U.S.
      Securities and Exchange Commission





Washington,
      D.C. 20549





**Amendment
        No. 2 to**


**FORM
      10-KSB/A**





(Mark
      One)


[
                X]
            ANNUAL
                REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
                1934





For
      the
      fiscal year ended April 30, 2006





[
                 ]
            TRANSITION
                REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
                1934





For
      the
      transition period from ___________________ to ______________





Commission
      file number: 333-90618





**INFOTEC
      BUSINESS SYSTEMS, INC.**


(Name
      of
      small business issuer in its charter)





**NEVADA**
            **98-0358149**(State
                or other jurisdiction of
            (I.R.S.
                Employer Identification No.)incorporation or organization)








**#150
                - 1152 Mainland Street, Vancouver, B.C.**
            **V6B
                4X2**(Address
                of principal executive offices)
            (Zip
                Code)





Issuer’s
      Telephone Number **(604)
      484-4966**





Securities
      registered under Section 12(b) of the Exchange Act: None





Securities
      registered under Section 12(g) of the Exchange Act: None





Check
      whether the issuer (1) filed all reports required to be filed by Section 13
      or
      15(d) of the Exchange Act during the past 12 months (or for such shorter period
      that the registrant was required to file such reports), and (2) has been subject
      to such filing requirements for the past 90 days.





YES
      [ X ]
   NO [   ]





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


(The
      registrant is not a Section 12(g) filing issuer)









1




Indicate
          by check mark whether the registrant is a shell company (as defined in
          Rule
          12b-2 of the Exchange Act). Yes( ) No(X)




State
      issuer's revenues for its most recent fiscal year:  $187,448.





State
      the
      aggregate market value of the voting stock held by non-affiliates computed
      by
      reference to the price at which the stock was sold, or the average bid and
      asked
      prices of such stock, as of a specified date within the past 60
      days.





The
      aggregate market value of the common stock held by non-affiliates of the
      registrant as of the close of business on June 30, 2006 (an aggregate 44,585,625 shares
      out of a total of 121,500,000 shares outstanding at that time) was approximately
      $10,935,000 computed by reference to the average closing bid and ask price
      on
      that date.




(APPLICABLE
      ONLY TO CORPORATE ISSUERS)





State
      the
      number of shares outstanding of each of the issuer’s classes of common equity,
      as of the latest practicable date:  121,500,000 shares of Common Stock as
      of June 30, 2006.





This
      report contains a total of 35 pages.





DOCUMENTS
      INCORPORATED BY REFERENCE





Not
      Applicable








Transitional
      Small Business Disclosure Format (check one): Yes  ;
       No X










**EXPLANATION
      OF AMENDMENT**




We
          are
          filing this Amendment No. 2 due to the Consolidated Statements of Stockholders’
Equity were incorrect due to a clerical error in the edgarization process.
          The
          corrections are as follows: Net (loss) for the period from (1,573,291)
          to
          (1,612,267), Adjustment for Foreign currency translation adjustment from
          12,969
          to 11,166 and the relating footings for Comprehensive Income, Deficit
          accumulated during the development stage, and Total stockholders’ equity. There
          are no other changes to the 10-KSB other than those stated
          above.






**PART
      I**





The
      terms
      "Infotec", "us", "we", "the company" and "our", refer to Infotec Business
      Systems, Inc. or our wholly owned subsidiaries Galaxy Networks Inc., Stream
      Horizon Studios Ltd. (formerly, Infotec Business Strategies Inc.), Galaxy US
      Networks Inc. (formerly, Eventec Inc.) and ebahn Television Networks Inc.,
      unless the context otherwise implies.





Forward
      Looking Statements





This
      annual report on Form 10-KSB contains forward-looking statements that involve
      substantial risks and uncertainties. You can identify these statements by
      forward-looking words such as "may", "will", "expect", "intend", "anticipate",
      "believe", "estimate", "continue" and other similar words.  You should read
      statements that contain these words carefully because they discuss our future
      expectations, mak-ing projections of our future results of operations or our
      financial condition or state other "forward-looking" information.
 Forward-looking statements involve known and unknown risks and
      uncertainties which may cause the actual results, performance or achievements
      of
      our company to be materially different from those which may be expressed or
      implied by such statements.  The factors listed in the subsection under the
      caption "Additional Risk Factors" which is included in the section of this
      report titled "Management's Discussion and Analysis or Plan of Operation",
      as
      well as any other cautionary language in this report, provide examples of risks,
      uncertainties and events which may cause our actual results to differ materially
      from the expectations we described in our forward-looking statements.  We
      do not undertake any obligation to publicly update forward-looking statements
      to
      reflect events or circumstances after the date on which the statement is made or
      to reflect the occur-rence of unanticipated events.





2





**ITEM
      1. DESCRIPTION OF THE BUSINESS** .





Organization


We
      were
      incorporated under the laws of the State of Nevada on August 30, 2001. Effective
      October 3, 2001, we entered into an agreement to acquire the prior development,
      designs and pilot implementation of a virtual office system from Danby
      Technologies Corporation in consideration for a purchase price of $60,000 and
      a
      royalty on our net revenues from the system or products or services which use
      the system.





In
      February 2003, we filed a Form of Certificate Change to amend our Certificate
      of
      Incorpora-tion, to increase our authorized and issued capital stock through
      a 1
      to 6 forward split to 450,000,000 shares of capital stock authorized for
      issuance, consisting of 300,000,000 shares of common stock and 150,000,000
      shares of preferred stock.





As
      of
      November 11, 2004, the Company made and entered into an agreement which provides
      for the reorganization of Galaxy Networks Inc., a British Columbia company,
      with
      and into Infotec Business Systems, Inc., a Nevada company, resulting in Galaxy
      Networks Inc. becoming a wholly-owned subsidiary of Infotec Business Systems,
      Inc. (Infotec). The agreement was for the exchange of 100% of the out-standing
      common stock of Galaxy Networks Inc., for 20,000,000 (50,000,000 post-split)
      shares of Infotec’s common stock.





The
      former shareholders of Galaxy Networks Inc. acquired control of the Company
      upon
      the closing of the share exchange transaction. The exchange was accounted for
      as
      a reverse acquisition. Accordingly, for financial statement purposes, Galaxy
      Networks Inc. was considered the accounting acquirer and the related business
      combination was considered a recapitalization of Galaxy Networks Inc. rather
      than an acquisition by the Company. The historical financial statements prior
      to
      the agreement are those of Galaxy Networks Inc. and the name of the consolidated
      Company going forward is Infotec Business Systems, Inc. These financial
      statements include the financial position of Infotec Business Systems, Inc.,
      Galaxy Networks Inc., Stream Horizon Studios Ltd. (formerly “Infotec Business
      Strategies, Inc.”) and Galaxy US Networks Inc. (formerly “Eventec Inc.”), at
      April 30, 2006, and their results of operations from December 13, 2002 to April
      30, 2006.





Concurrent
      with the reorganization the Company issued 500,000 (1,250,000 post-split) shares
      of Infotec Business Systems, Inc. common stock for services for value of
      $90,000.


On
      September 30, 2005, the Company entered into an acquisition agreement with
      the
      sole proprietor of Stream Horizon Media (Stream Horizon), a British Columbia
      sole pro-prietorship which provided for the acquisition by Infotec Business
      Strategies, Inc., a wholly-owned subsidiary of the Company, of 100% interest
      in
      the business and assets of Stream Horizon, in exchange for the issuance of
      5,000,000 (12,500,000 post-split) common shares of the Company. The aggregate
      purchase price and the value of the common shares issued in consideration was
      determined to be $750,000 based on the market price of the Company ’ s
      common
      shares on the September 12, 2005, the date of substantive agreement between
      the
      parties.





3





The
      acquisition included the assets, business operations and assumption of lease
      liability of Stream Horizon exclusive of working capital items and any
      indebtedness or other obligations. The acquisition has been accounted using
      the
      purchase method. The results of Stream Horizon have been included in the
      consolidated financial statements since October 1, 2005.





On
      September 30, 2005, the Company entered into a definitive acquisition agreement
      with the stockholder of ebahn Television Network Corp., a Nevada company, which
      formalized their agreement of September 12, 2005 to acquire a 100% interest
      in
      ebahn and the stockholders’ debt payable by ebahn, in exchange for the issuance
      of 1,100,000 (2,750,000 post-split) common shares of the Company.





On
      October 18, 2005 the Company effected a forward split of its capital stock
      on a
      2.5:1 basis so that the 450,000,000 shares authorized (300,000,000 common shares
      and 150,000,000 preferred shares) and 48,600,000 shares of common stock issued,
      were increased to 1,125,000,000 shares authorized (750,000,000 common shares
      and
      375,000,000 preferred shares) and 121,500,000 shares of common stock issued.
      Par
      value of the preferred and common stock remained unchanged at $0.001. All
      figures in these financial statements, including comparative information have
      been updated to give effect to the forward 2.5:1 split.





The
      acquisition has been accounted using the purchase method. The acquisition was
      reflected at the fair value of the consideration paid to the vendor of $165,000
      based on the September 12, 2005 agreement date. The amount of the consideration
      in excess of the value of assets acquired of $165,000 has been expensed in
      the
      statements of operations as impairment of goodwill.





Business
      of Issuer





Filming
      and Editing Studio


Stream
      Horizon provides the following services:





-   Video
      Editing and Encoding services.


-   Studio
      rental.


-   Casting,
      Directing, and Video / Audio production services.


-   Remote
      site video services.





Stream
      Horizon provides studio services from its location at #350 - 1152 Mainland
      Street, Vancouver, British Columbia, Canada, as well as on site or location
      shoots.





Stream
      Horizon operates the only studio we are aware of of its kind in the Vancouver
      area. Stream Horizon currently films and edits television programs and web
      based
      videos for a variety of customers at its facilities. Stream Horizon films and
      produces DVDs for several sports academies around the lower mainland of British
      Columbia.





4





Galaxy
      Hosting and Network Systems


Galaxy's
      products and services incorporate 3rd Generation streaming video technology
      and
      proprietary software to provide video streaming capabilities that allow a TV
      quality signal to be sent over the Internet or stored locally. Using a mix
      of
      the latest leading vendor software and proprietary coding, the Galaxy Encoder
      allows for push streaming of real time broadcasts and does not require a stream
      be uploaded to a server and then pulled, or accessed, by viewers. The Galaxy
      Encoder provides the facilities our customers require for capture, edit and
      content delivery of digital media. The Galaxy Encoder has been developed as
      a
      series of products which are differentiated by encoding rates.





The
      Galaxy Media Services Platform is the foundation of the Galaxy Broadcast Network
      and represents the solution for the next generation of asset management
      operations. The Platform is principally composed of computer servers, storage
      devices and network routing and transmission equipment. The delivery of
      streaming video through Galaxy's network has been optimized to provide a
      smoother, clearer and more enjoyable viewing experience, even when viewed in
      full screen mode.





The
      Galaxy Media Server system allows both content distribution via the Internet
      and
      the application of digital rights management technologies for securing such
      content. The Galaxy Media Server incorporates a storage, management, and
      distribution system and proprietary software to control the hardware platform
      with Galaxy's encoder soft-ware. Together the system can manage large volumes
      of
      entertainment programming and has content archive, search, access, serve and
      track capability. Software selects and assembles various pieces of stored
      content as separate digital files into a single continuous seamless programming
      block for playback or broadcast. Galaxy's software and management systems have
      been designed with ease of use in mind, allowing anyone with a broadband
      connection to broadcast their message to thousands of viewers worldwide. The
      Encoder was designed and developed to replace an entire room of traditional
      equipment that would otherwise be needed to drive a broadcasting
      operation.





Galaxy
      has developed technology that makes streaming of digital video easy, fast and
      cost effective and includes tracking software that lets customers know who
      views
      their video communications, the length of time they view it and, in the case
      of
      archived video, how many times they view it. This information is available
      for
      utilization by specific billing and action tracking applications.





We
      are
      currently marketing and selling our software, systems and solutions as a network
      solution for media services which we refer to as the “Galaxy Broadcast Network”.
      We provide a hosted and managed streaming video delivery system to enable
      customers to stream content to their specific audiences. Galaxy provides full
      service capabilities enabling it to receive client produced video and to encode
      it for webcasting visual media including, events, situations of interest,
      meetings, news, entertainment, shows or video for any other
      purpose.





ebahn.tv


We
      also
      offer a complete Internet television experience via ebahn.tv, our Internet
      video
      broadcast portal/web site at http://www.ebahn.tv. Recently launched, ebahn.tv
      provides TV quality program viewing via the Internet. ebahn.tv is undergoing
      constant upgrade and development as we build on our product plan. We are
      currently offering viewers with a free Internet broadcast experience featuring
      a
      mix of live streamed content and ‘video on demand' content which demonstrate our
      encoding and broadcast capabilities. ebahn.tv can deliver content both for
      mass
      delivery at low bandwidth, and in high bandwidth for viewing in HTDV with
      surround sound. We plan to offer ebahn.tv in four formats:





-
            Pay
                to Broadcast - for content providers that wish to offer their content
                via
                the Internet to their viewers. Pay to Broadcast content providers
                pay for
                hosting and bandwidth use;-
            Advertising
                Supported Programming - we will deliver free programming to viewers
                supported by advertising;-
            Pay
                TV - we will offer premium content by a Pay for View model where
                we will
                pay a portion of our revenues to the content provider.-
            Set-Top-Box
                - using a ‘set top box’s, viewers can watch on demand Internet TV
                broadcasts on their television. We provide to telcom and Internet
                resellers, the ability to aggregate and encode content and to deliver
                that
                content via the Internet or ‘set top boxes’s to the telcom or Internet
                resellers customers.




5





Markets
      and Competition


Markets
      for the Galaxy Broadcast Network and our related products and services are
      those
      business and other organizations in a variety of industries who have digital
      media which they desire other parties to view.





We
      have
      identified more specifically the following markets due to their growth
      characteristics and our experience with customers in these markets:




-
            content
                providers;-
            Internet
                Broadcast Networks (Internet TV);-
            live
                media and archival feed services;-
            digital
                video production and editing;-
            advertising
                and marketing; and-
            resellers
                and agents.





We
      plan
      to market our streaming video and Internet TV services directly to selected
      resellers and distributors and to content creators or program development
      companies or organizations. We are developing programs and plans for revenue
      generation by ebahn which we expect to launch next quarter.





Our
      business opportunity is driven by the expected growth in the volume of media
      broadcasting over the Internet. Media broadcasting platforms and services have
      proven to be difficult to manage and deploy and the results for companies are
      often less than planned. Media streaming and other media broadcasting is seeing
      significant growth, driven by among other things, the growth of Internet
      Broadcasting or Internet TV and the use of streaming media in advertising.





We
      believe we are well positioned to support the growth in media broadcasting
      and
      viewing and provide a foundation for the growth of Streaming Internet
      Broadcasting. We believe we have a proven system and technology that provides
      an
      easy to use, next generation platform solution for worldwide, almost unlimited
      ability to deliver streaming media and other encoded broadcasts over the
      Internet or other wired or wireless networks.





The
      market for streaming media services and for related services is broad and
      encompasses many different types of companies, organizations and technologies.
      We will compete with numerous providers of streaming media technology and
      services, many of which have far greater financial and other resources than
      we
      do. Many of these companies have established histories and relationships in
      providing such systems and services that enable them to attract staff and
      customers. Many of the firms within this industry are large and have
      significantly more resources for sales, marketing and research and development
      than we do.





We
      plan
      to compete within this industry by focusing on providing high value ser-vices
      within the framework of the Galaxy Broadcast Network, by continuing to develop
      our technology to maintain a technical advantage and by exploiting the market
      opportunities as outlined above. We believe it is an important competitive
      edge
      to have a fully enabled network in place and to market our system to early
      adopters, giving us an opportunity to gain an early lead and volume in the
      market and to further solidify our competitive positioning. We also plan to
      compete by providing our customers with fully capable, easy to use systems
      for
      delivery and to assisting our customers to grow their streaming needs.





6








Operation
      Development and Plan


With
      the
      acquisition of Stream Horizon Media and our Los Angeles facility, our plan
      is to
      capitalize on the market opportunity we believe is developing and to develop
      early market entry advantages with growing customers.





With
      adequate funding, we expect to undertaking the following in connection with
      our
      plan:




1.  Continue
      to
      hire staff for office administration and customer service and
      support.




2.  Market
      our
      products and services.





Our
      budget and plan is based on our current assessment of costs and application
      to
      our plan. The ultimate amounts expended under this plan will be determined
      based
      on customer acceptance and the rate of adoption of the Galaxy Broadcast Network
      platform. Management reserves the right to reallocate as necessary, any amounts
      in any budget set out above, as circumstances warrant without notice or
      correction.





Marketing


Subject
      to adequate financial support, we have budgeted $155,000 for the development
      of
      marketing materials, including: (i) the updating of our web sites at
      www.yourgalaxy.com and www.infotecbusinesssystems.com, (ii) the production
      of
      marketing and advertising materials, product support and training resources,
      and
      (iii) marketing of our products and services. We have engaged sales personnel
      for our marketing efforts, but will continue to rely on relationships and
      advertising through our customers under the slogan “Powered by Galaxy”. Given
      adequate funding, we expect to be able to engage additional marketing
      consultants and sales agents as required. We currently lack the financial
      resources to broaden our marketing efforts and fulfill this portion of our
      plan.
      A lack of financial resources will inhibit our plan and our marketing activities
      and may cause harm to our business and to the successful execution of our
      plan.





Sales
      & Technical Support


Galaxy
      provides professional levels of sales and technical support including regular
      product demonstrations through meetings and on the web via the Galaxy Broadcast
      Network.  Galaxy’s tech-nical support is available 24 hours a day, seven
      days a week.





Delivery
      and Distribution


Our
      systems and online services are established and maintained in our own and other
      co-location facilities and are accessible by our customers, 24 hours a day,
      7
      days a week via the Internet.





Development


Our
      development staff are responsible for our system operation and maintenance
      and
      for providing customer service to our existing customer base. Our development
      activities are currently focused on ongoing product improvement, system
      maintenance and upgrades, content encoding and development of the ebahn web
      portal. We have set out our assessment of the costs for development below under
      the subheadings “Property and Plant” and “Employment”. Our existing
      infrastructure is adequate to meet our customers current and short term needs,
      however, our growth is ultimately dependent on increasing our delivery
      capabilities and our ability to support and service our customer’s
      needs.





7





Property
      or Plant


With
      completion of our recent acquisitions and the opening of our server co-location
      facility or “POP” in Los Angles, we do expect to make additional capital
      purchases in the near term. Over the next twelve month period, based on our
      expected growth in operations, however, we have budgeted approximately $240,000
      in relation to the purchase of additional equipment and software for our Los
      Angeles facility and the establishment and running of one additional server
      co-location facility. Additional POP sites may be required by the Galaxy
      Broadcast Network to provide regional proximity to customers, for load balancing
      and to provide redundancy in the event one POP site is disabled or is off-line.
      We will evaluate the success of the Los Angeles POP site before proceeding
      with
      the establishment of additional sites. During the execution of this plan and
      the
      growth of the Galaxy Broadcast Network, we will evaluate additional POP sites
      based on customer proximity and bandwidth costs. We do not currently have funds
      available to undertake additional property and plant expansion.




Employment


In
      addition to our president, we engage one full time technical manager and one
      part time VP of Finance, two full time staff in our filming division, one full
      time and one part time contractor for network administration and technical
      development, one full time Media Designer, one full time receptionist and one
      full time sales person. With additional funding, our plan is to increase our
      staff levels over the next twelve month period to include a part-time Vice
      President, Controller, and Business Development persons we also plan to include
      a full time person in office and administration and additional full time staff
      member for customer support. We would also upgrade our part time network
      administrator to full time. We have budgeted the amount of $263,000 over the
      next twelve month period for such staff. As prospects and circumstances warrant,
      additional full-time and part-time employees, as well as consultants will be
      engaged to perform required services. We do not currently have funding available
      to engage additional staff as set out above.





**ITEM
      2. DESCRIPTION OF PROPERTY.**





We
      currently lease property at #150 and #350 - 1152 Mainland Street, Vancouver,
      B.C. V6B 4X2 for our principal executive offices and our subsidiary’s
      development facilities.





**ITEM
      3. LEGAL PROCEEDINGS.**





We
      are
      not currently a party to any material litigation, nor to the knowledge of
      management, is there any material litigation threatened or contemplated against
      us.





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





No
      matter
      was submitted during the fourth quarter of our fiscal year to a vote of security
      holders through the solicitation of proxies or otherwise.





8





**PART
      II**





**ITEM
      5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
      MAT-TERS.**





Our
      common stock is traded over-the-counter on the OTC Electronic Bulletin Board
      under the symbol "IFTC".  The following table sets forth the high and the
      low bid quotations quarterly for our shares of common stock during the last
      two
      fiscal years ended April 30, 2006.  The closing bid on June 30, 2006 is
      also shown.  These quotations reflect inter-dealer prices, without retail
      mark-up, mark-down or commissions and may not represent actual
      transactions.





Period
            
            High
            
            Low***2006***4th
                QuarterFebruary
                1, 2006 - April 30, 2006
            
            $
            0.21
            
            $
            0.083rd
                QuarterNovember
                1, 2005 - January 31, 2006
            
            $
            0.24
            
            $
            0.062nd
                QuarterAugust
                1, 2005 - October 31, 2005
            
            $
            0.45
            
            $
            0.0521st
                QuarterMay
                1, 2005 - July 31, 2005
            
            $
            0.068
            
            $
            0.008***2005***4th
                QuarterFebruary
                1, 2005 - April 30, 2005
            
            $
            0.07
            
            $
            0.053rd
                QuarterNovember
                1, 2004 - January 31, 2005
            
            $
            0.35
            
            $
            0.052nd
                QuarterAugust
                1, 2004 - October 31, 2004
            
            $
            0.40
            
            $
            0.081st
                QuarterMay
                1, 2004 - July 31, 2004
            
            $
            0.53
            
            $
            0.06





On
      June
      30, 2006, the closing bid price for the common stock was $0.090.





There
      are
      approximately 150 holders of record of our common stock.





Dividends


There
      are
      no restrictions in our articles of incorporation or bylaws that prevent us
      from
      declaring dividends.  The Nevada Revised Statutes, however, do prohibit us
      from declaring dividends where, after giving effect to the distribution of
      the
      dividend:





1.
      We
      would not be able to pay our debts as they become due in the usual course of
      business; or





9








2.
      Our
      total assets would be less than the sum of our total liabilities plus the amount
      that would be needed to satisfy the rights of stockholders who have preferential
      rights superior to those receiving the distribution.




We
      have
      not declared any dividends, and we do not plan to declare any dividends in
      the
      foresee-able future.




Penny
      Stock Rules


The
      SEC
      has adopted regulations which generally define a "penny stock" to be any equity
      secu-rity that has a market price of less than $5.00 per share, subject to
      certain exceptions.  Depending on market fluctuations, our common stock may
      be considered a "penny stock".  As a result, it may be subject to rules
      that impose additional sales practice requirements on broker/dealers who sell
      these securities to persons other than established customers and accredited
      investors.  For transactions cov-ered by these rules, the broker-dealer
      must make a special suitability determination for the purchase of our
      securities.  In addition the broker-dealer must receive the purchaser's
      written consent to the trans-action prior to the purchase.  The
      broker-dealer must also provide certain written disclosures to the purchaser.
       Consequently, the "penny stock" rules may restrict the ability of
      broker/dealers to sell our securities, and may negatively affect the ability
      of
      holders of our shares to resell them.





**ITEM 6. MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF
      OPERATION.**





The
      matters and items discussed in this annual report on Form 10-KSB are forward
      -looking statements that involve risks and uncertainties, other than historical
      and factual statements. Actual results of the company may differ materially
      from
      the results discussed in the forward-looking statements. Certain factors that
      could contribute to such differences are discussed with the forward-looking
      statements throughout this annual report.





The
      following discussion should be read together with the information contained
      in
      the consolidated financial statements and related notes included elsewhere
      in
      this annual report.





General


The
      company’s discussion and analysis of our financial condition and results of
      operations are based upon our consolidated financial statements, which have
      been
      prepared in accordance with accounting principles generally accepted in the
      United States. The preparation of these financial statements requires us to
      make
      estimates and judgments that affect the reported amounts of assets, liabilities,
      revenues and expenses and related disclosure of disclosure of contingent assets
      and liabilities. On an on going basis, we evaluate these estimates, including
      those related to software development expenses, financing operations and
      contingencies and litigation. We base these estimates on historical experience
      and on various other assumptions that are believed to be reasonable under the
      circumstance, the results of which form the basis for the making judgments
      about
      the carrying values of assets and liabilities that are not readily apparent
      from
      other sources. Actual results may differ from these estimates under different
      assumptions or conditions.





10





We
      believe that the following critical accounting policies affect our more
      significant judgments’ and estimates used in the preparation of our consolidated
      financial statements.





We
      recognize revenues in accordance with Securities and Exchange Commission Staff
      Accounting Bulletin No. 101. “Revenue recognition in Financial Statements”.
      Revenue is recognized only when the price is fixed or determinable, persuasive
      evidence of an arrangement exists, the service is performed, and collectibles
      is
      reasonably assured.




Operation
      Development and Plan


We
      are an
      emerging development company. Infotec has developed an Internet Content Delivery
      Network system to distribute extremely high quality video over existing networks
      for business and conventional home viewers. This is a unique development taking
      advantage of the latest technology. The company is focused on the following
      markets:




-Enable
      live content to be broadcast from any location to 100’s of thousands of
      viewers.


-Our
      integrated solution is from industry experts-we are an Application Service
      Provider (ASP)


-Corporate
      communication to employees. (Multi-level marketing - narrowcasting)


-Enable
      e-learning (e.g. coaching videos-sports)





We
      offer
      fully integrated communications and learning solutions for modular suite of
      products including hardware, software, media creation and management, corporate
      communications and content delivery. Other strategic partnerships will be
      exploited in other key areas, especially content.





Our
      core
      product offerings are:





-ISP
      Service


-Encoder
      sales


-Internet
      cable broadcaster


-Video
      Studio and post production facilities





Our
      Vision is to deploy our encoder’s world wide enabling us to aggregate content
      which we will ultimately host on our Broadcast portal. The content will
      initially consist of a wildlife reality channel, (online Zoo). Several TV
      Channels, in multiple languages, and our own independent music artist’s video
      channel. In time we will add sports, as well as international TV channels.
      Each
      of our channels will have multiple revenue streams to create basic advertising
      support to pay per view to subscriber fees. We will continue to create content
      for our customers but also utilize our studio to generate content for our own
      audience.





This
      model has been tested using our Eagle cam. We have gained experience in selling
      advertising, bandwidth requirements, exact costing, end user satisfaction and
      an
      accurate stream per daily viewer ratio. Our Eagle Cam has experienced a peak
      of
      14,000,000 page loads per day, with up to 15,000 simultaneous broadband streams,
      as well as an impressive 500,000 unique visitors per day.





Our
      strengths and advantages:





There
      are
      many reasons why the Infotec solution is setting the industry
      standard.





11





-We
      have
      many years of experience, with our existing customer base.


-The
      Infotec network is designed with Streaming media in mind, the focus of our
      content delivery system, is Streaming media servers, and traffic
      throughput.


-The
      ease
      of use of the Galaxy Encoder product, which has already enabled a variety of
      live experiences including; live casting sessions, wildlife experiences,
      conference streaming, live TV streams and the list goes weekly.





Results
      of Operations


Our
      April
      30, 2006 audited consolidated financial statements have been prepared on the
      basis of the accounts and operations of Galaxy Networks Inc. from incorporation,
      December 13, 2002 to April 30, 2006 and incorporate the accounts and operations
      for Infotec Business Systems, Inc., Galaxy Networks Inc., Stream Horizon Studios
      Ltd. (formerly “Infotec Business Strate-gies, Inc.”) and Galaxy US Networks Inc.
      (formerly “Eventec Inc.”) from December 13, 2002 to April 30, 2006.





For
      the
      year ended April 30, 2006, we incurred a loss from operations of $1,612,267.
      Revenues, net of costs of goods sold were $119,037 in the period.  Our
      principal areas of expenditure during the period were for Accounting and Legal
      fees of $80,980, management fees of $220,940, administration of $990,879, rent
      of $52,826, subcontractor fees of $61,756, wages & benefits of $50,907 and
      depreciation charges of $70,649. Accounting and Legal fees, administration
      and
      management fees reflect costs incurred for initial regulatory filings and
      executive staffing respectively. Costs incurred in the year ended April 30,
      2006
      increased over the comparative period due to the completion of our earlier
      development, program and the reor-ganization of Galaxy, Stream Horizon and
      Infotec.





Liquidity
      and Capital Resources


As of April 30, 2006, we had an accumulated
      deficit of $2,010,253 and a bank overdraft of $7,008.  Our working capital
      deficit at April 30, 2006 was $1,439,657.  The accumulated deficit and our
      working capital deficit was funded by proceeds from the issuance of common
      shares, advances from related parties and accounts payable to
      suppliers.





Our working capital is currently insufficient to
      sustain our current operations.  Our operations are currently dependent on
      our supplier’s willingness and ability to continue to provide services without
      some assurance of payment.  Our plan is to seek additional funding and
      business relationships.





12





While management believes that sales
      revenues can be grown and that ultimately profitable operations can be attained
      in the future, there is no assurance that sales revenues will be maintained
      or
      grown or that they will ultimately be of a level required to generate profitable
      operations or provide positive cash flow.  We are unable to predict at this
      time the exact amount of any additional working capital we will require to
      fund
      the implementation of our business plan and achieve cash flow suffi-cient to
      sustain operations and achieve profitability.  To fund our operations and
      more fully implement our business plan, we may seek additional capital in the
      private and/or public equity markets through the sale of equity or debt
      securities.  If we receive additional funds through the issuance of equity
      securities, however, our existing stockholders may experience significant
      dilution.  If we issue new securities, they may contain certain rights,
      preferences or privileges that are senior to those of our common stock.
      Moreover, we may not be successful in obtaining additional financing when needed
      or on terms favorable to our stockholders.  As we have no commitments from
      any third parties to provide additional equity or debt funding, we cannot
      provide any assurance that we will be successful in attaining such additional
      funding.





We currently market a range of products and
      services, however, we have limited revenues and limited operating history from
      which to assess our operations.  Due to our lack of revenue-production
      history and our lack of contractual commitments to generate profits, there
      is no
      basis at this time for investors to make an informed determination as to the
      prospects for our future success.  For this reason and, as we have not
      achieved profitable operations and require additional capital to achieve our
      objec-tives, our auditors have included in their report covering our financial
      statements for the period from incorporation to April 30, 2006, that there
      is
      substantial doubt about our ability to continue as a going concern.





Additional
      Risk Factors


As noted throughout this annual report,
      Infotec Business Systems, Inc., is an emerging devel-opment stage company and
      accordingly, there are many risks that affect our operations and our ultimate
      viability.  It is not possible, however, to foresee all risks which may
      affect us.  Moreover, we cannot predict the magnitude of each risk nor can
      we predict whether we will successfully effectuate our current business plan.
       Each prospective investor is encouraged to carefully analyze the risks and
      merits of an investment in our securities and to take into consideration when
      making such analysis, among others, the financial risks discussed under the
      subheading "Liquidity and Capital Resources" above and the additional risk
      factors we have set out below.





Operating
      History - We are
      presently in the process of marketing products and services which we have
      developed or acquired.  We have only a limited operating history from which
      investors can evaluate our future business prospects or management’s
      performance.  As a result, you have no reli-able means to determine whether
      you should make an investment in this company.





Marketable
      Products - In
      order to sell our products and services, we must demonstrate to poten-tial
      customers that we have systems and services that are functional, supported,
      cost
      effective and address their needs.  We haves developed products and
      services which we have introduced and from which we are receiving sales
      revenues.  At present however, we have only limited history in offering and
      supporting these product offerings. If products and services we offer do not
      meet customer needs and if customers are not convinced we can maintain, support
      and upgrade our offerings in future, or if our products contain product flaws
      or
      bugs, we will not be able to successfully market our products and services
      or
      earn revenues.





13





Staff
      Availability - In
      addition to our president, we engage one full time technical manager and one
      part time VP of Finance, two full time staff in our filming division, one full
      time and one part time contractor for network administration and technical
      development, one full time Media Designer, one full time receptionist and one
      full time sales person. We
      currently have employment agreements with the directors, officers and employees
      we depend on for the successful implementation of our plan.





Competition - We
      face competition from a wide range of firms in the streaming media and host-ing
      services industry.  These companies include large, well established and
      financially stronger companies.  We do not currently have resources to
      compete and may never have sufficient funds to be able to refine our offerings
      and successfully market our offerings so that we may become a factor in the
      industry.  These competitive disadvantages represent another factor which
      may cause investors in our securities to lose the value of their
      investment.





Management
      Control -
      Current management owns or controls approximately 36.86% of the
      out-standing shares of our common stock.  Accordingly, they have almost
      complete influence in determining the outcome of all corporate transactions
      and
      business decisions.  The interests of man-agement may differ from the
      interests of the other stockholders, and since they have the ability to control
      most decisions through their control of our common stock, investors will have
      limited ability to affect decisions made by management.








**ITEM 7. FINANCIAL
      STATEMENTS.**





Annual Audited
              Financial Statements
            PageReport
                of Independent Registered Public Accounting Firm
            F-1Consolidated
                Financial StatementsConsolidated
                Balance Sheets
            F-2Consolidated
                Statements of Operations
            F-3Consolidated
                Statement of Stockholders’ Equity (Deficit)
            F-4Consolidated
                Statements of Cash Flows
            F-5Notes
                to Consolidated Financial Statements
            F-6
                - F-10




14





**REPORT
      OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**





To
      the
      Board of Directors of Infotec Business Systems, Inc. and
      Subsidiaries





We
      have
      audited the accompanying consolidated balance sheet of Infotec Business Systems,
      Inc. and Subsidiaries (a development stage company) (the Company) as of April
      30, 2006 and 2005 and the related consolidated statements of operations,
      stockholders’ equity (deficit) and cash flows for the years then ended and for
      the period from inception (December 13, 2002) through April 30, 2006. These
      consolidated financial statements are the responsibility of the Company’s
      management. Our responsibility is to express an opinion on these consolidated
      financial statements based on our audits.





We
      conducted our audits in accordance with the standards of the Public Company
      Accounting Oversight Board (United States).  Those standards require that
      we plan and perform the audit to obtain reasonable assurance about whether
      the
      financial statements are free of material misstatement. The Company is not
      required to have, nor were we engaged to perform, an audit of its internal
      control over financial reporting. Our audit includes consideration of internal
      controls over financial reporting as basis for designing audit procedures that
      are appropriate in the circumstances, but not for the purpose of expressing
      an
      opinion on the effectiveness of the Company’s internal control over financial
      reporting. Accordingly, we express no such opinion.  An audit includes
      examining, on a test basis, evidence supporting the amounts and disclosures
      in
      the financial statements.  An audit also includes assessing the accounting
      principles used and significant estimates made by management, as well as
      evaluating the overall financial statement presentation.  We believe that
      our audits provide a reasonable basis for our opinion.





In
      our
      opinion, the consolidated financial statements referred to above present fairly,
      in all material respects, the financial position of Infotec Business Systems,
      Inc. and Subsidiaries as of April 30, 2006 and 2005, and the results of its
      operations and cash flows for the years then ended and for the period from
      inception (December 13, 2002) through April 30, 2006, in conformity with
      accounting principles generally accepted in the United States of
      America.





The
      accompanying consolidated financial statements have been prepared assuming
      the
      Company will continue as a going concern. As discussed further in Note 3, the
      Company has been in the development stage since its inception (December 13,
      2002) and continues to incur significant losses. The Company’s viability is
      dependent upon its ability to obtain future financing and the success of its
      future operations. These factors raise substantial doubt about the Company’s
      ability to continue as a going concern. Management’s plan in regard to these
      matters is also described in Note 3. The consolidated financial statements
      do
      not include any adjustments that might result from the outcome of this
      uncertainty.





**Mendoza
      Berger & Company, LLP**





/s/
      Mendoza Berger & Company, LLP





July
      10,
      2006


Irvine,
      California





F-1




**Infotec
                Business Systems, Inc. and Subsidiaries***(A
                Development Stage Company)**Consolidated
                Balance Sheets*April
                302006
            
            2005*Assets*Current
                AssetsCash
            
            $
            -
            
            $
            3,544Accounts
                receivable
            
            
            101,735
            
            
            1,731Accounts
                receivable - related party
            
            
            13,741
            
            
            1,957Prepaid
                expenses
            
            
            4,789
            
            
            1,589Total
                Current Assets
            
            
            120,265
            
            
            8,821Property
                and Equipment (Note 4(d) and 9)
            
            
            244,912
            
            
            28,378Accumulated
                Depreciation (Note 4(e))
            
            
            (86,277
            )
            
            (11,747
            )Net
                Property and Equipment
            
            
            158,635
            
            
            16,631Intangible
                Assets (Note 4)
            
            
            3,512
            
            
            -Accumulated Amortization
            
            
            (447
            )
            
            -Net
                Intangible Assets
            
            
            3,065
            
            
            -Goodwill
                (Note 5)
            
            
            687,369
            
            
            -Total
                Assets
            
            $
            969,334
            
            $
            25,452**Liabilities
                and Stockholders’ Equity (Deficit)**Current
                LiabilitiesBank
                overdraft
            
            $
            7,008
            
            $
            0Accounts
                payable
            
            
            126,483
            
            
            32,298Accounts
                payable - related party (Note 11(c))
            
            
            133,302
            
            
            129,141Deferred
                Revenue
            
            
            4,000
            
            
            -Loans
                Payable to Stockholders (Note 6)
            
            
            177,563
            
            
            -Due
                to related party (Note 10)
            
            
            145,337
            
            
            18,500Compensation
                Payable (Note 7)
            
            
            966,229
            
            
            -Total
                Current Liabilities
            
            
            1,559,922
            
            
            179,939Stockholders’
                Equity (Deficit)Preferred
                stock, voting; $0.001 par value; 375,000,000 shares
                authorized;no
                shares issued and outstanding at April 30, 2006 and 2005,
                respectively
            
            
            -
            
            
            -Common
                stock, voting; $0.001 par value; 750,000,000 shares
                authorized;121,500,000
                and 101,250,000 shares issued and outstanding atApril
                30 2006 and 2005, respectively
            
            
            121,500
            
            
            101,250Additional
                paid in capital
            
            
            1,284,050
            
            
            139,300Accumulated
                other comprehensive income
            
            
            14,114
            
            
            2,948Deficit
                accumulated during the development stage
            
            
            (2,010,252
            )
            
            (397,985
            )Total
                Stockholders’ Equity (Deficit)
            
            
            (590,588
            )
            
            (154,487
            )Total
                Liabilities and Stockholders’ Equity
            
            $
            969,334
            
            $
            25,452





(The
      accompanying notes are an integral part of these financial
      statements)





F-2





**Infotec
                Business Systems, Inc. and Subsidiaries***(A
                Development Stage Company)**Consolidated
                Statements of Operations*Cumulativeamountfrom
                inception(December
                13,2002For
                the year ended
            
            throughApril
                30, 2006
            
            April
                30,2005
            
            April
                30, 2006Revenues
            
            $
            187,448
            
            $
            17,267
            
            $
            218,393Revenues
                from related parties (Note 11(b))
            
            
            -
            
            
            1,676
            
            
            1,676Cost
                of goods sold
            
            
            (68,411
            )
            
            (10,319
            )
            
            (79,735
            )Gross
                Profit
            
            
            119,037
            
            
            8,624
            
            
            140,334ExpensesAccounting
                and
                Legal
            
            
            80,980
            
            
            27,199
            
            
            108,636Administration
                Fees
            
            
            990,879
            
            
            -
            
            
            990,879Acquisition
                fees
            
            
            -
            
            
            90,000
            
            
            90,000Depreciation
            
            
            70,649
            
            
            4,995
            
            
            81,150Management
                Fees
                (Note 11(a))
            
            
            220,940
            
            
            15,141
            
            
            264,097Office
                and telephone
            
            
            19,740
            
            
            4,791
            
            
            25,922Rent
                and Insurance
            
            
            52,826
            
            
            -
            
            
            52,826Subcontracts
            
            
            61,756
            
            
            -
            
            
            61,756Travel
            
            
            17,627
            
            
            -
            
            
            17,627Wages
                and Benefits
            
            
            50,907
            
            
            -
            
            
            50,907Total
                Expenses
            
            
            1,566,304
            
            
            142,126
            
            
            1,743,800Operating
                Loss
            
            
            (1,447,267
            )
            
            (133,502
            )
            
            (1,603,466
            )Other
                income and ExpensesImpairment
                of
                Goodwill
            
            
            (165,000
            )
            
            -
            
            
            (165,000
            )Net
                loss before taxes
            
            
            (1,612,267
            )
            
            (133,502
            )
            
            (1,768,466
            )Provision
                for income taxes (Note 8)
            
            
            -
            
            
            -
            
            
            -Net
                Loss
            
            
            ($1,612,267
            )
            
            ($133,502
            )
            
            (1,768,466
            )Net
                Loss Per Share  (Basic and Diluted)
            
            $
            (0.01
            )
            $
            (0.00
            )Weighted
                Average Shares Outstanding
              (Basic
                and Diluted)
            
            
            113,203,425
            
            
            29,480,738





(The accompanying notes are an integral part of these financial
      statements)





F-3


**Infotec
                    Business Systems, Inc. and Subsidiaries***(A
                    Development Stage Company)**Consolidated
                  Statements of Stockholders’ Equity
                  (Deficit)*Preferred
                    Stock
                
                
                Common
                    Stock
                
                
                
                
                
                
                
                
                Deficit
                  accumulated
                
                
                TotalNumber
                    of
                    shares
                
                
                Amount
                
                
                Number
                    of
                    shares
                
                
                Amount
                
                
                Paid-in
                    capital
                
                
                Compre-
                      hensive
                      Income
                
                
                during
                            the
                          development
                          stage
                
                
                stockholders'
                        equity
                        (deficit)Balance
                    at inception - December 13, 2002
                
                
                -
                
                $
                -
                
                
                -
                
                $
                -
                
                $
                -
                
                $
                -
                
                $
                -
                
                $
                -Stock
                    issued for:Cash
                
                
                -
                
                
                -
                
                
                15,000,000
                
                
                15,000
                
                
                (14,838
                )
                
                -
                
                
                -
                
                
                162Equipment
                
                
                -
                
                
                -
                
                
                20,000,000
                
                
                20,000
                
                
                (3,449
                )
                
                -
                
                
                -
                
                
                16,551Stock
                    issued for cash:December
                    14, 2002
                
                
                -
                
                
                -
                
                
                15,000,000
                
                
                15,000
                
                
                (2,035
                )
                
                -
                
                
                -
                
                
                12,965Net
                    (loss) for the period
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                (12,172
                )
                
                (12,172
                )Adjustment
                    forForeign
                    currency translation adjustment
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                742
                
                
                -
                
                
                742Comprehensive
                    (loss)
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                (11,430Balance
                    - April 30, 2003
                
                
                -
                
                
                -
                
                
                50,000,000
                
                
                50,000
                
                
                (20,322
                )
                
                742
                
                
                (12,172
                )
                
                18,248Net
                    (loss) for the period
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                (10,525
                )
                
                (10,525
                )Adjustment
                    forForeign
                    currency translation adjustment
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                (165
                )
                
                -
                
                
                (165
                )Comprehensive
                    (loss)
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                (10,690
                )Balance
                    - April 30, 2004
                
                
                -
                
                
                -
                
                
                50,000,000
                
                
                50,000
                
                
                (20,322
                )
                
                577
                
                
                (22,697
                )
                
                7,558Stock
                    issued for:Acquisition
                
                
                -
                
                
                -
                
                
                45,875,000
                
                
                45,875
                
                
                (37,203
                )
                
                -
                
                
                (241,786
                )
                
                (233,114
                )Services
                
                
                -
                
                
                -
                
                
                1,250,000
                
                
                1,250
                
                
                88,750
                
                
                -
                
                
                -
                
                
                90,000Stock
                    issued for settlement ofConsulting
                    fees
                
                
                -
                
                
                -
                
                
                4,125,000
                
                
                4,125
                
                
                108,075
                
                
                -
                
                
                -
                
                
                112,200Net
                    (loss) for the period
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                (133,502
                )
                
                (133,502
                )Adjustment
                    forForeign
                    currency translation adjustment
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                2,371
                
                
                -
                
                
                2,371Comprehensive
                    (loss)
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                (131,131
                )Balance
                    - April 30, 2005
                
                
                -
                
                
                -
                
                
                101,250,000
                
                
                101,250
                
                
                139,300
                
                
                2,948
                
                
                (397,985
                )
                
                (154,487
                )Stock
                      issued for:Private
                    placement for cash (Note 7)
                
                
                -
                
                
                -
                
                
                5,000,000
                
                
                5,000
                
                
                245,000
                
                
                -
                
                
                -
                
                
                250,000Business
                    acquisition (Note 10)
                
                
                -
                
                
                -
                
                
                12,500,000
                
                
                12,500
                
                
                737,500
                
                
                -
                
                
                -
                
                
                750,000Share
                    purchase agreement (Note 10)
                
                
                -
                
                
                -
                
                
                2,750,000
                
                
                2,750
                
                
                162,250
                
                
                -
                
                
                -
                
                
                165,000Net
                    (loss) for the period
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                (1,612,267
                )
                
                (1,612,267
                )Adjustment
                    forForeign
                    currency translation adjustment
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                11,166
                
                
                -
                
                
                11,166Comprehensive
                    (loss)
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                (1,601,151
                )Balance
                    - April 30, 2006
                
                
                -
                
                $
                -
                
                
                121,500,000
                
                $
                121,500
                
                $
                1,284,050
                
                $
                14,114
                
                $
                (2,010,252
                )
                $
                (590,588
                )


(The
        accompanying notes are an integral part of these financial
        statements)
 F-4


**Infotec
                Business Systems, Inc. and Subsidiaries***(A
                Development Stage Company)**Consolidated
                Statements of Cash Flows*Cumulativeamount
                frominceptionFor
                  the year endedApril
                30,
            
            (December
                13,
              2002
                to April 30,2006
            
            2005
            
            2006)Cash
                Flows From Operating ActivitiesNet
                Loss
            
            
            ($1,612,267
            )
            
            ($133,502
            )
            
            ($1,729,490
            )Adjustments
                to reconcile net loss to cashDepreciation
            
            
            70,649
            
            
            4,995
            
            
            47,174Acquisition
                fees
            
            
            -
            
            
            90,000
            
            
            90,000Impairment of goodwill
            
            
            165,000
            
            
            -
            
            
            165,000Changes
                in working capital itemsIncrease
                (decrease)  in bank overdraft
            
            
            7,008
            
            
            -
            
            
            7,008Increase
                (decrease)  in accounts payable
            
            
            94,185
            
            
            (93,495
            )
            
            (3,292
            )Increase
                (decrease) in accounts payable- related party
            
            
            4,161
            
            
            124,318
            
            
            133,302Increase
                in unearned revenue
            
            
            4,000
            
            
            -
            
            
            4,000Increase
                in due to related parties
            
            
            126,837
            
            
            18,500
            
            
            145,337Increase
                in compensation payable
            
            
            966,229
            
            
            -
            
            
            966,229(Increase)
                decrease in accounts receivable
            
            
            (100,004
            )
            
            (1,560
            )
            
            (101,564
            )(Increase)
                decrease in accounts receivable- related party
            
            
            (11,784
            )
            
            (1,957
            )
            
            (13,741
            )Decrease
                  in prepaid expenses
            
            
            (3,200
            )
            
            748
            
            
            (2,452
            )Net
                Cash Provided By (Used in)Operating
                 Activities
            
            
            (289,186
            )
            
            8,047
            
            
            (292,489
            )Cash
                Flows to Investing ActivitiesAcquisition
                of property and equipment
            
            
            (139,892
            )
            
            (5,868
            )
            
            (147,877
            )Acquisition of intangible assets
            
            
            (3,512
            )
            
            -
            
            
            (3,512
            )Net
                Cash Used in Investing  Activities
            
            $
            (143,404
            )
            
            (5,868
            )
            $
            (151,389
            )Cash
                Flows from Financing  ActivitiesIncrease
                in loans payable to stockholders
            
            
            177,563
            
            
            -
            
            
            177,563Cash
                received in recapitalization
            
            
            -
            
            
            1,353
            
            
            1,353Proceeds
                from issuance of common stock
            
            
            250,000
            
            
            -
            
            
            263,127Net
                Cash provided by Financing Activities
            
            
            427,563
            
            
            1,353
            
            
            442,043Increase
                (Decrease) in Cash in the Period
            
            
            (5,027
            )
            
            3,532
            
            
            (1,835
            )Comprehensive
                gain (loss) on translation
            
            
            1,483
            
            
            (225
            )
            
            1,835Cash
                - Beginning of Period
            
            
            3,544
            
            
            237
            
            
            -Cash
                - End of Period
            
            $
            -
            
            $
            3,544
            
            $
            -**Non-Cash
                Financing Activities**Common
                shares issued for equipment
            
            $
            76,642
            
            $
            -
            
            $
            93,193**Supplementary
                Disclosure of Non-Cash Items**Net
                liabilities assumed in recapitalization
            
            $
            -
            
            
            ($234,467
            )
            
            ($234,467
            )Issuance
                of common stock for purchase goodwill
            
            $
            838,358
            
            $
            -
            
            $
            838,358Issuance
                of common stock for services
            
            $
            -
            
            $
            -
            
            $
            -Issuance
                of common stock for consulting
            
            $
            -
            
            $
            112,200
            
            $
            112,200





(The
      accompanying notes are an integral part of these financial
      statements)


F-5





**Infotec
      Business Systems, Inc. and Subsidiaries**


*(A
      Development Stage Company)*


*Notes
      to Consolidated Financial Statements*








**1.**  **Development
      Stage Company**





Infotec
      Business Systems, Inc. a Nevada corporation, incorporated October 1, 2001 and
      its wholly owned subsidiaries  Galaxy Networks Inc., a British Columbia
      corporation incorporated December 13, 2002, Stream Horizon Studios Ltd.
      (formerly “Infotec Business Strategies, Inc.”), a British Columbia corporation
      incorporated August 30, 2001 and Galaxy US Networks Inc, (formerly “Eventec
      Inc.”), a Nevada corporation incorporated April 25, 2003, (herein collectively
      referred to as “Infotec” or as the “Company”) is a development stage company
      engaged in the business of commercializing digital media encoder technology
      through the development of strategic alliances with major video
      producers.





The
      Company is engaged in the development of third generation Internet Services.
       The development is currently focused on Streaming Video.





**2.**  **Reorganization**





As
      of
      November 11, 2004, the Company entered into an agreement which provided for
      the
      reorganization of Galaxy Networks Inc., with and into Infotec Business Systems,
      Inc., becoming a wholly owned subsidiary of Infotec Business Systems, Inc.
       The agreement is for the exchange of 100% of the outstanding Common Stock
      (Class A Common Stock) of Galaxy Networks Inc., for 20,000,000 (50,000,000
      post-split) shares of Infotec Business Systems, Inc.’s $0.001 par value Common
      Stock.





The
      former shareholders of Galaxy Networks Inc. acquired control of the Company
      upon
      the closing of the share exchange transaction.  The exchange was accounted
      for as a reverse acquisition.  Accordingly, for financial statement
      purposes, Galaxy Networks Inc. was considered the accounting acquirer and the
      related business combination was considered a recapitalization of Galaxy
      Networks Inc. rather than an acquisition by the Company.  The historical
      financial statements prior to the agreement will be those of Galaxy Networks
      Inc. and the name of the consolidated company going forward is Infotec Business
      Systems, Inc.





Concurrent
      with the reorganization the Company issued 500,000 (12,500,000
      post-split) shares
      of Common Stock for services valued at $90,000.





On
      September 30, 2005, the Company entered into an acquisition agreement with
      the
      proprietor of Stream Horizon Media (Stream Horizon), a British Columbia sole
      proprietorship which provided for the acquisition by Infotec Business
      Strategies, Inc., a wholly-owned subsidiary of the Company, of 100% interest
      in
      the business and assets of Stream Horizon, in exchange for the issuance of
      5,000,000 (12,500,000 post-split) common shares of the Company. The aggregate
      purchase price and the value of the common shares issued in consideration was
      determined to be $750,000 based on the market price of the Company ’ s
      common
      shares on the September 12, 2005, the date of substantive agreement between
      the
      parties.





The
      acquisition included the assets, business operations and assumption of lease
      liability of Stream Horizon exclusive of working capital items and any
      indebtedness or other obligations. The acquisition has been accounted using
      the
      purchase method. The results of Stream Horizon have been included in the
      consolidated financial statements since October 1, 2005.





On
      September 30, 2005, the Company entered into a definitive acquisition agreement
      with the stockholder of ebahn Television Network Corp., a Nevada company, which
      formalized their agreement of September 12, 2005 to acquire a 100% interest
      in
      ebahn and the stockholders’ debt payable by ebahn, in exchange for the issuance
      of 1,100,000 (2,750,000 post-split) common shares of the Company.





The
      acquisition has been accounted using the purchase method. The acquisition was
      reflected at the fair value of the consideration paid to the vendor of $165,000
      based on the September 12, 2005 agreement date. The amount of the consideration
      in excess of the value of assets acquired of $165,000 has been expensed in
      the
      statements of operations as impairment of goodwill.





F-6


**Infotec
      Business Systems, Inc. and Subsidiaries**


*(A
      Development Stage Company)*


*Notes
      to Consolidated Financial Statements*




**3.**  **Going
      Concern**





In
      a
      development stage company, management devotes most of its activities to
      establishing a new business primarily, the development of a detailed business
      plan, marketing strategy and the raising of funds required to develop and
      operate the business successfully.  Planned principal activities have not
      yet produced material revenues and the Company has suffered recurring operating
      losses as is normal in development stage companies.  These factors raise
      doubt about the Company’s ability to continue as a going concern.





The
      ability of the Company to emerge from the development stage with respect to
      its
      planned principal business activity is dependent upon its successful efforts
      to
      raise additional equity financing, receive funding from affiliates and
      controlling shareholders, and develop a market for its products.





In
      order
      to meet expenses over the next twelve months the Company is actively searching
      for additional equity financing.  See Note 2 regarding the Company’s
      reorganization.





**4.**  **Summary
      of Significant Accounting Policies**





(a)
      Principals of Consolidation


These
      consolidated financial statements include the accounts of the Company and its
      wholly owned subsidiaries since the Company’s inception on December 13, 2002.
 All significant intercompany accounts and transactions have been
      eliminated.





(b)
      Development Stage Company


The
      Company is a development stage company as defined in the Statements of Financial
      Accounting Standards No. 7.  The Company is devoting substantially all of
      its present efforts to establish a new business and has only recently commenced
      its planned principal operations.  All losses accumulated since inception
      have been considered as part of the Company’s development stage
      activities.





(c)
      Software Development Costs


Software
      development costs are charged to expense as incurred unless the development
      project meets the criteria under United States generally accepted accounting
      principles for capitalization.  Capitalization of software development
      costs begins upon the establishment of technological feasibility and ceases
      when
      the product is available for general release.  The Company has no
      capitalized software development costs at April 30, 2006 and 2005
      respectively.





(d)
      Property and Equipment


Computer
      equipment, office equipment and demonstration equipment are stated at cost
      and
      depreciated over the estimated useful lives of the related assets using the
      straight-line method. The estimated useful lives for computer equipment and
      office equipment are five years and for demonstration equipment, three
      years.




Office
                equipment - computers
            3
                yearsOffice
                equipment - other
            5
                yearsDemonstration
                equipment
            3
                yearsServer
                systems
            5
                yearsSoftware
            1
                yearsStudio
                equipment
            5
                yearsLeasehold
                Improvements
            Over
                the term of the lease





(e)Goodwill
      and Other Intangible Assets


Goodwill
      and other Intangible Assets are accounted for in accordance with the Statements
      of Financial Accounting Standards No. 142, “Goodwill and Other Intangible
      Assets”. Intangible assets are recorded at cost and where appropriate, amortized
      over the estimated lives of the related intangible assets using the straight
      line method. The estimated life of IP addresses has been determined to be three
      years from the date of the Company’s acquisition. Goodwill is recorded at cost.
      Management reviews the carrying cost of goodwill during the Company’s fiscal
      year, at such times as changes in the underlying assumptions as to the future
      value of goodwill arise. During the year ended April 30,2006, the Company
      purchased a block of IP addresses for $3,512. This asset is being amortized
      over
      8 years.





F-7


**Infotec
      Business Systems, Inc. and Subsidiaries**


*(A
      Development Stage Company)*


*Notes
      to Consolidated Financial Statements*





**4.**  **Summary
      of Significant Accounting Policies (continued)**





(f)
      Impairment of Long Lived Assets


Long-lived
      assets, such as property, plant, and equipment, and purchased intangibles
      subject to amortization, are reviewed for impairment whenever events or changes
      in circumstances indicate that the carrying amount of an asset may not be
      recoverable. Such events or circumstances include, but are not limited to,
      a
      significant decrease in the fair value of the underlying business, a significant
      decrease in the benefits realized from an acquired business, difficulties or
      delays in integrating the business or a significant change in the operations
      of
      an acquired business. Recoverability of assets to be held and used is measured
      by a comparison of the carrying amount of an asset to estimated undiscounted
      future cash flows expected to result from its use and eventual disposition.
      If
      the carrying amount of an asset exceeds its estimated future cash flows, an
      impairment charge is recognized for the amount by which the carrying value
      of
      the assets exceeds its fair value. If a readily determinable market price does
      not exist, fair value is estimated using discounted expected cash flows
      attributable to the assets. Assets to be disposed of are separately presented
      on
      the balance sheet and reported at the lower of their carrying amount or fair
      value less costs to sell, and are no longer depreciated.





(g)
      Basic
      and Diluted Net Income (Loss) per Share


The
      Company computes net income (loss) per share in accordance with SFAS No. 128,
      “Earnings per Share” (SFAS 128). SFAS 128 requires presentation of both basic
      and diluted earnings per shares (EPS) on the face of the income statement.
       Basic EPS is computed by dividing net income (loss) available to common
      shareholders (numerator) by the weighted average number of common shares
      outstanding (denominator) during the period.  Diluted EPS gives effect to
      all dilutive potential common shares outstanding during the period including
      stock options, using the treasury stock method, and convertible preferred stock,
      using the if-converted method. In computing Diluted EPS, the average stock
      price
      for the period is used in determining the number of shares assumed to be
      purchased from the exercise of stock options or warrants.  Diluted EPS
      excludes all dilutive potential common shares if their effect is antidilutive.
      The Company has no stock equivalents which would dilute earnings per share.





(h)
      Foreign Currency Transactions/Balances


The
      operations of the Company are located in British Columbia, Canada and its
      functional currency is the Canadian dollar.  These financial statements
      where applicable have been translated using the current method whereby monetary
      assets and liabilities are translated at the year end exchange rate, capital
      accounts are at historic exchange rates and revenues and expenses at the average
      exchange rate for the period.





(i)
      Financial Instruments


The
      Company’s financial instruments consist of cash, accounts receivable, and
      accounts payable.  The estimated fair value of these financial instruments
      approximate their carrying values, unless otherwise noted.





(j)
      Use
      of Estimates


The
      preparation of financial statements in conformity with generally accepted
      accounting principles requires management to make estimates and assumptions
      that
      affect the reported amounts of assets and liabilities and disclosure of
      contingent assets and liabilities at the date of the financial statements and
      the reported amounts of revenues and expenses during the periods.  Actual
      results could differ from those estimates.





(k)
      Revenue Recognition


The
      Company recognizes revenue in accordance with Securities and Exchange Commission
      Staff Accounting Bulletin No. 101 (“SAB 101”), “Revenue Recognition in Financial
      Statements”. Revenue is recognized only when the price is fixed or determinable,
      persuasive evidence of an arrangement exists, the service is performed, and
      collectibility is reasonably assured.





F-8


**Infotec
      Business Systems, Inc. and Subsidiaries**


*(A
      Development Stage Company)*


*Notes
      to Consolidated Financial Statements*




**4.**  **Summary
      of Significant Accounting Policies (continued)**





(l)Software
      Development Costs


Software
      development costs are charged to expense as incurred unless the development
      project meets the criteria under United States generally accepted accounting
      principles for capitalization. Capitalization of software development costs
      begins upon the establishment of technological feasibility and ceases when
      the
      product is available for general release. The Company has no capitalized
      software development costs at April 30, 2006 and April 30, 2005
      respectively.





(m)
      Income Taxes


Deferred
      income taxes are reported using the liability method. Deferred tax assets are
      recognized for deductible temporary differences and deferred tax liabilities
      are
      recognized for taxable temporary differences. Temporary differences are the
      differences between the reported amounts of assets and liabilities and their
      tax
      bases. Deferred tax assets are reduced by a valuation allowance when, in the
      opinion of management, it is more likely than not that some portion or all
      of
      the deferred tax assets will not be realized. Deferred tax assets and
      liabilities are adjusted for the effects of changes in tax laws and rates on
      the
      date of enactment.





(n)
      Recent Pronouncements


All
      recent accounting pronouncements have been applied as appropriate.  The
      Company has taken into account all other recent pronouncements and has
      determined that they have no effect on the Company's consolidated financial
      statements.





**5.
      Goodwill**





The
      changes in the carrying amount of goodwill for the year ended April 30, 2006
      are
      as follows:





Balance
                as at April 30, 2005
            
            $
            -Goodwill
                acquired in the periodebahn
                Television Network Corp.
            
            
            165,000Stream
                Horizon Media
            
            
            673,358Currency
                translation adjustment
            
            
            14,011Impairment
                losses
            
            
            (165,000
            )Balance
                as at April 30, 2006
            
            $
            687,369




**6.
      Loans Payable to Stockholders**





Loans
      to
      the Company by stockholders are non-interest bearing and have no fixed date
      for
      repayment. The total amount advanced at April 30, 2006 and April 30, 2005 was
      $177,563 and $0 respectively.





**7.
      Compensation payable**





The
      total
      amount of compensations payable at April 30, 2006 and April 30, 2005 was
      $966,229 and $0 respectively. $960,000 will be paid upon the issuance of stock,
      and $6,229 is an accrual for vacation pay, sick pay and car allowance for the
      Company’s president, these will be paid upon use or on February 8, 2007 if not
      used.





F-9


**Infotec
      Business Systems, Inc. and Subsidiaries**


*(A
      Development Stage Company)*


*Notes
      to Consolidated Financial Statements*




**8.**  **Income
      Taxes**





The
      components of the deferred tax assets are as follows at April 30:





2006
            
            2005Deferred
                tax assets:Net
                non-capital loss carry-forward
            
            $
            99,000
            
            $
            41,000Net
                operating loss carry-forward
            
            
            686,000
            
            
            248,000Depreciation/Amortization
                allowance
            
            
            47,000
            
            
            -Valuation
                allowance
            
            
            (832,000
            )
            
            (289,000
            )Net
                deferred tax assets
            
            $
            -
            
            $
            -





The
      Company had available approximately $2,017,000 of unused net operating loss
      carry-forwards at April 30, 2006 that may be applied against future United
      States taxable income. These net operating loss carry-forwards expire for
      Federal purposes through 2025. There is no assurance that the Company will
      realize the benefit of the net operating loss carry-forwards.





The
      Company had available approximately $288,000 unused non-capital loss
      carry-forwards at April 30, 2006, that may be applied against future Canadian
      taxable income. These non-capital loss carry- forwards expire through 2015.
      There is no assurance that the Company will realize the benefit of the
      net-capital loss carry-forwards.





Change
      in
      ownership provisions may limit the benefits from net operating losses and
      non-capital losses carried for both United States and Canadian tax purposes.
       The impact of any limitations that may be imposed have not been
      determined.





SFAS
      No.
      109 requires a valuation allowance to be recorded when it is more likely than
      not that some or all of the deferred tax assets will not be realized. At April
      2006 and 2005, valuation allowances for the full amount of the net deferred
      tax
      assets were established due to the uncertainties as to the amount of the taxable
      income that would be generated in future years.





Reconciliation
      of the difference between statutory tax rate and the effective income tax rate
      is as follows:





2006
            
            2005Statutory
                Canadian tax (benefit) rate
            
            
            (34.5
            )%
            
            (34.5
            )%United
                States (benefit) rate
            
            
            (34.0
            )%
            
            (34.0
            )%Valuation
                allowance
            
            
            68.5
            %
            
            68.5
            %Effective
                income tax rate
            
            
            0.0
            %
            
            0.0
            %





**9.
      Property and Equipment**





Property
                and equipment comprise:
            
            April
                30,2006
            
            2005Computer
                equipment and software
            
            $
            157,354
            
            $
            25,387Demonstration
                equipment
            
            
            2,635
            
            
            2,341Studio
                Equipment
            
            
            79,708
            
            
            -Office
                equipment
            
            
            5,215
            
            
            650244,912
            
            
            28,378Less
                accumulated depreciation
            
            
            86,277
            
            
            11,747$
            158,635
            
            $
            16,631




Depreciation
      expense at April 30, 2006 and April 30, 2005 was $70,649 and $4,995
      respectively.





F-10


**Infotec
      Business Systems, Inc. and Subsidiaries**


*(A
      Development Stage Company)*


*Notes
      to Consolidated Financial Statements*





**10.
      Due to Related Party**




Advances
      made by a director to the Company are non-interest bearing and have no fixed
      date for repayment.  The total amount advanced at April 30, 2006 and 2005
      was $145,337 and $18,500 respectively.








**11.
      Related Party Transactions**




During
      the years ended April 30, 2006 and 2005, the Company entered into transactions
      (recorded at exchange values) with related parties as follows:





(a)




Management
                Fees
            
            April
                30, 2006
            
            April
                30,2005Secretary
                Treasurer
            
            $
            10,000
            
            $
            8,149President
                of
                the Company
            
            
            94,280
            
            
            3,492Chief
                Technical Officer
            
            
            106,160
            
            
            -Chief
                Financial Officer
            
            
            10,500
            
            
            -Finance
                administrator
            
            
            -
            
            
            3,500$
            220,940
            
            $
            15,141





(b)Revenues
      include $0 and $1,676 received or receivable from companies with directors
      in
      common for the years ended April 30, 2006 and 2005 respectively.


(c)Accounts
      payable at April 30, 2006 and 2005, include the amount of $133,302 and $129,141
      respectively, due to a shareholder and former officer of the Company and to
      companies related to a stockholder and former officer of the
      Company.







**12.
      Capital Stock**





(a)
            On
                September 16, 2005, the Company completed a private placement of
                2,000,000
                (5,000,000 post-split) shares of common stock at a price of $0.125
                per
                share for cash proceeds of $250,000.(b)
            On
                September 30, 2005, the Company issued 5,000,000 (12,500,000 post-split)
                common shares in exchange for the business and assets of Stream Horizon
                Media at a price of $0.06 per share for a cash proceeds of
                $750,000(c)
            On
                September 30, 2005 the Company issued 1,100,000 (2,750,000 post-split)
                common shares in exchange for the prior development and assets of
                ebahn
                Television Network Corp., for an aggregated consideration of
                $165,000.(d)
            On
                October 18, 2005 the Company effected a forward split of its capital
                stock
                on a 2.5:1 basis so that the 450,000,000 shares authorized (300,000,000
                common shares and 150,000,000 preferred shares) and 48,600,000 shares
                of
                common stock issued, were increased to 1,125,000,000 shares authorized
                (750,000,000 common shares and 375,000,000 preferred shares) and
                121,500,000 shares of common stock issued. Par value of the preferred
                and
                common stock remained unchanged at $0.001. All figures in these financial
                statements, including comparative information have been updated to
                give
                effect to the forward 2.5:1 split.


F-11


**ITEM 8. CHANGES IN AND
      DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
      DISCLOSURE.**





None.





**ITEM 8A. CONTROLS AND
      PROCEDURES.**





Our
      Chief
      Executive Officer and VP of Finance (collectively, the "Certifying Officers")
      are responsible for establishing and maintaining disclosure controls and
      procedures for us. Based upon such officers' evaluation of these controls and
      procedures as of a date within 90 days of the filing of this annual report,
      and
      subject to the limitations noted hereinafter, the Certifying Officers have
      concluded that our disclosure controls and procedures are effective to ensure
      that information required to be disclosed by us in this annual report is
      accumulated and communicated to management, including our principal executive
      officers as appropriate, to allow timely decisions regarding required
      disclosure.





The Certifying Officers have also indicated
      that there were no significant changes in our internal controls or other factors
      that could significantly affect such controls subsequent to the date of their
      evaluation, and there were no corrective actions with regard to significant
      deficiencies and material weaknesses.





Our management, including each of the Certifying
      Officers, does not expect that our disclosure controls or our internal controls
      will prevent all error and fraud.  A control system, no matter how well
      conceived and operated, can provide only reasonable, not absolute, assurance
      that the objectives of the control system are met.  In addition, the design
      of a control system must reflect the fact that there are resource constraints,
      and the benefits of controls must be considered relative to their costs.
 Because of the inherent limitations in all control systems, no evaluation
      of controls can provide absolute assurance that all control issues and instances
      of fraud, if any, within a company have been detected.  These inherent
      limitations include the realities that judgments in decision-making can be
      faulty, and that breakdowns can occur because of simple error or mistake.
 Additionally, controls can be circumvented by the individual acts of some
      persons, by collusion of two or more people or by management override of the
      control.





The
      design of any systems of controls also is based in part upon certain assumptions
      about the likelihood of future events, and there can be no assurance that any
      design will succeed in achieving its stated goals under all potential future
      conditions.  Over time, control may become inad-equate because of changes
      in conditions, or the degree of compliance with the policies or procedures
      may
      deteriorate.  Because of these inherent limitations in a cost-effective
      control system, misstatements due to error or fraud may occur and not be
      detected.





**ITEM 8B. OTHER
      INFORMATION.**





None.





15





**PART
      III**





**ITEM 9. DIRECTORS, EXECUTIVE
      OFFICERS, PROMOTERS AND CONTROL PER-SONS; COMPLIANCE WITH SECTION 16(a) OF
      THE
      EXCHANGE ACT.**





The
      following table sets forth the names, positions and the ages of our directors
      and executive officers.  Directors are elected at our annual meeting of
      stockholders and serve for a one year term or until removed from office in
      accordance with our bylaws or their successors are elected and qualify.
 Officers are appointed by the board of directors and their terms of office
      are, except to the extent gov-erned by employment contract, at the direction
      of
      the board of directors.  Directors do not currently receive any
      compensation for their services in acting as directors.





Director
            
            Name
            
            Age
            
            Position
            
            SinceArthur
                Griffiths
            
            
            49
            
            
            Chief
                Executive Officer President
                and Director
            
            
            2006Carol
                Shaw
            
            
            41
            
            
            Secretary,
                Treasurer and Director
            
            
            2004





Arthur
      Griffiths served as a director and as our President, Chief Executive Officer
      since February 10, 2006 Arthur
      Griffiths has an extensive background in broadcasting, having served as Director
      of Western International Communications (WIC) from 1990 through 1995. WIC was
      Canada's largest broadcaster prior to its eventual sale in 1999. Arthur owned
      and operated the National Hockey League's Vancouver Canucks for a number of
      years, while spearheading the successful development of General Motors Place
      in
      1994. In 1995, GM Place opened its doors to the public as the first privately
      financed arena in Canada in over 60 years, becoming the home of the Canucks
      and
      the NBA's newly created Vancouver Grizzlies franchise. By 1998, a group led
      by
      Arthur developed the 2010 Olympic Bid proposal, including venue development
      designs that eventually won Vancouver and Whistler's right to compete as
      Canada's national candidate for the 2010 Olympic Winter Games. In achieving
      this
      goal, the Bid Team was able to successfully prove to the Canadian Olympic
      Association that Vancouver and Whistler could develop the appropriate venues
      for
      such a vast undertaking. Concurrently, Arthur worked for the Rapid Transit
      Project Office, serving as Chair of Public Consultation and Chief Negotiator
      in
      the development of the new Millennium Skytrain Line. His primary
      responsibilities on the project were to meet and negotiate with municipalities
      and vehicle manufacturers; attend public forums to hear the concerns of the
      public and environmental groups and facilitate the formation of station
      development and design. Throughout his business career, Arthur has excelled
      in a
      variety of development projects requiring use of his experience and personal
      relationships relating to environmental and aboriginal issues. For the last
      five
      years he has developed real estate projects in Vancouver and Victoria and hosted
      a radio program focused on the business of sport. A truly valuable asset to
      the
      company, Arthur now devotes his efforts to Infotec on a full-time
      basis.





Carol Shaw, served as a director and as our
      President, Chief Executive Officer from November 11, 2004 to March 31, 2006.
      She
      served as a director and as our Secretary and Treasurer since April 1, 2006
       Ms. Shaw was a cofounder of Galaxy Networks Inc. Ms. Shaw has an extensive
      and successful financial management history, with a background on Tax and small
      business account-ing.  Ms. Shaw has managed the financial operations of a
      real estate company, a local long distance carrier and several technology
      companies.  Ms. Shaw has extensive training in marketing and has produced
      marketing material including comprehensive training manuals, brochures, and
      advertising materials.  Ms. Shaw has also designed and implemented a long
      distance billing and accounting soft-ware package, allowing automated invoicing,
      statement and account management and has been involved in the coordination
      of
      network deployment, and system resource management for several Internet
      companies including Galaxy Networks Inc.





16





Audit
      Committee. The
      board of directors has not yet established an audit committee, and the functions
      of the audit committee are currently performed by the entire board of directors.
      We are under no legal obligation to establish an audit committee and have
      elected not to do so at this time so as to avoid the time and expense of
      identifying independent directors willing to serve on the audit committee and
      obtaining directors and officers’ liability insurance.  We may establish an
      audit committee in the future if the board determines it to be advisable or
      we
      are otherwise required to do so by applicable law, rule or
      regulation.





Board of Directors Independence. Our
      board of directors consists of two members.  One of our directors is
      considered "independent" within the meaning of definitions established by the
      Securities and Exchange Commission or any self-regulatory organization.  We
      are not currently subject to any law, rule or regulation requiring that all
      or
      any portion of our board of directors include "independent"
      directors.





Audit
      Committee Financial Expert. We
      do not yet have an audit committee and, therefore, we have no "audit committee
      financial expert" within the meaning of Item 401(e) of Regulation S-B.  In
      general, an "audit committee financial expert", is an individual member of
      an
      audit committee who (a) understands generally accepted accounting principals
      and
      financial statements, (b) is able to assess the general application of such
      principals in connection with accounting for estimates, accruals and reserves,
      (c) has experience preparing, auditing, analyzing or evaluating financial
      statements compa-rable to the breadth and complexity of the company’s financial
      Statements, (d) understands internal controls over financial reporting and
      (e)
      understands audit committee functions.





Code
      of Ethics. We
      have not yet adopted a Code of Ethics applicable to our Chief Executive Officer,
      principal financial and accounting officers and persons performing similar
      functions.  A Code of Ethics, is a written standard designed to deter
      wrongdoing and to promote (a) honest and ethical conduct, (b) full, fair,
      accurate, timely and understandable disclosure in regulatory filings and public
      statements, (c) compliance with applicable laws, rules and regulations, (d)
      the
      prompt reporting of violations of the Code, and (e) accountability for adherence
      to the Code.  We have not yet adopted a Code of Ethics, and while we are
      not under any legal obligation to do so, we expect to adopt a Code of Ethics
      soon.  If and to the extent we adopt a Code of Ethics, we will file a copy
      of the Code of Ethics with the Securities and Exchange Commission, and will
      provide a copy, without charge, to any person desiring a copy of the Code of
      Ethics, by written request to the Company at its principal offices.  We
      currently maintain a corporate web site at www.infotecbusinesssystems.com .





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





Not
      Applicable.





**ITEM
      10. EXECUTIVE COMPENSATION.**





Summary
      Compensation Table





The
      following table sets forth information relating to all compensation awarded
      to,
      earned by or paid by us during the period from December 13, 2002 (inception)
      through April 30, 2006 to: (a) all individuals, serving as our Chief Executive
      Officer in the fiscal year ended April 30, 2006; and (b) each of our executive
      officers who earned more than $100,000 during the fiscal year ended April 30,
      2006:





17





Other
      Securities Annual Underlying All


Name
                and
            
            Fiscal
            
            
            
            
            
            Compen-
            
            Options/LTIP
            
            OtherPrincipal
                Position
            
            Year
            
            Salary
            
            Bonus
            
            sation
            
            SARs
                (#)
            
            Payouts
            
            CompensationCarol
                Shaw
            
            
            2006
            
            $
            58,551
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -President,
                CEO
            
            
            2005
            
            $
            3,492
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -Arthur
                Griffiths
            
            
            2006
            
            $
            29,500
            
            
            -
            
            $
            6,229
            
            
            -
            
            
            -
            
            
            -President,
                CEO
            
            
            2005
            
            $
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -Ed
                Clunn
            
            
            2006
            
            $
            106,160
            
            
            
            
            
            -
            
            
            -
            
            
            -
            
            
            -CTO
            
            
            2005
            
            $
            -
            
            
            
            
            
            -
            
            
            -
            
            
            -
            
            
            -Carol
                Shaw
            
            
            2006
            
            $
            10,000
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -Secretary/Admin
            
            
            2005
            
            $
            3,500
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -Bob
                Danvers
            
            
            2006
            
            $
            10,500
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -CFO/Secretary
            
            
            2005
            
            $
            8,149
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -








Option/SAR
      Grants


We
      did
      not grant any stock options to the executive officers during our most recent
      fiscal year
      ended April 30, 2006.





Compensation
      of Directors


There
      are
      no standard arrangements pursuant to which directors are compensated for any
      ser-vices provided
      as director.  No additional amounts are payable to directors for committee
      participation or special
      assignments performed for and on our behalf through to April 30,
      2006.





**ITEM
      11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MAN-AGEMENT AND RELATED
      STOCKHOLDER MATTERS.**





The
      following table sets forth certain information regarding our common stock
      beneficially owned as of June 30, 2006 by:





(i)
            each
                stockholder known by us to be the beneficial owner of five (5%) percent
                or
                more of our outstanding common stock;(ii)
            each
                of our directors; and(iii)
            all
                executive officers and directors as a
                group.





As
      at
      June 30, 2006, there were 121,500,000 shares of our common stock issued and
      outstanding.





Name
                and Address of
            
            Amount
                and Nature ofBeneficial
                Owner (1)
            
            Beneficial
                Owner  (2)
            
            Percentof ClassCarol
                Shaw (3)
            
            
            8,125,000
            
            
            6.69
            %Edward
                Clunn (4)
            
            
            36,660,000
            
            
            30.17
            %Robert
                Danvers
            
            
            11,720,000
            
            
            9.60
            %Bram
                Solloway
            
            
            10,503,125
            
            
            8.60
            %





All
                Executive Officersand
                Directors as a group (2 persons)
            
            
            44,725,000
            
            
            36.86
            %


_____________________





18





(1)
      Unless otherwise indicated the address of each of the listed beneficial owners
      identified is #150 - 1152 Mainland Street, Vancouver, BC V6B 4X2.


(2)
      Under
      securities law, a person is considered a "beneficial owner" of a security if
      that person has or shares power to vote or direct the voting of such security
      or
      the power to dispose of such security.  A person is also considered to be a
      beneficial owner of any securities of which the person has a right to acquire
      beneficial ownership within 60 days.


(3)
      Includes 36,660,000 common shares held in the name of Edward Clunn.  Carol
      Shaw is the spouse of Edward Clunn.  Each disclaims beneficial ownership of
      the shares beneficially owned by the other.


(4)
      Includes 8,125,000 common shares held in the name of Carol Shaw.  Edward
      Clunn is the spouse of Carol Shaw.  Each disclaims beneficial ownership of
      the shares beneficially owned by the other.





Securities
      Authorized for Issuance Under Equity Compensation Plans





We
      do not
      have any equity compensation plans nor are there any securities authorized
      for
      issu-ance under an equity compensation plan or program.





**ITEM
      12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.**





Except
      as
      set forth below, in the last two fiscal years ended April 30, 2006, there have
      been no material transactions, series of similar transactions, currently
      proposed transactions, or series of simi-lar transactions, to which we are
      or
      will be a party, in which the amount involved exceeded $60,000 and in which
      any
      of our directors or executive officers, any security holder who is known by
      us
      to own of record or beneficially more than five percent of our common stock,
      any
      promoter, or any member of the immediate family of any of the foregoing persons,
      had a material interest.





During
      the period from May 1, 2003, through April 30, 2005:





Effective
      May 2003, the company approved a fee of $5,000 per month to Danby Financial
      Management Corp., a company controlled by our President at that time, for
      services rendered by Mr. Danvers.





In
      May
      2003 we entered into a licensing agreement with CTEC Security Solutions Inc.,
      a
      com-pany with a director in common, to enable us to incorporate public key
      infrastructure security into our online systems.  In September 2003, the
      license agreement was amended to expand our selling territory.





On
      November 11, 2004, Infotec Business Systems, Inc. and Galaxy Networks Inc.,
      a
      British Columbia corporation, and the stockholders of Galaxy entered into a
      Stock Purchase Agreement whereby we agreed to acquire 100 common shares of
      Galaxy representing 100% of the issued shares of Galaxy, in exchange for the
      issuance of 20,000,000 shares of our restricted common stock.





At
      this
      time we have not formulated any corporate policies for entering into
      transactions with affiliated parties.





19





As
      disclosed heretofore, our president and most but not all the members are
      employed by us on a full-time basis.  If a specific business opportunity
      becomes available, such part time employees may face a conflict in selecting
      between our business and their other business interests.  We have a policy
      for the resolution of such conflicts.  We currently have agreements with
      members of our management team.





**ITEM
      13. EXHIBITS.**





**A.
      Exhibits**





**Number**
            
            **Description
                of exhibit**3.1
            
            Articles
                of Incorporation (1)3.1a
            
            Form
                of Certificate Change (2)3.2
            
            Bylaws
                (1)10.1
            
            Stock
                Purchase Agreement between Infotec Business Systems, Inc. and Galaxy
                Networks Inc., of November 11, 2004 (3)21
            
            Subsidiaries
                of the Issuer31.1
            
            Certification
                of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
                Act of 200231.2
            
            Certification
                of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
                Act of 200232
            
            Certification
                of Chief Executive Officer and Chief Financial Officer pursuant to
                Section
                906 of the Sarbanes-Oxley Act of
                2002


_______________________




(1)Incorporated
      by reference to the registration statement on Form SB-2 file number 333-90618,
      as amended, as declared effective by the Securities and Exchange Commission
      on
      November 5, 2002.





(2)Incorporated
      by reference to the Form 8-K filed with the Securities and Exchange Commission
      on March 7, 2003.





(3)Incorporated
      by reference to the Form 8-K filed with the Securities and Exchange Commission
      on January 26, 2005 as Item 10.1.





20





**ITEM
      14. PRINCIPAL ACCOUNTING FEES AND SERVICES.**





During
      the fiscal years ended April 2006 and 2005, the Company incurred the following
      fees for professional services rendered by the principal
      accountant:





2006
            
            2005Fees
                for audit services
            
            $
            34,460
            
            $
            27,080Fees
                for audit related services
            
            
            -
            
            
            -Tax
                fees
            
            
            -
            
            
            -All
                other fees
            
            
            -
            
            
            -





The
      board
      of directors pre-approves all audit and non-audit services to be performed
      by
      the company’s independent auditors.





21





**SIGNATURES**





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








**Infotec
      Business Systems, Inc.**


(Registrant)








By: /s/
      Arthur
      Griffiths


Arthur
      Griffiths


President, Chief Executive Officer, Director








Date:
        November
        30, 2006





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







Signature
              
              Title
              
              Date/s/
                  Arthur Griffiths
              
              President,
                  Director, CEO,
              
              November
                  30, 2006Arthur
                  Griffiths
              
              Principal
                  Executive, Officer/s/
                  Carol Shaw
              
              Secretary,
                  Treasurer, Director
              
              November
                    30, 2006Carol
                  Shaw
              
              Principal
                  Finance and Accounting Officer





22