SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

[X]   QUARTERLY  REPORT  PURSUANT  TO  SECTION  13 OR  15(d)  OF THE  SECURITIES
      EXCHANGE ACT OF 1934

                For the quarterly period ended September 30, 2004

                                       or

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

For the transition period from ______________ to ___________________

                        Commission file number: 000-30583

                               PRACTICEXPERT, INC.
           (Name of Small Business Issuer as specific in its Charter)

                        Nevada                            87-0622329
                        ------                            ----------
            (State or Other Jurisdiction of            (I.R.S. Employer
            Incorporation or Organization)            Identification No.)

 10833 Washington Blvd, Culver City, CA                     90232
----------------------------------------                    -----
(Address of Principal Executive Offices)                  (Zip Code)

          Issuer's telephone number, including area code: 310-815-3500

                 (Former name, former address and former fiscal
                      year, if changed since last report)

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

As of November 16, 2004,  the number of shares of Common Stock  outstanding  was
113,311,340.

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

<PAGE>

                                TABLE OF CONTENTS
                                                                           PAGE

PART I - FINANCIAL INFORMATION...............................................1

ITEM 1        FINANCIAL STATEMENTS...........................................1

              Consolidated Balance Sheet as of September 30, 2004............1

              Consolidated Statements of Operations for
              the three and nine months ended September 30, 2004 and 2003....2

              Consolidated Statements of Cash Flows for
              the three and nine months ended September 30, 2004 and 2003....3

              Notes to Consolidated Financial Statements.....................4

ITEM 2   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
              CONDITION AND RESULTS OF OPERATIONS...........................15

ITEM 3   CONTROLS AND PROCEDURES............................................19

PART II - OTHER INFORMATION.................................................20

ITEM 1   LEGAL PROCEEDINGS..................................................20

ITEM 2   UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS........20

ITEM 3   DEFAULTS UPON SENIOR SECURITIES....................................21

ITEM 4   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS................22

ITEM 5   OTHER INFORMATION..................................................22

ITEM 6   EXHIBITS AND REPORTS ON FORM 8-K...................................22

SIGNATURES..................................................................23

<PAGE>

                         PART I - FINANCIAL INFORMATION

ITEM 1.       FINANCIAL STATEMENTS

                               PRACTICEXPERT, INC.
                     (FORMERLY, THAON COMMUNICATIONS, INC.)
                           CONSOLIDATED BALANCE SHEET
                               SEPTEMBER 30, 2004
                                   (UNAUDITED)

                                     ASSETS


<TABLE>
<CAPTION>
<S>                                                                                      <C>
      CURRENT ASSETS:
           Cash & cash equivalents                                                       $    199,583
           Prepaid expense                                                                     85,042
           Accounts receivable, net                                                           880,871
           Accounts receivable-management service                                             648,027
           Other current assets                                                                32,713
                                                                                         ------------
                   Total current assets                                                     1,846,236

      PROPERTY AND EQUIPMENT, NET                                                             369,375

      OTHER ASSETS
           Deposits                                                                            10,798

      INTANGIBLES:
           Software, net                                                                      424,354
           Client list, net                                                                 6,109,741
                                                                                         ------------
                                                                                         $  8,760,504
                                                                                         ============


                       LIABILITIES AND STOCKHOLDERS' EQUITY

      CURRENT LIABILITIES:
           Accounts payable & accrued expenses                                           $  1,925,525
           Notes payable - related parties                                                    218,296
           Notes payable                                                                      631,473
           Advances                                                                           422,781
           Other current liability, including related party debt of $173,705                  293,809
           Dividends payable                                                                   15,306
                                                                                         ------------
                   Total current liabilities                                                3,507,190

      Note Payable, related party - long term                                                 178,979
      Note Payable - long term                                                                 38,925


      COMMITMENTS

      STOCKHOLDERS' EQUITY
           Preferred stock - unclassified, authorized shares 36,000,000,  no par value
              none issued
           Preferred stock convertible - Series C, 6%, $.001 par value
              2,000,000 shares authorized; 41,170 issued and outstanding                           41
           Common stock, $.001 par value, 200,000,000 shares authorized;
              112,473,429 issued and outstanding                                              112,473
           Treasury Stock, 49,000 shares of common stock                                     (285,000)
           Additional paid in capital                                                      14,956,991
           Shares to be issued                                                                242,040
           Accumulated deficit                                                             (9,991,135)
                   Total stockholders' equity                                               5,035,410

                                                                                         ------------
                                                                                         $  8,760,504
                                                                                         ============
</TABLE>


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


                                       1
<PAGE>

                               PRACTICEXPERT, INC.
                     (Formerly, Thaon Communications, Inc.)
                      CONSOLIDATED STATEMENTS OF OPERATION
  FOR THE THREE MONTH AND NINE MONTH PERIODS ENDED SEPTEMBER 30, 2004 AND 2003
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                       FOR THE THREE MONTH PERIODS     FOR THE NINE MONTH PERIODS
                                                                            ENDED SEPTEMBER 30,             ENDED SEPTEMBER 30,
                                                                           2004            2003            2004             2003
                                                                       ------------    ------------    ------------    ------------
<S>                                                                    <C>             <C>             <C>             <C>
NET REVENUES:
        MEDICAL BILLINGS AND RELATED SERVICES                          $  2,377,333    $    883,065    $  5,064,230    $  2,325,710
        MANAGEMENT SERVICES                                               1,376,816              --       2,311,328              --
                                                                       ------------    ------------    ------------    ------------
                   TOTAL NET REVENUE                                      3,754,149         883,065       7,375,558       2,325,710

OPERATING EXPENSES:
        MEDICAL BILLINGS AND RELATED SERVICES                             3,540,800       1,468,192       7,659,038       3,374,522
        MANAGEMENT SERVICES                                               1,261,147              --       1,740,542              --
                                                                       ------------    ------------    ------------    ------------
                   TOTAL OPERATING EXPENSES                               4,801,947       1,468,192       9,399,580       3,374,522

                                                                       ------------    ------------    ------------    ------------
LOSS FROM OPERATIONS                                                     (1,047,798)       (585,127)     (2,024,022)     (1,048,812)

NON-OPERATING INCOME (EXPENSE):
        Legal settlement                                                         --          52,326         (75,750)         52,326
        Gain  on settlement of debts                                         85,488              --          70,988        (116,761)
        Gain (loss) on disposal of asset                                         --              --          (1,706)         32,478
        Impairment of goodwill                                                   --      (1,684,290)             --      (1,684,290)
        Interest income                                                         130             927             321           3,182
        Interest expense                                                    (46,987)        (22,236)       (206,555)        (69,468)
                                                                       ------------    ------------    ------------    ------------
                   Total non-operating income (expense)                      38,631      (1,653,273)       (212,702)     (1,782,533)

                                                                       ------------    ------------    ------------    ------------
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES AND
  DISCONTINUED OPERATIONS                                                (1,009,167)     (2,238,400)     (2,236,724)     (2,831,345)

INCOME TAXES                                                                     --          11,841           6,400          19,090
                                                                       ------------    ------------    ------------    ------------

LOSS FROM CONTINUING OPERATIONS                                          (1,009,167)     (2,250,241)     (2,243,124)     (2,850,435)

OPERATION FROM SUBSIDIARY TO BE DISPOSED
  Loss from operation to be disposed, net                                   (13,288)         (4,793)        (54,327)         (4,793)

DISCONTINUED OPERATIONS
  Gain on disposal of subsidiary, net                                            --       3,433,069              --       3,433,069
                                                                       ------------    ------------    ------------    ------------

NET INCOME (LOSS)                                                        (1,022,455)      1,178,035      (2,297,451)        577,841

Dividend requirement for preferred stock                                       (618)        (87,729)        (63,740)       (296,356)
                                                                       ------------    ------------    ------------    ------------

NET INCOME (LOSS) APPLICABLE TO COMMON SHAREHOLDERS                    $ (1,023,073)   $  1,090,306    $ (2,361,191)        281,485
                                                                       ============    ============    ============    ============

BASIC  WEIGHTED AVERAGE NUMBER OF
    COMMON STOCK OUTSTANDING*                                           112,072,024       9,586,905      69,294,002       8,807,296
                                                                       ============    ============    ============    ============

DILUTED WEIGHTED AVERAGE NUMBER OF
    COMMON STOCK OUTSTANDING*                                           112,072,024      46,000,057      69,294,002      44,378,790
                                                                       ============    ============    ============    ============

BASIC NET LOSS PER SHARE FROM CONTINUING OPERATION                     $      (0.01)   $      (0.23)   $      (0.03)   $      (0.32)
                                                                       ============    ============    ============    ============
DILUTED NET LOSS PER SHARE FROM CONTINUING OPERATION                   $      (0.01)   $      (0.05)   $      (0.03)   $      (0.06)
                                                                       ============    ============    ============    ============

BASIC NET LOSS PER SHARE FROM OPERATION TO BE DISPOSED                 $      (0.00)   $      (0.00)   $      (0.00)   $      (0.00)
                                                                       ============    ============    ============    ============
DILUTED NET LOSS PER SHARE FROM OPERATION TO BE DISPOSED               $      (0.00)   $      (0.00)   $      (0.00)   $      (0.00)
                                                                       ============    ============    ============    ============

BASIC NET INCOME (LOSS) PER SHARE FROM DISCONTINUED OPERATION          $       0.00    $       0.36            0.00    $       0.39
                                                                       ============    ============    ============    ============
DILUTED NET INCOME (LOSS) PER SHARE FROM DISCONTINUED OPERATION        $       0.00    $       0.07    $       0.00    $       0.08
                                                                       ============    ============    ============    ============

BASIC NET LOSS PER SHARE FOR DIVIDENDS FOR PREFERRED STOCK             $      (0.00)   $      (0.01)   $      (0.00)   $      (0.03)
                                                                       ============    ============    ============    ============
DILUTED NET LOSS PER SHARE FOR DIVIDENDS FOR PREFERRED STOCK           $      (0.00)   $      (0.00)   $      (0.00)   $      (0.01)
                                                                       ============    ============    ============    ============

BASIC  NET INCOME ( LOSS) PER SHARE                                    $      (0.01)   $       0.11    $      (0.03)   $       0.03
                                                                       ============    ============    ============    ============
DILUTED  NET INCOME (LOSS) PER SHARE                                   $      (0.01)   $       0.02    $      (0.03)   $       0.01
                                                                       ============    ============    ============    ============
</TABLE>

Weighted  average  number of shares used to compute  basic and diluted  loss per
share  for 2004  are the  same  since  the  effect  of  dilutive  securities  is
anti-dilutive.


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


                                       2
<PAGE>

                               PRACTICEXPERT, INC.
                     (Formerly, Thaon Communications, Inc.)
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
          FOR THE NINE MONTH PERIODS ENDED SEPTEMBER 30, 2004 AND 2003
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                           2004            2003
                                                                                       ------------    ------------
<S>                                                                                    <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
        Net income (loss)                                                              $ (2,361,191)   $    281,485
        Adjustments to reconcile net income (loss) to net cash provided by (used in)
           operating activities:
              Depreciation and amortization                                               1,190,377         254,350
              Loss (gain) on disposal of asset                                                1,706         (32,478)
              Impairment of goodwill                                                             --       1,684,290
              Gain on settlement of debts                                                   (70,988)        116,761
              Gain on legal settlement                                                           --         (52,326)
              Gain on disposal of subsidiaries                                                   --      (3,433,069)
              Shares issued for services and compensation                                   632,033         921,754
              Shares to be issued for services                                              207,040              --
              Shares  issued for interest                                                    17,335           9,720
              (Increase) decrease in current assets
                        Accounts receivable                                                (315,690)        196,093
                        Accounts receivable-management services                            (646,481)             --
                        Prepaid expenses                                                     19,812              --
                        Inventory                                                                --
                        Other current assets                                                (32,095)         17,285
              Increase (decrease) in current liabilities:
                        Accounts payable and accrued expense                              1,104,230         321,753
                        Dividends payable                                                        --         296,356
              (Increase) decrease in other assets-deposit                                    (3,563)         (3,563)
                                                                                       ------------    ------------
        Total Adjustments                                                                 2,103,716         296,926
                                                                                       ------------    ------------
                      Net cash provided by (used in) operating activities                  (257,475)        578,411
                                                                                       ------------    ------------

CASH FLOWS FROM INVESTING ACTIVITIES
              Restricted cash                                                                    --         174,864
              Cash paid in acquisition of subsidiaries                                   (4,250,000)             --
              Development of software                                                      (164,243)        (99,075)
              Purchase of property & equipment                                             (139,431)       (153,502)
                                                                                       ------------    ------------
                      Net cash used in investing activities                              (4,553,674)        (77,713)
                                                                                       ------------    ------------

CASH FLOWS FROM FINANCING ACTIVITIES:
              Proceeds of loans from related parties                                         94,269          55,557
              Payments of notes payable                                                  (1,185,185)       (643,469)
              Cash received from shares to be issued                                         35,000         111,559
              Cash received from issuance of shares                                       5,867,153              --
              Proceed from subscription                                                     126,978              --
              Proceed from disposal of fixed asset                                            1,500              --
                                                                                       ------------    ------------
                      Net cash provided by (used in) financing activities                 4,939,715        (476,353)
                                                                                       ------------    ------------

NET INCREASE IN CASH & CASH EQUIVALENTS                                                     128,566          24,345

CASH & CASH EQUIVALENTS, BEGINNING BALANCE                                                   71,017          33,972
                                                                                       ------------    ------------

CASH & CASH EQUIVALENTS, ENDING BALANCE                                                $    199,583    $     58,317
                                                                                       ============    ============
</TABLE>


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


                                       3
<PAGE>

                               PRACTICEXPERT, INC.

                     (FORMERLY, THAON COMMUNICATIONS, INC.)
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Practice Xpert Services Corp.  ("Practice Xpert") was incorporated on August 11,
2001  in the  State  of  California,  under  the  name  Care  Delivery  Services
Corporation. On October 22, 2001, the Company filed an amendment to its articles
of incorporation to change the Company's name to PracticeXpert Services Corp.

Practice Xpert Services Corp., a healthcare  technology and services company, is
in the business of developing and deploying  systems,  technologies and services
designed to improve operational efficiencies,  reduce billing errors and enhance
cash flow for medical practitioners. Its services revolve around PracticeXpert's
flagship Revenue Management System,  PXpert(TM), and include medical billing and
accounts  receivable  management,   practice  management,   transcription,   and
consulting. Where applicable, Practice Xpert bundles its technology applications
with its billing and other  practice  management  services to provide a complete
and integrated solution to its physician customers.

On April 11, 2003,  Practice  Xpert  Services  Corp.  a California  corporation,
entered  into  a  stock  purchase  agreement  with  Thaon  Communications,  Inc.
(`Thaon")  Pursuant to the Purchase  Agreement,  which closed on April 11, 2003,
Thaon purchased 92% of Practice Xpert's outstanding common stock in exchange for
newly  issued  shares of Thaon's  common  stock and shares of Thaon's  Preferred
Series C stock to former owner of Practice  Xpert (the "Selling  Shareholders").
As a group, the Selling Shareholders  received 7,670,5965 (post split) shares of
common  stock and  1,845,000  shares of Preferred  Series C stock,  constituting
72.75% of Thaon's voting securities.  As a condition of the Purchase  Agreement,
on April 11,  2003,  the  officers of Thaon  resigned and the board of directors
appointed  officers of Practice Xpert as the combined  company's (the "Company")
officers.

On  September  30,  2003,  the Company  purchased  the  remaining 8% of Practice
Xpert's  outstanding  common stock by issuing  472,860  shares of the  Company's
common stock and 111,736 shares of Preferred Series C stock.

According to the terms of the share exchange agreement,  control of the combined
companies (the "Company")  passed to the former  shareholders of Practice Xpert.
This  type  of  share  exchange  has  been  treated  as  a  capital  transaction
accompanied by  recapitalization  of Practice Xpert in substance,  rather than a
business  combination,  and is deemed a  "reverse  acquisition"  for  accounting
purposes since the former owners of Practice Xpert  controlled a majority of the
total common shares outstanding  immediately  following the acquisition.  No pro
forma financial statements are being presented as Thaon had no significant asset
prior to the acquisition.

On July 21, 2003, the Company changed its name to PracticeXpert, Inc.

Thaon Communications,  Inc. (`Thaon") was originally incorporated under the name
Engineering  Services,  Inc. (a Nevada  Corporation),  on July 13,  1984.  Thaon
changed its name to Deep Earth,  Inc. in November of 1998. On November 29, 1999,
Thaon changed its name to CastPro.com, Inc

Practice  Xpert  owns 100% of the issued and  outstanding  shares of  Healthcare
Administrative  Management Corporation (HAMC), a California corporation and K.R.
Johnson  and  Associates  (KRJA),  an  Idaho  corporation.  On  July  31,  2003,
PracticeXpert  entered into a purchase  agreement to acquire 100% of  Healthcare
Billing Solutions, Inc. (HBS), a Montana corporation.


                                       4
<PAGE>

                               PRACTICEXPERT, INC.

                     (FORMERLY, THAON COMMUNICATIONS, INC.)
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

The management of the Company decided to dispose  Healthcare  Billing Solutions,
Inc.  effective  September 1, 2004. The rescission of purchase and sale of stock
agreement has not been  consummated  as of September 30, 2004. The loss from HBS
for  eight-month  period  ended  August  31,  2004 was  presented  as loss  from
operation to be disposed in the financial statements.

Healthcare   Administrative   Management   Corporation   (HAMC),   a  California
corporation was formed on July 29, 1997.

K.R. Johnson and Associates  (KRJA), an Idaho corporation was formed on December
22, 1995.

Healthcare  Billing  Solutions,  Inc. (HBS),  Montana  corporation was formed on
March 8, 2001.

On November 10, 2003,  PracticeXpert  completed the 100% acquisition of National
Healthcare  Management  Services,  Inc.  ("NHMS"),  West  Virginia  Corporation.
National  Healthcare   Management   Services,   Inc.  (NHMS),  a  West  Virginia
corporation,  was formed on June 23, 1999.  On March 1, 2004,  PracticeXpert  of
Texas (PX-TX),  which was formed on November 7, 2003, a 100% owned subsidiary of
the Company,  completed its 100%  acquisition of Singer  MedScript's  assets,  a
Houston Texas sole proprietorship company, which was formed in 1976.
On April 28, 2004, the Company completed its acquisition of Cancer Care Network,
Inc., an Oklahoma corporation,  located in Oklahoma City, Oklahoma.  Cancer Care
Network,  Inc.  specializes  in  radiation  and  medical  oncology  billing  and
management.  HAMC,  KTJA,  HBS, NHMS and PX-TX all provide  medical  billing and
accounts  receivable   management,   practice   management,   transcription  and
consulting services to medical practitioners.

RECLASSIFICATION

For comparative purposes,  prior period's consolidated financial statements have
been reclassified to conform to report classifications of the current period.

BASIS OF PRESENTATION

The accompanying  unaudited condensed  consolidated interim financial statements
have  been  prepared  in  accordance  with  the  rules  and  regulations  of the
Securities and Exchange  Commission for the  presentation  of interim  financial
information,  but do not include all the information  and footnotes  required by
generally accepted accounting principles for complete financial statements.  The
audited  consolidated  financial statements for the year ended December 31, 2003
were filed on April 14, 2004 with the Securities and Exchange  Commission and is
hereby  referenced.  In the opinion of management,  all  adjustments  considered
necessary for a fair presentation have been included.  Operating results for the
nine-month period ended September 30, 2004 are not necessarily indicative of the
results that may be expected for the year ended December 31, 2004.

SEGMENT REPORTING

Statement of Financial  Accounting  Standards No. 131 ("SFAS 131"),  "Disclosure
About  Segments of an Enterprise  and Related  Information"  requires use of the
"management approach" model for segment reporting. The management approach model


                                       5
<PAGE>

                               PRACTICEXPERT, INC.

                     (FORMERLY, THAON COMMUNICATIONS, INC.)
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

is based on the way a company's management organizes segments within the company
for making operating  decisions and assessing  performance.  Reportable segments
are based on products  and  services,  geography,  legal  structure,  management
structure,  or any other  manner in which  management  disaggregates  a company.
Currently,  SFAS  131 has no  effect  on the  Company's  consolidated  financial
statements as substantially all of the Company's operations are conducted in one
industry segment.

PRINCIPLES OF CONSOLIDATION

The accompanying  financial  statements  include the accounts of  PracticeXpert,
Inc., formerly Thaon Communications,  Inc. (legal acquirer,  the "Parent"),  and
its  100%  owned  subsidiary,   Practice  Xpert  Services  Corporation  and  its
subsidiaries, Healthcare Administrative Management Corporation, K.R. Johnson and
Associates,  Healthcare Billing Solutions,  Inc., National Healthcare Management
Services,  Inc., and  PracticeXpert  of Taxes and Cancer Care Network,  Inc. All
significant  inter-company  accounts and  transactions  have been  eliminated in
consolidation.

RECENT PRONOUNCEMENTS

On May 15 2003, the FASB issued FASB Statement No. 150 ("SFAS 150"),  Accounting
for Certain Financial  Instruments with  Characteristics of both Liabilities and
Equity. SFAS 150 changes the accounting for certain financial  instruments that,
under previous guidance, could be classified as equity or "mezzanine" equity, by
now requiring  those  instruments to be classified as liabilities  (or assets in
some  circumstances) in the statement of financial position.  Further,  SFAS 150
requires  disclosure  regarding the terms of those  instruments  and  settlement
alternatives.  SFAS 150  affects an  entity's  classification  of the  following
freestanding  instruments:  a) Mandatorily  redeemable  instruments b) Financial
instruments  to  repurchase  an entity's  own equity  instruments  c)  Financial
instruments embodying obligations that the issuer must or could choose to settle
by issuing a variable  number of its shares or other  equity  instruments  based
solely on (i) a fixed monetary amount known at inception or (ii) something other
than  changes  in its own  equity  instruments  d) SFAS 150  does  not  apply to
features  embedded in a financial  instrument  that is not a  derivative  in its
entirety.  The guidance in SFAS 150 is  generally  effective  for all  financial
instruments  entered  into or  modified  after May 31,  2003,  and is  otherwise
effective at the beginning of the first interim period  beginning after June 15,
2003. For private companies,  mandatorily  redeemable financial  instruments are
subject to the  provisions  of SFAS 150 for the fiscal  period  beginning  after
December 15, 2003. The adoption of SFAS No. 149 does not have a material  impact
on the Company's financial position or results of operations or cash flows.

In December  2003,  the  Financial  Accounting  Standards  Board (FASB) issued a
revised  Interpretation  No. 46,  "Consolidation of Variable Interest  Entities"
(FIN 46R). FIN 46R addresses  consolidation by business  enterprises of variable
interest  entities and significantly  changes the  consolidation  application of
consolidation   policies  to  variable  interest  entities  and,  thus  improves
comparability  between  enterprises  engaged  in similar  activities  when those
activities are conducted  through variable interest  entities.  The Company does
not hold any variable interest entities.

In March 2004, the Emerging  Issues Task Force  ("EITF")  reached a consensus on
Issue  No.  03-1,  "The  Meaning  of  Other-Than-Temporary  Impairment  and  its
Application  to Certain  Investments."  The EITF  reached a consensus  about the
criteria  that should be used to  determine  when an  investment  is  considered
impaired,  whether that impairment is other-than-temporary,  and the measurement
of an  impairment  loss and how that criteria  should be applied to  investments
accounted for under SFAS No. 115, "ACCOUNTING IN CERTAIN INVESTMENTS IN DEBT AND
EQUITY   SECURITIES."  EITF  03-01  also  included   accounting   considerations


                                       6
<PAGE>

                               PRACTICEXPERT, INC.

                     (FORMERLY, THAON COMMUNICATIONS, INC.)
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

subsequent to the recognition of an other-than-temporary impairment and requires
certain  disclosures  about  unrealized  losses that have not been recognized as
other-than-temporary   impairments.   Additionally,   EITF  03-01  includes  new
disclosure  requirements  for  investments  that are  deemed  to be  temporarily
impaired.  In September  2004, the Financial  Accounting  Standards Board (FASB)
delayed  the  accounting  provisions  of  EITF  03-01;  however  the  disclosure
requirements remain effective for annual reports ending after June 15, 2004. The
Company will evaluate the impact of EITF 03-01 once final guidance is issued.

In April of 2004,  the EITF reached  consensus on the guidance  provided in EITF
Issue No. 03-6,  "Participating  Securities and the Two-Class  Method under SFAS
No. 128  Earnings  Per  Share"  ("EITF  03-6").  EITF 03-6  clarifies  whether a
security  should be  considered  a  "participating  security"  for  purposes  of
computing  earnings per share ("EPS") and how earnings  should be allocated to a
"participating  security"  when using the two-class  method for computing  basic
EPS.  The  adoption  of EITF  03-6  does not have a  significant  impact  on the
Company's financial position or results of operations.

In May of 2004,  the  FASB  revised  FASB  Staff  Position  ("FSP")  No.  106-1,
"Accounting  and Disclosure  Requirements  Related to the Medicare  Prescription
Drug,  Improvement  and  Modernization  Act of 2003" and issued  FSP No.  106-2,
"Accounting  and Disclosure  Requirements  Related to the Medicare  Prescription
Drug,  Improvement and Modernization  Act of 2003" ("FSP No. 106-2").  FSP 106-2
provides accounting guidance to the employers who sponsor post retirement health
care plans that provide  prescription  drug benefits;  and the prescription drug
benefit provided by the employer is "actuarially  equivalent" to Medicare Part D
and hence  qualifies  for the subsidy  under the  Medicare  amendment  act.  The
adoption  of FSP  106-2  does not have a  significant  impact  on the  Company's
financial position or results of operations.

SEC  Staff  Accounting  Bulletin  (SAB)  No.  105,  "APPLICATION  OF  ACCOUNTING
PRINCIPLES TO LOAN  COMMITMENTS,"  summarizes  the views of the staff of the SEC
regarding the application of generally  accepted  accounting  principles to loan
commitments  accounted for as derivative  instruments.  SAB No.105 provides that
the  fair  value  of  recorded  loan  commitments  that  are  accounted  for  as
derivatives  under SFAS No. 133,  "ACCOUNTING  FOR  DERIVATIVE  INSTRUMENTS  AND
HEDGING  ACTIVITIES,"  should not  incorporate  the  expected  future cash flows
related to the associated servicing of the future loan. In addition, SAB No. 105
requires  registrants to disclose their accounting  policy for loan commitments.
The provisions of SAB No. 105 must be applied to loan commitments  accounted for
as derivatives  that are entered into after March 31, 2004. The adoption of this
accounting  standard does not have a material impact on the Company's  financial
statements.

NOTE 2 - INTANGIBLE ASSETS

Intangible  assets consist of Software and Client lists.  The Company  evaluates
intangible  assets and other  long-lived  assets for impairment,  at least on an
annual basis and whenever events or changes in  circumstances  indicate that the
carrying  value may not be  recoverable  from its  estimated  future cash flows.
Recoverability  of intangible  assets and other long-lived assets is measured by
comparing their net book value to the related projected  undiscounted cash flows
from these assets,  considering  a number of factors  including  past  operating
results,  budgets,  economic projections,  market trends and product development
cycles. If the net book value of the asset exceeds the related undiscounted cash
flows,  the asset is  considered  impaired,  and a second test is  performed  to
measure the amount of impairment loss.


                                       7
<PAGE>

                               PRACTICEXPERT, INC.

                     (FORMERLY, THAON COMMUNICATIONS, INC.)
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Software:
As part of intangible assets, the Company  capitalizes certain computer software
development  costs in accordance with SFAS No. 86,  "Accounting for the Costs of
Computer  Software to be Sold,  Leased,  or Otherwise  Marketed." Costs incurred
internally to create a computer software product or to develop an enhancement to
an  existing  product  are charged to expense  when  incurred  as  research  and
development expense until  technological  feasibility for the respective product
is established.  Thereafter,  all software development costs are capitalized and
reported  at  the  lower  of   unamortized   cost  or  net   realizable   value.
Capitalization  ceases when the product or  enhancement is available for general
release to customers.

The Company makes on-going  evaluations of the recoverability of its capitalized
software  projects by comparing the amount  capitalized  for each product to the
estimated net realizable value of the product. If such evaluations indicate that
the unamortized  software development costs exceed the net realizable value, the
Company  writes off the  amount by which the  unamortized  software  development
costs exceed net realizable value.  Capitalized and purchased  computer software
development  costs are being  amortized  ratably based on the projected  revenue
associated  with the  related  software or on a  straight-line  basis over three
years, whichever method results in a higher level of amortization.

For the nine month period ended  September  30,  2004,  the Company  capitalized
internal  and  external  costs of  $164,243  incurred  to  develop  internal-use
computer  software.  Capitalized  software is amortized over a period of 5 years
using  the  straight-line  method.  Amortization  began  when the  software  was
available  for its  intended  use. The  amortization  amounts for the nine month
period ended September 30, 2004 and 2003 were $83,735 and $62,894, respectively.

Client lists:
The Company acquired intangible asset of client list through purchase of various
subsidiaries  valued at $7,453,631 as of September 30, 2004.  These client lists
are amortized  over one to nine years.  The Company  periodically  evaluates the
carrying value of long-lived  assets to be held and used in accordance with SFAS
144. The client lists consist of the following:

            K.R. Johnson               $1,023,837
            HAMC                          547,645
            HBS                            27,123
            NHCM                          447,692
            Singer Medscript              300,000
            CCN                         5,107,334
                                       ----------
                                        7,453,631
            Accumulated Depreciation    1,343,890
                                       ----------
            Client List, net            6,109,741
                                       ==========

The amortization  expenses for the period ended September 30, 2004 and 2003 were
$798,208 and $289,792, respectively.

Amortization  expenses for the  Company's  intangible  assets over the next five
twelve-month  periods are  estimated  to be:  2005-$2,230,000,  2006-$1,432,000,
2007-$740,000, 2008-$740,000 and 2009-$708,000.


                                       8
<PAGE>

                               PRACTICEXPERT, INC.

                     (FORMERLY, THAON COMMUNICATIONS, INC.)
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 3 COMMON STOCK

ISSUANCE OF SHARES FOR SERVICE

The Company accounts for the issuance of equity instruments to acquire goods and
services.  The stocks were valued at the average fair market value of the freely
trading shares of the Company as quoted on OTCBB on the date of issuance.

REGULATION S

On January 9, 2004, the Company and its management  (shareholder) entered into a
Regulation  S Stock  Purchase  Agreement  with  California  Securities  S.A. (CA
Securities)  a Panamanian  business  company.  The Company  agreed to sell to CA
Securities  in an  "offshore  transaction"  as  defined in  Regulation  S, which
transaction  had been  negotiated  outside the U.S. and  consummated  and closed
outside the U.S., and the Purchaser  agreed to purchase up to 8,000,000 Units. A
unit meant two shares of common stock of the Company.  One share was a new share
issued by the Company as part of this Reg. S Stock  Purchase  Agreement  and the
other share was sold by the  Shareholder  from their own stock.  For each unit ,
the  purchase  price  comprised of (1) $.001 per share for the share sold by the
shareholders  and (2) Per "purchase price" for the shares issued by the Company.
"Purchase  Price" for the Company  Share was the Share Price  multiplied by 30%.
"Share  Price"  was the  closing  bid price (on the  OTCBB)  multiplied  by 90%.
Proceeds paid to the Seller were  allocated  $.001 for each share to Shareholder
and the balance to the Company.  The Purchaser agreed to use its best efforts to
purchase up to 8 million  Units  between the date hereof and May 30, 2004 ("Best
Efforts  Period").  For the period ended  September 30, 2004, the Company issued
5,226,906 shares of common stock under Regulation S Offering amounting $795,161.

On April 28, 2004, the Company  completed the sale of $5.8 million of its common
stock and warrants to certain purchasers. The Company sold 48,333,347 restricted
shares  of its  common  stock  at a  purchase  price of $0.12  per  shares.  The
purchasers  received five-year warrants to purchase  48,333,347 shares of common
stock at an  exercise  price of $0.30 per share.  Pursuant  to the  Registration
Rights  Agreement the Company has agreed to prepare and file with the Securities
and Exchange  Commission  a  registration  statement  covering the resale of the
restricted  shares  of its  common  stock and  common  stock  issuable  upon any
exercise of the  warrants.  As a result,  during the period ended  September 30,
2004, the Company issued 52,171,169 shares of common stock including warrants of
3,837,822  for  cash  amounting  to  $5,183,027,  net of  commissions  amounting
$616,973.  $20,000 of cash was received in the prior  period.

During the period ended September 30, 2004, the Company issued  1,163,160 shares
of common stock for cash receipt of $272,418.

As of  September  30, 2004,  the Company has  received  $35,000 for shares to be
issued.

During the period ended  September 30, 2004,  the Company issued common stock in
exchange of various services to following parties:

The  Company  issued  231,222  shares of common  stock for legal and  consulting
services amounting  $101,456.  The Company issued 925,395 shares of common stock
for finder fees and investor relations  amounting  $506,327.  The Company issued
55,000 shares of common stock for salary amounting  $24,250.  The Company issued
62,000 shares for interest amounting $17,335.


                                       9
<PAGE>

                               PRACTICEXPERT, INC.

                     (FORMERLY, THAON COMMUNICATIONS, INC.)
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

As of  September  30,  2004,  the Company  has  837,911  shares to be issued for
services and interest amounting $207,040.

The  Company  issued  591,152  shares  for  dividends  on  Series D  convertible
Preferred stock amounting $310,000.  The Company issued 187,598 shares valued at
$22,512 for payment of $108,000  dividends on convertible  Preferred  stock. The
difference amount of $85,488 was record as a gain on settlement of debt.

During the nine month period ended September 30, 2004, the Company issued 50,000
shares of common  stock  valued at  $24,500  to settle  note  payable  amount of
$10,000.  The difference amount of $14,500 was record as a loss on settlement of
debt.

The subscription receivable which was outstanding as of December 31, 2003 for an
amount of $35,000 and was received in the period ended September 30, 2004.

During  the  period  ended  September  30,  2004,  1,650,000  shares of Series A
convertible  Preferred  stock  plus  dividend  of  $131,750  were  converted  to
3,094,928 shares of common stock.

During  the  period  ended  September  30,  2004,  197,783  shares  of  Series B
convertible Preferred stock plus dividend of $22,709 were converted to 2,015,153
shares of common stock.

During  the  period  ended  September  30,  2004,  1,942,566  shares of Series C
convertible  Preferred  stock  plus  dividend  of  $153,110  were  converted  to
29,392,826 shares of common stock.

During  the  period  ended  September  30,  2004,  100,000  shares  of  Series D
convertible  Preferred  stock plus dividend of $18,000 were converted to 204,968
shares of common stock.

During  the  period  ended  September  30,  2004,  120,000  shares  of  Series E
convertible  Preferred  stock plus dividend of $21,100 were converted to 275,050
shares of common stock.

During  the  period  ended  September  30,  2004,  50,000  shares  of  Series  F
convertible  Preferred  stock plus dividend of $13,000 were converted to 521,595
shares of common stock. In addition,  138,859 shares of common stock were issued
for 13,333 shares of un-issued shares of Series F convertible Preferred stock.

During the period  ended  September  30,  2004,  826,500  shares were issued for
acquisition of CCN valued at $500,000.

PREFERRED STOCK

During the period ended September 30, 2004, all of outstanding  shares of Series
A, B, D, E and F convertible  Preferred  stock plus  dividends were converted to
common stock.

During  the  period  ended  September  30,  2004,  1,942,566  shares of Series C
convertible Preferred stock out of a total of 1,983,736 outstanding shares, plus
dividends amounting  $153,110,  were converted to common stock which resulted in
remaining balance of 41,170 outstanding shares.

The Series C  convertible  Preferred  stock is  entitled to receive 6% per annum
dividend, in preference to any other class. Class C convertible Preferred stock,
at the  option of the holder  thereof,  is  convertible  into 15 share of common
stock, The holders of Series C convertible stock shall be paid out of the assets
of the Company  prior and in preference  to any payment or  distribution  out of


                                       10
<PAGE>

                               PRACTICEXPERT, INC.

                     (FORMERLY, THAON COMMUNICATIONS, INC.)
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

assets  to the  holders  of the  common  stock or any  other  class of series of
capital  stock of the Company but  subordinate  to any  dividend  preference  of
Series A, D, E and F  Preferred  shares of the Company in amount per share equal
to $1.00 plus all declared but unpaid dividends on such shares to the date fixed
for distribution. The holders of Series C convertible Preferred stock shall have
the voting rights such holder's  shares of Series C Preferred are converted into
shares of common stock at which time the holder shall have the voting  rights of
the holders of common stock shares.

NOTE 4 - SUPPLEMENTAL DISCLOSURE OF CASH FLOWS

The Company  prepares its statements of cash flows using the indirect  method as
defined under the Financial Accounting Standard No. 95.

The Company paid $1,600 for income tax and $181,650 for interest during the nine
month period ended  September  30, 2004.  The Company paid $0 for income tax and
$52,839 for interest during the nine month period ended September 30, 2003.

The cash  flow  statements  do not  include  following  non-cash  investing  and
financing activities:

The  Company  issued  231,222  shares of common  stock for legal and  consulting
services amounting  $101,456.  The Company issued 925,395 shares of common stock
for finder fees and investor relations  amounting  $506,327.  The Company issued
55,000 shares of common stock for salary amounting  $24,250.  The Company issued
62,000 shares for interest amounting $17,335.

As of  September  30,  2004,  the Company  has  837,911  shares to be issued for
services and interest amounting $207,040.

The  Company  issued  591,152  shares  for  dividends  on  Series D  convertible
Preferred stock amounting $310,000.  The Company issued 187,598 shares valued at
$22,512 for payment of $108,000  dividends on convertible  Preferred  stock. The
difference amount of $85,488 was record as a gain on settlement of debt.

During the nine month period ended September 30, 2004, the Company issued 50,000
shares of common  stock  valued at  $24,500  to settle  note  payable  amount of
$10,000.

During  the  period  ended  September  30,  2004,  1,650,000  shares of Series A
convertible  Preferred  stock  plus  dividend  of  $131,750  were  converted  to
3,094,928 shares of common stock.

During  the  period  ended  September  30,  2004,  197,783  shares  of  Series B
convertible Preferred stock plus dividend of $22,709 were converted to 2,015,153
shares of common stock.

During  the  period  ended  September  30,  2004,  1,942,566  shares of Series C
convertible  Preferred  stock  plus  dividend  of  $153,110  were  converted  to
29,392,826 shares of common stock.

During  the  period  ended  September  30,  2004,  100,000  shares  of  Series D
convertible  Preferred  stock plus dividend of $18,000 were converted to 204,968
shares of common stock.

During  the  period  ended  September  30,  2004,  120,000  shares  of  Series E
convertible  Preferred  stock plus dividend of $21,100 were converted to 275,050
shares of common stock.


                                       11
<PAGE>

                               PRACTICEXPERT, INC.

                     (FORMERLY, THAON COMMUNICATIONS, INC.)
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

During  the  period  ended  September  30,  2004,  50,000  shares  of  Series  F
convertible  Preferred  stock plus dividend of $13,000 were converted to 521,595
shares of common stock. In addition,  138,859 shares of common stock were issued
for 13,333 shares of un-issued shares of Series F convertible Preferred stock.

During the period  ended  September  30,  2004,  826,500  shares were issued for
acquisition of CCN valued at $500,000.

NOTE 5 - BASIC AND DILUTED NET LOSS PER SHARE

Basic and diluted net loss per share for the nine month ended September 30, 2004
and 2003 were  determined  by dividing  net loss for the periods by the weighted
average  number of both  basic and  diluted  shares of common  stock and all the
convertible  preferred  stock are regarded as common stock  equivalents  and are
considered in diluted net loss per share calculations.

The following is a  reconciliation  of the  numerators and  denominators  of the
basic and diluted earnings per share  computation for the period ended September
30, 2003:

<TABLE>
<CAPTION>
                                               Net Inc.(loss)     Shares       Per Share
<S>                                            <C>             <C>            <C>
Basic earnings per shares:
Loss from continuing operations                  (2,850,435)
Loss from operation to be disposed, net              (4,793)
Gain on disposal of subsidiary, net               3,433,069
Dividend requirement for preferred stock           (296,356)
                                               ------------
 Net income available to common stockholders        281,485       8,807,296   $       0.03
                                               ============    ============   ============
Effect of dilutive securities:
     Convertible preferred stock                                 35,571,494

                                               ------------    ------------   ------------
Diluted earnings per share:                         281,485      44,378,790   $       0.01
                                               ============    ============   ============
</TABLE>

Weighted  average  number of shares used to compute  basic and diluted  loss per
share is the same for the period  ended  September  30, 2004 since the effect of
dilutive securities is anti-dilutive.

NOTE 6 - GOING CONCERN

The  accompanying  financial  statements  have been prepared in conformity  with
generally accepted accounting principle,  which contemplate  continuation of the
Company as a going  concern.  However,  the Company has  accumulated  deficit of
$9,991,135  as of  September  30,  2004  including  the  current  period loss of
$2,361,191.  The continuing losses have adversely  affected the liquidity of the
Company. The Company faces continuing significant business risks including,  but
not limited to, its ability to maintain  vendor and  supplier  relationships  by
making timely payments when due.

In view of the matters described in the preceding paragraph, recoverability of a
major portion of the recorded  asset amounts shown in the  accompanying  balance
sheet is dependent  upon continued  operations of the Company,  which in turn is
dependent  upon the  Company's  ability  to  raise  additional  capital,  obtain
financing and to succeed in its future operations.  The financial  statements do
not include any adjustments relating to the recoverability and classification of
recorded asset amounts or amounts and  classification  of liabilities that might
be necessary should the Company be unable to continue as a going concern.

Management  has taken the following  steps to revise its operating and financial
requirements,  which it believes are  sufficient to provide the Company with the


                                       12
<PAGE>

                               PRACTICEXPERT, INC.

                     (FORMERLY, THAON COMMUNICATIONS, INC.)
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

ability to continue as a going concern.  Management devoted  considerable effort
during the period ended  September 30, 2004,  towards (i)  obtaining  additional
equity  financing (ii)  controlling  of salaries and general and  administrative
expenses, and (iii) management of accounts payable.

In that  regard,  on March 1, 2004,  the Company  purchased  all the assets from
Singer Mediscript and on April 28, 2004, the Company completed an acquisition of
Cancer Care Network, Inc. (note 7)

NOTE 7 - ACQUISITION

On March 1, 2004, the Company  consummated its asset acquisition  agreement with
Singer MedScript, a medical transcription company located in Houston, Texas. The
agreement   was   consummated   by  the   Company's   wholly-owned   subsidiary,
PracticeXpert of Texas,  Inc., which agreed to acquire  substantially all of the
assets and assume certain  liabilities and obligations of Singer MedScript for a
purchase  price of $300,000 from the sole  proprietor of Singer  MedScript.  The
purchase  price  consisted  of a cash payment of $150,000 at the closing and the
issuance of a promissory note for $150,000 which bears interest of eight percent
(8%) per annum and payable in 36 monthly  installments of principal and interest
commencing on April 1, 2004.

A summary of the assets acquired and consideration for is as follows:

                                             Allocated
                   Assets Acquired              Amount
                   ---------------              ------
                   Client lists acquired     $ 300,000
                                             =========

Management  allocated  the  purchase  price to the basis of the assets  acquired
based on management's appraisals at the date of acquisition.

                   Consideration paid      Amount
                   ------------------      ------
                   Cash                   $150,000
                   Promissory note         150,000
                                           -------

                                          $300,000
                                          ========

On April 28, 2004, the Company consummated its asset acquisition  agreement with
Cancer Care Network,  Inc., an Oklahoma  corporation,  located in Oklahoma City,
Oklahoma.  Cancer  Care  Network,  Inc.  specializes  in  radiation  and medical
oncology billing and management. The acquisition was consummated by the Company,
Practice Xpert Services Corp., and PracticeXpert of Oklahoma, Inc., wholly-owned
subsidiaries of the Company,  which agreed to acquire  substantially  all of the
assets and assume certain  liabilities  and  obligations of Cancer Care Network,
Inc. for a purchase price of $5,500,000.  The purchase price consisted of a cash
payment of $4,100,000  and the issuance of $500,000 in shares of common stock at
the  closing and the  issuance of a  promissory  note for  $900,000  which bears
interest of six and one-half  percent (6.5%) per annum and payable in 12 monthly
installments of principal and interest commencing on April 25, 2004. As a result
of this  acquisition,  the  Company  expects  that CCN will  give the  Company a
platform and base of operations for the Oklahoma  medical  billing  services.

A summary of CCN assets acquired,  liabilities  assumed and consideration for is
as follows:

                                      Allocated
                                         Amount
                                    -----------
            Current assets          $   232,727
            Client lists              5,107,334
            Property & equipment        233,667
            Accrued liabilities         (73,728)
                                    -----------
                                    $ 5,500,000

             Consideration paid          Amount
                                    -----------
             Cash                   $ 4,100,000
             Promissory note            900,000
             Common Stock               500,000
                                    -----------
                                    $ 5,500,000


                                       13
<PAGE>

NOTE 8 -   COMMITMENTS

The Company has office lease  agreements for 7 and 8 years.  Future  commitments
under operating leases are as follows for the twelve months ending September 30:

                     2005                          170,606
                     2006                          173,242
                     2007                          178,380
                     2008                          104,752
                     2009                          100,294
                     Remaining after 5 yrs          16,784
                                                ----------
                 Total minimum lease payment    $  744,058
                                                ==========

The rent  expenses  were  $234,798  and $121,076 for the nine month period ended
September 30, 2004 and 2003, respectively.

NOTE 9 - INCOME TAXES

No  provision  was made for other  entities on the Federal  income tax since the
Company has  significant  net operating  loss.  Through  September 30, 2004, the
Company  incurred  net  operating  losses  for  tax  purposes  of  approximately
$2,728,976.  The net operating loss carry forwards may be used to reduce taxable
income  through the year 2024. The  availability  of the Company's net operating
loss carry forwards are subject to limitation if there is a 50% or more positive
change in the ownership of the Company's  stock.  The provision for income taxes
consists of the state minimum tax imposed on corporations.

Temporary differences which give raise to deferred tax assets and liabilities at
September 30, 2004 comprised  mainly of net operating  loss carry  forward.  The
gross  deferred  tax asset  balance as of September  30, 2004 was  approximately
$928,000.  A 100%  valuation  allowance  has been  recorded for the deferred tax
assets due to the uncertainty of its realization.


                                       14
<PAGE>

ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS.

The following  discussion and analysis  should be read in  conjunction  with the
Company's financial statements, including the notes thereto, appearing elsewhere
in this Report.

THIS  QUARTERLY  REPORT ON FORM 10-QSB  CONTAINS  STATEMENTS  RELATING TO FUTURE
RESULTS OF THE COMPANY (INCLUDING CERTAIN  PROJECTIONS AND BUSINESS TRENDS) THAT
ARE "FORWARD-LOOKING STATEMENTS" AS DEFINED IN THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995. ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE PROJECTED AS
A RESULT OF  CERTAIN  RISKS AND  UNCERTAINTIES,  INCLUDING  BUT NOT  LIMITED  TO
CHANGES IN POLITICAL AND ECONOMIC  CONDITIONS,  DEMAND FOR AND MARKET ACCEPTANCE
OF NEW AND EXISTING PRODUCTS, AS WELL AS OTHER RISKS AND UNCERTAINTIES  DETAILED
FROM TIME TO TIME IN THE FILINGS OF THE COMPANY WITH THE SECURITIES AND EXCHANGE
COMMISSION.

OVERVIEW

      PracticeXpert,   Inc.,  a  Nevada   corporation   (the   "Company"),   was
incorporated on July 13, 1984. Subsequently the Company went through a series of
name changes and changes in its business  activities.  On November 27, 2000, the
Company changed its name to Thaon Communications,  Inc ("Thaon").  As Thaon, the
Company acquired and/or started a number of media and communications businesses,
all of which were ultimately discontinued or sold.

      On April 11, 2003,  the Company  entered into a stock  purchase  agreement
(the "Purchase  Agreement")  with Practice  Xpert  Services  Corp., a California
corporation ("PXSC").  Pursuant to the Purchase Agreement, which closed on April
11,  2003,  the Company  purchased  92% of PXSC's  outstanding  common  stock in
exchange for newly issued shares of the Company's common stock and shares of the
Company's  Preferred  Series C stock to  former  owners  of PXSC  (the  "Selling
Shareholders").  As a group, the Selling  Shareholders  received 7,670,596 (post
split) shares of common stock and 1,845,000  shares of Preferred Series C stock,
constituting  72.75% of the Company's voting  securities.  As a condition of the
Purchase Agreement,  on April 11, 2003, the officers of the Company resigned and
the board of directors  appointed officers of PXSC's as the Company's  officers.
On  September  30,  2003,  the  Company  purchased  the  remaining  8% of PXSC's
outstanding  common stock that it did not own by issuing  472,860  shares of the
Company's  common stock and 111,736  shares of  Preferred  Series C stock to the
remaining PXSC stockholders.

      On or about July 15, 2003 the  Company  filed a revision to it articles of
incorporation  with  the  State of  Nevada  and  changed  its  name  from  Thaon
Communications,  Inc.  to  PracticeXpert,  Inc.,  so that its name would  better
reflect the business of the Company.

      In accordance with our strategy to grow, in part,  through the acquisition
of companies  providing  practice  management,  billing and related  services to
physicians,  the Company  completed  two  acquisitions  during  2003,  acquiring


                                       15
<PAGE>

Healthcare Billing Solutions,  Inc., Great Falls,  Montana,  and National Health
Care Management Services, Inc., Buckhannon, West Virginia.

      Continuing on with our strategy of acquiring physician services companies,
on March 1, 2004 the Company  completed the acquisition of Singer  MedScript,  a
medical  transcription  company located in Houston,  Texas, for $150,000 in cash
and a $150,000 interest bearing note payable over three years.

      On April 28, 2004 the Company  completed  the  acquisition  of Cancer Care
Network, a medical billing and practice management services company specializing
in radiation oncology,  and located in Oklahoma City, Oklahoma, for $4.1 million
in cash,  $500,000  worth of the  Company's  common  stock,  and a $900,000 note
payable over ten months.

      During August, 2004 the Company made the decision to dispose of Healthcare
Billing  Solutions,  Inc. ("HBS") effective  September 1, 2004. The Company,  in
agreement  with the  previous  owner of HBS,  made the  decision  to rescind the
purchase and sale of stock agreement  entered into  previously.  The transaction
had not been consummated as of November 15, 2004. The operating results from HBS
for  eight-month  period ended August 31, 2004 were presented  separately in the
financial statements as "Loss from operation to be disposed, net".

RESULTS OF OPERATIONS

      The following sections discuss the results of operations for the three and
nine  month  periods  ended  September  30,  2004  compared  to the  results  of
operations  for the three and nine month  periods  ended  September 30, 2003 and
were derived from our financial  statements  and notes thereto  included in this
quarterly report which are unaudited,  and related records.  Historical  results
are not  necessarily  indicative  of results that may be expected for any future
period.  The following  information and data should be read in conjunction  with
our unaudited  financial  statements,  including the related  footnotes and with
reference to certain additional information previously reported in the Company's
annual report on Form 10-KSB for the year ended December 31, 2003 and previously
filed with the Securities and Exchange Commission.

      Net revenue was $3,754,149  for the three months ended  September 30, 2004
compared to net revenue of $883,065  for the three months  ended  September  30,
2003. Revenues in the 2004 period were greater as a result of new business,  and
as a result of the acquisitions completed from July 2003 through June 2004.

      Net revenue was  $7,375,558  for the nine months ended  September 30, 2004
compared to net revenue of  $2,325,710  for the nine months ended  September 30,
2003. Revenues in the 2004 period were greater as a result of new business,  and
as a result of the acquisitions completed from July 2003 through June 2004.

      During the second quarter of 2004 we began to report revenue and operating
expenses in two distinct  revenue  classifications  "Medical billing and related
services"  and  "Management  services".  Medical  billing and  related  services
includes medical billing,  practice  management,  transcription,  consulting and
other services provided directly to physician customers, for specific and agreed
upon  fees.   Management   services   includes  certain  contracts  under  which


                                       16
<PAGE>

PracticeXpert  manages  specified  medical  facilities,  and participates in the
profitability of the facility, along with the owners of the facility. During the
quarter,  revenue from Medical  billing and related  services was $2,377,333 and
revenue  from  Management  services  was  $1,376,816.  For the nine month period
revenue from Medical  billing and related  services was  $5,064,230  and revenue
from Management services was $2,311,328.

      Our operating  expenses for the three months ended September 30, 2004 were
$4,801,947 compared to $1,468,192 for the three months ended September 30, 2003.
Operating  expenses  increased  in 2004 over  2003 due to  expenses  related  to
servicing new business, the added costs from the operations of new acquisitions,
costs associated with audits of acquired subsidiaries, costs associated with the
amortization of acquired client lists,  new sales and marketing  initiatives and
expenses related to the continued pursuit of acquisition opportunities.

      Our operating  expenses for the nine months ended  September 30, 2004 were
$9,399,580  compared  to  $3,374,522  for the nine months  ended June 30,  2003.
Operating  expenses  increased  in 2004 over  2003 due to  expenses  related  to
servicing new business, the added costs from the operations of new acquisitions,
costs  associated with audits of acquired  subsidiaries,  costs  associated with
amortization of acquired client lists,  new sales and marketing  initiatives and
expenses related to the continued pursuit of acquisition opportunities.

      Under  Management  services,   PracticeXpert  includes  in  its  operating
expenses  the  expenses  of  operating  a specific  cancer  treatment  facility.
Included in those  expenses  are the costs of drugs  administered  to  patients.
Historically,  these drugs have been  purchased  and  immediately  expensed,  as
typically these drugs are used within a short period of their purchase. However,
these drugs  represent a  significant  cost,  and if drugs are purchased and not
used immediately,  the result will be a spike in operating expenses, in relation
to revenues. During the quarter ended September 30, 2004, approximately $150,000
worth of drugs were  purchased,  and not used in the  quarter,  yet the costs of
these  drugs was  included  in  operating  expenses.  In order to  better  match
revenues  and  expenses  going  forward,  management  has made the  decision  to
implement an inventory system such that the costs of drugs can be properly match
against the revenue associated with the utilization of those drugs

      We had a net loss of $1,023,073, or a basic and fully diluted net loss per
common share of $0.01, for the three months ended September 30, 2004 compared to
a net  income  of  $1,090,306,  or a basic net  income  per share of $0.11 and a
diluted  net  income  per  common  share of $0.02,  for the three  months  ended
September  30, 2003.  The net loss for the current  three month period  includes
$624,063 in depreciation and  amortization,  $226,625 of expenses paid in stock,
including a one time fee related to the  acquisition  of Cancer Care  Network of
$180,000.  The net income of $1,090,306 for the comparable  nine month period in
2003   included  a  $3,433,069   one-time   gain  on  the  disposal  of  certain
non-operating subsidiaries.

      We had a net loss of $2,361,191, or a basic and fully diluted net loss per
common share of $0.03,  for the nine months ended September 30, 2004 compared to
a net income of $281,485,  or a basic net income per common share of $0.03 and a
diluted net income per common share of $0.01, for the nine months ended June 30,
2003.  The net loss for the current nine month  period  includes  $1,190,377  in
depreciation  and  amortization,  $856,408  of expenses  paid in stock,  $75,750
related to a settlement  of  litigation,  $70,988 in gains on the  settlement of
debts, $63,740 in accrued dividends payable on preferred stock and a $163,708 in
one-time fees related to the payoff of the our working capital  facility.  (See,
Liquidity and Capital  Resources)  The net income of $281,485 for the comparable
nine month period in 2003 included a $3,433,069 one-time gain on the disposal of
certain non-operating subsidiaries.

      During  August,  2004 the  Company  made the  decision  to  dispose of HBS
effective  September 1, 2004. The Company,  in agreement with the previous owner
of HBS,  made the decision to rescind the  purchase and sale of stock  agreement
entered  into  previously.  The  transaction  had  not  been  consummated  as of
September 30, 2004. The operating results from HBS for eight-month  period ended
August 31, 2004 were presented  separately in the financial  statements as "Loss


                                       17
<PAGE>

from operation to be disposed, net". The Company made the decision to dispose of
this  subsidiary due to its small size.  Management has determined that focusing
on acquisitions and business units with greater revenues and revenue  generating
capacity is more closely aligned with the overall  corporate  strategy of growth
through acquisitions.

      As of September  30,  2004,  we had  approximately  105  customers,  which
included  approximately  400 physicians,  and we had  approximately 70 hand-held
devices  utilizing  our  PXpert  patient  encounter  system  being  used  by our
customers.

LIQUIDITY AND CAPITAL RESOURCES

      As of  September  30,  2004,  PracticeXpert  had $199,583 in cash and cash
equivalents.  Current assets at September 30, 2004 were $1,846,236,  compared to
current  liabilities of $3,507,190,  resulting in a working  capital  deficit of
$1,660,954.  This compares to a working  capital deficit at December 31, 2003 of
$2,008,291  and at June 30, 2004 of  $1,508,324.  Of the current  liabilities at
September 30, 2004,  $15,306  relates to dividends  payable on Preferred  Stock,
which may be paid in shares of common stock at the  Company's  option,  $422,781
relates to advances from  investors  for stock not yet issued and  approximately
$589,372 is due to, or advances from,  officers,  directors and former owners of
PracticeXpert subsidiary companies.

      Our only sources of liquidity  are our bank  accounts,  our unused  credit
facilities,  which at September 30, 2004 were fully drawn and our  revenues.  We
received $6,029,131, net of commissions and finders fees, during the nine months
ended  September 30, 2004 from the sale of stock to investors,  and were able to
acquire $856,408 worth of services in exchange for stock. During the nine months
ended September 30, 2004 we used $257,475 in capital to fund operations, we used
$1,185,185 to pay principal  payments on notes payable,  we invested $164,243 in
further  development  of the  PXpert  Revenue  Management  System  software,  we
purchased equipment for operations  totaling $139,431,  we used $150,000 for the
acquisition of Singer  MedScript and we used $4.1 million as the cash portion of
the  purchase  price of  Cancer  Care  Network.  We  continue  to seek  capital,
primarily for expansion plans.

      During April,  2004 the Company raised $5.8 million  (before  commissions)
through a private  placement  offering.  The $5.8 million offering was privately
placed by New York  investment  banking firm, H. C.  Wainwright & Co. Inc. Under
the terms of the private  placement the investors  purchased  restricted  common
stock at a price of $0.12 per  share,  and for each share  purchased  received a
warrant to purchase an additional share at $.30. The Company has registered with
the  Securities  and Exchange  Commission  all of the shares of common stock and
shares of common stock  underlying  warrants  issued in such  private  placement
pursuant to its Form SB-2  Registration  which was declared  effective on August
13, 2004.

      Due to numerous  economic and competitive  risks,  any or all of which may
have a material  adverse impact upon our  operations,  there can be no assurance
that we will be able to successfully  generate significant revenues or achieve a
level of profits which will permit us to stay in business.  However,  we believe
cash  generated  from net revenues will be sufficient to fund all of our general
and administrative expenditures for the next twelve months.


                                       18
<PAGE>

FLUCTUATIONS IN OPERATING RESULTS; SEASONALITY

      Annual and  quarterly  fluctuations  in our results of  operations  may be
caused by the timing and the amount of payments received by our customers,  upon
which our  revenues  are based.  Our future  results  also may be  affected by a
number of factors,  including  our ability to offer our services at  competitive
prices and to anticipate  customer demands.  Our results may also be affected by
economic  conditions in the geographical  areas in which we operate.  All of the
foregoing may result in substantial  unanticipated quarterly earnings shortfalls
or  losses.  Due to  all of the  foregoing,  we  believe  that  period-to-period
comparisons  of our results of operations  are not  necessarily  meaningful  and
should not be relied upon as indicative of future performance.

INFLATION

      We  believe  that our  revenue  and  results of  operations  have not been
significantly impacted by inflation since we began operations.

SUBSEQUENT EVENTS

None.

ITEM 3. CONTROLS AND PROCEDURES

      Our President and Chief Financial Officer (the "Certifying  Officers") are
responsible for establishing and maintaining  disclosure controls and procedures
for the Company.  The Certifying Officers have designed such disclosure controls
and  procedures  to ensure  that  material  information  is made  known to them,
particularly during the period in which this report was prepared. The Certifying
Officers have evaluated the effectiveness of the Company's  disclosure  controls
and  procedures  as of the end of the period  covered by this report and believe
that the Company's disclosure controls and procedures are effective based on the
required  evaluation.  During the period  covered by this report,  there were no
changes in internal controls that materially affected,  or are reasonable likely
to materially affect, the Company's internal control over financial reporting.


                                       19
<PAGE>

                           PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

      The Company was named as a defendant in an action entitled S2 Consultants,
LLC and Westminster Securities Corporation,  Plaintiffs, v. PracticeXpert, Inc.,
Defendant,  filed in the United  States  District  Court for the District of New
Jersey on August 10, 2004. The complaint in the action contains two counts,  the
first  alleging  breach of contract by the Company and the second count  alleges
unjust  enrichment for  unspecified  damages  purportedly  caused by the alleged
non-payment  of a finder's fee due in  connection  with  arranging the Company's
$5.8 million private  placement  transaction which closed on April 28, 2004, and
the  acquisition of Cancer Care Network,  Inc. The complaint also seeks recovery
of the  plaintiffs'  attorney's  fees and costs,  and  interest on the  alledged
amounts claimed by plaintiffs in the action.

      In addition to the  proceedings  described  above, in the normal course of
business,  we are  subject to  proceedings,  lawsuits  and other  claims.  These
matters are subject to many  uncertainties and outcomes that are not predictable
with assurance.  Consequently, we are unable to ascertain the ultimate aggregate
amount of monetary liability or financial impact with respect to these matters.


ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

      During the period ended June 30,  2004,  the Company  sold  5,226,906  net
shares of common stock under Regulation S for $795,161.  Under this transaction,
the Company  issued a total of 10,453,812 of shares to the investor and Jonathan
Doctor, Chief Executive Officer,  Michael Manahan,  Chief Financial Officer, and
Zima Hartz, Executive Vice President, of PracticeXpert, agreed, as an inducement
to the  investor,  to return one share of management  stock to the Company,  for
every two shares of stock purchased by the private  investor.  Subsequent to the
end of  the  first  quarter  the  transaction  with  the  private  investor  was
completed,  and in accordance with the agreement,  management returned 5,226,906
shares of stock to the Company.

      On April 28, 2004,  the Company  completed the sale of $5.8 million of its
common stock and  warrants to certain  purchasers.  The Company sold  48,333,347
restricted  shares of its common  stock at a purchase  price of $0.12 per share.
The purchasers  received  five-year  warrants to purchase  48,333,347  shares of
common stock at an exercise price of $0.30 per share.  Pursuant to the Form SB-2
Registration  Statement  of the  Company  that  was  declared  effective  by the
Securities  Exchange  Commission on August 13, 2004,  the Company has registered
the resale of the  shares of common  stock and common  stock  issuable  upon any
exercise of the warrants issued in the foregoing transaction.

      During the nine month period ended  September  30, 2004,  the Company sold
1,163,160 shares of restricted common stock for $272,418.

      During the nine month period ended  September 30, 2004, the Company issued
common  stock in exchange  for various  services as follows:  231,222  shares of
common  stock for legal and  consulting  services  valued at  $106,456;  925,395


                                       20
<PAGE>

shares  of  common  stock  for  finder  fees and  investor  relations  valued at
$506,327;  55,000  shares of common  stock for employee  compensation  valued at
$24,250;  and  62,000  shares of common  stock  valued at  $17,335 in payment of
interest.

      During the nine month period ended  September 30, 2004, the Company issued
50,000  shares of common stock valued at $24,500 to settle a note payable in the
amount of $10,000.  The difference of $14,500 was record as a loss on settlement
of debt.

      The  subscription  receivable that was outstanding as of December 31, 2003
for $35,000 was received during the nine month period ended September 30, 2004.

      During the nine month period ended September 30, 2004, 1,650,000 shares of
Series A  convertible  Preferred  stock plus related  dividends of $131,750 were
converted  to  3,094,928  shares of  common  stock;  197,783  shares of Series B
convertible  Preferred stock plus related dividends of $22,709 were converted to
2,015,153  shares  of common  stock;  1,942,566  shares of Series C  convertible
Preferred stock plus related  dividends of $153,110 were converted to 29,392,826
shares of common stock;  100,000 shares of Series D convertible  Preferred stock
plus related  dividends of $18,000  were  converted to 204,968  shares of common
stock;  120,000  shares of Series E  convertible  Preferred  stock plus  related
dividends of $21,100 were  converted to 275,050  shares of common stock;  50,000
shares of Series F convertible Preferred stock plus related dividends of $13,000
were converted to 521,595 shares of common stock. In addition, 138,859 shares of
common  stock  were  issued for 13,333  shares of  un-issued  shares of Series F
convertible Preferred stock.

      During the nine month period ended  September 30, 2004,  826,500 shares of
common stock were issued for acquisition of CCN valued at $500,000.

      During the nine  month  period  ended  September  30,  2004,  the  Company
received $35,000 for shares that have yet to be issued.

      During the nine  month  period  ended  September  30,  2004,  the  Company
received services and incurred interest charges valued at $207,040, for which it
is obligated to issue 837,911 shares of common stock.

      During the nine month period ended  September 30, 2004, the Company issued
591,152 shares,  value at $310,000,  for accrued  dividends  payable on Series D
convertible Preferred stock. The Company issued 187,598 shares valued at $22,512
for payment of $108,000 in accrued dividends on convertible Preferred stock. The
difference of $85,488 was record as a gain on settlement of debt.


ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.



                                       21
<PAGE>

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

None.


ITEM 5. OTHER INFORMATION

None.


ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

1. The following Exhibits are filed herein:

      No.   Title

      31.1  Certification of Chief Executive  Officer and President  pursuant to
            the  Securities  Exchange Act of 1934,  Rules 13a-14 and 15d-14,  as
            adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
      31.2  Certification of Chief Financial  Officer pursuant to the Securities
            Exchange Act of 1934,  Rules 13a-14 and 15d-14,  as adopted pursuant
            to Section 302 of the Sarbanes-Oxley Act of 2002
      32.1  Certification  pursuant  to  18  U.S.C.  Section  1350,  as  Adopted
            Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

2.    Reports on Form 8-K filed:

      (a)   On September 7, 2004, the Registrant filed a Form 8-K/A to amend the
Registrant's current reports on Form 8-K dated March 16, 2004, and May 13, 2004.


                                       22
<PAGE>

                                   SIGNATURES


In accordance with the  requirements of the Exchange Act, the registrant  caused
this  report to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.

                            PRACTICEXPERT, INC.


DATED: November 19, 2004    By: /s/ Jonathan Doctor
                                -------------------
                                Jonathan Doctor
                                Chief Executive Officer and President, Director
                                (Principal Executive Officer)


DATED: November 19, 2004    By: /s/ Michael Manahan
                                -------------------
                                Michael Manahan
                                Chief Financial Officer, Director
                                (Principal Financial Officer and
                                Principal Accounting Officer)


                                       23
<PAGE>

                                INDEX TO EXHIBITS

      No.   Title

      31.1  Certification of Chief Executive  Officer and President  pursuant to
            the  Securities  Exchange Act of 1934,  Rules 13a-14 and 15d-14,  as
            adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

      31.2  Certification of Chief Financial  Officer pursuant to the Securities
            Exchange Act of 1934,  Rules 13a-14 and 15d-14,  as adopted pursuant
            to Section 302 of the Sarbanes-Oxley Act of 2002

      32.1  Certification  Pursuant  to  18  U.S.C.  Section  1350,  as  adopted
            pursuant to Section 906 of the Sarbanes-Oxley Act of 2002



                                       24