UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549  FORM 10-Q  SQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period endedSeptember 30, 2020  OR  £TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 From ________________ to ________________   ELECTRONIC SYSTEMS TECHNOLOGY, INC. (Exact name of registrant as specified in its charter)  Washington000-2779391-1238077(State or other jurisdiction of incorporation)(Commission File  Number)(IRS Employer Identification No.)  415 N. Quay St. Bldg B1 Kennewick WA99336(Address of principal executive offices)(Zip Code)  (509) 735-9092 (Registrant's telephone number, including area code)  N/A (Former name, former address & former fiscal year, if changed since last report)  Securities registered pursuant to Section 12(g) of the Act:  Title of Each ClassTrading Symbol(s)Name of Each Exchange on Which RegisteredCommon Stock, $0.001 par valueELSTOTCQB  Indicate by check mark whether the registrant (1) has filed all documents and reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filings for the past 90 days.  YESxNO ̈  Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). YESx NO  ̈  Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act:  Large Accelerated Filer   £Accelerated Filer  £Non-Accelerated Filer    £Small Reporting Company    S
Emerging Growth Company  £  If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  £  Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  ̈ Nox  APPLICABLE ONLY TO CORPORATE ISSUERS: As of October 12, 2020, the number of the Company's shares of Common Stock par value $0.001, outstanding was 4,946,502.  1


PART I FINANCIAL INFORMATION  Item 1.  Financial Statements  ELECTRONIC SYSTEMS TECHNOLOGY, INC.
BALANCE SHEETS
(Unaudited)September 30,December 31,20202019ASSETSCurrent assetsCash and cash equivalents$       143,340$        274,936Certificates of deposit599,999650,000Accounts receivable, net116,38476,959Inventories781,816822,819Prepaid expenses26,06020,910Accrued interest receivable7,0176,540Total current assets1,674,6161,852,164Property and equipment, net of depreciation7,18312,398Right to use – Lease, net of amortization (NOTE 6)74,00539,641Total assets$    1,755,804$   1,904,203LIABILITIES and STOCKHOLDERS' EQUITYCurrent liabilitiesAccounts payable$         21,836$         101,548Refundable deposits1,0602,070Accrued wages and bonus2,470-Accrued vacation pay17,71311,165Lease liability, current (NOTE 6)35,63239,641Other accrued liabilities5,4392,485Total current liabilities84,150156,909Long-term liabilitiesCARES Act loan payable(NOTE 8)171,712-Lease liability (NOTE 6)38,373-Total long-term liabilities210,085-Total liabilities294,235156,909Stockholders' equityCommon stock, $0.001 par value 50,000,000 shares
authorized 4,946,502 and 4,946,502 shares issued and outstanding respectively4,9474,947Additional paid-in capital931,441929,159Retained earnings525,181813,188Total stockholders' equity1,461,5691,747,294Total liabilities and stockholders' equity$    1,755,804$    1,904,203  See Notes to Financial Statements.  2    ELECTRONIC SYSTEMS TECHNOLOGY, INC.
STATEMENTS OF OPERATIONS
(Unaudited)Three Months Ended
September 30, 2020Three Months Ended September 30, 2019Nine Months Ended September 30, 2020Nine Months Ended
September 30, 2019SALES - NET$         202,869$         371,915$       722,333$        1,141,343COST OF SALES(105,410)(163,041)(387,035)(528,415)GROSS PROFIT97,459208,874335,298612,928Operating ExpensesGeneral and administrative55,76164,756221,431227,450Research and development49,73948,445154,850165,397Marketing and sales90,22989,414264,420286,621TOTAL OPERATING EXPENSE195,729202,615640,701679,468OPERATING INCOME (LOSS)(98,270)6,259(305,403)(66,540)OTHER INCOMEGrant income (NOTE 8)-9,000-Interest income2,4445,5108,39617,265TOTAL OTHER INCOME2,4445,51017,39617,265NET INCOME (LOSS) BEFORE
INCOME TAX(95,826)11,769(288,007)(49,275)Benefit (provision) for income tax----NET INCOME (LOSS)$       (95,826)$       11,769$    (288,007)$        (49,275)Basic and diluted earnings per share($0.02)$0.00($0.06)($0.01)Basic weighted average shares4,946,5024,946,5024,946,5024,949,754Diluted weighted average shares4,946,5024,951,2734,946,5024,949,754   See Notes to Financial Statements.  3    ELECTRONIC SYSTEMS TECHNOLOGY, INC.
STATEMENTS OF CASH FLOWS
(Unaudited)Nine Months EndedSeptember 30,September 30,20202019CASH FLOWS FROM OPERATING ACTIVITIES:Net loss$     (288,007)$     (49,275)Noncash items included in net loss:Depreciation5,2145,978Share based compensation2,282-Changes in operating assets and liabilities:Accounts receivable, net(39,425)(114,097)Inventories41,0033,348Accrued interest receivable(477)3,308Prepaid expenses(5,150)(529)Accounts payable(79,713)(58,752)Refundable deposits(1,010)(8,240)Other accrued liabilities11,9749,127NET CASH PROVIDED (USED) IN OPERATING ACTIVITIES(353,309)(209,132)CASH FLOWS FROM INVESTING ACTIVITIES:Certificates of deposit redeemed600,0011,800,000Certificates of deposit purchased(550,000)(1,700,000)NET CASH PROVIDED FROM INVESTING ACTIVITIES50,001100,000CASH FLOWS USED IN FINANCING ACTIVITIES:Repurchase of shares of common stock-(14,920)Proceeds from CARES Act loan payable171,712-NET CASH USED IN FINANCING ACTIVITIES171,712(14,920)NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS(131,596)(124,052)Cash and cash equivalents at beginning of period274,936323,667Cash and cash equivalents at end of period$        143,340$        199,615Non-cash investing and financing activities:Recognition of operating lease liability and right of use asset$          74,005  See Notes to Financial Statements.  4    ELECTRONIC SYSTEMS TECHNOLOGY, INC.
DBA ESTEEM WIRELESS MODEMS

STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
(Unaudited)Common StockAdditional
Paid-InRetainedSharesAmountCapitalEarningsTotalBalances, January 1, 20194,985,748$4,986$944,040$  1,004,145$$1,953,171Net income (loss)---(54,825)(54,825)Common stock repurchased(39,246)(39)(14,881)-(14,920)Balance at March 31, 20194,946,502$4,947$929,159$    949,320$1,883,426Net income (loss)---(6,219)(6,219)Balance at June 30, 20194,946,502$4,947$929,159$   943,101$1,877,207Net income (loss)11,76911,769Balance at September 30, 20194,946,502$4,947$929,159$   954,870$1,888,976Balances, January 1, 20204,946,502$4,947$929,159$    813,188$$1,747,294Net income (loss)---(110,306)(110,306)Stock based compensation--2,282-2,282Balance at March 31, 20204,946,502$4,947$931,441$    702,882$1,639,270Net income (loss)---(81,875)(81,875)Balance at June 30, 20204,946,502$4,947$931,441$   621,007$1,557,395Net income (loss)---(95,826)(95,826)Balance at September 30, 20204,946,502$4,947$931,441$   525,181$1,461,569    See Notes to Financial Statements.  5


ELECTRONIC SYSTEMS TECHNOLOGY, INC. NOTES TO FINANCIAL STATEMENTS (Unaudited)  NOTE 1 - BASIS OF PRESENTATION  The financial statements, including notes, of Electronic Systems Technology, Inc. (the "Company") are representations of the Company’s management, which is responsible for their integrity and objectivity. The accompanying unaudited financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information, as well as the instructions to Form 10-Q. Accordingly, the financial statements do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, the accompanying unaudited financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of its financial position as of September 30, 2020, and its results of operations, cash flows, and changes in stockholders’ equity for the three months and nine months ended September 30, 2020 and 2019.  The balance sheet at December 31, 2019 was derived from audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements. All amounts presented are in U.S. dollars. For further information, refer to the financial statements and footnotes thereto in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.  The results of operations for the three month and nine-month period ended September 30, 2020 are not necessarily indicative of the results expected for the full fiscal year or for any other fiscal period. The Company estimates that for 2020 the anticipated effective annual federal income tax rate will be 0%.  Accounting Standards Updates Adopted  In August 2018, the FASB issued ASU No. 2018-13 Fair Value Measurement (Topic 820):  Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement.  The update removes, modifies and makes additions to the disclosure requirements on fair value measurements.  The update is effective for fiscal years beginning after December 15, 2019, with early adoption permitted.  The adoption of this update on January 1, 2020 had no impact on the financial statements.  Other accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the financial statements upon adoption.  NOTE 2 - INVENTORIES  Inventories are stated at lower of direct cost or net realizable value with cost determined using the FIFO (first in, first out) method.  Inventories consist of the following:  September 30,
2020December 31,
2019Parts$       107,188$       116,843Work in progress360,468379,987Finished goods314,160325,989Total inventories$       781,816822,819  6   ELECTRONIC SYSTEMS TECHNOLOGY, INC. NOTES TO FINANCIAL STATEMENTS (Unaudited)  NOTE 3 - EARNINGS (LOSS) PER SHARE  Basic earnings (loss) per share excludes dilution and is computed by dividing income (loss) available to common stockholders by the weighted-average number of shares of Common Stock outstanding for the period.  Diluted earnings (loss) per share reflects potential dilution occurring if securities or other contracts to issue Common Stock were exercised or converted into Common Stock or resulted in the issuance of Common Stock that then shared in the earnings of the Company.For the nine month period ending September 30, 2020 and 2019 and the three month period ending September 30, 2020, all outstanding stock options (Note 4) were excluded from the computation of diluted loss per share because they were anti-dilutive due to net losses in those periods. For the three month period ending September 30, 2019, the calculation of the weighted average number of common shares outstanding–diluted included the common stock equivalents of the outstanding stock options.  NOTE 4 - STOCK OPTIONS  As of September 30, 2020, the Company had outstanding stock options which have been granted periodically to individual employees and directors.  On March 13, 2020, the Board of Directors canceled all 120,000 outstanding stock options that were granted on August 7, 2017 and were due to expire on August 6, 2020.    In addition, the Board of Directors granted 180,000 options to employees. The new options have an exercise price of $0.40, a term of 5 years, and vested immediately.    The fair value of the options was determined using the Black-Scholes model using the following variables:   stock price of $0.40, volatility of 79.27%, expected term of 5 years with a forfeiture rate of 95%, and a discount factor of 0.72%. Share based compensation of $2,282 was recognized during the nine-month period ended September 30, 2020.  A summary of option activity during the nine-month period ended September 30, 2020 is as follows:  Number OutstandingWeighted-Average Exercise Price Per ShareWeighted-Average Remaining Life
(Years)Approximate Aggregate Intrinsic ValueOutstanding and Exercisable at December 31, 2019120,000$0.400.6NilGranted180,000$0.405.0Canceled(120,000)$0.40-Outstanding and Exercisable at September 30, 2020180,000$0.404.5Nil  7   ELECTRONIC SYSTEMS TECHNOLOGY, INC. NOTES TO FINANCIAL STATEMENTS (Unaudited)   NOTE 5 – REVENUE  The Company derives revenues from the sales of industrial wireless products and accessories such as antennas, power supplies and cable assemblies. The Company also provides direct site support and engineering services to customers, such as repair and upgrade of its products.  The Company’s customers, to which trade credit terms are extended, consist of United States and local governments and foreign and domestic companies.  For the three-month period ending September 30,20202019Domestic SalesForeign SalesTotal SalesDomestic SalesForeign SalesTotal SalesProduct Sales$ 185,408$   9,711$ 195,119$ 346,118$   23,497$ 369,615Site Support Sales7,750-7,7502,300-2,300Total Sales$ 193,158$  9,711$ 202,869$ 348,418$   23,497$ 371,915  For the nine-month period ending September 30,20202019Domestic SalesForeign SalesTotal SalesDomestic SalesForeign SalesTotal SalesProduct Sales$ 617,547$   74,936$ 692,483$ 943,013$163,053$1,106,066Site Support Sales29,850-29,85035,277-35,277Total Sales$ 647,397$  74,936$ 722,333$ 978,290$163,053$1,141,343  For the three-month period ended September 30, 2020, sales to four customers represented more than 10% of total revenue.  Two customers represented more than 10% of total revenue for the same period in 2019.  2020 Sales2020 %age of Total Sales2019 Sales2019%age of Total SalesDomestic customer A$       26,87513%$      70,03520%Domestic customer B$       25,64013%$      44,34112%Domestic customer C$       24,86412%Domestic customer D$       22,09311%  For the nine-month period ended September 30, 2020, sales to one customer represented more than 10% of total revenue.  One customer represented more than 10% of total revenue for the same period in 2019.  2020 Sales2020 %age of Total Sales2019 Sales2019 %age of Total SalesDomestic customer A$82,56611%$152,45013%  As of September 30, 2020 and 2019, the Company had a sales order backlog of $3,400 and $6,691, respectively.  8   ELECTRONIC SYSTEMS TECHNOLOGY, INC. NOTES TO FINANCIAL STATEMENTS (Unaudited)   NOTE 6 - LEASES  The Company leases its facilities from a port authority for $5,639 per month for three years, expiring in September 2020, with annual increases based upon the Consumer Price Index. The original lease was effective October 1, 2014 and contained a three-year renewal option and a provision for an annual increase of 2% per year, plus Leasehold Tax of 12.84%.  On September 5, 2017, the Company exercised the three-year option. The first year of this option was not subject to the 2% increase. The lease did not contain the option to extend the lease beyond the September 2020 expiration.  For the three month and nine-month periods ended September 30, 2020 and 2019, lease expenses are included in the following expense classifications on the statement of operations:   For the three-month period ending September 30,20202019Cost of salesOperating expensesTotalCost of salesOperating expensesTotalBase rent pursuant to lease agreement$ 2,998$   11,995$ 14,993$ 2,947$   11,788$ 14,735Variable lease costs3851,5401,9253781,5141,892Total lease costs$ 3,383$   13,535$ 16,918$ 3,325$   13,302$ 16,627   For the nine-month period ending September 30,20202019Cost of salesOperating expensesTotalCost of salesOperating expensesTotalBase rent pursuant to lease agreement$ 8,996$   36,163$ 45,159$ 8,842$   35,362$ 44,204Variable lease costs1,1554,6205,7751,1344,5425,676Total lease costs$ 10,151$   40,783$ 50,934$ 9,976$   39,906$ 49,880  On September 23, 2020 the Company signed a new two-year lease for its facilities for $3,568 and $3,687 per month for the respective year. The base lease is $3,162 and $3,267 for years one and two. There is a leasehold tax applied to the base lease at 12.84%. The Company has the right to terminate the lease with 90 days’ notice. There is no renewal clause contained in the current lease.  Upon signing the lease, the Company recognized a lease liability and right of use asset of $74,005.  Total future lease payments under the new lease are as follows:  From October 1, 2020 to September 30, 2021$37,944From October 1, 2021 to September 30, 202239,209Less imputed interest(3,148)Net lease liability74,005Current portion(35,632)Long-term portion$38,373  9   ELECTRONIC SYSTEMS TECHNOLOGY, INC. NOTES TO FINANCIAL STATEMENTS (Unaudited)  NOTE 7 – STOCK REPURCHASE  On January 13, 2016, the Company’s Board of Directors approved a resolution authorizing the repurchase of up to $100,000 of the Company’s Common Stock at the price of $0.38 per share. The Company’s share repurchase program does not obligate it to acquire any specific number of shares. On March 2, 2016, the Company’s Board of Director approved a resolution authorizing the repurchase of an additional $150,000 of the Company’s Common Stock at the price of $0.38 per share. Under the program (the “Stock Repurchase Plan”), shares may be repurchased in open market transactions, complying with Rule 10b5-1 and Rule 10b-18 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Shares repurchased are retired. During the nine-month period ended September 30, 2020, no shares were repurchased; 39,246 shares for $14,920 were repurchased in the nine-month period ended September 30, 2019. Since inception of the Stock Repurchase Plan, the Company has repurchased 212,165 shares for a total of $80,622 through September 30, 2020 and $169,378 of the original $250,000 approved by the board remains.  On April 23, 2020, repurchases were suspended indefinitely.  NOTE 8 – CARES ACT LOANS PAYABLE  On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (the “CARES Act”) Act was signed into United States law.  In April 2020, the Company received a loan of $171,712 pursuant to the Paycheck Protection Program (the “PPP”) under Division A, Title I, Section 1102 and 1106 of the CARES Act.   The loan, which was in the form of a promissory note, as amended, dated April 13, 2020 issued by the Company (the “Note”); the Note matures on April 13, 2022 and bears interest at a rate of 1% per annum. The Note may be prepaid by the Company at any time prior to maturity with no prepayment penalties. Under the terms of the PPP, certain amounts of the loan may be forgiven if they are used for qualifying expenses as described in the CARES Act. Qualifying expenses include payroll costs, costs used to continue group health care benefits, mortgage payments, rent, and utilities. As of September 30, 2020, the Company has used funds from the loan to pay qualifying expenses.  The Company intends to apply for forgiveness of the loan when it receives instructions from the lender at which time grant income of $171,712 will be recognized.  During the nine months ended September 30, 2020, the Company received $9,000 under Division A, Title I, Section 1110 of the CARES Act.    The Company is not required to pay this amount back and thus recognized $9,000 as government grant income during the period.   10    Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION  Management's discussion and analysis is intended to be read in conjunction with the Company's unaudited financial statements and the integral notes thereto for the quarter ended September 30, 2020.  The following statements may be forward looking in nature and actual results may differ materially.  A.RESULTS OF OPERATIONS  As a result of COVID-19, and governmental responses thereto, are experiencing some negative impacts to our business, primarily as a result of reductions in staffing by our customers, and their customers, which is lengthening our normal sales cycles. Many of our customers are also restricting visits from vendors. All of our planned trade shows and sales presentations have been canceled or postponed as a result of the risks associated with face to face meetings. We have utilized various platforms to provide current customers and potential customers with presentations about our products and services. We have also experienced some delays in our supply chain but none of these COVID-19 related disruptions, to the supply chain, has been significant at this point.  REVENUES: Total revenues from sales decreased to $202,869 for the third quarter of 2020 as compared to $371,915 in the third quarter of 2019, reflecting a decrease of 45.5%.  Management believes the decrease in sales revenues is due to the impact of the COVID-19 stay at home orders when compared with the same quarter of 2019. Year to date total revenues from sales decreased to $722,333 in 2020 as compared to $1,141,343 in 2019, reflecting a decrease of 36.7%.  Management believes the decrease in sales revenues is due to the impact of the COVID-19 stay at home orders when compared with the same period of 2019.  The Company's revenues have historically fluctuated from quarter to quarter due to timing factors such as product shipments to customers, customer order placement, customer buying trends, and changes in the general economic environment.  The procurement process regarding plant and project automation, or project development, which usually surrounds the decision to purchase ESTeem products, can be lengthy.  This procurement process may involve bid activities unrelated to the ESTeem products, such as additional systems and subcontract work, as well as capital budget considerations on the part of the customer.  Because of the complexity of this procurement process, forecasts with regard to the Company's revenues are difficult to predict.  Although the COVID-19 situation represents a significant disruption to operations in 2020, we have taken steps intended to keep our staff safe. Staff, whose jobs allow, are telecommuting.  Those whose jobs require specialized equipment continue to work on site and are keeping safe distances to minimize the potential to contract or spread the virus. We are observing social distancing for those employees that remain on-site. Masks have been provided to all employees to minimize the risk of exposure. Daily monitoring of temperatures as well as adding sanitizers have also been instituted.  A percentage breakdown of the Company’s market segments of Domestic and Foreign Export sales for the three and nine month periods ended September 30, 2020 and 2019 are as follows:  Three Months ended September 30, 2020Three Months ended September 30, 2019Nine Months ended September 30, 2020Nine Months ended September 30, 2019Domestic Sales95%94%90%86%Export Sales5%6%10%14%  11    BACKLOG:  As of September 30, 2020, the Company had a sales order backlog of $3,400.   The Company’s customers generally place orders on an "as needed basis".  Shipment for most of the Company’s products is generally made within 1 to 5 working days after receipt of customer orders, with the exception of ongoing, scheduled projects, and custom designed equipment.  COST OF SALES:  Cost of sales percentages for the third quarter of 2020 and 2019 were 52% and 44% of respective net sales. The cost of sales percentage increase in the third quarter of 2020 is the result of the product mix sold during the same quarter of 2019. Cost of sales percentages for the nine month periods ended September 30, 2020 and 2019 were 54% and 46%. The cost of sales percentage increase in the third quarter of 2020 is the result of the product mix sold during the same period of 2019.  OPERATING EXPENSES:  The following is a delineation of operating expenses:  Three Months EndedNine Months EndedSept. 30,
2020Sept. 30,
2019Increase
(Decrease)Sept. 30,
2020Sept. 30,
2019Increase
(Decrease)General and administrative$    55,761$    64,756$   (8,995)$  221,431$  227,450$  (6,019)Research and development49,73948,4451,294154,850165,397(10,547)Marketing and sales90,22989,414815264,420286,621(22,201)Total operating expenses$  195,729$  202,615$   (6,886)$  640,701$  679 468$ (38,767)  General and administrative:For the third quarter of 2020, general and administrative expenses decreased $8,995 to $55,761, due to decreased wages when compared with the same quarter of 2019. For the nine-month period, general and administrative expenses decreased by $6,019 to $221,431, due to decreased wages and professional services.  Research and development:Research and development expenses increased $1,294 to $49,739 during the third quarter of 2020 due to increased wages when compared with the same quarter of 2019. For the nine-month period, research and development expenses decreased by $10,547 to $154,850, due to decreased prototype build costs.  Marketing and sales:During the third quarter of 2020, marketing and sales expenses increased $815 to $90,229 when compared with the same period of 2019, due to increased wages. For the nine-month period, marketing and sales expenses decreased by $22,201 to $264,420, due to decreased travel and trade shows.  OTHER INCOME:  The Company earned $2,444 in interest income during the quarter ended September 30, 2020 and $8,396 for the nine-month period.  Sources of this income were money market accounts and certificates of deposit. The Company received a government grant under the CARES Act in the amount of $9,000 for COVID relief.  12    NET LOSS:  The Company had a net loss of $95,826 for the third quarter of 2020 compared to a net income of $11,769 for the same quarter of 2019.  For the nine-month period ended September 30, 2020, the Company recorded a net loss of $288,007 compared with a net loss of $49,275 for the same period of 2019.  The increase in net loss during 2020 is the result of decreased sales revenues and gross income.  B.FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES  The Corporation's current asset to current liabilities ratio at September 30, 2020 was 19.9 compared to 11.8 at December 31, 2019.  The increase in current ratio is due to the reduction in accounts payable at September 30, 2020 as compared to December 31, 2019.  At September 30, 2020, the Company had cash and cash equivalents of $143,340 as compared to cash and cash equivalent of $274,936 at December 31, 2019, primarily reflecting cash provided in investing and financing activities.  Cash used in operating activities increased by $144,177 for the nine-month period ended September 30, 2020 when compared to the same period in 2019. The increase is attributable to an increase in net loss for the period being $238,732 greater than the same period in 2019.  Net cash provided from investing was $50,001 due to the redemption of certificates of deposits maturing during the nine months of 2020. Cash provided from financing activities was $171,712, which were the proceeds of the CARES Act loan received during the nine-month period ended September 30, 2020. We believe that the entire loan will be forgiven based on recent amendments to the CARES Act for forgiveness.  In management's opinion, the Company's cash and cash equivalents and other working capital at September 30, 2020 is sufficient to satisfy requirements for operations, capital expenditures, and other expenditures as may arise during 2020.  As a result of COVID-19, and governmental responses thereto, we are experiencing some negative impacts to our business, primarily as a result of reductions in staffing by our customers, and their customers, which is lengthening our normal sales cycles. Many of our customers are also restricting visits from vendors. All of our planned trade shows and sales presentations have been canceled or postponed as a result of the risks associated with face to face meetings. We have utilized various platforms to provide current customers and potential customers with presentations about our products and services. We have also experienced some delays in our supply chain but none of these COVID-19 related disruptions has been significant at this point.  FORWARD LOOKING STATEMENTS:  The above discussion may contain forward looking statements that involve a number of risks and uncertainties.  In addition to the factors discussed above, among other factors that could cause actual results to differ materially are the following: competitive factors such as rival wireless architectures and price pressures; availability of third party component products at reasonable prices; inventory risks due to shifts in market demand and/or price erosion of purchased components; change in product mix, and risk factors that are listed in the Company's reports and registration statements filed with the Securities and Exchange Commission.  13    OFF-BALANCE SHEET ARRANGEMENTS  The Company has no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to its stockholders.  Item 3.  Quantitative and Qualitative Disclosures About Market Risk.  There is no established market for trading the common stock of the Company. The market for the Company’s common stock is limited, and as such shareholders may have difficulty reselling their shares when desired or at attractive market prices.  The Common Stock is not regularly quoted in the automated quotation system of a registered securities system or association.  Our common stock, par value $0.001 per share, is quoted on the OTC Markets Group QB (OTCQB) under the symbol “ELST”.  The OTCQB is a network of security dealers who buy and sell stock. The dealers are connected by a computer network which provides information on current “bids” and “asks” as well as volume information. The OTCQB is not considered a “national exchange”.  The “over-the-counter” quotations do not reflect inter-dealer prices, retail mark-ups commissions or actual transactions.  The Company’s common stock has continued to trade in low volumes and at low prices. Some investors view low-priced stocks as unduly speculative and therefore not appropriate candidates for investment. Many institutional investors have internal policies prohibiting the purchase or maintenance of positions in low-priced stocks.  Item 4.Controls and Procedures  An evaluation has been performed under the supervision and with the participation of our management, including our Chief Executive Officer and Principal Accounting Officer, of the effectiveness of the design and the operation of our "disclosure controls and procedures" (as such term is defined in Rules 13a-15(e) under the Securities Exchange Act of 1934) as of September 30, 2020.  Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have determined that there was a material weakness affecting our internal control over financial reporting and, as a result of that weakness, our disclosure controls and procedures were not effective as of September 30, 2020.  The material weakness is as follows:  We did not maintain effective controls to ensure appropriate segregation of duties as the same officer and employee was responsible for the initiating and recording of transactions, thereby creating segregation of duties weaknesses. Due to the (1) significance of segregation of duties to the preparation of reliable financial statements; (2) the significance of potential misstatement that could have resulted due to the deficient controls; and, (3) the absence of sufficient other mitigating controls; we determined that this control deficiency resulted in more than a remote likelihood that a material misstatement or lack of disclosure within the annual or interim financial statements will not be prevented or detected.  Changes in Internal Control Over Financial Reporting  There have not been any changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.  14    PART II—OTHER INFORMATION  Item 1.  Legal Proceedings  None.  Item 2. Unregistered Sales of Securities  None.  Item 3. Defaults Upon Senior Securities  None.  Item 4. Mine Safety Disclosures  Not Applicable  Item 5.  Other Information  None.  15    Item 6.  Exhibits  EXHIBIT  NUMBERDESCRIPTION31.1Section 302 Certification, CEO31.2Section 302 Certification, CFO32.1Section 906 Certification, CEO32.2Section 906 Certification, CFO101.INSXBRL Instance Document101.SCHXBRL Taxonomy Extension Schema Document101.CALXBRL Taxonomy Extension Calculation Linkbase Document101.DEFXBRL Taxonomy Extension Definition Linkbase Document101.LABXBRL Taxonomy Extension Label Linkbase Document101.PREXBRL Taxonomy Extension Presentation Linkbase Document  16    SIGNATURES  In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.  ELECTRONIC SYSTEMS TECHNOLOGY, INC.   By:  /s/ Michael W. EllerDate:  October 29, 2020Name:  Michael W. EllerTitle:  President(Principal Executive Officer)    By:  /s/ Michael W. EllerDate:  October 29, 2020Name:  Michael W. EllerTitle:  President(Principal Accounting Officer)  17