper, and intellectual property. The security agreement states that
      if
      an event of default occurs under the secured convertible debentures or security
      agreements, the investor has the right to take possession of the collateral,
      to
      operate our business using the collateral, and have the right to assign, sell,
      lease or otherwise dispose of and deliver all or any part of the collateral,
      at
      public or private sale or otherwise to satisfy our obligations under these
      agreements.





The
      investor has contractually agreed to restrict its ability to convert the
      debentures or exercise the warrants and receive shares of our common stock
      such
      that the number of shares of common stock held by it and its affiliates after
      such conversion does not exceed 4.99% of the then issued and outstanding shares
      of common stock. ****




24





**ITEM
      3. CONTROLS AND PROCEDURES**





*(a)
      Evaluation of disclosure controls and procedures.*





Our
      management, with the participation of our chief executive officer and chief
      financial officer, evaluated the effectiveness of our disclosure controls and
      procedures pursuant to Rule 13a-15 under the Securities Exchange Act of 1934
      as
      of March 31, 2007. In designing and evaluating the disclosure controls and
      procedures, management recognizes that any controls and procedures, no matter
      how well designed and operated, can provide only reasonable assurance of
      achieving the desired control objectives. In addition, the design of disclosure
      controls and procedures must reflect the fact that there are resource
      constraints and that management is required to apply its judgment in evaluating
      the benefits of possible controls and procedures relative to their costs.





Based
      on our evaluation, our chief executive officer and chief financial officer
      concluded that our disclosure controls and procedures are designed at a
      reasonable assurance level and are effective to provide reasonable assurance
      that information we are required to disclose in reports that we file or submit
      under the Exchange Act is recorded, processed, summarized and reported within
      the time periods specified in Securities and Exchange Commission rules and
      forms, and that such information is accumulated and communicated to our
      management, including our chief executive officer and chief financial officer,
      as appropriate, to allow timely decisions regarding required disclosure.





*(b)
      Changes in internal control over financial reporting.*





We regularly
      review our system of internal control over financial reporting and make changes
      to our processes and systems to improve controls and increase efficiency, while
      ensuring that we maintain an effective internal control environment. Changes
      may
      include such activities as implementing new, more efficient systems,
      consolidating activities, and migrating processes.





There
      were no changes in our internal control over financial reporting that occurred
      during the period covered by this Quarterly Report on Form 10-QSB that have
      materially affected, or are reasonably likely to materially affect, our internal
      control over financial reporting.




25


**PART
      II -- OTHER INFORMATION**





**Item
      1. Legal Proceedings**





From
      time
      to time, we may become involved in various lawsuits and legal proceedings which
      arise in the ordinary course of business. However, litigation is subject to
      inherent uncertainties, and an adverse result in these or other matters may
      arise from time to time that may harm our business. Except as disclosed below,
      we are currently not aware of any such legal proceedings or claims that we
      believe will have, individually or in the aggregate, a material adverse affect
      on our business, financial condition or operating results.





**Index
      Number: GIC872522**  **-
      Superior Court of California, County of San Diego**





We
      were
      served with a summons as a defendant in a case filed on September 15, 2006
      in
      Superior Court of California, County of San Diego. The complaint was filed
      by
      Golden Gate Investors for Breach of Contract relating to the financing
      agreements executed between us and Golden Gate Investors in August 2004. Golden
      Gate Investors is claiming damages in excess of $718,765 in relation to the
      case. We have retained counsel to defend ourselves in this matter and we have
      filed a response and counter claim for undisclosed damages. The action was
      very
      recently assigned a trial date of August 31, 2007. The action is in the
      discovery stage and, while we expect to vigorously contest the claims against
      us, and to pursue our claims against GGI, we cannot predict the outcome. We
      have
      recorded payables and an accrued legal expense totaling $718,765.





**Index
      Number: 06CC11306 - Superior Court of California, County of
      Orange**





We
      were
      served with a summons as a defendant in a case filed on October 24, 2006 in
      Superior Court of California, County of Orange by Single Source Partners for
      failure to pay commissions and installment payments. Single Source Partners
      is
      seeking judgment in the amount of $51,206. We have retained counsel to defend
      ourselves in this matter and we have filed a response and counter claim for
      undisclosed damages. The action has been assigned a trial date of October 20,
      2007. The action is in the discovery stage and, while we expect to vigorously
      contest the claims against us, and pursue our claims against SSP, we cannot
      predict the outcome. We have recorded payables and an accrued partnership fee
      totaling $56,605.





**Item
      2. Unregistered Sales of Equity Securities and Use of Proceeds**





On
      February 14, 2007, we issued 2,923,977 shares of common stock to Cornell Capital
      Partners upon conversion of outstanding debentures in the amount of
      $50,000.





On
      March
      8, 2007, we issued 2,503,703 to corporate officers upon exercise of outstanding
      warrants.





Unless
      otherwise noted, the sales set forth above involved no underwriter's discounts
      or commissions and are claimed to be exempt from registration with the
      Securities and Exchange Commission pursuant to Section 4 (2) of the Securities
      Act of 1933, as amended, as transactions by an issuer not involving a public
      offering, the issuance and sale by the Company of shares of its common stock
      to
      financially sophisticated individuals who are fully aware of the Company's
      activities, as well as its business and financial condition, and who acquired
      said securities for investment purposes and understood the ramifications of
      same.





**Item
      3. Defaults Upon Senior Securities**





On
      August
      3, 2004, we entered into a financing arrangement with Golden Gate Investors,
      Inc. and executed a two year convertible debenture for $300,000.  We are in
      default of the debenture balance in the amount of $210,674.




26





**Item
      4. Submission of Matters to a Vote of Security Holders**





None





**Item
      5. Other Information**





None





**Item
      6. Exhibits**





31.1
            Certification
                of Chief Executive Officer pursuant to Rule 13a-14 and Rule 15d-14(a),
                promulgated under the Securities and Exchange Act of 1934, as
                amended





31.2
            Certification
                of Chief Financial Officer pursuant to Rule 13a-14 and Rule 15d 14(a),
                promulgated under the Securities and Exchange Act of 1934, as
                amended





32.1
            Certification
                pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
                906 of
                the Sarbanes-Oxley Act of 2002 (Chief Executive
                Officer)





32.2
            Certification
                pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
                906 of
                the Sarbanes-Oxley Act of 2002 (Chief Financial
                Officer)





27


**Signatures**





Pursuant
      to the requirements of the Securities Exchange Act of 1934, the registrant
      has
      duly caused this report to be signed on its behalf by the undersigned, thereunto
      duly authorized.




**QUINTEK TECHNOLOGIES,
              INC.**Date:
                May 14, 2007
            By:
            /s/
                JAMES KERNANJames
                KernanChief
                Executive Officer (Principal Executive Officer) and
                DirectorDate:
                May 14, 2007
            By:
            /s/
                ANDREW HAAGAndrew
                HaagChief
                Financial Officer (Principal Financial Officer and Principal Accounting
                Officer) and Director




28