UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

      |X| ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
        EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2005

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

                         Commission file number 0-27419

                     AMERICAN SECURITY RESOURCES CORPORATION
-------------------------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)
-------------------------------------------------------------------------------

                  Nevada                                 90-0179050
(State or other jurisdiction               (I.R.S. Employer Identification No.)
of incorporation or organization)

         9601 Katy Freeway, Suite 220               Houston, Texas       77024
-------------------------------------------------------------------------------
         (Address of principal executive offices)                    (Zip Code)

       Registrant's telephone number, including area code: (713) 465-1001
                                                           --------------


        Securities registered pursuant to Section 12(b) of the Act: None
                                                                    ----

           Securities registered pursuant to Section 12(g) of the Act:
                          $.001 Par Value Common Stock

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

         Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B is not contained in this form, and no disclosure will
be contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [X]

         Issuer's revenues for the fiscal year ended December 31, 2005, were
$0.00.

         The aggregate market value of the voting and non-voting common equity
held by non-affiliates of the Issuer as of December 31, 2005 based upon the
average bid and asked price as of such date on the OTC Bulletin Board was
$8,672,654.

         The Registrant's common stock outstanding as of December 31, 2005 was
61,700,766 shares.


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


<PAGE>


                     AMERICAN SECURITY RESOURCES CORPORATION

                              INDEX TO FORM 10-KSB
                                December 31, 2005
<TABLE>
                                                                                              Page No.
<S>           <C>                                                                             <C>
Part I        Item 1.      Description of Business                                                3
              Item 2.      Description of Property                                                6
              Item 3.      Legal Proceedings                                                      6
              Item 4.      Submission of Matters to a Vote of Security Holders                    6

Part II       Item 5.      Market for Common Equity and Related Stockholder Matters               7
              Item 6.      Management's Discussion and Analysis and Results of
                               Operations and Financial Condition                                 8
              Item 7.      Financial Statements                                                  11
              Item 8.      Changes in and Disagreements with Accountants on
                               Accounting and Financial Disclosure                               21
              Item 8A.     Controls and Procedures                                               21

Part III      Item 9.      Directors, Executive Officers, Promoters and Control Persons,
                               Compliance with Section 16(a) of the Exchange Act                 21
              Item 10.     Executive Compensation                                                23
              Item 11.     Security Ownership of Certain Beneficial Owners and
                               Management                                                        24
              Item 12.     Certain Relationships and Related Party Transactions                  25
              Item 13.     Principal Accountant Fees and Services                                25

Part IV       Item 14.     Exhibits and Reports on Form 8-K                                      26
                           Exhibit 14A - Form of Warrant Agreement                               28
                           Exhibit 14B - Employment Agreement Joe Grace                          34
                           Exhibit 14H - Code of Ethics                                          37
</TABLE>

         Some of the statements contained in this report discuss future
         expectations, contain projections of results of operations or financial
         condition, or state other "forward-looking" information. The words
         "believe," "intend," "plan," "expect," "anticipate," "estimate,"
         "project" and similar expressions identify such statement was made.
         These statements are subject to known and unknown risks, uncertainties,
         and other factors that could cause the actual results to differ
         materially from those contemplated by the statements. The
         forward-looking information is based on various factors and is derived
         using numerous assumptions:

         - changes in general economic and business conditions affecting
         security technology; - technical developments that make the Company's
         products or services obsolete; - changes in the Company's business
         strategies; - the level of demand for the Company's products or
         services; - the Company's ability to develop or maintain strategic
         relationships; and
-        global economic conditions.

         The Company does not promise to update forward-looking information to
         reflect actual results or changes in assumptions or other factors that
         could affect those statements. Future events and actual results could
         materially differ from those expressed in, contemplated by, or
         underlying such forward-looking statements.


<PAGE>


                                     PART I

ITEM 1. DESCRIPTION OF BUSINESS
-----------------------------------------------------
Overview

         AMERICAN SECURITY RESOURCES CORPORATION (the "Company" or "ASRC") is a
holding company with a wholly owned subsidiary, Hydra Fuel Cell Corporation,
that is developing advanced hydrogen fuel cells based on its proprietary
intellectual property. ASRC seeks additional technologies and companies with
technologies that will expand or enhance the product line of the Company's
wholly owned subsidiary Hydra Fuel Cell Corporation or advance the Company's
expansion into the development of alternative energy production.

         The Company's Internet address is
http://www.americansecurityresources.com. Information contained on the Company's
web site is not a part of this report. The Company's stock is traded on the OTC
Bulletin Board under the symbol "ARSC."


Organizational History
------------------------------

         The Company, previously known as Computer Automation Systems, Inc., was
reorganized and recapitalized in 2004 changing its name, first to Kahuna Network
Security, Inc. and in July, 2004, to American Security Resources Corporation
with a business focus of acquiring companies in homeland security and national
defense. With the acquisition of eGO Design Inc. in October, 2005, the Company
changed its focus to the development and commercialization of technologically
advanced, high volume mass producible, hydrogen fuel cells.


The Company's Products and Services
--------------------------------------------------
         The Company is developing hydrogen fuel cells which it expects to begin
delivering in the fourth quarter of 2006.


Employees
--------------
         As of December 31, 2005, the Company had two full-time employees. None
of the Company's employees is covered by any collective bargaining agreements.
Management believes that its relations with its employees are good and the
Company has not experienced any work stoppages attributable to employee
disagreements.
         The Company's subsidiary, Hydra Fuel Cell Corporation, has
approximately twelve employees or contractors working on the development of the
Company's proprietary HydraStax(TM) hydrogen fuel cells.


RISK FACTORS

Limited History
----------------------
         The Company is a startup with limited operating history and faces
challenges typical of new businesses in highly competitive markets with many
other providers of the same or essentially the same products and services.

Limited Revenue and Resources
-----------------------------------------
         The Company has acquired a start up business. There is no assurance
that the Company will be able to finance its development, or that the Company
will be able profitably to operate such business.


<PAGE>


Limited Staff
-------------------
         The Company has two officers and two additional directors charged with
the responsibility of executing the Company's business strategy. Any death,
injury or other incapacity of one or more of them could adversely affect the
Company's ability to complete its business strategy.

Volatility of Stock Market
----------------------------------
         There have been significant fluctuations in the market price for the
Company's common stock. Factors such as variations in the Company's revenues,
earnings, if any, and cash flow and announcements of innovations or acquisitions
by the Company or its competitors could cause the market price of the common
stock to fluctuate substantially. In addition, the stock market has experienced
price and volume fluctuations that have particularly affected companies in the
network security services markets and homeland security services, resulting in
changes in the market price of the stock of many companies which may not have
been directly related to the operating performance of those companies. Such
broad market fluctuations may adversely affect the market price of the Company's
common stock.

ITEM 2.  DESCRIPTION OF PROPERTY
--------------------------------------------------------
         ASRC has leased approximately 1,800 square feet of office space at 9601
Katy Freeway, Ste 220, Houston, TX 77024, for approximately $2,300 per month
until July 31, 2007. The Company believes this space will be sufficient for its
needs for the term of the lease.

ITEM 3.  LEGAL PROCEEDINGS
----------------------------------------------
         From time to time, the Company may become involved in litigation
arising in the ordinary course of its business. The Company is not presently a
party to any legal proceedings.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
-------------------------------------------------------------------------------
         On November 21, 2005, the Company held a shareholders meeting at which
the Company's Chairman Joe Grace announced his resignation. The Board selected
Frank Neukomm, the Company's CFO, as Chairman. The shareholders approved the
Company's "Incentive Stock Plan", approved the appointment of Malone & Bailey as
the Company's auditors and elected Mr. Neukomm as a Director for a two year term
and Robert Wilson and Bob Farr as Directors for one year terms

         PART II

Item 5.  Market for Common Equity and Related Stockholder Matters.
-------------------------------------------------------------------------------

Market Information.
---------------------------
         The Company's common stock trades on the OTC Bulletin Board under the
symbol "ARSC". The market for the Company's common stock on the OTC Bulletin
Board is limited, sporadic and highly volatile.

         The following quotations were provided by the OTC Bulletin Board for
the Company's common stock for the last two years. The quotations represent
inter-dealer prices and do not necessarily represent actual transactions. These
quotations do not reflect dealer markups, markdowns or commissions.


<PAGE>


Quarter ended:                                       High               Low
--------------                                       ----               ---
December 31, 2005                                    $0.27             $0.10
September 30, 2005                                   $0.24             $0.04
June 30, 2005                                        $0.45             $0.10
March 31, 2005                                       $0.55             $0.30

December 31, 2004                                    $0.55             $0.36
September 30, 2004                                   $0.69             $0.30
June 30, 2004                                        $0.75             $0.30
March 31, 2004                                       $1.10             $0.45


Holders
-----------
          The number of record holders of the Company's securities as of the
date of this Report is approximately 319

Dividends
--------------
          The Company has not declared any cash dividends with respect to its
common stock, and does not intend to declare dividends in the foreseeable
future. The future dividend policy of the Company cannot be ascertained with any
certainty, and if and until the Company completes any acquisition,
reorganization or merger, no such policy will be formulated. There are no
material restrictions limiting, or that are likely to limit, the Company's
ability to pay dividends on its securities.


Recent Sales of Unregistered Securities
--------------------------------------------------

         Pursuant to a consulting agreement dated May1, 2005, the Company issued
1,211,765 shares to Timothy J Connolly on May 10,2005 and pursuant to a Warrant
granted under the consulting agreement the Company issued an additional
1,000,000 shares on June 20,2005. In addition to certain consulting services the
Company received $77,000 as consideration for these shares.

         On June 15,2005 pursuant to an authorization of the Board of Directors
the Company issued shares to certain officers and directors of the Company in
lieu of unpaid salary and fees. The share and dollar amounts are as follows: Joe
Grace 578571 shares $40,500; Frank Neukomm 342,857 shares $24,000; Robert Farr
321,429 shares $22,500.

         On June 20,2005, pursuant to a consulting agreement, the Company issued
300,000 shares to Princeton Consulting Group.

         On July 26, 2005, pursuant to a consulting services contract, the
Company issued 500,000 shares to the George Miller Company. Also on July 26,
75,000 shares were issued to Jonathan Gilchrist for legal services, and 100,000
shares were issued to Robert J. Wilson as a Directors fee.

         On August 3, 2005, pursuant to an authorization of the Board shares
were issued to certain officers and directors in lieu of certain salaries and
fees. The share and dollar amounts are as follows: Joe Grace 216,617 shares
$6,500; Frank Neukomm 166,667 shares $5,000: and Robert Farr 53,333 shares
$1,600.

         On August 20, 2005, the Company issued 1,500,000 shares to Brewer &
Pritchard, P.C. pursuant to a 3/a/9 transaction to pay legal fees. The fee
amount was $81,094.11.

         On September 8 and 27, 2005 the Company issued 60,000 shares and 40,000
shares to B&B Marketing Communications, pursuant to a consulting services
agreement. Also on September 27, the Company issued 1,000,000 shares to the
Owners Group, Inc. pursuant to a Consulting Services Agreement.


         On October 12, 2005, pursuant to an authorization of the Board, the
Company issued shares to certain officers and directors in lieu of certain
salaries and fees. The share and dollar amounts are as follow: Joe Grace 37,500
shares $7,500; frank Neukomm 30,000 shares $6,000; Robert Farr 12,000 shares
$2,400.


         Also on October 12, pursuant to an agreement with American Enterprise
Development Corp., the Company issued 500,000 shares to Jonathan Gilchrist.

         On October 26, 2005, pursuant to a consulting services agreement, the
Company issued 100,000 shares to The George Miller Company, 100,000 shares to
Ron Hargrove and 100,000 shares to Joe K. Smith.

         On October 27, the Company issued shares as directors fees to Joe Grace
200,000: Frank Neukomm 200,000 and to Robert Farr 100,000.

         On October 26 and November 1, to complete the acquisition of eGo Design
Inc., the Company issued 7,200,000 shares to Edward L. Davis: 3,600,000 shares
to Benjamin F. Schafer; and 1,200,000 shares to James Twedt, in exchange for all
the issued and outstanding stock of eGO Design, Inc.

         On November 29, 2005, the Company issued shares in lieu of salary to
certain contractors of its Hydra Fuel Cell Corp. subsidiary. The recipients and
amounts are as follows: Larry Burgess 80,000 shares, George Hull 80,000 shares,
Richard Smith 100,000 shares, James Gates 100,000 shares, Corey Davis 50,000
shares, Mark Hunt 100,000 shares, and Brenda Burres 200,000 shares. The labor
amount for these contractors was $142,000.


         On November 29,2005, the Company issued 1,500,000 shares to Wall
Streets Inside Reporter, Inc. in an equal exchange for 46,154 shares of
Strategic Growth Ventures Inc. (SGWV.PK) as part of a consulting services
agreement.


         On December 8 and 12, 2005, pursuant to a consulting services agreement
with OTC Services, Inc., the Company issued 1,400,000 shares to OTC Services,
Inc. and 1,400,000 shares to Darrel T. Uselton.

         On December 22, 2005, pursuant to its consulting agreement with AEDC,
the Company issued 500,000 shares to Jonathan Gilchrist.

         The above transactions were completed pursuant to either Section 4(2)
of the Securities Act or Rule 506 of Regulation D of the Securities Act. With
respect to issuances made pursuant to Section 4(2) of the Securities Act, the
transactions did not involve any public offering and were sold to a limited
group of persons. Each investor either received adequate information about the
Company or had access to such information. The Company determined that each
investor had such knowledge and experience in financial and business matters
that they were able to evaluate the merits and risks of an investment in the
Company.

         With respect to issuances made pursuant to Regulation D of the
Securities Act, the Company determined that each purchaser was an "accredited
investor" as defined in Rule 501(a) under the Securities Act, or if such
investor was not an accredited investor, that such investor received the
information required by Regulation D.

         All sales of the Company's securities were made by officers of the
Company who have received no commission or other remuneration for the
solicitation of any person in connection with the respective sales of the
securities described above. The recipients of securities represented their
intention to acquire the securities for investment only and not with a view to
sale, or for sale in connection with any distribution thereof. Appropriate
legends were affixed to the share certificates issued in these transactions.

Item 6.  Management's Discussion and Analysis or Plan of Operation
-------------------------------------------------------------------------------

Overview.
-------------
         The Company completed the acquisition of eGO Design Inc. of Tualatin,
Oregon. EGO had created and was developing proprietary technology for Proton
Exchange Membrane (PEM) hydrogen fuel cells. Prior to completing the transaction
on October 28, 2005, the Company completed extensive due diligence on the fuel
cell market and PEM based hydrogen fuel cells in particular and determined that
eGO had developed unique technologies and processes that could potentially
revolutionized the market for electricity generation in the United States and
eventually, for the whole planet.

         The Company exchanged 12,000,000 of its restricted common shares for
100% of the issued and outstanding stock of eGO Design Inc. The assets of eGO
were contributed to the Company's wholly owned subsidiary, Hydra Fuel Cell
Corporation, which it had incorporated in Nevada for the purpose of developing
and marketing the fuel cell opportunity.

         As of December 31, 2005 Hydra had designed, assembled and tested a
successful prototype of the Company's proprietary fuel cell concept.

         In February, 2005, the Company collected its note receivable from
Superior Protection Inc. The principal amount due was $200,000 and was paid to
the Company as $100,000 cash and the return of 500,000 shares of the Company's
common stock which were cancelled. The market value of the shares at the time
was approximately $150,000.

         The Company generated no substantive revenue in 2005, beyond the
interest it earned on its bank deposits. Management believes that it has
sufficient sources of funds to continue the development of Hydra's fuel cell
concept, but it will need to raise approximately $5,000,000 in 2006 to
completely fund Hydra's development needs.



Critical Accounting Policies
------------------------------------
         Revenue Recognition

         The Company recognizes revenue when products and services are
delivered.

         Accounting for Stock-Based Compensation

         Stock-based compensation is accounted for following the provisions of
Accounting Board Opinion No.25 as amended by the FASB Interpretation No.44.
These rules state that no compensation expense is recorded for stock options or
other stock awards to employees that are granted with an exercise price equal to
or above the estimated fair value per share on the date of the grant.

         The Company follows the disclosure requirements of Financial Accounting
Standards No. 123 as amended by FASB Statement No.148.


<PAGE>


Off Balance Sheet Arrangements
------------------------------------------
         The Company has no off balance sheet arrangements.

Accounting Pronouncements
---------------------------------------
          In December 2002, the FASB issued SFAS No. 148.Statement 148
establishes standards for two alternative methods of transition to the fair
value method of accounting for stock-based employee compensation of FASB SFAS
no. 123. SFAS 148 also amends and augments the disclosure provisions of SFAS 123
and Accounting Principles Board Opinion 28 to require disclosure in the summary
of significant accounting policies for all companies of the effects of an
entity's accounting policy with respect to stock-based employee compensation on
reported net income and earnings per share in annual and interim financial
statements. The transition standards and disclosure requirements of SFAS 148 are
effective for fiscal years and interim periods ending after December 15, 2002.
The Company has adopted these standards which have had no material effect on the
Company's financial position

         SFAS no. 150 was issued in May 2003 and requires issuers to classify as
liabilities three classes of freestanding financial instruments that represent
obligations for the issuer. SFAS No. 150 is effective for financial instruments
entered into or modified after May 31, 2003 and is otherwise effective at the
beginning of the first interim period beginning after December 15, 2003. The
adoption of this statement did not have a material effect on the Company's
financial, results of operations or cash flows.

Results of Operations.
-----------------------------
         The Company had no revenue during the calendar years ended December 31,
2005 and 2004.


         The Company had no gross profit during the calendar years 2005 and
2004. General and administrative expenses were $5,384,548 and $28,805,594 for
the calendar years ended December 31, 2005 and 2004 respectively. Principal
general and administrative expenses included contracted services ($5,223,768 and
$28,750,432, respectively); legal expenses ($20,845 and $29,153, respectively);
payroll ($108,396 and $105,164 respectively); and rent ($26,558 and $13,382).


         The Company had a net operating loss for the years ended December 31,
2005 and 2004.

Liquidity and Capital Resources.
-------------------------------------------
         In March of 2004 the Company completed a private placement of 2.5
million Units for gross proceeds of $500,000. Each Unit consists of one share of
common stock and seven Warrants to purchase an additional share of stock at
prices between $0.30 and $0.90 inclusive. The cash remaining from the Units
offering is sufficient to fund the Company's operations for the next four
quarters. Any exercise of Warrants will provide the Company with additional
funds to expand operations or fund acquisitions.


         The Company did not generate any cash flow from operating activities
during 2005 and 2004. The Company had cash assets of $11,585 and $37,852 as of
December 31, 2005 and 2004 respectively.


         The net change in cash position for 2005 is due primarily to
operational costs of the parent company after funding $45,000 to Hydra in the
4th Quarter.

         Management does not believe that SFAS No's 131 and 133 regarding
segment reporting and derivatives, respectively, will have any impact on the
Company's financial condition and operations.



<PAGE>



                          ITEM 7 - FINANCIAL STATEMENTS


            AMERICAN SECURITY RESOURCES CORPORATION AND SUBSIDIARIES


                          INDEX TO FINANCIAL STATEMENTS


<TABLE>
                                                                                                             Page
<S>                                                                                                          <C>
Report of Independent Certified Public Accountants.............................................................3

Financial Statements

   Consolidated Balance Sheets at December 31, 2005 ...........................................................4

   Consolidated Statements of Operations and Comprehensive Loss for the years ended
   December 31, 2005 and 2004.................................................................................5

   Consolidated Statement of Shareholders' Equity for the years
   ended December 31, 2005 and 2004............................................................................6

   Consolidated Statements of Cash Flows for the years ended
   December 31, 2005 and 2004..................................................................................7

   Notes to Consolidated Financial Statements..................................................................8
</TABLE>


<PAGE>



         REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS



To the Board of Directors and Shareholders of
American Security Resources Corporation
(formerly Kahuna Network Security, Inc. and Subsidiary)
Houston, Texas


We have audited the accompanying consolidated balance sheet of American Security
Resources Corporation formerly, Kahuna Network Security, Inc., as of December
31, 2005, and the related consolidated statements of expenses, shareholders'
equity, and cash flows for each of the two years then ended. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.


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


In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of American Security
Resources Corporation as of December 31, 2005, and the consolidated results of
their operations and cash flows for each of the two years then ended, in
conformity with accounting principles generally accepted in the United States of
America.


The accompanying consolidated financial statements have been prepared assuming
that American Security Resources Corporation will continue as a going concern.
As discussed in Note 2 to the consolidated financial statements, American
Security Resources Corporation suffered losses from operations since inception,
which raises substantial doubt about its ability to continue as a going concern.
Management's plans regarding those matters also are described in Note 2. The
consolidated financial statements do not include any adjustments that might
result from the outcome of this uncertainty

MALONE & BAILEY, PC
                             www.malone-bailey.com
Houston, Texas


March 28, 2006







<PAGE>




            AMERICAN SECURITY RESOURCES CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET
                                December 31, 2005
<TABLE>
                                     ASSETS
<S>                                                                                            <C>
    Cash in bank                                                                               $     11,585
    Prepaid Expenses                                                                                  4,015
      Investment, available for sale                                                                  138,462
                                                                                               --------------

    Total Current Assets                                                                            154,062

    Equipment (net of accumulated deprecation of $4,129
                                                                                                     15,455

    Total Assets                                                                               $     169,517
                                                                                               =============



LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES

      Accounts payable                                                                         $      7,953
    Other current liabilities                                                                        17,525
                                                                                               ------------

    Total current liabilities                                                                           25,478
                                                                                               ---------------


    Contingencies                                                                                         -

Shareholders' deficit:
    Preferred stock - 1,000,000 shares authorized; $.001 par
      value; no shares issued or outstanding                                                              -
    Common stock - 200,000,000 shares authorized; $.001 par
      value; 61,675,766 shares issued and outstanding

      at December 31, 2005                                                                           61,676
    Additional paid-in capital                                                                   35,205,849
    Accumulated deficit                                                                         (35,036,948)
      Accumulated Other Comprehensive Loss                                                   (       86,538)
                                                                                           ----------------

Total shareholders' equity                                                                             144,039
                                                                                               ---------------

Total liabilities and shareholders' equity                                                   $      169,517
                                                                                             ==============

</TABLE>



               See accompanying summary of accounting policies and
                         notes to financial statements.





<PAGE>


            AMERICAN SECURITY RESOURCES CORPORATION AND SUBSIDIARIES

       CONSOLIDATED STATEMENTS OF OPERATIONS and OTHER COMPREHENSIVE LOSS
                 For the years ended December 31, 2005 and 2004

<TABLE>



                                                                           2005                      2004
                                                                       -------------             ------------
<S>                                                                    <C>                      <C>

General and administrative expenses                                    $   5,384,548             $ 28,805,594

Impairment of investment                                                           -                   60,000


Forgiveness of debt income                                                         -                   (8,167)
                                                                       -------------             -------------


Net  loss                                                              $  (5,384,548)            $(28,857,427)
                                                                        =============             ============

Other Comprehensive Loss:
     Change in Unrealized Loss on Investment Available
      For Sale                                                                  (86,538)
                                                                       ----------------

Comprehensive Loss                                                     $  (5,471,086)
                                                                       =============

Loss per common share - basic and diluted                              $        (.13)            $       (.92)
                                                                       ==============            =============


Weighted average shares outstanding - basic and diluted                   42,053,103               31,284,330
                                                                       =============             ============


</TABLE>




               See accompanying summary of accounting policies and
                         notes to financial statements.



<PAGE>





            AMERICAN SECURITY RESOURCES CORPORATION AND SUBSIDIARIES
                 CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
                 For the years ended December 31, 2005 and 2004

<TABLE>
                                                              Common Stock             Retained
                                                          Shares           Amount          Deficit          Total
<S>                                                    <C>           <C>             <C>             <C>
Balances at December 31, 2003                          2,862,155     $   612,362     $   (794,973)   $  (182,611)


   Shares issued for:

       - cash                                          2,755,625         541,450                -        541,450


     - debt                                              752,168         158,042                -        158,042

     - director services                              12,600,000     10,820,000      -               10,820,000

     - services                                       16,813,604     16,980,069      -               16,980,069


     - investment                                        236,425               -                -              -
    Shares repurchased for note
     receivable and canceled                            (500,000)       (100,000)               -       (100,000)
    Shares re-purchased                                 (200,000)        (40,000)               -        (40,000)

   Fair value of warrants issued for services                             769,834                                          769,834

   Net loss                                                    -                    -                 (28,857,427)
                                                   -------------     ----------------------------   -------------- --------

(28,857,427)


Balances at December 31, 2004                         35,319,977      29,741,757      (29,652,400)         89,357


Shares issued for:
     -  cash                                           2,000,000          77,000                          77,000

     - exercise of warrants                                            1,505,897                       1,505,897

     -  directors' services                            2,624,501         248,567                         248,567

     - services                                        8,231,288       1,429,304                       1,429,304


     - acquisition of subsidiary                      12,000,000       2,040,000                       2,040,000

     - equity swap investment                          1,500,000         225,000                         225,000

     Net loss                                                                        (  5,384,548)  (  5,389,968)
                                                                                                                -

       Other Comprehensive loss                               -            -                  -       (
                                              ----------------- -------------------- --------------    ----------
86,538)

Balances at December 31, 2005                         61,675,766     $35,267,525    $ (35,036,948) $        144,039
                                                      ==========     ===========    ============== ================

Less:  par                                                         (      61,676)
                                                                 ---------------

Additional paid in capital                                         $35,205,849
                                                                   ===========
</TABLE>

               See accompanying summary of accounting policies and
                         notes to financial statements.



            AMERICAN SECURITY RESOURCES CORPORATION AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                 For the years ended December 31, 2005 and 2004


<TABLE>
                                                                               2005                     2004
                                                                           ------------             -----------
<S>                                                                        <C>                     <C>
Cash flows from operating activities

    Net loss                                                                $(5,384,548)           $(28,857,427)
    Adjustments to reconcile net loss to net cash

      provided by (used in) operating activities:
        Depreciation and amortization                                             2,648                   1,481
        Impairment of investment in Simple Network Solutions                          -                  60,000
        Forgiveness of debt income                                                    -                  (8,167)

Common stock for services                                                     5,223,768              27,800,069
    Warrants Issued                                                                   -                  769,834
    Changes in operating assets and liabilities:
        Prepaid expenses                                                         (4,015)                      -
        Accounts payable                                                          4,553                 (13,233)
          Accrued liabilities                                                   (37,404)                 54,929
                                                                           -------------            -----------

          Net cash used in operating activities                                (194,998)               (192,514)
                                                                           -------------            -----------


Cash flows from investing activities

    Note receivable                                                             100,000                (200,000)
    Investment in Simple Network Solutions                                            -                 (60,000)
    Purchases of property and equipment                                          (8,269)                (11,315)
                                                                           -------------            ------------

Net cash used in investing activities                                            91,731                (271,315)
                                                                           ------------             ------------


Cash flows from financing activities
    Proceeds from sale of common stock                                           77,000                 541,450
    Repurchase of common stock                                                        -                 (40,000)
                                                                           ------------             ------------


    Net cash provided by financing activities                                    77,000                 501,450
                                                                           ------------             -----------

Net change in cash and cash equivalents                                         (26,267)                 37,621


Cash and cash equivalents, beginning of year                                     37,852                     231
                                                                           ------------             -----------


Cash and cash equivalents, end of year                                     $     11,585             $    37,852
                                                                           ============             ===========


Supplemental disclosures of cash flow information:
    Cash paid for interest                                                 $          -             $       549

Schedule of non-cash investing and financing transactions

    Stock issued for Investment                                                                        $
225,000                      $                                             -
      Stock issued for debt                                                           -                 158,042
    Note receivable exchanged for return of common stock                              -                 100,000


</TABLE>
<PAGE>




            AMERICAN SECURITY RESOURCES CORPORATION AND SUBSIDIARIES
                          NOTES TO FINANCIAL STATEMENTS



NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization

The Company was incorporated in Nevada in 1998. It began operations as Computer
Automation Systems, Inc., a company that designed and manufactured custom rack
mount and industrial computer applications for the telecom and other high tech
industries. In January of 2004, the Company was recapitalized and its name was
changed to Kahuna Network Security Inc.

At that time the company's shareholders voted to increase the total number of
authorized shares of common stock from 15,000,000 to 200,000,000, to decrease
the number of authorized shares of preferred stock from 5,000,000 to 1,000,000
and approved a 1 for 4 reverse stock split. All share and per share amounts have
been restated for the split.


On July 2, 2004, the Board of Directors voted to change the name of the company
to American Security Resources Corporation (ASRC), a change that was ratified by
a majority of the Company's shareholders in July of 2004.


Basis of presentation. The consolidated financial statements include the
accounts of American Security Resources Corporation and its wholly-owned
subsidiaries. Significant inter-company accounts and transactions have been
eliminated.

Use of Estimates. In preparing financial statements, management makes estimates
and assumptions that affect the reported amounts of assets and liabilities in
the balance sheet and revenue and expenses in the statement of expenses. Actual
results could differ from those estimates.

Cash and Cash Equivalents. For purposes of the statement of cash flows, ASRC
considers all highly liquid investments purchased with an original maturity of
three months or less to be cash equivalents.


Comprehensive Income. For purposes of the statement of operations, comprehensive
income consists of net income and other gains and losses affecting shareholders'
equity that, under generally accepted accounting principles, are excluded from
net income. For the Company, such items consist primarily of unrealized gains
and losses on marketable equity investments.

Available-for-Sale Marketable Securities. ASRC classifies its marketable equity
securities into the available-for-sale category. These securities are carried at
fair market value with the unrealized gains and losses, net of tax, included in
the determination of comprehensive income (loss) and reported in shareholders'
equity.


Revenue Recognition. ASRC recognizes revenue when persuasive evidence of an
arrangement exists, services have been rendered, the sales price is fixed or
determinable, and collectibility is reasonably assured. This typically occurs
when the services are performed. There were no revenues for 2005 and 2004.

Property and equipment is valued at cost. Additions are capitalized and
maintenance and repairs are charged to expense as incurred. Gains and losses on
dispositions of equipment are reflected in operations. Depreciation is provided
using the straight-line method over the estimated useful lives of the assets,
which is estimated at five years.

Impairment of Long-Lived Assets. ASRC reviews the carrying value of its
long-lived assets annually or whenever events or changes in circumstances
indicate that the historical cost-carrying value of an asset may no longer be
appropriate. ASRC assesses recoverability of the carrying value of the asset by
estimating the future net cash flows expected to result from the asset,
including eventual disposition. If the future net cash flows are less than the
carrying value of the asset, an impairment loss is recorded equal to the
difference between the asset's carrying value and fair value.

Income taxes. ASRC recognizes deferred tax assets and liabilities based on
differences between the financial reporting and tax bases of assets and
liabilities using the enacted tax rates and laws that are expected to be in
effect when the differences are expected to be recovered. ASRC provides a
valuation allowance for deferred tax assets for which it does not consider
realization of such assets to be more likely than not.

Basic and diluted net loss per share. The basic net loss per common share is
computed by dividing the net loss by the weighted average number of common
shares outstanding. Diluted net loss per common share is computed by dividing
the net loss adjusted on an "as if converted" basis, by the weighted average
number of common shares outstanding plus potential dilutive securities. For the
years ended December 31, 2005 and 2004, potential dilutive securities had an
anti-dilutive effect and were not included in the calculation of diluted net
loss per common share.


Stock Compensation. ASRC adopted the disclosure requirements of Financial
Accounting Standard No. 123, Accounting for Stock-Based Compensation (FAS No.
123) and FAS No. 148 with respect to pro forma disclosure of compensation
expense for options issued. For purposes of the pro forma disclosures, the fair
value of each option grant is estimated on the grant date using the
Black-Scholes option-pricing model. ASRC applies APB No. 25 in accounting for
its stock option plans and, accordingly, no compensation cost has been
recognized in ASRC financial statements for stock options under any of the stock
plans which on the date of grant the exercise price per share was equal to or
exceeded the fair value per share. However, compensation cost has been
recognized for warrants and options granted to non-employees for services
provided. There were no options granted or outstanding during 2005 and 2004 to
employees.


Recently issued accounting pronouncements. In December 2004, the FASB issued
SFAS No.123R, "Accounting for Stock-Based Compensation" SFAS No.123R establishes
standards for the accounting for transactions in which an entity exchanges its
equity instruments for goods or services. This Statement focuses primarily on
accounting for transactions in which an entity obtains employee services in
share-based payment transactions. SFAS No.123R requires that the fair value of
such equity instruments be recognized as expense in the historical financial
statements as services are performed. Prior to SFAS No.123R, only certain pro
forma disclosures of fair value were required. SFAS No.123R shall be effective
for small business issuers as of the beginning of the first interim or annual
reporting period that begins after December 15, 2005. While ASRC has not issued
options to employees recently, it may do so in the future. The adoption of this
new accounting pronouncement is not expected to have a material impact on the
consolidated financial statements of ASRC during the calendar year 2006.

ASRC does not expect the adoption of any other recently issued accounting
pronouncements to have a significant impact on their consolidated financial
position, results of operations or cash flow.


NOTE 2 - GOING CONCERN


As shown in the accompanying consolidated financial statements, ASRC incurred
recurring losses from continuing operations of $5,389,968 and $28,087,593 in the
year 2005 and 2004, respectively. This condition creates an uncertainty as to
ASRC's ability to continue as a going concern. Management is trying to raise
additional capital through sales of common stock as well as seeking other
sources of funding.. The consolidated financial statements do not include any
adjustments that might be necessary if ASRC is unable to continue as a going
concern.


NOTE 3 - PROPERTY AND EQUIPMENT

Property and equipment consisted of the following at December 31, 2005:
<TABLE>
                  Description                                         Life                         Amount
                  -----------------------                             -------                   ----------
<S>               <C>                                                 <C>                       <C>
                  Equipment                                           5 years                      $ 4,988
                  Office furniture and equipment                      5 years                       14,596

                                                                                                ----------
                                                                                                    19,584
                  Less: accumulated depreciation                                                    (4,129)
                                                                                                ----------
                                                                                                  $ 15,455
                                                                                                    ======
</TABLE>
Depreciation expense totaled $2,648 and $1,481 for the years December 31, 2005
and 2004, respectively.



 NOTE 4 - INVESTMENT, AVAILABLE FOR SALE

ASRC exchanged 1,500,000 of its common stock for 46,154 shares of common stock
of Strategic Growth Ventures, Inc., which trades under the symbol:  SGWV.PK.
At December 31, 2005, this amount is recorded at fair value and classified as
available for sale.

NOTE 5 - COMMON STOCK

In 2004, $100,000 of a note receivable due to ASRC was exchanged for the return
of 500,000 shares of ASRC


In 2004, ASRC repurchased 200,000 shares of its common stock for $40,000.

In 2005, ASRC issued 2,624,501 shares of common stock to directors for services
valued at the then market price totaling $248,567 and issued 8,231,288 shares of
common stock to outsiders for services valued at the then market price totaling
$1,429,304.

In 2005, ASRC issued 2,000,000 shares for warrants exercised and received
$77,000 in cash, the value at the then market price totaled $780,000.


In 2005, ASRC issued 12,000,000 shares to the original shareholders of eGo
Designs, Inc. ("eGo") for the assets of eGo valued at the then market price
totaling $2,040,000. This amount is recorded as an expense in 2005.

In 2005, ASRC issued 1,500,000 shares as an equity swap for 46,154 shares of
common stock of Strategic Growth Ventures, Inc. (the shares were issued to Wall
Street Insider Report), valued at the then market price totaling $225,000.

NOTE 6 - WARRANTS

In March of 2004, ASRC completed a private placement of 2.5 million Units
consisting of one share of its common stock and seven warrants to purchase
additional shares of common stock at a prices ranging from $0.30 to $0.90. The
exercise period for these warrants expire on December 31, 2006. None of these
warrants were exercised during 2005.

In October 2004, ASRC issued 2,000,000 warrants to purchase common stock at an
initial exercise price of $0.30 per share with reset provisions during the first
four six-month anniversary dates. The Company estimated the fair value of the
warrants to be $769,834 using the Black Scholes pricing model and recorded the
entire amount as an expense.

On May 1,2005, ASRC issued warrants to purchase 6,000,000 shares of common stock
to non-employee in exchange for consulting services. All of the warrants expire
two years from the grant date and vested immediately. The company had estimated
the fair value of the warrants to be $1,505,897 using the Black Scholes pricing
model and recorded the entire amount as an expense. 2,000,000 of these warrants
were exercised for $77,000 during 2005. Subsequent to the exercise, the
remaining 4,000,000 were cancelled and are no longer outstanding as of 12/31/05.

Summary information regarding warrants is as follows:
<TABLE>
                                                                                                  Weighted
                                                                                                 Average
                                                                              Warrants         Share Price
                                                                           --------------      --------------
<S>                                                                        <C>                 <C>
Year ended December 31, 2004:

     Granted                                                                   17,500,000            0.60
     Granted                                                                    2,000,000            0.40

                                                                           --------------        --------
Outstanding at

     December 31, 2004                                                         19,500,000          $ 0.60

        Granted                                                                 1,000,000           $0.30
        Granted                                                                 5,000,000           $0.30
        Exercised for Cash                                                     (2,000,000)          $0.04
        Cancelled                                                              (4,000,000)          $0.30
Outstanding at December 31, 2005                                               19,500,000           $0.60
                                                                              ===========           =====
</TABLE>
Warrants outstanding and exercisable as of December 31, 2004 and 2005:
<TABLE>
                                                 - - Outstanding - -                Exercisable
                                             Number               Remaining             Number
              Exercise Price                  of Shares             life               of Shares
              --------------              -------------           ---------          ------------
<S>           <C>                         <C>                     <C>               <C>
                  $0.30                       2,500,000              1 year             2,500,000
                   0.30                       2,000,000             2 years             2,000,000
                   0.40                       2,500,000              1 year             2,500,000
                   0.50                       2,500,000              1 year             2,500,000
                   0.60                       2,500,000              1 year             2,500,000
                   0.70                       2,500,000              1 year             2,500,000
                   0.80                       2,500,000              1 year             2,500,000
                   0.90                       2,500,000              1 year             2,500,000

                                         --------------                             -------------

                                             19,500,000                                19,500,000

                                               ========                                  ========
</TABLE>

NOTE 7 - INCOME TAXES


ASRC uses the liability method, where deferred tax assets and liabilities are
determined based on the expected future tax consequences of temporary
differences between the carrying amounts of assets and liabilities for financial
and income tax reporting purposes. During fiscal 2005 and 2004, ASRC incurred
net losses and, therefore, has no tax liability. The net deferred tax asset
generated by the loss carry-forward has been fully reserved. The cumulative net
operating loss carry-forward is approximately $4,200,000 at December 31, 2005
and will expire in the years 2018 through 2025.

At December 31, 2005 deferred tax assets consisted of the following:

                                                                       2005
                                                                   ------------
                  Deferred tax assets                                $1,428,000
                    Less:  valuation allowance                       (1,428,000)
                                                                     ----------


                  Net deferred tax asset                        $             -
                                                                ===============


NOTE 8 - LEASES


ASRC leased office space under an operating lease during 2005. The lease
agreement provided for monthly rent of $2,400 to be paid on a month-to-month
basis. Total rent expense was $25,926 and $13,382 during 2005 and 2004,
respectively.


NOTE 9 - RELATED PARTY TRANSACTIONS

On September 12, 2005, ASRC entered into a consulting agreement with American
Enterprise Development Corporation ("AEDC") with respect to certain financing,
capital raising, product development, marketing, sales and acquisition,
strategic planning, capital expenditure, business development and general
corporat and organizational matters. One of ASRC's directors is also a director
of AEDC. Fees associated with this agreement will be paid in either stock or
cash based on the terms set forth in the agreement.

NOTE 10 - SUBSEQUENT EVENTS

Subsequent to 12/31/05, ASRC granted warrants to purchase 2,750,000 shares to
non-employees for services rendered in 2006. These warrants were exercised for
$334,850.

ASRC issued 1,270,000 shares for services to employees. ASRC also issued 300,000
shares to directors for services.

On March 24, 2006, ASRC sold 2,848,000 shares for $419,500 in connection with a
Private Placement Memorandum.



ITEM 8


Changes In and Disagreements with Accountants on Accounting and Financial
Disclosure.

-------------------------------------------------------------------------------
None.

Item 8A.  Controls and Procedures.
----------------------------------------------

         The Company's Chief Executive Officer and Chief Financial Officer
("Certifying Officers") are responsible for establishing and maintaining
disclosure controls and procedures for the Company. The Certifying Officers have
concluded (based on their evaluation of these controls and procedures as of
December 31, 2005), that the design and operation of the Company's disclosure
controls and procedures (as defined in Rule 13a-14(c) under the Securities
Exchange Act of 1934) do not adequately meet intended objectives and are not
effective. As of this date, given the small size of the Company and its limited
operations and over the last year, the Company utilized a preliminary and basic
standard of internal controls and procedures related to its financial reporting
for the period covered by this report. Management is in the process of
developing and adopting new and more stringent controls and procedures and
anticipates such controls and procedures to be in place prior to the end of
fiscal year 2006.


         Disclosure controls and procedures are controls and other procedures
that are designed to ensure that information required to be disclosed in Company
reports filed or submitted under the 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 Company reports filed under the Exchange
Act are accumulated and communicated to management, including our Chairman, to
allow timely decisions regarding required disclosure.

         No significant changes were made in the Company's internal controls nor
other facts that would significantly affect these controls subsequent to the
date of this evaluation, including any corrective actions with regard to
significant deficiencies and material weaknesses.


                                    PART III

ITEM 9 - Directors, Executives Officers, Promoters and Control Persons,
               Compliance with Section 16(a) of the Exchange Act
-------------------------------------------------------------------------------
         The Company has adopted a Code of Ethics that applies to all of its
Directors, Officers (including its CEO, CFO and chief accounting officer and any
person performing similar functions) and all employees. The Code is attached as
"Exhibit 14H".

Directors and Executive Officers
--------------------------------------------------

         The following table sets forth the names of all current directors and
executive officers of the Company. These persons will serve until the next
annual meeting of the stockholders or until their successors are elected or
appointed and qualified, or their prior resignation or termination.

                                                              Date of
                                 Positions                  Election or
Name                               Held                     Designation
----                               ----                     -----------
Robert C Farr                   President/COO                 11/23/05
                                Director                      10/27/04

Frank Neukomm                   CFO, Director                  2/25/04
                                Secretary                     11/08/04
                                Chairman/CEO                  11/21/05

Robert J Wilson                 Director                      07/21/05

Edward L Davis                  Director                      11/21/05


 Business Experience
---------------------------
               Frank Neukomm (56),  Chairman/ CEO, has an extensive  background
 in finance,  mergers and  acquisitions,  and sales and
marketing.  Mr. Neukomm has served as a senior executive of brokerage and M & A
 companies,  software  companies and telecom  companies.
Mr. Neukomm has been  instrumental  in purchasing or starting  companies in
industries as diverse as insurance,  consumer retail goods,
industrial  services and wireless  telecommunications.  Since 1995,  Mr.
Neukomm has served as President of NeuHaus  Advisors,  Inc., a
consulting firm to the telecommunications industry.

         Robert Farr (60), President/COO has extensive Fortune 500 management
experience in a variety of industries. His experience extends to domestic and
international finance, marketing, manufacturing and distribution. He is the
Principal of Creative Equity Strategies.

         Robert J Wilson, Director, is a CPA and an independent Director who
serves as Audit Committee Chairman.

         Edward L. Davis, Director, serves as Chairman of the Company's Hydra
Fuel Cell Corporation subsidiary. He is Chief Architect at Intel Corporation and
is the principle inventor of the Company's proprietary fuel cell technology.

Compliance with Section 16(a) of the Exchange Act
------------------------------------------------------------------

          Each of the Company's directors and executive officers filed a Form 3
Initial Statement of Beneficial Ownership of Securities with the Securities and
Exchange Commission on or after December 5, 2003, February 25, and November
2004. To the best knowledge of management, all reports required to be filed by
members of management under Section 16(a) of the 1934 Act have been filed.

Item 10. Executive Compensation.
--------------------------------------------

Cash Compensation.
---------------------------


Name              Year              Other Comp
Position          Period            Salary
-------------------------------------------------------------------------

Joe Grace           12/31/04      $28,500
CEO                 12/31/05      $34,500

Frank Neukomm       12/31/04      $24,000
CFO, Secretary      12/31/05      $35,000

Robert Farr            10/27/04                  $0
Director  12/31/05                $10,200

         Except as set forth above, no cash compensation, deferred compensation
or long-term incentive plan awards were issued or granted to the Company's
management during the calendar years ended December 31, 2005 and 2004.

Compensation of Directors
------------------------------------
         Certain Directors were compensated with restricted stock during 2005
for attending meetings and for work performed. Total stock awarded was 2,624,501
shares.

Employment Contracts and Termination of Employment and Change-in-Control
Arrangements.
-------------------------------------------------------------------------------

         There are no employment contracts, compensatory plans or arrangements,
including payments to be received from the Company, with respect to any director
or executive officer of the Company which would in any way result in payments to
any such person because of his or her resignation, retirement or other
termination of employment with the Company, any change in control of the
Company, or a change in the person's responsibilities following a change in
control of the Company.

Item 11. Security Ownership of Certain Beneficial Owners and Management.
-------------------------------------------------------------------------------

Security Ownership of Certain Beneficial Owners.
----------------------------------------------------------------

         The following table sets forth the share holdings of those persons who
own more than five percent of the Company's common stock, including stock
options, outstanding as of the date of this Report, assuming 29,942,807 shares
are outstanding:
<TABLE>
                                Type of           No. of Shares                                Percentage
    Name & Address             Ownership       Beneficially Owned*                              of Class
<S>                            <C>             <C>                                             <C>
Mr. Frank Neukomm                Personal                4,158,676                                   6.74%
9601 Katy Freeway, Suite 220

Houston, TX  77024

Robert Farr                     Corporate                  461,762                                    0.7%
9601 Katy Freeway, Suite 220
Houston, TX 77024

Robert J Wilson                  Personal                  100,000                                      0%
9601 Katy freeway, Suite 220
Houston, TX 77024

Edward L. Davis                  Personal                7,600,000                                 12.312%
9601 Katy freeway, suite 220
Houston, TX 77024
</TABLE>

*Mr. Neukomm's share number includes 162,500 shares held by The Neukomm
Children's Trust for which he is the trustee. Item 12. Certain Relationships and
Related Transactions.
 -----------------------------------------------

          There have been no material transactions, series of similar
transactions, currently proposed transactions, or series of similar
transactions, to which the Company and any director, executive officer, five
percent stockholder or associate of any of these persons is or was a party.

Item 13. Principal Accountant Fees and Services
--------------------------------------------------------------

AUDIT FEES

Malone & Bailey were the Company's auditors for the fiscal years ended December
31, 2005 and 2004.

AUDIT FEES

For their audit of our annual financial statements and for their review of our
Quarterly Reports on Form 10-Q, Malone & Bailey billed us a total of $9,985 for
the fiscal year ended December 31, 2005 and $7,610 for the fiscal year ended
December 31, 2004.

TAX FEES

For their review of tax matters, John A. Wilkinson, P.C. billed us a total of
$1,500 in 2005 and $1,850 in 2004.

ALL OTHER FEES

John A. Wilkinson, P.C. billed us $ 2,075 related to general accounting
services and quarterly filings of Form 10-QSB.

The Board of Directors Pre-approval Policy and Procedures

We do not have a separate Audit Committee. Our full Board of Directors performs
the functions of an Audit Committee. During fiscal year 2003, the Board of
Directors adopted policies and procedures for the pre-approval of audit and
non-audit services for the purpose of maintaining the independence of our
independent auditors. We may not engage our independent auditors to render any
audit or non-audit service unless either the service is approved in advance by
the Board of Directors or the engagement to render the service is entered into
pursuant to the Board of Director's pre-approval policies and procedures. On an
annual basis, the Board of Directors may pre-approve services that are expected
to be provided to us by the independent auditors during the following 12 months.
At the time such pre-approval is granted, the Board of Directors must (1)
identify the particular pre-approved services in a sufficient level of detail so
that management will not be called upon to make judgment as to whether a
proposed service fits within the pre-approved services and (2) establish a
monetary limit with respect to each particular pre-approved service, which limit
may not be exceeded without obtaining further pre-approval under the policy.

The Board has considered whether the provision of the services described above
under the caption "All Other Fees" is compatible with maintaining independence.


<PAGE>





                                     PART IV

Item 14. Exhibits and Reports on Form 8-K.
---------------------------------------------------------
         Reports on Form 8-K.
--------------------------------------

             Form 8-K      Election of Directors July and November, 2005
                           Departure of or Change of Corporate Officers or
                           Directors November 2005


Exhibits*

          (i)

         Registration Statement on Form 10-SB, as amended, previously filed with
the Securities and Exchange Commission**.


         Initial Articles of Incorporation filed in the State of Utah.**

         Initial Articles of Incorporation filed in the State of Nevada.**

         Articles of Merger to change the Company's domicile filed in the State
         of Utah and Nevada and effecting a one for four reverse split of the
         outstanding securities of The Company.**

         Certificate of Amendment changing the name of the Company to AMERICAN
         SECURITY RESOURCES CORPORATION in the State of Nevada.**

         By-Laws**

         Calculation of Weighted Average Shares**

         Subsidiaries**

         Financial Data Schedule.**



<PAGE>










Exhibit
Number               Description
----------          ---------------

14A                 Form of Warrant Agreement

14B                 Employment Agreement - Joe Grace

14F                 Exchange Agreement - ASRC and SNS

14H                 Code of Ethics


          *    Summaries of all exhibits contained within this Report are
               modified in their entirety by reference to these Exhibits.

                ** These documents and related exhibits have been previously
filed with the Securities and Exchange Commission. In accordance with the
requirements of the Exchange Act, the registrant caused this report to be signed
by the undersigned, hereunto duly authorized.










<PAGE>



EXHIBIT 14A - Form of Warrant Agreement
-----------------------------------------------------------

                     AMERICAN SECURITY RESOURCES CORPORATION

                                WARRANT AGREEMENT



         AMERICAN SECURITY RESOURCES CORPORATION, a Nevada corporation (the
"Company") (formerly known as Computer Automation Systems, Inc.), for value
received, hereby agrees to issue a Class A warrant entitling you to purchase the
shares of the Company's common stock (the "Common Stock") set forth on the
signature page hereof (each such instrument being hereinafter referred to as a
"Warrant, "Warrants: or "Warrant Agreement"). The Warrants will be issued in
consideration of an investment in the Company by you. The number of shares of
Common Stock purchasable upon exercise of the Warrants is subject to adjustment
as provided in Section 5 below. The Warrants will be exercisable by each you or
any other Warrant holder (as defined below) as to all or any lesser number of
shares of Common Stock covered thereby, at an initial Purchase Price of $.30 per
share, subject to adjustment as provided in Section 5 below, for the exercise
period defined in Section 3(a) below. The term "Warrant holder" refers to each
person whose name appears on the signature page of this agreement and any
transferee or transferees of any of them permitted by Section 2(a) below. Such
term, when used in this Warrant Agreement in reference to or in the context of a
person who holds or owns shares of Common Stock issued upon exercise of a
Warrant, refers where appropriate to such person who holds or owns such shares
of Common Stock.

1. Representations and Warranties.

         The Company represents and warrants to you as follows:

(a)               Corporate and Other Action.  The Company has all requisite
        power and authority  (corporate and other),  and has taken
        all necessary corporate action, to authorize,  execute, deliver and
        perform this Warrant Agreement, to execute, issue, sell and
        deliver the Warrants and a certificate or  certificates  evidencing the
        Warrants,  to authorize and reserve for issue and, upon
        payment from time to time of the Purchase  Price,  to issue,  sell and
        deliver,  the shares of the Common Stock  issuable  upon
        exercise of the Warrants (the "Shares"),  and to perform all of its
        obligations  under this Warrant Agreement and the Warrants.
        The Shares,  when issued in accordance with this Agreement,  will be
        duly authorized and validly issued and outstanding,  fully
        paid and  nonassessable and free of all liens,  claims,  encumbrances
        and preemptive  rights.  This Warrant Agreement and, when
        issued,  each Warrant issued pursuant hereto,  has been or will be duly
        executed and delivered by the Company and is or will be
        a legal,  valid and binding  agreement of the Company,  enforceable in
        accordance with its terms. No  authorization,  approval,
        consent  or  other  order of any  governmental  entity,  regulatory
        authority  or  other  third  party  is  required  for such
        authorization, execution, delivery, performance, issue or sale.

(b)     No Violation. The execution and delivery of this Warrant Agreement, the
        consummation of the transactions herein contemplated and the compliance
        with the terms and provisions of this Warrant Agreement and of the
        Warrants will not conflict with, or result in a breach of, or constitute
        a default or an event permitting acceleration under, any statute, the
        Certificate of Incorporation or Bylaws of the Company or any indenture,
        mortgage, deed of trust, note, bank loan, credit agreement, franchise,
        license, lease, permit, or any other agreement, understanding,
        instrument, judgment, decree, order, statute, rule or regulation to
        which the Company is a party or by which it is or may be bound.

2.      Transfer.

(a)     Transferability of Warrants. You agree that the Warrants are being
        acquired as an investment and not with a view to distribution thereof
        and that the Warrants may not be transferred, sold, assigned or
        hypothecated except as provided herein and in compliance with all
        applicable securities and other laws.


<PAGE>


(a)     Registration of Shares. You agree not to make any sale or other
        disposition of the Shares except pursuant to a registration statement
        which has become effective under the Securities Act of 1933, as amended
        (the "Act"), setting forth the terms of such offering, the underwriting
        discount and commissions and any other pertinent data with respect
        thereto, unless you have provided the Company with an opinion of counsel
        reasonably acceptable to the Company that such registration is not
        required. Certificates representing the Shares, which are not registered
        as provided in Section 2, shall bear an appropriate legend and be
        subject to a "stop-transfer" order.

3.      Exercise of Warrants; Partial Exercise; Redemption.

(a)     Exercise Period. This Warrant is exercisable from the date hereof and
        expires on December 31, 2006. The Board of Directors reserves the right
        to extend the Exercise Period for up to 12 months.

(b)     Exercise in Full. Subject to Section 3(a), Warrants may be exercised in
        full by the Warrant holder by surrender of the Warrants, with the form
        of subscription at the end thereof duly executed by such Warrant holder,
        to the Company at its principal office, accompanied by payment, in cash
        or by certified or bank cashier's check payable to the order of the
        Company, in the amount obtained by multiplying the number of shares of
        the Common Stock represented by the respective Warrant or Warrants by
        the Purchase Price per share (after giving effect to any adjustments as
        provided in Section 5 below).

(c)               Partial  Exercise.  Subject to Section 3(a), each Warrant may
        be exercised in part by the Warrant holder by surrender
        of the Warrant,  with the form of subscription  at the end thereof duly
        executed by such Warrant  holder,  in the manner and at
        the place provided in Section 3(b) above,  accompanied by payment,  in
        cash or by certified or bank cashier's  check payable to
        the order of the Company,  in amount obtained by multiplying the number
        of shares of the Common Stock designated by the Warrant
        holder in the form of  subscription  attached  to the  Warrant by the
         Purchase  Price per share  (after  giving  effect to any
        adjustments as provided in Section 5 below).  Upon any such partial
        exercise,  the Company at its expense will forthwith issue
        and deliver to or upon the order of the Warrant  holder a new Warrant
        of like tenor,  in the name of the Warrant holder thereof
        or as the Warrant  holder (upon  payment by such  Warrant  holder of
        any  applicable  transfer  taxes) may request,  subject to
        Section  2(a),  calling in the  aggregate  for the  purchase of the
        number of shares of the Common Stock equal to the number of
        such shares called for on the face of the  respective  Warrant  (after
        giving  effect to any  adjustment  herein as provided in
        Section 5 below) minus the number of such shares designated by the
        Warrant holder in the aforementioned form of subscription.

(d)     Company to Reaffirm Obligations. The Company will, at the time of any
        exercise of any Warrant, upon the request of the Warrant holder,
        acknowledge in writing its continuing obligation to afford to such
        Warrant holder any rights to which such Warrant holder shall continue to
        be entitled after such exercise in accordance with the provisions of
        this Warrant Agreement; provided, however, that if the Warrant holder
        shall fail to make any such request, such failure shall not affect the
        continuing obligation of the Company to afford to such Warrant holder
        any such right.

         (e) Method of Redemption. If the closing bid price of the Common Stock
shall have equaled or exceeded 200% of the Purchase Price, as adjusted, for a
period of at least twenty (20) of the last thirty trading days at any time
during the term hereof, the Company may, in its sole discretion, redeem the
Warrants by paying Warrant holders $.01 per Warrant, provided such notice is
mailed to all Warrant holders not later than thirty (30) days after the end of
such period and prescribes a redemption date at least thirty (30) days but not
more than sixty (60) days thereafter. Warrant holders will be entitled to
exercise Warrants at any time up to the business day next preceding the
redemption date.


4. Delivery of Stock Certificates on Exercise.

         Any exercise of the Warrants pursuant to Section 3 shall be deemed to
have been effected immediately prior to the close of business on the date on
which the Warrants together with the subscription form and the payment for the
aggregate Purchase Price shall have been received by the Company. At such time,
the person or persons in whose name or names any certificate or certificates
representing the Shares or Other Securities (as defined below) shall be issuable
upon such exercise shall be deemed to have become the holder or holders of
record of the Shares or Other Securities so purchased. As soon as practicable
after the exercise of any Warrant in full or in part, and in any event within 10
days thereafter, the Company at its expense (including the payment by it of any
applicable issue taxes) will cause to be issued in the name of, and delivered to
the purchasing Warrant holder, a certificate or certificates representing the
number of fully paid and non-assessable shares of Common Stock or Other
Securities to which such Warrant holder shall be entitled upon such exercise,
plus in lieu of any fractional share to which such Warrant holder would
otherwise be entitled, cash in an amount determined pursuant to Section 6(h),
together with any other stock or other securities and property (including cash,
where applicable). The term "Other Securities" refers to any stock (other than
Common Stock), other securities or assets (including cash) of the Company or any
other person (corporate or otherwise) which the holders of the Warrants at any
time shall be entitled to receive, or shall have received, upon the exercise of
the Warrants, in lieu of or in addition to Common Stock, or which at any time
shall be issuable or shall have been issued in exchange for or in replacement of
Common Stock or Other Securities pursuant to Section 5 below or otherwise.

5. Adjustment of Purchase Price and Number of Shares Purchasable.

         The Purchase Price and the number of Shares are subject to adjustment
from time to time as set forth in this Section 5.

(a)               In case the Company shall at any time after the date of this
 Agreement (i) declare a dividend on the Common Stock in
        shares of its capital stock, (ii) subdivide the outstanding  Shares,
 (iii) combine the outstanding Common Stock into a smaller
        number of Common Stock, or (iv) issue any shares of its capital stock
        by  reclassification  of the Common Stock  (including any
        such  reclassification in connection with a consolidation or merger in
        which the Company is the continuing  corporation),  then
        in each case the Purchase  Price,  and the number and kind of Shares
        receivable  upon  exercise,  in effect at the time of the
        record  date for such  dividend  or of the  effective  date of such
         subdivision,  combination,  or  reclassification  shall be
        proportionately  adjusted  so that the  holder of any  Warrant
         exercised  after  such time shall be  entitled  to receive  the
        aggregate  number and kind of Shares which,  if such Warrant had been
        exercised  immediately  prior to such time, he would have
        owned  upon  such  exercise  and  been  entitled  to  receive  by
         virtue  of  such  dividend,  subdivision,   combination,  or
        reclassification.  Such adjustment shall be made successively whenever
         any event listed above shall occur.

(b)     No adjustment in the Purchase Price shall be required if such adjustment
        is less than $.05; provided, however, that any adjustments which by
        reason of this subsection (h) are not required to be made shall be
        carried forward and taken into account in any subsequent adjustment. All
        calculations under this Section 5 shall be made to the nearest cent or
        to the nearest one-thousandth of a share, as the case may be.

(c)     Upon each adjustment of the Purchase Price as a result of the
        calculations made in any of subsection (a) of this Section 5, each
        Warrant outstanding prior to the making of the adjustment in the
        Purchase Price shall thereafter evidence the right to purchase, at the
        adjusted Purchase Price, that number of Shares (calculated to the
        nearest thousandth) obtained by (i) multiplying the number of Shares
        purchasable upon exercise of a Warrant immediately prior to adjustment
        of the number of Shares by the Purchase Price in effect prior to
        adjustment of the Purchase Price and (ii) dividing the product so
        obtained by the Purchase Price in effect immediately after such
        adjustment of the Purchase Price.

(d)               In case of any capital  reorganization of the Company,  or of
        any  reclassification of the Common Stock (other than a
        reclassification  of the Common Stock referred to in subsection (a) of
        this Section 5), or in the case of the  consolidation of
        the Company with or the merger of the Company into any other
        corporation or of the sale,  transfer,  or lease of the properties
        and assets of the Company as, or substantially as, an entirety to any
         other corporation,  each Warrant shall after such capital
        reorganization,  reclassification of the Common Stock, consolidation,
         merger, sale, transfer, or lease be exercisable, upon the
        terms and conditions  specified in this Agreement,  for the number of
         shares of stock or other  securities,  assets, or cash to
        which a  holder  of the  number  of  shares  of  Common  Stock
        purchasable  (at  the  time  of  such  capital  reorganization,
        reclassification of shares,  consolidation,  merger,  sale,  transfer,
         or lease) upon exercise of such Warrant would have been
        entitled upon such capital  reorganization,  reclassification of the
         Common Stock,  consolidation,  merger, sale, transfer,  or
        lease; and in any such case, if necessary,  the provisions set forth in
         this Section 5 with respect to the rights and interests
        thereafter of the holders of the Warrants shall be appropriately
        adjusted so as to be applicable,  as nearly as may reasonably
        be, to any shares of stock or other securities,  assets, or cash
        thereafter  deliverable upon the exercise of the Warrants. The
        subdivision or combination of the Common Stock at any time  outstanding
          into a greater or lesser number of shares shall not be
        deemed to be a reclassification  of the Common Stock for the purposes
        of this paragraph.  The Company shall not effect any such
        consolidation,  merger,  transfer,  or lease,  unless prior to or
        simultaneously with the consummation  thereof,  the successor
        corporation (if other than the Company) resulting from such
        consolidation or merger or the corporation  purchasing,  receiving,
        or leasing such assets or other appropriate  corporation or entity
        shall assume, by written  instrument  executed and delivered
        to the Warrant  holder,  the  obligation to deliver to the Warrant
        holder such shares of stock,  securities,  or assets as, in
        accordance with the foregoing  provisions,  such holders may be
        entitled to purchase,  and to perform the other  obligations of
        the Company under this Warrant Agreement.

6.      Further Covenants of the Company.

(a)     Dilution or Impairments. The Company will not, by amendment of its
        certificate or articles of incorporation or through any reorganization,
        transfer of assets, consolidation, merger, dissolution, issue or sale of
        securities or any other voluntary action, avoid or seek to avoid the
        observance or performance of any of the terms of the Warrants or of this
        Warrant Agreement, but will at all times in good faith assist in the
        carrying out of all such terms and in the taking of all such action as
        may be necessary or appropriate in order to protect the rights of the
        Warrant holders against dilution or other impairment. Without limiting
        the generality of the foregoing, the Company:

(i)     shall at all times reserve and keep available, solely for issuance and
        delivery upon the exercise of the Warrants, all shares of Common Stock
        (or Other Securities) from time to time issuable upon the exercise of
        the Warrants and shall take all necessary actions to ensure that the par
        value per share, if any, of the Common Stock (or Other Securities) is at
        all times equal to or less than the then effective Purchase Price per
        share;

(ii)    will take all such action as may be necessary or appropriate in order
        that the Company may validly and legally issue fully paid and
        nonassessable shares of Common Stock or Other Securities upon the
        exercise of the Warrants from time to time outstanding;

(iii)   will not issue any capital stock of any class which is preferred as to
        dividends or as to the distribution of assets upon voluntary or
        involuntary dissolution, liquidation or winding-up, unless the rights of
        the holders thereof shall be limited to a fixed sum or percentage of par
        value in respect of participation in dividends and in any such
        distribution of assets; and

(iv)    will not transfer all or substantially all of its properties and assets
        to any person (corporate or otherwise), or consolidate with or merge
        into any other person or permit any such person to consolidate with or
        merge into the Company (if the Company is not the surviving
        corporation), unless such other person shall expressly assume in writing
        and will be bound by all the terms of this Warrant Agreement and the
        Warrants.

(b)     Title to Stock. All shares of Common Stock delivered upon the exercise
        of the Warrants shall be validly issued, fully paid and nonassessable;
        each Warrant holder shall, upon such delivery, receive good and
        marketable title to the Shares, free and clear of all voting and other
        trust arrangements, liens, encumbrances, equities and claims whatsoever;
        and the Company shall have paid all taxes, if any, in respect of the
        issuance thereof.

(c)     Remedies. The Company stipulates that the remedies at law of the Warrant
        holder or any holder of Shares in the event of any default or threatened
        default by the Company in the performance of or compliance with any of
        the terms of this Warrant Agreement or the Warrants are not and will not
        be adequate and that such terms may be specifically enforced by a decree
        for the specific performance of any agreement contained herein or in the
        Warrants or by an injunction against a violation of any of the terms
        hereof or thereof or otherwise.

(d)     Exchange of Warrants. Subject to Section 2(a) hereof, upon surrender for
        exchange of any Warrant to the Company, the Company at its expense will
        promptly issue and deliver to or upon the order of the holder thereof a
        new Warrant or like tenor, in the name of such holder or as such holder
        (upon payment by such Warrant holder of any applicable transfer taxes)
        may direct, calling in the aggregate for the purchase of the number of
        shares of the Common Stock called for on the face or faces of the
        Warrant or Warrants so surrendered. The Warrants and all rights
        thereunder are transferable in whole or in part upon the books of the
        Company by the registered holder thereof, subject to the provisions of
        Section 2(a), in person or by duly authorized attorney, upon surrender
        of the Warrant, duly endorsed, at the principal office of the Company.

(e)     Replacement of Warrants. Upon receipt of evidence reasonably
        satisfactory to the Company of the loss, theft, destruction or
        mutilation of any Warrant and, in the case of any such loss, theft or
        destruction, upon delivery of an indemnity agreement reasonably
        satisfactory in form and amount to the Company or, in the case of any
        such mutilation, upon surrender and cancellation of such Warrant, the
        Company, at the expense of the Warrant holder, will execute and deliver,
        in lieu thereof, a new Warrant of like tenor.

(f)     Reporting by the Company. The Company agrees that during the term of the
        Warrants it will use its best efforts to keep current in the filing of
        all forms and other materials, if any, which it may be required to file
        with the appropriate regulatory authority pursuant to the Securities
        Exchange Act of 1934, as amended (the "Exchange Act"), and all other
        forms and reports required to be filed with any regulatory authority
        having jurisdiction over the Company.

(g)               Fractional  Shares.  No  fractional  Shares are to be issued
        upon the exercise of any Warrant,  but the Company shall
        pay a cash  adjustment  in respect of any  fraction  of a share which
        would  otherwise  be issuable in an amount  equal to such
        fraction  multiplied by the closing price which shall be the last
         reported sales price regular way or, in case no such reported
        sales  takes  place on such day,  the  average of the closing bid and
        asked  prices  regular  way,  on the  principal  national
        securities  exchange in the United States on which the Common Stock is
        listed or admitted to trading, or if the Common Stock is
        not listed or admitted to trading on any such national securities
        exchange,  the average of the highest reported bid and lowest
        reported  asked price as furnished by the National  Association of
         Securities  Dealers,  Inc.  through its automated  quotation
        system ("Nasdaq") or a similar organization if Nasdaq is no longer
         reporting such information.

7.      Other Warrant Holders: Holders of Shares.

         The Warrants are issued upon the following terms, to all of which each
Warrant holder by the taking thereof consents and agrees: (a) any person who
shall become a transferee, within the limitations on transfer imposed by Section
2(a) hereof, of a Warrant properly endorsed shall take such Warrant subject to
the provisions of Section 2(a) hereof and thereupon shall be authorized to
represent himself as absolute owner thereof and, subject to the restrictions
contained in this Warrant Agreement, shall be empowered to transfer absolute
title by endorsement and delivery thereof to a permitted bona fide purchaser for
value; (b) any person who shall become a holder or owner of Shares shall take
such shares subject to the provisions of Section 2(b) hereof; (c) each prior
taker or owner waives and renounces all of his equities or rights in such
Warrant in favor of each such permitted bona fide purchaser, and each such
permitted bona fide purchaser shall acquire absolute title thereto and to all
rights presented thereby; and (d) until such time as the respective Warrant is
transferred on the books of the Company, the Company may treat the registered
holder thereof as the absolute owner thereof for all purposes, notwithstanding
any notice to the contrary.

8. Miscellaneous.

         All notices, certificates and other communications from or at the
request of the Company to any Warrant holder shall be mailed by first class,
registered or certified mail, postage prepaid, to such address as may have been
furnished to the Company in writing by such Warrant holder, or, until an address
is so furnished, to the address of the last holder of such Warrant who has so
furnished an address to the Company, except as otherwise provided herein. This
Warrant Agreement and any of the terms hereof may be changed, waived, discharged
or terminated only by an instrument in writing signed by the party against which
enforcement of such change, waiver, discharge or termination is sought. This
Warrant Agreement shall be construed and enforced in accordance with and
governed by the laws of the State of Texas. The headings in this Warrant
Agreement are for purposes of reference only and shall not limit or otherwise
affect any of the terms hereof. This Warrant Agreement, together with the forms
of instruments annexed hereto as exhibits, constitutes the full and complete
agreement of the parties hereto with respect to the subject matter hereof.


<PAGE>



         IN WITNESS WHEREOF, the Company has caused this Warrant Agreement to be
executed in Houston, Texas, by its proper corporate officers, thereunto duly
authorized as of the date set forth below.

                     AMERICAN SECURITY RESOURCES CORPORATION


                  By: ___________________________________
                      L. EDWARD PARKER
                      CEO

                    Dated:_________________________________

The above Warrant Agreement is confirmed as of the date hereof.
(to be Witnesses by AMERICAN SECURITY RESOURCES CORPORATION)


By:_________________________________

Printed Name: ________________________

Title:________________________________



<PAGE>


EXHIBIT 4-4


<PAGE>




EXHIBIT 14H - CODE OF ETHICS
------------------------------------------------

                     AMERICAN SECURITY RESOURCES CORPORATION
                       CODE OF BUSINESS CONDUCT AND ETHICS

         The Board of Directors of AMERICAN SECURITY RESOURCES CORPORATION (with
its subsidiaries, the "Company") has adopted this code of conduct and ethics
(this "Code") to:

|X|      promote honest and ethical conduct, including fair dealing and the
ethical handling of conflicts of interest;

|X|      promote full, fair, accurate, timely, and understandable disclosure;

|X|      promote compliance with applicable laws and governmental rules and
regulations;

|X|      ensure  the  protection  of the  Company's  legitimate  business
interests,  including  corporate  opportunities,  assets and
                  confidential information; and

|X|      deter wrongdoing.

         All directors, officers and employees of the Company are expected to be
familiar with the Code and to adhere to those principles and procedures set
forth in the Code that apply to them.

         For purposes of this Code, the "Code of Ethics Contact Person" will be
different for various employees. For all directors and executive officers, the
Code of Ethics Contact Person shall be the Company's Chief Financial Officer.
For all other employees, the Code of Ethics Contact Person shall be the
Company's Chief Executive Officer.

         From time to time, the Company may waive some provisions of this Code.
Any waiver of the Code for executive officers or directors of the Company may be
made only by the Board of Directors. Any waiver for other employees may be made
only by the Chief Executive Officer.

I.       Honest and Candid Conduct

         Each director, officer and employee owes a duty to the Company to act
with integrity. Integrity requires, among other things, being honest and candid.
Deceit and subordination of principle are inconsistent with integrity.

         Each director, officer and employee must:

|X|               Act with integrity, including being honest and candid while
                  still maintaining the confidentiality of information where
                  required or consistent with the Company's policies.

|X| Observe both the form and spirit of laws and governmental rules and
regulations, accounting standards and Company policies.

|X|      Adhere to a high standard of business ethics.

II.      Conflicts of Interest

         A "conflict of interest" occurs when an individual's private interest
interferes or appears to interfere with the interests of the Company. A conflict
of interest can arise when a director, officer, or employee takes actions or has
interests that may make it difficult to perform his or her Company work
objectively and effectively. For example, a conflict of interest would arise if
a director, officer, or employee, or a member or his or her family, receives
improper personal benefits as a result of his or her position in the Company.
Any material transaction or relationship that could reasonably be expected to
give rise to a conflict of interest should be discussed with the Code of Ethics
Contact Person.

         Service to the Company should never be subordinated to personal gain
and advantage. Conflicts of interest should, wherever possible, be avoided. In
particular, clear conflict of interest situations involving directors, executive
officers, and other employees who occupy supervisory positions may include the
following:

|X|    any significant ownership interest in any material supplier or customer;

|X|      any consulting or employment relationship with any customer, supplier,
 or competitor;

|X|      the  receipt of  non-nominal  gifts or  excessive  entertainment  from
 any  company  with  which the  Company  has  current or
                  prospective business dealings;

|X|      being in the  position  of  supervising,  reviewing  or having any
influence  on the job  evaluation,  pay, or benefit of any
                  immediate family member; and

|X|               selling anything to the Company or buying anything from the
                  Company, except on the same terms and conditions as comparable
                  directors, officers, or employees are permitted to so purchase
                  or sell.

         Such situations, if material, should always be discussed with the Code
of Ethics Contact Person. Anything that would present a conflict for a director,
officer, or employee would likely also present a conflict if it is related to a
member of his or her family.

III.     Disclosure

         Each director, officer, or employee involved in the Company's
disclosure process, including the Chief Executive Officer, the Chief Financial
Officer, the Chief Accounting Officer, the controller, and such other finance,
accounting, tax or internal audit personnel as the Chief Executive Officer or
Chief Financial Officer may from time to time designate (the "Senior Financial
Officers"), is required to be familiar with and comply with the Company's
disclosure controls and procedures and internal control over financial
reporting, to the extent relevant to his or her area of responsibility, so that
the Company's public reports and documents filed with the Securities and
Exchange Commission ("SEC") comply in all material respects with the applicable
federal securities laws and SEC rules. In addition, each such person having
direct or supervisory authority regarding these SEC filings or the Company's
other public communications concerning its general business, results, financial
condition and prospects should, to the extent appropriate within his or her area
of responsibility, consult with other Company officers and employees and take
other appropriate steps regarding these disclosures with the goal of making
full, fair, accurate, timely, and understandable disclosure.

         Each director, officer, or employee who is involved in the Company's
disclosure process, including without limitation the Senior Financial Officers,
must:

|X|               Familiarize himself or herself with the disclosure
                  requirements applicable to the Company as well as the business
                  and financial operations of the Company.

|X|               Not knowingly misrepresent, or cause others to misrepresent,
                  facts about the Company to others, whether within or outside
                  the Company, including to the Company's independent auditors,
                  governmental regulators, and self-regulatory organizations.

|X|               Properly review and critically analyze proposed disclosure for
                  accuracy and completeness (or, where appropriate, delegate
                  this task to others).

IV.      Compliance

         It is the Company's policy to comply with all applicable laws, rules,
and regulations. It is the personal responsibility of each employee, officer,
and director to adhere to the standards and restrictions imposed by those laws,
rules, and regulations. In performing his or her duties, each employee, officer,
and director will endeavor to comply, and take appropriate action within his or
her areas of responsibility to cause the Company to comply, with applicable
governmental laws, rules, and regulations and applicable rules and regulations
of self-regulatory organizations.

         It is against Company policy and in many circumstances illegal for a
director, officer, or employee to profit from undisclosed information relating
to the Company or any other company. Any director, officer, or employee may not
purchase or sell any of the Company's securities while in possession of material
nonpublic information relating to the Company. Also, any director, officer, or
employee may not purchase or sell securities of any other company while in
possession of any material non-public information relating to that company.

         Any director, officer, or employee who is uncertain about the legal
rules involving a purchase or sale of any Company securities or any securities
in companies that he or she is familiar with by virtue of his or her work for
the Company, should consult with the Code of Ethics Contact Person before making
any such purchase or sale.

V.       Reporting and Accountability

         The Board of Directors and Audit Committee are responsible for applying
this Code to specific situations in which questions are presented to it and has
the authority to interpret this Code in any particular situation. Any director,
officer, or employee who becomes aware of any existing or potential violation of
this Code is required to notify the Code of Ethics Contact Person promptly.
Failure to do so is itself a violation of this Code.

         Any questions relating to how this Code should be interpreted or
applied should be addressed to the Code of Ethics Contact Person. A director,
officer, or employee who is unsure of whether a situation violates this Code
should discuss the situation with the Code of Ethics Contact Person to prevent
possible misunderstandings and embarrassment at a later date.

         Each director, officer, or employee must:

|X| Notify the Code of Ethics Contact Person promptly of any existing or
potential violation of this Code.

|X|               Not retaliate against any other director, officer, or employee
                  for reports of potential violations that are made in good
                  faith.

         The Audit Committee or Chief Financial Officer shall take all action
they consider appropriate to investigate any violations reported to them. If a
violation has occurred, the Company will take such disciplinary or preventive
action as it deems appropriate, after consultation with the Audit Committee, in
the case of a director or executive officer, or Chief Financial Officer, in the
case of any other employee.

         The Company will follow the following procedures in investigating and
enforcing this Code, and in reporting on the Code:

|X|               Violations and potential violations will be reported by the
                  Code of Ethics Contact Person to the Audit Committee, in the
                  case of a violation by a director or executive officer, or the
                  Chief Financial Officer, in the case of a violation by any
                  other employee, after appropriate investigation.

|X|               The Audit Committee and the Chief Financial Officer will take
                  all appropriate action to investigate any violations reported
                  to them after appropriate investigation.

|X|               If the Audit Committee and the Chief Financial Officer
                  determines that a violation has occurred, they will inform the
                  Board of Directors, in the case of a violation by a director
                  or executive officer, or the Chief Executive Officer in the
                  case of a violation by any other employee.

         Upon being notified that a violation has occurred, the Board of
Directors or the Chief Executive Officer will take such disciplinary or
preventive action as it deems appropriate, up to and including dismissal or, in
the event of criminal or other serious violations of law, notification of
appropriate governmental authorities.

         From time to time, the Company may waive some provisions of this Code.
Any waiver of the Code for executive officers or directors of the Company may be
made only by the Board of Directors. Any waiver for other employees may be made
only by the Chief Financial Officer.

VI.      Corporate Opportunities

         Directors, officers, and employees owe a duty to the Company to advance
the Company's business interests when the opportunity to do so arises.
Directors, officers, and employees are prohibited from taking (or directing to a
third party) a business opportunity that is discovered through the use of
corporate property, information, or position, unless the Company has already
been offered the opportunity and turned it down. More generally, directors,
officers, and employees are prohibited from using corporate property,
information, or position for personal gain and from competing with the Company.
Sometimes the line between personal and Company benefits is difficult to draw,
and sometimes there are both personal and Company benefits in certain
activities. Directors, officers, and employees who intend to make use of Company
property or services in a manner not solely for the benefit of the Company
should consult beforehand with the Code of Ethics Contact Person.

VII.     Confidentiality

         In carrying out the Company's business, directors, officers, and
employees often learn confidential or proprietary information about the Company,
its customers, suppliers, or joint venture parties. Directors, officers, and
employees must maintain the confidentiality of all information so entrusted to
them, except when disclosure is authorized or legally mandated. Confidential or
proprietary information of the Company, and of other companies, includes any
non-public information that would be harmful to the relevant company or useful
or helpful to competitors if disclosed.


VIII.    Fair Dealing

         We have a history of succeeding through honest business competition. We
do not seek competitive advantages through illegal or unethical business
practices. Each director, officer, and employee should endeavor to deal fairly
with the Company's customers, service providers, suppliers, competitors, and
employees. No director, officer, or employee should take unfair advantage of
anyone through manipulation, concealment, abuse of privileged information,
misrepresentation of material facts, or any unfair dealing practice.

IX.      Protection and Proper Use of Company Assets

All directors, officers and employees should protect the Company's assets and
ensure their efficient use. All Company assets should be used only for
legitimate business purposes.



<PAGE>




                                   SIGNATURES


AMERICAN SECURITY RESOURCES CORPORATION

Date:


<PAGE>




                              FORM OF CERFITICATION
                       PURSUANT TO RULE 13a-14 AND 15d-14
              UNDER THE SECURITIES EXCHAGE ACT OF 1934, AS AMENDED

CERTIFICATION

I, Robert C. Farr, certify that:

1.   I have reviewed this annual report on Form 10-KSB of AMERICAN SECURITY
     RESOURCES CORPORATION
2.   Based on my knowledge, this annual report does not contain any untrue
     statement of material fact or omit to state a material fact necessary to
     make the statements made, in light of the circumstances under which such
     statements were made, not misleading with respect to the period covered by
     this annual report;
3.   Based on my knowledge, the financial statements, and other financial
     information included in this annual report, fairly present in all material
     respects the financial condition, results of operations and cash flows of
     the registrant as of, and for, the periods presented in this annual report;
4.   The registrant's other certifying officer and I are responsible for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
        (a)       designed such disclosure controls and procedures to ensure
                  that material information relating to the registrant,
                  including its consolidated subsidiaries, is made known to us
                  by others within those entities, particularly during the
                  period in which this annual report is being prepared;
        (b)       evaluated the effectiveness of the registrant's disclosure
                  controls and procedures as of a date within 90 days of the
                  filing date of this annual report (the "Evaluation Date"); and
(c)               presented in this quarterly report our conclusions about the
                  effectiveness of the disclosure controls and procedures based
                  on our evaluation as of the evaluation date.
(d)               The registrant's other certifying officer and I have
                  disclosed, based on our most recent evaluation, to the
                  registrant's auditors and the audit committee of the
                  registrant's board of directors (or persons performing the
                  equivalent functions):
           (a)    all significant deficiencies in the design or operation of
                  internal controls which could adversely affect the
                  registrant's ability to record, process, summarize, and report
                  financial data and have identified for the registrant's
                  auditors any material weaknesses in internal controls; and
           (b)    any fraud, whether or not material, that involves management
                  or other employees who have a significant role in the
                  registrant's internal controls.
6.   The registrant's other certifying officer and I have indicated in this
     annual report whether or not there were significant changes in internal
     controls or in other factors that could significantly affect internal
     controls subsequent to the date of our most recent evaluation, including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.


Date:    /s/Robert C. Farr
      --------------------------------------------------------
        Name:  Robert C. Farr
        Title: President


<PAGE>





                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of ASRC Network Securities, Inc. formerly
Computer Automation Systems, Inc. on Form 10-K for the period ended December 31,
2003 as filed with the Securities and Exchange Commission on the date hereof
(the "Report"), each of the undersigned, in the capacities and on the dates
indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of
his knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of
the Securities Exchange Act of 1934; and 2. The Information contained in the
Report fairly presents, in all material respects, the financial condition and
results of
         the operation of the Company.