SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



FORM 10-QSB



Quarterly Report Under Section 13 or 15(d)

Of the Securities Exchange Act of 1934



For Quarter Ended September 30, 2004



Commission File Number  33-16531-D



INTERNATIONAL AUTOMATED SYSTEMS, INC.

(Exact name of registrant as specified in its charter)



UTAH    87-0447580

(State or other jurisdiction of (IRS Employer Identification No.)

incorporation or organization)

326 North Sr. 198 ,

Salem, Utah   84653

(Address of principal executive offices)



Registrant's telephone number including area code    (801) 423-8132



Not Applicable

Former Address, if changed since last report





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





As of September 30, 2004 Registrant had 24,966,140 shares of common stock, no par value per share, which includes 3,698,450 shares held in escrow accounts.



Transitional Small Business Disclosure Format (Check One) Yes X  No ___



PART   I



Item 1

Financial Statements





INTERNATIONAL AUTOMATED SYSTEMS, INC.

(A Development Stage Company)

CONDENSED BALANCE SHEETS

(Unaudited)



|                                                                         | September      |  | June          
|------------------------------------------------------------------------ | -------------- |  | --------------
|                                                                         | 2004           |  | 2004          
|ASSETS                                                                   |                | 
|Current Assets                                                           |                |  |               
|Cash                                                                     | $      487,531 |  | $      702,366
|Prepaid sales commissions                                                | 4,000          |  | 4,000         
|Equipment held for distribution                                          | 16,945         |  | 16,945        
|Total Current Assets                                                     | 508,476        |  | 723,311       
|Property and Equipment                                                   |                |  |               
|Computers                                                                | 22,936         |  | 22,936        
|Equipment                                                                | 20,306         |  | 20,306        
|Automobiles                                                              | 62,633         |  | 62,633        
|Mobile office                                                            | 11,764         |  | 11,764        
|Deposits on equipment                                                    | 35,138         |  | 35,138        
|Total Property and Equipment                                             | 152,777        |  | 152,777       
|Accumulated depreciation                                                 | (74,574)       |  | (70,845)      
|Net Property and Equipment                                               | 78,203         |  | 81,932        
|Patents, net of $5,329 and $4,494 accumulated amortization, respectively | 122,962        |  | 120,291       
|Total Assets                                                             | $      709,641 |  | $      925,534
|                                                                         |                |  |               
|LIABILITIES AND STOCKHOLDERS' EQUITY                                     |                | 
|Current Liabilities                                                      |                |  |               
|Accounts payable                                                         | $       81,734 |  | $       92,460
|Accrued  payroll taxes                                                   | 157,676        |  | 156,772       
|Deposits from customers                                                  | 170,000        |  | 170,000       
|Deposits from related parties                                            | 74,400         |  | 74,400        
|Notes payable-current portion                                            | 6,096          |  | 5,588         
|Total Current Liabilities                                                | 489,906        |  | 499,220       
|Net Long-Term Liabilities -notes payable                                 | 363            |  | 2,479         
|Total Liabilities                                                        | 490,269        |  | 501,699       
|Stockholders' Equity                                                     |                |  |               
|Preferred stock, Class A, no par value, 4,400,000 shares                 |                |  |               
|authorized, 3,400,000 shares issued and outstanding                      | 294,786        |  | 294,786       
|Preferred stock, Class B, no par value, 600,000 shares                   |                |  |               
|authorized, 300,000 shares issued and outstanding                        | -              |  | -             
|Common stock, no par value, 45,000,000 shares                            |                |  |               
|authorized, 21,267,690 and 21,032,640 issued and                         |                |  |               
|outstanding, net 3,698,450 and 3,801,500 shares held in                  |                |  |               
|escrow account, respectively                                             | 9,671,800      |  | 9,601,090     
|Deficit accumulated during the development stage                         | (9,747,214)    |  | (9,472,041)   
|Total Stockholders' Equity                                               | 219,372        |  | 423,835       
|Total Liabilities and Stockholders' Equity                               | $      709,641 |  | $      925,534
|                                                                         |                |  |               

See the accompanying notes to the condensed financial statements.

INTERNATIONAL AUTOMATED SYSTEMS, INC.

(A Development Stage Company)

CONDENSED STATEMENTS OF OPERATIONS

(Unaudited)



|                                                                 |   |                            |   |                    |  | For the Period    
|---------------------------------------------------------------- | - | -------------------------- | - | ------------------ |  | ------------------
|                                                                 |   |                            |   |                    |  | From Inception    
|                                                                 |   | For the Three Months Ended |   | (September 26,    
|                                                                 |   | September 30,              |   | 1986) Through     
|                                                                 |   | 2004                       |   | 2003               |  | September 30, 2004
|Revenue                                                          |   |                            |   |                    |  |                   
|Sales                                                            |   | $                -         |   | $                - |  |                   
|Income from related party                                        |   | -                          |   | -                  |  |                   
|Total Revenue                                                    |   | -                          |   | -                  |  |                   
|                                                                 |   |                            |   |                    |  |                   
|Cost of Sales                                                    |   |                            |   |                    |  |                   
|Cost of sales                                                    |   | -                          |   | -                  |  |                   
|Write down of carrying value of inventories                      |   | -                          |   | -                  |  |                   
|Total Cost of Sales                                              |   | -                          |   | -                  |  |                   
|                                                                 |   |                            |   |                    |  |                   
|Gross Loss                                                       |   | -                          |   | -                  |  |                   
|                                                                 |   |                            |   |                    |  |                   
|Operating Expenses                                               |   |                            |   |                    |  |                   
|General and administrative                                       |   | 171,637                    |   | 112,185            |  |                   
|Research and development expense                                 |   | 103,536                    |   | 61,123             |  |                   
|Impairment of patents                                            |   | -                          |   | -                  |  |                   
|Litigation settlement expense                                    |   | -                          |   | -                  |  |                   
|Total Operating Expenses                                         |   | 275,173                    |   | 173,308            |  |                   
|                                                                 |   |                            |   |                    |  |                   
|Operating Loss                                                   |   | (275,173)                  |   | (173,308)          |  |                   
|                                                                 |   |                            |   |                    |  |                   
|Other Income and (Expenses)                                      |   |                            |   |                    |  |                   
|Loss on disposal of property and equipment                       |   | -                          |   | -                  |  |                   
|Forfeiture of deposits                                           |   | -                          |   | -                  |  |                   
|Interest income                                                  |   | -                          |   | -                  |  |                   
|Interest expense                                                 |   | -                          |   | (1,250)            |  |                   
|Net Other Expense                                                |   | -                          |   | (1,250)            |  |                   
|                                                                 |   |                            |   |                    |  |                   
|Loss Before Extraordinary Gain                                   |   | (275,173)                  |   | (174,558)          |  |                   
|                                                                 |   |                            |   |                    |  |                   
|Extraordinary gain on sale of patents, net of $0 in income taxes | - |                            | - |                    |  | 1,382,023         
|                                                                 |   |                            |   |                    |  |                   
|Net Loss                                                         |   | $    (275,173)             |   | $    (174,558)     |  |                   
|                                                                 |   |                            |   |                    |  |                   
|Basic and Diluted Loss Per Share                                 |   | $         (0.01)           |   | $         (0.01)   |  |                   
|Weighted Shares Used in Per Share Calculation                    |   | 24,558,136                 |   | 24,178,297         |  |                   
|                                                                 |   |                            |   |                    |  |                   

See the accompanying notes to the condensed financial statements.

INTERNATIONAL AUTOMATED SYSTEMS, INC.

(A Development Stage Company)

CONDENSED STATEMENTS OF CASHFLOW

(Unaudited)



|                                                              |         |                            |          |                 |           | For the Period          
|------------------------------------------------------------- | ------- | -------------------------- | -------- | --------------- | --------- | ------------------------
|                                                              |         |                            |          |                 |           | From Inception          
|                                                              |         | For the Three Months Ended |          | (September 26, 
|                                                              |         | September 30,              |          | 1986) Through  
|                                                              |         | 2004                       |          | 2003            |           | September 30, 2004      
|Cash Flows From Operating Activities                          |         |                            |          |                 |           |                         
|Net loss                                                      |         | $     (275,173)            |          | $     (174,558) |           | $            (9,747,214)
|Adjustments to reconcile net income (loss) to net             |         |                            |          |                 |           |                         
|cash from operating activities:                               |         |                            |          |                 |           |                         
|Depreciation and amortization                                 |         | 4,564                      |          | 2,901           |           | 320,017                 
|Stock based compensation                                      |         | -                          |          | -               |           | 2,221,407               
|Forfeiture of deposits                                        |         | -                          |          | -               |           | 236,803                 
|Loss on disposal of fixed assets                              |         | -                          |          | -               |           | 17,359                  
|rights to technology                                          |         | -                          |          | -               |           | 356,632                 
|Gain on sale of patents                                       |         | -                          |          | -               |           | (1,382,023)             
|Changes in current assets and liabilities:                    |         |                            |          |                 |           |                         
|Prepaid sales commissions                                     |         | -                          |          | -               |           | (4,000)                 
|Other current assets                                          |         | -                          |          | (3,000)         |           | -                       
|Deposits from customers                                       |         | -                          |          | 30,000          |           | 40,000                  
|Accounts payable                                              |         | (10,725)                   |          | 16,624          |           | 81,734                  
|Accrued liabilities                                           |         | 903                        |          | (30,394)        |           | 287,675                 
|Net Cash From Operating Activities                            |         | (280,431)                  |          | (158,427)       |           | (7,571,610)             
|Cash Flows From Investing Activities                          |         |                            |          |                 |           |                         
|Purchases of property and equipment                           |         | -                          |          | -               |           | (310,076)               
|Purchase of rights to technology                              |         | (3,506)                    |          | -               |           | (570,378)               
|Organization costs                                            |         | -                          |          | -               |           | (1,880)                 
|Net cash advanced to related party                            |         | -                          |          | -               |           | (1,644,988)             
|Proceeds from capital lease receivable                        |         | -                          |          | -               |           | 44,220                  
|Repayment of cash loaned to related party                     |         | -                          |          | -               |           | 53,254                  
|Net proceeds from sale of patents                             |         | -                          |          | -               |           | 1,382,023               
|Net Cash From Investing Activities                            |         | (3,506)                    |          | -               |           | (1,047,825)             
|Cash Flows From Financing Activities                          |         |                            |          |                 |           |                         
|Proceeds from issuance of common stock                        |         | 70,710                     |          | 200,080         |           | 2,769,909               
|Cash from controlling shareholder                             |         | -                          |          | -               |           | 6,270,559               
|Payments for treasury stock                                   |         | -                          |          | -               |           | (3,325)                 
|Payments for stock offering costs                             |         | -                          |          | -               |           | (56,509)                
|Decrease (increase) in bank overdraft                         |         | -                          |          | (28,441)        |           | -                       
|Proceeds from net borrowings from related party               |         | -                          |          | -               |           | 78,101                  
|Proceeds from notes payable                                   |         | -                          |          | -               |           | 29,857                  
|Payments on notes payable and obligations under capital lease | (1,608) |                            | (12,261) |                 | (137,285)
|Proceeds from related party deposits                          |         | -                          |          | -               |           | 224,400                 
|Purchases of equipment held for distribution                  |         | -                          |          | (3,003)         |           | (68,741)                
|Net Cash From Financing Activities                            |         | 69,102                     |          | 156,375         |           | 9,106,966               
|Net Increase In Cash                                          |         | (214,835)                  |          | (2,052)         |           | 487,531                 
|Cash at Beginning of Period                                   |         | 702,366                    |          | 54,034          |           | -                       
|Cash at End of Period                                         |         | $       487,531            |          | $        51,982 |           | $                487,531
|                                                              |         |                            |          |                 |           |                         

See the accompanying notes to the condensed financial statements.

INTERNATIONAL AUTOMATED SYSTEMS, INC.

(A Development Stage Company)

CONDENSED STATEMENTS OF CASHFLOW (CONTINUED)

(Unaudited)





|                                                     |  | For the Three Months Ended
|---------------------------------------------------- |  | --------------------------
|                                                     |  | September 30,             
|                                                     |  | 2004                      
|Supplemental Cash Flow Information                   |  |                           
|Cash paid for interest                               |  | $                 -       
|Non-Cash Investing and Financing Activities          |  |                           
|Convert equipment held for distribution and deposits |  |                           
|from related parties to contributed capital          |  | $                 -       
|                                                     |  |                           



See the accompanying notes to the condensed financial statements.



INTERNATIONAL AUTOMATED SYSTEMS, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS





NOTE 1INTERIM FINANCIAL STATEMENTS



The accompanying financial statements have been prepared by the Company, and are unaudited. In the opinion of management, the accompanying unaudited financial statements contain all necessary adjustments for fair presentation, consisting of normal recurring adjustments except as disclosed herein.



The accompanying unaudited interim financial statements have been condensed pursuant to the rules and regulations of the Securities and Exchange Commission; therefore, certain information and disclosures generally included in financial statements have been condensed or omitted. These financial statements should be read in connection with the Companys annual financial statements included in the Companys annual report on Form 10-KSB as of June 30, 2004. The financial position and results of operations of the interim periods presented are not necessarily indicative of the results to be expected for the year ended June 30, 2005.



Basic loss per common share is computed by dividing net loss available to common stockholders by the weighted-average number of common shares outstanding during the period.  Diluted loss per share reflects the potential dilution which could occur if all contracts to issue common stock were exercised or converted into common stock.  Common stock equivalents and stock options have not been included as they are anti-dilutive.



NOTE 2BUSINESS CONDITION



The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.  The Company has had no revenue and no operating income for the three-month period ended September 30, 2004, and a net loss of $275,173 was incurred for the three-month period ended September 30, 2004.  As of September 30, 2004, the Companys losses accumulated from inception totaled $9,747,214. These factors, among others, indicate that the Company may be unable to continue as a going concern for a reasonable period of time. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amount and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Companys ability to continue as a going concern is dependent upon its ability to generate sufficient cash flow to meet its obligations on a timely basis, to obtain additional financing as may be required, and ultimately to attain successful operations. Management is in the process of negotiating various sales agreements and is hopeful these sales will generate sufficient cash flow for the Company to continue as a going concern.



NOTE 3STOCK BASED COMPENSATION



The Company accounts for stock options issued to directors, officers and employees under Accounting Principles Board Opinion No. 25 and related interpretations (APB 25).  Under APB 25, compensation expense is recognized if an options exercise price on the measurement date is below the fair value of the Companys common stock.  The Company accounts for options and warrants issued to non-employees at their fair value in accordance with SFAS No. 123, Accounting for Stock-Based Compensation (SFAS 123).



No compensation cost has been recognized for its stock options in the accompanying financial statements.  Had the Company determined compensation cost based on the fair value at the grant date for its stock options under SFAS No. 123, the Companys net loss applicable to common shareholders would have been increased to the pro forma amounts indicated below for the three months ended September 30, 2004 and 2003:



|For the Three Months Ended September 30,         | 2004             |  | 2003            
|------------------------------------------------ | ---------------- |  | ----------------
|Net loss                                         | $    (275,173)   |  | $    (174,558)  
|Deduct:  Total stock-based employee compensation |                  |  |                 
|expense determined under fair value based method |                  |  |                 
|for all awards                                   | (2,787,812)      |  | (65,928)        
|Pro forma net loss                               | $  (3,062,985)   |  | $    (240,486)  
|                                                 |                  |  |                 
|Basic and diluted loss per share, as reported    | $         (0.01) |  | $         (0.01)
|Basic and diluted loss per share, pro forma      | $         (0.12) |  | $         (0.01)



NOTE 4CONTINGENCIES AND COMMITMENTS



Legal Contingencies  On September 23, 1998, the Company was notified by the U.S. Securities and Exchange Commission (SEC) of formal action against the Company, its president, and members of his family for possible securities violations. The action stems from alleged material misrepresentations by the Company and the Companys employees regarding new technology developed by the Company. The SEC is seeking disgorgement of the proceeds from the sale of stock by the Companys principals that occurred between June 1995 and June 1996. During the period ended September 30, 2004, the Company paid $100,000 under a tentative settlement agreement with the SEC.  The settlement is pending final approval from the SEC.



Payroll Tax Contingency The Company has unpaid federal and state withholding tax liabilities from prior periods which are substantially past due.  The Company was also assessed penalties by the IRS related to the filing of their 1999 W-2s.  Subsequent to the end of the period these penalties were abated, and have been reflected in the current period balances.  As of September 30, 2004, the remaining balance assessed by federal and state agencies, including penalties and interest, totaling $124,898 has been reflected in the financial statements as part of accrued payroll and related expenses.



NOTE 5STOCKHOLDERS EQUITY



Common Stock Issued For Cash  At June 30, 2004 the Company had a total of 3,801,500 shares held in escrow with three different entities. Proceeds of the stock sales from these escrow accounts are placed in separate escrow accounts to be used at the Companys and the trustees discretion. During the three months ended September 30, 2004, the Company issued 103,050 shares of common stock to individuals in exchange for $38,165 in cash at prices between $0.30 and $0.57 per share.  The proceeds were used to pay professional fees, operating expenses and accrued liabilities. At September 30, 2004, there was a balance of 3,698,450 shares left in escrow and a cash balance of $437,301.



During the three months ended September 30, 2004, the Company issued 132,000 shares of restricted common stock to individuals for $32,545 in cash.



NOTE 6  SUBSEQUENT EVENTS



Subsequent to September 30, 2004 the Company issued from its escrow account 90,300 shares of restricted common stock in exchange for $30,002 in cash or $0.35 per share.





ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION



FORWARD LOOKING STATEMENTS



This report contains forward looking statements regarding the Company's plans, objectives, expectations and intentions.  All forward looking statements are subject to risks and uncertainties that could cause the Company's actual results and experience to differ materially from such projections.  Such risks include  delays  in  product  development,  the  development  of  marketing and distribution channels, and market acceptance of its products.  Other  risks may be beyond the control of the Company.



LIQUIDITY AND CAPITAL RESOURCES



As  of  September 30, 2004, total current assets were $508,476 and total assets were $709,641 compared  to  total  current  assets  $723,311  and  total assets $925,534 as of June 30, 2004.



As  of  September 30, 2004, Registrant had total liabilities of $490,269  and shareholders' equity of  $219,372 as compared to total liabilities of $501,699 and  shareholders' equity of  $423,835  as  of  June  30,  2004. The  deficit accumulated during  the  development stage was $9,747,214 as of September 30, 2004, compared to $9,472,041 as of June 30, 2004.  At this time the Company is not generating sufficient funds  to  sustain  its  operations.  The Company's operations involve significant  risks regarding the development of technology and products that may not be commercially  acceptable  and  profitable.   As of September 30, 2004,  the  ratio  of current assets to current liabilities was approximately 1.04 to one.



The Registrant's contractual obligations include a note payable to a financing company that is due in September 2005.  The following is a schedule by year of the payments on these contractual obligations.





Payments Due By Period



Less Than    One To Three

Contractual Obligations                      Total        One Year         Years

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

Long-term debt                                $  6,459      $   6,096        $   363





Management is in the process  of  negotiating  various  sales agreements and is hopeful  these  sales  will generate sufficient cash flow for  the  Company  to continue operations. The Company's  ability  to  continue is dependent upon its ability to generate sufficient cash flow to meet its  obligations,  to  obtain  additional financing as may be required, and ultimately to attain successful operations.













RESULTS OF OPERATIONS



Three  Months Ended September 30, 2004 compared to Three Months Ended September 30, 2003



For the quarter ended September 30, 2004 and 2003, Registrant had no revenues or cost of sales. For the quarter ended September 30, 2004, registrant had total operating expenses of $275,173 compared to expenses of $173,308 during the same quarter of a year earlier. For the quarter, Registrant had a net loss of $275,173 compared to a net loss of $174,558 for the same quarter a year earlier. For the quarter, the net loss per share was $0.01 compared to a net loss of $0.01  for  the same quarter a year earlier.  For the quarter ended September 30, 2004, general and administrative  expenses  were $171,637 compared to $112,185 and research development expenses were $103,536  compared to $61,123  a  year  earlier.  The increase in net loss is primarily due to an increase in general and administrative expenses and an increase in research and development expenses.



FUTURE BUSINESS



The Company's ability to continue its activities  is  dependent on it receiving funds  either  as loans, advances, or sale of equity. Previously, the  major shareholder has provided  funds,  but there is no formal agreement between the Company and the majority shareholder to continue providing funds in the future. If the Company had to seek funds from another  source,  there  is no assurance that funds would be available at all or on terms acceptable to the Company.



ITEM 3: CONTROLS AND PROCEDURES



(a) Evaluation of disclosure controls and procedures- Based on their  evaluation of  the Company's disclosure controls and procedures (as defined in Rule  13a-15(e) under  the Securities Exchange  Act  of 1934 (the "Exchange Act")), the Company's  principal  executive officer and principal financial officer have concluded that as of the end of the period covered by this Quarterly Report of Form  10-Qsb such disclosure controls and procedures are  effective to ensure that information  required  to  be  disclosed by the Company in reports that it files or submits under the Exchange Act  is recorded, processed, summarized and reported  within  the time  periods  specified   in  Securities  and  Exchange Commission rules and forms.



(b)  Changes  in internal control over financial reporting- During  the  quarter under report, there  was  no  change  in  the  Company's  internal control over financial  reporting that has materially affected, or is reasonably  likely  to materially affect, the Company's internal control over financial reporting.





PART II - OTHER INFORMATION





ITEM 1.  LEGAL PROCEEDINGS



On September  23,  1998,  the  Company  was notified by the U.S. Securities and Exchange Commission (SEC) of formal action  against the Company, its president, and members of his family for possible securities  violations. The action stems from  alleged  material

misrepresentations by the Company  and  the  Company's employees regarding new technology developed by the Company. The SEC is seeking disgorgement of the proceeds from the sale of stock by the Company's principals that occurred between June 1995 and June 1996.



At the end of July 2001, the  president  of  the  Company,  on  behalf  of  the Company,  approved a settlement recommendation to be presented to the SEC as a full compromise of the  matter. During  December  2002,  the  Company received notification  from  the  SEC  that the proposed settlement agreement  had  been rejected.  Another tentative settlement agreement has been reached during the quarter ending March 31, 2004 in which the company paid $100,000. The settlement is awaiting final approval from the SEC. Company is currently unaware of when and how the SEC intends to pursue this action and any possible liability resulting from this action is undeterminable.



ITEM 2.  CHANGES IN SECURITIES



During the year ended June 30, 2004, the Company had, for purposes of selling, 3,801,500 shares of common stock in escrow with three entities. Proceeds of the stock sales from the escrow accounts are placed in separate escrow accounts to be used at the Company's and the attorney's discretion. At September 30, 2004, there was a balance of 3,698,450 shares left in escrow.  During the three months ended September 30, 2004, 103,050 shares were sold for proceeds of $38,165 at prices ranging from $0.30 to $0.57 per share.



During the three months ended September 30, 2004, the Company issued 132,000 shares of common stock to individuals in exchange for $32,545 in cash at prices between $0.30 and $0.57 per share.





ITEM 3.  DEFAULTS UPON SENIOR SECURITIES.



None.





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



None.





ITEM 5.  OTHER INFORMATION.



The Company entered into an Agreement with the Companys President, Neldon Johnson, effective as of May 14, 2004, for the acquisition of patents, patents pending, designs, and contracts related to certain technologies conceived and developed by Mr. Johnson. In exchange Mr. Johnson will receive from the Company 10,000,000 shares of Series A Preferred Stock, Warrants to purchase 100,000,000 shares of common stock at forty cents ($0.40) per share, and 10% of total gross sales in royalties of the Company. The transaction is a related party transaction.  No independent appraisal regarding the value of the exchange is available.



Each share of Series A Preferred Stock has equal dividend rights to the common shares, are not convertible into common shares, have no dividend requirements, and have no liquidation preferences to the common shares. Each preferred share is entitled to the voting rights of ten common shares.



The Company has agreed to increase the number of preferred and common stock they are allowed to issue in order to comply with the Agreement.





ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K



a. Exhibits



31

Certification by the Chief Executive and Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002





32

Certification by the Chief Executive and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002





SIGNATURES



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





Date: November 22, 2004



International Automated Systems, Inc.



By: /s/ Neldon Johnson

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

Neldon Johnson

President and Chief Executive Officer