**UNITED
        STATES**
 **SECURITIES
        AND EXCHANGE COMMISSION**
 Washington,
        D.C. 20549
 
 **FORM
        10-KSB/A**
 
 **[X]
        ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT**
 **OF
        1934**
 
 For
        the
        fiscal year ended September 30, 2004
 
 **[
        ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES AND**
 **EXCHANGE
        ACT OF 1934**
 
 For
        the
        transition period from _____ to_____
 
 *Commission
        File No. 333-104132*
 
 **Benacquista
        Galleries, Inc.**
 (Name
        of
        Small Business Issuer as specified in its charter)
 
 Nevada
              71-0928242(State
                  or other jurisdiction of incorporation or organization)
              (I.R.S.
                  Employer Identification No.)15208
                  Jarrettsville PikeMonkton,
                  Maryland(410)
                  321-1799 Fax
              21111(Address
                  of principal executive offices)
              (Zip
                  Code)
  (410)
        303-9879
 (Telephone
        Number)
 
 Securities
        to be registered under Section 12(b) of the Act: None
 
 Securities
        registered under Section
 12(g)
        of
        the Act:
 Common
        Stock, $0.001 par value
 (Title
        of
        Class)
 
 Check
        whether the small business issuer (1) filed all reports required to be filed
        by
        Section 13 or 15(d) of the Exchange Act during the past 12 months (or for
        such
        period that the small business issuer was required to file
        such
        reports), and (2) has been subject to such filing requirements for the past
        90
        days.
  [X]
        YES   [  ] NO
 
 Check
        if
        there is no disclosure of delinquent filers in response to Item 405 of
        Regulation S-B contained in this form, and no disclosure will be contained,
        to
        the best of small business issuer'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. [X]
 
 State
        the
        issuer's revenues for its most recent fiscal year. $0
 
 State
        the
        aggregate market value of the voting and non-voting common equity held by
        non-affiliates computed by reference to the price at which the stock was
        sold,
        or the average bid and asked price of such, as of a specified date within
        the
        past 60 days: $639 based on the price at which the stock was sold.
 
 State
        the
        number of shares outstanding of each of the Issuer's classes of common equity,
        as of the latest practicable date. 10,000,000 common stock shares, par value
        $0.001, as of May 31, 2005.
  
 
 
 
 **DOCUMENTS
        INCORPORATED BY REFERENCE**
 NONE
 
 **Transitional
        Small Business Disclosure Format YES  [   ] 
        NO [X]**
 
 The
        Small
        Business Issuer, by this Form 10-KSB/A amends the Form 10-KSB filed on January
        6, 2005 and the Form 10KSB/A filed on June 27, 2005 to change Item 8A: Controls
        and Proceedures, the dates of the signature pages and the text of certifications
        made by our CEO and Principal Accounting and Financial Officer. The remaining
        information in this Form 10-KSB/A has not been changed or updated to reflect
        any
        changes in information that may have occurred subsequent to the date of the
        reporting period that this Form 10-KSB/A relates.
 
 
 
 
 
 
 
 
 
 
 
 
  2
  
 TABLE
        OF
        CONTENTS
 
 FORWARD-LOOKING
                  STATEMENTS
              4PART
                  IITEM
                  1.
              DESCRIPTION
                  OF BUSINESS
              4ITEM
                  2.
              DESCRIPTION
                  OF PROPERTY
              7ITEM
                  3.
              LEGAL
                  PROCEEDINGS
              7ITEM
                  4.
              SUBMISSION
                  OF MATTERS TO A VOTE OF SECURITY HOLDERS
              8PART
                  II.ITEM
                  5.
              MARKET
                  FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
              8ITEM
                  6.
              MANAGEMENT'S
                  DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
              9ITEM
                  7.
              FINANCIAL
                  STATEMENTS
              13ITEM
                  8.
              CHANGES
                  IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
                  DISCLOSURE
              21ITEM
                  8A.
              CONTROLS
                  AND PROCEDURES
              21PART
                  IIIITEM
                  9.
              DIRECTORS,
                  EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH
                  SECTION
                  16(a)OF THE EXCHANGE ACT
              22ITEM
                  10.
              EXECUTIVE
                  COMPENSATION
              23ITEM
                  11.
              SECURITY
                  OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
              24ITEM
                  12.
              CERTAIN
                  RELATIONSHIPS AND RELATED TRANSACTIONS
              24ITEM
                  13.
              EXHIBITS
                  AND REPORTS ON FORM 8-K
              25ITEM
                  14.
              PRINCIPAL
                  ACCOUNTANT FEES AND SERVICES
              25
 
  
 3
  **FORWARD-LOOKING
        STATEMENTS**
 
 In
        addition to historical information, this Report contains forward-looking
        statements. Such forward-looking statements are generally accompanied by
        words
        such as "intends," "projects," "strategies," "believes," "anticipates," "plans,"
        and similar terms that convey the uncertainty of future events or outcomes.
        The
        forward-looking statements contained herein are subject to certain risks
        and
        uncertainties that could cause actual results to differ materially from those
        reflected in the forward-looking statements. Factors that might cause such
        a
        difference include, but are not limited to, those discussed in ITEM 6 of
        this
        Report, the section entitled "MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN
        OF
        OPERATION." Readers are cautioned not to place undue reliance on these
        forward-looking statements, which reflect management's analysis only as of
        the
        date hereof and are in all cases subject to the Company's ability to cure
        its
        current liquidity problems. There is no assurance that the Company will be
        able
        to generate sufficient revenues from its current business activities to meet
        day-to-day operation liabilities or to pursue the business objectives discussed
        herein.
 
 The
        forward-looking statements contained in this Report also may be impacted
        by
        future economic conditions. Any adverse effect on general economic conditions
        and consumer confidence may adversely affect the business of the Company.
 
 Benacquista
        Galleries, Inc. undertakes no obligation to publicly revise these
        forward-looking statements to reflect events or circumstances that arise
        after
        the date hereof. Readers should carefully review the risk factors described
        in
        other documents the Company files from time to time with the Securities and
        Exchange Commission, including without limitation those identified in the
        "Risk
        Factors" section of the Company's Registration Statement filed with the
        Securities and Exchange Commission (the "SEC") on July 23, 2004 on Form SB-2/A.
 
 **PART
        I.**
 
 **ITEM
        1. DESCRIPTION OF BUSINESS.**
 
 **BUSINESS
        DEVELOPMENT**
 
 Benacquista
        Galleries, Inc. is a development stage Nevada Corporation formed on January
        17,
        2003 for the purpose of offering collectable artwork and accessories through
        a
        chain of retail galleries and a fully interactive e-commerce and auction-enabled
        website. To date, the artwork offering remains incomplete, only the basic
        interim website is operational, we have no galleries and we have no customers.
 
 Currently,
        we have very limited operations, no full-time employees, one part time employee
        (sole officer and director James Price), no interactive e-commerce and auction
        website, no retail gallery space and no contracts with any providers of the
        same. We have recently launched our basic interim website., which features
        our
        current, limited art inventory. We have developed a plan of operations that
        could allow us to sell art through at least one retail gallery location and
        over
        the internet.
 
 We
        have
        primary areas of our business that we intend to develop over the next six
        to
        twelve months:
 ·
                Relationships
                    with several artists for exclusive artwork offerings through
                    Benacquista
                    Galleries;
 ·
                A
                    fully interactive e-commerce and auction enabled website;
 ·
                At
                    least one gallery opening in a strategic
                    location;
 ·
                A
                    sales and marketing capability sufficient to handle all website
                    inquiries
                    and gallery traffic.
 History
        and form of organization
 
 Benacquista
        Galleries, Inc. is a development stage Nevada Corporation formed on January
        17,
        2003 for the purpose of offering collectable artwork and accessories through
        a
        chain of retail galleries and a fully interactive e-commerce and auction-enabled
        website. To date, the artwork offering remains incomplete, only the basic
        interim website is operational, we have no galleries and we have no customers.
 
  4
 
 
 Benacquista
        Galleries's principal products and services
 
 We
        have
        developed and launched a basic interim website which displays some of our
        current art inventory for sale. You can visit our website at www.benacquistagalleries.com .
        Because
        our interim website was done on a limited budget, it contains basic company
        information as well as displays several art pieces for sale and information
        on
        the artists.
 
 Our
        limited interim site functions as follows: Our site lists an email address
        where
        customers can send an email enquiring about our artwork for sale or artwork
        that
        will be posted on the site. We email customers back and then initiate an
        email
        or telephone conversation regarding their inquiry. We then negotiate sales
        and
        prices with our customers via email or telephone and consummate the transaction
        using checks, wire transfer or PayPal and physical delivery of the art with
        a
        common carrier. We also intend to sell certain items in our inventory on
        eBay
        and can advise people via email to bid on our art in that forum. In this
        sense,
        our website is functioning more as an advertisement and in the future, as
        a
        catalogue, than as a traditional e-commerce site. If we have the financial
        resources, we intend to upgrade the site to a more comprehensive ecommerce
        site.
 
 In
        February of 2005, we also intend to begin development of a fully interactive
        e-commerce and auction enabled website developed by Cybergroup, Inc. The
        website
        will include visual displays of art inventory and a full on-line auction
        and
        purchase capacity. The website will serve two primary functions for our
        company:
 ·
                developing
                    customer awareness of our brand, offerings, featured artists,
                    retail
                    locations and available artwork to potential purchasers who will
                    then be
                    more likely to visit our retail location; and
 ·
                providing
                    an on-line opportunity to purchase art viewed on our website
                    or at one of
                    our retail galleries.
 Distribution
        and marketing methods
 
 Presently,
        Benacquista Galleries has no salespeople or distributors of its artwork,
        accessories or services. We anticipate that our chief executive officer,
        James
        Price, will use his network of professional and business contacts in the
        art
        industry to sign on our first artists and reach our proposed customer base
        through traditional forms of advertising and through our existing website
        as
        well as contacts made through our planned e-commerce website.. Mr. Price
        established his network of professional and business contacts in the art
        industry as an amateur collector of art over the past 15 years, attending
        auctions and visiting international and domestic galleries. During these
        visits
        and in the course of his purchasing for his own private collection, Mr. Price
        made acquaintances in the industry, including artists, gallery owners, auction
        personnel and suppliers and service providers to the art trade. We intend
        to
        market our artwork via industry trade shows, in trade publications and through
        on-line search engines.
 
 
 Status
        of
        products and services
 
 Currently,
        we have been working on developing developed an interim website that only
        shows
        some of our current artwork for sale, provides general information to customers,
        and displays information regarding our business. We have not done any
        development on our final interactive e-commerce and auction website. However,
        we
        anticipate that 50% of the initial artwork that will be offered for viewing
        on
        the site has already been sold by Mr. Price to the company from his private
        collection. We anticipate that we will have at least an equivalent number
        of
        works acquired from artists whom we intend to identify and with whom we intend
        to contract. We plan to have these additional works in place by March 1,
        2005.
        The substantial majority of these works will be sold on consignment, meaning
        that we will generally not advance funds to individual artists until after
        the
        works are sold. We intend to have most of the technological and hosting aspects
        of the site developed by consultants. While no final software product for
        use on
        the site has been identified, Mr. Price is interviewing several website
        designers and hosting companies. We do not currently have any other products
        or
        services to offer, though we intend to begin offering framing, consignment,
        appraisal and other art related products and services within the next twelve
        months.
 
 
 **Revenues**
 
 Benacquista
        Galleries has derived revenues of $30,000 to date, which were derived in
        the
        three month period ending September 30, 2004 from the sale of artwork listed
        on
        our Website.
 
 Competitive
        conditions, competitive position and methods of competition
  5
 
 
 The
        artwork industry in which we compete contains an old and established network
        of
        galleries and promoters. Intense competition exists for our galleries and
        artwork offerings. The number of companies with which we compete is estimated
        in
        the hundreds and expanding. We expect competition with any galleries or Internet
        sales presence that we develop to increase over time as the market for our
        collectable and investment grade art grows. Competition may also increase
        as a
        result of industry consolidation.
  Our
        chief
        competition comes from large established galleries and websites, such
        as:
 ·
                P
                    and C Art
 ·
                Herndon
                    Fine Art
 ·
                Galleria
                    De Sorrento
 ·
                Art.com
 ·
                Artvest.com
 These
        companies tend to compete for clients by sales of services to existing clients,
        via word of mouth referrals, advertising, trade show presence and artist
        shows.
        Our main method of competition is through product differentiation based on
        style, philosophical orientation, and gallery locations. We intend to
        distinguish our service and artwork offerings by appealing to the collectors
        and
        investors at our specific gallery locations and via the Internet. We believe
        that the philosophical orientation of our services will attract aspiring
        new
        artists to sign exclusive contracts with Benacquista to show their art. This
        orientation will be reflected in the on-line artwork that we offer on the
        site
        and in the focus and direction of the variety of artwork and the customer
        service that we offer in our galleries.
  We
        believe that our competitive position is that of vulnerable, new entrant
        and
        that the success of our artwork offering will be largely dependent on our
        ability to find new artists who are not currently affiliated with any other
        gallery or on-line artwork website.
 
 Dependence
        on one customer
 
 While
        we
        currently have only a few customers, we do not contemplate a dependence on
        one
        customer or one referral source for clients.
  Research
        and development
  We
        have
        not spent any money on research and development to date. We anticipate that
        we
        will spend $100,000 on the development of our website, product descriptions,
        advertising materials and market research on our target demographic of
        purchasers and on availability, pricing and geographic preferences and retail
        art price differentials for our product offering. Much of the development
        of the
        artwork offering and the selection and securing of retail gallery sites will
        be
        undertaken by James Price, our chief executive officer, without additional
        compensation. Although Mr. Price is currently only spending 10-20 hours per
        week
        on Benacquista matters, he is available to spend as much time as necessary
        to
        commence our operations. Mr. Price’s duties to commence operations include
        establishing relationships with artists and art collectors, selecting retail
        store sites, developing advertising materials, supervising the development
        of
        the website, interviewing and selecting retail sales staff and other incidental
        responsibilities. Mr. Price believes that, due to the network of artists
        and art
        collectors with whom he is already acquainted due to his previous purchases
        of
        art over the last 15 years, he should be able to establish necessary
        relationships for Benacquista with a few such individuals with 20 hours of
        effort. Mr. Price has already selected several possible retail sites. He
        believes that final selection of a retail site and lease negotiation will
        take
        no more than 30 hours. Mr. Price believes that developing advertising materials
        to a sufficient level to be printed professionally should take no more than
        10
        hours. Mr. Price believes that his supervision of the development of the
        website
        will take no more than 20 hours. Mr. Price believes that interviewing and
        selecting retail sales staff will take no more than 30 hours. He believes
        that
        incidental matters related to commencement of operations will take no more
        than
        20 hours. These preliminary matters, therefore, should be accomplished with
        140
        hours, according to Mr. Price’s estimates. At 20 hours per week, there would be
        ample time to complete these activities by March 2005 if Mr. Price’s assumptions
        are correct. We have also provided this material in tabular format
        below:
 
 6
 
 Activity
              Number
                  of Hours EstimatedEstablishing
                  Network Artists/Collectors
              20Retail
                  Site Selection and Lease Negotiation
              30Development
                  of Advertising Materials
              10Supervision
                  of Website
              20Interviewing
                  and Selecting Retail Staff
              30Incidental
                  Matters
              20Total
                  Hours Estimated
              130
 
 Proprietary
        rights and licensing
  We
        rely
        primarily on a combination of copyrights, licenses, trade secret laws and
        restrictions on disclosure to protect our artist’s intellectual property and
        proprietary rights. We intend to enter into confidentiality agreements with
        our
        future employees, consultants and artists and to generally control access
        to and
        distribution of our internal documentation and other proprietary information.
 
 Regulatory
        environment
  There
        are
        two aspects of our business which face significant governmental regulation
        or
        are likely to face such regulation; our planned sales offering via the Internet
        and regulations which affect sales of retail art and collectibles in
        general.
  Within
        the United States, the legal landscape for Internet privacy is new and rapidly
        evolving. Collectors and users of consumer information over the internet
        face
        potential tort liability for public disclosure of private information; and
        liability under federal and state fair trade acts when information sharing
        practices do not mirror stated privacy policies. Due to the increasing
        popularity and use of the internet, it is likely that a growing number of
        laws
        and regulations will be adopted at the international, federal, state and
        local
        levels relating to the internet covering issues such as user privacy, pricing,
        content, copyrights, distribution, antitrust and characteristics and quality
        of
        services. Further, the growth and development of the market for activity
        on the
        internet may prompt calls for more stringent consumer protection laws that
        may
        impose additional burdens on those companies conducting business online.
        The
        adoption of any additional laws or regulations may impair the growth of the
        internet, which could, in turn, decrease the demand for our services and
        increase our cost of doing business. Moreover, the applicability to the internet
        of existing laws in various jurisdictions governing issues such as property
        ownership, sales and other taxes, libel and personal privacy is uncertain
        and
        may take years to resolve. Any such new legislation or regulation, the
        application of laws and regulations from jurisdictions whose laws do not
        currently apply to our business or the application of existing laws and
        regulations to the internet could harm our business.
 
 Sellers
        of retail art and collectibles are particularly susceptible to unscrupulous
        individuals selling forged or stolen goods. There are significant local,
        state
        and federal penalties for merchants who sell forged or stolen goods, or goods
        that violate existing copyright interests. Although we intend to make every
        effort to insure that our supply of goods comes from reputable artists and
        sources, we may nevertheless be liable under these regulations for sales
        of such
        articles. Liability can include civil and criminal penalties, as well as
        forfeiture of the artwork without compensation. We may be able to insure
        against
        the costs of some, but not all of these regulations, but do not currently
        maintain such insurance. Liability under existing criminal or civil regulations
        for such sales could have a material, adverse impact on our business.
 
 Employees
        and consultants
  As
        of
        September 30, 2004 we had 1 employee. We do not have any written employment
        agreement with our employee. We believe that our relation with our employee
        is
        good.
  **ITEM
        2. DESCRIPTION OF PROPERTY.**
 
 We
        are
        currently hosted out of the residence of our chief executive officer in Monkton,
        Maryland. We believe that these existing facilities are adequate to meet
        our
        current, foreseeable requirements or that suitable additional or substitute
        space will be available on commercially reasonable terms.
 
 **ITEM
        3. LEGAL PROCEEDINGS.**
 
 The
        Company is not involved in any legal proceedings.
 
 
 7
 
 **ITEM
        4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.**
 
 No
        matters were submitted during the fourth quarter of the fiscal year covered
        by
        this Report to a vote of security holders, through the solicitation of proxies
        or otherwise.
 
 **PART
        II.**
 
 **ITEM
        5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.**
 
 There
        is
        no trading market for our common stock at present and there has been no trading
        market to date. Management has undertaken a discussion with Pennaluna securities
        of Wallace, Idaho regarding sponsorship of an application to quote our stock
        on
        the OTC Bulletin board and such an application is pending before the NASD.
        We
        cannot guarantee that a trading market will ever develop or if a market does
        develop, that it will continue.
 
 
 As
        of
        September 30, 2004 there are:
 ·
                No
                      options outstanding to purchase shares of our common stock
                      except for
                      warrants to purchase 1,000,000 shares of our common stock at
                      $1.00 per
                      share held by XCL Partners;
 ·
                No
                      options to purchase our common stock that are authorized and
                      available for
                      grant;
 ·
                A
                      total of 8,969,100 shares of common stock were issued to our
                      sole officer
                      and director, James Price, all of which are restricted securities,
                      as
                      defined in Rule 144 of the Rules and Regulations of the SEC
                      promulgated
                      under the Securities Act. Under Rule 144, these shares can
                      only be
                      publicly sold, subject to volume restrictions and restrictions
                      on the
                      manner of sale. In addition, we currently have 26,800 shares,
                      , which have
                      been held for over a year and could be sold by the respective
                      holders of
                      such shares at any time pursuant to Rule 144 under the Securities
                      Act of
                      1933, subject to restrictions on the manner of
                      sale.
 ·
                313
                      holders of record of our shares of common stock;
 ·
                No
                      dividends that have been paid on our common stock to date;
                      and
 ·
                No
                    plans to pay dividends on our common stock in the foreseeable
                    future.
 The
        Securities and Exchange Commission has adopted a rule that established the
        definition of a "penny stock," for purposes relevant to us, as any equity
        security that has a market price of less than $5.00 per share or with an
        exercise price of less than $5.00 per share, subject to certain exceptions.
        For
        any transaction involving a penny stock, unless exempt, the rules require:
        (i)
        that a broker or dealer approve a person's account for transactions in penny
        stocks; and (ii) the broker or dealer receive from the investor a written
        agreement to the transaction, setting forth the identity and quantity of
        the
        penny stock to be purchased. In order to approve a person's account for
        transactions in penny stocks, the broker or dealer must (i) obtain financial
        information and investment experience and objectives of the person; and (ii)
        make a reasonable determination that the transactions in penny stocks are
        suitable for that person and that person has sufficient knowledge and experience
        in financial matters to be capable of evaluating the risks of transactions
        in
        penny stocks. The broker or dealer must also deliver, prior to any transaction
        in a penny stock, a disclosure schedule prepared by the SEC relating to the
        penny stock market, which, in highlight form, (i) sets forth the basis on
        which
        the broker or dealer made the suitability determination; and (ii) that the
        broker or dealer received a signed, written agreement from the investor prior
        to
        the transaction. Disclosure also has to be made about the risks of investing
        in
        penny stock in both public offering and in secondary trading, and about
        commissions payable to both the broker-dealer and the registered representative,
        current quotations for the securities and the rights and remedies available
        to
        an investor in cases of fraud in penny stock transactions. Finally, monthly
        statements have to be sent disclosing recent price information for the penny
        stock held in the account and information on the limited market in penny
        stocks.
        As a result, if trading in our common stock is determined to be subject to
        the
        above rules, a stockholder may find it more difficult to dispose of, or to
        obtain accurate quotations as to the market value of, our securities.
 
 Where
        you
        can find additional information
 
 For
        further information with respect to us and our common stock, we refer you
        to the
        registration statement and the exhibits and schedule that were filed with
        our
        registration statement SB-2/A, filed on July 23, 2004.
 
 In
        addition, in accordance with the requirements of the Securities Exchange
        Act of
        1934, we file periodic reports and other information with the Securities
        and
        Exchange Commission. These periodic reports and other information will be
        available for inspection and copying at the regional offices, public reference
        facilities and website of the Securities and Exchange Commission referred
        to
        above, at www.sec.gov.
 
  8
 
 You
        may
        read and copy all materials, which we file with the Securities and Exchange
        Commission at the SEC's Public Reference Room at 450 Fifth Street, N.W.,
        Washington, D.C. 20549. You may obtain information about the operation of
        the
        Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains
        an
        Internet site that contains reports, proxy and information statements, and
        other
        information regarding issuers that file electronically with the SEC at
        http://www.sec.gov. You may also visit our website for further information
        at
        www.benacquistagalleries.com.
 
 **ITEM
        6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.**
 
 The
        following discussion and analysis of our financial condition and results
        of our
        operations should be read in conjunction with our financial statements and
        related notes appearing elsewhere in this report. This discussion and analysis
        contains forward-looking statements that involve risks, uncertainties and
        assumptions. The actual results may differ materially from those anticipated
        in
        these forward-looking statements.
  
 **Overview**
 
 We
        currently have no full-time employees, one part-time employee, less than
        $30,302
        in cash, a few customers, a limited offering of artwork on our website, no
        completed website.
 
 
 Benacquista
        Galleries, Inc. is a development stage Nevada Corporation formed on January
        17,
        2003 for the purpose of offering collectable artwork and accessories through
        a
        chain of retail galleries and a fully interactive e-commerce and auction-enabled
        website. To date, the artwork offering remains incomplete, only the basic
        interim website is operational, we have no galleries and we have no customers.
 
 Currently,
        we have very limited operations, no full-time employees, one part time employee
        (sole officer and director James Price), no interactive e-commerce and auction
        website, no retail gallery space and no contracts with any providers of the
        same. We have recently launched our basic interim website., which features
        our
        current, limited art inventory. We have developed a plan of operations that
        could allow us to sell art through at least one retail gallery location and
        over
        the internet.
 We
        have
        primary areas of our business that we intend to develop over the next six
        to
        twelve months:
 ·
                Relationships
                      with several artists for exclusive artwork offerings through
                      Benacquista
                      Galleries;
 ·
                A
                      fully interactive e-commerce and auction enabled website;
 ·
                At
                      least one gallery opening in a strategic
                      location;
 ·
                A
                      sales and marketing capability sufficient to handle all website
                      inquiries
                      and gallery traffic.
 We
        have
        targeted locations for potential gallery openings during the next 18 months.
        These locations are in Pennsylvania, Virginia, Nevada and Maryland. The
        locations are in shopping malls which have been selected due to the number
        of
        complementary luxury goods stores they contain. We have also focused on
        properties which are highly selective with respect to their retail tenants.
        These properties are amongst the most expensive retail locations per square
        foot
        in the United States. It will be very difficult for us, as a development
        stage
        company without a significant operating history and with very limited cash
        reserves, to successfully secure a location in one or more of these malls.
        In
        addition, significant expenditures of capital can be required to make a retail
        location operable as an art gallery. While these expenses are often covered
        by a
        tenant improvement allowance offered by the mall landlord, there can be no
        assurance that we will receive such an allowance. Although we will seek out
        space that requires as little improvement as possible, there can be no assurance
        that such a space will be available to us on terms which we qualify for and
        would be willing to accept. We intend to enter into lease agreements on four
        facilities. James Price, in a guarantee agreement, has agreed to execute
        lease
        guarantees on each of these locations, if necessary, for a maximum lease
        liability of $500,000 per lease.
 
 We
        have
        developed and launched a basic interim website which displays some of our
        current art inventory for sale. You can visit our website at www.benacquistagalleries.com .
        Because
        our interim website was done on a limited budget, it contains basic company
        information as well as displays several art pieces for sale and information
        on
        the artists.
 
  9
 
 Our
        limited interim site functions as follows: Our site lists an email address
        where
        customers can send an email enquiring about our artwork for sale or artwork
        that
        will be posted on the site. We email customers back and then initiate an
        email
        or telephone conversation regarding their inquiry. We then negotiate sales
        and
        prices with our customers via email or telephone and consummate the transaction
        using checks, wire transfer or PayPal and physical delivery of the art with
        a
        common carrier. We also intend to sell certain items in our inventory on
        eBay
        and can advise people via email to bid on our art in that forum. In this
        sense,
        our website is functioning more as an advertisement and in the future, as
        a
        catalogue, than as a traditional e-commerce site. If we have the financial
        resources, we intend to upgrade the site to a more comprehensive ecommerce
        site.
 
 In
        February of 2005, we also intend to begin development of a fully interactive
        e-commerce and auction enabled website developed by Cybergroup, Inc. The
        website
        will include visual displays of art inventory and a full on-line auction
        and
        purchase capacity. The website will serve two primary functions for our
        company:
 ·
                developing
                      customer awareness of our brand, offerings, featured artists,
                      retail
                      locations and available artwork to potential purchasers who
                      will then be
                      more likely to visit our retail location; and
 ·
                providing
                      an on-line opportunity to purchase art viewed on our website
                      or at one of
                      our retail galleries.
 We
        believe that it will cost between $40,000 and $75,000 to launch our e-commerce
        and auction website and to develop adequate advertising materials. We believe
        that it will cost an additional $25,000 for advertising and marketing for
        the
        website sufficient to drive adequate traffic. We intend to accomplish this
        by
        means of outside consultants and by the efforts of James Price. We believe
        that
        these materials will be completed within 90 days of our receipt of $100,000
        through revenues generated by our interim website, proceeds generated by
        the
        exercise of the warrant or other methods such as the sale of art through
        other
        galleries or eBay or loans from our sole officer and director. Mr. Price
        is not
        legally obligated to make such loans nor do we know under what terms and
        conditions such loans might be available. Our art inventory is valued at
        $915,450, not including two pieces of the company’s art that were not appraised.
        Therefore, whether we sell our art inventory on our interim website or through
        other galleries or on eBay, we would likely be able to raise enough proceeds
        to
        launch our e-commerce and auction website. It is our hope that the website
        and
        marketing plan be completed no later than March 2005. Although we currently
        do
        not have an agreement with any other gallery, we are in the negotiation process.
        If the warrant is exercised, the funds received will be used first to launch
        the
        e-commerce and auction website. However, there is no assurance that the warrant
        will ever be exercised.
 
 Although
        there are no assurances that either the interim website will generate revenues
        or the warrant will be exercised, we believe if we receive sufficient funds
        from
        the sources above we will be able to offer for sale our existing inventory
        of
        artwork on-line and through our first gallery opening by September 2005.
        Although our existing inventory of artwork was sold by our chief executive
        officer, James Price, from his private collection and does not represent
        any
        continuing on-going relationship with a particular artist, we believe that
        the
        inventory will be sufficiently interesting to attract art buyers to our gallery
        and site while we continue to negotiate contracts with individual artists.
        We
        expect that we will spend about $10,000 over 30 days on outside consultants
        to
        integrate our artwork inventory into our website presence. We have no present
        source for these funds other than the revenues expected from our interim
        website
        or the proceeds from the exercise of the warrant. There are no assurances
        that
        either the warrant will be exercised or the interim website will generate
        revenues. It is our hope that at least one new artist and our current inventory
        will be available for sale on our e-commerce and auction website no later
        than
        March 2005.
 
 Sales
        and
        marketing will be critical to the success of our business. Our business model
        relies heavily on our ability to cause collectors and investors to visit
        our
        galleries and our website. We intend to accomplish this goal through a
        combination of methods. We intend to hire a full-time sales and marketing
        director as soon as funding permits. We believe that we can obtain a suitable
        candidate for an annual salary of $65,000, without having to offer insurance
        or
        other benefits. We would need to support this individual with a marketing
        budget
        of approximately $35,000. This budget would be used for travel to and attendance
        at industry trade shows and for advertisements in trade publications and
        websites. We believe that this combination of efforts together with the efforts
        of our chief executive officer, James Price, in approaching colleagues and
        leaders in the art field will be sufficient. We intend to commence hiring
        the
        marketing director and beginning sales and marketing activities as soon as
        funds
        are available. We have no present source for these funds other than the revenues
        expected from our interim website or the proceeds from the exercise of the
        warrant. There are no assurances that either the interim website will generate
        revenues or the warrant will be exercised.
 
  10
 
 We
        believe it will take 3 months for us to identify and hire such an individual.
        We
        believe it will take another 6 to 8 months for the sales and marketing efforts
        to yield profits high enough to open our second gallery.
 
 There
        can
        be no assurance that any of the above alternative strategies will achieve
        our
        intended goals. If we are unsuccessful in securing resources by any of the
        above
        outlined means, then our organization will cease to be able to carry out
        any
        alternative plan of operation and we will cease operations, resulting in
        a total
        loss of investment for all shareholders.
 
 Benacquista
        currently has a limited inventory of art of 43 pieces purchased from our
        chief
        executive officer. Although we plan to sell this artwork along with other
        artwork that we plan to acquire, we have not yet negotiated with any suppliers
        or artists regarding such other artwork. We plan to acquire new artwork from
        individual artists and wholesalers and to sell this artwork on an Internet
        site
        we intend to build as well as in retail galleries that we intend to open.
 
 
 **Sales
        and marketing.** We
        expect sales and marketing expenses to increase sharply to between $25,000
        and
        $50,000 by March of 2005, assuming that we receive sufficient funding to
        initiate our interactive web site and to commence our marketing
        plan.
 
 **General
        and administrative** .
        General
        and administrative expenses were $48,458 during the year ended September
        30,
        2004 and $36,412 during period from inception on January 17, 2003 through
        September 30, 2003. General and administrative expenses increased during
        the
        period ended December 31, 2003 as compared to the comparable fiscal 2003
        period
        due mainly to the recognition of expenses related to our selling shareholder
        registration statement on form SB-2.
 
 **Financial
        Condition**
 
 For
        the
        year ended September 30, 2004, Benacquista Galleries had a net loss of $94,564
        while for the period ended September 30, 2003, the Company had a net loss
        of
        $68,150. Also, for the period ended September 30, 2004, the Company had a
        working capital deficit of $78,254 while for the period ended September 30,
        2004, the Company had a working capital deficit of $31,800.
 
 Benacquista
        Galleries' current financial condition makes it difficult to commence more
        than
        a limited product offering or derive additional revenue until additional
        funding
        is received. Although our chief executive officer is willing to continue
        product
        development and marketing without a salary until additional funding is received,
        we will not have the resources to strengthen our product offering until we
        receive additional cash either from the sale of existing artwork in our
        inventory, additional investments by our chief executive officer, the sale
        of
        equity or debt securities or some combination thereof, none of which can
        be
        assured.
 
 Liquidity
        and capital resources
 
 Net
        cash
        used in operating activities for the year ended September 30, 2004 and the
        period ended September 30, 2003 was $18,287 and $35,871 respectively. As
        of
        September 30, 2004, we had $30,302 in cash. Net cash used in operating
        activities for the year ended September 30, 2004 was primarily the result
        of a
        net loss on sales of artwork as well as operating expenses due to our
        registration statement filed on form SB-2 offset partially by revenue from
        the
        sale of artwork. Net cash used in operating activities for the period ended
        September 30, 2003 was primarily the result of a net loss.
 
 Net
        cash
        provided by financing activities was $48,110 for the year ended September
        30,
        2004. Net cash used in financing activities was $36,350 for the period ended
        September 30, 2003. Net cash provided by financing activities for the year
        ended
        September 30, 2004 was the result of proceeds from a capital contribution
        of our
        majority shareholder. Financing activities for the period ended September
        30,
        2003 were attributable to proceeds from the sale of common stock and from
        a
        capital contribution of our majority shareholder.
 
 As
        of
        September 30, 2004 our principal commitments consisted of our obligations
        outstanding for accrued interest and our long term obligations related to
        a note
        owed by us to our controlling shareholder. We have no material commitments
        for
        capital expenditures. We expect no significant capital expenditures or lease
        commitments during the next fiscal quarter.
 
 
 11
 
 We
        believe that our current cash balances, including cash and cash equivalents,
        are
        insufficient to meet our working capital and capital expenditure requirements.
        We have very limited working capital. We will need to receive an infusion
        of
        capital from our chief executive officer or receive funding from another
        source
        in order to continue operations beyond current levels.
  We
        need
        to secure additional cash as soon as possible. We may seek to sell additional
        equity or debt securities or to obtain a credit facility; however, at the
        present time, we have not entered into any arrangements or understandings
        with
        respect to any such financings. The sale of additional equity or convertible
        debt securities could result in additional dilution to our stockholders.
        The
        incurrence of indebtedness would result in an increase in our fixed obligations
        and could result in operating covenants that would restrict its operations.
        There can be no assurance that financing will be available in amounts or
        on
        terms acceptable to us, if at all. If financing is not available when required
        or is not available on acceptable terms, we may be unable to develop or enhance
        our products or services. In addition, we may be unable to take advantage
        of
        business opportunities or respond to competitive pressures. Any of these
        events
        could have a material and adverse effect on our business, results of operations
        and financial condition.
 
 Benacquista
        Galleries's short-term prospects are challenging considering our lack of
        financial resources.. Without raising any additional cash or being approached
        by
        a strategic partner willing to finance further product development, Benacquista
        Galleries's short-term and long-term prospects for growth are minimal over
        and
        above incremental sales of its existing art inventory on its website.
 
 Cash
        requirements
 
 Presently,
        without additional cash, we will only be able to continue our presently limited
        operations. We have very limited working capital. Our continued operation
        is
        therefore dependent upon our ability to secure additional cash. We need to
        raise
        additional funds as soon as practicable, through the sale of equity or debt
        securities in the company or through the sale of artwork in our existing
        inventory or some combination thereof. We presently have no arrangements
        or
        understandings with any investors or potential investors with respect to
        an
        investment in Benacquista Galleries. We have not decided at what price or
        under
        what terms we will raise such additional funds. The factors that we will
        utilize
        in making such a decision include: our success in developing strategic partners
        for Benacquista Galleries, the market valuation of our competitors, the
        availability of investments generally for development stage start-up companies,
        and the feedback that we receive from potential investors. We intend to target
        potential customers and potential strategic partners as possible investors
        in
        Benacquista Galleries, though we have not received any indications of interest
        so far. Benacquista Galleries has identified acquaintances of our officers
        and
        directors who are interested in providing debt or equity financing for
        Benacquista Galleries. Benacquista Galleries has not reached any terms with
        such
        prospective investors in which such financing would be forthcoming.
 
 **Research
        and development**
 
 We
        have a
        present intention to spend substantial resources on research or development
        over
        the next 12 months, consisting primarily in the development of our website.
        We
        anticipate that, funding permitting, we would spend up to $99,000 on the
        development of our website during the next 12 months.
 
 **Plant
        and equipment**
 
 We
        currently have an office in Monkton, Maryland inside the home of our chief
        executive officer. We believe our currently available space will be insufficient
        for our operations for the next 12 months, but do not anticipate leasing
        any
        additional space for at least 9 months.
 
 **Employees**
 
 We
        intend
        to hire additional personnel to staff our physical galleries and assist us
        in
        the marketing of our on-line gallery. We anticipate hiring such personnel
        in
        approximately 9 months and would hire no more than 9 people.
 
  12
 
 **ITEM
        7. FINANCIAL STATEMENTS.**
 
 
 
 **BENACQUISTA
        GALLERIES, INC.**
 **(A
        Development Stage Enterprise)**
 
 
 **TABLE
        OF CONTENTS**
 
 
 **Page**Report
                  of Independent Registered Public Accounting Firm
              14Balance
                  Sheets as of September 30, 2004 and 2003
              15Statements
                  of Operations for the Year Ended September 30, 2004, for the period
                  from
                  January 17, 2003 (Date of Inception) through September 30, 2003
                  and for
                  the Period from January 17, 2003 (Date of Inception) through September
                  30,
                  2004
              16Statements
                  of Stockholders’ Deficit for the Period from January 17, 2003 (Date of
                  Inception) through September 30, 2003 and for the year ended September
                  30,
                  2004
              17Statements
                  of Cash Flows for the Year Ended September 30, 2004 and For the
                  Period
                  January 17, 2003 (Date of Inception) through September 30, 2003
                  and for
                  the Period from January 17, 2003 (Date of Inception) through September
                  30,
                  2004
              18Notes
                  to Financial Statements
              19
 
 
  13
 
 
 **H****ANSEN****,
                  B****ARNETT****&
                  M****AXWELL**A
                  Professional CorporationCERTIFIED
                  PUBLIC ACCOUNTANTS
              
              **Registered
                  with the Public Company**
                **Accounting
                  Oversight Board**5
                  Triad Center, Suite 750Salt
                  Lake City, UT 84180-1128Phone:
                  (801) 532-2200Fax:
                  (801) 532-7944www.hbmcpas.com
 
 
 
 **REPORT
        OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**
 
 
 
 To
        the
        Board of Directors and Stockholders
 Benacquista
        Galleries, Inc
 
 
 We
        have
        audited the accompanying balance sheets of Benacquista Galleries, Inc. (a
        development stage enterprise) as of September 30, 2004 and 2003, and the
        related
        statements of operations, stockholders’ deficit, and cash flows for the year
        ended September 30, 2004, for the period from January 17, 2003 (Date of
        Inception) through September 30, 2003 and for the period from January 17,
        2003
        (Date of Inception) through September 30, 2004. These financial statements
        are
        the responsibility of the Company’s management. Our responsibility is to express
        an opinion on these financial statements based on our audits.
 
 We
        conducted our audits in accordance with the standards of the Public Company
        Accounting Oversight Board (United States). Those standards require that
        we plan
        and perform the audits to obtain reasonable assurance about whether the
        financial statements are free of material misstatement. An audit includes
        examining, on a test basis, evidence supporting the amounts and disclosures
        in
        the financial statements. An audit also includes assessing the accounting
        principles used and significant estimates made by management, as well as
        evaluating the overall financial statement presentation. We believe that
        our
        audits provide a reasonable basis for our opinion.
 
 In
        our
        opinion the financial statements referred to above present fairly, in all
        material respects, the financial position of Benacquista Galleries, Inc.
        as of
        September 30, 2004 and 2003, and the results of its operations and its cash
        flows for the year ended September 30, 2004, for the periods January 17,
        2003
        (Date of Inception) through September 30, 2003 and 2004 in conformity with
        U.S.
        generally accepted accounting principles.
 
 The
        accompanying financial statements have been prepared assuming that the Company
        will continue as a going concern. As discussed in Note 2 to the financial
        statements, the Company’s lack of operating history raises substantial doubt
        about its ability to continue as a going concern. Management’s plans regarding
        those matters are also described in Note 2. The financial statements do not
        include any adjustments that might result from the outcome of this
        uncertainty.
 
 
 **HANSEN,
                  BARNETT & MAXWELL**Salt
                  Lake City, UtahDecember
                  9, 2004
 
  14
  **BENACQUISTA
                    GALLERIES,INC.****(A
                    Development Stage Enterprise)****BALANCE
                    SHEETS****September
                    30,****2004**
                
                **2003****ASSETS****Current
                    Assets**Cash
                
                $
                30,302
                
                $
                479Inventory
                
                
                826,127
                
                
                862,127**Total
                    Current Assets**
                
                
                856,429
                
                
                862,606**Total
                    Assets**
                
                $
                856,429
                
                $
                862,606**LIABILITIES
                    AND STOCKHOLDERS' DEFICIT****Current
                    Liabilities**Accounts
                    payable
                
                $
                713
                
                $
                541Accrued
                    interest
                
                
                71,843
                
                
                31,738**Total
                    Current Liabilities**
                
                
                72,556
                
                
                32,279**Long-Term
                    Liabilities**Note
                    payable to related party
                
                
                862,127
                
                
                862,127**Total
                    Liabilities**
                
                
                934,683
                
                
                894,406**Stockholders'
                    Deficit**Common
                      stock - $0.001 par value; 50,000,000 shares authorized; 10,000,000
                      shares issued and outstanding, respectively
                
                
                10,000
                
                
                10,000Additional
                    paid-in capital
                
                
                74,460
                
                
                26,350Deficit
                    accumulated during the development stage
                
                
                (162,714
                )
                
                (68,150
                )**Total
                    Stockholders' Deficit**
                
                
                (78,254
                )
                
                (31,800
                )**Total
                    Liabilities and Stockholders' Deficit**
                
                $
                856,429
                
                $
                862,606
 
 The
        accompanying notes are an integral part of these financial
        statements.
 
   15
  
 **BENACQUISTA
                  GALLERIES,INC.****(A
                  Development Stage Enterprise)****STATEMENTS
                  OF OPERATIONS****For
                  The Year Ended September 30,**
              
              **January
                  17, 2003 (Date of Inception) through September 30,**
              
              **Cumulative
                  January 17, 2003 (Date of Inception) through September 30,****2004**
              
              **2003**
              
              **2004****Revenue**
              
              $
              30,000
              
              $
              -
              
              $
              30,000**Cost
                  of Goods Sold**
              
              
              36,000
              
              
              -
              
              
              36,000**Gross
                  Margin**
              
              
              (6,000
              )
              
              
              
              
              (6,000
              )**General
                  and administrative expense**
              
              
              (48,458
              )
              
              (36,412
              )
              
              (84,870
              )**Interest
                  expense**
              
              
              (40,106
              )
              
              (31,738
              )
              
              (71,844
              )**Net
                  Loss**
              
              $
              (94,564
              )
              $
              (68,150
              )
              $
              (162,714
              )**Basic
                  and Diluted Loss per Share**
              
              $
              (0.01
              )
              $
              (0.01
              )**Weighted
                  Average Number of Shares Outstanding**
              
              
              10,000,000
              
              
              9,883,721
 
   
 The
        accompanying notes are an integral part of these financial
        statements.
 
   16
 
 
 **BENACQUISTA
                  GALLERIES,INC.****(A
                  Development Stage Enterprise)****STATEMENTS
                  OF STOCKHOLERS' DEFICIT****Additional**
              
              **Deficit
                  Accumulated During the****Common
                  Stock**
              
              **Paid-in**
              
              **Development****Shares**
              
              **Amount**
              
              **Capital**
              
              **Stage**
              
              **Total**Balance
                  - January 17, 2003 (date of inception)
              
              
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -Shares
                  Issued for cash January 2003 $0.001 per share
              
              
              10,000,000
              
              
              10,000
              
              
              -
              
              
              -
              
              
              10,000Capital
                  contributions by majority shareholder
              
              
              -
              
              
              -
              
              
              26,350
              
              
              -
              
              
              26,350Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              (68,150
              )
              
              (68,150
              )Balance
                  - September 30, 2003
              
              
              10,000,000
              
              
              10,000
              
              
              26,350
              
              
              (68,150
              )
              
              (31,800
              )Capital
                  contributions by majority shareholder
              
              
              -
              
              
              -
              
              
              48,110
              
              
              -
              
              
              48,110Net
                  loss
              
              
              -
              
              
              -
              
              
              -
              
              
              (94,564
              )
              
              (94,564
              )Balance
                  - September 30, 2004
              
              
              10,000,000
              
              $
              10,000
              
              $
              74,460
              
              $
              (162,714
              )
              $
              (78,254
              )
 
 
 The
        accompanying notes are an integral part of these financial
        statements.
 
  17
  
 **BENACQUISTA
                  GALLERIES,INC.****(A
                  Development Stage Enterprise)****STATEMENTS
                  OF CASHFLOWS****September
                  30,**
              
              **January
                  17, 2003 (Date of Inception) through September 30,**
              
              **Cumulative
                  January 17, 2003 (Date of Inception) through September 30,****2004**
              
              **2003**
              
              **2004****Cash
                  Flows From Operating Activities**Net
                  loss
              
              $
              (94,564
              )
              $
              (68,150
              )
              $
              (162,714
              )Changes
                  in operating assets and liabilities:Inventory
              
              
              36,000
              
              
              
              
              
              36,000Accounts
                  payable
              
              
              172
              
              
              541
              
              
              713Accrued
                  interest
              
              
              40,105
              
              
              31,738
              
              
              71,843**Net
                  Cash Provided by Operating Activities**
              
              
              (18,287
              )
              
              (35,871
              )
              
              (54,158
              )**Cash
                  Flows From Investing Activities**
              
              
              -
              
              
              -
              
              
              -**Cash
                  Flows From Financing Activities**Capital
                  contributions from majority shareholder
              
              
              48,110
              
              
              26,350
              
              
              74,460Sale
                  of common stock
              
              
              -
              
              
              10,000
              
              
              10,000**Net
                  Cash Used in Financing Activities**
              
              
              48,110
              
              
              36,350
              
              
              84,460**Net
                  Change in Cash**
              
              
              29,823
              
              
              479
              
              
              30,302**Cash
                  at Beginning of Year**
              
              
              479
              
              
              -
              
              
              -**Cash
                  at End of Year**
              
              $
              30,302
              
              $
              479
              
              $
              30,302**Non
                  Cash Financing Activities**Acquisition
                  of inventory by issuance of note payble to related party
              
              $
              -
              
              $
              862,127
              
              $
              862,127
 
 
 The
        accompanying notes are an integral part of these financial
        statements.
 
  18
 
 **NOTE
        1 - NATURE OF BUSINESS**
 
 ***Organization
        and Nature of Operations —*** On
        January 17, 2003, Benacquista Galleries, Inc. (“the Company”) was organized
        under the laws of the State of Nevada. The Company is considered a development
        stage enterprise and is in the process of raising capital to fund operations.
        As
        such, the Company has since inception spent most of its efforts in developing
        its business plan, constructing core materials for eventual sale to customers
        and in raising capital to fund its operations. The Company has relied upon
        cash
        flows from equity issuances to sustain operations. The planned operations
        of the
        Company consist of selling art work through the internet.
 
 **NOTE
        2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**
 
 ***Business
        Condition*** —
        The
        Company is a new company with no operating history. It has not yet been able
        to
        execute its business plan. This situation raises substantial doubt about
        its
        ability to continue as a going concern. The Company plans to fund its operations
        with revenues from the sale of art inventory on its interim website
        www.benacquistagalleries.com. However, it may also use proceeds from the
        exercise of a warrant to purchase up to 1,000,000 common shares which could
        generate up to $1,000,000. There is no guarantee that the warrant will be
        exercised. In the event that the Company does not generate these funds, the
        Company’s president has indicated that he will loan sufficient funds to cover
        operating needs for the next twelve months. However, there is no guarantee
        that
        these loans will be made. The financial statements do not include any
        adjustments relating to the recoverability and classification of asset carrying
        amounts or the amount and classification of liabilities that might result
        should
        the Company be unable to continue as a going concern.
 
 ***Use
        of Estimates —*** The
        preparation of financial statements in conformity with accounting principles
        generally accepted in the United States of America requires management to
        make
        estimates and assumptions that affect certain reported amounts of assets
        and
        liabilities and disclosure of contingent assets and liabilities at the date
        of
        the financial statements and the reported amounts of revenues and expenses
        during the reporting period. Actual results could differ from those
        estimates.
 
 ***Fair
        Value of Financial Instruments*** —
        The
        carrying amounts reported in the accompanying financial statements for current
        assets approximate fair values because of the immediate or short-term maturities
        of these financial instruments.
 
 ***Income
        Taxes*** —
        The
        Company recognizes an asset or liability for the deferred tax consequences
        of
        all temporary differences between the tax basis of assets or liabilities
        and
        their reported amounts in the financial statements that will result in taxable
        or deductible amounts in future years when the reported amounts of the asset
        or
        liabilities are recovered or settled. Deferred tax assets or liabilities
        are
        measured using the enacted tax rates that will be in effect when the differences
        are expected to reverse. Deferred tax assets are reviewed periodically for
        recoverability and valuation allowances are provided as necessary.
 
 ***Cash*** -
        Cash
        consists of a deposit with a bank.
  ***Inventory*** —
        Inventory is stated at the lower of cost or market.
  19
  ***Net
        Income Per Share-Basic and Diluted*** —
        Basic
        income (loss) per common share is computed on the basis of the weighted-average
        number of common shares outstanding during the period. Diluted income per
        share
        is computed on the basis of the weighted-average number of common shares
        and all
        potentially issuable common shares outstanding during the year. As of September
        30, 2004 and September 30, 2003, there was an outstanding warrant to purchase
        up
        to 1,000,000 common shares that was not included in the computation of diluted
        net loss per share as the effect would be anti-dilutive.
 
 **NOTE
        3** - **INVENTORY**
 
 ***Value*** —
        Inventories are stated at the lower of cost or market. When there is evidence
        that the inventory value is less than the original cost, the inventory is
        reduced to market value. The Company determines market value from periodic
        professional appraisals. Appraisals are performed annually or more often
        as
        deemed appropriate. On September 23, 2003, Ronald L. Brion appraised most
        of the
        works of art and provided an estimated current market value of $875,450.
        Two
        pieces not included in the appraisal were previously appraised for $18,500
        making the total art inventory fair value $893,950.
 
 ***Composition*** —
        Inventory is composed of 41 pieces of art consisting of oil-on-canvas,
        lithograph and pastel paintings, bronze and ceramic sculptures and other
        miscellaneous items.
 
 **NOTE
        4** - **STOCKHOLDERS’
        EQUITY AND WARRANTS**
 
 ***Common
        Stock*** —
        In
        January 2003, the Company issued 10,000,000 shares of common stock to various
        individuals, including officers of the Company, for cash proceeds of $10,000
        or
        $0.001 per share.
 
 ***Additional
        Paid-in Capital*** —
        The
        majority shareholder made cash contributions totaling $48,110 and $26,350
        for
        the year ended September 30, 2004 and the period January 17, 2003 (date of
        inception) through September 30, 2003.
 
 ***Warrant*** —
        In
        January 2003, the Company issued a warrant to purchase up to 1,000,000 shares
        of
        common stock to an unaffiliated company. The following summarizes the
        outstanding warrant at September 30, 2003 and September 30, 2004:
  **Fixed
                    Warrants**
                
                **Warrants**
                
                **Weighted-
                    Average Exercise Price**
                
                **Weighted-Average
                    Remaining Contractual Life**Outstanding
                    at January 17, 2003
                
                
                —
                
                $
                —
                
                
                —Issuances
                
                
                1,000,000
                
                
                1.00Outstanding
                    at September 30, 2003
                
                
                1,000,000
                
                $
                1.00
                
                
                2.34
                    yearsIssuances
                
                
                —
                
                
                —Outstanding
                    at September 30, 2004
                
                
                1,000,000
                
                $
                1.00
                
                
                1.34
                    years
  20
 
 
 **NOTE
        5 - RELATED PARTY TRANSACTIONS**
 
 In
        January 2003, the major shareholder sold certain pieces of his works of art
        to
        the Company for $862,127 represented by an unsecured note payable. The note
        bears interest at 5% per annum and is due in full on January 31, 2005 with
        no
        periodic payments required. The purchase price represents the shareholder’s
        original cost in the art which was originally acquired for cash.
 
 
 **NOTE
        6 - INCOME TAXES**
 
 The
        Company has paid no federal or state income taxes since its incorporation.
        As of
        September 30, 2004 and September 30, 2003, the Company had net operating
        loss
        carry forwards for federal income tax reporting purposes of $162,714 and
        $68,150
        which, if unused, will begin to expire in 2023. The net deferred tax asset
        consists of the following at September 30, 2004 and September 30,
        2003:
 
 
 September
                  30,
                2004
              
              September
                  30,
                2003Deferred
                  tax asset - operating loss carryforwards
              
              $
              55,323
              
              $
              23,171Valuation
                  allowance
              
              
              (55,323
              )
              
              (23,171
              )**Total
                  Deferred Income Tax Asset**
              
              $
              —
              
              $
              —The
                  following is a reconciliation of the income tax computed using
                  the federal
                  statutory rate to the provision for income taxes:Tax
                  at federal statutory rate (34%)
              
              $
              (32,152
              )
              $
              (23,171
              )Change
                  in valuation allowance
              
              
              32,152
              
              
              23,171**Provision
                  for Income Taxes**
              
              $
              —
              
              $
              —
 
 
 **ITEM
        8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS AND FINANCIAL DISCLOSURE.**
 
 The
        Company has not changed accountants during the last two fiscal years; nor
        has
        the Company had any disagreements with the accountants on any matter of
        accounting principles or practices, financial statement disclosures, or auditing
        scope or procedures.
 
 ITEM
        8A.
        CONTROLS AND PROCEDURES.
 
 
 The
        Company's principal executive officer and principal financial officer, based
        on
        his evaluation of the Company's disclosure controls and procedures (as defined
        in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934,
        as
        amended) as of September 30, 2004 have concluded that the Company's disclosure
        controls and procedures are adequate and effective to ensure that any
        information required to be disclosed in any filing under the Exchange Act
        is
        accumulated and communicated to our chief executive officer and principal
        financial officer in order to allow timely decisions regarding required
        disclosure and furthermore that such information is recorded, processed,
        summarized and reported within the time periods specified in the Securities
        and
        Exchange Commission’s rules and forms with respect to any reports that the
        Company makes under the Securities Exchange Act of 1934, as
        amended.
 
 The
        Company's principal executive officer, who is also our principal financial
        officer, has concluded that there were no significant changes in the Company's
        internal controls or in other factors that could significantly affect these
        controls for the year ended September 30, 2004, the date of his most recent
        evaluation of such controls, and that there were no significant deficiencies
        or
        material weaknesses in the Company's internal controls.
   21
 
 
 **PART
        III**
 
 **ITEM
        9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
        WITH
        SECTION 16(A) OF THE EXCHANGE ACT.**
 
 **DIRECTORS
        AND EXECUTIVE OFFICERS**
 
 
 Name
              Age
              Position
              SinceJames
                  Price
              41
              Chief
                  Executive Officer,
                President,
                  Director
              2003
  *
        James
        Price is our sole officer and director.
 
 The
        following is a biographical summary of the experience of the directors and
        executive officers of the Company:
 
 **JAMES
        PRICE, 41 years old**
 
 James
        Price, chief executive officer, principal accounting officer and director.
        Mr.
        Price currently serves as the president of Aero Financial, Inc. located in
        Monkton, Maryland, through which he provides public relations consulting
        services directly to executives and corporations. He has served in this capacity
        at Aero Financial since February of 2002. Mr. Price also serves as Sole Director
        and Chief Executive Officer of Wine Purveyors International, Inc. of
        Lutherville, MD, where he is the sole employee and has all management and
        operational responsibilities and has served in that capacity since January,
        2003. From December of 1997 until February of 2002, Mr. Price was chief
        executive officer of Columbia Financial Group, Inc. of Lutherville, Maryland,
        an
        investor relations firm, where he was responsible for developing an employee
        benefit plan and training program for Columbia’s employees and where he also
        developed and maintained corporate policies and procedures. From February
        of
        1995 until December of 1997, Mr. Price was a stockbroker employed by Global
        Financial in Bel Air, Maryland.  From September of 1980 until June
        of 1982,
        Mr. Price attended Eastern Washington University in Cheney, Washington, where
        he
        took general studies courses with an interest in art history. Mr. Price is
        a
        veteran of the U.S Army, serving from September of 1982 until September of
        1985.
  Mr.
        Price
        currently spends 10-20 hours per week on Benacquista Galleries matters. It
        is
        possible that Mr. Price’s outside business interests and his lack of full-time
        commitment to Benacquista Galleries may materially damage our financial
        prospects and prospects for commercial success with our business
        model.
 
 
 **SIGNIFICANT
        EMPLOYEES**
 
 The
        Company's sole significant employee is James Price, its Chief Executive Officer,
        Principal Accounting Officer and Director.
 
 **FAMILY
        RELATIONSHIPS**
 
 There
        are
        no family relationships between any directors or executive officers of the
        Company, either by blood or by marriage.
 
 **INVOLVEMENT
        IN CERTAIN LEGAL PROCEEDINGS**
 
 During
        the past five years, no director, person nominated to become a director,
        executive officer, promoter or control person of the Company:
 
 (1)
        was a
        general partner or executive officer of any business against which any
        bankruptcy petition was filed, either at the time of the bankruptcy or two
        years
        prior to that time; The officers and directors of the Company due to the
        Operating Subsidiary filing a voluntary petition under Chapter 11 of the
        Bankruptcy Code.
 
 (2)
        was
        convicted in a criminal proceeding or named subject to a pending criminal
        proceeding (excluding traffic violations and other minor offenses);
 
 (3)
        was
        subject to any order, judgment or decree, not subsequently reversed, suspended
        or vacated, of any court of competent jurisdiction, permanently or temporarily
        enjoining, barring, suspending or otherwise limiting his involvement in any
        type
        of business, securities or banking activities; or
 
 (4)
        was
        found by a court of competent jurisdiction (in a civil action), the SEC or
        the
        Commodity Futures Trading Commission to have violated a federal or state
        securities or commodities law, and the judgment has not been reversed, suspended
        or vacated.
 
  22
 
 
 Section
        16(a) Beneficial Ownership Reporting Compliance
 
 Section
        16(a) of the Securities Exchange Act of 1934 and the rules thereunder require
        Benacquista Galleries's officers and directors, and persons who beneficially
        own
        more than ten percent of a registered class of Benacquista Galleries's equity
        securities, to file reports of ownership and changes in ownership with the
        Securities and Exchange Commission and to furnish Benacquista Galleries with
        copies.
 
 Based
        on
        its reviews of the copies of the Section 16(a) forms received by it, or written
        representations from certain reporting persons, Benacquista Galleries, Inc.
        believes that all outstanding obligations by reporting persons have been
        met.
 
 **CODE
        OF ETHICS**
 
 Our
        Board
        of Directors has not yet adopted a written Code of Business Conduct and Ethics.
        However, we are currently in the process of applying for and maintaining
        the
        listing of our common stock on the OTC Bulletin Board. As part of the listing
        process, we expect to adopt a written Code of Business Conduct and Ethics.
 
 **ITEM
        10. EXECUTIVE COMPENSATION.**
 
 **EXECUTIVE
        COMPENSATION**
 
 The
        following table sets forth certain information with respect to the compensation
        that was paid in the 2004 fiscal year to the Company's executive officers
        and
        the aggregate compensation paid by the Company for services rendered during
        the
        periods indicated:
  Summary
          Compensation Table
 
 Long
                    Term CompensationAnnual
                    compensation
                
                Awards
                
                Payouts(a)
                
                (b)
                
                (c)
                
                (d)
                
                (e)
                
                (f)
                
                (g)
                
                (h)
                
                (i)Name,
                    Principal Position
                
                Year
                
                Salary($)
                
                Bonus($)
                
                Other
                    annual compensation($)
                
                Restricted
                    award(s)($)
                
                Securities
                    stock underlying options/SA Rs(#)
                
                LTIP
                    Payouts($)
                
                All
                    other Comps ($)James
                    Price,
                    CEO,
                      Principal Accounting Officer, Director
                
                
                2004
                
                $
                0
                    *
                
                
                0
                
                
                0
                
                
                0
                
                
                0
                
                
                0
                
                
                0
 **James
        Price has not yet drawn any salary from Benacquista Galleries. It is anticipated
        that Mr. Price will begin taking a salary of $60,000 beginning March 31,
        2005;
        however, Mr. Price does not intend to begin taking or accruing a salary until
        the 1,000,000 shares underlying the warrant held by XCL Partners have been
        exercised at $1.00 per share. As there can be no assurance that this will
        ever
        happen, Mr. Price may serve indefinitely without a salary.
 
 Option
        grants since inception and aggregate option exercises during last fiscal
        year
        and fiscal year-end option values.
 
 Since
        inception, we have not granted any stock options to any individual, including
        our chief executive officer, except that we have granted warrants to purchase
        1,000,000 shares of our common stock to XCL Partners at an exercise price
        of
        $1.00 per share. We anticipate granting options to various employees, directors
        and consultants. Any such grants will be made at an exercise price equal
        to the
        fair market value of our common stock as determined by our board of directors.
 
 We
        have
        no employment agreements with any of our employees.
 
 **DIRECTOR
        COMPENSATION**
 
 For
        the
        fiscal year ended September 30, 2004, our sole director, James Price was
        not
        compensated for his services.
 
  23
 
 
 **ITEM
        11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.**
 
 The
        following table sets forth the beneficial ownership of shares of Common Stock
        as
        of September 30, 2004, for (i) each person who is known by the Company to
        be the
        beneficial owner of more than a 5% interest in the Company, (ii) directors
        of
        the Company, (iii) the sole "named executive officer" of the Company, as
        defined
        in Item 402(a)(2) of SEC Regulation S-B, and (iv) the directors and named
        executive officer of the Company as a group. Unless otherwise indicated in
        the
        footnotes, all such interests are owned directly, and the indicated person
        or
        entity has sole voting and investment power. Addresses are provided only
        for 5%
        or greater owners.
 
 Executive
        Officers and Directors as a group as of September 30, 2004.
  **Beneficial
                  Ownership****Title
                  of Class**
              **Name
                  and Address of**
                **Beneficial
                  Owner**
              **Amount
                  and Nature of**
                **Beneficial
                  Owner**
              **Percent
                  of Class**Common
              James
                  Price (1)
                15208
                  Jarrettsville Pike, Monkton, Maryland 21111
              8,969,100
              89.69%
                  (3)Common
              Timothy
                  J. Rieu (2)
                3325
                  Great Valley Drive,
                West
                  Friendship, MD 21794
              1,400,000
                  (4)
              13.09%
                  (4)
  (1)
              Mr.
                  Price is the only officer and director. His address is 15208 Jarrettsville
                  Pike, Monkton, Maryland 21111.
 
 (2)
              Mr.
                  Rieu is the principal of XCL Partners, who is located at 3325 Great
                  Valley
                  Drive, West Friendship, MD 21794. Timothy J. Rieu is the sole proprietor
                  of XCL Partners.
 
 (3)
              The
                  89.69% of class is calculated using 10,000,000 shares of common
                  stock
                  outstanding. This does not include the issuance of 1,000,000 shares
                  of
                  common stock upon the exercise of the warrant held by XCL Partners.
 
 (4)
              There
                  are currently 10,000,000 shares of issued and outstanding stock.
                  The
                  exercise of the warrant will result in the issuance of another
                  1,000,000
                  common shares. The 13.09 % of class assumes the issuance of the
                  1,000,000
                  shares under the warrant reflecting XCL Partners ownership on a
                  fully
                  dilutive basis (based on 11,000,000 shares outstanding) in addition
                  to the
                  400,000 issued shares Mr. Rieu currently owns (based on 10,000,000
                  currently outstanding shares).
 
 
 **ITEM
        12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS**
 
 There
        has
        not been, nor is there currently proposed, any transaction or series of similar
        transactions to which we were or are to be a party in which the amount involved
        exceeds $60,000, and in which any director, executive officer, holder of
        more
        than 5% of our common stock or any member of the immediate family of any
        of
        these people had or will have a direct or indirect material interest except
        as
        listed below:
 
 On
        January 31, 2003, chief executive officer James Price sold a number of
        individual works of art to us for a purchase price of $862,127.25. We issued
        a
        note for the amount of the purchase price, payable to Mr. Price. The note
        bears
        interest at an annual rate of 5%. The principal and interest under the note
        are
        due and payable on January 31, 2005. There is no penalty for prepayment.
        Mr.
        Price paid $862,127.25 for the art.
 
  24
 
 **ITEM
        13. EXHIBITS AND REPORTS ON FORM 8-K.**
 
 (a)
        LIST
        OF EXHIBITS
 
 **List
        of Exhibits**
 
  3.1
              Articles
                  of Incorporation of small business issuer as filed previously with
                  the
                  Commission on Form SB-2, dated March 31, 20033.2
              Bylaws
                  of small business issuer as filed previously with the Commission
                  on Form
                  SB-2, dated March 31, 2003.31.1
              Certification
                  of Chief Executive Officer pursuant to Section 302 of Sarbanes-Oxley
                  Act
                  of 200232.1
              Certification
                  of the Company's Chief Executive Officer pursuant to 18 U.S.C.
                  Section
                  1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
                  Act of
                  2002
  (b)
        REPORTS ON FORM 8-K
 
 The
        following reports on Form 8-K were filed by the Company during the fiscal
        quarter ended September 30, 2004:
 
 None
 
 **ITEM
        14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.**
 
 Audit
        fees. Total annual audit fees billed for professional services rendered by
        Hansen, Barnett & Maxwell, during the 2004 and 2003 fiscal years for the
        audit of our annual financial statements and the review of the financial
        statements included in our quarterly reports on Form 10-QSB, or services
        that
        are normally provided by Hansen, Barnett & Maxwell, P.C. in connection with
        statutory and regulatory filings or engagements for those fiscal years, totaled
        approximately $6,304 and $ 5,723 respectively.
 
 Audit-related
        Fees. Total aggregate audit fees billed during the 2004 and 2003 fiscal years
        for assurance and related services by Hansen, Barnett & Maxwell, that are
        reasonably related to the performance of the audit or review of Benacquista
        Galleries, Inc.'s financial statements and not reported in the paragraph
        above
        under "Audit Fees" were $11,443 and $9,925, respectively. These fees were
        primarily for services provided with the company’s registration statements.
 
 Tax
        Fees.
        The total fees billed during the 2004 and 2003 for professional services
        rendered by Hansen, Barnett & Maxwell, for tax compliance, tax advice, and
        tax planning services were approximately $158 and $0, respectively.
        Specifically, these services involved preparation of the consolidated tax
        returns and guidance on tax accruals.
 
 All
        Other
        Fees. There were no fees billed by Hansen, Barnett & Maxwell, during our
        2004 and 2003 fiscal years for any other services rendered to Benacquista
        Galleries, Inc. other than the amounts set forth above.
 
 
 
 25
 
 **SIGNATURE**
 
 In
        accordance with Section 13 or 15(d) of the Exchange Act, the Company caused
        this
        report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
 **Benacquista
        Galleries, Inc.**
 
 
 
 */s/
                  James
                  Price**James
                  Price**Chief
                  Executive Officer**(Duly
                  Authorized Officer and Principal *Financial
                  and Accounting Officer)**
 
 
 
 
 
 In
        accordance with the Exchange Act, this report has been signed below by the
        following persons on behalf of the company and in the capacities and on the
        dates indicated.
 
 */s/
                  James
                  Price*
                *James
                  Price*
                *Chief
                  Executive Officer*
                *(Duly
                  Authorized Officer and Principal Financial and Accounting
                  Officer)*
                
                
                
                *Dated:
                  July 11, 2005*
     26