**SECURITIES
      AND EXCHANGE COMMISSION**


**WASHINGTON,
      D.C. 20549**




_________________________________________




**FORM
      10-KSB**


_________________________________________




**ANNUAL
      REPORT UNDER SECTION 13 OR 15(D) OF THE**


**SECURITIES
      EXCHANGE ACT OF 1934**




**ANNUAL
      REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES**


**EXCHANGE
      ACT OF 1934**




For
      Fiscal Year Ended




**December
      31, 2006**




Commission
      File #333-105778




**MORTGAGEBROKERS.COM
      HOLDINGS, INC** .


(Exact
      name of registrant as specified in its charter)




**Delaware**


(State
      or
      other jurisdiction of incorporation or organization)




**05-0554486**


(IRS
      Employer Identification Number)




**11-260
      Edgeley Boulevard, City of Vaughan, Ontario, L4C 3Y4**


(Address
      of principal executive offices )(Zip Code)




**877-410-4848**


(Registrant’s
      telephone no., including area code)




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




Title
      of
      each class Name of each exchange on which registered




_____________________________________________________________




Securities
      registered pursuant to Section 12(g) of the Act:




**Common
      Stock, $0.0001 par value**


(Title
      of
      class)




(Former
      name, former address and former fiscal year,


if
      changed since last report)












Indicate
      by check mark whether the registrant (1) has filed all reports required to
      be
      filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
      the
      preceding 12 months (or for such shorter period that the registrant was required
      to file such reports), and (2) has been subject to such filing requirements
      for
      the past 90 days.




Yes o  No o




Indicate
      by check mark whether the registrant is a shell company as defined in Rule
      12b-2
      of the Exchange Act.


Yes o  No o




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




Yes o  No o


Revenues
      for year ended December 31, 2006: $ 4,023,281.




Aggregate
        market value of the voting common stock held by non-affiliates of the registrant
        as of April 17, 2007, is: $10,876,000




Number
      of
      shares of the registrant’s common stock outstanding as of December 31, 2006 is: 36,088,470




Transfer
        Agent as of April 17, 2007:


Securities
                Transfer Corporation2591
                Dallas Parkway, Suite 102Frisco,
                TX, 75034












**PART
      I**




**ITEM
      1. DESCRIPTION OF BUSINESS**




**General**




We
        were
        incorporated under the laws of Delaware on February 6, 2003 as Magna Data,
        Inc.
        and initially established for the purposes of providing consulting and technical
        support to internet service providers to develop e-commerce market intelligence
        services. On
        January 31, 2005, the Company’s current majority shareholder, Alex Haditaghi,
        purchased 1,510,000 shares from three shareholders of Magna Data Inc. for
        cash
        consideration ($692, 813) in an arms length transaction (See Form 8-K filed
        by
        the Company on February 7, 2005). This share purchase represented approximately
        78% of Magna Data’s common shares outstanding at the time of the transaction,
        based on the Company’s December, 2004, Form 10-KSB. In
        February 2005, we filed articles of amendments with the State of Delaware
        changing the name of our company to MortgageBrokers.com Holdings, Inc. (the
        “Company”). On March 21, 2005, we entered into a Stock Purchase Agreement and
        Share Exchange with Mortgagebrokers.com, Inc. an Ontario, Canada, corporation.
        Pursuant to this agreement, Mortgagebrokers.com, Inc. became our subsidiary
        for
        operating as a mortgage broker in Ontario. An additional Canadian federally
        incorporated operating company was established in October, 2005,
        MortgageBrokers.com Financial Group of Companies Inc., as being owned by
        MortgageBrokers.com Holdings, Inc. under which we are expanding our mortgage
        broker licensure and operations across Canada. Now, through our subsidiaries,
        we
        will act as a mortgage brokerage firm serving the lending needs of real estate
        professionals, builders, and individual home buyers across, initially Canada,
        and, as we add and acquire additional subsidiaries, into the United States
        and
        Europe leveraging the Company’s unique business model. We have access to a full
        range of mortgage sources from a wide range of a country’s banks, trusts and
        private lenders and we are dedicated to finding the right loan, with the
        best
        rates, terms and costs, to meet each client’s unique needs. Exhibit 3.2 here-in
        provides a description of the Company subsidiaries in accordance to Item
        601
        (b)(21) of Regulation S-B .




We
      are a
      mortgage origination company that generates revenue by placing mortgages off
      balance sheet with third party lenders who in return, pay the company a
      combination of finder’s fees and volume bonus whose aggregate sum fee typically
      ranges between 75 to 150 basis points (0.75 to 1.5%) of the total mortgage
      volume. We currently earn nominal additional revenues through the referral
      and
      placement of creditor insurance with third party insurance
      providers.




We
      are
      the first publicly traded independent (non-bank owned) mortgage brokerage
      operating in Canada with a universal domain name that provides expansion
      opportunity to markets outside Canada and the USA. We have deconstructed the
      existing origination business models and created a sustainable model that
      addresses the long standing mortgage broker industry issues of ownership, career
      exit strategy and agent retention. At the same time we have created new
      opportunities for referral source strategic alliance partners to receive revenue
      and Company equity participation through customized long-term market access
      and
      referral agreements.




As
      we
      expand and operationalize our revolutionary sales model, we are engaged in
      diversifying our product offering and creating additional revenue streams
      through mortgage banking (origination & servicing), insurance and ancillary
      credit products centered around mortgage origination.




**OUR
      STRATEGY**




MortgageBrokers.com
      is a compelling and recognizable mortgage brokerage brand serving the mortgage
      broker and financial services industry. The company is creating strategic
      partnerships with its market supply chain to promote its compelling and
      sustainable value proposition centered on revenue sharing and equity
      participation in a publicly traded company.




1


MortgageBrokers.com
      is executing a multi channel sales strategy:




1.
            within
                the traditional mortgage broker channel, our strategy is based on
                a vision
                of consolidating small and medium sized enterprise (SME) brokerages
                into a
                scalable operating national network of branch retail offices that
                can
                better compete in the industry under one recognizable brand while
                eliminating long-standing industry issues of agent retention, equity
                ownership and career exit strategy;
                while,





2.
            within
                traditional financial planning and real estate channels, our strategy
                is
                to re-engineer the lead referral model with dominant national market
                share
                companies as strategic partners. These strategic partnerships will
                create
                new and sustainable value not available in the current market for
                strategic alliance partners. This value includes new revenue sources,
                ownership in a publicly traded company whose value is leveraged with
                the
                mortgage origination volume such dominant market partners can provide,
                tools for agent attraction, agent retention, agent wealth building
                and
                minimization of brand
                fractionation.




Our
        developing proprietary technology platform ***eXimius*** TM
will
        allow the company to reduce company operating costs, improve communication
        to
        mortgage stakeholders, provide the basis for a back-end shared services
        technology infrastructure and facilitate knowledge transfer amongst our loan
        originators. In 2005, the Company initiated the development of a prototype
        proprietary back office software technology branded **** ***eXimius*** .
        The
        prototype software was being developed to test the viability for automation
        in
        the Company’s back office administrative areas of mortgage underwriting,
        commission management, and regulatory compliance. The prototype software
        was not
        licensed from a third party, but 100% internally developed. The company does
        not
        intend to license for use the developed prototype software to third parties.
        The
        company is presently preparing for the next stage in development of this
        technology which is expected to commence in 2007 which will likely require
        a
        complete redevelopment of the previously developed prototype.


**Strategy
      for Growth**




Our
      strategy for growth involves creating a multi-sales-channel mortgage origination
      company with the vision of diversifying it’s product offerings and expanding
      it’s presence to other markets across Canada and to the United States and Europe
      in the near future. Based on a vision of “security through ownership” for our
      mortgage originators and strategic partners, our growth strategy is to increase
      our mortgage loan origination volume through expanding our presence in our
      existing markets and by entering new markets. We are executing this strategy
      through the recruitment and licensure of select mortgage sales agents and agent
      teams and executing relationships with market supply chain
      partners:





**•**
              *Expansion
                  of our National Sales Agency.*We
                  intend to continue to recruit highly-qualified loan originators
                  and refine
                  our operations, including our compensation arrangements, service
                  levels,
                  back end support and use of technology. Through this growth we
                  intend to
                  expand our retail branch network into new geographic areas and
                  to further
                  penetrate existing markets.**•**
              *Redefine
                  Traditional Origination Supply Chain Partnerships.*We
                  recognize that there are unsustainable and non-compelling partnerships
                  with market supply chain partners in the Real Estate, Financial
                  Planning
                  & Insurance industries. Through leveraging opportunities for revenue
                  sharing and equity participation in our public company, we will
                  seek out
                  strategic partnerships in the above mentioned
                  industries.






2




**•**
              *Diversify
                  Our Business.*In
                  an effort to hedge interest rate fluctuations and seasonal fluctuations
                  to
                  mortgage origination volumes, the company believes that becoming
                  more
                  diversified in its product offering will provide us with enhanced
                  revenues
                  and reduced risks associated with the cyclical nature of our industry.
                  Diversification can be accomplished through mortgage lending and
                  servicing, creditor insurance and other products centered around
                  mortgage
                  origination.




In
      executing our business strategy, we focus on the following
      elements:




**•**
            *Leveraging
                Technology to Maximize Efficiency.*We
                have prototyped a proprietary technology called*eXimius*TM
                that will help to reduce operating costs, improve communication to
                mortgage stakeholders, provide the basis for back-end support
                infrastructure and facilitate knowledge transfer among our Managing
                Partners and loan originators.**•**
            *Promoting
                a Sales & Recruitment Culture.*To
                maintain a culture of continuous growth and recruitment, we have
                implemented PATH (Prosperity Accelerated Through Hiring), a program
                whereby brokers are encouraged to recruit mortgage agents, earning
                them
                additional equity ownership in MortgageBrokers.com. In addition,
                a
                strategic advisory board will be created for the purpose of promulgating
                best practices and maximizing channel sales.**•**
            *Resolve
                Long Standing Industry Issues.*A
                key aspect to our business strategy is the resolution of long standing
                industry issues of agent retention, ownership and creating a career
                exit
                strategy. These issues are addressed through the company’s vision of
                ‘security through ownership’, whereby brokers and staff benefit from
                equity ownership through achieving performance
                benchmarks.**•**
            *Transparent
                Best in Class Customer Experience*.
                Promote an environment whereby we eliminate the traditional incentive
                structures to charge customers higher rates that the majority of
                the
                market’s business models are indelibly tied to and offering a life-cycle
                based diversified product offering centered on mortgage
                financing.




**Mortgage
      Broker Channel**




The
      MortgageBrokers.com model, although not for everyone, successfully reverses
      the
      trend towards paying higher commissions by offering brokers and agents better
      tools to build value in their businesses and resolving the long standing
      industry issues of agent retention, equity participation and career exit
      strategy.




Mortgage
      Brokerages have long suffered from the inability to retain their top loan
      originators, typically losing them to competing brokerages that offer increased
      commissions with very little sustainable value. In addition, in this
      consolidating environment, many sales agents have seen the companies they work
      with, sold to large financial institutions or brokerages, with nothing to show
      from the transaction when it is they who are responsible for creating much
      of
      the value associated with the transaction. Therefore, there is pent up demand
      within the industry for a mortgage brokerage model that will address these
      long
      standing issues of agent retention and equity ownership. The equity
      participation at our company, the first of its kind in the industry, gives
      all
      mortgage sales agents and developing teamed agents an earned on-going equity
      stake in the company, thereby minimizing issues of agent retention and career
      exit strategy.




A
      component part of the Company's sales operations entails establishing a
      sustainable, well trained and performance based national agency sales force
      to
      service the borrowing and refinancing needs of individual
      homebuyers.






3




The
      Company’s Canadian subsidiary agency sales force consists of recruited
      independent contractors operating regionally under the Company's licensure.
      Generally, in the MortgageBrokers.com model, our licensed agents earn at least
      85% of received commission fees. In addition to earned commission fees, the
      Company provides an opportunity for our Canadian subsidiary's national agency
      sales force to earn stock warrants in the Company based on annual sales volumes
      over a period of time (warrant-based compensation). In Summary:




·
            Recruited
                mortgage sales agents execute an exclusive agreement with a subsidiary
                of
                MortgageBrokers.com as a third party sales subcontractor. The mortgage
                agents agree to operate under the terms of the sales agreement and
                the
                mortgage broker licensure and brand of the Company and allow the
                Company
                to take typically 15% of the commission fees payable to the mortgage
                agent
                from a mortgage lender in exchange for payroll, revenue management
                (volume
                pooling), licensure, compliance, and marketing
                services.




·
            No
                money is paid by the Company for purchase of any asset of the mortgage
                agent or their business including the agent’s book of business. The
                company does not take an equity ownership position in the independent
                business of the individual mortgage agent or mortgage agent
                team.




·
            Generally,
                the size of potential warrant issues to a contracted sales agent
                or sales
                agent team is modeled upon a discounted cash flow valuation of the
                margin
                contribution to the Company’s bottom line represented by the mortgage
                agent’s mortgage average annual origination sales volume over a forward
                period and taking into account foreign exchange and the Company’s cost
                structure.An
                agent or agent team are eligible to receive multiple warrant issues
                based
                on performance and pursuant to the execution of a warrant
                agreement.




·
            Presently,
                under existing formulae and by way of example to illustrate the warrant
                model for mortgage agents, a mortgage agent team responsible for
                originating $100 million in average annual mortgage volume over a
                five
                year period would be eligible to
                receive:




·
            USD
                $83,000 dollars worth of cashless (fully earned) stock warrants (“Series I
                Mortgage Agent Warrants”), the warrant pricing being the greater of the 20
                day average closing price preceding the warrant series earnings period
                or
                USD $1.00. If the mortgage agent team’s five year average annual mortgage
                volume is less or more than the afore-mentioned $100 million, the
                number
                of Series I Mortgage Agent Warrants granted to the agent or agent
                team is
                adjusted proportionately. The mortgage agents are not eligible to
                earn
                Series I Mortgage Agent Warrants until a minimum 5 year term sales
                period
                is completed in full, following execution of an agency sales contract
                with
                the Company. It is expected that Series I Mortgage Agent Warrants
                will be
                granted within 6 months following the five year anniversary date
                of the
                agent’s executed license agreement. The Series I Mortgage Agent Warrants
                have no additional vestment period associated with them;
                and,




·
            Additionally,
                the mortgage agent or agent team would be eligible to earn USD $16,513
                dollars worth of cashless (fully earned) stock warrants each year
                the
                warrant pricing being the greater of the 20 day average closing price
                preceding the warrant series earnings period or USD $1.00, subject
                to the
                following vestment periods:




a.
            Stock
                warrants earned each year in the first five year period following
                execution of the agent’s license agreement with the Company, have a three
                year vestment period following the five year initial earnings period
                (Series II Mortgage Agent Warrants).




4


In
      summary, Series II Mortgage Agent Warrants earned in the first five years based
      on the agent’s annual origination sales volume, are granted and exercisable
      following the eight year anniversary date of the agent’s executed license
      agreement. If the mortgage agent team’s annual mortgage origination sales volume
      is less or more than the afore-mentioned $100 million, the number of Series
      II
      Mortgage Agent Warrants granted to the agent or agent team is adjusted
      proportionately.




b.
            Currently,
                stock warrants earned in year’s 6 through 8 following execution of the
                agent’s license agreement with the Company, are vested till the tenth year
                anniversary of the agent’s executed license agreement (Series III Mortgage
                Agent Warrants). In summary, Series III Mortgage Agent Warrants earned
                in
                the year’s six through eight based on the agent’s annual origination sales
                volume, are granted and exercisable following the tenth year anniversary
                date of the agent’s executed license agreement. If the mortgage agent
                team’s annual mortgage origination sales volume is less or more than the
                afore-mentioned $100 million, the number of Series III Mortgage Agent
                Warrants granted to the agent or agent team is adjusted
                proportionately.




c.
            Continued
                warrant series issues earned for subsequent three year periods following
                the Series III Mortgage Agents Warrant earnings period are similarly
                structured with two year vestments following the three year earning
                period.




d.
            Warrant
                pricing for Series II and all following issues of Mortgage Agent
                Warrants
                is established as the twenty (‘20’) day average closing price of the stock
                preceding the commencement of the Series earning period or at the
                minimum
                value of USD $1.00, which ever is greater. For example, for Series
                II
                Mortgage Agent Warrants, the price is established as the greater
                of the
                twenty (‘20’) day average closing price preceding the fifth anniversary
                date of the agents license agreement or USD
                $1.00.




·
            The
                mortgage agents are not eligible to earn Mortgage Agent Warrants
                for any
                incomplete earnings period. It is expected that all warrants will
                be
                granted within 6 months following the relative warrant series earning
                period vestment period.




·
            The
                expected first Company stock warrants associated with this program
                may be
                executed by contracted sales mortgage agents in the fall of 2008
                which
                might be registered and monetized in 2009 at the earliest. It is
                expected
                that stock warrants for as many as 5,000,000 shares may be executed
                with
                the Canadian agency sales force between 2010 and
                2015.




·
            Alex
                Haditaghi, the Company Chairman and Chief Executive Officer, has
                agreed
                that commencing on January 31, 2006, the first 4,000,000 shares to
                be
                exercised from warrant agreements through this program by the national
                sales agency network will be provided out of Mr. Haditaghi's personal
                holdings and be non-dilutionary on the Company's capital structure.
                Under
                this agreement Alex Haditaghi will cancel 4,000,000 of his personal
                shares
                upon the Company issuing 4,000,000 shares to the Company’s agency sales
                force.




While
        the
        accrual and issue of warrant-based compensation represents an immediate charge
        to the Company’s bottom line at this early stage in it’s growth, the Company
        believes that the benefits of leveraging the Company’s capital structure to
        rapidly build a quality ‘book of business’ far outweigh the short term expense
        as we build a long term, sustainably profitable partnership with our sales
        force
        whose interests are aligned with those of shareholders.


The
      Company may modify this initiative from time to time in the future for new
      agents as may be determined from time to time by the Company’s Board for the
      management of the company’s capital structure, changing market conditions,
      changes in the company’s cost structure and changes in the national agency sales
      force margin contribution to the Company. It is identified in the sales agency
      agreement that the warrant
      minimum exercise price will be established at USD $1.00. The
      warrant agreement is yet to be finalized for this program.




5


**Real
      Estate Channel**




Real
      estate sales associates are the primary source of mortgage referrals and they
      are typically the first to make contact with the consumer in the buying process.
      In fact, according to a CMHC Consumer survey, real estate sales associates
      were
      ranked as the individual most relied on to provide mortgage financing advise,
      well above mortgage brokers or banks. Despite this reality, the mortgage broker
      and lending industries have failed to offer a sustainable and compelling value
      proposition to the real estate industry capitalizing on the over 480,000 real
      estate transactions that are expected to take place on the Multiple Listing
      Service (MLS®) in 2005. Most existing mortgage referral partnership models with
      real estate firms have centered on revenue sharing which is unsustainable while
      other real estate firms dissatisfied with existing models have resorted to
      creating their own mortgage firms.




MortgageBrokers.com,
      through it’s subsidiaries, is establishing long term market access agreements
      with market dominant regional and national real estate companies. Through
      customized revenue sharing programs, the Company issues referral commissions
      to
      the real estate companies for those referrals that lead to funded mortgages.
      Additionally, pursuant to long term market access agreements, the real estate
      company may additionally earn warrant-based compensation (Series IV
      W arrants).
      In general, pursuant to a long term licensing agreement the Company is committed
      to issuing to the real estate strategic alliance partner, at no cost, warrants
      for common stock of the Company based on referrals leading to funded mortgage
      origination volume. The typical real estate warrant-based compensation program
      issues warrants as follows based on current formulae:


Annual
                  Volume:
              defined
                  as the total funded mortgage origination volume from the real estate
                  lead
                  referral originated per 12 month period following the Effective
                  Date and
                  subsequent 12 month periods following the anniversary dates of
                  the
                  Effective Date;Number
                  of Warrants:
              USD
                  $3,000 US worth of warrants divided by the Strike Price per CDN
                  $10
                  million dollars in Annual Volume, adjusted on a pro rata basis,
                  no minimum
                  or maximum thresholds. The warrants are convertible in common shares
                  on a
                  1:1 basis.Earnings
                  Period:
              Series
                  IV warrants are earned in the first 3 years following the Effective
                  DateAdditional
                  Vestment:
              SERIES
                  IV warrants are fully vested on the 5th anniversary of the Effective
                  Date




While
        the
        accrual and issue of warrant-based compensation represents an immediate charge
        to the Company’s bottom line at this early stage in it’s growth, the Company
        believes that the benefits of leveraging the Company’s capital structure to
        rapidly build a long term quality origination sales referral pipeline far
        outweigh the short term expense as we build a long term, sustainably profitable
        partnership with our market partners whose interests are aligned with those
        of
        shareholders




To
      minimize internal costs, all mortgage referrals from this channel will be
      processed through our mobile mortgage specialists from the point of application
      to mortgage funding, with centralized administrative support. ***eXimiusTM*** will
      play an integral part in this channel by providing the platform to submit
      electronic applications and providing the tracking of mortgage referrals and
      revenues.




**Financial
      Planning and Insurance Channel**




Similarly
      to the real estate industry, the mortgage referral business models that exist
      in
      the Financial Planning and Insurance industries are centered on revenue sharing
      which makes these relationships vulnerable to the highest bidder and
      commoditizing the services offered by mortgage originators. The industry
      currently has some formal partnerships in place that provide a varying amount
      of
      revenue sharing while others dissatisfied with existing models have attempted
      to
      bring mortgage origination within it’s banner of services.




Agents
      have intimate relationships with a customer base that is often affluent and
      existing home-owners. Consequently this market supply chain partner is the
      direct source for mortgage refinancing and renewal transactions.




Despite
      these various models, we will, in addition to revenue sharing, offer supply
      chain partners the ability to participate in on-going equity participation
      based
      on mortgage origination.




6


We
      will
      also leverage technology to maximize efficiencies by processing mortgage
      applications through a centralized underwriting environment.




**Mortgage
      Banking Division**




Based
      on
      the market opportunities in Canada and market trends in the United States,
      it is
      important for the Company to evaluate and execute a plan to enter this market
      space. In the United States, many mortgage brokerages have evolved over time
      to
      become mortgage bankers primarily through warehouse lines of credit to lend
      in
      the sub-prime and Alt-A market. This trend is a natural vertical integration
      of
      these mortgage brokerages to take advantage of having access and control over
      the supply chain, better ability to assess credit risk due to their proximity
      to
      the customer, lower costs by avoiding frontline sales staff and branches and
      control over lending decisions.




Through
      our national network of independent branch locations and increased market
      penetration of mortgage origination through our multi-sales channel strategy,
      our goal is to originate and service sub-prime mortgages from our various
      distribution channels.




We
        have
        set aside the next 18 months to effectively assess and develop product
        offerings, risk criteria and investment partners to enter this market. It
        is
        also important over this period of time to generate mortgage origination
        market
        share for the company which will begin to serve as the pool of business in
        which
        volume and revenue will be generated.


**Competition**




Mortgage
      origination in Canada can be segmented into three broad categories and their
      relative market share:




**Origination
                Channel**
            **Market
                Share**Bank
                branch networks
            50%Bank
                mobile mortgage sales teams
            24%Mortgage
                brokers
            26%




Over
      the
      past decade, the relative share for the branch networks had decreased as
      consumer demand for accessibility and specialization intensify. The mobile
      sales
      teams of the major banks have generally succeeded by leveraging brand appeal
      and
      a captive customer base. In an effort to compete with mortgage brokers who
      offer
      varying credit quality mortgage solutions of numerous lenders, the bank mortgage
      sales forces have begun allowing their sales teams to offer other lender
      products outside their credit parameters.




Five
      large Canadian coast to coast to coast mortgage originators control
      approximately 50% of origination and lay claim to more than two-thirds of
      mortgage brokers. According to a report written by the Taddingstone Consulting
      Group, “it appears that brokerage houses are struggling to demonstrate value to
      many of their brokers, and it appears that the rate of remarkable consolidation
      may be slowing”. Typically the largest to the smallest mortgage brokerages and
      bank mortgage sales forces have failed to clearly differentiate
      themselves.




Mortgage
      brokerages have typically vied for each others agents and associated books
      of
      business by slicing their margins, Mortgage Intelligence (owned by GMAC) offers
      their Independent Consultants a minimum of 85% of gross revenues. In 2004,
      Mortgage Intelligence originated approximately seven billion dollars with gross
      revenues of $70MM, and net margins after commissions paid of less than 15%.
      Mortgage brokerages and mortgage sales forces fail to offer a compelling value
      proposition beyond commission splits, organized training and marketing
      support.




7


**Employees**




We
      have
      corporate offices in Manhattan, New York, USA and in Ontario, Canada with 16
      full-time staff and 192 mortgage consultants working out of 11 retail branch
      offices in Ontario, New Brunswick, Nova Scotia, Prince Edward Island,
      Newfoundland, Manitoba, Saskatchewan, Alberta and British Columbia.




**ITEM
      2. DESCRIPTION OF PROPERTY**




We
        presently maintain our corporate offices at 11-260 Edgeley Boulevard, City
        of
        Vaughan, Ontario, CANADA and 410 Park Avenue, 15 th Floor,
        New York, New York, USA. Our current contact information for our Ontario
        office
        is telephone number: (877) 410-4848 and fax number: (877) 410-4845. Our current
        contact information for our New York office is telephone number (917) 210-8994
        and fax number: 877-410-4845. Our internet website can be found under the
        domain
        name: www.mortgagebrokers.com .
  The
        Company sublets its Canadian corporate head office in the City of Vaughan,
        Canada, and is party to a 2 year lease which commenced on April 1, 2007 with
        an
        option to purchase the property.




The
        Company’s New York address is a virtual office located within a corporate office
        center that is paid for on a month to month basis. The company does not have
        a
        physical office space or long term lease obligation in New York, New York,
        USA.


The
      Company recently negotiated and executed a lease for its corporate office in
      Calgary, Alberta, Canada, and is party to a five (5) year lease commencing
      in
      May, 2007.




At
      the
      end of 2006, the Company's national sales agency network were operating 11
      retail office locations under the Company's brand and licensure. Through the
      Company's unique agency sales contract, the company supports our national sales
      agency in the building of regional teams and establishing regional retail sales
      offices. Under the terms of the Company agency contract, all lease obligations
      and associated costs for establishing such regional retail offices are the
      responsibility of the company’s independent subcontractor sales agents. The
      Company is not party to these regional lease obligation agreements




**ITEM
      3. LEGAL PROCEEDINGS**




In
        the
        normal course of our business, we may periodically become subject to various
        lawsuits. The following is a summary of current legal actions pending against
        us
        which may be considered material and contingent liabilities or liabilities
        to
        the Company as well as the outcomes of other former proceedings that the
        Company
        is party to that may have been initiated or discontinued in 2006.


1.
            The
                Company received a statement of claim from 1098704 Alberta Ltd for
                the
                amount of CDN $50,000. 1098704 Alberta Ltd was a reported investor
                into
                the business of a former licensed mortgage agent operating under
                Company
                licensure in Q4 2005 and Q1 2006. The claim was related to the
                reimbursement of an investment between the claimant and the Company's
                former mortgage agent subcontractor and the claimant was requesting
                that
                the Company repay the failed investment on behalf of the former
                independent mortgage agent subcontractor.. In the opinion of the
                Company
                and its legal counsel, the claim was without merit as the Company
                had no
                relationship, business or otherwise, with the claimant. The Company
                subsequently filed a statement of defense and a counter claim in
                the
                amount of CDN $1,000,000. It was agreed between the parties to file
                mutual
                discontinuances related to each party's claims and that mutual
                indemnification releases be executed. Discontinuance, Settlement
                and
                Release agreements were executed between the parties on November
                10,
                2006.




2.
            Trisan
                  Equitable Corporation ("TRISAN") commenced an action in October
                  2006 in
                  Ontario, Canada against several parties including MortgageBrokers.com
                  Holdings, Inc. The statement of claim is for an aggregate payment
                  of
                  approximately $1.3 MM plus applicable interest related to a financing
                  agreement. The Company plans to vigorously defend itself in this
                  claim and
                  has launched a counter suit in Ontario Superior Court against TRISAN
                  and
                  related parties in the amount of $4.8 MM. Legal counsel for the
                  Company at
                  this time estimate that this claim maybe a reasonably possible
                  contingent
                  liability for the Company of up to $520,000 plus applicable interest.
                  At
                  the present time, the Company and its legal counsel agree that
                  the outcome
                  of this proceeding cannot be reasonably determined at this
                  time.




8




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




None.




9


**PART
      II**











**ITEM
      5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
      MATTERS**




On
        March 13, 2007,
        there were 375 shareholders of record of our common stock. Our shares of
        common
        stock are approved for quotation on the OTC Bulletin Board under the symbol
        “MBKR”.


The
        following table represents the closing high and low bid information for our
        common stock during the last three fiscal years as reported by the OTC Bulletin
        Board. The quotations reflect inter-dealer prices, without retail mark-up,
        mark-down or commission and may not represent actual transactions. The market
        for our common stock is sporadic.
  **2006**
              **High**
              **Low**First
                  Quarter
              $0.625
              $0.30Second
                  Quarter
              $1.00
              $0.175Third
                  Quarter
              $1.00
              $0.25Fourth
                  Quarter
              $1.01
              $0.25**2005**
              **High**
              **Low**First
                  Quarter (commencing March 22, 2005)
              $0.1167
              $0.0417Second
                  Quarter
              $0.3125
              $0.075Third
                  Quarter
              $0.3625
              $0.175Fourth
                  Quarter
              $0.475
              $0.15
 **Dividends**




To
      date,
      we have paid no dividends on our shares of common stock and have no present
      intention of paying any dividends on our shares of common stock in the
      foreseeable future. The payment by us of dividends on the shares of common
      stock
      in the future, if any, rests solely within the discretion of our board of
      directors and will depend upon, among other things, our earnings, capital
      requirements and financial condition, as well as other factors deemed relevant
      by our board of directors. Although dividends are not limited currently by
      any
      agreements, it is anticipated that future agreements, if any, with institutional
      lenders or others may limit our ability to pay dividends on our shares of common
      stock.




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




The
      following information should be read in conjunction with the financial
      statements and notes thereto appearing elsewhere in this form
      10-KSB.






***CAUTIONARY
      NOTE REGARDING FORWARD-LOOKING STATEMENTS***






This
      Report contains certain financial information and statements regarding our
      operations and financial prospects of a forward-looking nature. Although these
      statements accurately reflect management’s current understanding and beliefs, we
      caution you that certain important factors may affect our actual results and
      could cause such results to differ materially from any forward-looking
      statements which may be deemed to be made in this Prospectus. For this purpose,
      any statements contained in this Prospectus which are not statements of
      historical fact may be deemed to be forward-looking statements. Without limiting
      the generality of the foregoing, words such as “may”, “intend”, “expect”,
“believe”, “anticipate”, “could”, “estimate”, “plan”, or “continue” or the
      negative variations of these words or comparable terminology are intended to
      identify forward-looking statements. There can be no assurance of any kind
      that
      such forward-looking information and statements in any way reflect our actual
      future operations and/or financial results, and any of such information and
      statements should not be relied upon either in whole or in part in any decision
      to invest in the shares. Many of the factors, which could cause actual results
      to differ from forward looking statements, are outside our control. These
      factors include, but are not limited to, the factors discussed above under
“Risk
      Factors.”




Organization
      and Nature of Business




MortgageBrokers.com,
      Holdings Inc. (the “Company”) registered a change of name with the state of
      Delaware in February 2005. We were formerly known as MagnaData, Inc. and
      organized under the laws of the State of Delaware on February 6,
      2003.




Our
      planned operations consist of becoming a financial services company centered
      around mortgage finance, brokerage, sales and consulting in Canada, the United
      States and the European Union (“E.U.”). Operations are presently conducted
      through our subsidiaries, Mortgagebrokers.com, Inc.  (Ontario
      corporation) and
      MortgageBrokers.com Financial Group of Companies, Inc
      (Canadian federal corporation ) in Canada only.




10


Current
      Activities




We
        are
        currently devoting substantially all of our efforts to establishing a new
        business.
  During
          the first half of 2005, management developed its business model, business
          plans
          and strategic market plans that included: organization of the company and
          divisions; identification of our sales channels and associated supply chain;
          development of marketing strategic plans and sales execution strategies;
          preparation of a financial plan, risk and capital structure planning models,
          and
          mortgage origination ‘book of business’ recruitment models; developing cash flow
          forecasts and an operating budget; identifying markets to raise additional
          equity capital and debt financing; embarking on research and development
          activities; performing employment searches and preparing agent contracts;
          and,
          recruiting and hiring technicians, management and industry
          specialists.
  We
          began
          to establish book keeping practices in mid 2005 to account for multiple
          subsidiaries, sales channels, and products and services with an initial
          focus on
          two profit center sales channels, namely: the mortgage broker sales channel
          - a
          national network of fully commissioned mortgage broker agent teams operating
          store front retail branch locations; and, the real estate sales channel
          -
          servicing strategic real estate partner lead referrals regionally supported
          with
          our network of mortgage agents.
 During
        the last half of 2005, we began to execute our business strategy and generate
        revenue. These activities included the recruitment and licensing of several
        mortgage broker mortgage origination ‘books of business’ in our mortgage broker
        sales channel. We have also commenced discussions with strategic market partners
        in our real estate sales channel. We have incurred expenses in the establishment
        of sales management resources and the launch of our mortgage broker and real
        estate sales channels. We received revenue from these operations.
  In
        the
        first two quarters of 2006, we continued to execute, test and refine our
        business strategy of recruiting and licensing mortgage brokerage books of
        business across Canada and solidifying our first two real estate strategic
        alliance partners, namely: Maxwell Realty Inc. and RE/MAX Ontario-Atlantic
        Canada Inc. Our first two real estate strategic alliance partners provide
        us
        with added market access initially in Alberta, Ontario and Eastern Canada
        and
        eventually in the United States and the E.U. Our existing real estate strategic
        alliances established in the last two quarters of 2006 with long term service
        agreements amount to a $30 billion mortgage origination sales opportunity
        annually.
  RE/MAX
        Ontario-Atlantic has licensed over 7,000 Sales Associates and closed over
        150,000 real estate transactions in 2005. In the audited financial statements
        for 2005, we announced the signing of a letter of intent with RE/MAX, who
        commands a real estate sales associate network of over 20,000 agents in 29
        countries. During the first quarter of 2006, we announced that RE/MAX and
        MortgageBrokers.com have executed a 10 year strategic alliance marketing,
        referral and revenue sharing agreement, renewable for an additional ten years,
        completing the relationship.
  In
        the
        first quarter 2006, service level agreements and strategic market licensure
        Agreements were executed with our strategic real estate alliance partners.
        The
        assets of Lending Source Canada Inc. in Alberta, Canada were acquired by
        our
        company in exchange for stock in our company to provide a platform for servicing
        our real estate strategic alliance partner, Maxwell Realty Inc. in Alberta.
        Maxwell is a growing organization of more than 650 real estate professionals
        since its launch in September 1999 and currently has 23 franchised offices
        throughout Alberta and British Columbia. Maxwell was an important strategic
        partner for MortgageBrokers.com who wanted to ensure that its compelling
        and
        sustainable mortgage origination model for the real estate industry resonated
        across Canada.




Our
        investment banking relationship with vFinance, Inc. of Florida was solidified
        in
        the first quarter of 2006 to provide the company on-going consulting services
        related to investment capital, and mergers and acquisitions.




11






In
          February, 2006, we issued a Private Placement Memorandum (“PPM”) to accredited
          and qualified investors on a prospectus exempt basis offering the sale
          of a
          minimum of 2,000,000 shares and a maximum of 6,000,000 shares at $1.00
          per share
          pursuant to the execution of a 10 year strategic alliance license agreement
          with
          RE/MAX Ontario-Atlantic Canada Inc. In June 1 st , 2006
          this private placement was completed and 2,112,470 shares at $1.00 per
          share for
          the amount of $2,112,470 were issued. A payment of $1,852,344.00 was received
          and promissory notes for the balance of $260,126were executed. Through the last quarter of 2005 and first quarter
          of
          2006, we executed notes for unsecured debt to RE/MAX Ontario-Atlantic Canada
          Inc. which were convertible to stock at the same price as offered through
          the
          private placement ($1.00 per share). These notes were converted to shares
          on
          June 12, 2006. Investors who subscribed for shares in the private placement
          received rights for 1 warrant priced at a 30% discount to market for each
          share
          subscribed for, executable at a rate of 20% per year and each warrant executable
          in a given year having a 30 day expiry following the 5 successive anniversary
          dates to the private placement closure date of June 1st. By December 31,
          2006,
          the Company had collected $25,000 in Promissory Notes receivable leaving
          a
          balance outstanding of $240,000.


Pursuant
      to a ten year licensing agreement dated January 30, 2006 and amended May 25,
      2006, and pursuant to the execution of a one year renewable service level
      agreement by the RE/MAX Franchisee, the Company is committed to issuing to
      RE/MAX at no cost, warrants for common stock of the Company based on referrals
      leading to funded mortgage origination volume. The RE/MAX Warrant-Based
      Compensation Program issues warrants as follows based on current
      formulae:


Annual
                  Volume:
              defined
                  as the total funded mortgage origination volume from RE/MAX lead
                  referral
                  executed per 12 month period following the Effective Date and subsequent
                  12 month periods following the anniversary dates of the Effective
                  DateNumber
                  of Warrants:
              USD
                  $3,000 US worth of warrants divided by the Strike Price per CDN
                  $10
                  million dollars in Annual Volume, adjusted on a pro rata basis,
                  no minimum
                  or maximum thresholds. The warrants are convertible in common shares
                  on a
                  1:1 basis.Earnings
                  Period:
              Series
                  IV warrants are earned in the first 3 years following the Effective
                  DateAdditional
                  Vestment:
              SERIES
                  IV warrants are fully vested on the 5th anniversary of the Effective
                  Date




Per
      a
      three year renewable agreement dated April 12, 2006 and pursuant to the
      execution of a service level agreement by the Maxwell Franchisee, the Company
      is
      committed to issuing to Maxwell, at no cost, warrants for common stock of the
      Company based on referrals leading to funded mortgage origination volume. The
      Maxwell Warrant-based Compensation Program, which issues warrants that are
      divided amongst the Maxwell Franchisor, Franchisee and referring Sales
      Agent.




Annual
                  Volume:
              defined
                  as the total funded mortgage origination volume from Maxwell lead
                  referral
                  executed per 12 month period following the Effective Date and subsequent
                  12 month periods following the anniversary dates of the Effective
                  DateNumber
                  of Warrants:
              USD
                  $3,000 worth of warrants divided by the Strike Price per CDN $10
                  million
                  in Annual Volume, adjusted on a pro rata basis, no minimum or maximum
                  thresholds. The warrants are convertible in common shares on a
                  1:1 basis.Earnings
                  Period:
              Series
                  III warrants are earned in the first 5 years following the Effective
                  DateAdditional
                  Vestment:
              the
                  warrants are fully vested on the fifth anniversary of the Effective
                  Date.


12


*Plan
      of Operations*




The
        company was founded to address market demands and opportunities for change
        within the mortgage brokerage industry in North America. After deconstructing
        the existing origination business models, the company developed a revolutionary
        business paradigm built on resolving long standing mortgage brokerage industry
        issues and creating a sustainable and compelling strategic partnership
        opportunity for market supply chain providers.
  Since
        launching the “Broker Channel Recruitment & Ownership Program” in August of
        2005, the company is now registered with Provincial regulators to conduct
        business in the Provinces of Newfoundland, Prince Edward Island, Nova Scotia,
        Ontario, Manitoba, Saskatchewan Alberta and British Columbia with plans in
        place
        to reach the other remaining Provinces in the coming year.
  Operationally
        we continue to integrate our Managing Partners and loan originators. This
        includes both migrating their operations and technology but also integrating
        new
        books of business they originate. From Q3 to Q4, our funding of new mortgage
        applications from our network of brokers increased 14.2% and tracking to
        remain
        flat in Q1 of 2007, typically the slowest quarter for applications during
        the
        fiscal year. The results in Q4, 2006, represented 37.1% of the entire year’s
        activities for the company, and Q3 and Q4 combined represents 70.5% of the
        entire years activities, an indication that our acquisitions and organic
        growth
        are transitioning into operational results.
  On
        October 24 th ,
        2005,
        we approved the issuance of 1,000,000 shares of restricted common stock to
        Mercatus & Partners Limited pursuant to a Stock Purchase Agreement for the
        total net proceeds of $630,000 to be paid to the company in December, 2005. On
        June
        18, 2006, correspondence was directed to Mercatus informing them of the
        Company’s decision to cancel this transaction and formally requesting the
        1,000,000 shares of Company stock to be returned. The common shares were
        recalled and cancelled officially on September 8, 2006.




*Marketing
      Activity:*




Through
      the licensing agreements with RE/MAX and Maxwell Realty Inc., we believe that
      the company’s industry and consumer marketing activity will substantively
      increase. This will likely occur on a broader scale in print, television, radio,
      point of sale displays and on-line as well as through joint marketing
      initiatives in local real estate offices and communities. Mortgage origination
      is closely tied to the real estate transaction and these local alliances are
      an
      important factor in brand recognition.




In
      July
      2006, leveraging RE/MAX market relationships, the MortgageBrokers.com
      relationship with RE/MAX was launched with an insert in the National Post
      newspaper.




On
      July
      31, 2006, Kathy Bevan of REM magazine (Real Estate Magazine) published a 1⁄2 page
      story on RE/MAX and its partnership with MortgageBrokers.com. The story, which
      was featured in REM’s August issue, discussed how RE/MAX identified their
      relationship with MortgageBrokers.com as revolutionary in their industry and
      that it would significantly benefit their agent sales force and their
      customers.




The
      company has continued to develop it’s brand through investing in the development
      of marketing materials geared to the RE/MAX agent explaining the benefits of
      the
      partnership to the RE/MAX agents and their customer as well as creating
      marketing materials for the MortgageBrokers.com recruitment sales force team
      across Canada to explain the company’s value proposition.




13


We
      have
      also worked diligently to launch the next version of our website to incorporate
      new tools to assist our ever growing mortgage sales force, our customers and
      our
      alliance partners.




*Business
      Development Activity:*




As
        of
        March 31, 2007, we have 192 licensed mortgage agents/ loan officers in our
        national origination sales force network. At the present time, the Company
        believes it has in excess of $2.0 billion in mortgage origination books of
        business in the agent recruitment pipeline. As of August, 2006 the company
        had
        established a national retail branch team network of 11 retail branch
        offices.


Commitments
      by the company to issue shares associated
      with agent recruitment signing bonuses and mortgage agent long term licensing
      agreements are non dilutive to shareholders for the first 4,000,000 shares
      issued for these purposes, since they are in an all-stock transaction through
      shares which were owned by the Chairman and CEO of MortgageBrokers.com Alex
      Haditaghi, thereby ensuring no dilution to the current shareholders takes place
      associated with this growth.




As
      part
      of this non-dilution growth strategy, as reported in the amended RE/MAX
      agreement (see Form 8K filing on June 14, 2006), Mr. Haditaghi agreed to
      invest up to 4,000,000 shares from his personal holdings of MortgageBrokers.com
      Class A stock into the Company’s Mortgage Broker Recruitment and Licensing
      program to accelerate the recruitment and licensure of industry leading, long
      term value minded mortgage originators. It is expected that as much as CDN
      $5
      billion in mortgage origination volume maybe recruited through this initiative
      that is non-dilutive with existing shareholders.




The
          company relationship with its Strategic partner RE/MAX continued its strong
          growth for 2006. Both RE/MAX and MortgageBrokers.com announced the selection
          of
          Manulife Financial as the new administrator of the Retirement Savings Program
          for RE/MAX Real Estate Agents. The company made the announcement with its
          strategic alliance partner RE/MAX Ontario-Atlantic Inc. (RE/MAX). Under
          the
          terms of the MortgageBrokers.com and RE/MAX strategic alliance, a portion
          of
          revenue generated on a funded mortgage referral will be contributed towards
          the
          Retirement Savings Program for the referring Real Estate Agent. Manulife
          Financial will support the continuing administration of this Program -
          the first
          of its scope in the Canadian Real Estate Industry. A corporate mini site
          was
          developed in Manulife website to provide additional information for Remax
          Sales
          associate about this program at www.manulife.ca/remax .
 Manulife
        Financial is a leading Canadian-based financial services group serving millions
        of customers in 19 countries and territories worldwide. Operating as Manulife
        Financial in Canada and Asia, and primarily through John Hancock in the United
        States, the Company offers clients a diverse range of financial protection
        products and wealth management services through its extensive network of
        employees, agents and distribution partners. Funds under management by Manulife
        Financial and its subsidiaries were Cdn$381 billion (US$341 billion) as at
        September 30, 2006.


Human
      Resources Activity:




As
      we
      continue to expand our business model to other geographical territories, the
      company will continue to seek out qualified candidates to expand our management
      team to sustain our growth strategies. To date the company has assembled a
      class
      act of industry veterans and retained the services of professionals outside
      the
      industry to continue to grow the company.




The
      company has successfully recruited a Regional Sales Manager for Atlantic Canada
      to recruit mortgage brokers and manage the expected expansion of our RE/MAX
      Ontario-Atlantic relationship, ensuring that have a corporate presence in
      Atlantic Canada. Due to this employee’s existing contractual agreements with
      their existing employer, further details are not available at this
      time.




In
      January 2007, the Company hired a new Director of Marketing who will be
      responsible for establishing national brand advertising and point of sale
      materials.




Liquidity
      and Capital Resources


As
        at
        December 31, 2006, we had $1,238,357 in cash; $30,320 of Referral Fees held
        in
        trust, $78,445 in prepaid expenses, $98,571 in equipment and recognized $5,198
        in equipment in capital leases for a total of $1,450,891 in assets.
        Comparatively as at December 31, 2005, we had $169,093 in cash and a total
        of
        $275,818 in total assets. The Company had $407,346 in accounts payable, $213,547
        in accrued liabilities, $204,868 in loans payable to a related party, $30,320
        payable in a Trust Liability, $5,589 in obligations under capital leases,
        $1,155,066 in stock-based compensation accrual and $98,682 in bank indebtedness
        related to an unsecured line of credit for a total of $2,115,418 in liabilities
        as at December 31, 2006. Comparatively as at December 31, 2005, we had $171,596
        in accounts payable and accrued liabilities, $332,865in loans payable to a related party, $118,160 in unsecured convertible
        notes payable, $625,911 in accrued employee stock-based compensation and
        $94,578
        in bank indebtedness related to an unsecured line of credit for a total of
        $1,343,110 in liabilities.




While
      the
      company works towards profitability in executing it’s business plan, we will
      rely upon the issuance of common stock and additional capital contributions
      from
      shareholders to fund expenses. There are no guarantees that we will be
      successful in the industry.




While
        the
        accrual and issue of warrant-based compensation represents an immediate charge
        to the Company’s bottom line at this early stage in it’s growth, the Company
        believes that the benefits of leveraging the Company’s capital structure to
        rapidly build a long term quality origination sales force and sales referral
        pipeline far outweigh the short term expense as we build a long term,
        sustainably profitable partnership with our market partners whose interests
        are
        aligned with those of shareholders.




14







Critical
      Accounting Policies




Our
      financial statements and related public financial information are based on
      the
      application of accounting principles generally accepted in the United States
      (“GAAP”). GAAP requires the use of estimates; assumptions, judgments and
      subjective interpretations of accounting principles that have an impact on
      the
      assets, liabilities, revenue and expense amounts reported. These estimates
      can
      also affect supplemental information contained in our external disclosures
      including information regarding contingencies, risk and financial condition.
      We
      believe our use if estimates and underlying accounting assumptions adhere to
      GAAP and are consistently and conservatively  applied. We base our
      estimates on historical experience and on various other assumptions that we
      believe to be reasonable under the circumstances. Actual results may differ
      materially from these estimates under different assumptions or conditions.
      We
      continue to monitor significant estimates made during the preparation of our
      financial statements.




15







**ITEM
      7. FINANCIAL STATEMENTS**


**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
  CONSOLIDATED
        FINANCIAL STATEMENTS
  DECEMBER
        31, 2006 AND 2005 (RESTATED)
  **CONTENTS**




Report
                  of Independent Registered Public Accounting Firm
              **1**Consolidated
                  Balance Sheets
              **2**Consolidated
                  Statements of Operations and Comprehensive Loss
              **3**Consolidated
                  Statements of Stockholders' Deficit
              **4
                  - 5**Consolidated
                  Statements of Cash Flows
              **6**Notes
                  to Consolidated Financial Statements
              **7
                  - 29**











**REPORT
        OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**
  To
        the
        Board of Directors and Stockholders of
 **Mortgagebrokers.com
        Holdings, Inc. and Subsidiaries**
 **(Formerly
        MagnaData, Inc.)**
  We
        have
        audited the accompanying consolidated balance sheets of **Mortgagebrokers.com
        Holdings, Inc. and Subsidiaries**  **(Formerly
        MagnaData, Inc.)** (a
        Delaware corporation) as of December 31, 2006 and 2005, and the related
        statements of operations and comprehensive loss, stockholders' deficit, and
        cash
        flows for each of the years in the two-year period ended December 31, 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 audit.
  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 included consideration of internal control
        over
        financial reporting as a 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 also includes
        examining, on a test basis, evidence supporting the amounts and disclosures
        in
        the financial statements, 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 **Mortgagebrokers.com
        Holdings, Inc. and Subsidiaries** as of
        December 31, 2006 and 2005, and the results of its operations and its cash
        flows
        for each of the years in the two-year period ended December 31, 2006 in
        conformity with accounting principles generally accepted in the United States
        of
        America.
  The
          accompanying financial statements have been prepared assuming that the
          Company
          will continue as a going concern. As discussed in note 1 to the financial
          statements, the Company has suffered recurring losses and negative working
          capital from operations, which raises substantial doubt about its ability
          to
          continue as a going concern. Management’s plan in regard to these matters are
          also described in note 1. The financial statements do not include any
          adjustments that might result from the outcome of this
          uncertainty.
  "SF
        PARTNERSHIP, LLP"
 CHARTERED
        ACCOUNTANTS
  **Toronto,
        Canada**
 April
        12,
        2007






-1-




**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Consolidated
        Balance Sheets
 December
        31, 2006 and 2005 (Restated)




(Restated,Note
                  3)**2006**
              
              2005**ASSETS****Current
                  Assets**Cash
                  and cash equivalents
              
              
              **1,238,357**
              
              $
              169,093Referral
                  fees held in trust (note 10)
              
              
              **30,320**
              
              
              -Prepaid
                  expense
              
              
              **78,445**
              
              
              9,888**Total
                  Current Assets**
              
              
              **1,347,122**
              
              
              178,981**Equipment,
                  net**(note
                  4)
              
              
              **98,571**
              
              
              88,239**Equipment
                  Under Capital Leases**(note
                  5)
              
              
              **5,198**
              
              
              -**Deferred
                  Offering Costs**(note
                  6)
              
              
              **-**
              
              
              8,598**Total
                  Assets**
              
              $
              **1,450,891**
              
              $
              275,818**LIABILITIES****Current
                  Liabilities**Bank
                  indebtedness (note 7)
              
              
              **98,682**
              
              $
              94,578Accounts
                  payable
              
              
              **407,346**
              
              
              171,596Accrued
                  liabilities
              
              
              **213,547**
              
              
              -Notes
                  payable (note 8)
              
              
              **-**
              
              
              118,160Advances
                  from related party (note 9)
              
              
              **204,868**
              
              
              332,865Trust
                  liability (note 10)
              
              
              **30,320**
              
              
              -Obligation
                  under capital leases - current portion (note 11)
              
              
              **1,674**
              
              
              -Stock-based
                  compensation accrual - current portion (note 12b)
              
              
              **232,082**
              
              
              -Employee
                  stock-based compensation accrual (note 12c)
              
              
              **813,850**
              
              
              625,911**Total
                  Current Liabilities**
              
              
              **2,002,369**
              
              
              1,343,110**Obligation
                  Under Capital Leases**(note
                  11)
              
              
              **3,915**
              
              
              -**Stock-based
                  Compensation Accrual**(note
                  12a)
              
              
              **109,134**
              
              
              -**Total
                  Liabilities**
              
              
              **2,115,418**
              
              
              1,343,110**Commitments
                  and Contingencies**(note
                  19)**STOCKHOLDERS'
                  DEFICIT****Capital
                  Stock**Preferred
                  stock, $0.0001 par value; 5,000,000 shares
                authorized, none issued
              
              
              **-**
              
              
              -Capital
                  stock, $0.0001 par value; 100,000,000 shares
                authorized; 36,088,470 (2005: 33,935,000) issued and
                outstanding****(note
                  13)
              
              
              **3,609**
              
              
              3,394**Additional
                  Paid-in Capital**
              
              
              **2,179,443**
              
              
              760,111**Additional
                  Paid-in Capital - Warrants**(note 14)
              
              
              **732,605**
              
              
              -**Subscription
                  for Stock**
              
              
              **-**
              
              
              100,000**Subscription
                  Receivable**(note
                  15)
              
              
              **(242,301**
              **)**
              
              (630,000
              )**Treasury
                  Stock******(note
                  16)
              
              
              **(17,779**
              **)**
              
              -**Accumulated
                  Other Comprehensive (Loss) Income**
              
              
              **(7,417**
              **)**
              
              3,213**Accumulated
                  Deficit**
              
              
              **(3,312,687**
              **)**
              
              (1,304,010
              )**Total
                  Stockholders' Deficit**
              
              
              **(664,527**
              **)**
              
              (1,067,292
              )**Total
                  Liabilities and Stockholders' Deficit**
              
              $
              **1,450,891**
              
              $
              275,818




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





-2-




**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES** ****
 **(FORMERLY
        MAGNADATA, INC.)**
 Consolidated
        Statement of Operations and Comprehensive Loss
 Years
        Ended December 31, 2006, and 2005 (Restated)




**2006**
              
              (Restated,
                Note
                  3)
                2005**Revenue**
              
              
              **4,023,281**
              
              
              229,603**Expenses**Commission
                  and agent fees
              
              
              **3,067,143**
              
              
              109,610Salaries
                  and benefits
              
              
              **1,345,260**
              
              
              315,504General
                  and administrative expenses
              
              
              **853,542**
              
              
              294,755Stock-based
                  compensation (note 19c(ii))
              
              
              **232,082**
              
              
              -Employee
                  stock-based compensation (note 12c)
              
              
              **187,939**
              
              
              625,911Stock-based
                  compensation (note 19a, 19b, and 19c(i))
              
              
              **109,134**
              
              
              -Interest
                  expense - beneficial conversion feature (note 8)
              
              
              **108,840**
              
              
              5,660Occupancy
                  costs (note 17)
              
              
              **95,212**
              
              
              94,933**Total
                  Operating Expenses**
              
              
              **5,999,152**
              
              
              1,446,373**Loss
                  from Operations**
              
              
              **(1,975,871**
              **)**
              
              (1,216,770
              )**Other
                  (Expense)****Income**Interest
                  and bank charges
              
              
              **(7,228**
              **)**
              
              764Write-off
                  of goodwill
              
              
              **-**
              
              
              (8,000
              )Gain
                  on extinguishment of debt
              
              
              **-**
              
              
              80,425Loss
                  on impairment of equipment
              
              
              **(25,578**
              **)**
              
              -**Total
                  Other (Expense) Income**
              
              
              **(32,806**
              **)**
              
              73,189**Loss
                  Before Income Taxes**
              
              
              **(2,008,677**
              **)**
              
              (1,143,581
              )Provision
                  for income taxes (note 18)
              
              
              **-**
              
              
              -**Net
                  Loss**
              
              
              **(2,008,677**
              **)**
              
              (1,143,581
              )**Foreign
                  Currency Translation Adjustment**
              
              
              **(**10,630****
              **)**
              
              3,213**Total
                  Comprehensive Loss**
              
              
              **(**2,019,307****
              **)**
              
              (1,140,368
              )**Net
                  Loss per Share - Basic and Diluted During the
                  Year**
              
              
              **(0.06**
              **)**
              
              (0.04
              )**Weighted
                  Average Number of Shares Outstanding - Basic and Diluted During
                  the
                  Year**
              
              
              **35,693,625**
              
              
              **27,103,729**




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






-3-




**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Consolidated
        Statements of Stockholders' Deficit
 Years
        Ended December 31, 2006 and 2005 (Restated)


**Accumulated**
              
              **Additional**
              
              
              
              **Accumulated****Additional**
              
              **Paid-In**
              
              
              
              
              
              
              
              **Other**
              
              
              
              **Total****Common**
              
              **Stock**
              
              **Paid-In**
              
              **Capital
                  -**
              
              **Subscription**
              
              **Subscription**
              
              **Treasury**
              
              **Comprehensive**
              
              **Accumulated**
              
              **Stockholders'****Shares**
              
              **Amount**
              
              **Capital**
              
              **Warrants**
              
              **for
                  Stock**
              
              **Receivable**
              
              **Stock**
              
              **(Loss)
                  Income**
              
              **Deficit**
              
              **Deficit**Deficit
                  - January 1, 2005
              
              
              28,935,000
              
              $
              193
              
              $
              87,812
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              (160,429
              )
              $
              (72,424
              )March
                  11, 2005 - 15 for 1 forward stock split (note 13)
              
              
              -
              
              
              2,701
              
              
              (2,701
              )
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -March
                  21, 2005 - shares issued to acquire subsidiary
                (note
                  13)
              
              
              4,000,000
              
              
              400
              
              
              7,600
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              8,000November
                  11, 2005 - Issued for $0.63 per share (note 13)
              
              
              1,000,000
              
              
              100
              
              
              629,900
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              630,000Subscription
                  receivable (note 15)
              
              
              -
              
              
              -
              
              
              -
              
              
              
              
              
              -
              
              
              (630,000
              )
              
              -
              
              
              -
              
              
              -
              
              
              (630,000
              )Beneficial
                  conversion feature of convertible debenture
                (note
                  8)
              
              
              -
              
              
              -
              
              
              37,500
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              37,500Foreign
                  currency translation adjustment
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              11,128
              
              
              -
              
              
              11,128Subscription
                  for stock
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              100,000
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              100,000Net
                  loss for the period
              
              
              **-**
              
              
              -
              
              
              **-**
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              **-**
              
              
              (499,977
              )
              
              (499,977
              )Deficit
                  - December 31, 2005
              
              
              33,935,000
              
              $
              3,394
              
              $
              722,611
              
              $
              -
              
              $
              100,000
              
              $
              (630,000
              )
              $
              -
              
              $
              11,128
              
              $
              (660,406
              )
              $
              (553,273
              )Restatement
                (note 3)
              
              
              
              
              
              
              
              
              37,500
              
              
              
              
              
              100,000
              
              
              
              
              
              
              
              
              (7,915
              )
              
              (613,604
              )
              
              (514,019
              )Deficit-December
                31, 2005
              
              
              33,935,000
              
              $
              3,394
              
              $
              760,111
              
              
              -
              
              
              100,000
              
              
              (630,000
              )
              
              -
              
              
              3,213
              
              
              (1,304,010
              )
              
              (1,067,292
              )








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




**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Consolidated
        Statements of Stockholders' Deficit (Continued)
 Years
        Ended December 31, 2006 and 2005 (Restated)




**Common**
                **Shares**
              
              **Stock**
                **Amount**
              
              **Accumulated**
                **Additional**
                **Paid-In**
                **Capital**
              
              **Additional**
                **Paid-In**
                **Capital
                  -**
                **Warrants**
              
              **Subscription**
                **for
                  Stock**
              
              **Subscription**
                **Receivable**
              
              **Treasury**
                **Stock**
              
              **Accumulated**
                **Other**
                **Comprehensive**
                **(Loss)
                  Income**
              
              **Accumulated**
                **Deficit**
              
              **Total**
                **Stockholders'**
                **Deficit**Deficit
                  - December 31, 2005
              
              
              33,935,000
              
              **$**
              3,394
              
              **$**
              760,111
              
              **$**
              -
              
              **$**
              100,000
              
              **$**
              (630,000
              )
              **$**
              -
              
              **$**
              3,213
              
              **$**
              (1,304,010
              )
              **$**
              (1,067,292
              )Shares
                  issued for cash:March
                  14, 2006 - Issued for $1.00 per share
                (note
                  13)
              
              
              100,000
              
              
              10
              
              
              99,990
              
              
              -
              
              
              (100,000
              )
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -April
                  25, 2006- Issued for $0.5 per share
                (note
                  13)
              
              
              1,000,000
              
              
              100
              
              
              499,900
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              500,000June
                  12, 2006- Issued for $1.00 per share
                (note
                  13)
              
              
              2,112,470
              
              
              211
              
              
              2,112,259
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              2,112,470Issuance
                of warrants (note 14)
              
              
              
              
              
              
              
              
              (732,605
              )
              
              732,605Shares
                  issued for services:March
                  14, 2006 - Issued for $1.80 per share
                (note
                  13)
              
              
              245,000
              
              
              25
              
              
              440,976
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              441,001October
                  30, 2006 - Issued for $0.53 per share
                (note
                  13)
              
              
              96,000
              
              
              10
              
              
              50,870
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              50,880Shares
                  issued for equipment:March
                  14, 2006- Issued for $0.59 per share
                (note
                  13)
              
              
              100,000
              
              
              10
              
              
              58,791
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              58,801Cancelled
                  shares:August
                  8, 2006 (note
                  12)
              
              
              (500,000
              )
              
              (50
              )
              
              (499,950
              )
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (500,000
              )September
                  8, 2006 (note
                  15)
              
              
              (1,000,000
              )
              
              (100
              )
              
              (629,900
              )
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (630,000
              )Subscription
                receivable note 15
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              630,000
              
              
              
              
              
              
              
              
              
              
              
              630,000Subscription
                  receivable (note 15)
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (242,301
              )
              
              -
              
              
              -
              
              
              -
              
              
              (242,301
              )Treasury
                  stock (note 16)
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (17,779
              )
              
              -
              
              
              -
              
              
              (17,779
              )Reduction
                  in legal fees
              
              
              -
              
              
              -
              
              
              (58,000
              )
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (58,000
              )Beneficial
                  conversion feature of
                convertible
                  debenture (note 8)
              
              
              -
              
              
              -
              
              
              77,000
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              77,000Foreign
                  currency translation adjustment
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (10,630
              )
              
              -
              
              
              (10,630
              )Net
                  loss for the year
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              (2,008,677
              )
              
              (2,008,677
              )**Deficit
                  - December 31, 2006**
              
              
              **36,088,470**
              
              **$**
              **3,609**
              
              **$**
              **2,179,443**
              
              **$**
              **732,605**
              
              **$**
              **-**
              
              **$**
              **(242,301**
              **)**
              **$**
              **(17,779**
              **)**
              **$**
              **(7,417**
              **)**
              **$**
              **(3,312,687**
              **)**
              **$**
              **(664,527**
              **)**






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








-5-




**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Consolidated
        Statement of Cash Flows
 Year
        Ended December 31, 2006, 2005 (Restated)


**2006**
              
              (Restated
                Note3)
                2005**Cash
                  Flows from Operating Activities**Net
                  loss
              
              **$**
              **(2,008,677**
              **)**
              $
              (1,143,581
              )Adjustments
                  to reconcile net loss to net cash (used in) operating
                  activities:Depreciation
              
              
              **26,408**
              
              
              7,236Loss
                  on disposal of assets
              
              
              **25,578**
              
              
              -Interest
                  expense -
                  beneficial conversion feature
              
              
              **108,840**
              
              
              5,660Stock
                  issued for
                  services
              
              
              **441,000**
              
              
              -Employee
                  stock-based compensation
              
              
              **187,939**
              
              
              625,911Stock-based
                compensation accruel
              
              
              **341,216**
              
              
              0Goodwill
                  impairment
                  write-down
              
              
              -
              
              
              8,000Gain
                  on extinguishment of debt
              
              
              -
              
              
              (80,425
              )Net
                  changes in non-working capital:Referral fees held in trust
              
              
              **(30,320**
              **)**
              
              -Prepaid
                  expense
              
              
              **(17,677**
              **)**
              
              (9,888
              )Other
                  receivables
              
              
              **-**
              
              
              (8,000
              )Accounts
                  payable
              
              
              **312,673**
              
              
              176,316Accrued
                  liabilities
              
              
              **213,547**
              
              
              -Trust
                  liability
              
              
              **30,320**
              
              
              -**Net
                  Cash (Used in) Operating Activities**
              
              
              **(**369,153****
              **)**
              
              (418,771
              )**Cash
                  Flows from Investing Activities**Purchase
                  of equipment, net
              
              
              **(**29,094****
              **)**
              
              (95,475
              )Disposal
                of equipment
              
              
              **25,578**
              
              
              -Equipment
                  under capital leases
              
              
              **(5,198**
              **)**
              
              -**Net
                  Cash Used in Investing Activities**
              
              
              **(8,714**
              **)**
              
              (95,475
              )**Cash
                  Flows from Financing Activities**Deferred
                  offering costs
              
              
              **8,598**
              
              
              (8,598
              )Proceeds
                  from notes payable
              
              
              **23,000**
              
              
              112,500Obligation
                  under capital leases
              
              
              **5,589**
              
              
              -Proceeds
                  from advances from related party
              
              
              **-**
              
              
              332,865Repayment
                  of advances from related party
              
              
              **(127,997**
              **)**
              
              (5,135
              )Issuance
                  of common stock for cash
              
              
              **829,634**
              
              
              45,500Treasury
                  stock
              
              
              **(17,779**
              **)**
              
              -Proceeds
                  from issuance of warrants for cash
              
              
              **732,605**
              
              
              -Subscription
                  for
                  stock
              
              
              **-**
              
              
              100,000Increase
                  in bank indebtedness
              
              
              **4,104**
              
              
              94,578**Net
                  Cash Provided by Financing Activities**
              
              
              **1,457,754**
              
              
              671,710**Net
                  (Decrease) Increase in Cash and Cash Equivalents**
              
              
              **1,079,887**
              
              
              157,464**Foreign
                  Exchange on Balances**
              
              
              **(10,623**
              **)**
              
              3,213**Cash
                  and Cash Equivalents - Beginning of Year**
              
              
              **169,093**
              
              
              8,416**Cash
                  and Cash Equivalents - End of Year**
              
              **$**
              **1,238,357**
              
              $
              169,093**Supplemental
                  Cash Flow Information**Interest
                  paid
              
              **$**
              **4,944**
              
              $
              -Income taxes paid
              
              **$**
              **-**
              
              $
              -


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




-6-




**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Notes
        to
        Consolidated Financial Statements
 December
        31, 2006 and 2005 (Restated)




**1.**
              **Nature
                  of Business and Going Concern**
  Nature
        of Business
  MortgageBrokers.com
        Holdings, Inc., which registered a change of name with the state of Delaware
        in
        February 2005, and Subsidiaries (Canadian corporations) (the “Company”) was
        formerly known as MagnaData, Inc. and organized under the laws of the State
        of
        Delaware on February 6, 2003.
  The
        operations of the Company consist of financial services centered around mortgage
        finance, brokerage, real estate sales and consulting in Canada, with planned
        future operations in the United States and the European Union (“E.U.”).
        Operations are presently conducted through the Company’s subsidiaries,
        Mortgagebrokers.com, Inc. and MortgageBrokers.com Financial Group of Company,
        Inc., in Canada only.
  Change
        of Control
  On
        January 31, 2005, the Company’s majority shareholder, Alex Haditaghi, purchased
        1,510,000 common stock from three shareholders of MagnaData Inc. for cash
        consideration ($692,813) in an arms length transaction. This share purchase
        represented approximately 78% of MagnaData’s common stock outstanding at the
        time of the transaction, based on the company’s December, 2004, Form 10-KSB. On
        February 11, 2005 MagnaData Inc.’s name was changed to MortgageBrokers.com
        Holdings, Inc.
  As
        part
        of the sale, $74,727 of the Company’s debt was forgiven by a third party and
        $5,698 of the Company’s debt and accrued interest was forgiven by a shareholder
        which resulted in a gain on forgiveness of debt of $80,425.
  Going
        Concern
  The
        Company’s consolidated financial statements are presented on a going concern
        basis, which contemplates the realization of assets and satisfaction of
        liabilities in the normal course of business. For the year ended December
        31,
        2006, the Company incurred a loss of $2,008,677 (2005 Restated -
        $1,143,581).
  The
        Company’s ability to continue as a going concern is contingent upon its ability
        to secure additional debt or equity financing, initiate sales of its products
        and sustain profitable operations.
 
 -7-
  **MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Notes
        to
        Consolidated Financial Statements
 December
        31, 2006 and 2005 (Restated)




**1.**
              **Nature
                  of Business and Going Concern(cont'd)**
  Going
        Concern (cont'd)
  The
        Company has devoted substantially all of its efforts to establishing its
        current
        business. Management developed its business model, business plans and strategic
        marketing plans that included: organization of the Company and divisions;
        identification of the Company’s sales channels and associated supply chain;
        development of marketing strategic plans and sales execution strategies;
        preparation of a financial plan, risk and capital structure planning models,
        and
        mortgage origination ‘book of business’ models; establishing the operational
        parameters for a centralized shared services underwriting call centre;
        developing cash flow forecasts and an operating budget; identifying markets
        to
        raise additional equity capital and debt financing; embarking on research
        and
        development activities; performing employment searches and preparing agent
        contracts; and, recruiting and hiring technicians, management and industry
        specialists.
  The
        consolidated financial statements do not include any adjustments to reflect
        the
        possible future effects on the recoverability and classification of assets
        or
        the amounts and classification of liabilities that may result from the possible
        inability of the Company to continue as a going concern.
  **2.**
              **Summary
                  of Significant Accounting
                  Policies**
  The
        accounting policies of the Company are in accordance with accounting principles
        generally accepted in the United States of America, and their basis of
        application is consistent. Outlined below are those policies considered
        particularly significant:
  a)
              Basis
                  of Consolidation and Presentation
  The
        consolidated financial statements include the accounts of the Company and
        its
        wholly-owned subsidiaries Mortgagebrokers.com Inc. and Mortgagebrokers.com
        Financial Group of Companies, Inc. and are presented under the accrual basis
        of
        accounting. All significant inter-company transactions and balances have
        been
        eliminated upon consolidation.
  b)
              Cash
                  and Cash Equivalents
  Cash
        and
        cash equivalents consist of cash on account and short-term investments with
        remaining maturities at acquisition of three months or less.
  c)
              Equipment,
                  net
  Equipment
        is recorded at cost. Depreciation is calculated using the following annual
        rates
        and methods base on estimated useful lives:
  Furniture
                    and equipment
                20%
                    decliningComputer
                    equipment
                30%
                    decliningComputer
                    software
                30%
                    decliningLeasehold
                    improvements
                20%
                    straight line






-8-




**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Notes
        to
        Consolidated Financial Statements
 December
        31, 2006 and 2005 (Restated)


**2.**
              **Summary
                  of Significant Accounting Policies**(cont'd)
  d)
              Deferred
                  Offering Costs
  The
        Company defers the direct incremental costs of raising capital until such
        time
        as the offering is completed. At the time of completion of the offering,
        the
        costs are charged against the capital raised. Should the offering be terminated,
        deferred offering costs are charged to operations during the period in which
        the
        offering is terminated.
  e)
              Revenue
                  Recognition
  Revenue
        consists of mortgage brokerage fees and finders fees. The revenue is recognized
        upon the funding of a borrowers mortgage and when the collection is reasonably
        assured which occurs when the fee from the bank has been advanced.
  f)
              Use
                  of Estimates
  Preparation
        of financial statements in accordance with accounting principles generally
        accepted in the United States of America requires management to make estimates
        and assumptions that affect the amounts reported in the financial statements
        and
        related notes to financial statements. These estimates are based on management’s
        best knowledge of current events and actions the Company may undertake in
        the
        future. Actual results may ultimately differ from estimates, although management
        does not believe such changes will materially affect the consolidated financial
        statements in any individual year.
  g)
              Financial
                  Instruments
  In
        accordance with Statement of Financial Accounting Standards ("SFAS") SFAS
        No.
        107, "Disclosures About Fair Value of Financial Instruments" ("SFAS No. 107"),
        the estimated fair value of financial instruments has been determined by
        the
        Company using available market information and valuation methodologies.
        Considerable judgment is required in estimating fair value. Accordingly,
        the
        estimates may not be indicative of the amounts the Company could realize
        in a
        current market exchange. As of December 31, 2006, the carrying value of accounts
        payable and accrued liabilities, advances from related party and long term
        debt
        approximate their fair value.






-9-




**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Notes
        to
        Consolidated Financial Statements
 December
        31, 2006 and 2005 (Restated)


**2.**
              **Summary
                  of Significant Accounting Policies**(cont'd)
  h)
              Impairment
                  of Long-lived Assets
  In
        accordance with SFAS No. 144, "Accounting for the Impairment or Disposal
        of
        Long-Lived Assets", long-lived assets to be held and used are analyzed for
        impairment whenever events or changes in circumstances indicate that the
        related
        carrying amounts may not be recoverable. The Company evaluates whether events
        and circumstances have occurred that indicate possible impairment. If there
        are
        indications of impairment, the Company uses future undiscounted cash flows
        of
        the related asset or asset grouping over the remaining life in measuring
        whether
        the assets are recoverable. In the event such cash flows are not expected
        to be
        sufficient to recover the recorded asset values, the assets are written down
        to
        their estimated fair value. Long-lived assets to be disposed of are reported
        at
        the lower of carrying amount or fair value of asset less cost to sell. As
        described in note 1, the long-lived assets have been valued on a going concern
        basis, however, substantial doubt exists as to the ability of the Company
        to
        continue as a going concern. If the Company ceases operations, the asset
        values
        may be materially impaired.
  i)
              Share-based
                  Payment
  The
        Company adopted the disclosure requirements of SFAS No. 123R, "Share-Based
        Payment" ("SFAS No. 123R") for stock options and similar equity instruments
        (collectively, "options") issued to employees. The Company applies the fair
        value base method of accounting as prescribed by SFAS No. 123R. Under the
        fair
        value based method, compensation cost is measured at the grant date based
        on the
        value of the award and is recognized over the service period, which is usually
        the vesting period. For stock options, the fair value is determined using
        an
        option-pricing model that takes into account the stock price at the grant
        date,
        the exercise price, the expected life of the option, the volatility of the
        underlying stock and the expected dividends on it, and the risk-free interest
        rate over the expected life of the option. SFAS No. 123R also applies to
        transactions in which an entity issues its equity instruments to acquire
        goods
        or services from non-employees. Those transactions must be accounted for
        based
        on the fair value of the consideration received or the fair value of the
        equity
        instruments issued, whichever is more reliably measurable, as described in
        note
        13.
  j)
              Notes
                  Payable
  The
        notes
        payable has a beneficial conversion feature soon upon issuance of the
        convertible note, the Company recorded a discount to the notes to reflect
        the
        value of the beneficial conversion feature that is amortized as additional
        non-cash interest expense over the term of the convertible note. The beneficial
        conversion feature occurred because the conversion rate of the convertible
        note
        was less than the market value of the Company’s common stock at the time that
        the note was issued.






-10-




**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Notes
        to
        Consolidated Financial Statements
 December
        31, 2006 and 2005 (Restated)
  **2.**
              **Summary
                  of Significant Accounting Policies**(cont'd)
  k)
              Income
                  Taxes
  The
        Company accounts for income taxes in accordance with SFAS No. 109, “Accounting
        for Income Taxes”. Deferred tax assets and liabilities are recorded for
        differences between the consolidated financial statement and tax basis of
        the
        assets and liabilities that will result in taxable or deductible amounts
        in the
        future based on enacted tax laws and rates. Valuation allowances are established
        when necessary to reduce deferred tax assets to the amount expected to be
        realized. Income tax expense is recorded for the amount of income tax payable
        or
        refundable for the period increased or decreased by the change in deferred
        tax
        assets and liabilities during the period.
  l)
              Earnings
                  or Loss Per Share
  Basic
        earnings per share (“EPS”) is computed by dividing earnings available to common
        shareholders by the weighted average number of common shares outstanding
        for the
        period as required by the Financial Accounting Standards Board (FASB) under
        SFAS
        No. 128, “Earnings per Shares”. Diluted EPS reflects the potential dilution of
        securities that could share in the earnings. As at December 31, 2006 there
        were
        no dilutive securities that would impact the EPS.
  m)
              Foreign
                  Currency Translation
  The
        Company accounts for foreign currency translation pursuant to SFAS No. 52,
        “Foreign Currency Translation”. The Company’s functional currency is the
        Canadian dollar. All assets and liabilities are translated into United States
        dollars using the exchange rates prevailing at the end of the year. Revenues
        and
        expenses are translated using the average exchange rates prevailing throughout
        the year.
  Unrealized
        foreign exchange amounts resulting from translations at different rates
        according to their nature are included in accumulated other comprehensive
        income.
  Realized
        foreign currency transaction gains and losses are recognized in
        operations.
  n)
              Comprehensive
                  Income or Loss
  The
        Company adopted SFAS No. 130, “Reporting Comprehensive Income.” SFAS No. 130
        establishes standards for reporting and presentation of comprehensive income
        and
        its components in a full set of financial statements. Comprehensive income
        is
        presented in the statements of stockholders’ equity, and consists of net loss
        and unrealized gains (loss) on available for sale marketable securities;
        foreign
        currency translation adjustments and changes in market value of future contracts
        that qualify as a hedge; and negative equity adjustments recognized in
        accordance with SFAS No. 87. SFAS No. 130 requires only additional disclosures
        in the financial statements and does not affect the Company’s financial position
        or results of operations.




-11-




**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Notes
        to
        Consolidated Financial Statements
 December
        31, 2006 and 2005 (Restated)
  **2.**
              **Summary
                  of Significant Accounting Policies**(cont'd)
  o)
              Concentration
                  of Credit Risk
  SFAS
        No.
        105, “Disclosure of Information About Financial Instruments with Off-Balance
        Sheet Risk and Financial Instruments with Concentration of Credit Risk”,
        requires disclosure of any significant off-balance sheet risk and credit
        risk
        concentration. The Company does not have significant off-balance sheet risk
        or
        credit concentration.
  p)
              Recent
                  Accounting Pronouncements
  In
        February 2006, FASB issued SFAS No. 155, "Accounting for Certain Hybrid
        Financial Instruments an Amendment to FASB Statements No. 133 and 140" ("SFAS
        No. 155"). This statement permits fair value of remeasurement for any hybrid
        financial instrument that contains an embedded derivative that otherwise
        would
        require bifurcation; clarifies which interest-only strips and principal-only
        strips are not subject to the requirements of SFAS No. 133, "Accounting for
        Derivative Instruments and Hedging Activities"; establishes a requirement
        to
        evaluate interests in securitized financial assets to identify interests
        that.
        are freestanding derivatives or that are hybrid financial instruments that
        contain an embedded derivative requiring bifurcation; clarifies that
        concentrations of credit risk in the form of subordination are not embedded
        derivatives; and amended SFAS No. 140, "Accounting for Transfers and Servicing
        of Financial Assets and Extinguishments of Liabilities a replacement of FASB
        Statement No. 125" ("SFAS No. 140"), to eliminate the prohibition on a
        qualifying special-purpose entity from holding a derivative financial instrument
        that pertains to a beneficial interest other than another derivative financial
        instrument. SFAS No. 155 is effective for all financial instruments acquired,
        issued, or subject to a remeasurement (new basis) event occurring after the
        beginning of an entity's first fiscal year that begins after September 15,
        2006.
        The Company is currently reviewing the effect, if any, the proposed guidance
        will have on its financial position.
  In
        March
        2006, the FASB issued Statement No. 156, "Accounting for Servicing of Financial
        Assets an amendment of FASB Statement No. 140" ("SFAS No. 156"). In a
        significant change to current guidance, the SFAS No. 156 permits an entity
        to
        choose either of the following subsequent measurement methods for each class
        of
        separately recognized servicing assets and servicing liabilities: (1)
        amortization method or (2) fair value measurement method. SFAS No. 156 is
        effective as of the beginning of an entity's first fiscal year that begins
        after
        September 15, 2006. The Company is currently reviewing the effect, if any,
        the
        proposed guidance will have on its financial position.






-12-




**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Notes
        to
        Consolidated Financial Statements
 December
        31, 2006 and 2005 (Restated)


**2.**
              **Summary
                  of Significant Accounting Policies**(cont'd)
  p)
              Recent
                  Accounting Pronouncements (cont'd)
  In
        June
        2006, the FASB issued Financial Accounting Standards Board Interpretation
        No.
        48, "Accounting for Uncertainty in Income Taxes an interpretation of FASB
        Statement No. 109" ("FIN No. 48"), which clarifies the accounting for
        uncertainty in income taxes recognized in an enterprise's financial statements
        in accordance with SFAS No. 109. This interpretation prescribes a recognition
        threshold and measurement attribute for the financial statement recognition
        and
        measurement of a tax position taken or expected to be taken in a tax return.
        This interpretation also provides guidance on derecognition, classification,
        interest and penalties, accounting in interim periods, disclosure, and
        transition. FIN No. 48 is effective for fiscal years beginning after December
        15, 2006. Earlier application of the provision of FIN No. 48 is encouraged
        if
        the enterprise has not yet issued financial statements, including interim
        financial statements, in the period this interpretation is adopted. The Company
        is currently reviewing the effect, if any, the proposed guidance will have
        on
        its financial position.
  In
        September 2006, the FASB issued SFAS No. 157, "Fair Value Measurements" ("SFAS
        No. 157"). This statement defines fair value, establishes a framework for
        measuring fair value in generally accepted accounting principles, and expands
        disclosure about fair value measurements. This statement applies under other
        accounting pronouncements that require or permit fair value measurement,
        FASB
        having previously concluded in those accounting pronouncements that fair
        value
        is the relevant measurement attribute. This statement does not require any
        new
        fair value measurements, however, for some entities, the application of the
        statement will change current practice. This statement is effective for
        financial statements issued for fiscal years beginning after November 15,
        2007,
        and interim periods within those fiscal years. The Company is currently
        reviewing the effect, if any, the proposed guidance will have on its financial
        position.






-13-




**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Notes
        to
        Consolidated Financial Statements
 December
        31, 2006 and 2005 (Restated)


**2.**
              **Summary
                  of Significant Accounting Policies**(cont'd)
  p)
              Recent
                  Accounting Pronouncements (cont'd)
  In
        February 2007, the FASB issued SFAS No. 159, "The Fair Value of Option for
        Financial Assets and Liabilities" ("SFAS No. 159"), which permits entities
        to
        measure many financial instruments and certain other items at fair value
        that
        are not currently required to be measured at fair value. An entity would
        report
        unrealized gains and losses on items for which the fair value option has
        been
        elected in earnings at each subsequent reporting date. The objective is to
        improve financial reporting by providing entities with the opportunity to
        mitigate volatility in reported earnings caused by measuring related assets
        and
        liabilities differently without having to apply complex hedge accounting
        provisions. The decision about whether to elect the fair value option is
        applied
        instrument by instrument, with a few exceptions; the decision is irrevocable;
        and it is applied only to entire instruments and not to portions of instruments.
        The statement requires disclosures that facilitate comparisons (a) between
        entities that choose different measurement attributes for similar assets
        and
        liabilities and (b) between assets and liabilities in the financial statements
        of an entity that selects different measurement attributes for similar assets
        and liabilities. SFAS No. 159 is effective for financial statements issued
        for
        fiscal years beginning after November 15, 2007. Early adoption is permitted
        as
        of the beginning of a fiscal year provided the entity also elects to apply
        the
        provisions of SFAS No. 157. Upon implementation, an entity shall report the
        effect of the first remeasurement to fair value as a cumulative-effect
        adjustment to the opening balance of retained earnings. Since the provisions
        of
        SFAS No. 159 are applied prospectively, any potential impact will depend
        on the
        instruments selected for fair value measurement at the time of implementation.
        The Company is currently evaluating the impact, if any, of the adaption of
        SFAS
        No. 159 will have on its financial position.
  **3.**
              **Restatement
                  of Previously Issued Consolidated Financial
                  Statements**
  a)
              It
                    was determined that the Company inadvertently deferred offering
                    costs
                    relating to an offering finalized in 2005, as well as capitalizing
                    consulting fees that should have been
                    expensed.
  b)
              It
                  was determined the Company had inadvertently excluded the beneficial
                  conversion feature on the $150,000 convertible debt from RE/MAX,
                  and the
                  resulting interest expense.
  c)
              It
                  was determined that $100,000 received by the Company was for the
                  subscription of shares to be issued in
                  March/06.
  d)
              It
                  was determined the Company had inadvertently excluded employee
                  stock-based
                  compensation accruals.






-14-




**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Notes
        to
        Consolidated Financial Statements
 December
        31, 2006 and 2005 (Restated)
  **3.**
              **Restatement
                  of Previously Issued Consolidated Financial Statements**(cont'd)
  The
        effect on the consolidated balance sheet and consolidated statement of
        operations and comprehensive loss for the year ended December 31, 2005 is
        as
        follows:




As
                  PreviouslyReported
              
              Change
              
              Restated**Consolidated Balance Sheet:**Deferred
                  offering costs (a)
              
              $
              30,329
              
              $
              (21,731
              )
              $
              8,598Accounts
                  payable (a) (c)
              
              $
              257,719
              
              $
              (86,123
              )
              $
              171,596Notes
                  payable (b)
              
              $
              150,000
              
              $
              (31,840
              )
              $
              118,160Advances
                  from related party (c)
              
              $
              348,525
              
              $
              (15,660
              )
              $
              332,865Employee
                  stock-based compensation accrual (d)
              
              $
              -
              
              $
              625,911
              
              $
              625,911Additional
                  paid-in capital - warrants (b)
              
              $
              722,611
              
              $
              37,500
              
              $
              760,111Subscription
                  for stock (c)
              
              $
              -
              
              $
              100,000
              
              $
              100,000Accumulated
                  deficit
              
              $
              (660,406
              )
              $
              (643,604
              )
              $
              (1,304,010
              )**Consolidated
                  Statement of Operations and****Comprehensive
                  Loss:**Employee
                  stock-based compensation (d)
              
              $
              -
              
              $
              625,911
              
              $
              625,911Salaries
                  and benefits (a)
              
              $
              311,376
              
              $
              4,128
              
              $
              315,504General
                  and administrative expenses (a)
              
              $
              286,850
              
              $
              7,905
              
              $
              294,755Interest
                  expense - beneficial conversion feature (b)
              
              $
              -
              
              $
              5,660
              
              $
              5,660Net
                  loss
              
              $
              (499,977
              )
              $
              (643,604
              )
              $
              (1,143,581
              )






**4.**
              **Equipment,
                  net**




**Net
                  Book**
              
              Net
                  Book**Accumulated**
              
              **Value**
              
              Value**Cost**
              
              **Depreciation**
              
              **2006**
              
              2005Furniture
                  and equipment
              
              **$**
              **105,906**
              
              **$**
              **22,256**
              
              **$**
              **83,650**
              
              $
              58,442Computer
                  equipment
              
              
              **19,014**
              
              
              **4,093**
              
              
              **14,921**
              
              
              4,144Computer
                  software
              
              
              **-**
              
              
              **-**
              
              
              **-**
              
              
              25,141Leasehold
                  improvements
              
              
              **-**
              
              
              **-**
              
              
              -
              
              
              512**$**
              **124,920**
              
              **$**
              **26,349**
              
              **$**
              **98,571**
              
              $
              88,239






-15-




**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Notes
        to
        Consolidated Financial Statements
 December
        31, 2006 and 2005 (Restated)


**4.**
              **Equipment,
                  net**(cont'd)
  In
        2005,
        the Company initiated the development of a prototype proprietary back office
        software technology branded eXimius. The prototype software was being developed
        to test the viability for automation in the Company’s back office administrative
        areas of mortgage underwriting, commission management, and regulatory
        compliance. The software was not licensed from a third party, but 100%
        internally developed. The Company does not intend to license for use the
        developed prototype software to third parties. Development costs through
        September 2006, consisted primarily of development staff wages and related
        expenses. This investment was capitalized commencing in 2005 after the prototype
        became available for use. In the fourth quarter of 2006, it was determine
        that
        the software was no longer of value to the Company, and was therefore
        written-off.
  **5.**
              **Equipment
                  Under Capital Leases**






**2006**
              
              2005Computer
                  equipment
              
              **$**
              **6,115**
              
              $
              -Less:
                  accumulated depreciation
              
              
              **(917**
              **)**
              
              -**$**
              **5,198**
              
              $
              -




The
        equipment under the capital leases is depreciated on a 30% declining
        balance.
  **6.**
              **Deferred
                  Offering Costs**
  Deferred
        offering costs were recorded in 2005 for two securities offerings and were
        mainly for legal expenses and these offerings are as follows:
  i)
              1,000,000
                  common shares of the Company’s common stock were offered to Mercatus
                  Funding Partners, LLP at a price of $0.63 per share on November
                  1, 2005.
                  Such shares were issued pursuant to an exemption from registration
                  at
                  Section 4(2) of the Securities Act of 1933 and are restricted in
                  accordance with Rule 144 of the Securities Act of
                  1933.
  ii)
              In
                  September 2005, the Company started to work on a security offering
                  to
                  RE/MAX Ontario-Atlantic Canada Inc (“RE/MAX”). A formal Private Placement
                  Memorandum was issued to prospective accredited investor participants
                  on
                  January 31, 2006. The RE/MAX private placement closed on June 12,
                  2006
                  with the sale of 2,112,470 common shares of MortgageBrokers.com
                  Holdings,
                  Inc. at a price of $1.00 per share.
  All
        the
        deferred offering costs were expensed by the end of 2006.






-16-




**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Notes
        to
        Consolidated Financial Statements
 December
        31, 2006 and 2005 (Restated)


**7.**
              **Bank
                  Indebtedness**
  On
          November 22, 2005, the Company obtained a line of credit in the amount
          of
          $128,715. The line of credit bears interest at Royal Bank of Canada's prime
          plus
          0.5% per annum, is unsecured and due on demand and
          is
          secured by a general security agreement in all assets except real
          property .
          At year
          end $30,033 (2005 - $34,137) was available on the line of
          credit.
  **8.**
              **Notes
                  Payable**
  During
        the year ended December 31, 2005, the Company issued an unsecured convertible
        note to RE/MAX Ontario-Atlantic Canada Inc. ("RE/MAX") in the amount of
        $150,000. The $150,000 note is due on the earlier of:
  a)
              the
                  subscription for shares of Company’s common stock (“Shares”) by such
                  executive officers of RE/MAX as RE/MAX shall designate in connection
                  with
                  the proposed private placement of up to 6,000,000 Shares for gross
                  proceeds of up to USD $6,000,000 contemplated to close in early
                  Spring
                  2006; or,
  b)
              the
                  deemed failure to negotiate one or more definitive agreements between
                  RE/MAX and the Company establishing a mortgage origination and
                  referral
                  solution for RE/MAX, the acceptability of such definitive agreement(s),
                  or
                  the failure to negotiate such definitive agreement(s), to be determined
                  by
                  RE/MAX in its sole discretion.
  The
        note
        is non-interest bearing until such time as the note becomes due at which
        point
        it will begin to bear interest at 10% per annum, calculated and compounded
        annually. As of December 31, 2006, there was no accrued interest.
  The
        note
        payable may, at the option of RE/MAX, be converted in whole or in part, on
        a
        one-(1)-Share-for-U.S.$1-basis outstanding. The portion not converted shall
        be
        repayable no later than ten days following the date that RE/MAX notifies
        the
        Company of the exercise of its conversion privilege. The note conversion
        price
        is based on the existing capital structure of the Company and may be adjusted
        in
        the event of a change or reorganization to the capital structure on a pro
        rata
        basis. The note conversion price may also be adjusted in the event of a change
        of more than 95% of the fair market value of the Company stock at the time
        of
        note conversion.
  In
        connection with the issuances of the convertible notes, the Company recorded
        a
        $114,500 discount to the notes to reflect the value of the beneficial conversion
        feature that is amortized as additional non-cash interest expense over the
        term
        of the convertible note. This also resulted in an increase to additional
        paid in
        capital in the amount of $114,500 (comprised of 2006 - $77,000 and 2005 -
        $37,500). The beneficial conversion feature occurred because the conversion
        rate
        of the convertible note was less than the market value of the Company’s common
        stock at the time that the notes were issued. As at December 31, 2005, $5,660
        of
        the discount had been recognized as a non-cash interest expense on the financial
        statements with the remaining $108,840 recognized in 2006 resulting in a
        nil
        discount remaining on the notes.
   -17-
  **MORTGAGEBROKERS.COM
          HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
          MAGNADATA, INC.)**
 Notes
          to
          Consolidated Financial Statements
 December
          31, 2006 and 2005 (Restated)
 **8.**
                **Notes
                    Payable**(cont'd)
  During
          the first quarter of 2006, the Company issued an unsecured convertible
          note to
          Glen Ellen Properties Inc. ("Glen Ellen"), a RE/MAX related party. The
          $100,000
          note payable was due on demand and was non-interest bearing until such
          time as
          the note becomes due at which point it will begin to bear interest at 10%
          per
          annum, calculated and compounded annually.
  During
          the second quarter 2006, the Company completed an offering in which it
          issued a
          total of 2,112,470 shares of its common stock to accredited investors including
          RE/MAX and Glen Ellen at a price per share of $1.00 for an aggregate offering
          price of $2,112,470.
  **9.**
                **Advances
                    from Related Party**
  The
            advances are from the
            majority shareholder/officer
            of the Company and are unsecured, non-interest bearing, and due on
            demand.
  **10.**
                **Trust
                    Liability**
  Pursuant
          to service agreements, a portion of RE/MAX referral fees charged to the
          Company
          will be payable to RE/MAX agents and will be paid into an Registered Retirement
          Savings Plan ("RRSP") account on behalf of the respective agent, administered
          as
          the RE/MAX Agent Retirement Plan by Manulife. The aforementioned fees to
          date
          have been deposited into a temporary trust account that has signing officers
          from both the company & RE/MAX, until the Manulife administered program is
          fully established. It is expected that these funds will be deposited into
          the
          respective agents' RRSP by the third quarter of 2007. As of December 31,
          2006
          $30,320 in referral fees has accumulated in the trust
          account.
   -18-
  **MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Notes
        to
        Consolidated Financial Statements
 December
        31, 2006 and 2005 (Restated)
  **11.**
                **Obligation
                    Under Capital Leases**
  The
          obligation under capital leases bear interest at approximately 30% per
          annum.
          Future minimum lease payments under the capital leases expiring December
          31,
          2009 together with the balance of the obligation under capital leases is
          as
          follows:
  **2006**
                
                20052007
                
                $
                **3,044**
                
                
                -2008
                
                
                **3,044**
                
                
                -2009
                
                
                **1,882**
                
                
                -Total
                    minimum lease payments
                
                
                **7,970**
                
                
                -Less:
                    amount representing interest at approx. 30%
                
                
                **(2,381**
                **)**
                
                -Total
                    obligation under capital leases
                
                
                **5,589**
                
                
                -Less:
                    current portion
                
                
                **(1,674**
                **)**
                
                -Long-term
                    portion
                
                $
                **3,915**
                
                
                -
   **12.**
                **Stock-based
                    Compensation Accrual**
  The
          Company has accrued expenses for stock-based compensation:
  a)
                As
                    of December 31, 2006, the Company accrued a stock-based compensation
                    expense for 136,417 common shares at a price of $0.80 per share
                    for a
                    total of $109,134 to the parties referred to in note 19a, 19b,
                    and 19c(i).
  b)
                As
                    of December 31, 2006, the Company accrued a stock-based compensation
                    expense for 290,102 common shares at a price of $0.80 per share
                    for a
                    total of $232,082 to the parties referred to in note 19c(ii).
  c)
                  During
                        the year, the Company accrued a stock-based compensation
                        expense of
                        $187,939 (2005 - $625,911) under its Equity Compensation
                        Plan referred to
                        in note 13.
  -19-
  **MORTGAGEBROKERS.COM
          HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
          MAGNADATA, INC.)**
 Notes
          to
          Consolidated Financial Statements
 December
          31, 2006 and 2005 (Restated)
  **13.**
                **Capital
                    Stock**
  Preferred
          Stock
  The
          Company has 5,000,000 shares authorized of preferred stock with a par value
          of
          $0.0001. The Company has issued none of these shares as of December 31,
          2006.
  Common
          Stock
  On
          March
          11, 2005, the Company declared a 15:1 forward stock split, resulting in
          28,935,000 shares outstanding with a par value of $.0001. The stock split
          has
          been retroactively reflected in the accompanying consolidated financial
          statements.
  On
          March
          21, 2005, pursuant to a stock purchase agreement and a share exchange between
          the Company and Mortgagebrokers.com Inc. (an Ontario, Canada corporation
          owned
          by the majority shareholder and officer of the Company), the Company received
          all of the outstanding shares of common stock of Mortgagebrokers.com, Inc.
          In
          return, the Company issued 4,000,000 shares of common stock at par value
          of
          $0.0001 to the sole shareholder of Mortgagebrokers.com, Inc. The Company
          accounted for the exchange as a transaction between entities under common
          control and recognized the transfers at their carrying amounts at the date
          of
          transfer.
  On
          September 15, 2005, Elliot Sud subscribed for 100,000 shares of common
          stock at
          $1 per share. Payment for the subscription was received on September 15,
          2006
          ($84,340) and on November 10, 2006 ($15,560). The shares were approved
          by the
          Company for issuance on November 8, 2005 and the 100,000 shares were issued
          on
          March 14, 2006.
  Pursuant
          to a stock purchase agreement dated October 24, 2005, on November 11, 2005
          1,000,000 restricted shares of common stock were issued for cash consideration
          of $0.63 per share or 45% of the market value on the time of free trading
          securities of the Company.
  On
          June
          12, 2006, the Company completed an offering in which it issued a total
          of
          2,112,470 shares of its common stock to accredited investors including
          RE/MAX
          Ontario-Atlantic Canada Inc., its executives and franchisees, at a price
          per
          share of $1.00 for an aggregate offering price of $2,112,470. Purchasers
          of
          these securities receive the following additional rights and
          privileges:
  i)
                  the
                      purchaser received a warrant (1 warrant = 1 share) to further
                      purchase up
                      to the total number shares of common stock purchased through
                      the private
                      placement exercisable at a rate of 20% each year following
                      the anniversary
                      date of the private placement closure. The warrants are exercisable
                      at a
                      price 30% below the 30 day fair market price preceding the
                      date such
                      warrants are exercised. Warrants expire if not exercised within
                      30 days of
                      such anniversary date;
                      and
  -20-


MORTGAGEBROKERS.COM HOLDINGS, INC. AND SUBSIDIARIES
 (FORMERLY MAGNADATA, INC.)
   **13.**
              **Capital
                  Stock**(cont'd)
  ii)
              further,
                  pursuant to the execution of a service level agreement, on the
                  anniversary
                  date of the private placement closure, the Company has agreed to
                  issue a
                  number of shares of common stock equal to 25% of the number of
                  common
                  shares purchased in the private placement for ten consecutive anniversary
                  dates. The receipt of such shares is dependent on the execution
                  and
                  maintenance in good standing of the terms of a service level agreement
                  for
                  each of the ten years. The service level agreement included the
                  provisions
                  of marketing, servicing and promotional
                  services.




On
        September 8, 2006 1,000,000 shares of restricted common stock previously
        issued
        to Mercatus & Partners Funding Limited pursuant to a stock purchase
        agreement for the total net proceeds of $630,000 were recalled and
        cancelled.
  Equity
        Compensation Plan
  On
          February 6, 2003 and as amended on February 14, 2003, the Company adopted
          the
          2003 Equity Compensation Plan to attract and retain high quality personnel.
          The
          adequacy of this plan is evaluated annually by Company management. As of
          December 31, 2006, no stock or options had been issued under this plan.
          The
          disclosures made in the 2005 Audited Financial Statements (10-KSB - Item
          10.
          Executive Compensation) and the ‘Amendment to License Agreement between RE/MAX
          and Mortgagebrokers.com Holding Inc.’ dated May 25, 2006 (8-K - Schedule ‘A’ 1.
          Outstanding Options) documenting the equity compensation of employees has
          not
          been implemented as of April 16, 2007. The company is currently in the
          process
          of amending the existing employment agreements which are expected to be
          executed
          in Q2, 2007. Until the new employment contracts have been formally and
          legally
          executed, the existing employment contracts of the Company are still in
          effect. As
          of
          year end the
          existing employment agreements commit the Company to issuing to staff 936,272
          shares of Company common stock and 81,041 warrants for shares of Common
          Stock for
          a
          stock-based compensation accrual of $813,850 (note 12c).
  Service
        Compensation Plan
  On
        March
        1, 2005 the Board of Directors approved the Service Compensation Plan ("the
        Service Plan"), the purpose of which is to enhance the Company’s stockholder
        value and maximize the available capital resources of the company through
        allowing non monetary transactions whereby the issuance of stock is granted
        for
        services rendered. This program is expected to support the Company in building
        a
        long term sustainable revenue pipeline, a national sales agency and referral
        program as well as provide incentive to service providers to establish long
        term
        relationships with the Company and to encourage stock ownership by such
        individuals by providing them with a means to acquire a proprietary interest
        in
        the Company’s success through stock ownership. Under the Service Plan, service
        providers, consultants, mortgage agents and strategic alliance partners who
        provide services to the Company may be granted options or warrants to acquire
        restricted stock of the Company. The total number of shares reserved for
        issuance under the Service Plan is 5,000,000, the adequacy of which will
        be
        evaluated annually.
   -21-


**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Notes
        to
        Consolidated Financial Statements
 December
        31, 2006 and 2005 (Restated)
  **13.**
              **Capital
                  Stock**(cont'd)
  Non
        Monetary Transactions
  The
        following non monetary transactions were completed by the Company on a service
        for stock basis. It is the Company’s accounting policy that in certain
        circumstances, stock, generally valued at the 5 day moving average price
        of the
        trading value of the stock at the time the associated agreement was executed,
        might be issued for the procurement of assets, provision of advisory and
        other
        services.
  On
        March
        14, 2006, the Company issued 50,000 common shares at a price of $1.80 per
        share
        for total amount of $90,000 to vFinance, Inc. based on the execution of an
        investment banking service agreement. vFinance, Inc. is an arms length third
        party consultant. vFinance Inc. provided advisory services with respect to
        the
        review of financing term sheets and investment banking matters.
  On
        March
        14, 2006 the Company issued 50,000 common shares at a price of $1.80 per
        share
        for total amount of $90,000 to Mr. Elliot Sud based on the execution of advisory
        services.
  On
        March
        14, 2006, the Company issued 100,000 common shares divided equally amongst
        Ms.
        Sharon Oakes and Mr. Ron Stanners for certain office equipment, cash, the
        proceeds from work in progress and office supplies acquired valued at $58,801
        from Lending Source Canada Inc.
  On
        March
        14, 2006, the Company issued 5,000 common shares at a price of $1.80 per
        share
        for a total amount of $9,000 to Ms. Nicole Locking pursuant to the execution
        and
        termination of an employment agreement.
  On
        March
        14, 2006, the Company issued 100,000 common shares at a price of $1.80 per
        share
        for a total amount of $180,000 to Mr. Mark Lindsay based on the execution
        of an
        advisory and consulting agreement.
  On
        March
        14, 2006, the Company issued 25,000 common shares at a price of $1.80 per
        share
        for a total amount of $45,000 to Mr. Mike Fearnow pursuant to the execution
        of
        an advisory services agreement.
  On
        March
        14, 2006, the Company issued 15,000 common shares at a price of $1.80 per
        share
        for a total amount of $27,000 to Mr. Attilio Lombardi care of NCP Computers
        Inc.
        pursuant to the provision of information systems and technology
        services.
  On
        April
        25, 2006, the Company issued 500,000 common shares to Lendiem Corporation
        (a
        related party to Trisan Corporation) and Vito Galloro. These shares were
        issued
        by mistake and the Company is working on canceling these
        shares.






-22-




**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Notes
        to
        Consolidated Financial Statements
 December
        31, 2006 and 2005 (Restated)
  **13.**
              **Capital
                  Stock**(cont'd)
  On
        April
        25, 2006, the Company issued 500,000 common shares. Theses shares were issued
        in
        error and were cancelled on August 8, 2006.
  On
        October 30, 2006, the Company issued 48,000 common shares at a price of $0.53
        per share for a total amount of $25,440 to Stockdaily.com pursuant to the
        execution of an advisory services agreement.
  On
        October 30, 2006, the Company issued 48,000 common shares at a price of $0.53
        per share for a total amount of $25,440 to Max Communications, Inc. pursuant
        to
        the execution of an advisory services agreement.
  **14.**
              **Additional
                  Paid-in Capital - Warrants**
  During
        June 2006, RE/MAX purchased 2,112,470 units of the Company for aggregate
        proceeds of $2,112,470 as a part of private placement (note 13). Each unit
        consisted of one common share and one common share purchase warrant. The
        warrants are exercisable at a price 30% below the 30 day fair market price
        preceding the date such warrants are exercised. One-fifth of such warrants
        must
        be exercised (executed to purchase shares) within 30 days following each
        successive anniversary date of the private placement closing of the offering.
        Warrants expire if not exercised within 30 days of such anniversary date.
        The
        warrants were relatively valued at $732,605. The fair value of the warrants
        was
        estimated using the Black-Scholes option-pricing model with the following
        weighted average assumptions: expected dividend yield of 0%, expected stock
        volatility of 64.7%, risk-free interest rate of 4.00% and an expected warrant
        life of 1 year.
  **15.**
              **Subscription
                  Receivable**
  On
        October 24th, 2005, the Company approved the issuance of 1,000,000 shares
        of
        restricted common stock to Mercatus & Partners Funding Limited pursuant to a
        stock purchase agreement for the total net proceeds of $630,000 to be paid
        to
        the Company in December, 2005. On June 18, 2006, correspondence was directed
        to
        Mercatus informing them of the Company’s decision to cancel this transaction and
        formally requesting the 1,000,000 shares of Company stock to be returned.
        The
        common shares were recalled and cancelled officially on September 8,
        2006.
  On
        June
        12, 2006, the Company completed an offering in which it issued a total of
        2,112,470 shares of its common stock to accredited investors including RE/MAX
        Ontario-Atlantic Canada Inc., its executives and franchisees, at a price
        per
        share of $1.00 for an aggregate offering price of $2,112,470. Payment of
        $1,877,470 was received as of December 31, 2006 and promissory notes were
        executed for a balance of $235,000. These notes are due on June 1,
        2007.






-23-




**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Notes
        to
        Consolidated Financial Statements
 December
        31, 2006 and 2005 (Restated)
  **16.**
              **Treasury
                  Stock**
  The
        Company acquired 31,600 common shares of the Company during the last quarter
        of
        the December 31, 2006 at an average value of $0.56 per common share, for
        a total
        of $17,779.
  **17.**
              **Occupancy
                  Costs - Related Party**
  On
          February 1, 2005, the Company agreed to sublease, on a month to month basis,
          the
          office previously occupied by a company under common control. All lease
          payments
          were paid directly to the lessor, who is an arms length party. This lease
          was
          completed in August 2006.
  For
        the
        period of September 2006 to December 2006, the Company operated from a property
        owned by a related party and did not incur any rent expenses during this
        period.
  **18.**
              **Income
                  Taxes**
  The
            Company has paid no federal or state income taxes. As of December 31,
            2006, the
            Company had net operating loss carry forwards for federal income tax
            reporting
            purposes of $2,198,909 which, if unused, will expire in various years.
            The tax
            effect of the operating loss carry forwards and temporary differences
            at
            December 31, 2006 and 2005 are as follows:
 **2006**
                
                2005Deferred
                    Income
                    Tax Assets:Operating
                    loss
                    carry forward
                
                **$**
                **747,629**
                
                $
                221,730Valuation
                    allowance
                
                
                **(747,629**
                **)**
                
                (221,730
                )Total
                    deferred tax effect
                
                **$**
                **-**
                
                $
                -


The
        following is a reconciliation
        of the income tax benefit computed using the federal statutory rate to the
        provision for income taxes:


**2006**
              
              2005Deferred
                  Tax Provision:Benefit
                  at Federal statutory rate (34%)
              
              **$**
              **747,629**
              
              $
              221,730Change
                  in valuation allowance
              
              
              **(747,629**
              **)**
              
              (221,730
              )Provision
                  for income taxes
              
              **$**
              **-**
              
              $
              -Current
                  Tax Provision:Federal
                  and State income tax
              
              **$**
              **-**
              
              $
              -






-24-




**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Notes
        to
        Consolidated Financial Statements
 December
        31, 2006 and 2005 (Restated)


**19.**
              **Commitments
                  and Contingencies**
  Commitments
  The
        Company has entered into agreements with various parties, whereby the Company
        is
        committed to issue compensatory warrants and stock as part of the “Service
        Compensation Plan” to mortgage agents and strategic alliance
        partners.
  The
          effective date (“Effective Date”), when mentioned below, is the date the
          independent mortgage agent entered into a Mortgage Agent Agreement with
          the
          Company; or, is the date the RE/MAX Ontario-Atlantic Canada Inc. (“RE/MAX”) or
          Maxwell Realty Inc. (“Maxwell”) Franchisee entered into a Service Level
          Agreement with the Company and is also the date that the strike price (“Strike
          Price”) of the warrants is established. The strike price is the greater of $1
          per share or the twenty day average closing price following the Effective
          Date.
  Since
        the
        conversion ratio of dollar value of warrants into shares is fixed, but the
        share
        price fluctuates, the accrual to expense the value of the warrants earned
        by the
        mortgage agents and strategic alliance partners will fluctuate with the share
        price at the end of each period.
  The
        Company has entered into agreements with the following parties:
  a)
              Independent
                  Mortgage Agents/Loan Officers
  Pursuant
        to a 5 year Mortgage Agent Agreement, the Company is committed to issuing
        warrants, at no cost, for common stock of the Company in two series to mortgage
        agents licensed with the Company based on their annual mortgage origination
        sales volume, which are summarized as follows based on current
        formulae:
  Series
        I
        Warrants
  “Average
                  Volume”:
              defined
                  as the average best three out of five years in funded mortgage
                  origination
                  volume
 Number
                  of Warrants:
              $8,257
                    worth of warrants divided by the Strike Price, per CDN $10 ($8.58
                    USD)
                    million in Average Volume, adjusted on a pro rata basis, no minimum
                    or
                    maximum thresholds.The warrants are convertible in common
                  shares on a 1:1 basis.
 Earnings
                  Period:
              Series
                  I warrants are earned in the first 5 years following the Effective
                  Date;
 Additional
                  Vestment:
              all
                  SERIES I warrants are fully vested on the 5th anniversary of the
                  Effective
                  Date Determination Date:
              5 year anniversary of Effective
                Date
  
 -25-




**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Notes
        to
        Consolidated Financial Statements
 December
        31, 2006 and 2005 (Restated)
  **19**
              **Commitments
                  and Contingencies**(cont'd)
  Commitments
          (cont’d)
  a)
              Independent
                  Mortgage Agents/Loan Officers
                  (cont'd)
  Series
        II
        Warrants
  “Annual
                  Volume”:
              defined
                  as the total mortgage origination volume executed per 12 month
                  period
                  following the Effective Date and subsequent 12 month periods following
                  the
                  anniversary dates of the Effective
                  Date
 Number
                  of Warrants:
              $1,651
                    worth of warrants divided by the Strike Price per CDN $10($8.58
                    USD)million
                    in Annual Volume, adjusted on a pro rata basis, no minimum or
                    maximum
                    thresholds.The warrants are convertible in common shares on
                  a 1:1 basis.
 Earnings
                  Period:
              Series
                  II warrants are earned in the first 5 years following the Effective
                  Date
 Additional
                  Vestment:
              All
                  SERIES II Warrants fully vest 3 years following the Determination
                  Date
 Determination
                  Date:
              The
                  Annual Volume is determined on the fifth year anniversary of the
                  Effective
                  Date
  b)
                Maxwell
                    Realty Inc.
 Per
        a
        three year renewable agreement dated April 12, 2006 and pursuant to the
        execution of a service level agreement by the Maxwell Franchisee, the Company
        is
        committed to issuing to Maxwell at no cost, warrants for common stock of
        the
        Company based on referrals leading to funded mortgage origination volume.
        The
        Maxwell Warrant-Based Compensation Program, which issues warrants (“SERIES III
        Warrants”) that are divided amongst the Maxwell Franchisor, Franchisee and
        referring Sales Agent.
  Annual
                  Volume:
              defined
                  as the total funded mortgage origination volume from Maxwell lead
                  referral
                  executed per 12 month period following the Effective Date and subsequent
                  12 month periods following the anniversary dates of the Effective
                  Date
 Number
                  of Warrants:
              $3,000
                    worth of warrants divided by the Strike Price per CDN $10($8.58
                    USD)million
                    in Annual Volume, adjusted on a pro rata basis, no minimum or
                    maximum
                    thresholds.The warrants are convertible in common shares on
                  a 1:1 basis.
 Earnings
                  Period:
              Series
                  III warrants are earned in the first 5 years following the Effective
                  Date Additional Vestment:
              SERIES
                III warrants are fully vested on the fifth anniversary of the Effective
                Date




-26-




**MORTGAGEBROKERS.COM
      HOLDINGS, INC. AND SUBSIDIARIES**


**(FORMERLY
      MAGNADATA, INC.)**


Notes
      to
      Consolidated Financial Statements


December
      31, 2006 and 2005 (Restated)


**19**
              **Commitments
                  and Contingencies**(cont'd)
  Commitments
          (cont’d)
  c)
              RE/MAX
  i)
              Pursuant
                  to a ten year licensing agreement dated January 30, 2006 and amended
                  May
                  25, 2006, and pursuant to the execution of a one year renewable
                  service
                  level agreement by the RE/MAX Franchisee, the Company is committed
                  to
                  issuing to RE/MAX at no cost, warrants for common stock of the
                  Company
                  based on referrals leading to funded mortgage origination volume.
                  The
                  RE/MAX Warrant-Based Compensation Program issues warrants (“SERIES IV
                  Warrants”) as follows based on current
                  formulae:
  Annual
                  Volume:
              defined
                  as the total funded mortgage origination volume from RE/MAX lead
                  referral
                  executed per 12 month period following the Effective Date and subsequent
                  12 month periods following the anniversary dates of the Effective
                  Date
 Number
                  of Warrants:
              $3,000
                    worth of warrants divided by the Strike Price per $10 million
                    dollars CDN
                    in Annual Volume, adjusted on a pro rata basis, no minimum or
                    maximum
                    thresholds.The warrants are convertible in common shares on
                  a 1:1 basis.
 Earnings
                  Period:
              Series
                  IV warrants are earned in the first 3 years following the Effective
                  Date
 Additional
                  Vestment:
              SERIES
                  IV warrants are fully vested on the 5th anniversary of the Effective
                  Date
  ii)
              Pursuant
                  to the ten year licensing agreement dated January 30, 2006 and
                  amended May
                  25, 2006, the Company has committed to issuing, at no cost, an
                  aggregate
                  of 528,118 common shares of the Company on each of the 10 year
                  anniversary
                  dates of the licensing agreement to those RE/MAX executives and
                  franchisees that participated in the company’s private placement which
                  closed on June 12, 2006.
  d)
                The
                    Company has signed lease agreements for computer equipment. Committed
                    future payments are as follows:
  2007
                  
                  $
                  12,3472008
                  
                  $
                  1,716
   -27-




**MORTGAGEBROKERS.COM
      HOLDINGS, INC. AND SUBSIDIARIES**


**(FORMERLY
      MAGNADATA, INC.)**


Notes
      to
      Consolidated Financial Statements


December
      31, 2006 and 2005 (Restated)


**19**
              **Commitments
                  and Contingencies**(cont'd)
  Contingencies
  Trisan
            Equitable Corporation ("TRISAN") commenced an action in October 2006
            in Ontario,
            Canada against several parties including MortgageBrokers.com Holdings,
            Inc. The
            statement of claim is for an aggregate payment of approximately $1.3
            MM plus
            applicable interest related to a financing agreement. The Company plans
            to
            vigorously defend itself in this claim and has launched a counter suit
            in
            Ontario Superior Court against TRISAN and related parties in the amount
            of $4.8
            MM. Legal counsel for the Company at this time estimate that this claim
            maybe a
            reasonably possible contingent liability for the Company of up to $520,000
            plus
            applicable interest. At the present time, the Company and its legal counsel
            agree that the outcome of this proceeding cannot be reasonably determined
            at
            this time.
 Trisan
          is
          claiming against all of the defendants, the
          principal sum of $598,636
          CDN ($513,689
          USD) ;
          $33,752
          CDN ($28,963
          USD) for
          legal
          fees; pre-judgment interest on such sum at 10% per annum calculated from
          June
          26, 2005 to the date of payment; $10,000 CDN for a loan commitment fee;
          damages
          of $750,000 CDN; and pre- and post-judgment interest and its legal
          costs.
 Trisan
          is
          also claiming, against all of the defendants, that 1,505,000 shares of
          MagnaData, or its successor (which is the Company), be delivered up to
          an escrow
          agent as a result of an escrow agreement dated January 2005, which was
          entered
          into as security for repayment of the loan.
  No
          amount
          has been accrued in the Company’s financial statements at year end as the
          outcome of the claim can not be reasonably determined.
  The
        defendants to Trisan’s action, with one exception, have counterclaimed against
        Trisan and its principals for $5,500,000 CDN($4,719,550
        USD).
  **20.**
              **Subsequent
                  Events**
 a)
                The
                    Company entered into a financial public relations agreement with
                    SmallCapVoice.com, Inc. on January 3, 2007. The services provided
                    to the
                    Company during the three month term of the agreement include
                    public
                    relations, press release distribution, a feature of the Company
                    or
                    internet audio broadcasts and interviews and to prepare and distribute
                    a
                    monthly Company newsletter. In consideration for this service,
                    the Company
                    issued 10,000 common shares of restricted stock of the Company
                    to
                    SmallCapVoice.com, Inc. on January 8,
                    2007.




-28-




**MORTGAGEBROKERS.COM
        HOLDINGS, INC. AND SUBSIDIARIES**
 **(FORMERLY
        MAGNADATA, INC.)**
 Notes
        to
        Consolidated Financial Statements
 December
        31, 2006 and 2005 (Restated)
  **20.**
              **Subsequent
                  Events**(cont'd)
  b)
              On
                  February 8, 2007, the Company entered into a lease to rent office
                  space in
                  Calgary, Alberta, Canada for maintaining the Company’s western Canada
                  operations. The agreement is effective commencing May 1, 2007 for
                  a five
                  year term.
  Future
        minimum lease payments (excluding utilities, taxes and common area maintenance
        expenses) are as follows:




2007
              
              $
              5,0402008
              
              $
              7,5602009
              
              $
              7,5602010
              
              $
              8,5682011
              
              $
              9,072Thereafter
              
              $
              3,024




c)
              On
                  March 27, 2007, the Company entered into a lease to rent office
                  space in
                  Toronto, Ontario, Canada for maintaining the Company’s Canadian head
                  office. The agreement is effective commencing April 1, 2007 for
                  a two year
                  term.
  The
                  Company has the option to renew this lease, for amounts to be determined,
                  for two additional one year terms. The Company also has the option
                  to
                  purchase the office space, by May 31, 2007, for
                  $986,815.
 Future
                      minimum lease payments (excluding utilities, taxes and common
                      area
                      maintenance expenses) are as
                      follows:
 2007
                
                $
                72,2692008
                
                $
                96,3592009
                
                $
                24,090


**21.**
              **Comparative
                  Figures**
  Certain
        figures for
        the year period have been reclassified to conform with the current year’s
        financial statement presentation.






-29-








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




On
      May
      10, 2005, Hansen, Barnett & Maxwell, PC was dismissed as our independent
      auditor and Jewett Schwartz & Associates (“Jewett Schwartz”) was engaged as
      our principal independent accountant. On September 21, 2005, Jewett Schwartz
      & Associates was dismissed as our independent auditor and SF Partnership,
      LLP was engaged as our principal independent accountant. We do not presently
      intend to change accountants. At no time has there been any disagreements with
      either Hansen, Barnett & Maxwell, PC, Jewett Schwartz & Associates, or
      SF Partnership, LLP regarding any matter of accounting principles or practices,
      financial statement disclosure, or auditing scope or procedure.




**ITEM
      8A. CONTROLS AND PROCEDURES**




Evaluation
      of disclosure controls and procedures




Alex
      Haditaghi, our principal executive officer and principal financial officer
      evaluated our disclosure controls and procedures (as defined in rule 13a-14(c)
      and 15d-14(c) under the Securities Exchange Act of 1934, as amended) as of
      a
      date within 90 days before the filing of this annual report (the Evaluation
      Date). Based on that evaluation, our principal executive officer and principal
      financial officer concluded that, as of the Evaluation Date, the disclosure
      controls and procedures in place were adequate to ensure that information
      required to be disclosed by us, including our consolidated subsidiaries, in
      reports that we file or submit under the Exchange Act, is recorded, processed,
      summarized and reported on a timely basis in accordance with applicable rules
      and regulations. Although our principal executive officer and principal
      financial officer believes our existing disclosure controls and procedures
      are
      adequate to enable us to comply with our disclosure obligations, we intend
      to
      formalize and document the procedures already in place and establish a
      disclosure committee.




Changes
      in internal controls




We
      have
      not made any significant changes to our internal controls subsequent to the
      Evaluation Date. We have not identified any significant deficiencies or material
      weaknesses or other factors that could significantly affect these controls,
      and
      therefore, no corrective action was taken.




16


**PART
      III**




**ITEM
      9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS: COMPLIANCE
      WITH
      SECTION 16(A) OF THE EXCHANGE ACT**




The
      following table sets forth, as of April 17, 2007, the names and ages of all
      of
      our directors and executive officers; and all positions and offices held. The
      director will hold such office until the next annual meeting of shareholders
      and
      until his or her successor has been elected and qualified.




Name
            Age
            PositionAlex
                Haditaghi
            34
            President,
                CEO, CFO and Chairman of the Board







**Family
      Relationships**




No
      family
      relationship has ever existed between any director, executive officer of the
      company, or any person contemplated to become such.




**Business
      Experience**




The
      following summarizes the occupation and business experience during the past
      ten
      years for our officers and directors:




**Alex
      Haditaghi, President, Chief Executive Officer, Chief Financial Officer and
      Chairman of the Board of Directors**




Alex
      Haditaghi has been working in the mortgage industry in Canada since 1999 and
      has
      extensive experience in both residential and commercial mortgages. He has worked
      with some of the top financial institutions in the country and has developed
      solid relationships with leading private and institutional mortgage brokers
      and
      lenders. An entrepreneur at heart, Mr. Haditaghi founded Infosoft Media, an
      e-commerce information company, where he saw the company clientele grow to
      over
      200 large and medium companies. Realizing a need for an online mortgage
      brokerage in Canada, Mr. Haditaghi formed Lending Tree Canada in 2000. He
      served as CEO and President for five years until he founded MortgageBrokers.com
      in January 2005. Today, as CEO of MortgageBrokers.com, Mr. Haditaghi is
      responsible for the business vision, expansion, resourcing and providing overall
      leadership.




The
      following individuals are not officers or directors of Mortgagebrokers.com
      but
      are key members of our management team:




**Dong
      Lee, Executive Vice President of Operations**




As
      Vice
      President of Operations, Mortgage Broker Division for Mortgagebrokers.com,
      Dong
      Lee brings expertise in both the mortgage financing and banking sectors. In
      his
      role as Senior Manager-Alternate Delivery Channels, for Scotiabank, Lee oversaw
      the strategic development of both Scotiabank’s mobile mortgage sales team and
      mortgage broker delivery channels. In this position, Lee was responsible for
      the
      strategic marketing and development of sales programs.




Before
      joining ScotiaBank, Lee spent several years as the Business Development Officer
      for the Canada Mortgage & Housing Corporation (CMHC), where he managed and
      grew the market share of CMHC’s largest lender portfolio. Before specializing in
      the mortgage sector, Lee spent several years with TD Bank Financial group as
      Manager of Korean banking. Under that position, Lee envisioned, launched and
      managed the Korean Banking Centre, establishing a multi million dollar referral
      network with several of the largest banks in Korea.




A
      graduate from Queen’s University’s Business program, Lee is currently completing
      his MBA through Dalhousie University. During his time at Queen’s, Lee studied
      international business at Herstmonceux Castle in Hailsham England.




17


**Robert
      Hyde, Executive Vice President of Finance &
Administration**




Mr. Hyde
      joins MortgageBrokers.com following a 17 year career in the engineering,
      software and venture capital industries servicing the real estate, financial
      services and petrochemical industries with significant business building
      experience and leadership roles in Canada, the US, and the EU. Most recently,
      Robert was Managing Director of Paladin Capital Ventures. Paladin Capital
      Ventures provides early stage technology based companies/divisions/
      entrepreneurial subsidiaries with business model development, strategic
      planning, finance and capital planning, facilitating Venture Capital and Private
      Placement, and providing strategic market planning services. Prior to this,
      Robert was the founder and managing director of eRealVantage Incorporated,
      a
      real estate investment portfolio securitization technology company servicing
      the
      REIT and pension fund portfolio market place. Prior to this, he was President
      of
      Enviro Cheq Corporation and Vice President of the knowledge-based risk
      management company, Trillium Environmental Corporation.




A
      resident of Toronto, Mr. Hyde graduated from the Richard Ivey School of
      Business, University of Western Ontario (MBA) in 2003 and received his Masters
      of Engineering degree from University of Windsor in 1990. He is a Professional
      Engineer in the Province of Ontario and has completed numerous executive
      training courses including the Art of Negotiation. He is currently completing
      his CFA designation. His charity work over the past 7 years has focused on
      the
      teaching of disabled children the sport of downhill ski through the Track3
      Organization of Canada.




**Matthew
      Laverty, Vice President of Sales - Eastern Canada**




Prior
      to
      joining MortgageBrokers.com, Mr. Laverty was based in Ottawa as Regional
      Sales Director, Eastern Ontario and Atlantic Canada for Mortgage Intelligence
      Inc., a GMAC company. Prior to that, Mr. Laverty spent 10 years in various
      sales, marketing and management roles at Americredit Financial Services,
      Canadian Imperial Bank of Commerce (CIBC) and The Associates Financial Services
      of Canada.




As
      Regional Director at Mortgage Intelligence, Mr. Laverty was responsible for
      the recruitment, management and revenue generation of over 130 mortgage
      consultants. Some of his most notable accomplishments include in excess of
      50%
      mortgage origination market share amongst mortgage brokers in the Ottawa region
      and year over year sales growth of 300%.




Mr. Laverty’s
      role at MortgageBrokers.com is to lead the execution of our Mortgage Broker
      Channel Acquisition Sales plan across Eastern Canada. He has an excellent
      industry reputation and will be leading our acquisition strategy, establishing
      our national network of mortgage broker managing partners.




**Dave
      Mercer, Vice President of Sales - Western Canada**




Prior
      to
      joining MortgageBrokers.com, Mr. Mercer, a 23 year veteran of the real
      estate and mortgage broker industry, was President of Lending Source Canada
      Inc.
      Previously, Mr. Mercer spent 4 years as a top producing regional manager
      for The Mortgage Alliance Company of Canada, who today claims to be the largest
      independent mortgage originator in Canada. Through his career in the industry,
      Mr. Mercer has been responsible for the recruitment, training and
      mentorship of over 300 Mortgage Brokers across Canada.




Mr. Mercer
      has also served as President of the Alberta Mortgage Brokers Association (AMBA),
      and for many years served as the Chair for the Communications and Ethics
      committees. Mr. Mercer also currently teaches for the Alberta Real Estate
      Association (AREA) through Mt. Royal College.




Mr. Mercer
      will be responsible for introducing MortgageBrokers.com’s value proposition to
      Mortgage Brokers across the country through executing the company’s ‘Broker
      Channel Acquisition Program’. Through this program, MortgageBrokers.com will be
      offering Mortgage Brokers equity ownership in a public company in exchange
      for
      their origination volume. In addition, Mr. Mercer will be focusing on
      expanding the company’s product offering to strengthen the sustainability of
      MortgageBrokers.com’s business model, while further legitimizing the
      broker  channel
      as a first choice for financing. Through ongoing diversification of the
      company’s product offerings and associated revenue streams, Mr. Mercer will
      help the executive management team build sustainable Mortgage Broker Partner
      commissionable earnings, especially in an unstable and rising interest rate
      environment.




18


**CERTAIN
      LEGAL PROCEEDINGS**




No
      director, nominee for director, or executive officer has appeared as a party
      in
      any legal proceeding material to an evaluation of his ability or integrity
      during the past five years.




**COMPLIANCE
      WITH SECTION 16(A) OF THE EXCHANGE ACT**




We
      have
      not filed a Form 5 for the year ending December 31, 2006.




**CODE
      OF ETHICS**




The
      company has adopted a Code of Ethics applicable to its Chief Executive Officer
      and Chief Financial Officer. This Code of Ethics is filed herewith as an
      exhibit.




**ITEM
      10. EXECUTIVE COMPENSATION**




Members
        of the Board of Directors and members of the management team presently have
        employment agreements with us. These employment agreements are presently
        being
        re-negotiated. The
        disclosures made in the 2005 Audited Financial Statements (10-KSB - Item
        10.
        Executive Compensation) and the ‘Amendment to License Agreement between RE/MAX
        and Mortgagebrokers.com Holding Inc.’ dated May 25, 2006 (8-K - Schedule ‘A’ 1.
        Outstanding Options) documenting the equity compensation of employees has
        not
        been implemented as of April 16, 2007. The company is currently in the process
        of amending the existing employment agreements which are expected to be executed
        in the second quarter of 2007. Until the new employment contracts have been
        formally and legally executed, the existing employment contracts of the Company
        are still in effect. The
        agreed upon compensation terms were disclosed in our 2005 Annual Report on
        Form
        10-KSB.
  The
        following summarizes the Companies senior management compensation:
  **SUMMARY
                    COMPENSATION TABLE (For Alex & Executives who Earned > $100K in
                    2006)**Name
                    and principal position
                  (a)
                Year
                  (b)
                Salary
                    ($)
                  (c)
                Bonus
                    ($)
                  (d)
                Stock
                    Awards ($)
                Option
                    Awards ($)
                Non-Equity
                    Incentive Plan Compensation ($)
                Nonqualified
                    Deferred Compensation Earnings ($)
                All
                    Other Compensation ($)
                Total
                    ($)**Alex
                    Haditaghi, Chairman and CEO**
                2006
                $87,719.56
                0
                0
                0
                0
                0
                0
                $87,719.562005
                0
                0
                0
                0
                0
                0
                0
                02004
                N/A
                N/A
                N/A
                N/A
                N/A
                N/A
                N/A
                0**Dong
                    Lee, VP, Operations**
                2006
                $113,543.20
                0
                0
                0
                0
                0
                0
                $113,543.20**Robert
                    Hyde, VP, Finance**
                2006
                $108,135.99
                0
                0
                0
                0
                0
                0
                $108,135.99**Matt
                    Laverty, VP, Sales**
                2006
                $97,323.74
                0
                0
                0
                0
                0
                0
                $97,323,74
  **Directors**
  Directors
          serve for a term of one year and stand for election at our annual meeting
          of
          stockholders. Pursuant to our Bylaws, a majority of directors may appoint
          a
          successor to fill any vacancy on the Board of Directors.
  **Committees**
  The
          Board
          of Directors has set up committees as part of the compliance with new reporting
          regulations that were enacted under the Oxley-Sarbanes Act. The following
          is a
          list of committees that are presently active and staffed by independent
          directors of the company.
   19
  **COMMITTEE**
                **MEMBERS**Audit
                    Committee
                NoneCompensation
                    Committee
                None
  The
          Board
          of Directors has yet to determine its Audit Committee financial expert,
          which
          such expert is required to be “independent” under the Securities Exchange Act of
          1934, as amended.
  **Compliance
          With Section 16(a) Of The Securities Act Of 1934**
  Section
          16(a) of the Securities Exchange Act of 1934 requires our directors and
          executive officers, and persons who own more than 10% of a registered class
          of
          our equity securities to file with the Securities and Exchange commission
          initial reports of ownership and reports of changes in ownership of common
          stock
          and other of our equity securities. Officers, directors and greater than
          10%
          shareholders are required by SEC regulations to furnish us copies of all
          Section
          16(a) forms they file.
  Based
          on
          available information, we believe that all filings with respect to Section
          16(a)
          are current.
  **Options**
 
 The
          following table contains information regarding options granted during the
          year
          ended December 31, 2006 to our named executive officers.
  **OPTIONS
          GRANT TABLE**
 **NAME**
                **NO.
                    OF SECURITIES UNDERLYING OPTIONS/SAR’S GRANTED**
                  **(#)**
                **%
                    TOTAL OPTIONS/SAR’S GRANTED TO EMPLOYEES IN YEAR ENDED DECEMBER 31, 2006**
                  **(%)**
                **EXERCISE
                    OR BASE PRICE**
                  **($
                    PER SHARE)**
                **EXPIRATION
                    DATE**Alex
                    Haditaghi
                --
                --
                --
                --President,
                    CEO, CFO and Director
  The
          following table contains information regarding options exercised in the
          year
          ended December 31, 2006, and the number of shares of common stock underlying
          options held as of December 31, 2006, by Americana’s named executive
          officers.
  **AGGREGATED
          OPTIONS/SAR EXERCISES**
 **IN
          LAST FISCAL YEAR AND**
 **FISCAL
          YEAR END OPTIONS/SAR VALUES**
 **Stock
          Option Grants In The Past Fiscal Year**
  We
          have
          not issued any grants of stock options in the past fiscal year to any officer
          or
          director.
   20


**ITEM
      11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
      MANAGEMENT**




Name
                of Beneficial Owner (2)
            Number
                of Total Shares
            Percent
                of class (***1***)Alex
                Haditaghi
            25,734,000
            75.83%All
                executive officers
              
              and
                directors as a group
            25,734,000
            75.83%





***(1)
        Based on 36,088,470 shares of common stock issued and outstanding as of December
        31, 2006.***


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




We
      will
      present all possible transactions between us and our officers, directors or
      5%
      stockholders, and our affiliates to the board of directors for our consideration
      and approval. Any such transaction will require approval by a majority of the
      disinterested directors and such transactions will be on terms no less favorable
      than those available to disinterested third parties.




Except
      as
      disclosed below, none of the following persons has any direct or indirect
      material interest in any transaction to which we are a party since our
      incorporation or in any proposed transaction to which we are proposed to be
      a
      party:




(A)
            Any
                of our directors or officers;(B)
            Any
                proposed nominee for election as our director;(C)
            Any
                person who beneficially owns, directly or indirectly, shares carrying
                more
                than 10% of the voting rights attached to our Common Stock;
                or(D)
            Any
                relative or spouse of any of the foregoing persons, or any relative
                of
                such spouse, who has the same house as such person or who is a director
                or
                officer of any parent or subsidiary of our
                company.




On
        February 1, 2005, the Company agreed to sublease, on a month to month basis,
        the
        office previously occupied by a company under common control. All lease payments
        were paid directly to the lessor, who is an arms length party. This lease
        was
        completed in August 2006.
  For
        the
        period of September 2006 to December 2006, the Company operated from a property
        owned by a related party and did not incur any rent expenses during this
        period.
 
 Alex
        Haditaghi, our President and Chief Executive Officer, advanced the Company
        $204,868 in 2006. Such advances are unsecured, non-interest bearing, and
        due on
        demand.




**ITEM
      13. EXHIBITS AND REPORTS ON FORM 8-K**




(a)
              The
                  following documents are filed as part of this report:1.
              Financial
                  statements; see index to financial statements and schedules In
                  Item 7
                  herein.2.
              Financial
                  statement schedules; see index to financial statements and schedules
                  in
                  Item 7 herein.3.
              Exhibits:




The
      following exhibits are filed with this Form 10-KSB and are identified by the
      numbers indicated; see index to exhibits immediately following financial
      statements and schedules of this report:






21




3.1
              Articles
                  of Incorporation (1)3.2
              Description
                  ofSubsidiaries
                  of MortgageBrokers.com Holdings, Inc.Subsidiaries




In
      accordance to Item 601 (b)(21) of Regulation s-B:




MortgageBrokers.com
      Inc.




Ontario
      Provincial Corporation: Ontario Corporation Number 1645394




Incorporated
      January 19, 2005




Ownership:




Class
      A
      Shares (Ownership shares): 100 % owned by MortgageBrokers.com Holdings
      inc.




Class
      B
      Shares (Voting): 75% Owned by Alex Haditaghi to comply with Canadian Provincial
      Mortgage Broker Acts.




MortgageBrokers.com
      Financial Group of Companies Inc.




Canada
      Federal Corporation No. 645377-5




Incorporated:
      September 26, 2005




Ownership:




Class
      A
      Shares (Ownership shares): 100 % owned by MortgageBrokers.com Holdings inc.




Class
      B
      Shares (Voting): 75% Owned by Alex Haditaghi to comply with Canadian Provincial
      Mortgage Broker Acts.




3.3
              By-laws
                  (1)




(1)
      Incorporated by reference to our Form SB-2 (SEC File No.
      333-117718).




(b)
                  Reports
                        of Form 8-K filed in fourth quarter of the fiscal
                        year:


On
        December 21, 2006, Company filed a Form 8-K regarding the restatement of
        our
        2005 year end audit and 2006 Q1, 2006 Q2, 2006 Q3 financial
        statements.




22




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




Audit
        Fees
  For
        the
        Company’s fiscal year ended December 31, 2006 and 2005, we were billed
        approximately $70,000 and $19,500 for professional services rendered for
        the
        audit and reviews of our financial statements.
  Tax
        Fees
  For
        the
        Company’s fiscal year ended December 31, 2006 and 2005, we did not incur any
        fees for professional services rendered for tax compliance, tax advice, and
        tax
        planning.
  All
        Other
        Fees
  The
        Company was billed approximately $70,000 in fees related to accounting and
        audit
        services rendered by our principal accountant for the fiscal year ended December
        31 st ,
        2006 to
        restate our financials for the 2005 year end, and 2006 first, second and
        third
        quarters.


23


**SIGNATURES**




Pursuant
      to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
      1934, the registrant has duly caused this report to be signed on its behalf
      by
      the undersigned, there unto duly authorized.




**MORTGAGEBROKERS.COM
                HOLDINGS, INC.**




By:*/s/
                  Alex Haditaghi*Alex HaditaghiPresident, Secretary and
                  Director




Dated:
      April 17, 2007





Pursuant
      to the requirements of the Securities Exchange Act of 1934, this report has
      been
      signed below by the following persons on behalf of the registrant and in the
      capacities and on the dates indicated.








NAME
            TITLE
            DATE*/s/
                Alex Haditaghi*
            President,
                Secretary and Director
            April
                17, 2007Alex
                Haditaghi





24