U.S.SECURITIES AND EXCHANGE COMMISSION

Washington,D.C. 20549

 

FORM 10-KSB

 

ANNUALREPORT PURSUANT TO SECTION 13 OR 15(D) 

OF THESECURITIES EXCHANGE ACT OF1934

 

FOR THEFISCAL YEAR ENDED DECEMBER 31, 2006

 

OKANAVENTURES, INC.

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

(Name ofSmall Business Issuer in its charter)

 

**
Nevada
333-138146
20-2881151
State or other jurisdiction of incorporation
Commission File Number
IRS Identification No.
 

7071 Jasper Drive

Vernon, British Columbia

Canada, V1H 1P2

(250) 545-0383

(Address and telephone number of principal executive offices)

 

Nevada Corporate Headquarters, Inc.

#700 - 101 Convention Center Drive

Las Vegas, Nevada 89109

(702) 873-3488

(Name, address and telephone numbers of agent for service)

 

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

None

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

Title of Class: Common Stock

Check whether the issuer is not required to file reports pursuant to Section13 or 15(d) of the Exchange Act. [ ]

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

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

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

Revenues for the fiscal year ended December 31, 2006 were: nil

The aggregate market value of the voting and non-voting common equity held bynon-affiliates computed by reference to the average bid and asked price of suchcommon equity as of December 31, 2006: The Company's common stock is notcurrently traded

Number of shares of common stock, $0.0001 par value per share, of theregistrant outstanding as of December 31, 2006: 850,000

DOCUMENTS INCORPORATED BY REFERENCE

No documents are incorporated herein by reference.

Transitional Small Business Issuer Format Yes [ ] No [X]

 

PART I.

ITEM 1. DESCRIPTION OF BUSINESS

Okana Ventures, Inc. ("Okana" or "the Company") wasincorporated on May 9, 2005, in the State of Nevada. We are an exploration stagecorporation. An exploration stage corporation is one engaged in the search formineral deposits or reserves which are not in either the development orproduction stage. We intend to conduct exploration activities on one property.Recorded title to the property upon which we intend to conduct explorationactivities is not held in our name. Title to the property is recorded in thename of Ronnie Birch, our president, who holds the property in trust for Okana.This property is located in British Columbia, Canada, and consists of three (3)mining claims, comprising 722.655 hectares. We intend to explore for gold on theproperty.

To date we have not performed any work on the property. Weare presently in the exploration stage and we cannot guarantee that acommercially viable mineral deposit exists in the property until furtherexploration is completed and a comprehensive evaluation determines if it haseconomic feasibility. 

We have no revenues, have achieved losses since inception,have no operations, have been issued a going concern opinion by our auditors andrely upon the sale of our securities and loans from our officers and directorsto fund operations.

Our business is subject to the risks inherent with a naturalresource based company in its early exploration stage of development. Theserisks include, but are not limited to: limited capital resources; limitedindustry operating experience; possible delays due to such things as weather,manpower and equipment shortage and regulatory processing practices; possiblecost overruns due to price increases in services, supplies and equipment; andthe general speculative nature of exploring a raw mineral property for minerals.

At the present, we have no employees and only three officersand directors, each of whom plan to devote only four hours per week to ouroperations.

There is currently no public trading market for the sharesbeing offered.

Our administrative office is located at 7071 Jasper Drive,Vernon, British Columbia, Canada V1H 1P2 and our telephone number is (250)545-0383. Our registered statutory office is located at #700-101 ConventionCenter Drive, Las Vegas, Nevada 89109. Our fiscal year end is December 31. Ourmailing address is 7071 Jasper Drive, Vernon, British Columbia, Canada V1H 1P2.

ITEM 2. PROPERTIES 

We have our corporate offices at 7071 Jasper Drive, Vernon, British Columbia,Canada, V1H 1P2. This space is provided rent free by one of our officers.

On May 27, 2005, we entered into an agreement to purchase amineral property, known as the "Westmoreland Property", comprising three (3)mining claims located in British Columbia, Canada, from Roger William MacInnisand Warner Gruenwald, jointly, both of whom are non-affiliated third parties.The purchase price for the Westmoreland Property is CAD $40,000 and is payablein staged payments to Messrs. MacInnis and Gruenwald consisting of: CAD $5,000on signing, which has been paid, an additional CAD $5,000 one year from signingwhich also has been paid, CAD $10,000 two years after signing, and a finalpayment on the third anniversary of signing of CAD $20,000. In addition, we arerequired to make property exploration expenditures of CAD $60,000 over a fouryear period, with CAD $30,000 of exploration expenditures to be performed by thesecond anniversary date. We can, in our sole discretion, pay cash to Messrs.MacInnis and Gruenwald in lieu of performing part or all of the CAD $60,000exploration expenditures. On March 29, 2006, we paid a CAD $3,180 maintenancefee to the Government of British Columbia on the mineral property. We arerequired to pay a similar fee each year thereafter until such time as we areable to perform exploration work on the mining property that can be creditedtoward future required maintenance fees. We are also required to pay a royaltyof 2% on all mineral commodities sold from the claim. This royalty can bereduced to 1% upon payment of CAD $500,000 at anytime. In the event we defaultin making any cash payments or exploration expenditures as required under thepurchase agreement and such default continues for 30 days after notice to Okana,or if Okana has given the vendors 30 days notice of its intention to terminatethe agreement, the mineral property will revert back to the vendors. 

Title to the mining claims upon which we intend to conductexploration activities is not recorded in our name. Title to the property isrecorded in the name of Ronnie Birch, our president. Under British Columbia law,title to British Columbia mining claims can only be held by Canadian residents.In the case of corporations, title must be held by a Canadian corporation. Inorder for us to record title to the property we would have to incorporate aCanadian wholly owned subsidiary corporation. We believe that the costs ofincorporating a subsidiary corporation are unwarranted at this stage of ourdevelopment. Accordingly, we have elected not to create the subsidiary at thistime; but will do so if mineralized material is discovered on the mining claims.

Our mining claims are issued pursuant to the Minerals TenureAct of the Province of British Columbia. As the beneficial owner of the claims,we have exclusive rights to mine and recover all of the minerals containedwithin the surface boundaries of the property and continuing verticallydownward.

The mining claims are unencumbered and there are nocompetitive conditions which affect the property. There are no native landclaims that affect title to the property. We have no insurance covering themining claims and we believe that no insurance is necessary since the propertyis unimproved and contains no buildings or improvements.

In order to maintain these claims we must pay a fee of CAD$3,180 per year for all 3 claims or provide evidence that CAD $3,180 worth ofwork was done on the property.

Investment Policies. There are no restrictions orlimitations on the percentage of assets which the Company may invest in realestate or interests in real estate, investments in real estate mortgages, orsecurities of or interests in persons primarily engaged in real estateactivities.

ITEM 3. LEGAL PROCEEDINGS 

The Company is not involved in any legal proceedings.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

There were no matters submitted to a vote of security holders.

PART II.

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDERSMATTERS. 

The Company's common stock does not currently trade on any exchange.

At the present time, there are no assets available for the payment ofdividends. The Company does not anticipate paying any dividends in the nexttwelve months.

The Company's Articles of Incorporation currently authorizethe issuance of 100,000,000 shares of common stock, with a par value of $0.0001.The stockholders: (a) have equal ratable rights to dividends from funds legallyavailable therefore, when, as, and if declared by the Board of Directors of theCompany; (b) are entitled to share ratably in all of the assets of the Companyavailable for distribution upon winding up of the affairs of the Company; (c) donot have preemptive subscription or conversion rights and there are noredemption or sinking funds applicable thereto; and (d) are entitled to onenon-cumulative vote per share on all matters on which shareholders may vote atall meetings of shareholders. These securities do not have any of the followingrights: (a) cumulative or special voting rights; (b) preemptive rights topurchase in new issues of shares; (c) preference as to dividends or interest;(d) preference upon liquidation; or (e) any other special rights or preferences.In addition, the shares are not convertible into any other security. There areno restrictions on dividends under any loans, other financing arrangements orotherwise. See a copy of the Articles of Incorporation, Bylaws of the Company,and any amendments thereto, attached as exhibits to the Company's previouslyfiled SB-2. As of December 31, 2006, the Company had 850,000 shares of commonstock outstanding.

Non-Cumulative Voting.

The common stockholders of the Company do not have cumulative voting rights,which means that the stockholders which hold more than 50% of such outstandingshares, voting for the election of directors, can elect all of the directors tobe elected, if they so choose. In such event, the holders of the remainingshares will not be able to elect any of the Company's directors. 

Share Purchase Warrants

At December 31, 2006, no share purchase warrants were outstanding.

Share Purchase Option

At December 31, 2006, there were no share purchase options outstanding. 

Dividends.

The Company does not currently intend to pay cash dividends. The Company'sproposed dividend policy is to make distributions of its revenues to itsstockholders when the Company's Board of Directors deems such distributionsappropriate. Because the Company does not intend to make cash distributions,potential shareholders would need to sell their shares to realize a return ontheir investment. There can be no assurances of the projected values of theshares, nor can there be any guarantees of the success of the Company. Adistribution of revenues will be made only when, in the judgment of theCompany's Board of Directors, it is in the best interest of the Company'sstockholders to do so. The Board of Directors will review, among other things,the investment quality and marketability of the securities considered fordistribution; the impact of a distribution of securities on its customers, jointventure associates, management contracts, other investors, financialinstitutions, and the company's internal management, plus the tax consequencesand the market effects of an initial or broader distribution of such securities.

Transfer Agent.

The Company continues to retain the services of Pacific Stock TransferCompany, 500 E. Warm Springs Road, Suite 240, Las Vegas, NV 89119, to act astransfer agent and registrar.

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION ANDRESULTS OF OPERATIONS.

This section includes a number of forward-looking statementsthat reflect our current views with respect to future events and financialperformance. Forward-looking statements are often identified by words like:believe, expect, estimate, anticipate, intend, project and similar expressions,or words which, by their nature, refer to future events. You should not placeundue certainty on these forward-looking statements, which apply only as of thedate of this report. These forward-looking statements are subject to certainrisks and uncertainties that could cause actual results to differ materiallyfrom historical results or our predictions.
**Plan of Operation**
We are a start up, exploration stage corporation and have notyet generated or realized any revenues from our business operations.

Our auditors have issued a going concern opinion. This meansthat there is substantial doubt that we can continue as an on-going business forthe next twelve months unless we obtain additional capital to pay our bills.This is because we have not generated any revenues and no revenues areanticipated until we begin removing and selling minerals. Accordingly, we mustraise cash from sources other than the sale of minerals found on the property.Our only other source for cash at this time is investments by others. We mustraise cash to implement our project and stay in business. If we raise the amountof money from our SB-2 offering, we believe those funds, together with the loansand purchase of shares by the directors ($17,105 in loans and $17,000 in sharepurchases) will provide us with funds to operate for the next twelve months.

We will be conducting research in the form of exploration ofthe property. We are not going to buy or sell any plant or significant equipmentduring the next twelve months.

The property is located in southern British Columbia, Canada,approximately 29 kilometers west of the City of Vernon . Access to the propertyis by paved highway and logging roads. Portions of the property have clear areasdue to recent logging and much of the property is covered by a network oflogging roads. No improvements are necessary for exploration activities.

Our exploration objective is to find an ore body containinggold. We must conduct exploration to determine what amount of minerals, if any,exist on our property and if any minerals which are found can be economicallyextracted and profitably processed. Our success depends upon finding mineralizedmaterial. Mineralized material is a mineralized body, which has been delineatedby appropriate spaced drilling or underground sampling to support sufficienttonnage and average grade of metals to justify removal. After that has occurredwe have to determine if it is economically feasible to remove the mineralizedmaterial. Economically feasible means that the costs associated with the removalof the mineralized material will not exceed the price at which we can sell themineralized material. We can not predict what that will be until we findmineralized material. If we do find mineralized material we may have to raiseadditional funds to continue our exploration of the property. If we have notraised enough money to continue our exploration program, we will try to raiseadditional funds from a second public offering, a private placement, or loans.At the present time, we have not made any plans to raise additional money.

To our knowledge, the property has never been mined. Based ona filed British Columbia assessment report (Assessment Report #17870) there wassome preliminary geophysical and geochemical work carried out on a portion ofwhat now comprises the Westmoreland property in 1988 by Getchell Resources;however, we know of no follow-up work on that portion of the property or anywork whatsoever on the balance of the Westmoreland property. The property wasclaimed by Roger William MacInnis and Warner Gruenwald, jointly, and wasexamined and reported on by Mr. Gruenwald, Professional Geologist, before beingacquired by us. 

We intend to implement an exploration program which consistsof geochemical stream, soil and rock sampling along with prospecting, geologicalmapping and geophysical surveys. Work will focus on prospecting the numerous newroads and clear cuts which may have exposed previously covered bedrock. Areas ofalteration, fault zones and especially quartz veining (float or in situ) will beexplored by establishing grids along which soil sampling will be conducted.Streams should be sampled by collecting silt and heavy mineral concentrates. Thesoil samples will be analyzed to determine if elevated amounts of minerals arepresent. The results will be plotted on a map to determine where the elevatedareas of mineralization occur. Rock samples and geological mapping andprospecting will be done by competent professionals. Preliminary geophysicalsurveying will also be done to try and locate anomalies which may be caused bymineralization not evident on the surface. We intend to take our samples toanalytical chemists, geochemists, and registered assayers in Vancouver, BritishColumbia. We have not selected any of the foregoing as of the date of thisreport. Based upon the results of the exploration, Mr. Birch will determine, inconsultation with our consultants, if the property warrants further explorationwork done. Mr. Birch will not receive fees for his services. The proceeds fromour offering are designed primarily to fund the costs of an exploration programrecommended by a professional geologist, Mr. Warner Gruenwald. Additionalfunding will be required to take the property to a more advanced stage ofexploration. 

We estimate the cost of the proposed work program to be$30,000. This is composed of $8,500 for geological mapping, $8,500 forgeochemical sampling, $3,000 for geophysical surveying, $4,500 for analysis,$4,000 for reports, and $1,500 for related travel costs. We estimate it willtake up to 20 days to complete the program. We will begin the program after thecompletion of our offering, weather permitting. We estimate our working capitalrequirements associated with the conduct of our exploration program to be$2,000. This is comprised of $1,000 for accounting, $750 for office and $250 forfiling.

We do not intend to hire any employees at this time. All ofthe work on the property will be conducted by unaffiliated independentcontactors that we will hire. Depending on the stage of exploration we reach,the independent contractors will be responsible for surveying, geology,engineering, exploration, and excavation. The geologists will evaluate theinformation derived from the exploration and excavation and the engineers willadvise us on the economic feasibility of removing any mineralized material wemay find. 

 
**Liquidity and Capital Resources**
To meet our need for cash we are attempting to raise moneyfrom the sale of stock that was registered pursuant to a Form SB-2, which becameeffective on November 8, 2006. If we do not raise all of the money we need fromthat offering to complete our exploration of the property, we will have to findalternative sources, such as a second public offering, a private placement ofsecurities or loans from our officers or others.

We have discussed this matter with our officers anddirectors, and Mr. Upham, one of our directors, has agreed to advance funds asneeded until the public offering is completed and Mr. Birch, our President hasagreed to pay the cost of reclamation of the property should mineralizedmaterial not be found thereon. Mr. Upham has advanced $17,105 to date. At thepresent time, we have not made any arrangements to raise additional cash, otherthan through our offering. We believe the funds raised in our current offering,together with the loans advanced, will allow the company to operate for aminimum of one year. Other than as described in this paragraph, we have no otherfinancing plans.

We acquired one property containing three claims. Theproperty is registered in the name of Mr. Birch, our President, who holds theproperty in trust for us. We expect to start exploration operations uponcompletion of this offering, weather permitting. As of the date of this reportwe have yet to begin operations. 

We issued 75,000 shares of common stock on May 10, 2005 for apurchase price of $1,500 and 775,000 shares of common stock on July 31, 2006 fora purchase price of $15,500. All of these shares were issued pursuant to theexemption from registration set forth in section 4(2) of the Securities Act of1933. Michael Upham, our Secretary/Treasurer, has provided us with various loanstotaling $17,105 for legal fees, audit fees, mineral property acquisition andworking capital. The amount owed to Mr. Upham is non-interest bearing, unsecuredand due on demand. Accordingly, the loans are classified as current liabilities,and we record interest at 6% per annum against additional paid-in capital.

As of December 31, 2006, our total assets were $6,986 and ourtotal liabilities were $18,441.

ITEM 7. FINANCIAL STATEMENTS

Included herewith are the following financial statements:
** 

 

 

 

 

 

 

 

 

 

 

 

OKANA VENTURES, INC.

(AN EXPLORATION STAGE COMPANY)

AUDITED FINANCIAL STATEMENTS

 

FOR THE YEARS ENDED DECEMBER 31, 2006 AND 2005 

AND 

THE PERIOD OF MAY 9, 2005 (INCEPTION) TO DECEMBER 31, 2006

 

 

 

 

 

 

 

 

 

 

 

 

OKANA VENTURES, INC.

(AN EXPLORATION STAGE COMPANY)

INDEX TO AUDITED FINANCIAL STATEMENTS

 

FOR THE YEARS ENDED DECEMBER 31, 2006 AND 2005

AND 

THE PERIOD OF MAY 9, 2005 (INCEPTION) TO DECEMBER 31, 2006

 

                                                                                                                Page(s)
Report of Independent Registered Public Accounting Firm                                                                                                                   1
**Balance Sheets as of December 31, 2006 and 2005                                                                                                                            2

Statements of Operations for the Years Ended December 31, 2006

    and 2005 with Cumulative Totals Since Inception                                                                                                                            3

 

Statement of Changes in Stockholders' Equity (Deficit) for the Period May 9,

    2005 (Inception) to December 31, 2006                                                                                                                                         4

 

Statements of Cash Flows for the Years Ended December 31, 2006

    and 2005 with Cumulative Totals Since Inception                                                                                                                            5

Notes to Financial Statements                                                                                                                                                            6-12
** 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 **
REPORT OF INDEPENDENT REGISTERED PUBLICACCOUNTING FIRM

To The Board of Directors and Stockholders of

Okana Ventures, Inc.

Vernon, British Columbia

Canada

We have audited the accompanying balance sheets of Okana Ventures, Inc. (anexploration stage company) (the Company) as of December 31, 2006 and 2005, andthe related statements of operations, cash flows, and changes in stockholders'equity (deficit) for the year ended December 31, 2006, the period of May 9, 2005(inception) to December 31, 2005, and for the period of May 9, 2005 (inception)to December 31, 2006. These financial statements are the responsibility of theCompany's management. Our responsibility is to express an opinion on thesefinancial statements based on our audit.

We conducted our audit in accordance with the standards of the Public CompanyAccounting Oversight Board (United States of America). Those standards requirethat we plan and perform the audit to obtain reasonable assurance about whetherthe financial statements are free of material misstatement. The company is notrequired to have, nor were we engaged to perform, an audit of its internalcontrol over financial reporting. Our audit included consideration of internalcontrol over financial reporting as a basis for designing audit procedures thatare appropriate in the circumstances, but not for the purpose of expressing anopinion on the effectiveness of the company's internal control over financialreporting. Accordingly, we express no such opinion. An audit also includesexamining, on a test basis, evidence supporting the amounts and disclosures inthe financial statements, assessing the accounting principles used andsignificant estimates made by management, as well as evaluating the overallfinancial statement presentation. We believe that our audit provides areasonable basis for our opinion. 

In our opinion, the financial statements referred to above present fairly, inall material respects, the financial position of Okana Ventures, Inc. as ofDecember 31, 2006 and 2005, and the results of its operations and its cash flowsfor the year ended December 31, 2006, the period of May 9, 2005 (inception) toDecember 31, 2005, and for the period of May 9, 2005 (inception) to December 31,2006, in conformity with accounting principles generally accepted in the UnitedStates of America. 

The accompanying financial statements have been prepared assuming that theCompany will continue as a going concern. As discussed in Note 8 to thefinancial statements, the Company has incurred significant net losses sinceinception. This raises substantial doubt about the Company's ability to meet itsobligations and to continue as a going concern. Management's plans in regard tothis matter are described in Note 8. The financial statements do not include anyadjustments that might result from the outcome of this uncertainty.

Child, Van Wagoner & Bradshaw, PLLC

Kaysville, Utah

February 23, 2007
**OKANA VENTURES, INC.

(AN EXPLORATION STAGE COMPANY)

BALANCE SHEETS

DECEMBER 31, 2006 AND 2005
                        ASSETS                December 31,       December 31,         2006       2005      Current Assets                   Cash and cash equivalents         $            4,843         $              1,258         Prepaid expenses                      2,143                             -                   Total Current Assets                      6,986                         1,258             TOTAL ASSETS         $            6,986         $              1,258                             LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)             LIABILITIES                 Current Liabilities                   Accounts payable         $            1,336         $                   -           Notes payable - stockholder (note 6)                     17,105                         6,063                   Total Current Liabilities                     18,441                         6,063                   Total Liabilities                     18,441                         6,063             STOCKHOLDERS' EQUITY (DEFICIT)                   Common stock, par value $.0001, 100,000,000 shares authorized and               850,000 and 75,000 shares, respectively, issued and outstanding                           85                               8         Additional paid-in capital                     17,847                         1,673         Cumulative currency translation adjustment                       (476)                         (342)        Deficit accumulated during the exploration stage                   (28,911)                      (6,144)                  Total Stockholders' Equity (Deficit)                   (11,455)                      (4,805)            TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)         $            6,986         $              1,258       
 

 

Theaccompanying notes are an integral part of these financial statements

2.

 
**OKANA VENTURES, INC.

(AN EXPLORATION STAGE COMPANY)

STATEMENTS OF OPERATIONS

FOR THE YEARS ENDED DECEMBER 31, 2006 AND 2005 

 

(WITH CUMULATIVE TOTALS SINCE INCEPTION)**                 Period of     Cumulative Total       Year Ended     May 9, 2005 to     From Inception,       December 31,     December 31,     May 9, 2005, to       2006     2005     December 31, 2006                    INCOME      $                 -       $                   -       $                            -             OPERATING EXPENSES                Organizational expenses                         -                     1,097      1,097           Mineral property costs                  7,215                     3,946      11,161           Office expenses                  1,167                        242      1,409           Professional fees                 12,707                            -      12,707           Outside services                     752                        678      1,430           Taxes and licenses                     175                            -      175             Total Operating Expenses                 22,016                     5,963                             27,979         
OTHER     INCOME (EXPENSE)          Interest expense     (751)     (181)     (932)             Total Other Income (Expense)                   (751)                     (181)                               (932)                    NET LOSS APPLICABLE TO COMMON SHARES      $       (22,767)      $           (6,144)      $                   (28,911)            NET LOSS PER BASIC AND DILUTED SHARES      $         (0.057)      $           (0.082)              WEIGHTED AVERAGE NUMBER OF COMMON               SHARES OUTSTANDING     397,917     75,000          
 

The accompanying notes are an integral part of these financialstatements.

3
**OKANA VENTURES, INC.

(AN EXPLORATION STAGE COMPANY)

STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)

FROM MAY 9, 2005 (INCEPTION) TO DECEMBER 31, 2006

 
                          Common Stock    Additional    Deficit Accumulated    Cumulative    Stockholders'    Shares     Amount    Paid-in Capital    During the Pre-    Currency Translation    Deficit                        Exploration Stage    Adjustment    (Equity)    Balance at May 9, 2005 (Inception)                         -         $                         -        $                        -        $                                  -        $                                 -        $                      -              Issuance of common stock for cash - May 10, 2005                  75,000                                   8                          1,492                                          -                                           -                          1,500     Interest expense - related party (note 6)                         -                                    -                               181                                          -                                           -                             181     Net loss                         -                                    -                                  -                                     (6,144)                                        -                         (6,144)    Cumulative currency translation adjustment                         -                                    -                                  -                                            -                                      (342)                         (342)    Balance at December 31, 2005                  75,000                                   8                          1,673                                   (6,144)                                   (342)                      (4,805)           Issuance of common stock for cash - July 31, 2006                775,000                                 77                        15,423                                          -                                           -                        15,500     Interest expense - related party (note 6)                         -                                    -                               751                                          -                                           -                             751     Net loss                         -                                    -                                  -                                   (22,767)                                        -                       (22,767)    Cumulative currency translation adjustment                         -                                    -                                  -                                            -                                      (134)                         (134)    Balance at December 31, 2006    850,000       $                        85      $                17,847      $                         (28,911)     $                            (476)     $             (11,455)       
 **
The accompanying notes are an integral part of these financialstatements

4
**OKANA VENTURES, INC.

(AN EXPLORATION STAGE COMPANY)

STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2006 AND 2005 

 

(WITH CUMULATIVE TOTALS SINCE INCEPTION)
             Year Ending       Period From       Cumulative Total From       December 31,       May 9, 2005 to       Inception, May 9, 2005       2006       December 31, 2005       to December 31, 2006            CASH FLOWS FROM OPERATING ACTIVITIES                Net income (loss)        $                 (22,767)        $                     (6,144)        $                          (28,911)          Adjustments to reconcile net loss to net cash                 provided by (used in) operating activities                 Interest expense - related party                                   751                                    181                                            932               Changes in operating assets and liabilities                 Increase in prepaid expenses                             (2,143)                                        -                                       (2,143)           Increase in accounts payable                               1,336                                         -                                         1,336                  Net cash used in operating activities                           (22,823)                               (5,963)                                    (28,786)            CASH FLOWS FROM INVESTING ACTIVITIES                       Net cash used in investing activities                                       -                                         -                                                 -             CASH FLOWS FROM FINANCING ACTIVITIES                Proceeds from notes payable - stockholder                             11,042                                 6,063                                       17,105           Sale of common stock                             15,500                                 1,500                                       17,000                    Net cash provided by financing activities                             26,542                                 7,563                                       34,105             EFFECT OF FOREIGN CURRENCY              TRANSLATION ADJUSTMENT                                (134)                                  (342)                                         (476)            NET INCREASE IN                CASH AND CASH EQUIVALENTS                               3,585                                 1,258                                         4,843             CASH AND CASH EQUIVALENTS -                BEGINNING OF PERIOD                               1,258                                         -                                                 -                               CASH AND CASH EQUIVALENTS -               END OF PERIOD        $                     4,843         $                      1,258         $                              4,843             SUPPLEMENTAL CASH FLOW INFORMATION:                 Cash paid for interest            $                                    -              Cash paid for taxes            $                                    -         
 

Theaccompanying notes are an integral part of these financial statements.

5
**OKANA VENTURES, INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2006 AND 2005****NOTE 1- ORGANIZATION AND BASIS OF PRESENTATION
The Company was incorporated on May 9, 2005 under the      laws of the State of Nevada. The business purpose of the Company is to      acquire and develop mineral properties.
**NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**Exploration Stage Company

The Company is considered to be in the exploration      stage as defined in Statement of Financial Accounting Standards (SFAS) No.      7, "*Accounting and Reporting by Development Stage Enterprises*" as      interpreted by the Securities and Exchange Commission for mining companies      in Industry Guide 7. The Company is devoting substantially all of its      efforts to development of business plans and the acquisition of mineral      properties.
**Use of Estimates**
The preparation of condensed financial statements in      conformity with accounting principles generally accepted in the United      States of America requires management to make estimates and assumptions      that affect the amounts reported in the financial statements and      accompanying notes. Actual results could differ from those estimates.
**Cash and Cash Equivalents**
Cash and cash equivalents consist principally of      currency on hand, demand deposits at commercial banks, and liquid      investment funds having a maturity of three months or less at the time of      purchase. The Company had $4,843 in cash and cash equivalents as of      December 31, 2006.

**Start-up Costs**
In accordance with the American Institute of Certified      Public Accountant's Statement of Position 98-5, "*Reporting on the Costs      of Start-up Activities*", the Company expenses all costs incurred in      connection with the start-up and organization of the Company.

6

 
**OKANA VENTURES, INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2006 AND 2005****NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
**                (CONTINUED)****Common Stock Issued For Other Than Cash

Services purchased and other transactions settled in      the Company's common stock are recorded at the estimated fair value of the      stock issued if that value is more readily determinable than the fair      value of the consideration received.
**Net Income or (Loss) Per Share of Common Stock**
The following table sets forth the computation of basic and diluted      earnings per share:

The Company has no potentially dilutive securities,      such as options or warrants, currently issued and outstanding.
**Recent Accounting Pronouncements**
In September 2006, the FASB issued SFAS No. 158, *"Employers'      Accounting for Defined Benefit Pension and Other Postretirement Plans - an      amendment of FASB Statements No. 87, 88, 106, and 132(R)."* This      statement improves financial reporting by requiring an employer to      recognize the overfunded or 

7
**OKANA VENTURES, INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2006 AND 2005**** 

NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
**                (CONTINUED)****Recent Accounting Pronouncements (Continued)

underfunded status of a defined benefit postretirement plan (other than      a multiemployer plan) as an asset or liability in its statement of      financial position and to recognize changes in that funded status in the      year in which the changes occur through comprehensive income of a business      entity or changes in unrestricted net assets of a not-for-profit      organization. Employers with publicly traded equity securities are      required to initially recognize the funded status of a defined benefit      postretirement plan and provide required disclosures as of the end of the      fiscal year ending December 15, 2006.

In September 2006, the FASB issued SFAS No. 157,*"Fair Value      Measurements."*This statement defines fair value, establishes a      framework for measuring fair value in generally accepted accounting      principles (GAAP), and expands disclosures about fair value measurements.      This statement is effective for financial statements issued for fiscal      years beginning after November 15, 2007. 

In March 2006, the FASB issued SFAS No. 156, *"Accounting for      Servicing of Financial Assets - an amendment of FASB Statement No. 140."*      This statement amends SFAS No. 140, *"Accounting for Transfers and      Servicing of Financial Assets and Extinguishments of Liabilities,"*      with respect to the accounting for separately recognized servicing assets      and servicing liabilities." This statement is effective as of the      beginning of its first fiscal year beginning after September 15, 2006.

In February 2006, the FASB issued SFAS No. 155*, "Accounting for      Certain Hybrid Financial Instruments - an amendment of FASB Statements No.      133 and 140."* This statement amends SFAS No. 133, *"Accounting for      Derivative Instruments and Hedging Activities,"* and No. 140, *"Accounting for Transfers and Servicing of Financial Assets and      Extinguishments of Liabilities."*This statement resolves issues      addressed in SFAS No. 133 Implementation Issue No. D1, *"Application of      Statement 133 to Beneficial Interest in Securitized Financial Assets."*      This statement is effective for all financial instruments acquired or      issued after the beginning of an entity's first fiscal year beginning      after September 15, 2006.

In May 2005, the FASB issued SFAS No. 154, *"Accounting Changes and      Error Corrections, a replacement of APB Opinion No. 20 and FASB Statement      No. 3."* This statement changes the requirements for the accounting for      and reporting of a change in accounting principle. Previously, Opinion 20      required that most voluntary changes in accounting principle be recognized      by including in net 

8
**OKANA VENTURES, INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2006 AND 2005**** 

NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
**(CONTINUED)
Recent Accounting Pronouncements (Continued)

income of the period of change the cumulative effect of changing to a      new principle. This statement requires retrospective application to prior      periods' financial statements of changes in accounting principle, when      practicable. 

In December 2004, the FASB issued Financial Accounting Standards No.      123 (revised 2004) (SFAS 123R), *"Share-Based Payment."* SFAS 123R      replaces SFAS No. 123, "Accounting for Stock-Based Compensation," and      supersedes APB Opinion No. 25, *"Accounting for Stock Issued to      Employees*." SFAS 123R requires compensation expense, measured as the      fair value at the grant date, related to share-based payment transactions      to be recognized in the financial statements over the period that an      employee provides service in exchange for the award. SFAS 123R is      effective January 1, 2006. 

None of the above new pronouncements has current application to the      Company but will be implemented in the Company's future financial      reporting when applicable.
**Mineral Acquisition and Exploration Costs**
The Company has been in the exploration stage since its formation May      9, 2005 and has not yet realized any revenue from its planned operations.      It is primarily engaged in the acquisition, exploration, and development      of mining properties. Mineral property acquisition and exploration costs      are expensed as incurred. When it has been determined that a mineral      property can be economically developed as a result of establishing proven      and profitable reserves, the costs incurred to develop such property are      capitalized. Such costs will be depreciated using the units-of-production      method over the estimated life of the probable reserve.******NOTE 3- PROVISION FOR INCOME TAXES
The Company recognizes the tax effects of transactions in the year in      which such transactions enter into the determination of net income      regardless of when reported for tax purposes. Deferred taxes are provided      in the financial statements under SFAS No. 109 to give effect to the      temporary differences which may arise from differences in the bases of      fixed assets, depreciation methods and allowances based on the income      taxes expected to be payable in future years. Minimal development stage      deferred tax assets arising as a result of net operating loss      carry-forwards have been offset completely by a valuation allowance due to      the uncertainty of their utilization in future periods. Operating loss      carry- forwards generated during the period from May 9, 2005 (date of      inception) through December 31, 2006 of approximately 

9
**OKANA VENTURES, INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2006 AND 2005

NOTE 3- PROVISION FOR INCOME TAXES (CONTINUED)
$28,911 will begin to expire in 2025. Accordingly, deferred tax assets      of approximately $10,120 were offset by the valuation allowance. For the      year ended December 31, 2006 the allowance increased by approximately      $8,000. 
**NOTE 4 -**STOCKHOLDERS' DEFICIT****Common Stock**
As of December 31, 2006 the Company has 100,000,000      shares of common stock authorized and 850,000 issued and outstanding.
***The following details the stock transactions for the      Company:***
On May 10, 2005 the Company sold 75,000 shares of its common stock at

$.02 per share for $1,500 cash to provide initial working capital.

On July 31, 2006 the Company sold 775,000 shares of its common stock at

$.02 per share for $15,500 cash for working capital.
**NOTE 5 - ACQUISITION OF MINERAL RIGHTS
On May 27, 2005 the Company entered into an agreement (the Agreement)      to purchase an undivided interest in mineral claims on property located in      Canada (the Property) for $40,000 CAD. Due to the uncertainty of      fluctuating exchange rates, payments on the Property are stated in CAD as      follows:

Upon signing of the Agreement and transfer of title (paid)                                         $ 5,000

On or before May 27, 2006 (paid)                                                                             5,000

On or before May 27, 2007                                                                                     10,000

On or before May 27, 2008                                                                                     20,000

                                                                                                                            -----------

                                                                                        TOTAL                        $ 40,000

                                                                                                                             ======

Under the Agreement, the Company is obligated to perform exploration      work of $60,000 CAD over a period of four years commencing on the date of      the Agreement or to make an equivalent cash payment to the vendors with      $30,000 CAD of the exploration work to be performed or an equivalent cash      payment made therefore by May 27, 2007. If the exploration results in the      discovery of mineral commodities, the Company is required to pay a royalty      of 2.0% on all mineral commodities sold from production on the Property.      The royalty may be 

10
**OKANA VENTURES, INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2006 AND 2005

NOTE 5 - ACQUISITION OF MINERAL RIGHTS (CONTINUED)
reduced to 1.0% upon payment of $500,000 CAD to the vendors at any      time. The Company is also responsible to maintain the mineral claims in      good standing by paying all the necessary rents, taxes and filings      associated with the Property.

In accordance with terms set forth in the Agreement, the Company can      terminate the Agreement at any time, at which point the Company is      released of all obligations. All property payments must be made within 30      days of the due date and all exploration work must be performed within 30      days of the required date. Otherwise, the mineral property rights will      revert back to the vendors. In addition, there is no guarantee that any      exploration will yield mineral commodities. Accordingly, the Company      expenses Property payments when paid and exploration costs as incurred.

During the year ended December 31, 2006 the Company made payments on      the Property of $7,500 CAD, of which $2,500 was prepaid, bringing total      payments made during the period of May 9, 2005 (inception) to December 31,      2006 to $12,500 CAD. 

The Company has paid $3,180 CAD in lieu of exploration work since      inception.
**NOTE 6 - NOTES PAYABLE TO STOCKHOLDERS
A stockholder regularly advances funds to the Company in exchange for      demand notes at a zero interest rate. Since the notes have no stated      maturity date or terms, the Company records simple annual interest of 6%      on the outstanding principal. Interest expense is recorded as an addition      to paid-in capital. The Company incurred and recorded $751 in interest      expense during the year ended December 31, 2006, bringing the total to      $932 since inception, May 9, 2005. The notes are due on demand and      therefore reported as current liabilities. As of December 31, 2006 the      Company owed $17,105 to the stockholder.
**NOTE 7 - FOREIGN CURRENCY TRANSLATION
Assets and liabilities denominated in Canadian dollars are revalued to      the United States dollar equivalent as of December 31, 2006. The $476      effect of change in exchange rates from the transaction dates to the      reporting date is reported as a Cumulative Currency Translation      Adjustment.
** 

 

 

 **
11

 
**OKANA VENTURES, INC.

(AN EXPLORATION STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2006 AND 2005

NOTE 8 - GOING CONCERN
The accompanying financial statements have been      prepared in accordance with accounting principles generally accepted in      the United States of America, which contemplates continuation of the      Company as a going concern. The Company has an operating deficit since its      inception, is in the exploration stage and has no recurring revenues.      These items raise substantial doubt about the Company's ability to      continue as a going concern. 

In view of these matters, realization of the assets of      the Company is dependent upon the Company's ability to meet its financial      requirements through equity financing and the success of future      operations. These financial statements do not include adjustments relating      to the recoverability and classification of recorded asset amounts and      classification of liabilities that might be necessary should the Company      be unable to continue in existence.

 

12
** **
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ONACCOUNTING AND FINANCIAL DISCLOSURE

There have been no disagreements of any kind with the company's independentauditors.

ITEM 8A. CONTROLS AND PROCEDURES

On December 31, 2006, Okana carried out an evaluation of theeffectiveness of the Company's disclosure controls and procedures (as defined byRule 13-15(e) under the Securities Exchange Act of 1934) under the supervisionand with the participation of Okana's chief executive officer and chieffinancial officer. Based on and as of the date of such evaluation, theaforementioned officers have concluded that Okana's disclosure controls andprocedures were effective.

There were no significant changes in Okana's internal controls or in otherfactors that could significantly affect these controls during the period coveredby this report.

ITEM 8B. OTHER INFORMATION

During the fourth quarter of the fiscal year ended December 31, 2006, therewas no information required to be reported on Form 8K which was not previouslyreported.

PART III

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

The names, ages, and respective positions of the directors, officers, andsignificant employees of the Company are set forth below. 
**Name****Age****Position****Date of Election or Appointment**Ronnie Birch59President, Chief Executive Officer, Director
5/9/05Michael Upham51Secretary, Treasurer, Chief Financial Officer,    Chief Accounting Officer, Director
5/9/05Mervyn Weiss60Director
5/9/05
Ronnie Birch has been our president, chief executiveofficer and a member of our Board of Directors since our inception. Since 1991to present, Mr. Birch has provided consulting services through Janron ConsultingInc., and since 1993 to present, the services of a public relations coordinatorthrough Bircress Corporate Relations. Both of these companies are privately heldcorporations in which Mr. Birch has a 50% share holding. From 1985 to 1991, hewas a licensed stock, commodities and options broker. Prior to that, he heldvarious jobs as a financial officer in his 17 years of employment with the Bankof Nova Scotia, holding various positions up to branch manager. Mr. Birch isprepared to devote 10% of his time, or approximately four hours per week, to ouroperations.

Michael Upham has been our secretary, treasurer, chieffinancial officer and chief accounting officer since inception. Mr. Upham wasalso a director of Beeston Enterprises Ltd., a developing company in the healthservice industry, from September 1999 to May 2005. Mr. Upham has been in theretail sales and marketing sector for over 35 years. He was manager of JackFraser's, a Canadian men's clothing chain, having worked his way up to amanagement level during his term with the company from 1971 to 1977. In 1978,Mr. Upham joined the sales staff at Finns Clothiers, where he worked as seniorsales representative until 1985. In 1986, be became district sales manager forPlaytex Canada Ltd. Mr. Upham left Playtex Canada Ltd. in 1996 to becomedistrict sales manager for Imperial Tobacco Company Limited, a position he holdsto this date. Mr. Upham is prepared to devote 10% of his time, or approximatelyfour hours per week, to our operations.

Mervyn Weiss has been a member of our Board of Directorssince inception. Mr. Weiss has been a self-employed business man and investorsince 1995 to present, dealing in both the real estate market and the stockmarket. He has also been a director of Columbus Networks Corp. an e-recruitmentfirm specializing in the education industry, since 2000 to present. From 1975 to1995 he was a sales representative for Lipton Monarch Foods, for the interior ofthe Province of British Columbia. Prior to that, Mr. Weiss was a financialconsultant and licensed stock broker from 1964 to 1975. Mr. Weiss is prepared todevote 10% of his time, or approximately four hours per week, to our operations.

None of Okana's directors or executive officers have been involved, duringthe past five years, in any bankruptcy proceedings, conviction or criminalproceedings; has not been subject to any order, judgment, or decree, notsubsequently reversed or suspended or vacated, of any court of competentjurisdiction, permanently or temporarily enjoining, barring, suspending orotherwise limiting his or her involvement in any type of business, securities orbanking activities; and has not been found by a court of competent jurisdiction,the Securities and Exchange Commission or the Commodity Futures TradingCommission to have violated a federal or state securities or commodities law.

There are no family relationships between any of the Company's officers anddirectors. 

There have been no changes in the procedures by which security holders mayrecommend nominees to the Company's Board of Directors.

The Board of Directors does not currently have a standing audit committee.
**Significant Employees**
Okana has no significant employees other than the officers and directorsdescribed above, whose time and efforts are being provided to Okana withoutcompensation.
**Compliance with Section 16(a) of the Exchange Act.**
The Company is not aware of a director or officer who is delinquent in theirreporting under Section 16(a) of the Exchange Act.
**Code of Ethics**
Okana has not adopted a code of ethics at this time.

ITEM 10. EXECUTIVE COMPENSATION.

(a) No officer or director of Okana is receiving any remuneration in the formof salaries and/or allowances at this time. 

(b) There are no annuity, pension or retirement benefits proposed to be paidto officers, directors, or employees of the corporation in the event ofretirement at normal retirement date pursuant to any presently existing planprovided or contributed to by the corporation or any of its subsidiaries.

(c) No remuneration is proposed to be paid in the future directly orindirectly by the corporation to any officer or director under any plan thatpresently exists.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT ANDRELATED STOCKHOLDER MATTERS

As of December 31, 2006, Okana had no compensation plans in effect underwhich equity securities are authorized for issuance.

Following is a table showing security ownership of certain beneficial owners,as well as management of the Company. Unless otherwise noted, each shareholderis the direct owner of his or her shares.

 

 

**Title of Class**
**Name and Address of Beneficial Owner**
**Amount and Nature of Beneficial Ownership**
**Percent of Class**
Common
Ronnie Birch

7071 Jasper Drive

Vernon B.C. Canada

V1H 1P2
300,000
35.29
Common
Michael Upham

87 Cranleigh Green S.E.

Calgary, Alberta, Canada

T3M 1J2
300,000
35.29
Common
Mervyn Weiss

5884 C Beach Avenue

Peachland, B.C., Canada

V0H 1X7
250,000
29.42
Common
Officers and Directors as a Group (3)
850,000
100%
There are currently no authorization plans in effect.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTORINDEPENDENCE.

Other than as set forth in Item 7, there are no relationships, transactions,or proposed transactions to which the registrant was or is to be a party, inwhich any of the named persons set forth in Item 404 of Regulation SB had or isto have a direct or indirect material interest.

None of the directors qualify as independent directors.

ITEM 13. EXHIBITS

**Exhibit No.**
**Document**
**Location**
3.1
Articles of Incorporation
Previously Filed
3.2
Bylaws
Previously Filed
3.3
Amendment to Bylaws
Previously Filed
31
Rule 13a-14(a)/15d-14(a) Certifications
Included
32
Section 1350 Certifications
Included
ITEM14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

1. Audit Fees: Aggregate fees billed for each of the last two (2) fiscalyears for professional services rendered by the principal accountant for theaudit of the annual financial statements and review of financial statementsincluded on Form 10-QSB: 

2005: $0

2006: $5,000

2. Audit-Related Fees: Aggregate fees billed in each of the last two (2)fiscal years for assurance and related services by the principal accountant thatare reasonably related to the performance of the audit or review of thefinancial statements and are not reported previously.

2005: $0

2006: $1,500

3. Tax Fees: Aggregate fees billed in each of the last two (2) fiscal yearsfor professional services rendered by the principal accountant for taxcompliance, tax advice, and tax planning.

2005: $0

2006: $0

4. All Other Fees: Aggregate fees billed in each of the last two (2) fiscalyears for products and services provided by the principal accountant, other thanthe services previously reported.

2005: $0

2006: $0

5. Audit Committee Pre-Approval Procedures. The Board of Directors has not,to date, appointed an audit committee.

 

SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrantcaused this report to be signed on its behalf by the undersigned, thereunto dulyauthorized.

 

                                                                                                                        OKANA VENTRES, INC.

Date:   March29, 2007                                                                                  ***/s/ Ronnie Birch                   ***

                                                                                                                       Ronnie Birch, President, CEO

 

In accordance with the Exchange Act, this report has been signed below by thefollowing persons on behalf of the registrant and in the capacities and on thedates indicated.

***/s/ Ronnie Birch***
 
***/s/ Michael Uphem***
Ronnie Birch
 
Michael Upham
President, CEO, Director
 
Secretary, Treasurer, CFO, Director
Date:   March 29, 2007
 
Date:  March 29, 2007
 
 
 
 
 
 ******************************************

**