U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



FORM 10-Q



(Mark One)



|  |                                                                                                                                      
|- | -------------------------------------------------------------------------------------------------------------------------------------
|R | QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED September 30, 2008.



|  |                                                                                                                                              
|- | ---------------------------------------------------------------------------------------------------------------------------------------------
|£ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD OF _________ TO _________



Commission File Number: 000-19846



Current Technology Corporation

(Exact name of registrant as specified in its charter)



|                               |                    
|------------------------------ | -------------------
|Canada                         | __N/A_____         
|State or other jurisdiction of | (I.R.S. Employer   
|incorporation or organization  | Identification No.)



800 West Pender Street, Suite 1430

Vancouver, B.C., Canada V6C 2V6

(Address of principal executive offices, including zip code)



Registrants telephone number: (604) 684-2727





Indicate by check mark whether the registrant (1) 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 oNo R



Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company:



Large accelerated filer o

Accelerated filer o

Non-accelerated filer o    Smaller Reporting company R



Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes oNo R



As of November 14, 2008, there were 141,911,253 shares of the Registrants no par value Common Stock (Common Stock), Registrants only outstanding class of voting securities, outstanding









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CURRENT TECHNOLOGY CORPORATION

QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED September 30, 2008





PART I  FINANCIAL INFORMATION







ITEM 1. Financial Statements (unaudited)





INDEX TO CONSOLIDATED FINANCIAL STATEMENTS





Consolidated Financial Statements:



Consolidated Balance Sheets as of December 31, 2007 and September 30, 2008 .........



Consolidated Statements of Operations for the three and nine month period ended

September 30, 2008 and September 30, 2007



Consolidated Statements of Cash Flow for the nine month period ended

September 30, 2008 and September 30, 2007



Condensed Notes to Consolidated Financial Statements





















[The balance of this page has been intentionally left blank.]









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CURRENT TECHNOLOGY CORPORATION

(CORPORATION TECHNOLOGIE AU COURANT)



Vancouver, BC





INTERIM CONSOLIDATED FINANCIAL STATEMENTS



For the Nine Months Period Ended September 30, 2008















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CURRENT TECHNOLOGY CORPORATION

(CORPORATION TECHNOLOGIE AU COURANT)

INDEX TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS





Interim Consolidated Balance Sheet

Interim Consolidated Statement of Operations and Deficit

Interim Consolidated Statement of Cash Flows

Notes to Interim Consolidated Financial Statements







_________________________________



























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CURRENT TECHNOLOGY CORPORATION

(Incorporated under the Canada Business Corporations Act)

Interim Consolidated Balance Sheet

September 30, 2008 and December 31, 2007

(United States Dollars)





|                                                            |                              |                   | 
|----------------------------------------------------------- | ---------------------------- | ----------------- | 
|Assets                                                      | September 30, 2008
Unaudited | December 31, 2007
|Current Assets:                                             |                              |                  
|Cash and cash equivalents                                   | $381,614                     | $33,498          
|Accounts receivable                                         | 202,592                      | 27,617           
|Inventory                                                   | 265,458                      | 61,920           
|Prepaid expenses                                            | 23,785                       | 17,926           
|Subscription receivable                                     | -                            | 49,412           
|Total Current Assets                                        | 873,449                      | 190,373          
|                                                            |                              |                  
|Equipment, Furniture, & Capital Lease (Note 8)              | 478,250                      | -                
|Less accumulated depreciation                               | 108,355                      | -                
|Total Equipment, Furniture & Capital Lease                  | 369,915                      | -                
|                                                            |                              |                  
|Goodwill                                                    | 952,942                      | -                
|Intangible Assets                                           | 2,595,144                    | -                
|Total Assets                                                | $4,791,450                   | $190,373         
|                                                            |                              |                  
|Liabilities and Stockholders Equity and (Deficiency)       |                              |                  
|Current Liabilities:                                        |                              |                  
|Accounts payable and accrued liabilities                    | $623,525                     | $346,943         
|Total current liabilities                                   | 623,525                      | 346,943          
|                                                            |                              |                  
|Convertible promissory note (Note 9)                        | 1,320,081                    | 1,121,489        
|Total liabilities                                           | 1,943,606                    | 468,432          
|Minority interests in subsidiary companies                  | 730,459                      | -                
|                                                            |                              |                  
|Stockholders Equity:                                       |                              |                  
|Subscription liability (Note 10)                            | 37,500                       | 27,898           
|Common shares without par value (Note 10)                   | 30,135,667                   | 25,787,959       
|Additional paid-in capital (Note 11)                        | 4,090,332                    | 1,865,581        
|Accumulated deficit                                         | (32,164,864)                 | (28,660,295)     
|Accumulated other comprehensive income                      | 18,750                       | (299,202)        
|Total stockholders equity and (deficiency)                 | 2,117,385                    | (1,278,059)      
|Total Liabilities and Stockholders Equity and (Deficiency) | $4,791,450                   | $190,373         
|                                                            |                              |                  
|Going Concern (Note 3 )                                     |                              |                  
|Commitments (Note17)                                        |                              |                  
|Subsequent Events (Note18)                                  |                              |                  



See accompanying notes -



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|                                                                                |  |  | 
|------------------------------------------------------------------------------- |  |  | 
|Approved by Directors:

__ Robert Kramer  ________

__ George Chen_________ |  | 
|                                                                                |  | 
|                                                                                |  | 

CURRENT TECHNOLOGY CORPORATION

Interim Consolidated Statement of Operations and Deficit

For the nine months ended September 30

(Unaudited)

(United States Dollars)

|                                                                                                                                |                                  |                                 |                                  |                               
|------------------------------------------------------------------------------------------------------------------------------- | -------------------------------- | ------------------------------- | -------------------------------- | ------------------------------
|                                                                                                                                | Three months ended September 30, | Nine months ended September 30, | Three months ended September 30, | Nine months ended September 30
|                                                                                                                                | 2008                             | 2008                            | 2007                             | 2007                          
|Revenue                                                                                                                         | $      258,946                   | $      613,674                  | $        23,082                  | $     226,206                 
|Cost of sales                                                                                                                   | 233,061                          | 561,704                         | 10,239                           | 210,640                       
|                                                                                                                                | 25,885                           | 51,970                          | 12,843                           | 15,566                        
|                                                                                                                                |                                  |                                 |                                  |                               
|Selling, General and Administrative Costs and Expenses                                                                          |                                  |                                 |                                  |                               
|General & Administrative                                                                                                        | 959,083                          | 1,337,437                       | 129,284                          | 239,636                       
|Salaries & wages                                                                                                                | 806,381                          | 1,697,469                       | 332,512                          | 502,795                       
|Legal, auditing and filing fees                                                                                                 | 219,231                          | 433,335                         | 95,589                           | 203,367                       
|Amortization and depreciation                                                                                                   | 191,929                          | 228,203                         | -                                | -                             
|Consulting                                                                                                                      | 168,310                          | 387,868                         | 269,404                          | 314,524                       
|Corporate Communications                                                                                                        | 40,873                           | 157,298                         | 21,496                           | 64,156                        
|Interest on convertible promissory note                                                                                         | 28,654                           | 85,241                          | 26,391                           | 76,074                        
|Business development                                                                                                            | 11,642                           | 500,250                         | -                                | -                             
|Foreign Exchange (Recovery)                                                                                                     | 180,366                          | 181,969                         | (56,934)                         | (162,469)                     
|Total Selling, General and Administrative Costs and Expenses                                                                    | 2,606,469                        | 5,009,070                       | 817,742                          | 1,238,083                     
|                                                                                                                                |                                  |                                 |                                  |                               
|Income (Loss) from operations before income taxes, minority interests and equity in net loss (income) from associated companies | (2,580,584)                      | (4,957,100)                     | (804,899)                        | (1,222,517)                   
|Income taxes                                                                                                                    | -                                | -                               | -                                | -                             
|Loss from associated companies before acquisition                                                                               | -                                | 697,652                         | -                                | -                             
|Minority interest                                                                                                               | 751,124                          | 1,181,589                       | -                                | -                             
|Equity in net loss (income) from associated companies                                                                           | -                                | 261,590                         | -                                | -                             
|Net loss                                                                                                                        | (1,829,460)                      | (3,339,449)                     | (804,899)                        | (1,222,517)                   
|Deficit, beginning                                                                                                              | (30,335,404)                     | (28,825,415)                    | $(27,330,111)                    | (27,112,143)                  
|Deficit, ending,                                                                                                                | $(32,164,864)                    | $(32,164,864)                   | $(28,334,660)                    | $(28,334,660)                 
|                                                                                                                                |                                  |                                 |                                  |                               
|Basic and fully diluted net loss per share                                                                                      | $        (0.0136)                | $       (0.0259)                | $       (0.0084)                 | $       (0.0133)              
|Weighted average shares outstanding                                                                                             | 134,594,586                      | 129,099,462                     | 96,125,356                       | 91,616,467                    
|                                                                                                                                |                                  |                                 |                                  |                               
|                                                                                                                                |                                  |                                 |                                  |                               
|                                                                                                                                |                                  |                                 |                                  |                               
|                                                                                                                                |                                  |                                 |                                  |                               





See accompanying notes -



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CURRENT TECHNOLOGY CORPORATION

Interim Consolidated Statement of Cash Flows

For the nine months ended September 30

(Unaudited)

(United States Dollars)







|                                                                                          |              |                                  |                                |                                  |                                |  |  |  |  | 
|----------------------------------------------------------------------------------------- | ------------ | -------------------------------- | ------------------------------ | -------------------------------- | ------------------------------ |  |  |  |  | 
|                                                                                          |              | Three months ended September 30, | Nine months ended September 30 | Three months ended September 30, | Nine months ended September 30
|                                                                                          |              | 2008                             | 2008                           | 2007                             | 2007                          
|Operating Activities:                                                                     |              |                                  |                                |                                 
|Net Loss                                                                                  | $(1,829,460) | $(3,339,449)                     | $(804,900)                     | $(1,222,518)                    
|Adjustments to reconcile net loss to net cash provided by (used in) operating activities- |              |                                  |                                |                                 
|Amortization and Depreciation                                                             | 191,929      | 228,203                          | -                              | -                               
|Bad debt expense                                                                          | -            | 10,250                           | -                              | -                               
|Additional paid in capital                                                                | 873,753      | 1,187,780                        | 504,211                        | 519,416                         
|Shares issued for services provided                                                       | -            | 103,750                          | -                              | -                               
|Interest on promissory note                                                               | 28,655       | 85,241                           | (23,740)                       | (76,074)                        
|Minority interest                                                                         | (751,124)    | (1,181,589)                      | -                              | -                               
|Loss before acquisition                                                                   | -            | (697,652)                        | -                              | -                               
|Equity from associated companies                                                          | -            | 261,590                          | -                              | -                               
|Professional fees accrued                                                                 | 12,000       | 12,000                           | -                              | -                               
|Expense recovery                                                                          | (21,611)     | (21,611)                         | -                              | -                               
|Exchange adjustment                                                                       | 9,828        | (7,948)                          | (1,852)                        | 908                             
|Changes in operating assets and liabilities-                                              |              |                                  |                                |                                 
|(Increase) Decrease in accounts receivable                                                | 11,988       | (157,467)                        | (8,033)                        | (45,547)                        
|(Increase) Decrease in inventory                                                          | 97,549       | (203,538)                        | (783)                          | (29,556)                        
|(Increase) Decrease in prepaid expenses                                                   | (5,206)      | 24,535                           | 39,621                         | 47,741                          
|(Increase) Decrease in subscription receivable                                            | 36,250       | 49,412                           | (45,022)                       | (45,022)                        
|Increase (Decrease) in accounts payable                                                   | (172,094)    | (80,872)                         | 52,188                         | (107,981)                       
|Increase (Decrease) in unearned revenue                                                   | -            | -                                | 1,677                          | 63,282                          
|Net cash used in operating activities                                                     | (1,517,543)  | ( 3,727,365)                     | (375,013)                      | (895,532)                       
|Cash flows from investing activities                                                      |              |                                  |                                |                                 
|Fixed assets purchase                                                                     | (19,355)     | (265,750)                        | -                              | -                               
|Net cash used in investing activities                                                     | (19,355)     | (265,750)                        | -                              | -                               
|Cash flows from financing activities:                                                     |              |                                  |                                |                                 
|Issuance of new shares                                                                    | 1,195,000    | 4,203,731                        | 282,500                        | 947,372                         
|Subscription advances                                                                     | -            | 37,500                           | (3,409)                        | (62,377)                        
|Convertible promissory note                                                               | 100,000      | 100,000                          | -                              | -                               
|Net cash provided by financing activities                                                 | 1,295,000    | 4,341,231                        | 279,091                        | 884,995                         
|Net Increase in Cash and Cash Equivalents                                                 | (241,898)    | 348,116                          | (7,543)                        | (10,357)                        
|Cash and Cash Equivalents, beginning                                                      | 623,512      | 33,498                           | 42,271                         | 45,085                          
|Cash and Cash Equivalents, ending                                                         | $   381,614  | $   381,614                      | $    34,728                    | $    34,728                     
|                                                                                          |              |                                  |                                |                                  |                               
|                                                                                          |              |                                  |                                |                                  |                               
|                                                                                          |              |                                  |                                |                                  |                               
|                                                                                          |              |                                  |                                |                                  |                               
|                                                                                          |              |                                  |                                |                                  |                               
|                                                                                          |              |                                  |                                |                                  |                               



See accompanying notes -



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CURRENT TECHNOLOGY CORPORATION

Notes to Interim Consolidated Financial Statements

For the nine months ended September 30, 2008 and 2007

Unaudited- (United States Dollars)





1.

Basis of Presentation:



The accompanying unaudited interim consolidated financial statements have been prepared in accordance with US generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X.  Accordingly, they do not include all the information and notes required by US generally accepted accounting principles for complete financial statements of Current Technology Corporation and its subsidiaries (the Company).  In the opinion of management, all adjustments consisting of normal recurring adjustments necessary for a fair presentation have been included.  Interim results are not necessarily indicative of the results that may be expected for the year.  The unaudited interim consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the year ended December 31, 2007 included in the Companys Form 20-F filed with the Securities and Exchange Commission (the SEC) on July 11, 2008.



The consolidated balance sheet at December 31, 2007 has been derived from the audited financial statements at that date but does not include all the information and notes required by US generally accepted accounting principles for complete financial statements.



The acquisitions described in Note 7 below significantly affects the comparability of the financial information as of September 30, 2008 and for the three and six month periods then ended.



2.

Nature of Operations:



On January 31, 2008, the Company entered into a securities purchase agreement with Celevoke, Inc. (Celevoke).  On May 23, 2008, the Company completed the purchase of 102 shares of Celevoke common stock for an aggregate purchase price of $2.5 million. During the quarter ended September 30, 2008, the Company purchased an additional 28 common shares of Celevoke for a price of $850,000.



The Company has a 56% interest in Celevoke as at September 30, 2008. Management believes Celevoke has a number of attributes which should lead to success in the market place. These include a suite of fully developed GPS-based asset tracking devices, a non-exclusive worldwide license with the patent holder, a fully functioning network operations center and established relationships with a number of channels of distribution. (See Note 7)



The Company has developed an electrotherapeutic medical device designed to stimulate hair regrowth  (ElectroTrichoGenesis or ETG) and a cosmetic unit designed to improve the appearance of thinning hair (CosmeticTrichoGenesis or CTG).  ETG and CTG are marketed as TrichoGenesis platform products. The Company has entered into an exclusive distribution agreement with an entity based in the United States for the placement on a revenue sharing basis of its TrichoGenesis platform products in the United States, Canada, South America (excluding Brazil), Europe and Russia. The Company is working in concert with its United States based distributor to attempt to lower the cost of ETG devices and CTG units by having non-proprietary components of the chair and hood manufactured in China. During the last year, the Company established a security products division.

The Company was incorporated on June 3, 1986 and commenced operations on April 21, 1987. The Company currently does not generate sufficient funds from operations to support continuing activities and has financed expenditures through private and public offerings of equity securities and the private placement of debt instruments. The common shares of the Company trade on the OTCBB in the United States under symbol "CRTCF".









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CURRENT TECHNOLOGY CORPORATION

Notes to Interim Consolidated Financial Statements

For the nine months ended September 30, 2008 and 2007

Unaudited- (United States Dollars)







3.

Going Concern:



These unaudited consolidated financial statements have been prepared on the going concern assumption that the Company will be able to realize its assets and discharge its liabilities in the normal course of business.



A net loss of $3,339,449 was incurred during the nine months (2007: $1,222,517).  Recurring losses have been reported since inception, which have resulted in an accumulated deficit of $32,164,864 (2007: $28,334,660). The Company may attempt to obtain additional debt or equity financing which could result in receipt of additional financing but there can be no assurance that such capital will be available in sufficient amounts or on acceptable terms and there is no certainty that these discussions will be concluded successfully.



The ability of the Company to continue as a going concern is dependent on the successful conclusion of these discussions, the receipt of additional financing, and/or proceeds on the sale of assets and ultimately its ability to generate sufficient cash from operations and financing sources to meet its obligations as they come due.



If the Company is unable to continue as a going concern, material adjustments may be required to the carrying value of assets and liabilities and to the classifications used on the balance sheet.



Any inability to obtain additional financing when needed would have a material adverse affect on the Company including possibly requiring the Company to significantly reduce or cease its operations.



4.

Accounting changes:



a)

Change in Functional Currency





Effective January 1, 2008, the Company changed its functional currency to the U.S. dollar from the Canadian dollar. With the acquisition of Celevoke, Inc (Note 7), the Companys primary economic environment has now changed from Canada to United States.  This has resulted in significant changes in economic facts and circumstances that clearly indicate that the functional currency has changed.  The Company accounted for the change in functional currency prospectively.



The financial statements of the Company for the year ended December 31, 2007 which is based on the Canadian functional currency, has been translated into the U.S. reporting currency using the current rate method as allowed by Statement of Financial Accounting Standards No.52 ("SFAS 52") as follows:  assets and liabilities using the rate of exchange prevailing at the balance sheet date; stockholders' deficiency using the applicable historic rate; and revenue and expenses using the monthly average rate of exchange. Translation adjustments have been included as part of the accumulated other comprehensive income.





5.

Recent Accounting Pronouncements:



In February 2008, the FASB issued FASB Staff Position (FSP) FAS 157-2, which delays the effective date of SFAS No. 157 to fiscal years beginning after November 15, 2008 and interim periods within those fiscal years, for all non-financial assets and non-financial liabilities, except those that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually).  Examples of items to which the deferral would apply include, but are not limited to:





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CURRENT TECHNOLOGY CORPORATION

Notes to Interim Consolidated Financial Statements

For the nine months ended September 30, 2008 and 2007

Unaudited- (United States Dollars)





5.

Recent Accounting Pronouncements (continued):



·

Non-financial assets and non-financial liabilities initially measured at fair value in a business combination or other new basis event, but not measured at fair value in subsequent periods (non-recurring fair value measurements)

·

Reporting units measured at fair value in the first step of a goodwill impairment test and non-financial assets and non-financial liabilities measured at fair value in the second step of a goodwill impairment test (measured at fair value on a recurring basis, but not necessarily recognized or disclosed in the financial statements at fair value)

·

Indefinite-lived intangible assets measured at fair value for impairment assessment (measured at fair value on a recurring basis, but not necessarily recognized or disclosed in the financial statements at fair value)

·

Long-lived assets (asset groups) measured at fair value for an impairment assessment (non-recurring fair value measurements); and

·

Liabilities for exit or disposal activities initially measured at fair value (non-recurring fair value measurements)



In March 2008, the FASB issued Statement No. 161, Disclosure about Derivative Instruments and Hedging Activities  an amendment of FASB Statement No. 133 (SFAS 161).  SFAS 161 requires companies to provide enhance disclosures regarding derivative instruments and hedging activities.  It requires companies to better convey the purpose of derivative use in terms of the risks that such company is intending to manage.  Disclosures about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for under SFAS No. 133 and its related interpretations, and (c) how derivative instruments and related hedged items affect a companys financial position, financial performance, and cash flows are required.  SFAS 161 contains the same scope as SFAS 133 and is effective for fiscal years and interim periods beginning after November 15, 2008.  The Company will adopt SFAS 161 on January 1, 2009, as required, and management does not believe adoption of SFAS 161 will have any impact on the Companys financial position, results of operations or cash flows.



In February 2008, the FASB issued a FASB Staff Position (FSP) on Accounting for Transfers of Financial Assets and Repurchase Financing Transactions (FSP FAS 140-3).  FSP FAS 140-3 addresses the issue of whether or not these transactions should be viewed as two separate transactions or as one linked transaction.  The FSP includes a rebuttable presumption that presumes linkage of the two transactions unless the presumption can be overcome by meeting certain criteria.  The FSP will be effective for fiscal years beginning after November 15, 2008 and will apply only to original transfers made after that date.  We do not expect the adoption of FSP FAS 140-3 to have significant impact on our financial position, results of operation or cash flows.



In April 2008, the FASB issued FASB Staff Position (FSP) No. SFAS 142-3, Determination of the Useful Life of Intangible Assets (FSP SFAS 142-3).  FSP SFAS 142-3 amends the factors that should be considered in developing renewal or extension assumptions used to determine the useful life of a recognized intangible asset under SFAS No. 142, Goodwill and Other Intangible Assets (SFAS 142).  The intent of FSP SFAS 142-3 is to improve the consistency between the useful life of a recognized intangible asset under SFAS 142 and the period of expected cash flows used to measure the fair value of the asset under SFAS No. 141R (revised 2007), Business Combination (SFAS 141R) and other applicable accounting literature.  FSP SFAS 142-3 is effective for financial statements issued for fiscal years beginning after December 15, 2008 and must be applied prospectively to intangible assets

acquired after the effective date.  The Company is currently evaluating the potential impact, if any, of FSP SFAS 142-3 on its financial position, results of operations or cash flows.





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CURRENT TECHNOLOGY CORPORATION

Notes to Interim Consolidated Financial Statements

For the nine months ended September 30, 2008 and 2007

Unaudited- (United States Dollars)





5.

Recent Accounting Pronouncements (continued):



In May 2008, the FASB issued SFAS No. 162, Hierarchy of Generally Accepted Accounting Principles (SFAS 162).  This statement is intended to improve financial reporting by identifying a consistent framework, or hierarchy, for selecting accounting principles to be used in preparing financial statements of nongovernmental entities that are presented in conformity with GAAP.  This statement will be effective 60 days following the US Securities and Exchange Commissions approval of the Public Company Accounting Oversight Board amendment to AU Section 411, The Meaning of Present Fairly in Conformity with Generally Accepted Accounting Principles.  The Company is currently evaluating the potential impact, if any, of the adoption of SFAT 162 on its financial position, results of operations or cash flows.



In June 2008, the FASB issued FSP No. EITF 03-6-1, Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities (FSP EITF 03-6-1).  FSP EITF 03-6-1 affects entities that accrue cash dividends on share-based payment awards during the awards service period when dividends do not need to be returned if the employees forfeit the awards.  FSP EITF 03-6-1 is effective for fiscal years beginning after December 15, 2008 and earnings-per-unit calculations would need to be adjusted retroactively.  We do not expect the adoption of FSP EITF 03-6-1 to have significant impact on our financial position, results of operation or cash flows.





6.

Summary of Significant Accounting Policies:



a)

Equipment, Furniture and Capital Lease



Leasehold, equipment and furniture are stated at cost.  Maintenance and repairs are charged to expense as incurred.  Expenditures, which extend the physical or economic life of the assets are capitalized and depreciated.  Depreciation is provided using the straight-line method over the estimated useful life as follows:



Equipment

1-5 years

Furniture

3 years

Leasehold improvement

1.5 years

Capital Lease

5 years



b)

Impairment of Long-Lived Assets



In accordance with SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets, long lived assets, such as equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimate undiscounted future cash flow expected to be generated by the asset.  If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeded the fair value of the asset.  Assets to be disposed of would be separately presented in the balance sheet and reported at the lower of the carrying amount or the fair value less costs to sell, and are no longer depreciated.  The assets and liabilities of a disposed group classified as held for sale would be presented separately in the appropriate asset and liability sections of the balance sheet.  As at September 30, 2008 and December 31, 2007, there was no impairment of the Companys long lived assets.







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CURRENT TECHNOLOGY CORPORATION

Notes to Interim Consolidated Financial Statements

For the nine months ended September 30, 2008 and 2007

Unaudited- (United States Dollars)





6.

Summary of Significant Accounting Policies (continued):



c)

Revenue recognition



The Company recognizes revenue in accordance with Securities and Exchange Commission Staff Accounting Bulletin No. 104, Revenue Recognition in Financial Statements ("SAB 104").



i)

The following policies have been established with respect to revenue recognition on the sale of ETG devices and CTG units:



1)

Purchase/sale negotiations conclude with an agreement to purchase and are also secured by a deposit;



2)

Goods are shipped when collection of the balance of the purchase price is reasonably assured.  This is indicated by:

a)

actual receipt of funds from distributors or customers; or



b)

secured lease or term financing by distributors or customers which would result in immediate payment of the balance upon delivery; or



c)

distributors or customers exceptional credit and operating history, and an agreement in writing to specific terms of payment;



3)

Revenue is recognized only after goods are shipped.  At this point collection is reasonably assured and risks and rewards of ownership have been transferred.



4)

Revenue from royalty agreements is recognized when earned, which is generally the period in which the services to which the royalty relates are provided to third parties and collection of the balance owing is reasonably assured.



Customer deposits, as required by the Companys revenue recognition policy above, received in advance are treated as deferred revenue until goods are shipped.  Only then revenue is recognized.



Revenue recognition relating to the Companys subsidiary, Celevoke Incs wireless asset tracking or control systems and internet hosting operation is recognized when evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable and collectability is probable.  The Companys subsidiary enters into certain arrangements, where it is obligated to deliver multiple products and / or services (multiple elements).  In these arrangements, the Companys subsidiary generally allocates the total revenue among the elements based on the sales price of each element when sold separately (vendor-specific objective evidence).



d)

Deferred Revenues



Deferred revenue is attributable to deposits made by customers for goods and services not yet rendered.  Unearned revenue from certain licensing programs represents customer billings, paid either upfront or at the beginning of each billing coverage period, that are accounted for as subscriptions with revenue recognized ratably over the billing coverage period.  For certain other licensing arrangements, revenue attributable to undelivered elements is based on the sales price of those elements when sold separately and is recognized ratably on a straight-line basis over the related products life cycle.  Deferred revenues include subscription services where we have been paid upfront and earn the revenue when we provide the service or otherwise meet the revenue recognition criteria.





Page5



---

CURRENT TECHNOLOGY CORPORATION

Notes to Interim Consolidated Financial Statements

For the nine months ended September 30, 2008 and 2007

Unaudited- (United States Dollars)





6.

Summary of Significant Accounting Policies (continued):



e)

Cost of Sales



Cost of revenue includes direct costs to produce and distribute products / or services and the direct costs associated with the delivery of online services, professional services, product support and resold hardware



f)

Equity Investment



Purchased equity interests that are not publicly traded and / or do not have a readily determinable fair value are accounted for pursuant to the equity method of accounting if the Companys ownership position is large enough to significantly influence the operating and financial policies of an investee.  This is generally presumed to exist when we own between 20% - 50% of a corporation.  The Companys share of earnings and losses in equity method investees is included in loss from equity method investments on the Consolidated Statement of Operations.

For investments accounted for using the equity method of accounting, management evaluates information such as budgets, business plans, financial statements of the investee in determining

whether an other-than-temporary decline in value exists.  Factors indicative of an other-than-temporary decline in value include, but not limited to, recurring operating losses and credit defaults.  For any of the Companys investments in which the estimated fair value is less than its carrying value, the Company considers whether the impairment of that investment is other-than-temporary.





7.

Acquisitions:



Celevoke Inc



On January 31, 2008, the Company entered into a securities purchase agreement with Celevoke, Inc (Celevoke).  Under the agreement the Company is committed to purchase 102 shares of Celevoke common stock for an aggregate purchase price of $2,500,000.  The 102 shares are to be purchased in four installments of 20 shares and a fifth installment of 22 shares.



As at March 31, 2008, the Company completed the purchase of 60 shares out of the 102 shares of Celevoke common stock for total consideration of $1,500,000.  The 60 shares gave the Company 37.5% equity interest in Celevoke.  Consequently, the Company has accounted for this 37.5% interest in Celevoke as an equity investment.



On May 23, 2008, the Company completed the purchase of the remaining 42 shares of Celevoke and increased its ownership interest in the voting equity of Celevoke from 37.5% to 51%.  Effective with the close of that transaction on May 23, 2008, the Company began consolidating Celevokes financial results into the Companys interim consolidated financial statements.



On August 13, 2008, the Company completed the purchase of an additional 25 shares of Celevoke for $750,000 and on September 29, 2008 completed the purchase of another additional 3 shares of Celevoke for $100,000 and increased its ownership interest in the voting equity of Celevoke from 51% to 56%.











Page6



---

CURRENT TECHNOLOGY CORPORATION

Notes to Interim Consolidated Financial Statements

For the nine months ended September 30, 2008 and 2007

Unaudited- (United States Dollars)





7.

Acquisitions (continued):



The acquisition was recorded under the purchase method of accounting and the purchase price was allocated based on the fair value of the assets acquired and the liabilities assumed to the extent of the 56% ownership interest acquired as of the various date the payments were made under step acquisition accounting.    The remaining 44% portion of the acquired net assets represents the minority interest ownership in Celevoke.



Star One Telematica S/A



On May 5, 2008, the Companys 51% owned subsidiary, Celevoke, acquired 521 common shares of Star One Telematica S/A, a company incorporated under the laws of Brazil, for a 51% interest.





8.

Equipment, Furniture and Capital Lease



|                        |             |                          |             |              
|----------------------- | ----------- | ------------------------ | ----------- | -------------
|                        | Cost        | Accumulated Amortization | 2008 Net    | 2007 Net     
|Capital Lease           | $   212,500 | $   74,375               | $  138,125  | $           -
|Furniture  and fixtures | 10,900      | 1,984                    | 8,916       | -            
|Equipment               | 235,647     | 24.079                   | 211,568     | -            
|Leasehold improvement   | 19,203      | 7,897                    | 11,306      | -            
|                        | $478,250    | $108,335                 | $   369,915 | $          - 



9.

Convertible Promissory Note:



On September 29, 2008, the Company extended the maturity date of its convertible promissory note from January 16, 2009 to January 19, 2010.  The extension of the maturity date has been accounted for as a modification to the original convertible promissory note.



As additional consideration for restructuring, the Company issued the holder of the convertible promissory note 5,200,000 share purchase warrants exercisable for common shares at $0.40 per share.  The expiry date of these warrants is the later of December 31, 2013 or the date which is two years after the note is fully repaid.





The note bears interest at 10% per annum and the holder of the convertible promissory note has the right to convert all or part of the note to common shares of the Company at a conversion price of $0.10 per share.



The note is secured by a security agreement under which the Company agreed to grant the lender security interest over all the Companys property and assets, including all intellectual property.



|                            |                       |                     
|--------------------------- | --------------------- | --------------------
|                            | At September 30, 2008 | At December 31, 2007
|Interest payable            | $362                  | $33,785             
|Convertible promissory note | 1,319,719             | 1,087,704           
|                            | $1,320,081            | $1,121,489          











Page7



---

CURRENT TECHNOLOGY CORPORATION

Notes to Interim Consolidated Financial Statements

For the nine months ended September 30, 2008 and 2007

Unaudited- (United States Dollars)





9.

Convertible Promissory Note (continued):



|                                        |  |              
|--------------------------------------- |  | -------------
|Volatility factor of the market         |  | 82.94%       
|Price of the Company shares             |  | $0.083- $0.42
|Dividend yield                          |  | 0%           
|Weighted average expiry date of options |  | 5 years      
|Risk free interest rate                 |  | 3.00%        



10.   Share Capital:



a)

Authorized 

Unlimited Common shares without par value



Unlimited Class A Preference shares without par value



b)

Issued and fully paid 





Options, warrants and convertible debt will have an anti-dilutive effect on loss per share





c)

Subscription Liability -



The Company received $37,500 for the private placement in which the underlying units has not been issued on September 30, 2008.



| |                                       |             |                   |             |             |  |  |  | 
| | ------------------------------------- | ----------- | ----------------- | ----------- | ----------- |  |  |  | 
| | September 30, 2008                    |             | December 31, 2007 |            
| | Number of                             |             | Number of         |            
| | Shares                                | Amount      | Shares            | Amount     
| | Balance, beginning                    | 103,892,023 | $25,787,959       | 80,872,023  | $24,649,659
| | Common Shares Issued -                |             |                   |             |            
| | - For cash                            | 29,975,000  | 3,995,000         | 21,750,000  | 1,087,500  
| | - For settlement of services
provided | 875,000     | 103,750           | 1,270,000   | 50,800     
| | - Exercise of options                 | -           | -                 | -           | -          
| | - Exercise of warrants                | 2,169,230   | 248,958           | -           | -          
| | Balance, ending                       | 136,911,253 | $30,135,667       | 103,892,023 | $25,787,959







d)

Loss per share -



For the nine months ended September 30

|                                              |              |             
|--------------------------------------------- | ------------ | ------------
|Loss per share                                | 2008         | 2007        
|Net loss                                      | $(3,339,449) | $(1,222,517)
|Loss available to common shareholders         | $(3,339,449) | $(1,222,517)
|Weighted average number of shares outstanding | 129,099,462  | 91,616,467  
|Basic and fully diluted loss per share        | $(0.0259)    | $(0.0133)   









Page8



---

CURRENT TECHNOLOGY CORPORATION

Notes to Interim Consolidated Financial Statements

For the nine months ended September 30, 2008 and 2007

Unaudited- (United States Dollars)





11.  Additional Paid-In Capital:



The Company accounts for its stock-based compensation under the fair value based method using the Black-Scholes Option Pricing Model.  $1,552,880 of compensation expense relating to vested stock options has been charged to the additional paid-in capital account.  Options granted during the period were valued using the following assumptions:



|                                        |  |                 
|--------------------------------------- |  | ----------------
|Volatility factor of the market         |  | 54.58% to 87.27%
|Price of the Company shares             |  | $0.09- $0.42    
|Dividend yield                          |  | 0%              
|Weighted average expiry date of options |  | 5 years         
|Risk free interest rate                 |  | 3.00%-3.44%     





12.

Stock Options:



From time to time, the Company grants incentive stock options to directors, officers, employees and promoters of the Company.  On September 2, 2004, the Company adopted the 2004 Stock Option and Stock Bonus Plan. Options outstanding on September 30, 2008 are as follows:



|            |                  |              |            |  |      
|----------- | ---------------- | ------------ | ---------- |  | -----
|Expiry Date | Number of Shares | Option Price
|            |                  |              |            |  |      
|September   | 30,              | 2009 *       | 200,000    |  | $0.30
|December    | 22,              | 2009         | 175,000    |  | $0.25
|December    | 23,              | 2009 *       | 100,000    |  | $0.25
|January     | 2                | 2011         | 375,000    |  | $0.31
|August      | 22               | 2011 *       | 200,000    |  | $0.19
|August      | 29               | 2012         | 1,000,000  |  | $0.08
|September   | 16               | 2012         | 7,495,000  |  | $0.09
|January     | 7                | 2013         | 5,000,000  |  | $0.15
|January     | 10               | 2013 **      | 12,500,000 |  | $0.14
|February    | 21               | 2013         | 1,050,000  |  | $0.20
|February    | 24               | 2013 ***     | 1,100,000  |  | $0.21
|July        | 3                | 2013 ****    | 600,000    |  | $0.23
|July        | 3                | 2013 ***     | 300,000    |  | $0.23
|July        | 3                | 2013 ***     | 100,000    |  | $0.23
|August      | 15               | 2013         | 600,000    |  | $0.32
|September   | 5                | 2013 ****    | 600,000    |  | $0.30





*

2004 Stock Option and Stock Bonus Plan



**

2004 Stock Option and Stock Bonus Plan

12.5 million vested on January 31, 2008, remainder vesting based on performance of Celevoke, Inc.



















Page9



---

CURRENT TECHNOLOGY CORPORATION

Notes to Interim Consolidated Financial Statements

For the nine months ended September 30, 2008 and 2007

Unaudited- (United States Dollars)





12.

Stock Options (continued):



|                                                                            |                                
|--------------------------------------------------------------------------- | -------------------------------
|Cumulative Net Pre-Tax Profit of Celevoke up to and including June 30, 2010 | Cumulative Options to be Vested
|$1,000,000                                                                  | 3,750,000                      
|$2,000,000                                                                  | 7,500,000                      
|$3,000,000                                                                  | 11,250,000                     
|$4,000,000                                                                  | 15,000,000                     
|$5,000,000                                                                  | 18,750,000                     
|$6,000,000                                                                  | 22,500,000                     
|$7,000,000                                                                  | 26,250,000                     
|$8,000,000                                                                  | 30,000,000                     
|$9,000,000                                                                  | 33,750,000                     
|$10,000,000                                                                 | 37,500,000                     





***

2004 Stock Option and Stock Bonus Plan

33% vested December 31, 2008

33% vested December 31, 2009

34% vested December 31, 2010

|                                                                                             |            |        
|-------------------------------------------------------------------------------------------- | ---------- | -------
|****
2004 Stock Option and Stock Bonus Plan

Vesting schedule:                               |           
|100,000 options on the completion of 1st 12 months of employment                            
|200,000 options on the completion of 2nd and 3rd years of employment                        
|Remaining 300,000 options tied to vesting schedule of performance based options listed below
|                                                                                             |            |        
|Cumulative pretax profit in Celevoke, Inc                                                    |           
|1st                                                                                          | $1,000,000 | 30,000 
|2nd                                                                                          | $1,000,000 | 30,000 
|3rd                                                                                          | $1,000,000 | 30,000 
|4th                                                                                          | $1,000,000 | 30,000 
|5th                                                                                          | $1,000,000 | 30,000 
|6th                                                                                          | $1,000,000 | 30,000 
|7th                                                                                          | $1,000,000 | 30,000 
|8th                                                                                          | $1,000,000 | 30,000 
|9th                                                                                          | $1,000,000 | 30,000 
|10th                                                                                         | $1,000,000 | 30,000 
|                                                                                             |            | 300,000

































Page10



---

CURRENT TECHNOLOGY CORPORATION

Notes to Interim Consolidated Financial Statements

For the nine months ended September 30, 2008 and 2007

Unaudited- (United States Dollars)





12.

Stock Options (continued):



The following table summarizes information about stock options to purchase common shares outstanding and exercisable at September 30, 2008:



|                       |            |                                  |           |                                 
|---------------------- | ---------- | -------------------------------- | --------- | --------------------------------
|                       |            | As at September 30,2008
Weighted |           | As at December 31, 2007
Weighted
|                       | Common     | Average                          | Common    | Average                         
|                       | Shares     | Exercise Price                   | Shares    | Exercise Price                  
|Outstanding, beginning | 9,545,000  | $0.12                            | 8,065,000 | $0.16                           
|- Granted              | 59,350,000 | 0.14                             | 8,675,000 | 0.31                            
|- Exercised            | -          | -                                | -         | -                               
|- Cancelled            | -          | -                                | 7,195,000 | -                               
|Outstanding, ending    | 68,895,000 | $0.14                            | 9,545,000 | $0.12                           
|Exercisable, ending    | 28,509,663 | $0.13                            | 9,545,000 | $0.12                           





The following table summarizes information about stock options outstanding and exercisable at September 30, 2008:

|               |       |                  |           |                 |          
|-------------- | ----- | ---------------- | --------- | --------------- | ---------
|               |       | Weighted Number  | Average   | Weighted Number
|               |       | Outstanding at   | Remaining | Outstanding    
|Exercise Price | 2008  | Contractual Life | 2007     
|               | $0.08 | 1,000,000        | 3.92      | years           | 1,000,000
|               | $0.09 | 7,495,000        | 3.96      | years           | 7,495,000
|               | $0.14 | 12,500,000       | 6.75      | years           | -        
|               | $0.15 | 5,000,000        | 4.27      | years           | -        
|               | $0.19 | 200,000          | 2.89      | years           | 200,000  
|               | $0.20 | 1,050,000        | 4.40      | years           | -        
|               | $0.21 | 257,020          | 4.41      | years           |          
|               | $0.23 | 90,976           | 4.75      | years           |          
|               | $0.30 | 200,000          | 1.00      | years           | 200,000  
|               | $0.25 | 275,000          | 1.23      | years           | 275,000  
|               | $0.31 | 375,000          | 2.26      | years           | 375,000  
|               | $0.32 | 66,667           | 4.93      | years           |          
|               |       | 28,509,663       |           |                 | 9,545,000





























Page11



---

CURRENT TECHNOLOGY CORPORATION

Notes to Interim Consolidated Financial Statements

For the nine months ended September 30, 2008 and 2007

Unaudited- (United States Dollars)





13.  Warrants:



The following table summarizes information about warrants outstanding on September 30, 2008:



|                   |                  |                |        |    
|------------------ | ---------------- | -------------- | ------ | ---
|Expiry Date        | Number of Shares | Exercise Price |       
|January 9, 2007    | 2,000,000        |                | $0.25  | 1,3
|January 9, 2007    | 2,980,000        |                | $0.10  | 1,3
|January 9, 2007    | 6,949,766        |                | $0.05  | 1,3
|January 9, 2007    | 179,167          |                | $0.15  | 1,3
|January 9, 2007    | 1,600,000        |                | $0.50  | 1,3
|June 30, 2009      | 2,500,000        |                | $0.05  | 3  
|June 15, 2009      | 1,000,000        |                | $0.15  | 3  
|June 15, 2009      | 1,517,696        |                | $0.20  | 5  
|July 15, 2009      | 200,000          |                | $0.20  | 5  
|January 2, 2010    | 3,200,000        |                | $0.25  | 2,3
|March 25, 2010     | 1,200,000        |                | $0.25  | 5  
|May 31, 2010       | 1,120,000        |                | $0.25  | 5  
|July 25, 2010      | 200,000          |                | $0.15  |    
|September 21, 2010 | 300,000          |                | $0.25  | 5  
|September 21, 2010 | 3,052,000        |                | $0.25  | 5  
|December 30, 2010  | 600,000          |                | $0.25  | 5  
|March 2, 2011      | 144,000          |                | $0.25  | 5  
|December 31, 2011  | 4,000,000        |                | $0.10  | 3,4
|February 12, 2012  | 2,350,000        |                | $0.125 | 6  
|March 30, 2012     | 11,850,000       |                | $0.10  | 5  
|April 30, 2012     | 5,000,000        |                | $0.12  | 3,7
|August 9, 2012     | 5,650,000        |                | $0.10  |    
|December 26, 2012  | 4,000,000        |                | $0.10  |    
|January 10, 2013   | 20,000,000       |                | $0.15  | 3  
|February 26, 2013  | 1,000,000        |                | $0.20  | 5  
|April 3, 2013      | 1,000,000        |                | $0.20  |    
|May 19, 2013       | 2,000,000        |                | $0.50  | 3  
|August 5, 2013     | 5,000,000        |                | $0.45  | 3  
|August 15, 2013    | 975,000          |                | $0.45  | 3  
|December 31, 2013  | 5,200,000        |                | $0.22  | 3,9



1

The expiry date for each set of warrants shall be the later of:

a)

January 9, 2007; and

b)

the date that is two years after the date on which the convertible promissory note (see Note 6) is paid in full.



2

The expiry date shall be the later of:

a)

January 2, 2010; and

b)

the date that is two years after the date on which the convertible promissory note (see Note 6) is paid in full.



3

These warrants have a cashless exercise provision.



4.

The expiry date shall be the later of:

a)

December 31, 2011; and

b)

the date that is two years after the date on which the convertible promissory note (see Note 6) is paid in full.



5.

The Company may accelerate the expiration date of the warrants if the average closing price equals or exceeds US$0.50 for 20 consecutive days.



6.

750,000 warrants are vested; 750,000 vest on sale of the 10th unit to Hair Envy, LLC; and 1,000,000 vest on the ordering of the 200th unit.





Page12



---

CURRENT TECHNOLOGY CORPORATION

Notes to Interim Consolidated Financial Statements

For the nine months ended September 30, 2008 and 2007

Unaudited- (United States Dollars)





13.

Warrants (continued):



7.

The warrants vest in increment of 500,000 based on the Companys portion of profit derived from the sale of Spy-N-TellTM units.  The Company must earn $11,500,000 from the joint venture in order for the 5 million warrants to be fully vested.



8.

The expiry date shall be the later of:

a)

December 31, 2012; and

b)

the date that is two years after the date on which the convertible promissory note (see Note 6) is paid in full.



9.

The expiry date shall be the later of:

a)

December 31, 2013; and

b)

the date that is two years  after the date on which the convertible promissory note (see Note 6) is paid in full.



The following table summarizes information about warrants to purchase common shares outstanding and exercisable at September 30:

|                       |             |                          |             |                        
|---------------------- | ----------- | ------------------------ | ----------- | -----------------------
|                       |             | As at
September 30,
2008 |             | As at December 31, 2007
|                       | Common      | Average                  | Common      | Average                
|                       | Shares      | Exercise Price           | Shares      | Exercise Price         
|Outstanding, beginning | 68,248,629  | $0.14                    | 35,675,758  | $0.18                  
|Issued                 | 35,175,000  | $0.18                    | 34,250,000  | $0.11                  
|Exercised              | (1,656,000) | $0.13                    | -           | -                      
|Expired                | -           | -                        | (1,677,129) | $0.49                  
|Outstanding, ending    | 101,767,629 | $0.14                    | 68,248,629  | $0.14                  
|Exercisable, ending    | 95,017,629  | $0.14                    | 61,498,629  | $0.14                  







14.

Related Party Transactions:



|     |                                                                                                                                                                                                                                         |          |          |  | 
|---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | -------- |  | 
|2008 | 2007                                                                                                                                                                                                                                   
|     | Transactions During the nine months ended September 30 -                                                                                                                                                                                |          |         
|     | Salaries and consulting fees accrued or paid to directors and                                                                                                                                                                           | $239,048 | $229,563
|     | companies controlled by directors of the Company

These transactions are in the normal course of operations and are measured at the exchange amount, which is the amount of consideration established and agreed to by related parties. |          |         
|     | Balance at September 30,2008 and December 31, 2007 -                                                                                                                                                                                    | 2008     | 2007    
|     | Salaries, consulting fees and other payable to directors and                                                                                                                                                                            |          |         
|     | companies controlled by directors of the Company                                                                                                                                                                                        | $ 25,000 | $ 39,992
|     |                                                                                                                                                                                                                                         |          |         



15.

Foreign Currency Risk:



The company has cash, accounts receivable, inventory, prepaid expenses and accounts payable and accrued liabilities denominated in foreign currency.  The carrying value of these balances may change due to the volatility of foreign exchange rates.  The Company does not enter into hedging transactions.









Page13



---

CURRENT TECHNOLOGY CORPORATION

Notes to Interim Consolidated Financial Statements

For the nine months ended September 30, 2008 and 2007

Unaudited- (United States Dollars)







16.

Segmented Information:



The major operations relate to the sales of GPS Telematics devices and services as well as sales and royalties charged on trichogenesis machines.



The revenue by region is as follows:

|             |                                         |                                        
|------------ | --------------------------------------- | ---------------------------------------
|             | For the nine months ended September 30, | For the nine months ended September 30,
|             | 2008                                    | 2007                                   
|Asia Pacific | $76,815                                 | $22,859                                
|Europe       | 13,793                                  | 130,764                                
|The Americas | 515,960                                 | 72,580                                 
|             | $606,568                                | $226,203                               



The majority of the Companys assets are located in the United States.



The Company has three major customers which accounted for approximately 70% of year to date revenue.





17.

Commitments:



An agreement was entered into to lease office space from May 1, 2005 to April 30, 2011.  The future minimum lease payments for this commitment are as follows:



|     |       
|---- | ------
|2008 | $7,772
|2009 | 31,088
|2010 | 34,048
|2011 | 11,843
|     |       



Lease agreements were entered into with respect to automotive and office equipment. The future minimum lease payments for these commitments are as follows:



|     |       
|---- | ------
|2008 | $6,822
|2009 | 20,559
|2010 | 9,560 
|2011 | 5,824 
|2012 | 3,155 
|2013 | 1,840 



























Page14



---

CURRENT TECHNOLOGY CORPORATION

Notes to Interim Consolidated Financial Statements

For the nine months ended September 30, 2008 and 2007

Unaudited- (United States Dollars)







18.

Subsequent Events:



a)

Acquisition



Subsequent to September 30, 2008, the Company purchased an additional 18 shares for a total of 148 shares for $600,000.  After the purchase of the 148 shares the Company owns 60% of the voting stock of Celevoke.

In addition to the $3,950,000 cash consideration, the Company issued the principals of Celevoke performance based options to purchase up to 50 million of the Companys shares at $0.14 per share, subject to the vesting provisions (12.5 million have been vested for period ended September 30, 2008) described in Note 12.

| |  | 
| |  | 
| |  | 

b)

Share Capital



On October 29, 2008, the Company issued 5,000,000 units at $0.14 per unit for total gross proceeds of $700,000.  Each unit consists of one common share and one warrant.  One warrant is exercisable into an additional common share for $0.25 expiring October 28, 2013.



19.

Differences between Canadian and United States Generally Accepted Accounting Principles:



The Company prepares its unaudited interim consolidated financial statements in accordance with US generally accepted accounting principles (US GAAP) which, as applied in these unaudited interim consolidated financial statements, conform in all material respects to Canadian generally accounting principles (Canadian GAAP), except for the differences below as follows:



(a)

Convertible Promissory Note 



(i)

Equity component of convertible promissory note



Under Canadian GAAP, the liability component of the convertible promissory note is calculated as the present value of the scheduled cash payments of interest and principal due under the terms of the note discounted at the rate of interest applicable to a debt only instrument of comparable terms. The equity component which represents the value ascribed to the holder's option to convert the principal balance into equity, and is calculated as the difference between the amount issued and the liability component.  Interest on the convertible promissory note, calculated as the amount required to accrete the liability component back to the amount payable on maturity, is charged to interest expense.



Under US GAAP, in accordance with APB Opinion No. 14 (APB 14), Accounting for Convertible Debt and Debt Issued with Stock Purchase Warrants, no portion of the proceeds from the issuance of convertible debt securities should be accounted for as attributable to the conversion feature.  Emerging Issue Task Force  98 (EITF 98-5), Accounting for Convertible Securities with Beneficial Conversion Features or Contingently Adjustable Conversion Ratios, requires the conversion feature to be separately valued only if the convertible debt securities with non-detachable conversion feature is issued in-the-money at the commitment date (beneficial conversion feature).  As a result of applying APB 14, there is no impact on the income statement because no accretion of interest had been recorded.











Page15



---

CURRENT TECHNOLOGY CORPORATION

Notes to Interim Consolidated Financial Statements

For the nine months ended September 30, 2008 and 2007

Unaudited- (United States Dollars)





19.

Differences between Canadian and United States Generally Accepted Accounting Principles: (Continued)



(ii)

Fair valuation of warrants



Under Canadian GAAP Section 3855,

when the Company issues warrants in connection with a debt instrument, the estimated fair market value of the warrants is credited to shareholders equity/(deficiency). The reduced liability component of the debt is accreted by a charge to interest expense.



Under US GAAP, underwriting, legal and other direct costs incurred in connection with the issuance of debt measured under the fair value option should be recognized in earnings and not deferred.  Underwriting, legal and other direct costs incurred in connection with the issuance of debt not measured under the fair value option should be presented as a deferred charge and not as a reduction in the carrying amount of the debt.



(b)

Stock Based Compensation 



On January 1, 2002, the Company adopted Canadian GAAP Handbook Section 3870 Stock-based Compensation and Other Stock-based Payments.  Under this section, the Company adopted the fair value based method for all employees and non-employees stock options.  The value is recognized over the applicable vesting period as an increase to compensation expense and contributed surplus.  When the options are exercised, the proceeds received by the Company, together with the amount in contributed surplus, will be credited to common share capital.  For options granted prior to January 1, 2002, the Company continues to follow the accounting policy under which no expense is recognized for these stock options.  When these options are exercised, the proceeds received by the Company are recorded as common share capital.



Under US GAAP, prior to January 1, 2002, the Company accounted for its employees stock options with the intrinsic value method under Accounting Principles Board Opinion 25, Accounting for Stock Issued to Employees (APB 25) as allowed by Statement of Financial Accounting Standard 123, Accounting for Share-Based Payments, (FAS 123).  APB 25 requires compensation cost for stock-based employee compensation plans to be recognized over the vesting period based on the difference, if any, between the quoted market price of the Companys stock as of the grant date and the amount employee must pay to acquire the stock.  Because the Company accounted for its employees stock options under APB 25, the Company separately disclosed pro forma information relating to the total compensation expense as required by FAS 123.



FAS 123 also establishes fair value as the measurement basis for transactions in which the Company acquires goods or services from non-employees in exchange for equity instruments.  All transactions in which goods or services are the consideration received for the issuance of equity instruments shall be accounted for based on the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable.  For all non-employees stock options issued prior to January 1, 2002 the Company accounted for fair value of these stock options using an option pricing model, as allowed by FAS 123.

















Page16



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CURRENT TECHNOLOGY CORPORATION

Notes to Interim Consolidated Financial Statements

For the nine months ended September 30, 2008 and 2007

Unaudited- (United States Dollars)









19.

Differences between Canadian and United States Generally Accepted Accounting Principles: (Continued)



Reconciliation of Net Loss -



The application of Canadian GAAP would have the following effects on the net income as reported:

|                                                                                |                                     |          |                                              |                                              |  |  |  |  |  |  |  |  | 
|------------------------------------------------------------------------------- | ----------------------------------- | -------- | -------------------------------------------- | -------------------------------------------- |  |  |  |  |  |  |  |  | 
|                                                                                |                                     |          | For the nine months ended September 30,
2008 | For the nine months ended September 30, 2007 | 
|                                                                                | Loss for the period - US GAAP       |          | $(3,339,449)                                 | $(1,222,517)                                 | 
|Adjustment for accretion interest  equity component of convertible debt (a(i)) |                                     | (58,529) | (135,903)                                    |                                             
|Adjustment for accretion interest  fair valuation of warrants (a(ii))          |                                     | 584,872  | (78,681)                                     |                                             
|                                                                                |                                     |          |                                              |                                             
|                                                                                | Loss for the period - Canadian GAAP |          | $(2,813,106)                                 | $(1,437,101)                                 | 



Net Loss per Share -



The net loss per share computed under US GAAP is different from the net loss per share computed under Canadian GAAP due to differences noted in the accounting for convertible debt.  The adjusted basis loss per share under Canadian GAAP is as follows:



|             |                                     |                                               |              |                                          |                    |          |  |  |  |  |  | 
|------------ | ----------------------------------- | --------------------------------------------- | ------------ | ---------------------------------------- | ------------------ | -------- |  |  |  |  |  | 
|             |                                     |                                               |              | September 30, 2008                       | September 30, 2007
|             |                                     | Weighted Average Number of Shares Outstanding |              | 129,099,462                              | 91,616,467        
|             | US GAAP and Canadian GAAP          
|             |                                    
|             |                                    
|             |                                     |                                               |             
|             | Loss for the period - Canadian GAAP |                                               | $(2,813,106)
|$(1,437,101) |                                     |                                               |              | Basic loss per share under Canadian GAAP |                    | (0.0218)
|(0.0157)     |                                     |                                               |              |                                         



The application of Canadian GAAP would have the following effects on the consolidated balance sheet items as reported under US GAAP:



|                                                                             |                    |                 
|---------------------------------------------------------------------------- | ------------------ | ----------------
|                                                                             | September 30, 2008 | December 31,2007
|Liabilities - US GAAP                                                        | $1,943,606         | $1,468,432      
|Adjustment for unamortized portion of equity component of convertible        |                    |                 
|promissory note (a(i))                                                       | (58,041)           | (77,538)        
|Adjustment for unamortized portion of the fair valuation of warrants (a(ii)) | (725,205)          | (140,332)       
|                                                                             |                    |                 
|Liabilities - Canadian GAAP                                                  | $1,160,360         | $1,250,562      











Page17



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CURRENT TECHNOLOGY CORPORATION

Notes to Interim Consolidated Financial Statements

For the nine months ended September 30, 2008 and 2007

Unaudited- (United States Dollars)





19.

Differences between Canadian and United States Generally Accepted Accounting Principles: (Continued)





|                                                           |                    |                  
|---------------------------------------------------------- | ------------------ | -----------------
|                                                           | September 30, 2008 | December 31, 2007
|Shareholders Equity (Deficiency)- US GAAP                 | $2,117,385         | $(1,278,059)     
|Effect of equity component  of convertible promissory note | 469,657            | 430,719          
|Cumulative effect of prior year adjustments to net loss    | (463,849)          | (201,304)        
|Cumulative effect of current year adjustments to net loss  | (157,763)          | (262,545)        
|Effect of fair valuation of warrants                       | 935,200            | 251,000          
|                                                           |                    |                  
|Shareholdersequity / (deficiency) - Canadian GAAP         | $2,900,630         | $(1,060,189)     



The following presents the conversion of the Companys comparative financial information from Canadian dollars and Canadian GAAP to US dollars and US GAAP:



a)

Balance sheet at December 31, 2007



|                                         |  |                 |                 |  |  | 
|---------------------------------------- |  | --------------- | --------------- |  |  | 
|                                         |  | As previously   | As restated    
|                                         |  | reported        |                
|                                         |  | Canadian        | US GAAP        
|                                         |  | GAAP            |                
|                                         |  | CDN$            | US$            
|                                         |  |                 |                
|Assets                                   |  |                 |                
|Current:                                 |  |                 |                
|Cash                                     |  | $        33,601 | $        33,498
|Accounts receivable                      |  | 27,701          | 27,617         
|Inventory                                |  | 62,112          | 61,920         
|Prepaid expenses                         |  | 17,984          | 17,926         
|Subscription receivable                  |  | 49,565          | 49,412         
|                                         |  |                 |                
|Total assets                             |  | $      190,963  | $      190,373 
|                                         |  |                 |                
|Liabilities and Shareholders' Deficiency |  |                 |                
|Current:                                 |  |                 |                
|Accounts payable and accrued liabilities |  | $      348,019  | $      346,943 
|Subscription liability                   |  | 27,984          | -              
|                                         |  |                 |                
|Total current liabilities                |  | 376,003         | 346,943        
|Convertible promissory note              |  | 888,710         | 1,121,489      
|                                         |  |                 |                
|                                         |  | 1,264,713       | 1,468,432      





Page18



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CURRENT TECHNOLOGY CORPORATION

Notes to Interim Consolidated Financial Statements

For the nine months ended September 30, 2008 and 2007

Unaudited- (United States Dollars)







|                                                                                                                                   |  |                |                |  |  | 
|---------------------------------------------------------------------------------------------------------------------------------- |  | -------------- | -------------- |  |  | 
|19.
Differences between Canadian and United States Generally Accepted Accounting Principles: (Continued)

Shareholders' Deficiency
|Subscription liability                                                                                                             |  | -              | 27,898        
|Equity component of convertible promissory note                                                                                    |  | 501,562        | -             
|Share capital                                                                                                                      |  | 35,525,626     | 25,787,959    
|Contributed surplus                                                                                                                |  | 2,697,682      | 1,865,581     
|Deficit                                                                                                                            |  | (39,798,620)   | (28,660,295)  
|Accumulated other comprehensive loss                                                                                               |  | -              | ( 299,202)    
|Total shareholders' deficiency                                                                                                     |  | (1,073,750)    | (1,278,059)   
|                                                                                                                                   |  |                |               
|                                                                                                                                   |  | $      190,963 | $      190,373



b)

Statement of operations and deficit for the nine months ended September 30, 2007

|                                                             |  |                      |                       
|------------------------------------------------------------ |  | -------------------- | ----------------------
|                                                             |  | As previously        | As restated           
|                                                             |  | reported             |                       
|                                                             |  | Canadian             | US GAAP               
|                                                             |  | GAAP                 |                       
|                                                             |  | CDN$                 | US$                   
|Revenue                                                      |  | $            249,909 | $              226,206
|Cost of Sales                                                |  | 232,712              | 210,640               
|                                                             |  |                      |                       
|                                                             |  | 17,197               | 15,566                
|Selling, General and Administrative Costs and Expenses       |  |                      |                       
|                                                             |  |                      |                       
|General & Administrative                                     |  | 264,746              | 239,636               
|Salaries & Wages                                             |  | 555,479              | 502,795               
|Legal, auditing and filing fees                              |  | 224,676              | 203,367               
|Consulting                                                   |  | 347,481              | 314,524               
|Interest on convertible promissory note                      |  | 84,045               | 76,074                
|Corporate communications                                     |  | 70,879               | 64,156                
|Foreign exchange (recovery)                                  |  | (179,492)            | (162,469)             
|Total Selling, General and Administrative Costs and Expenses |  | 1,367,814            | 1,238,083             
|Loss before other items                                      |  | 1,350,617            | (1,222,517)           
|Other Items:                                                 |  |                      |                       
|Accretion interest expense                                   |  | 362,011              | -                     
|                                                             |  | 362,011              | -                     
|Net loss                                                     |  | (1,712,628)          | (1,222,517)           
|Deficit, beginning                                           |  | 37,998,964           | (27,112,143)          
|Deficit, ending                                              |  | $     39,711,592     | $       (28,334,660)  
|                                                             |  |                      |                       
|Basic and diluted loss per common share                      |  | $             (0.01) | $             (0.0133)





Page19



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CURRENT TECHNOLOGY CORPORATION

Notes to Interim Consolidated Financial Statements

For the nine months ended September 30, 2008 and 2007

Unaudited- (United States Dollars)







| |  |  | 
| |  |  | 





19.

Differences between Canadian and United States Generally Accepted Accounting Principles: (Continued)



c)

Statement of cash flows for the nine months ended September 30, 2007

|                                                  |  |               |                  | 
|------------------------------------------------- |  | ------------- | ---------------- | 
|                                                  |  | As previously | As restated     
|                                                  |  | reported      |                 
|                                                  |  | Canadian      | US GAAP         
|                                                  |  | GAAP          |                 
|                                                  |  | CDN$          | US$             
|                                                  |  |               |                 
|                                                  |  |               |                 
|Operating Activities:                             |  |               |                 
|Net loss                                          |  | $(1,712,628)  | $ $ $(1,222,518)
|Adjustments for -                                 |  |               |                 
|Accretion interest of convertible debt            |  | -             | -               
|Interest expense                                  |  | -             | (76,074)        
|Stock-based compensation                          |  | 573,842       | 519,415         
|Exchange adjustment                               |  | -             | 908             
|                                                  |  |               |                 
|Changes in non-cash working capital -             |  |               |                 
|(Increase) Decrease in accounts receivable        |  | (50,320)      | (45,547)        
|(Increase) Decrease in inventory                  |  | (32,653)      | (29,556)        
|(Increase) Decrease in deferred financing cost    |  | -             | -               
|(Increase) Decrease in prepaid expenses           |  | 52,744        | 47,741          
|(Increase) Decrease in subscription receivable    |  | (49,740)      | (45,022)        
|Increase (Decrease) in accounts payable           |  | (119,296)     | (107,981)       
|Increase (Decrease) in unearned revenue           |  | 69,913        | 63,282          
|Cash flows (used in) Operating activities         |  | (1,268,138)   | (895,352)       
|                                                  |  |               |                 
|Financing Activities:                             |  |               |                 
|Convertible promissory note                       |  | 269,986       | -               
|Issuance of new shares                            |  | 1,052,091     | 947,372         
|Subscription liabilities                          |  | (68,913)      | (62,377)        
|Cash flows from financing activities              |  | 1,253,164     | 884,995         
|                                                  |  |               |                 
|Net Increase (Decrease) in Cash during the period |  | (14,974)      | (10,357)        
|Cash, beginning of the period                     |  | 51,973        | 45,085          
|Cash, ending of the period                        |  | $   36,999    | $    34,728     













Page20









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ITEM 2. Managements Discussion and Analysis of Financial Condition and Results of Operations.



Cautionary Statement about Forward-Looking Statements



Certain statements contained in this 10-Q that are not historical facts constitute forward-looking statement within the meaning of the Private Securities Litigation Reform Act of 1995, and are intended to be covered by the safe harbors created by that Act.  Reliance should not be placed on forward-looking statements because they involve known and unknown risks, uncertainties, and other factors, which may cause actual results, performance, or achievements to differ materially from those expressed or implied.  All statements, other than statements of historical facts, included in this report that address activities, events, or developments that our management expects, believes, hopes or anticipates will or may occur in the future are forward looking statements.  Any forward-looking statements speak only as of the date made.  We undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date on which they are made.



Plan of Operation



Telematics Technology



On January 31, 2008, Current Technology Corporation (the Company or we) entered into a securities purchase agreement with Celevoke, Inc (Celevoke).  Under the agreement we were obligated to purchase 102 shares of Celevoke common stock in five installments for an aggregate purchase price of $2.5 million.We completed the acquisition on May 23, 2008 by making the final installment payment.  On August 13, 2008 we purchased an additional 25 shares of Celevoke for $750,000; on September 29, 2008 we purchased an additional 3 shares for $100,000; and on October 28, 2008 we purchase an additional 18 shares of Celevoke for $600,000.  As of the date of this Form 10-Q we own 60% of the outstanding shares of Celevoke.



Celevoke is a distributor of proprietary global positioning system (GPS) based Telematics products developed by LunarEYE.  The technology utilizes the integrated use of telecommunications and informatics to enable users to remotely monitor, track, control and protect a wide variety of asset classes such as, automobiles, and other motorized vehicles, shipping containers, covert vehicles used for law enforcement, and even people.  This technology is referred to as Telematics.  We believe that Celevoke has a number of attributes that may lead to success in the marketplace, including its technology and products, its non-exclusive worldwide license with the patent holder, a functioning network operations center and established relationships with a number of channels of distributions.  We are hopeful that Celevokeis poised to become a market leader in the global market for Telematics, which some third parties project to be a $38.3 billion industry by 2011.



To facilitate the Celevoke transaction, on January 10, 2008 we entered into a securities purchase agreement with MSGI Securities Solutions Inc. ("MSGI") whereby MSGI agreed to purchase 25 million Company units at a price of $0.10 per unit for a total of $2.5 million, payable in accordance with a prescribed installment time-line. As partial consideration for the $2.5 million investment which was to be paid on a pre-determined time line, we agreed to negotiate additional agreements.  None of these ancillary agreements were finalized and the last $500,000 payment was not made by MSGI.  However, we continue to explore and maintain a business relationship with MSGI.  On May 23, 2008, the Company raised









---





$500,000 through a separate third party and used the funds to make the final $500,000 payment to complete the Companys acquisition of its 51% interest in Celevoke.



During the quarter ended September 30, 2008 and through the period to the date of this report, the Company, through Celevoke, continued to focus on the development and promotion of Celevokes GPS-based asset tracking technology.  Celevoke conducts certain of its business activities in South America/Brazil through its 51% subsidiary StarOne Telematica SA (StarOne).  The activities of the Company and its affiliated entities during the quarter, and subsequently, included:



·

In September 2008, Celevoke expanded its management team and appointed new persons to serve in management level sales positions.



·

Celevoke completed a $500,000 upgrade and launched its new expanded and enhanced Network Operations Center.  The new data center offers Celevoke and its partners increased storage and power capabilities.



·

Celevoke expanded its sales force and appointed the Mitchell Group Consulting of Austin, Texas as its marketing agency of record.



·

In November 2008 Celevoke attended and presented its technology at the Specialty Equipment Market Association (SEMA) in Las Vegas.



·

StarOne entered into a commercial distribution agreement withMagneti Marelli Sistemas Automotivos Indústria e Comércio Ltda. of Brazil, a subsidiary of Magneti Marelli of Milan, Italy.



·

Marketing Celevokes GPS/Asset protection devices through 20thCentury Fox Federal Credit Union.



·

StarOne closed contracts for the provision of tracking services with a contract value of over 990,000 Brazilian Reals (approximately $550,000 USD at the exchange rates of the time) for the first three months of effective operations to September 30, 2008.  In addition during October, the Company closed contracts with a total contract value of 1,900,000 Brazilian Reals. In November, contracts with a value of 2.0 million Brazilian Reals are in the process of being closed and the Company anticipates a further 2.0 million Brazilian Reals in contract value will be closed by the end of the month.



TrichoGenesis Platform Products



Historically our operations have focused on hair restoration and re-growth related products.  We have developed an electrotherapeutic medical device designed to stimulate hair regrowth (ElectroTrichoGenesis or ETG) and a cosmetic unit designed to improve the appearance of thinning hair (CosmeticTrichoGenesis or CTG).  ETG and CTG are marketed as TrichoGenesis platform products.  We own patents to the technology, methodology and design of these products.  ETG Treatment, the regrowth of hair by means of electrical stimulation, is believed to promote the healing of hair follicles that are dormant, but not dead. Research has been conducted to expand the indications for ETG.









---





The CTG Mark 5 is a product for improving the appearance of thinning hair.  Using the TrichoGenesis technology platform, this product was developed specifically for the United States marketplace.



The Company has entered into an exclusive distribution agreement with an entity based in the United States for the placement on a revenue sharing basis of its TrichoGenesis platform products in the United States, Canada, South America (excluding Brazil), Europe and Russia. The Company is working in concert with its United States based distributor to attempt to lower the cost of ETG devices and CTG units by having non-proprietary components of the chair and hood manufactured in China.   In June 2008 the Company inspected and approved the final prototype which was manufactured in China.  The last step prior to commencement of ongoing manufacturing in China was a factory inspection to be conducted by Canadian Standards Association International as part of its certification process.  The inspection was completed during October, 2008, and the Company believes certificates confirming the approval should be issued during November, 2008.



Going forward the Company expects that it will primarily focus on developing and promoting the Celevokes GPS based asset-tracking technology and products.  However, the Company has no immediate plans to discontinue its efforts to develop and promote our TrichoGenesis products and technologies.



Results of Operation



On May 23, 2008 we became the majority holder of the voting equity of Celevoke.  On that day the Company began consolidating Celevokes financial results in the Companys interim consolidated financial statements.  Accordingly, the financial statements included with this quarterly report for the three and nine month periods ending September 30, 2008 are presented on a consolidated basis with Celevoke and its subsidiary StarOne.  Prior to the filing of our quarterly report for the quarter ended June 30, 2008 our financial statements were not presented on a consolidated basis with Celevoke (including our annual report on Form 20-F for the year ended December 31, 2007).   As such, the information presented in our financial statements included with this quarterly report may not provide a meaningful comparison when compared against the financial statements for three and nine month periods ending September 30, 2007.  However, we believe that as a result of the Companys activities to date aimed to promote and develop its business operations through Celevoke (as described in the Plan of Operations section of this Form 10-Q) that the Companys revenues going forward will likely be at or above the revenues reported during our quarter ended September 30, 2008.  Further, we expect that certain of our operation costs will decrease over time as the Companys business through Celevoke becomes more established and certain expenses, such as business development, are reduced.



As of September 30, 2008 we had working capital of $249,924, as compared to a working capital deficit of $156,570 at December 31, 2007. The increase in our working capital is primarily the result of the assets reported on our balance sheet now being presented on a consolidated basis with Celevokes assets.  Celevokes assets comprised a significant portion of the assets reported on our balance sheet, as Celevokes current assets as of September 30, 2008 included $202,592 in accounts receivable and $253,633 in inventory.  However, the Company has also assumed certain of Celevokes liabilities which are now included in the Companys consolidated balance sheet which as of September 30, 2008 included $323,625 in accounts payable and accrued liabilities.  Our working capital decreased during the quarter ended September 30, 2008 by $210,395 from June 30, 2008 in large part as a result of  a $241,898









---





decrease in our cash and cash equivalent assets on a consolidated basis as these assets were primarily used by Celevoke and StarOne to fund their on-going business operations and activities.



As of September 30, 2008 we had shareholders equity of $2,117,385, as compared to a shareholders deficiency of ($1,278,059) from December 31, 2007.  This increase was primarily caused by the additional paid in capital and the increase in common shares. The increase in common shares was primarily the result of the private placements of equity securities that have occurred since December 31, 2007 to help fund our acquisition of our equity interest in Celevoke and the exercise of warrants.  The additional paid in capital was primarily as a result of stock options issued to directors and employees of the Company as well as to the principals of Celevoke and the issuance of warrants related to the modification of the convertible promissory note.



Revenue for the nine months ended September 30, 2008 was $613,674 as compared to $226,206 for the comparable period in 2007.  Further, for the quarter ended September 30, 2008 our revenue totaled $258,946 as compared to $23,082 during the third quarter of fiscal 2007.  The majority of the Companys revenues (approximately 75%) for the nine month period ended September 30, 2008 were generated through the sale and distribution of Celevokes GPS based technology.  In comparison, the Companys revenues for the comparable period in 2007 were generated entirely through the sale and distribution of our TrichoGenesis products.   Accordingly, we do not believe that a comparison of our revenue numbers for the 2008 periods should be compared against those for the 2007 periods as a manner to evaluate the results of the Companys operations.  With our focus now primarily on Celevokes business operations, we do not expect our TrichoGenesis products to generate significant revenues for the Company (if any) during the balance of 2008.



For the nine months ended September 30, 2008, the Company experienced a net loss of ($3,339,449) (including non-cash expenses of $1,291,530) or $(0.0259) per share, compared to a net loss of $(1,222,517) (including non-cash expenses of $510,789) or $(0.0133) per share during the comparable period in the previous year.  For the quarter ended September 30, 2008 the Company experienced a loss of $(1,829,460) including non-cash expenses of $873,753) as compared to $(804,899) (including non-cash expenses of $510,789) for the comparable quarter in fiscal 2007. The significant increases in our loss for the three and nine month periods ending September 30, 2008 were a result of the increased costs we have realized on a consolidated basis as a result of acquisition of a majority of Celevokes outstanding equity.  During the nine months ended September 30, 2008 we, through Celevoke, incurred significantly higher expenses on a consolidated basis than we did during the comparable period in 2007.  For example, we incurred a total of $959,083 (including $684,200 of non-cash expense related to the issuance of warrants for the modification of the convertible promissory note) in general and administrative expenses for the nine month period ended September 30, 2008 as compared to $239,636 in 2007.  We incurred $500,250 in business development expenses in the nine months ended September 30, 2008 as compared to no such business development costs in 2007; most of these increased costs were incurred by Celevoke (and its subsidiary Star One) during the quarter ended June 30, 2008 to continue to develop and promote its business operations and its GPS-based technology.



We are optimistic that through our acquisition of 60% of Celevoke we will increase the amounts of revenues generated by the Company.  However, we cannot guarantee that the business activities conducted through Celevoke will ultimately be successful in generating the revenues.











---





Liquidity and Capital Resources



Since inception the Company has primarily financed its operations through the sale of equity and debt securities.  However, we have generated limited amounts of revenues from sales of our TrichoGenesis products.  Further, starting in the quarter ended June 30, 2008 we began recognizing revenues generated through Celevoke.



As of September 30, 2008 we had cash and cash equivalents of $381,614 on a consolidated basis.  To September 30, 2008 the Company has raised $4,203,731 through the sale of equity securities and upon the exercise of warrants.  However, of these funds an aggregate of $3,350,000 was used to fund the acquisition of our equity interest in Celevoke.  Through the end of our fiscal year we expect to continue to experience a net loss from operations and thus continue to expend our existing cash resources to fund our operations and business activities.



We expect that with our current resources on-hand and the proceeds from the offerings conducted by the Company to be sufficient to cover our costs through December 2008.  However, estimates for expenses may change in which case our capital would not be sufficient for this time period. Further, we may determine it is appropriate to raise additional capital for working capital and general corporate purposes. If we need, or elect, to obtain additional debt or equity financing, but there can be no assurance that additional financing will be available on reasonable terms, if at all.  Further, as a result of on-going recent volatility in the capital markets it may be increasingly difficult for us to obtain additional debt or equity financing.  We believe that the ability of the Company to continue as a going concern is dependent on the successful conclusion of these discussions and/or negotiations, the receipt of additional financing and/or proceeds on the sale of assets and ultimately its ability to generate sufficient cash from operations and financing sources to meet obligations as they come due.



ITEM 3. Quantitative and Qualitative Disclosures About Market Risk



Not applicable



ITEM 4. CONTROLS AND PROCEDURES



Disclosure Controls and Procedures

The Company's principal executive officer and principal financial officer have evaluated the effectiveness of the Company's disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report. Based on that evaluation, our principal executive officer and our principal financial officer have concluded that our disclosure controls and procedures were not effective as of September 30, 2008 because of the identification of material weaknesses in our internal control over financial reporting which are identified in Item 9A(T) included with our Annual Report on Form 20-F, as amended, for the year ended December 31, 2007, which we view as an integral part of our disclosure controls and procedures. Depending on our financial resources we hope to take appropriate actions to remediate any such material weaknesses identified.









---





Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commissions rules and forms.  Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and our principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.



Internal Control Over Financial Reporting



There was no change in the Company's internal control over financial reporting that occurred during the fiscal quarter to which this report relates that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.















---





PART II  OTHER INFORMATION





ITEM 1. Legal Proceedings



None.



Item 1A. Risk Factors



There have been no material changes to the information included as risk factors set forth in our Annual Report on Form 20-F for the year ended December 31, 2007 or in our Quarterly Report on Form 10-Q, as amended, for the quarter ended June 30, 2008.



Item 2.  Unregistered Sales of Equity Securities



1.

On July 2, 2008 pursuant to the Companys 2004 Stock Option and Stock Bonus Plan (the Plan) the Company issued three new employees of Celevoke Inc. options to purchase our common stock exercisable at $0.23 per share or on a cashless basis as provided by the Plan.  The options vest over a three year period with certain of the options only vesting upon Celevokes achievement of certain cumulative net pre-tax profit objectives.  The options were granted in consideration for each person agreeing to become a Celevoke employee and for services to be rendered in the recipients capacity as employees. To the extent these option grants constituted sales of securities we relied on the exemption from registration provided by Section 4(2) under the Securities Act of 1933 for the grants because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to each recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; and (iii) believed that for each grant the recipients obtained all information regarding the Company he requested (or believed appropriate) and received answers to all questions he (and their advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes. No commissions or other remuneration was paid in connection with these option grants.

2.

On August 15, 2008 the Company issued an employee of the Company options to purchase our common stock exercisable at $0.32 per share or on a cashless basis.  50,000 of the options vested immediately upon grant, 50,000 vest on December 31, 2008 and the remaining 500,000 vest at the discretion of the Companys chief executive officer.  The options were granted in consideration for the recipient agreeing to become a Company employee and for services to be rendered in his capacity as an employee. To the extent this option grant constituted a sale of securities we relied on the exemption from registration provided by Sections 4(2) under the Securities Act of 1933, and Rule 506 promulgated thereunder for the grant because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to the recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; (iii) believed that the recipient obtained all information regarding the Company he requested (or believed appropriate) and received answers to all questions he (and his advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes; and (iv)  believed that









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the recipient is an accredited investor.  No commissions or other remuneration was paid in connection with these option grants.



3.

On September 4, 2013 pursuant to the Plan the Company issued an employee of Celevoke Inc. 600,000 options to purchase our common stock exercisable at $0.30 per share or on a cashless basis.  100,000 of the options vest at the completion of the first year of employment, 200,000 vest monthly on a pro-rate basis over the subsequent two year term, and 300,000 vest upon Celevokes achievement of certain cumulative net pre-tax profit objectives.  To the extent this option grant constituted a sale of securities we relied on the exemption from registration provided by Sections 4(2) under the Securities Act of 1933, and Rule 506 promulgated thereunder for the grant because we: (i) did not engage in any public advertising or general solicitation in connection with the grants; (ii) made available to the recipient disclosure regarding all aspects of our business including our reports filed with the SEC and our press releases, and other financial, business, and corporate information; (iii) believed that the recipient obtained all information regarding the Company he requested (or believed appropriate) and received answers to all questions he (and his advisors) posed, and otherwise understood the risks of accepting our securities for investment purposes; and (iv)  believed that the recipient is an accredited investor.  No commissions or other remuneration was paid in connection with these option grants.

4.

On November 3, 2008 the Company issued an accredited investor 5,000,000 Company units at $0.14 per unit.  Each unit consists of one common share and one warrant exercisable at $0.25 until October 28, 2013. The Company received proceeds of $700,000 for the sale of the units.  We relied on the exemptions from registration provided by Section 4(2) and Section 4(6) of the Securities Act of 1933, and Rule 506 promulgated thereunder for this issuance.  No commissions or other remuneration were paid in connection with this issuance.



B.

The following sets forth the information required by Item 701 of Regulation S-K with respect to the unregistered sale of equity securities that occurred prior to September 30, 2008 and have not been previously disclosed.



1.

On February 22, 2008 we issued accredited investors 600,000 shares of common stock to retire a debt obligation.  Although the Company did not receive cash consideration for the shares we received relief of $60,000 in indebtedness.   The shares were issued in reliance on Sections 4(2) and 4(6) of the Securities Act of 1933, as amended.  No commissions or other remuneration were paid in connection with this issuance.



Item 3.  Default Upon Senior Securities



None.



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





On September 26, 2008 we held our annual meeting of shareholders in Vancouver, British Columbia.   Four proposals were submitted to the shareholders for approval as set forth in our proxy statement dated









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August 26, 2008.   90,278,141 shares were present at the meeting in person or by proxy and constituted a quorum.   At the meeting our shareholders elected the following persons as directors, with the votes being cast as follows:



|                 |            |                
|---------------- | ---------- | ---------------
|Name of Director | Shares FOR | Shares WITHHELD
|Robert Kramer    | 90,240,536 | 37,610         
|Peter Bell       | 90,266,086 | 12,060         
|Anthony Harrison | 90,246,086 | 32,060         
|Douglas Beder    | 90,265,586 | 12,560         
|George Chen      | 90,245,586 | 32,560         



Our shareholders also approved amendments to our 2004 Stock Option and Stock Bonus Plan increasing the shares reserved under that plan to 55 million shares, with the votes being cast as follows:



|           |                |           
|---------- | -------------- | ----------
|Shares FOR | Shares AGAINST | ABSTAINED 
|54,254,578 | 461,415        | 35,562,153



Our shareholders also approved the appointment of HLB Cinnamon Jang Willoughby & Company, as our independent auditing firm, with the votes being cast as follows:



|           |                |          
|---------- | -------------- | ---------
|Shares FOR | Shares AGAINST | ABSTAINED
|90,273,321 | 0              | 4,825    



Finally, our shareholders approved the Companys granting of incentive stock options outside of the Companys 2004 Stock Option and Stock Bonus Plan, with the votes being cast as follows:



|           |                |           
|---------- | -------------- | ----------
|Shares FOR | Shares AGAINST | ABSTAINED 
|54,254,078 | 461,915        | 35,562,153



Item 5. Other Information



None.



Item 6.  Exhibits



|     |  |                                                         
|---- |  | --------------------------------------------------------
|     |  |                                                         
|3.1  |  | Articles of Continuance (1).                            
|     |  |                                                         
|3.2  |  | Bylaws (2).                                             
|     |  |                                                         
|10.1 |  | Forbearance Agreement, Third Modification Agreement. (3)
|     |  |                                                         









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|     |  |                                                                                                                                                             
|---- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.2 |  | Amended and Restated Note (3)                                                                                                                               
|     |  |                                                                                                                                                             
|31.1 |  | Certification of CEO Pursuant to Exchange Act Rules 13a-14 and 15d-14, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.
|     |  |                                                                                                                                                             
|31.2 |  | Certification of CFO Pursuant to Exchange Act Rules 13a-14 and 15d-14, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.
|     |  |                                                                                                                                                             
|32.1 |  | Certification of CEO and CFO Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith.      







(1)

Incorporated by reference from the Companys annual report on Form 20-F dated December 31, 2003 and

filed with the Securities and Exchange Commission on July 8, 2004.



(2)

Incorporated by reference to the Companys Form 20-F, dated December 31, 2004 and filed July 7, 2005.



(3)

Incorporated by reference to the Companys Current Report on Form 8-K dated September 29, 2008 and

filed October 14, 2008.





SIGNATURES



In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.





Date: November 19, 2008

By: /s/ Robert Kramer

Robert Kramer,

Principal Executive Officer



Date: November 19, 2008

By:/s/ George Chen

George Chen,

Principal Financial Officer and

Principal Accounting Officer