**U.S.
      SECURITIES AND EXCHANGE COMMISSION**


**WASHINGTON,
      D.C. 20549**




**FORM
      10-KSB**




**ANNUAL
      REPORT UNDER SECTION 13 or 15 (d) OF**




**THE
      SECURITIES EXCHANGE ACT OF 1934**




For
      the
      fiscal year ended December 31, 2006




*Commission
      file number 00-30585*




**CREATIVE
      VISTAS, INC.**




**(Exact
      name of registrant as specified in its charter)**




Arizona
            3669
            86-0464104(State
                or other jurisdiction of incorporation or organization
            (Primary
                Standard Industrial Classification Code Number)
            (I.R.S.
                Employer Identification No.)




2100
                Forbes Street
              Unit
                8-10
              Whitby,
                Ontario, Canada L1N 9T3
              (905)
                666-8676(Address
                of principal executive offices)Registrant’s
                telephone number, including area code:(905)
                666-8676Securities
                registered pursuant to Section 12 (b) of the Exchange Act:NoneSecurities
                registered pursuant to Section 12 (g) of the Exchange Act:




Title
                of Class
            
            Number
                of Shares Outstanding as ofApril
                16, 2007Common
                Stock, $.01 par value
            
            33,511,858


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





Indicate
      by check mark if disclosure of delinquent filers pursuant to Item 405 of
      Regulation S-K is not contained herein, and will not be contained, to the best
      of the registrant's knowledge, in definitive proxy or information statements
      incorporated by reference in Part III of this Form 10-K or any amendment to
      this
      Form 10-K. x





Indicate
      by check mark whether the registrant is an accelerated filer (as defined in
      Exchange Act Rule 12B-2) Yes o
      No x





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





Issuer’s
      revenues for its most recent fiscal year: $ 30,456,897




The
      aggregate market value of the voting and non-voting common equity held by
      non-affiliates of the Registrant, based on the closing price for such common
      equity on April
      16,
      2007 is
      approximately $33,846,976.The number of shares outstanding of the Issuer’s
      common stock, as of April
      16,
      2007 :
      33,511,858 shares.









Item
                  1.
              
              Business
              1Item
                  2.
              
              Description
                  of Properties
              17Item
                  3.
              
              Legal
                  Proceedings
              17Item
                  4.
              
              Submission
                  of Matters to a Vote of Security Holders
              17Item
                  5.
              
              Market
                  for the Registrant’s Common Equity, Related Stockholder Matters and Issuer
                  Purchases of Equity Securities
              17Item
                  6.
              
              Management’s
                  Discussion and Analysis or Plan of Operation
              18Item
                  7.
              
              Financial
                  Statements
              F-1
                  - F-31Item
                  8.
              
              Changes
                  in and disagreements with accountants on accounting and financial
                  disclosure
              27Item
                  8a.
              
              Controls
                  and Procedures
              27Item
                  8b.
              
              Other
                  Information
              27Item
                  9.
              
              Directors,
                  Executive Officers, Promoters and Control Persons of the Registrant
              27Item
                  10.
              
              Executive
                  Compensation
              29Item
                  11.
              
              Security
                  Ownership of Certain Beneficial Owners and Management and Related
                  Stockholder Matters
              30Item
                  12.
              
              Certain
                  Relationships and Related Transactions
              33Item
                  13.
              
              Exhibits
              34Item
                14.
              
              Principal
                Accountant
                Fees and Services
              35









**Forward-Looking
      Statements**




*Certain
      statements within this Form 10-KSB constitute “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act of 1995.
      Such
      forward-looking statements involve known and unknown risks, uncertainties and
      other factors that may cause the actual results, performance or achievements
      of
      Creative Vistas, Inc. to be materially different from any future results,
      performance or achievements expressed or implied by such forward-looking
      statements. These forward-looking statements are based on our current
      expectations and are subject to a number of risks, uncertainties and assumptions
      relating to our operations, financial condition and results of operations,
      including, among others, rapid technological and other changes in the market
      we
      serve, our numerous competitors and the few barriers to entry for potential
      competitors, the seasonality and quarterly variations we experience in our
      revenue, our uncertain revenue growth, our ability to attract and retain
      qualified personnel, our ability to expand our infrastructure and manage our
      growth, and our ability to identify, finance and integrate acquisitions, among
      others. If any of these risks or uncertainties materializes, or if any of the
      underlying assumptions prove incorrect, actual results may differ significantly
      from results expressed or implied in any forward-looking statements made by
      us.
      These and other risks are detailed in this Annual Report on Form 10-KSB and
      in
      other documents filed by us with the Securities and Exchange Commission.
      Creative Vistas, Inc. undertakes no obligation to update publicly any
      forward-looking statements for any reason, even if new information becomes
      available or other events occur in the future.*




**Item
                1.**
            **Description
                of Business**




**Corporate
      Background and Overview**




We
      are a
      leading provider of advanced security and surveillance products and solutions.
      We also provide the deployment and servicing of broadband technologies to the
      commercial and residential market. We primarily operate through our
      subsidiaries, AC Technical Systems Ltd. (“AC Technical Systems”) and Iview
      Digital Video Solutions Inc. (“Iview DVSI”), to provide integrated electronic
      security and surveillance systems and technologies. AC Technical Systems is
      responsible for all of the revenues in the security sector for 2006. It provides
      its systems to various high profile clients including: government, school
      boards, retail outlets, banks, and hospitals. Iview DVSI is responsible for
      providing video surveillance products and technologies to the market.




**Significant
      Development**




On
      December 31, 2005, we acquired Cancable Inc. (“Cancable”) through our wholly
      owned Delaware subsidiary, Cancable Holding Corp. Cancable is in the business
      of
      providing the deployment and servicing of broadband technologies in both
      residential and commercial markets. Cancable has offices in Ontario, Canada.
      All
      related documents were disclosed in Form 8-K/A filed on January 6, 2006. Since
      the transaction was considered completed on January 1, 2006 as the funding
      was
      received after December 31, 2005, we did not consolidate the financial
      statements of Cancable for the year ended December 31, 2005.




Today,
      our operations are divided into two distinct operating segments: (a) security
      and Surveillance Products and Services, and (b) broadband deployment and
      provisioning services. Through AC Technical Systems we provide integrated
      security solutions to our commercial customer base. Through Cancable we provide
      broadband deployment and provisioning services to residential and small
      businesses markets.




The
      current corporate structure is as follows:









1




**Security
      and Surveillance Products and Services**




AC
      Technical Systems is focused on the electronic security segment of the security
      industry. Through our technology integration team of engineers, we integrate
      various security related products to provide single source solutions to our
      growing customer base. Our design, engineering and integration facilities are
      located in Ontario, Canada. We operate through our Iview DVSI subsidiary to
      build out Digital Video Management Systems (DVMS) to provide PC based video
      management systems to the surveillance market. Iview is a product company and
      sells to distributors and integrators in North America. Iview is in early stages
      of building a strong consistent sales and marketing team to start contributing
      revenues to us.




**Ind** **u** **stry
      Overview**




We
      believe that the security industry is growing at a steady pace. There has been
      renewed focus on our industry since the events of September 11, 2001. The growth
      is spurred by the continuous evolution of new technologies and processes. We
      believe that the industry is growing for the following reasons:




·
            Increased
                global awareness due to the increased threats of terrorism;




·
            Older
                security devices such as the VCR have become obsolete and new technologies
                have provided much more efficient systems at a better price;




·
            Evolving
                digital technologies have started to replace antiquated analog
                technologies in the market space;




·
            Expansion
                of budgets due to increased awareness of the need for
                security;




·
            Increase
                in crime rates and shrinkage in the
                industry;




·
            Integration
                of multiple devices has expanded the market for technically advanced
                integrators such as our firm; and




·
            Growing
                public concern about crime.




The
      security industry is highly fragmented with a large number of manufacturers,
      dealers, distributors, integrators and service groups. All of these parties
      provide part of the entire solution to the customer. Customers prefer a one-stop
      shop that provides them with the entire solution and also designs and customizes
      a solution that fits their needs. This solution may include custom design of
      hardware, software, along with highly sophisticated integration work. In most
      cases the cost to the customer is higher when using a large number of parties
      as
      opposed to one efficient integrator. We believe that when many parties are
      involved in providing a solution to the customer, many needs of the customer
      may
      not be addressed. The amount of time a customer has to devote to build multiple
      relationships as opposed one relationship is substantial. There are also
      tendencies for different parties to “pass the blame” to the other party when it
      comes to technical and service issues with the project. As a result, the
      customer prefers dealing with one source that can handle all issues and be
      accountable for an entire project. There are a limited number of companies
      besides us that are capable of providing this entire integrated solution.
      Providing such a solution requires years of experience, infrastructure for
      performing all six core functions that we provide, access to technologies and
      a
      significant commitment to maintaining a satisfied customer.




A
      company
      that is implementing a new security system or enhancing an old system usually
      has to go through the following steps:




·
            Retain
                a consultant to appropriately outline its needs and design a system
                that
                satisfies those needs;




·
            Once
                the design is complete, a tender is released whereby a number of
                invited
                system integrators bid on the required system;




·
            System
                integrators work with various suppliers of hardware and software
                to meet
                the system requirements. They also engage these suppliers to complete
                subcomponents of the system;




·
            When
                security systems have to be installed in multiple locations, the
                company
                may have to tender the system requirements to different system integrators
                from various regions; and




·
            The
                customer, based on price and qualifications of the system integrator,
                will
                award the project to one or more system
                integrators.




The
      process described above can cause a number of issues for clients including
      client frustrations with project delays, cost inefficiencies, incompatible
      systems and lack of vendor accountability. It also makes it very difficult
      for
      the customer to make changes to the system. In addition, a customer looking
      to
      implement security systems in multiple locations may have to hire multiple
      integrators and suppliers to integrate systems. This usually results in systems
      that are not consistent with each other. These systems may also not communicate
      efficiently with a central system. In addition, as security systems become
      more
      technologically advanced, an experienced engineering team is required to
      understand the needs of the customer and satisfy those needs by incorporating
      the most efficient technologies available into the security system. This may
      also include some development of hardware and software to customize and
      integrate the system. Most system integrators are not capable of development,
      as
      they do not have a research and development department. Also, the manufacturers
      of different subsystems are usually not willing to provide custom solutions
      on a
      project basis. Customers are realizing the sophistication required in order
      to
      provide a good security system and recognizing that their in-house personnel
      lack the skills and time necessary to coordinate their security
      projects.




2




**Our
      Strategy**




We
      have
      identified four key markets to target with our solution described below. These
      are 1) government, 2) education 3) healthcare and 4) retail. We offer a
      one-stop-shop that provides a fully integrated technology based security system
      to meet the needs of the customer. We understand the needs of the customer
      and
      provide a custom solution to meet their needs. We expedite project completion,
      reduce costs to the customer, reduce manpower requirements of the customer
      and
      improve systems consistency in multiple locations.




We
      provide the following services:




·
            Consulting,
                audit, review and planning;




·
            Engineering
                and design;




·
            Customization,
                software development and interfacing;




·
            System
                integration, installation and project
                management;




·
            System
                training, technical support and maintenance;
                and




·
            Ongoing
                maintenance, preventative maintenance and service and
                upgrades.




We
      believe that the following key attributes provide us with a sustainable
      competitive advantage including:




·
            Experience
                and expertise in the security industry;




·
            In-house
                research and development departments;




·
            Dedicated
                service team;




·
            Access
                to and experience in a variety of product mix;




·
            Customized
                software and hardware products;




·
            Strong
                references; and




·
            Strong
                partnerships with suppliers and
                integrators.




Our
      strategy for growth and expansion is to:




·
            Expand
                our network of technology partners;




·
            Develop
                and maintain long-term relationships with clients;




·
            Open
                regional offices in key areas to expand revenue and
                service;




·
            Capitalize
                on our position as a leading provider of technologically advanced
                security
                systems; and




·
            Expand
                our marketing and sales program within our key vertical
                markets.




At
      the
      beginning of each new client relationship, we designate an account manager
      as
      the client service contact. This individual is the point person for
      communications between the client and us. The account manager usually has a
      number of years of experience in the industry and a good understanding of
      technologies and solutions that we provide. This person is also a trained
      salesperson who is able to build a long-term relationship with the customer.
      The
      account manager works with our project department, engineering department,
      marketing department, finance department and research and development department
      to provide an effective solution for the customer. Once the customer has engaged
      us to provide a solution, the engagement usually goes through one or more of
      the
      stages outlined below:




*Consulting,
      audit, review and planning*




We
      identify the client’s objectives and security system requirements. We then audit
      and review the client’s existing system. This audit of the existing system
      evaluates inventory counts and the existing infrastructure. Then we provide
      an
      audit report to outline current deficiencies and vulnerabilities. At this point
      we design a system alternative to meet the needs of the customer. The
      alternative system is prioritized based on the needs of the customer. We also
      include an efficient cost model to ensure that the customer understands the
      cost
      of the system. We provide a Return On Investment (ROI) model where applicable.
      We also provide a preliminary project implementation plan that contains a
      graphical model of the client’s premises with exact outlines of equipment
      locations. Our comprehensive planning process helps the customer to properly
      budget for its needs on a long-term basis.




3




*Engineering
      and design*




The
      engineering and design process involve preparation of detailed project
      specifications and working drawings by a team of our design engineers. These
      drawings lay out the entire property and provide a detailed map of all security
      equipment and the methodologies used to integrate the system. The specification
      and drawings also outline any needs for custom software or hardware design
      services, systems designers and computer-aided design system operators. These
      specifications and drawings detail areas of high sensitivity, the layout of
      the
      main control room, and the placement of cameras, card readers, monitors,
      switches and other equipment.




Once
      our
      system design has been completed, we provide a complete list of components
      and
      recommendations. We highly recommend off-the-shelf non-proprietary components
      in
      order to ensure that the customer is not tied into one supplier. When
      off-the-shelf components are not available or are not compatible with each
      other, we design software or hardware to provide compatibility.




*Customization,
      software development, interface*




In
      many
      cases, the customer’s needs may not be completely satisfied by the equipment
      available in the market place. The customer may request features or equipment
      that are not readily available. For example, a financial institution may request
      us to take information from their transaction records and an Automatic Teller
      Machine (ATM), and then integrate that information with a Digital Video Recorder
      (DVR). This would allow them to review video of an individual who has processed
      a transaction on an ATM. Normally a financial institution requires this
      information would have to go through tapes of data in order find it. Such a
      bank
      would have to search all the transactions that occurred during a period of
      time
      and then, based on that information, go over tapes of video. Sometimes the
      video
      may not be available if the tapes are only held for a short period of time.
      Our
      firm’s integrated system makes this search process instantaneous. Our system
      allows a bank to search by a number of criteria including time, date,
      transaction, number and withdrawal amount. A bank can also have video associated
      with such a search instantly.




Many
      times we provide an interface to bring multiple technologies together. In one
      project we integrated eleven different products into one system, thus allowing
      for a completely integrated system. This integrated system also has a very
      user-friendly interface that avoids having to deal with multiple monitors and
      Graphical User Interfaces (GUI).




*System
      integration, installation, project management:*




Once
      we
      determine that a project has passed through the consulting/audit,
      design/engineering and customization/software interfacing stage (if required)
      we
      can start the implementation of system. During this stage, we provide the
      following:




·
            Detailed
                schedule of integration




·
            List
                of components and labor assignments




·
            Officially
                assign the project to one of our project managers




·
            Production
                department starts procurement schedules




·
            Construction
                draw date schedules




·
            Progress
                billings and schedule site visits for quality control




·
            Tests
                of final terminations and technology components in-house in order
                to avoid
                product failure on site




·
            Hardware/software
                and network integration




·
            Validation
                and testing




·
            Final
                sign off and pass over to service
                department




During
      this stage the project manager manages the project and the projects are updated
      weekly to ensure that all components are working efficiently. During certain
      projects the project manager may opt to use subcontractors to provide services
      that are not highly advanced technically. These services may include standard
      wiring and cabling. The customer is updated on the status of the project weekly.
      These updates may include Gantt charts. During this stage, many customers see
      the need for additional enhanced equipment, which increases the value of the
      contract to us.




4




*System
      training, technical support, maintenance*




When
      a
      project has been completed through system integration, the customer is provided
      with a complete training program. We train the customer on how to use the system
      and also provide them with manuals from manufacturers as well as training guides
      put together by us. Once the training is complete the system will go on line
      and
      there is a transfer process to the service department from the projects
      department. Ongoing technical support and maintenance are provided by our
      dedicated service team.




*Ongoing
      maintenance, preventative maintenance and service, upgrades:*




This
      is
      the final stage of our process and it is an ongoing stage. We provide various
      types of maintenance contracts, which vary depending on the level of response
      required by the customer. We also provide a service plan suitable to the
      customer. If the customer does not require a service contract, we provide them
      with service on an incident by incident basis.




The
      entire six steps process continues for each customer. Once a project is
      complete, there are upgrades that are required. Depending on the value of the
      upgrades, they may initiate a new project. During every stage an account manager
      is updated on the process. Account managers have regular meetings with the
      customers after projects are complete in order to help set budgets for the
      following years and also educate customers on new products and technologies
      that
      may be available in the market.




**Research
      and Development**




We
      have
      our own in-house research and development programs which are supported by the
      National Research Council of Canada. We may receive grants and tax credits
      for
      projects and product development if they qualify for the program. Our product
      development department develops new products and also enhances existing
      products. We have the capability to build various forms of hardware and software
      modules. Once a product is designed, the underlying technologies are used on
      an
      ongoing basis to enhance future projects and develop new products. This is
      one
      of the differentiating factors between our competitors and us. Our research
      and
      development expenses were approximately $400,600 in fiscal year 2006 and
      $302,000 in fiscal year 2005. Expenses include engineering salaries, costs
      of
      development tools and equipment. None of the expenses were borne directly by
      customers.




**Warranties
      and Maintenance**




We
      offer
      maintenance and service on all our products, including parts and labor, which
      range from one year to six years depending upon the type of product concerned
      and the type of contract signed by the customers. In addition, we provide a
      one-year warranty on equipment and a 90 day warrant all installation projects
      completed by us. We receive the same warranty on equipment from our external
      other suppliers.




On
      non-warranty items, we perform repair services for our products sold at our
      main
      office in Ontario, Canada or at customer locations. For the years ended December
      31, 2006 and December 31, 2005, our revenue from service and maintenance were
      $1,284,000 and $1,296,000 respectively.




**Marketing**




Our
      marketing activities are conducted on both national and regional levels. We
      obtain engagements through direct negotiation with clients, competitive bid
      processes, referrals and direct sales calls. Our marketing plan is derived
      with
      the input from all our account managers and senior management. Our plan is
      to
      grow vertically within targeted markets where we have a superior level of
      expertise. Our marketing is very target specific. We market within our four
      key
      markets. We also find niche markets where our technologies can provide effective
      solutions to the customer. Some our marketing activities include:




·
            Trade
                Shows




·
            Mailers




·
            Direct
                sales calls




·
            Web
                promotions




·
            Seminars




·
            Collaborations
                with manufacturers




·
            Collaborations
                with consultants and architects




We
      also
      collaborate with providers of complementary technologies and products who are
      not competitive with us. For example, there is a convergence of IT services
      and
      the security industry. We are evaluating the possibility of partnering with
      an
      IT services provider in order to provide our existing and potential customers
      with an expanded scope of services. We are also doing the same within the
      building automation industry as we see a convergence of building automation
      technologies and services with the security industry.




5


We
      are
      evaluating several opportunities to expand our operations via joint ventures
      and
      partnerships with regional and international companies that can provide us
      with
      additional expertise and an expanded presence. In addition we are evaluating
      the
      possibility of acquiring similar businesses and expanding our
      operations.




**Customers**




We
      provide our products and services to customers in five markets :




·
            Government




·
            Healthcare




·
            Education




·
            Retail




·
            Commercial
                Property Management




We
      also
      provide our products and services to various other sectors including corporate
      facilities, mining, entertainment and the automobile industry through direct
      sales to end-users and through subcontracting agreements.




The
      table
      below sets forth the approximate percentage of aggregate revenues for the year
      ended December 31, 2006 and 2005 from each of our largest customers/end-users:




**Year
                Ended**
              **December
                31, 2006**
            
            **Year
                Ended**
              **December 31,
                2005**Ontario
                Electrical Construction Ltd.
            
            
            6.6
            %
            
            1.0
            %Ontario
                Realty Corporation
            
            
            5.7
            %
            
            2.7
            %SNC
                Lavalin Profac
            
            
            6.6
            %
            
            4.3
            %Ministry
                of Finance
            
            
            5.1
            %
            
            1.5
            %World
                Wide Electric
            
            
            3.5
            %
            
            3.0
            %bclMC
                Realty Corporation
            
            
            3.7
            %
            
            0.3
            %Phazer
                Electric
            
            
            3.3
            %
            
            5.1
            %Highpoint
                commercial Management Service
            
            
            2.6
            %
            
            0.9
            %Brother’s
                & Wright Electrical Services Inc
            
            
            2.2
            %
            
            0.1
            %Lakerage
                Health Corp.
            
            
            2.7
            %
            
            1.2
            %




As
      reflected in the above table, from period to period we derive revenues at
      different times from different customers.




**Backlog**




Our
      backlog consists of written purchase orders and contract, we have received
      for
      product deliveries and engineering services that we expect to deliver or
      complete within 12 months. All of these orders and contracts are subject to
      cancellation at any time. As of December 31, 2006, our backlog was
      approximately $2,800,000.




**Competition**




The
      security industry is highly fragmented and competitive. We compete with a number
      of different companies regionally and nationally. We have various different
      types of competitors including consultants, integrators, and engineering and
      design firms. Our main competitors include Siemens, ADT, Simplex, Intercon
      and
      Diebold. Our competitors also include equipment manufacturers and vendors that
      provide security services. Some of our competitors have greater name recognition
      and financial resources than we do. However, we believe that we have a
      well-respected name and are known for our quality work and technical expertise.
      We may face future competition from potential new entrants into the security
      industry and increased competition from existing competitors that may attempt
      to
      develop the ability to offer the full range of services offered by us. We cannot
      assure that we will be able to compete successfully in the future against
      existing or potential competitors.




6


**Employees**




As
      of
      December 31, 2006, Cancable
      has a staff of over 350
      employees andA.C. Technical Systems has a staff of 51 full time employees
      including our officers, of whom 38 were engaged in systems installation and
      repair services, 9 in administration and financial control and 5 in marketing
      and sales.




None
      of
      our employees are covered by a collective bargaining agreement or represented
      by
      a labor union. We consider our relationship with our employees to be
      satisfactory.




The
      design and implementation of our equipment and the installation of our systems
      require substantial technical capabilities in many different disciplines from
      computer science to electronics with advanced hardware and software development.
      As a company, we encourage and provide training for new and existing technical
      personnel. In addition we conduct training courses and also send our technical
      persons to various technical courses offered by manufacturers of various
      products. We have various incentive programs for our employees to improve their
      skills within all departments. These include reimbursements for training fees
      and raises based on skill sets.




**Broadband
      deployment and provisioning services**




We
      operate through our subsidiary Cancable Inc., located in Ontario, Canada to
      provide and deploy broadband services. Cancable Inc. was a subsequent
      acquisition.





Cancable
      Inc. is
      a
      growing Canadian based leader in providing and servicing broadband technologies
      to both residential and commercial markets. The Cancable service offering,
      network deployment, IT integration, and support services enable the cable
      television and telecommunications industries to deliver a high quality broadband
      experience to their customers. Cancable’s clients rely on Cancable’s knowledge
      and expertise to rapidly deploy the latest technologies to support advanced
      cable services, cable broadband Internet access and DSL. Services provisioned
      include new installations, reconnections, disconnections, service upgrades
      and
      downgrades, inbound
      technical call center sales and trouble resolution for cable Internet
      subscribers ,
      and
      network servicing for broadband video, data, and voice services for residential,
      business, and commercial marketplaces.




Cancable
      has a long history as a field services organization. It has been successful
      in
      developing long-term relationships with its clients and is highly regarded in
      the
      industry for quality. This is evidenced by its status as the largest service
      provider to Rogers Cable Inc., Canada’s largest cable company and the exclusive
      supplier to Cogeco Cable Inc. in the Windsor, Ontario area. Cancable’s central
      appeal to its customers is its ability to deliver its quality services and
      at a
      cost which they cannot match internally.




**Senior
      Management**




Cancable
      has a proven team with over 70 years of cable TV contracting/technical
      deployment and support experience.




**Ross
      Jepson, President and CEO,** has
      successfully completed a number of senior executive assignments in the cable
      and
      telecommunications sector since 1985. He was appointed President and CEO in
      January 2003 after serving one year as the EVP, Operations. In addition to
      having led the purchase and sale of numerous companies during his executive
      career, he is also deeply experienced in sales, marketing, operations and new
      business development.




**Mark
      Thompson, MBA (Finance & Human Resources)**  **VP,
      Fin & Admin,** joined
      Cancable in November 2004, bringing over 10 years of Finance and Consulting
      experience in entrepreneurial, high growth and turnaround situations. He has
      held senior roles in the high-tech, distribution and financial services
      industries. Mr. Thompson is responsible for all finance, accounting, is-it,
      and
      human resources functions for Cancable.




7


**Paul
      Mease, P. Eng., MBA, VP, Operations,** joined
      Cancable in August 2005, bringing nine years of executive and general management
      experience in operations and field service management in the utilities and
      cable
      sectors.




**Cheryl
      Lewis, Director, DependableIT** ***,*** began
      her career at Cancable in 1998 managing the dispatch group and building the
      original team of technicians. Ms. Lewis later assumed responsibility for the
      DependableIT division, a call center managing all incoming tech support calls
      and sales leads, as well as on-site technicians resolving computer support
      issues.




**Our
      Strategy**




Cancable
      b elieves
      that there is a large and growing market for its services and the demand for
      its
      services is growing as:




·
            The
                increase in popularity of the Internet and in the complexity of Internet
                sites has increased demand for high-speed Internet access from both
                residential and commercial consumers;




·
            Technological
                advances, including the shift from an analog to a digital network
                environment and the ability to leverage existing network infrastructure
                to
                deploy high-speed services such as IP networking technologies, have
                accelerated the availability of advanced services such as digital
                video
                and high-speed Internet access;




·
            Cable
                and telecommunications service providers have made significant investments
                to build and upgrade their wired and wireless networks, creating
                a
                substantial opportunity to deliver advanced services to commercial
                and
                residential consumers;




·
            End-users
                increasingly demand access to integrated video, voice and data services,
                advanced set top boxes, high-speed digital modems, telephone lines,
                voice
                mail, computer networks, video conferencing and other technologies.
                Cancable’s clients must rapidly deploy these technologies in order to
                maximize their revenue per end-user, realize a return on their investments
                and maintain or gain competitive advantages; and




·
            The
                availability of multiple choices for end-users to receive advanced
                services has led broadband service providers to focus increasingly
                on
                end-user satisfaction to control turnover and to rely on technology
                enabling companies for some of their non-core activities, such as
                installation, integration, fulfillment, maintenance, warranty and
                support
                services.




**Key
      Client Relationships**




Cancable
      has two main customer relationships, Rogers Cable Inc. and Cogeco Cable. Rogers
      Cable Inc. is the most significant.




**Rogers
      Cable Inc.**




Rogers
      Cable Inc. is
      Cancable’s largest customer employing approximately 185 of our field technicians
      (Mississauga Primary contractor with 85, Scarborough Primary with 60, Toronto
      Secondary with 40) as of July 2005. In addition to its in-house capability,
      Rogers currently utilizes eight contractors to manage its cable TV activity.
      This number is down from 22 contractors three years ago. Over the past two
      years, as a result of the vendor consolidation and its top rated performance,
      Cancable has emerged as Rogers’ primary contractor in the Greater Toronto Area
      with a 33% share of completed work orders




In
      addition to installation and service work, Cancable has finalized a new three
      year agreement that extends the types of services it will be performing. As
      evidence of Rogers growing dependency on Cancable, Rogers has requested that Cancable
      supplement its Tier 2 and Tier 3 customer service programs, something that
      is
      presently handled only by Rogers personnel. In this service, a call is
      transferred from Rogers’ customer service department to DependableIT, Cancable’s
      branded technical support centre, after Rogers determines that it is not
      directly a Rogers cable related problem. DependableIT’s remote diagnostic tools
      provide it with a complete situational review of the customer’s site. In these
      instances, the charge is billed to the customer’s credit card before assistance
      is provided. With the Tier 3 service, a field service visit is required and
      a
      Cancable technician is dispatched to the customer’s location with rates charged
      on an hourly basis for residential and commercial customers. Again, this service
      is presently provided by Rogers personnel only.




8




**Cogeco
      Cable Inc.**




Cancable’s
      current field supporting work with Cogeco is limited to the Windsor, Ontario
      area. In November 2003, Cancable assumed exclusive responsibility for all
      Cogeco-related installation activity. Cancable is currently in discussions
      on a
      new two year contract. Under this contract, Cancable’s 20 technicians will be
      co-located in Cogeco’s facility and the current residential install business
      will be expanded to include commercial work including all Cogeco commercial
      Internet sales and technical calls. DependableIT will charge a per call fee
      for
      support, and most significantly, earn commission on services sold. In addition
      the service offering is expanding into Tier 2 service - residential, similar
      to
      that currently being provided to Rogers.




Cancable’s
      competition within its geographical segment is contained to a minimal number
      of
      firms. They include Wirecomm, Trinity Cable and J&P Cable among others. We
      believe that our contracted revenue is significantly higher than any of the
      other competitors in our geography and thus gain an advantage due to our size
      and internally efficient systems.




**The
      Contract Field Technical Support Industry**




**Overview**




In
      2004,
      the cable television industry in Canada served 9.3 million homes of which 2.3
      million were subscribers to digital cable. While direct to home satellite
      service providers have penetrated the video market, cable operators continue
      to
      maintain an overall 77% market share.




A
      significant development for both cable and telecom companies has been the
      acceptance of the internet as a mass medium for commerce and communications
      involving both residential and commercial consumers. A recent reported stated
      that, as of 2004, 44% of Canadian homes were connected to high-speed Internet
      services. Approximately 2.3 million homes connect via cable while 1.9 million
      connect via telco providers.




At
      present, Cancable’s management believes that there are approximately 25
      providers of contract field technical support serving the Ontario cable
      television market. Management also believes that this number will be markedly
      reduced in the near future as evidenced by the vendor consolidation initiative
      recently completed by Rogers. Management believes that its cable television
      clients who operate in multiple geographic markets will prefer to align
      themselves with larger technology enablers, like Cancable, who are able to
      deploy consistent service on a wider scale and have the expertise and resources
      to deploy and maintain increasingly complex technologies.




Accordingly,
      management believes that its target market presents substantial growth
      opportunities due to:




·
            the
                increasingly competitive landscape in the areas of video, internet
                and
                telecom delivery, which are requiring cable operators to increase
                their
                commitment to quality customer service and strict quality
                standards;




·
            a
                drive for cost reductions on the part of the cable operators, caused
                by
                price competition due to “bundling” strategies by them and their
                competitors;




·
            the
                increasing demand by residential and commercial consumers for advanced
                broadband services such as high-speed internet access, digital video
                and
                telephone;




·
            the
                need to satisfy the demand for emerging broadband communications
                technologies such as web-based video
                conferencing;




·
            virtual
                private networks, which are networks run over the internet that provide
                privacy to the network users;




·
            voice-over-IP
                (VOIP), which will allow simultaneous two-way voice communication
                with
                high-speed data transmission over broadband;
                and




·
            the
                availability of multiple choices for consumers to receive these advanced
                services, which has led to intensifying competition for subscribers
                and an
                increased focus among BSPs on consumer satisfaction, and the need
                for BSPs
                to rapidly deploy technology and equipment capable of delivering
                advanced
                services to residential and commercial consumers to realize a return
                on
                the significant investments they have made to build and upgrade their
                networks.




9


Over
      the
      next three years Cancable’s management expects to see its industry change
      significantly for the following reasons:




**Increasing
      Technological Complexity**




Each
      of
      Cancable’s target market segments is experiencing rapid changes in technology.
      The convergence of previously separate technologies has produced newer, more
      complex technologies, such as bundled video, voice and data services. Delivering
      these services requires more highly trained technicians, cross-trained in
      several technologies, to provide installation, integration, fulfillment, and
      long-term maintenance and support services than in the past. For
      example:




·
            *Cable
                Internet access.*High-speed
                internet access requires that cable system operators provide initial
                installation and testing as well as on-going maintenance and support
                of
                new technologies, such as cable modems and network cards.




·
            *VOIP*.
                Cable
                operators are already in the process of utilizing their networks
                for the
                provision of local telephone. This area represents a potentially
                significant source of incremental activity for
                Cancable.




·
            *Convergence
                of video and telecom services****.***Increasingly,
                traditional telecom carriers are entering the field of entertainment
                and
                data delivery, either through strategic investments in alternate
                technologies (see Direct Broadcast Satellite below) or through the
                adaptation of the existing telecom
                infrastructure.




·
            *Direct
                to home Satellite.*Programming
                services require installation of a satellite receiving antenna or
                dish and
                a digital receiver at the consumer premises. In order to facilitate
                high-speed internet access, additional coordination is required between
                the satellite technologies and the standard telephone line modem
                connections that handle outbound communications from the consumer.
                Although certain DTH equipment may be installed by the consumer,
                there is
                a growing trend toward professional installation of satellite
                equipment.




·
            *Premise
                networking.*Premise
                networking requires installation, certification and maintenance of
                high-speed data networks, including LANs/WANs, client/server networks,
                and
                video, audio and security networks meeting stringent industry
                requirements. Substantial resources must be committed to train and
                retain
                field technicians in the new technologies. Cancable believes that
                these
                increasing knowledge and training requirements present a significant
                competitive advantage for larger, well-capitalized enabling companies,
                and
                provide additional motivation for BSPs to rely on independent technology
                enablers thereby avoiding costly investments in internal service
                and
                fulfillment infrastructures.




**Increased
      Reliance by BSPs on** **outsourcing**




Technological
      advances and deregulation in the cable, telecommunications, satellite wireless
      and premise networking industries have provided residential and commercial
      consumers with multiple choices for receiving advanced services. The escalating
      competition for end-users has increased competitive pressures on BSPs, which
      is
      requiring them to focus more on consumer satisfaction. The providers' need
      to
      rapidly upgrade and expand existing systems, as a result of increased
      competition and growing demand for advanced services, should lead to a continued
      increase in the level of reliance on independent technology enablers for
      non-core activities, such as installation, integration, fulfillment, and
      long-term maintenance, warranty and support services. Management anticipates
      that BSPs will increase their reliance on independent technology enablers like
      Cancable to the extent that the enablers provide services that are of a higher
      quality and more cost efficient than existing, in-house infrastructure, in
      the
      same way that providers historically have relied on outside sources for other
      ancillary functions, such as design and manufacture of consumer premise
      equipment. Many emerging BSPs, such as DSL and DTH providers, often enter new
      markets where they have little or no local presence and limited resources to
      meet the growing demand for their advanced video, voice and data services.
      These
      providers typically have no in-house service infrastructure. Cancable believes
      these BSPs will continue to rely on independent technology enablers to meet
      their installation and maintenance needs. Cancable believes there will be an
      increased need for higher value-added services as the broadband industry
      continues to evolve and recurring upgrades and value-added improvements become
      more significant. Historically, large corporations with internal information
      technology departments have been primary users for such applications. However,
      the rapidly growing demand for such applications from small to medium-sized
      businesses and residential end-users, which do not have internal deployment
      and
      maintenance capabilities, presents additional growth opportunities for
      independent technology enablers like Cancable.




10




**Emergence
      of Preferred Providers of Technology Enabling Services** ****




Cancable
      believes that because of the increasing geographic scope of and complexity
      of
      technology deployed by BSPs, there is a growing trend towards a long-term,
      strategic alliances with technology enabling companies, in contrast to the
      historic, contractual project-by-project arrangements. Cancable believes that
      its industry is highly fragmented and characterized by smaller, privately held
      companies that offer a limited range of industry-specific services to a small
      number of clients in concentrated geographic areas. In Cancable’s experience,
      BSPs in its target markets who rely on technology enabling companies prefer
      to
      align themselves with larger, better capitalized companies that:




·
            have
                the expertise and resources to deploy and maintain increasingly complex
                technologies over large networks;




·
            consistently
                deliver high quality service;




·
            provide
                regional coverage and have the capacity to work on multiple projects
                simultaneously; and




·
            have
                the ability and willingness to invest in infrastructure to enhance
                the
                deployment and maintenance of the advanced technologies demanded
                by
                residential and commercial customers.




**Industry
      Trends Specific to the Contract Field Technical Support
      Industry**




·
            *Competition
                at the client level.***Some
                of Cancable’s customers are in a monopolistic industrial environment.
                Today, these customers are faced with increasing competition in which
                is
                forcing them to adapt the new reality. Part of this adaptation includes
                taking an in-depth review of their internal cost structure to determine
                which services must be performed by employees and which should be
                contracted out, at lower cost.




·
            *Consolidation
                at the client level.***The
                cable television industry in particular has been undergoing a trend
                towards consolidation for many years. This trend has resulted in
                changes
                in the manner in which services are contracted for and has changed
                the
                relationship between client and service provider. Relationships today
                are
                driven less determined by personal contacts and more by professional
                qualifications. Also important to industry relationships today are
                the
                service provider’s ability to provide a service level that is uniform
                across its work force and to integrate its management and reporting
                systems with those of the client.




·
            *Trend
                towards contracting out.*The
                above two drivers are causing cable television and telecommunications
                service providers to move increasingly towards contracting out services
                that are perceived to be non-core but are manageable through sophisticated
                systems and a high level of integration between their own internal
                systems
                and those of the support provider. While not a current client of
                Cancable,
                Bell Canada is leading the trend in this area with almost all of
                its field
                service activities contracted out. Cancable believes that its two
                largest
                clients, Rogers Cable and Cogeco Cable, contract out approximately
                two-thirds of their field installation and service call work. Cancable
                expects that this percentage will continue to increase and that the
                outsourcing trend will spread to these clients’ other field activities
                that are currently not outsourced.




·
            *Consolidation
                among service providers.*As
                an adjunct to consolidation at the client level, larger clients want
                to
                increase efficiency by reducing the number of vendors in each area.
                This
                trend tends to favor those service providers that are able to scale
                up to
                the demands of increased volumes and are able to meet the system
                integration requirements of the
                client.




11


**RISK
      FACTORS**




Described
      below are the material risks that we face. Our business, operating results
      or
      financial condition could be materially adversely affected by, and the trading
      price of our common stock could decline due to, any of these risks.




*Competitive
      pressure from larger firms*




The
      security industry is highly competitive. We compete with a number of large
      international firms, which have more extensive resources than we do. In
      addition, these competitors may have greater brand recognition, proprietary
      technologies and superior purchasing power as well as other competitive
      advantages.




*Risks
      associated with budget constraints and cut back of customer
      spending:*




We
      are
      dependent on large institutional and commercial customers and their budgets.
      If
      there are cut backs in budgets by its customers it will adversely impact our
      revenues.




*Risks
      associated with possible delays of construction schedules*




We
      have
      contracted to provide security systems to a number of new buildings. Delays
      in
      construction of these buildings could potentially delay revenues being
      realized.




*Supplier
      product failures*




We
      do not
      currently manufacture our own products and must purchase products from others.
      It could adversely impact our relationships with our customers if there are
      delays in receiving products from suppliers or if there are defects in these
      products.




*Contracts
      with government agencies may not be renewed or funded*




Contracts
      with government agencies accounts for some of our revenues. Many of these
      contracts are subject to annual review and renewal by the agencies and may
      be
      terminated at any time or on short notice. Each government contract is only
      valid if the agency appropriates enough funds for such contracts. Accordingly,
      we might fail to derive any revenue from sales to government agencies under
      a
      contract in any given future period. In addition, if government agencies fail
      to
      renew or terminate any of these contracts, it would adversely affect our
      business and results of operations.




We
      have a
      small number of customers from which we receive a large portion of our sales.
      A
      single customer accounted for more than ten percent of total sales for the
      years
      ended December 31, 2003 and 2004. Our experience has been that some of
      these substantial customers will be a source of significant sales in the
      succeeding year and some will not. Consequently, we are often required to
      replace one customer with one or more other customers in order to generate
      the
      same amount of sales. There can be no assurance that we will continue to be
      able
      to do so.




*Key
      personnel losses*




Competition
      for highly qualified technical personnel is intense and we may not be successful
      in attracting and retaining the necessary personnel, which would limit the
      rate
      at which we can develop products and generate sales. In particular, the
      departure of any of our senior management members or other key personnel could
      harm our business.




*Intellectual
      property protection risks*




Our
      intellectual property might not be protected. No new intellectual property
      has
      been acquired within the last three years. Despite our precautions, it may
      be
      possible for unauthorized third parties to copy our products or obtain and
      use
      information that we regard as proprietary to create products that compete
      against ours. If we fail to protect and preserve our intellectual property,
      we
      may lose an important competitive advantage. In addition, we may from time
      to
      time be served with claims from third parties asserting that our products or
      technologies infringe their intellectual property rights. If, as a result of
      any
      claims, we were precluded from using technologies or intellectual property
      rights, licenses to the disputed third-party technology or intellectual property
      rights might not be available on reasonable commercial terms, or at all. We
      may
      initiate claims or litigation against third parties for infringement of our
      proprietary rights or to establish the validity of our proprietary rights.
      Litigation, either as plaintiff or defendant, could result in significant
      expenses or divert the efforts of our technical and management personnel from
      productive tasks, whether or not the litigation is resolved in our favor. A
      successful claim against us, coupled with our failure to develop or license
      a
      substitute technology, could cause our business, financial condition and results
      of operations to be adversely affected.




12




*We
      may not be able to increase our bonding*




Many
      of
      our government contracts require that we obtain bonding. We may not be able
      to
      increase our bonding and, therefore, we may not be able to pursue larger
      projects as a primary contractor.




*Fluctuation
      in quarterly results*




Our
      quarterly results have varied over the past few years and will likely continue
      to do so. The results will vary based on the timing of the projects,
      construction schedules and customer budgets. Such fluctuations may contribute
      to
      volatility in the market price for our stock.




*Lengthy
      sales cycle*




The
      sale
      of our products and services frequently involves a significant commitment of
      resources to evaluate and propose a project. The approval process for our
      proposals usually involves multiple departments within our clients and may
      take
      several months. Accordingly, depending on the length of recording and processing
      time, a sale can take a prolonged period of time.




*We
      may not be able to successfully make acquisitions or form partnerships as a
      means of fostering our growth*




Our
      growth strategy involves successfully acquiring companies that will add value
      to
      our firm and also build partnerships with companies who can complement our
      core
      competencies. We may not be successful in identifying or consummating
      transactions with such companies.




*Continued
      need for additional financing*




To
      implement our growth plan, we may need additional financing. We will need
      additional financing upon, but not limited to, any of the following
      events:




·
            Changes
                in operating plans




·
            Lower
                than anticipated sales




·
            Increased
                costs of expansion




·
            Increase
                in competition relating to decrease in price




·
            Increased
                operating costs




·
            Potential
                acquisitions




Additional
      financing may not be available on commercially reasonable terms or may not
      be
      available at all.




*Cancable,
      one of our major subsidiaries, relies on certain large clients for a significant
      portion of our revenues*




Cancable
      currently derives a significant portion of its revenues from a limited number
      of
      clients. For the fiscal year ended December 31, 2006, Rogers Cable TV Limited
      accounted for approximately 79% of Cancable’s revenues. The services required by
      any one client can be limited by a number of factors, including industry
      consolidation, technological developments, economic slowdown and internal budget
      constraints. Cancable’s clients are not obligated to purchase additional
      services and most of Cancable’s contracts are cancelable on short notice. As a
      result of these factors, the volume of work performed for specific clients
      is
      likely to vary from period to period and a major client in one period may not
      use Cancable’s services to the same degree in a subsequent period. A temporary
      or permanent loss of any of Cancable’s key clients could seriously harm its
      business. If any cancelled contracts were not replaced with contracts from
      other
      clients, Cancable’s revenues might decrease and its profitability could be
      adversely affected.




13




*Cancable
      will be adversely affected by a decline in the growth of the cable and telecom
      industries*




The
      broadband communications industry has experienced a high rate of growth. If
      the
      rate of growth slows, and broadband service providers reduce their capital
      investments in upgrades or expansion of their systems, Cancable’s clients may
      not require the same volume of services from Cancable and it may not be able
      to
      execute its growth strategy. In that case, Cancable’s profitability and its
      prospects could be adversely affected.




*Our
      clients may not rely on the Contract Field Technical Support services we
      provide*




Cancable’s
      success is dependent on the continued reliance by BSPs on independent companies
      like Cancable for performance of their installation, integration, fulfillment,
      and long- term maintenance and support services. If these providers elect to
      perform these services themselves, Cancable’s revenues may decline and its
      business could be harmed.




*Consolidation
      of broadband service providers could result in fewer and smaller customers
      for
      us*




The
      cable, telecommunications, satellite and wireless industries could experience
      significant consolidation activity. In addition, the consolidation of Cancable’s
      clients could have the effect of reducing the number of its current or potential
      clients, which could result in Cancable’s dependence on a smaller number of
      clients.




*Cancable
      may face reduced customer demand due to new technologies*




Cancable’s
      industry is subject to rapid changes in technology. Existing technologies for
      transmission of video, voice and data are subject to potential displacement
      by
      various new technologies. New technologies may be developed that allow broadband
      service providers to deliver their services to consumers without a significant
      upgrade of their existing systems. Furthermore, new technologies may be
      developed that enable consumers to perform more easily their own installation
      and maintenance of the equipment required for the delivery of these services
      at
      their premises. Cancable will need to be able to enhance its current service
      offerings to keep pace with technological developments and to address
      increasingly sophisticated client needs. Cancable may not be successful in
      developing and marketing service offerings that respond to technological
      advances in a timely manner, and its services may not adequately or
      competitively address the needs of the changing marketplace. If Cancable is
      not
      successful in responding in a timely manner to technological changes, market
      conditions and industry developments, it may lose current clients or be unable
      to obtain new clients and its business, prospects, operating results and
      financial condition could suffer.




*Cancable
      may not be able to compete on price with our competitors*




Cancable’s
      industry is fragmented and highly competitive. Accordingly, it cannot be assured
      of being able to maintain or enhance its competitive position. Historically,
      there have been relatively few barriers to entry into the markets in which
      Cancable operates. As a result, any organization that has adequate financial
      resources and access to technical expertise may become one of our competitors.
      Competition in the industry depends on a number of factors, including price.
      Cancable’s competitors may have lower cost structures and may, therefore, be
      able to provide their services at lower rates than it can. Cancable also faces
      competition from the in-house service organizations of its existing or
      prospective clients, which often employ personnel who perform some of the same
      types of services as it does. If Cancable is unable to maintain or enhance
      its
      competitive position, its business, prospects, operating results and financial
      condition may suffer materially.




*Cancable
      may face an inability to attract and retain qualified employees*




Cancable’s
      ability to provide high-quality services on a timely basis requires that it
      employ an adequate number of field technicians. Accordingly, its ability to
      meet
      the demand for its services will be limited by Cancable’s ability to attract,
      train and retain skilled personnel. Cancable’s industry is characterized by
      highly competitive labor markets and, like many of its competitors, historically
      Cancable has experienced high rates of employee turnover. Furthermore, its
      labor
      expenses may increase as a result of a shortage in the supply of skilled
      personnel and its efforts to improve its employee retention, which could
      adversely impact its profitability. Cancable cannot be certain that it will
      be
      able to improve its employee retention rates or maintain an adequate skilled
      labor force necessary to operate efficiently and to support its growth strategy.
      Failure to do so could impair its ability to operate efficiently and maintain
      its reputation for high quality service. This could also impair Cancable’s
      ability to retain current clients and attract new clients that could cause
      its
      financial performance to decline.




14




*Mismatch
      of Staffing Levels and Contract Requirements*




Since
      Cancable’s business is driven by large, and sometimes multi-year contracts,
      Cancable forecasts its personnel needs for future projected business. If
      Cancable increases its staffing levels in anticipation of a project that is
      subsequently delayed, reduced or terminated, it may underutilize these
      additional personnel, which would increase its expenses and could harm its
      business.




*Cancable
      relies on key senior employees and management*




Cancable’s
      success is substantially dependent upon the retention of, and the continued
      performance by, its senior management and other key employees, including key
      employees of companies that it may acquire in the future. If any member of
      Cancable’s senior management team becomes unable or unwilling to participate in
      its business and operations and it is not able to replace them in a timely
      manner, its business could suffer. Cancable does not maintain "key man" life
      insurance policies on any member of its senior management or any of its key
      employees.




*Cancable
      is a growing business and may require additional financing which may not be
      available to us*




Cancable
      may require additional financing, including access to a bank operating line
      and
      lease financing for vehicles, to fully implement its business strategy in a
      timely manner. Cancable’s future requirements will depend on many factors,
      including continued progress in its client development and expansion programs.
      There can be no assurance that additional funding will be available or, if
      available, that it will be available on acceptable terms. If such funding is
      not
      available, Cancable may be forced to reduce or eliminate expenditures for
      further development of its proposed new initiatives and contemplated
      acquisitions. There can be no assurance that Cancable will be able raise
      additional capital if its capital resources are exhausted. Cancable’s ability to
      arrange such financing in the future will depend in part upon prevailing capital
      market conditions as well as its business performance. Failure to obtain such
      financing could delay implementation of Cancable’s strategy and could have a
      material adverse effect on its ability to successfully develop its business.
      Such financing, if available, could result in dilution to existing
      shareholders.




*We
      have issued a substantial number of warrants and options and other convertible
      securities, which may cause the trading price of our securities to decline
      and
      may limit our ability to raise capital from other sources:*




As
      of
      December 31, 2006, there were 6,713,503 shares of common stock issuable upon
      the
      exercise of warrants and 299,997 shares issuable upon the exercise of options.
      Additionally, there were 49 shares of common stock of Cancable issuable upon
      the
      exercise of options and 20 shares of common stock of Iview issuable upon the
      exercise of options. While these securities are outstanding, the holders will
      have the opportunity to profit from a rise in the price of our securities with
      a
      resulting dilution (upon exercise or conversion) in the value of the interests
      of our other security holders. Our ability to obtain additional financing during
      the period these convertible securities are outstanding may be adversely
      affected and their existence may have a negative effect on the price of our
      securities. We may be obligated to issue additional shares in payment of accrued
      interest on our term notes as a result of adjustments to the conversion or
      exercise prices of our convertible securities. Additional shares of our common
      stock may be issued if additional amounts are funded under our existing
      financing arrangements with Laurus or if we obtain additional financings in
      the
      future. The happening of certain events such as stock splits, reverse stock
      splits, stock dividends or certain additional share issuances at prices below
      the then effective exercise or conversion price would trigger an adjustment
      in
      the exercise or conversion price (as applicable). The adjustment would be based
      upon a weighted average formula in the case of below exercise or conversion
      price issuances. The adjustment will depend on the number of shares issued
      and
      the difference between the issuance price and the then effective exercise or
      conversion price. Since no such transactions are currently contemplated, it
      is
      not presently possible to quantify possible future adjustments. The holders
      of
      these securities are likely to exercise them at a time when we would, in all
      likelihood, be able to obtain any needed capital by a new offering of securities
      on terms more favorable to us than those of the outstanding warrants and
      options.




*Because
      our directors own approximately 86% of our outstanding common shares, they
      could
      make and control corporate decisions that may be disadvantageous to minority
      shareholders*




Our
      directors own approximately 86% of the outstanding common shares. Accordingly,
      they will have a significant influence in determining the outcome of all
      corporate transactions or other matters, including mergers, consolidations
      and
      the sale of all or substantially all of our assets, and also the power to
      prevent or cause a change in control. The interests of our directors may differ
      from the interests of the other shareholders and thus result in corporate
      decisions that are disadvantageous to other shareholders.




15




*Exchange
      rate fluctuations may have adverse effects on our revenues*




A
      portion
      of our revenues and expenses are denominated in Canadian dollars. As a result,
      we will be exposed to currency exchange rate risk. Our reported earnings could
      fluctuate materially as a result of foreign exchange rate fluctuations.




*Our
      substantial debt could adversely affect our financial position*




Our
      substantial indebtedness could have important consequences to you. Our annual
      debt service requirements related to payments of principal on our $16,869,800
      principal amount of term notes are approximately $2,584,900, $2,240,300,
      $237,500, $5,050,000 and $6,757,100 from 2007 to 2011. In addition, since
      February 1, 2006, interest on the notes has been payable on a monthly basis.
      In
      addition, we have a series of other notes payable totaling $1,528,700 as of
      December 31, 2006. The annual principal repayment is approximately $28,700
      for
      2007. The $1,500,000 promissory note included in other notes payable, which
      were
      issued by Creative Vistas Acquisition to The Burns Trust and The Navaratnam
      Trust in connection with the acquisition of AC Technical, have no fixed term
      of
      repayment. The note payable was transferred to Malar Trust during Fiscal Year
      2006 with the same payment term. The term notes are secured by all of our
      assets. Interest on term notes are settled in cash. However, in the event we
      are
      unable to generate sufficient cash flow from our operations, we may face
      difficulties in servicing our substantial debt load. In such event, we could
      be
      forced to seek protection from our creditors, which could cause the liquidation
      of the Company in order to repay the secured debt. In any liquidation of us,
      the
      holders of our debt (including The Malar Trust ) would be required to be paid
      in
      full before any payments could be made to the holders of our common stock.
      In
      addition, our outstanding indebtedness could limit our ability to obtain any
      additional financing.




*There
      is no active trading market in our securities*




Although,
      our common stock is quoted on the NASD OTC Bulletin Board, there is no active
      trading in the stock. A trading market may not develop and stockholders may
      not
      be able to liquidate their investment without considerable delay. If a market
      should develop, the price of our stock may be highly volatile.




*Penny
      Stock regulations apply to our securities:*




Our
      securities are subject to the “penny” stock regulation of Rule 15g-9 of the
      Securities Exchange Act of 1934. Rule 15g-9 of the Exchange Act is commonly
      referred to as the “penny stock” rule and imposes special sales practice
      requirements upon broker-dealers who sell such securities to persons other
      than
      established customers or accredited investors. A penny stock is any equity
      security with a market price less than $5.00 per share, subject to certain
      exceptions. Rule 3a51-1 of the Exchange Act provides that any equity security
      is
      considered a penny stock unless that security is: registered and traded on
      a
      national securities exchange and meets specified criteria set forth by the
      SEC;
      authorized for quotation in the National Association of Securities Dealers’
Automated Quotation System; issued by a registered investment company; issued
      with a price of five dollars or more; or issued by an issuer with net tangible
      assets in excess of $2,000,000. This rule may affect the ability of
      broker-dealers to sell our securities.




For
      transactions covered by Rule 15g-9, a broker-dealer must furnish to all
      investors in penny stocks a risk disclosure document, make a special suitability
      determination of the purchaser, and receive the purchaser’s written agreement to
      the transaction prior to the sale. In order to approve a person’s account for
      transactions in penny stocks, the broker-dealer must (i) obtain information
      concerning the person’s financial situation, investment experience, and
      investment objectives; (ii) reasonably determine, based on that information
      that
      transactions in penny stocks are suitable for the person and that the person
      has
      sufficient knowledge and experience in financial matters to reasonably be
      expected to evaluate the transactions in penny stocks; and (iii) deliver to
      the
      person a written statement setting forth the basis on which the broker-dealer
      made the determination of suitability stating that it is unlawful to effect
      a
      transaction in a designated security subject to the provisions of Rule
      15g-9(a)(2) unless the broker-dealer has received a written agreement from
      the
      person prior to the transaction. Such written statement from the broker-dealer
      must also set forth, in highlighted format immediately preceding the customer
      signature line, that the broker-dealer is required to provide the person with
      the written statement and the person should sign and return the written
      statement to the broker-dealer only if it accurately reflects the person’s
      financial situation, investment experience and investment
      objectives.




16




*Losing
      our status as a Canadian Controlled Private Corporation*  *could
      adversely affect our financial position* :




A
      Canadian Controlled Private Corporation (“CCPC”) is a corporation that is not
      controlled by a non-Canadian entity. If, in the future, more than 50% of the
      voting shares of AC Technical are owned by a non-Canadian entity, such as by
      Laurus exercising its rights under the Share Pledge Agreement, we would lose
      our
      status as a CCPC. Unless a company is a CCPC, it is not eligible for certain
      Canadian research and development tax credits. As a non-CCPC, the maximum
      Canadian research and development tax credits are 20% (for both Federal and
      Provincial Canadian taxes) of total eligible research and development
      expenditures. AC Technical is presently entitled to claim the maximum credits
      available to CCPCs of 41.5% (for both Federal and Provincial Canadian taxes)
      of
      the total eligible expenditures. During Fiscal Year 2006, this extra 21.5%
      totaled approximately $100,000.




**Available
      Information**




We
      file
      annual, quarterly and current reports, proxy statements and other information
      with the U.S. Securities and Exchange Commission ("SEC"). Copies of this Annual
      Report on Form 10-KSB and each of our other periodic and current reports, and
      amendments to all such reports, that we file or furnish pursuant to Section
      13(a) or 15(d) of the Securities Exchange Act of 1934 are available free of
      charge on our website (http://www.creativevistasinc.com/) as soon as reasonably
      practicable after the material is electronically filed with, or furnished to,
      the SEC. The information contained on our website is not incorporated by
      reference into this Annual Report on Form 10-KSB and should not be considered
      part of this Annual Report on Form 10-KSB.




In
      addition, you may read and copy any document we file with the SEC at the SEC's
      Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. Please
      call
      the SEC at 1-800-SEC-0330 for further information on the operation of the Public
      Reference Room. Our SEC filings are also available to the public at the SEC's
      web site at http://www.sec.gov , which contains reports, proxy and information
      statements, and other information regarding issuers that file electronically
      with the SEC.


**Item
                  2.**
              **Description
                  of Property**




Our
      office is located at 2100 Forbes Street, Units 8-10, Whitby, Ontario, Canada
      L1N
      9T3. The premises, which were purchased in 2002, consist of approximately 5,900
      square feet on the ground floor and 2,200 square feet on the second floor.
      We
      believe that these offices are adequate for our present purposes and planned
      expansion. Furthermore, we believe these offices are in good condition and
      adequately covered by insurance.


**Item
                  3.**
              **Legal
                  Proceedings**




None.


**Item
                  4.**
              **Submission
                  of Matters to a Vote of Security
                  Holders**




No
      matters were submitted to security holders during the fourth quarter of the
      fiscal year covered by this report.


**Item
                  5.**
              **Market
                  for the Registrant's Common Equity, Related Stockholder Matters
                  and Issuer
                  Purchases of Equity
                  Securities**




Our
      common stock is quoted at the present time on the OTC Bulletin Board under
      the
      symbol “CVAS.” At December 31, 2006, the bid price was $0.32 per share and
      the ask price was $0.51 per share. The security is subject to Section 15(g)
      and
      Rule 15g-9 of the Securities Exchange Act of 1934, commonly referred to as
      the
      penny stock rule. See “Risk Factors—Penny Stock.” The following table shows the
      range of bid prices per share of common stock on the OTC Bulletin Board, as
      reported by Pink Sheets LLC, for the periods indicated. These quotations
      represent prices between dealers, do not include retail mark-ups, mark-downs
      or
      commissions, and do not necessarily represent actual transactions.




Quarter
                ended:
            
            Low
                Bid Price
            
            High
                Bid PriceMarch
                31, 2005
            
            $
            1.03
            
            $
            1.56June
                30, 2005
            
            $
            0.70
            
            $
            1.65September
                30, 2005
            
            $
            0.51
            
            $
            1.42December
                31, 2005
            
            $
            0.32
            
            $
            0.93March
                31, 2006
            
            $
            0.35
            
            $
            0.86June
                30, 2006
            
            $
            0.31
            
            $
            0.86September
                30, 2006
            
            $
            0.15
            
            $
            0.70December
                31, 2006
            
            $
            0.15
            
            $
            0.50




17


Our
      securities may not qualify for listing on Nasdaq or any other national exchange.
      Even if our securities do qualify for listing, we may not be able to maintain
      the criteria necessary to ensure continued listing. Our failure to qualify
      our
      securities or to meet the relevant maintenance criteria after such qualification
      may result in the discontinuance of the inclusion of our securities on a
      national exchange. In such event, trading, if any, in our securities may then
      continue in the non-Nasdaq, over-the-counter market so long as we continue
      to
      file periodic reports with the SEC and there remain sufficient qualified market
      makers in our securities. As a result, a stockholder may find it more difficult
      to dispose of, or to obtain accurate quotations as to the market value of,
      the
      our securities.




As
      of
      December 31, 2006 there were 264 beneficial holders of our Common Stock. We
      have 33,253,358 outstanding shares of Common Stock.




Our
      agreements with Laurus prohibit us from declaring or paying any dividends on
      our
      Common Stock.




**Item
                6.**
            **Management’s
                Discussion and Analysis**




**MANAGEMENT’S
      DISCUSSION AND ANALYSIS OR PLAN OF OPERATION**




The
      following discussion of the financial condition and results of operations should
      be read in conjunction with the consolidated financial statements and related
      notes thereto. The following discussion contains certain forward-looking
      statements that involve risks and uncertainties. Our actual results could differ
      materially from those discussed therein. Factors that could cause or contribute
      to such differences include, but are not limited to, risks and uncertainties
      related to the need for additional funds, the rapid growth of the operations
      and
      our ability to operate profitably a number of new projects. Except as required
      by law, we do not intend to publicly release the results of any revisions to
      those forward-looking statements that may be made to reflect any future events
      or circumstances.




**Overview
      and Recent Developments**




During
      the fiscal year 2006, we entered into an agreement, through our wholly owned
      subsidiary, Cancable Holding Corp. (“Holding”), to acquire all of the issued and
      outstanding shares of capital stock and any other equity interests of Cancable.
      To finance the acquisition, also on December 31, 2005, our subsidiaries entered
      into a loan agreement with Laurus Master Fund, Ltd. (“Laurus”) **** to
      which
      we became a guarantor.




We,
      Cancable, Holding, Covington Capital Corporation (“Covington”) and BMO Capital
      Corporation (“BMO”) entered into a Stock Purchase Agreement for the purchase by
      Holding of all the issued and outstanding shares of capital stock and any other
      equity interests of Cancable.




Cancable
      and Holding entered into a series of agreements with Laurus whereby Cancable
      issued to Laurus a secured term note (the “Note”) in the amount of $6,865,000
      and Holding issued to Laurus a related option to purchase up to 49 shares of
      common stock of Holding (up to 49% of the outstanding shares of Holding) at
      a
      price of $0.01 per share (the “Option”). The loan is secured by all of our
      assets and those of our subsidiaries. The principal amount of the Note bears
      interest at the prime rate plus one and three quarters percent with a minimum
      rate of seven percent. Cancable and Holding have granted Laurus a right of
      first
      refusal with respect to any debt or equity financings for a period of 180 days
      after closing.




On
      February 13, 2006, we and our subsidiaries, Iview, Digital Video Solutions
      Inc.
      (“Iview”), a newly formed Delaware corporation and direct subsidiary of ours,
      entered into a series of agreements with Laurus Master Fund Ltd. (“Laurus”)
      pursuant to a refinancing transaction whereby we issued to Laurus a secured
      term
      note (the “Company Note”) in the amount of $8,250,000, Iview issued to Laurus a
      secured term note (the “Iview Note”) in the amount of $2,000,000, we issued to
      Laurus a related warrant to purchase up to 2,411,003 shares of our common stock
      (up to 7.5% of our outstanding shares) at a price of $0.01 per share (the
“Warrant”) and Holding issued to Laurus a related option to purchase up to 20
      shares of common stock of Holding (up to 20% of the outstanding shares of
      Holding) at a price of $0.01 per share (the “Option”). The loans are secured by
      all of our assets and those of our subsidiaries: A.C. Technical Systems Ltd.,
      Creative Vistas Acquisition Corp., Holding, Iview, Cancable Holding Corp.,
      Cancable and Cancable, Inc.




18




**Results
      of Operations**




**Comparison
      of Year Ended December 31, 2006**


**to
      Year Ended December 31, 2005**




Since
      Holding, Cancable, and Iview Holding Corp. were acquired or formed after Fiscal
      Year 2005, the financial statements of these companies were not included in
      the
      accompany consolidated financial statements for the year ended December 31,
      2005.




**Sales** :
      Sales
      for Fiscal Year 2006 totaled $30,456,900 representing an increase of 249.4%
      from
      Fiscal Year 2005. The acquisition of Cancable was responsible for all of the
      increase in revenues. The revenue from Cancable was $23,779,400.




**(a)
      Cancable Segment** -
      We
      acquired Cancable on January 1, 2006. It is incorporated under the laws of
      Ontario and its principal business activity is the provisioning the deployment
      and servicing of broadband technologies in both residential and commercial
      markets. The Cancable service offering, network deployment, IT integration,
      and
      support services, enable the cable television and telecommunications industries
      to deliver a high quality broadband experience to their customers. Total revenue
      for Fiscal Year 2006 was $23,779,400. Rogers Cable Inc. is Cancable’s largest
      customer and the revenue from this customer for the Fiscal Year 2006 was
      approximately $18,695,200 or 78.6% of its total revenue.




**(b)
      AC Technical segment** -
      Total
      revenue of AC Technical segment was $6,492,200 compared to $8,692,300 for Fiscal
      Year 2005. Contract revenue declined to $5,229,000 for Fiscal Year 2006 compared
      to $7,395,900 for Fiscal Year 2005. This decrease was mainly due to a decrease
      in the number of subcontracts for the provision of services to government
      contracts. Contract revenue from three of our major customers was $1,295,400
      in
      2006. Service revenue generated was $1,282,400 for Fiscal Year 2006 and
      $1,296,300 for Fiscal Year 2005. There was no material fluctuation of the
      service revenue. Service revenue primarily represents the cumulative effect
      of
      the growth in contracts and number of customers over the past few years. We
      have
      experienced a significant increase in the number of inquiries for systems from
      the government and retail sector. This increased interest in security products
      and services may result in our achieving increased revenues in future periods
      if
      we are successful in attracting new customers or obtaining additional projects
      from existing customers. There is no assurance that the Company will be able
      to
      attract new customers.




**(c)
      Iview DSI segment** -
      Iview is a
      technology company that specializes in both security and digital video
      processing technologies. Expertise in both these areas enables us to address
      a
      broad spectrum of our customers' needs with intelligent and most importantly,
      reliable digital video security solutions. Total revenue for Fiscal Year 2006
      was $157,600. Iview launched its digital video security product in Fiscal Year
      2006.




Cost
      of Goods Sold :
      Cost of
      goods sold as a percentage of revenue for Fiscal Year 2006 was $20,511,000
      or
      67.3% of revenues compared to $5,831,600 or 66.9% of revenues for Fiscal Year
      2005.




**(a)
      Cancable segment** -
      Cost of
      sales in this segment were $16,981,000 for Fiscal Year 2006. Costs were
      comprised principally of labor expenses of $11,835,900, vehicle expenses of
      $2,129,400 and material costs of $2,191,400. (b) AC Technical segment - Cost
      of
      sales in this segment were $3,438,900. The material cost was $2,053,800 or
      31.5%
      of the AC Technical revenue for Fiscal Year 2006 compared to $3876,400 or 44.6%
      of revenues in Fiscal Year 2005. The decreased in percentage of the material
      cost was mainly due to some contracts with lower percentage of materials. On
      the
      other hand, labor and subcontractor costs decreased to $1,322,600 or 20.3%
      of AC
      Technical revenues for Fiscal Year 2006 and $1,843,600 or 21.1% of AC Technical
      revenues for Fiscal Year 2005. The decrease in labor and subcontractor cost
      was
      mainly due to the decrease in revenue. The percentage of the labor and
      subcontractor cost remains stable for two fiscal years. (c) Iview DSI - Cost
      of
      sales in this segment was $91,200. The balance mainly represents material and
      shipping cost.




19




Project,
      Selling, General and Administrative Expenses :
      Projects, selling, general and administrative expenses for Fiscal Year 2006
      was
      $9,143,500 or 30.0% of revenues for Fiscal Year 2006 compared to $4,032,700
      or
      46.3% of revenues for Fiscal Year 2005. The balance is mainly comprised of
      the
      following:




Project
      cost was $1,272,900 or 4.2% of revenue for Fiscal Year 2006, compared to
      $1,228,700 or 14.1% for fiscal year 2005. Project cost was mainly related to
      AC
      Technical segment. The balance mainly includes the salaries and benefits of
      indirect staff amounting to $808,200 for Fiscal Year 2006 compared to $697,100
      for Fiscal Year 2005 with no material difference. The increase in balance was
      mainly due to an increase in the staff headcount. The automobile and travel
      expenses of approximately $351,400 for Fiscal Year 2006 compared to $496,200
      for
      Fiscal Year 2005. The decrease in balance was mainly due to less travel by
      the
      staff, a decrease in the number of vehicles, and a decrease in leasing
      cost.




Selling
      expenses were $679,600 or 2.2% of revenues for Fiscal Year 2006 compared to
      $743,000 or 8.5% of revenues for Fiscal Year 2005. Selling expenses were mainly
      related to AC Technical segment. As of December 31, 2006 we had 4 salespersons
      in the AC Technical segment, which is one less than we had on December 31,
      2005.
      The balance for Fiscal Year 2006 is mainly comprised of salaries and commissions
      to salespersons of $540,600 compared to $589,300 for Fiscal Year 2005. The
      decrease was mainly due to a decrease in the staff headcount. The advertising,
      promotion and trade show expenses were $71,100 for Fiscal Year 2006 compared
      to
      $81,700 for Fiscal Year 2005 with no material fluctuation.




General
      and administrative expenses were $7,191,000 or 23.6% of revenues for Fiscal
      Year
      2006 compared to $2,061,100 or 23.6% for Fiscal Year 2005. The balance for
      Fiscal Year 2006 is comprised of $486,300 of investor relations expenses
      compared to $253,000 fees for Fiscal Year 2005. Included in the balance for
      Fiscal Year 2006, there was $356,300 relating to non-cash expenses. Total
      salaries and benefits to administrative staff were $2,683,400 for Fiscal Year
      2006 compared to $507,700 for last year. The increase was mainly due to the
      salaries and benefits of Cancable segment of $2,262,900. Total depreciation
      of
      property plant and equipment was $986,500 for Fiscal Year 2006 compared to
      $44,200 for Fiscal Year 2005. The balance for current period mainly represents
      the depreciation of vehicles and equipments of Cancable segment. Additionally,
      the balance also included amortization of intangible assets in the amount of
      $600,000 for Fiscal Year 2006.




Interest
      and Other Expenses (Income) :
      Interest and net other expenses for Fiscal Year 2006 was $6,344,200 compared
      to
      interest and other income of $1,973,800 for Fiscal Year 2005. The balance for
      Fiscal Year 2006 included amortization of deferred charges $782,900 compared
      to
      $450,500 for Fiscal Year 2005. The increase was mainly due to the deferred
      financing costs amounted to $600,500 carried forward from Fiscal Year 2005
      was
      written off during the first quarter of Fiscal Year 2006. The Company has paid
      off the entire outstanding principal amount and all obligations due to Laurus
      under the Secured Convertible Term Note dated September 30, 2004, the Secured
      Convertible Minimum Borrowing Note dated September 30, 2004, and the Secured
      Revolving Note dated September 30, 2004 through a refinancing transaction
      (details refer to Note 2, 8 and 9 of the financial statements).
      Additionally, net financing expenses increased to $4,617,000 or 15.2% of
      revenues compared to $2,307,300 or 26.5% of revenues for Fiscal Year 2005.
      The
      balance for Fiscal Year 2006 included the 2,411,003 warrants issued to Laurus
      with market value of $1,913,600 at the date of issuance, and cash payments
      of
      $539,300 as the penalties of the prepayment of the entire loans to Laurus.
      Also,
      the balance also included interest payable to Laurus of $1,683,900. The changes
      of derivative instruments expenses were $943,500 compared to income of
      $5,373,221 for Fiscal Year 2005.




Income
      taxes :
      There
      is no income tax provision for Fiscal Year 2006, which was mainly due to losses
      carried forward to offset all income generated. All prior taxes have already
      been accounted for in the income tax recoverable and therefore, there is no
      additional provision for income taxes recoverable and deferred tax
      assets.




Net
      Income/Loss :
      Net
      loss for Fiscal Year 2006 was $5,541,900 compared to a net income of $827,574
      for Fiscal Year 2005. Our operating income was $802,341 for Fiscal Year 2006
      compared to operating loss $1,146,300 for Fiscal Year 2005. The growth was
      mainly due to the acquisition of Cancable at the beginning of Fiscal Year 2006.




20




**Liquidity
      and Capital Resources**




Since
      our
      inception, we have financed our operations through bank debt, loans and equity
      from our principals, loans from third parties and funds generated by our
      business. At December 31, 2006, we had $3,560,000 in cash. We believe that
      cash
      from operations and our credit facilities with Laurus will continue to be
      adequate to satisfy our ongoing working capital needs. During Fiscal Year 2007,
      our primary objectives in managing liquidity and cash flows will be to ensure
      financial flexibility to support growth and entry into new markets and improve
      inventory management and to accelerate the collection of accounts
      receivable.




Net
      Cash Used in Operating Activities .
      Net
      cash provided in operating activities amounted to $1,027,800 for Fiscal Year
      2006. The changes in operating assets and liabilities resulted in net cash
      provided of $643,700, which included a $134,600 decrease in accounts receivable,
      a $36,900 increase in inventory, a $138,800 increase in prepaid expenses, a
      $402,600 increase in accounts payable, a $154,600 increase in income taxes
      recoverable and a $53,800 decrease in deferred revenue.




Comparative
      balance sheet as at December 31, 2006 to December 31, 2005




Accounts
      Receivable




Our
      accounts receivable increased to $3,861,100 as of December 31, 2006 from
      $2,620,100 as of December 31, 2005. This was mainly d ue
      to the
      balance as of December 31, 2006 being included in the accounts receivable of
      Cancable in the amount of $1,799,500. Accounts receivable of the AC Technical
      segment was $2,040,800 as of December 31, 2006 compared to $2,620,100 as at
      December 31, 2005. The decrease in accounts receivable of AC Technical was
      mainly due the decrease in revenue.




Inventory




Inventory
      on hand on
      December 31, 2006 increased to $764,100, compared to the balance as of
      December 31, 2005 of $580,400 which was mainly due to the balance as of
      December 31, 2006 being included in the inventory of Cancable segment in the
      amount of $250,400. Inventory of the AC Technical segment was $430,300 compared
      to $557,700 as of December 31, 2005. The level of inventory of the AC Technical
      segment decreased. This was mainly due to an improvement in
      inventory control and keeping minimum levels of inventory.




Accounts
      Payable and Accrued Liabilities




Accounts
      payable and accrued liabilities increased to $4,655,000 compared to the balance
      as of December 31, 2005 of $2,502,000 , which was mainly due to the balance
      as
      of December 31, 2006 being included Cancable segment in the amount of
      $2,643,600. The balance for the AC Technical segment was $1,826,100 as of
      December 31, 2006 compared to $2,501,100 as of December 31, 2005. The decrease
      in balance of AC Technical was mainly due to the decrease in purchases of
      material in the last twelve months and the timing of payments to our suppliers.




Deferred
      Revenue




Deferred
      revenue increased to $68,300 at December 31, 2006. This increase was mainly
      due
      to the timing of payments by our customers. Deferred revenue primarily relates
      to payments associated with the contracts where revenue is recognized on a
      percentage of completion basis. (See summary of accounting policy in our
      condensed consolidated financial statements).




Incomes
      Taxes Recoverable




The
      income taxes recoverable were mainly due to the expected refund from losses
      carried back to prior years.




Net
      Cash Received in Investing Activities .
      Net
      cash received in investing activities was $1,209,500 for the twelve months
      ending December 31, 2006 compared to net cash used in investing activities
      $125,000 for the twelve months ended December 31, 2005. The balance for the
      twelve months ending 2005 was mainly due to the note receivable to dataBahn
      of
      $125,000. The balance was repaid during Fiscal Year 2006. The current year
      balance was mainly due to cash received during the acquisition of Cacable in
      the
      amount of $1,226,800 and proceeds of sales of property and equipment in the
      amount of $454,400. Total purchase of capital assets for current fiscal year
      was
      $598,700.




Net
      Cash Provided From Financing Activities .
      Net
      cash provided from financing activities was $887,600 for the twelve months
      ending December 31, 2006 compared to net cash provided of $1,486,800 for the
      12
      months ending December 31, 2005. Current year balance mainly represents the
      additional borrowings from Laurus from the refinancing transaction in 2006.
      The
      whole entire revolving loans and convertible debts entered in 2004 were repaid
      during the same period.




21




Our
      capital requirements have grown since our inception with the growth of our
      operations and staffing. We expect our capital requirements to continue to
      increase in the future as we seek to expand our operations. On September 30,
      2004, we obtained additional funding through a series of agreements with Laurus
      (see details on Note 2 and 9 in the condensed consolidated financial
      statements). In 2006, through our wholly owned subsidiary, we acquired
      all of the issued and outstanding shares of capital stock and any other equity
      interests of Cancable. Simultaneously, Cancable entered into a series of
      agreements with Laurus whereby Cancable issued to Laurus a secured term note
      (the “Cancable Note”) in the amount of $6,865,000. Also, we completed the
      refinancing transaction in February 2006; we
      issued
      to Laurus a secured term note (the “Company Note”) in the amount of $8,250,000,
      Iview DSI issued to Laurus a secured term note (the “Iview Note”) in the amount
      of $2,000,000. Simultaneously with the closing of this refinancing transaction,
      we paid off the entire outstanding principal amount and all obligations due
      to
      Laurus under the Secured Convertible Term Note dated September 30, 2004, the
      Secured Convertible Minimum Borrowing Note dated September 30, 2004 and the
      Secured Revolving Note dated September 30, 2004 (collectively, the “2004 Notes”)
      and such 2004 Notes were subsequently cancelled.




Over
      the
      next twelve months we believe that our existing capital will be sufficient
      to
      sustain our operations. Management plans to seek additional capital in the
      future to fund operations, growth and expansion through additional equity,
      debt
      financing or credit facilities. We have had early stage discussions with
      investors about potential investment in our firm at a future date. No assurance
      can be made that such financing would be available, and if available it may
      take
      either the form of debt or equity. In either case, the financing could have
      a
      negative impact on our financial condition and our shareholders.




***Recent
      Accounting Pronouncements***




In
      February 2006, the Financial Accounting Standards Board issued SFAS 155 -
“Accounting for Certain Hybrid Financial Instruments—an amendment of FASB
      Statements No. 133 and 140.”




This
      Statement amends FASB Statements No. 133, Accounting for Derivative Instruments
      and Hedging Activities, and No. 140, Accounting for Transfers and Servicing
      of
      Financial Assets and Extinguishments of Liabilities. This Statement resolves
      issues addressed in Statement 133 Implementation Issue No. D1, “Application of
      Statement 133 to Beneficial Interests in Securitized Financial
      Assets.”




This
      Statement:




a.
            Permits
                fair value remeasurement for any hybrid financial instrument that
                contains
                an embedded derivative that otherwise would require
                bifurcation.




b.
            Clarifies
                which interest-only strips and principal-only strips are not subject
                to
                the requirements of Statement 133.




c.
            Establishes
                a requirement to evaluate interests in securitized financial assets
                to
                identify interests that are freestanding derivatives or that are
                hybrid
                financial instruments that contain an embedded derivative requiring
                bifurcation.




d.
            Clarifies
                that concentrations of credit risk in the form of subordination are
                not
                embedded derivatives.




e.
            Amends
                Statement 140 to eliminate the prohibition on a qualifying special-purpose
                entity from holding a derivative financial instrument that pertains
                to a
                beneficial interest other than another derivative financial
                instrument.




This
      Statement is effective for all financial instruments acquired or issued after
      the beginning of our first fiscal year that begins after September 15,
      2006.




The
      fair
      value election provided for in paragraph 4(c) of this Statement may also be
      applied upon adoption of this Statement for hybrid financial instruments that
      had been bifurcated under paragraph 12 of Statement 133 prior to the adoption
      of
      this Statement. Earlier adoption is permitted as of the beginning of our fiscal
      year, provided we have not yet issued financial statements, including financial
      statements for any interim period, for that fiscal year. Provisions of this
      Statement may be applied to instruments that we hold at the date of adoption
      on
      an instrument-by-instrument basis.




22




The
      Company is currently reviewing the effects of adoption of this statement but
      it
      is not expected to have a material impact on our financial
      statements.




In
      September 2006, the Financial Accounting Standards Board issued SFAS 156 -
      “Accounting for Servicing of Financial Assets—an amendment of FASB Statement No.
      140.”




This
      Statement amends FASB Statement No. 140, Accounting for Transfers and Servicing
      of Financial Assets and Extinguishments of Liabilities, with respect to the
      accounting for separately recognized servicing assets and servicing liabilities.
      This Statement:




1.
            Requires an entity to recognize a servicing
              asset or servicing liability each time it undertakes an obligation
              to
              service a financial asset by entering into a servicing contract in
              certain
              situations.2.
            Requires all separately recognized servicing
              assets and servicing liabilities to be initially measured at fair value,
              if practicable.3.
            Permits an entity to choose either the
              amortization method or the fair value measurement method for each class
              of
              separately recognized servicing assets and servicing
              liabilities.4.
            At its initial adoption, permits a one-time
              reclassification of available-for-sale securities to trading securities
              by
              entities with recognized servicing rights, without calling into question
              the treatment of other available-for-sale securities under Statement
              115,
              provided that the available-for-sale securities are identified in some
              manner as offsetting the entity’s exposure to changes in fair value of
              servicing assets or servicing liabilities that a service elects to
              subsequently measure at fair value.5.
            Requires separate presentation of servicing
              assets and servicing liabilities subsequently measured at fair value
              in
              the statement of financial position and additional disclosures for
              all
              separately recognized servicing assets and servicing
              liabilities.





Adoption
      of this Statement is required as of the beginning of the first fiscal year
      that
      begins after September 15, 2006. The adoption of this statement is not expected
      to have a material impact on our financial statements.





In
      September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements.” This
      standard establishes a standard definition for fair value, establishes a
      framework under generally accepted accounting principles for measuring fair
      value and expands disclosure requirements for fair value measurements. This
      standard is effective for financial statements issued for fiscal years beginning
      after November 15, 2007. Adoption
      of this statement is not expected to have any material effect on our financial
      position or results of operations .




In
      September 2006, the FASB issued Financial Accounting Standard No. 158,
“Employers’ Accounting for Defined Benefit Pension and Other Postretirement
      Plans, an amendment of FASB Statement Nos. 87, 88, 106, and 132(R *)* ,”
or
      FAS
      158. This Statement requires an employer that is a business entity and sponsors
      one or more single-employer defined benefit plans to (a) recognize the funded
      status of a benefit plan—measured as the difference between plan assets at fair
      value (with limited exceptions) and the benefit obligation—in its statement of
      financial position; (b) recognize, as a component of other comprehensive income,
      net of tax, the gains or losses and prior service costs or credits that arise
      during the period but are not recognized as components of net periodic benefit
      cost pursuant to FAS 87, *Employers’
      Accounting for Pensions* ,
      or FAS
      106, *Employers’
      Accounting for Postretirement Benefits Other Than Pensions* ;
      (c)
      measure defined benefit plan assets and obligations as of the date of the
      employer’s fiscal year-end statement of financial position (with limited
      exceptions); and (d) disclose in the notes to financial statements additional
      information about certain effects on net periodic benefit cost for the next
      fiscal year that arise from delayed recognition of the gains or losses, prior
      service costs or credits, and transition assets or obligations. An employer
      with
      publicly traded equity securities is required to initially recognize the funded
      status of a defined benefit postretirement plan and to provide the required
      disclosures as of the end of the fiscal year ending after December 15, 2006.
      This statement is not expected to have a significant effect on our financial
      statements.




23




In
      February 2007, the FASB issued **** Financial
      Accounting Standard No. 159 *The
      Fair Value Option for Financial Assets and Financial Liabilities—Including an
      amendment of FASB Statement No. 115* or FAS
      159. This Statement permits entities to choose to measure many financial
      instruments and certain other items at fair value. Most of the provisions of
      this Statement apply only to entities that elect the fair value option.




The
      following are eligible items for the measurement option established by this
      Statement:




1.
            Recognized
                financial assets and financial liabilities
                except:




a.
            An
                investment in a subsidiary that the entity is required to
                consolidate




b.
            An
                interest in a variable interest entity that the entity is required
                to
                consolidate




c.
            Employers’
                and plans’ obligations (or assets representing net overfunded positions)
                for pension benefits, other postretirement benefits (including health
                care
                and life insurance benefits), post employment benefits, employee
                stock
                option and stock purchase plans, and other forms of deferred compensation
                arrangements.




d.
            Financial
                assets and financial liabilities recognized under leases as defined
                in
                FASB Statement No. 13,*Accounting
                for Leases.*




e.
            Deposit
                liabilities, withdrawable on demand, of banks, savings and loan
                associations, credit unions, and other similar depository
                institutions




f.
            Financial
                instruments that are, in whole or in part, classified by the issuer
                as a
                component of shareholder’s equity (including “temporary equity”). An
                example is a convertible debt security with a noncontingent beneficial
                conversion feature.




2.
            Firm
                commitments that would otherwise not be recognized at inception and
                that
                involve only financial instruments




3.
            Nonfinancial
                insurance contracts and warranties that the insurer can settle by
                paying a
                third party to provide those goods or
                services




4.
            Host
                financial instruments resulting from separation of an embedded
                nonfinancial derivative instrument from a nonfinancial hybrid
                instrument.




The
      fair
      value option:




1.
            May
                be applied instrument by instrument, with a few exceptions, such
                as
                investments otherwise accounted for by the equity
                method




2.
            Is
                irrevocable (unless a new election date
                occurs)




3.
            Is
                applied only to entire instruments and not to portions of
                instruments.




The
      Statement is effective as of the beginning of an entity’s first fiscal year that
      begins after November 15, 2007. Early adoption is permitted as of the beginning
      of a fiscal year that begins on or before November 15, 2007, provided the entity
      also elects to apply the provisions of FASB Statement No. 157, *Fair
      Value Measurements* .
      We have
      not yet determined what effect, if any, adoption of this Statement will have
      on
      our financial position or results of operations .




24




SAB
      108 -
‘Considering the Effects of Prior Year Misstatements when Quantifying
      Misstatements in Current Year Financial Statements’




In
      September 2006, the SEC issued Staff Accounting Bulletin No. 108 (SAB 108),
      Considering the Effects of Prior Year Misstatements when Quantifying
      Misstatements in Current Year Financial Statements. SAB 108 provides guidance
      on
      the consideration of the effects of prior year unadjusted errors in quantifying
      current year misstatements for the purpose of a materiality assessment. Adoption
      of this statement is not expected to have any material effect on our financial
      position or results of operations .




FIN
      48 -
‘Accounting for Uncertainty in Income Taxes’




In
      June
      2006, the FASB issued Interpretation No. 48 (“FIN 48”), “Accounting for
      Uncertainty in Income Taxes”, an interpretation of SFAS No. 109. FIN 48
      prescribes a comprehensive model for how companies should recognize, measure,
      present and disclose uncertain tax positions taken or expected to be taken
      on a
      tax return. Under FIN 48, we shall initially recognize tax positions in the
      financial statements when it is more likely than not the position will be
      sustained upon examination by the tax authorities. We shall initially and
      subsequently measure such tax positions as the largest amount of tax benefit
      that is greater than 50% likely of being realized upon ultimate settlement
      with
      the tax authority assuming full knowledge of the position and all relevant
      facts. FIN 48 also revises disclosure requirements to include an annual tabular
      roll-forward of unrecognized tax benefits. We will adopt this interpretation
      as
      required in 2007 and will apply its provisions to all tax positions upon initial
      adoption with any cumulative effect adjustment recognized as an adjustment
      to
      retained earnings. Adoption
      of this statement is not expected to have any material effect on our financial
      position or results of operations.




EITF
      00-19-2, "Accounting for Registration Payment Arrangements".




In
      December 2006, the FASB issued Staff Position FSP EITF 00-19-2, "Accounting
      for
      Registration Payment Arrangements". This statement is effective for existing
      registration payment arrangements as of January 1, 2007, with earlier
      application permitted in previously-unissued financial statements. As discussed
      in Note 8 and as permitted by the FSP, we adopted the provisions of this FSP
      in
      our fourth quarter of 2006, resulting in re-classification of certain of our
      outstanding warrants from derivative instrument liabilities to
      equity.




**Off
      Balance Sheet Arrangements**




None ****




**DISCUSSION
      OF CRITICAL ACCOUNTING ESTIMATES**




Critical
      accounting estimates are those that management deems to be most important to
      the
      portrayal of our financial condition and results of operations, and that require
      management’s most difficult, subjective or complex judgments, due to the need to
      make estimates about the effects of matters that are inherently uncertain.
      We
      have identified six critical accounting estimates: accounts receivable
      allowances, goodwill, revenue, inventory, accounting for income taxes and
      financial instrument.




Accounts
      receivable allowances are determined using a combination of historical
      experience, current information and management judgment. Actual collections
      may
      differ from our estimates. A 10% increase in the accounts receivable allowance
      would increase bad debt expense by $20,000.




Goodwill
      represents the excess of cost over the net tangible and identifiable assets
      acquired in business combinations and are stated at cost. Goodwill and
      intangibles with indefinite lives are not amortized but tested for impairment
      no
      less frequently than annually. Impairment is measured by comparing the carrying
      value to fair value using quoted market prices, a discounted cash flow model,
      or
      a combination of both.




We
      derive
      revenues from contract revenue and services revenue, which include assistance
      in
      implementation, integration, customization, maintenance, training and
      consulting. We recognize revenue for contract and services in accordance with
      Statement of Position (SOP) 81-1, “Accounting for Certain Construction Type and
      Certain Production Type Contracts,” and SEC Staff Accounting Bulletin (SAB) 104,
“Revenue Recognition,” and EITF 00-21 Accounting for Revenue Arrangements with
      Multiple Deliverables. Contract revenue consists of fees generated from
      installation of security systems. Services revenue consists of fees generated
      by
      providing monitoring services, preventive maintenance and technical support,
      product maintenance and upgrades. Monitoring services and preventive maintenance
      and technical support are generally provided under contracts for terms varying
      from one to six years. A customer typically prepays monitoring services,
      preventive maintenance and technical support fees for an initial period. The
      related revenue is deferred and generally recognized over the term of such
      initial period. Rates for product maintenance and upgrades are generally
      provided under time and material contracts. Revenue for these services is
      recognized in the period in which the services are provided.




25


We
      record
      inventory at the lower of cost and net realizable value. Cost is determined
      on a
      first-in, first-out basis. We write down our inventory for obsolescence, and
      excess inventories based on assumptions about future demand and market
      conditions. The business environment in which we operate is subject to customer
      demand. If actual market conditions are less favorable than those estimated,
      additional material inventory write-down may be required. A 10% increase in
      inventory reserve would increase expenses by $0.1 million.




Income
      taxes are calculated based on the expected treatment of transactions recorded
      in
      the consolidated financial statements. In determining current and deferred
      components of income taxes, we interpret tax legislation and make assumptions
      about the timing of the reversal of deferred tax assets and liabilities. If
      our
      interpretations differ from those of tax authorities or if the timing of
      reversals is not as anticipated, the provision for income taxes could increase
      or decrease in future periods.




We
      review
      the terms of convertible debt and equity instruments we issue to determine
      whether there are embedded derivative instruments, including the embedded
      conversion option, that are required to be bifurcated and accounted for
      separately as a derivative financial instrument. Generally, where the ability
      to
      physical or net-share settle the conversion option is deemed to be not within
      our control, the embedded conversion option is required to be bifurcated and
      accounted for as a derivative financial instrument liability.




In
      connection with the sale of convertible debt and equity instruments, we may
      also
      issue freestanding options or warrants. Additionally, we may issue options
      or
      warrants to non-employees in connection with consulting or other services they
      provide. Although the terms of the options and warrants may not provide for
      net-cash settlement, in certain circumstances, physical or net-share settlement
      is deemed to not be within the control of the company and, accordingly, we
      are
      required to account for these freestanding options and warrants as derivative
      financial instrument liabilities, rather than as equity.




Derivative
      financial instruments are initially measured at their fair value. For derivative
      financial instruments that are accounted for as liabilities, the derivative
      instrument is initially recorded at its fair value and is then re-valued at
      each
      reporting date, with changes in the fair value reported as charges or credits
      to
      income. For option-based derivative financial instruments, we use the
      Black-Scholes option pricing model to value the derivative instruments. Any
      discount from the face value of the convertible debt instrument is amortized
      over the life of the instrument through periodic charges to income, using the
      effective interest method. The classification of derivative instruments,
      including whether such instruments should be recorded as liabilities or as
      equity, is re-assessed at the end of each reporting period. Derivative
      instrument liabilities are classified in the balance sheet as current or
      non-current based on whether or not net-cash settlement of the derivative
      instrument is expected within 12 months of the balance sheet date.




**Commitments**




We
      have
      entered into contracts for certain consulting ser v ices
      providing for monthly payments and are required to repay the principal of our
      convertible notes and promissory notes due to Laurus and other parties. In
      addition, we have also entered into an operating lease for our vehicles,
      computer and office equipment. The total minimum annual payments for the next
      five years are as follows:




**Payments
                  due by**
                **Period****Total**
              
              **2007**
              
              **2008**
              
              **2009**
              
              **2010**
              
              **2011**
              
              **Thereafter****Term
                  notes**
              
              $
              16,869,822
              
              $
              2,584,879
              
              $
              2,240,356
              
              $
              237,500
              
              $
              5,050,000
              
              $
              6,757,087
              
              $
              -**Other
                  Notes Payable**
              
              
              28,736
              
              
              28,736
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -**Note
                  payable to related parties**
              
              
              1,500,000
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              1,500,000**Operating
                  leases**
              
              
              933,700
              
              
              467,800
              
              
              327,400
              
              
              138,500
              
              
              -
              
              
              -
              
              
              -**Capital
                  leases**
              
              
              2,499,740
              
              
              807,470
              
              
              535,070
              
              
              768,766
              
              
              363,985
              
              
              24,449
              
              
              -**Commitments****related
                  to****consulting****agreements**
              
              
              1,961,700
              
              
              598,600
              
              
              652,200
              
              
              710,900
              
              
              -
              
              
              -
              
              
              -$
              23,793,698
              
              $
              4,487,485
              
              $
              3,755,026
              
              $
              1,855,666
              
              $
              5,413,985
              
              $
              6,781,536
              
              $
              1,500,000


The
      figures in the above table do not include interest costs.




26


**Item
                7.**
            **Financial
                Statements**




**INDEX
      TO FINANCIAL STATEMENTS**




**Creative
      Vistas, Inc.**




**Consolidated
      Financial Statements**




**For
      the years ended December 31, 2006 and 2005**


Report
                  of Independent Registered Public Accounting Firm
              F-1Balance
                  Sheets
              F-2Statement
                  of Stockholders’ (Deficiency) and Other Comprehensive
                  (loss)
              F-3Statements
                  of Operations
              F-4Statements
                  of Cash Flows
              F-5Notes
                  to Financial Statements
              F-6
                  - F-31


**REPORT
      OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**




Stockholders
      and Board of Directors




**Creative
      Vistas, Inc** .




We
      have
      audited the accompanying consolidated balance sheets of Creative Vistas, Inc.
      as
      of December 31, 2006 and 2005, and the related consolidated statements of
      operations, and comprehensive (loss), stockholders’ (deficiency) and cash flows
      for the years ended December 31, 2005 and 2006. 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 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 Creative Vistas, Inc. as of
      December 31, 2006 and 2005, and results of its operations and its cash flows
      for
      the years ended December 31, 2006 and 2005, in conformity with accounting
      principles generally accepted in the United States of America.




The
      accompanying financial statements have been prepared assuming that the Company
      will continue as a going concern. As discussed in Note 1 to the financial
      statements, the Company has suffered recurring losses from operations and has
      a
      stockholder deficiency. These factors raise substantial doubt about the
      Company’s ability to continue as a going concern. Management’s plans in regard
      to this matter are also discussed in Note 1. The financial statements do not
      include any adjustments that might result from the outcome of this
      uncertainty.





Stark
      Winter Schenkein & Co., LLP




Denver,
      Colorado




April
      9,
      2007




F-1




**Creative
                Vistas, Inc.****Consolidated
                Balance Sheets****December
                31**
            
            
            **2006**
            
            
            **2005****Assets****Current
                Assets**Cash
                and bank balances
            
            $
            **3,560,181**
            
            $
            **532,694**Accounts
                receivable, net of allowancefor
                doubtful accounts $ 218,450 (2005-$172,414)
            
            
            **3,861,036**
            
            
            **2,620,090**Income
                tax recoverable
            
            
            **351,344**
            
            
            **501,966**Inventory
            
            
            **764,077**
            
            
            **580,350**Prepaid
                expenses
            
            
            **237,288**
            
            
            **31,353**Note
                receivable
            
            
            **-**
            
            
            **93,744**Due
                from related parties
            
            
            **2,203**
            
            
            **2,203****Total
                current assets**
            
            
            **8,776,129**
            
            
            **4,362,400****Property
                and equipment, net of depreciation**
            
            
            **3,824,555**
            
            
            **804,907****Deposits**
            
            
            **156,080**
            
            
            **-****Goodwill**
            
            
            **2,893,845**
            
            
            **-****Restricted
                cash**
            
            
            **339,028**
            
            
            **-****Deferred
                financing costs, net**
            
            
            **647,542**
            
            
            **600,479****Other
                assets**
            
            
            **-**
            
            
            **35,210****Intangible
                assets**
            
            
            **1,600,000**
            
            
            **-****Deferred
                income taxes**
            
            
            **32,746**
            
            
            **13,779****$**
            **18,269,925**
            
            **$**
            **5,816,775****Liabilities
                and Stockholders' (Deficiency)****Current
                Liabilities**Revolving
                credit facilities
            
            $
            **-**
            
            $
            **2,128,435**Accounts
                payable
            
            
            **2,578,985**
            
            
            **1,779,918**Accrued
                salaries and benefits
            
            
            **1,157,552**
            
            
            **91,518**Accrued
                commodity taxes
            
            
            **421,753**
            
            
            **172,371**Accrued
                liabilities
            
            
            **496,698**
            
            
            **457,246**Current
                portion of obligation under capital leases
            
            
            **710,375**
            
            
            **-**Deferred
                income
            
            
            **68,245**
            
            
            **15,875**Deferred
                income taxes
            
            
            **22,770**
            
            
            **3,803**Current
                portion of convertible notes
            
            
            **-**
            
            
            **1,100,000**Current
                portion of term notes
            
            
            **2,439,046**
            
            
            **-**Current
                portion of other notes payable
            
            
            **28,736**
            
            
            **143,678**Due
                to related parties
            
            
            **2,501**
            
            
            **903****Total
                current liabilities**
            
            
            **7,926,661**
            
            
            **5,893,747****Term
                notes**
            
            
            **14,430,776**
            
            
            **-****Convertible
                notes**
            
            
            **-**
            
            
            **1,171,499****Notes
                payable to related parties**
            
            
            **1,500,000**
            
            
            **1,500,000****Other
                notes payable**
            
            
            **-**
            
            
            **28,736****Obligation
                under capital lease**
            
            
            **1,789,365**
            
            
            **-****Due
                to related parties**
            
            
            **199,025**
            
            
            **199,025****Derivative
                financial instruments**
            
            
            **-**
            
            
            **328,280****25,845,827**
            
            
            **9,121,287****Stockholders'
                (deficiency)**Share
                capitalAuthorized50,000,000
                no par value preferred shares undesignated100,000,000
                no par value common shares 33,253,358 and 32,101,706 shares issued
                and
                outstandingCommon
                stock
            
            
            **517,990**
            
            
            **-**Additional
                  paid-in capital
            
            
            **3,887,706**
            
            
            **(297,695**
            **)**Deferred
                compensation
            
            
            **-**
            
            
            **(164,000**
            **)**Accumulated
                (deficit)
            
            
            **(11,863,862**
            **)**
            
            **(2,777,802**
            **)**Accumulated
                other comprehensive losses
            
            
            **(117,736**
            **)**
            
            **(65,015**
            **)****(7,575,902**
            **)**
            
            **(3,304,512**
            **)****$**
            **18,269,925**
            
            **$**
            **5,816,775**




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




F-2


**Creative
      Vistas, Inc.**


**Consolidated
      Statement of Stockholders’ (Deficiency)**




**Shares**
            
            
            **Amount**
            
            
            **Additional
                paid-in**
              **capital**
            
            
            **Deferred**
              **Compensation**
            
            
            **Accumulated**
              **(deficit)**
            
            
            **Accumulated**
              **other**
              **comprehensive**
              **(losses)**
            
            
            **Total
                Stockholders’**
              **(deficiency)****Balance,
                December 31, 2004**
            
            
            30,135,000
            
            $
            **-**
            
            $
            (2,087,784
            )
            $
            
            
            $
            (3,605,376
            )
            $
            (13,709
            )
            $
            (5,706,869
            )Stock-based
                compensation to non-employees
            
            
            592,500
            
            
            -
            
            
            374,000
            
            
            (164,000
            )
            
            -
            
            
            -
            
            
            210,000Conversion
                of options
            
            
            1,200,000
            
            
            -
            
            
            1,268,041
            
            
            -
            
            
            -
            
            
            -
            
            
            1,268,041Conversion
                of note payable into shares
            
            
            174,216
            
            
            -
            
            
            148,048
            
            
            -
            
            
            -
            
            
            -
            
            
            148,048Net
                income
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            827,574
            
            
            -
            
            
            827,574Translation
                adjustment
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (51,306
            )
            
            (51,306
            )**Balance,
                December 31, 2005**
            
            
            **32,101,716**
            
            
            **-**
            
            
            **(297,695**
            **)**
            
            **(164,000**
            **)**
            
            **(2,777,802**
            **)**
            
            **(65,015**
            **)**
            
            **(3,304,512**
            **)**Stock-based
                compensation
            
            
            1,151,642
            
            
            517,990
            
            
            -
            
            
            164,000
            
            
            -
            
            
            -
            
            
            681,990Cumulative
                effect as of October 1, 2006 of change in accounting principle for
                registration payment arrangements
            
            
            -
            
            
            -
            
            
            4,121,871
            
            
            -
            
            
            (3,544,168
            )
            
            -
            
            
            577,703Value
                of Stock Options issued to employees
            
            
            -
            
            
            -
            
            
            63,530
            
            
            -
            
            
            -
            
            
            -
            
            
            63,530Net
                (loss)
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (5,541,892
            )
            
            -
            
            
            (5,541,892
            )Translation
                adjustment
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            -
            
            
            (52,721
            )
            
            (52,721
            )**Balance,
                December 31, 2006**
            
            
            **33,253,358**
            
            **$**
            **517,990**
            ****
            **$**
            **3,887,706**
            ****
            **$**
            **-**
            ****
            **$**
            **(11,863,862**
            **)**
            **$**
            **(117,736**
            **)**
            **$**
            **(7,575,902**
            **)**







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




F-3


**Creative
                Vistas, Inc.****Consolidated
                Statement of Operations and Comprehensive
                (loss)****For
              the years ended December 31**




**2006**
            
            **2005****Contract
                and service revenue**Contract
            
            $
            **5,352,841**
            
            **$**
            **7,421,696**Service
            
            
            **25,061,831**
            
            
            **1,296,347**Others
            
            
            **42,225**
            
            
            **-****30,456,897**
            
            
            **8,718,043****Cost
                of sales**Contract
            
            
            **3,055,938**
            
            
            **5,231,426**Service
            
            
            **17,455,096**
            
            
            **600,195****20,511,034**
            
            
            **5,831,621****Gross
                margin**
            
            
            **9,945,863**
            
            
            **2,886,422****Operating
                expense**Project
            
            
            **1,272,891**
            
            
            **1,228,657**Selling
            
            
            **591,125**
            
            
            **742,966**Selling
                - Non-cash stock compensation
            
            
            **88,495**
            
            
            **-**General
                and administrative
            
            
            **6,597,516**
            
            
            **1,710,028**General
                and administrative - Non-cash stock compensation
            
            
            **593,495**
            
            
            **351,038****9,143,522**
            
            
            **4,032,689****Income
                (loss) from operations**
            
            
            **802,341**
            
            
            **(1,146,267**
            **)****Interest
                expenses and other expenses (income)**Net
                financing expenses
            
            
            **4,617,825**
            
            
            **2,307,270**Written
                off goodwill
            
            
            **-**
            
            
            **503,900**Liquidated
                damages
            
            
            **-**
            
            
            **137,703**Amortization
                of deferred financing costs
            
            
            **782,881**
            
            
            **450,507**Derivative
                instruments
            
            
            **943,527**
            
            
            **(5,373,221**
            **)****6,344,233**
            
            
            **(1,973,841**
            **)**Income
                (loss) before income taxes
            
            
            **(5,541,892**
            **)**
            
            **827,574**Income
                taxes
            
            
            **-**
            
            
            **-**Net
                income (loss)
            
            
            **(5,541,892**
            **)**
            
            **827,574**Other
                comprehensive (loss):Foreign
                currency translation adjustment
            
            
            **(52,721**
            **)**
            
            **(51,306**
            **)**Comprehensive
                (loss)
            
            $
            **(5,594,613**
            **)**
            $
            **776,268**Basic
                weighted-average shares
            
            
            **32,394,008**
            
            
            **30,945,604****Basic income
                (loss) per share**
            
            $
            **(0.17**
            **)**
            **$**
            **0.02****Diluted
                (loss) per share**
            
            $
            **(0.17**
            **)**
            **$**
            **(0.06**
            **)**




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




F-4




**Creative
                Vistas, Inc.****Consolidated
                Statements of Cash Flows****For
              the years ended December 31**




**2006**
            
            **2005****Operating
                activities**Net
                income (loss)
            
            **$**
            **(5,541,892**
            **)**
            **$**
            **827,574**Adjustments
                to reconcile net income (loss) to net cash provided by (used in)
                operating
                activitiesDepreciation
                of capital assets
            
            
            **982,677**
            
            
            **44,215**Amortization
                of intangible assets
            
            
            **604,057**
            
            
            **4,476**Amortization
                of deferred financing cost
            
            
            **186,261**
            
            
            **450,507**Derivative
                instruments
            
            
            **3,020,136**
            
            
            **(3,734,876**
            **)**Written
                off deferred charges
            
            
            **600,481**
            
            
            **-**Gain
                on disposal of capital assets
            
            
            **(228,113**
            **)**
            
            **-**Bad
                debt expenses
            
            
            **14,987**
            
            
            **132,231**Goodwill
                written off
            
            
            **-**
            
            
            **503,900**Liquidated
                damages
            
            
            **-**
            
            
            **137,703**Stock-based
                compensation expenses
            
            
            **681,990**
            
            
            **351,038**Amortization
                of employee stock option
            
            
            **63,530**
            
            
            **-**Changes
                in non-cash working capital balanceAccounts
                receivable
            
            
            **134,618**
            
            
            **(25,836**
            **)**Inventory
            
            
            **36,862**
            
            
            **(9,448**
            **)**Prepaid
                expenses
            
            
            **(138,823**
            **)**
            
            **(8,470**
            **)**Accounts
                payable and other accrued liabilities
            
            
            **402,610**
            
            
            **561,705**Deferred
                revenue
            
            
            **53,760**
            
            
            **(173,595**
            **)**Income
                taxes payable
            
            
            **154,621**
            
            
            **(157,090**
            **)**Net
              cash provided by (used in) operating activities
            
            
            **1,027,762**
            
            
            **(
                1,095,966**
            **)****Investing
                activities**Cash
                received with acquisition of Cancable
            
            
            **1,226,756**
            
            
            **-**Proceeds from
                sales of property and equipment
            
            
            **456,442**
            
            
            **-**Purchase
                of property and equipment
            
            
            **(598,707**
            **)**
            
            **-**Note
                receivable (advances) payment
            
            
            **125,000**
            
            
            **(125,000**
            **)**Net
                cash (used in) investing activities
            
            
            **1,209,491**
            
            
            **(125,000**
            **)****Financing
                activities**Proceeds
                from bank indebtedness
            
            
            **35,934**
            
            
            **232,736**Repayment of
                notes payable
            
            
            **(147,492**
            **)**
            
            **-**Due
                to related parties
            
            
            **1,641**
            
            
            **(3,960**
            **)**Proceeds
                from term note
            
            
            **2,120,102**
            
            
            **-**Proceeds
                from convertible notes
            
            
            **-**
            
            
            **1,250,000**Repayment
                of capital lease
            
            
            **(975,527**
            **)**
            
            **-**Restricted
                cash
            
            
            **169,670**
            
            
            **-**Repayment
                of convertible notes
            
            
            **(316,803**
            **)**
            
            **-**Exercise
                of options
            
            
            **-**
            
            
            **8,041**Net
                cash provided by financing activities
            
            
            **887,525**
            
            
            **1,486,817**Effect
                of foreign exchange rate changes on cash
            
            
            **(97,291**
            **)**
            
            **(110,834**
            **)**Net
                change in cash and cash equivalents
            
            
            **3,027,487**
            
            
            **155,017****Cash
                and cash equivalents,**beginning of period
            
            
            **532,694**
            
            
            **377,677****Cash
                and cash equivalents,**end of period
            
            **$**
            **3,560,181**
            
            **$**
            **532,694**


Supplemental
                Cash Flow InformationCash
                paid for the interest
              
              $
              2,536,082
              
              $
              370,001Cash
                paid for income taxes
              
              $
              -
              
              $
              -Loan
                interest or penalties paid with warrant
              
              $
              1,913,571
              
              $
              137,703Repayment
                of convertible notes and revolving
              
              $
              7,099,786
              
              $
              -credit
                facilities through the proceeds of refinancingCapital
                assets purchase through capital leases
              
              $
              1,617,715
              
              $
              -Common
                shares issued for consulting fees,professional
                and bonus
              
              $
              681,990
              
              $
              351,038Other
                note payable converted to equity
              
              $
              -
              
              $
              105,193
 (a)  In
        January 2006, the Company entered into a series of agreements with Laurus
        whereby Cancable Inc. issued to Laurus a secured term note in the amount
        of
        $6,865,000. The proceeds of the term note was used to pay off certain debts
        of
        Cancable Inc. to its previous stockholders, Covington and BMO, in the amount
        of
        $6,013,500 and professional fees in the amount of $650,600. Cancable Inc.
        has
        received cash $201,000 from this transaction. Part of the professional fees
        with
        the amount of $455,400 (see Note 7) was recorded as deferred financing
        costs.
 (b)  In
        February 2006, the Company has entered into a series of agreements with Laurus
        for the refinancing transaction whereby the Company issued to Laurus a secured
        term note in the amount of $8,250,000. The proceeds of the term note was
        used to
        pay off outstanding revolving credit facilities (see Note 8) and convertible
        term notes (see Note 9) in the amount of $7,099,786, prepayment penalties
        in the
        amount of $539,300 and professional fees in the amount of $117,600. The
        professional fees were recorded as deferred financing costs (see Note
        7). The Company has received cash $493,200 from this transaction.
 (c)  During
        the refinancing transaction mentioned above, the Company also issued a secured
        term note in the amount of $2,000,000. $500,000 was restricted cash which
        the
        Company has used it for the repayment of principal and interest of this term
        note. After the payment of professional fees in the amount of $148,000, the
        Company has received cash $1,425,402 for this transaction. The professional
        fees
        was recorded as deferred financing costs (see Note 7).


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




F-5




**Creative
                Vistas, Inc.****Notes
                to Consolidated Financial Statements****For
                the years ended December 31, 2006 and 2005**


**1.**  **Summary
      of Accounting Policies**




**Basis
      of presentation**




The
      accompanying financial statements as at and for the years ended December 31,
      2006 and 2005 have been prepared by management in accordance with United States
      generally accepted accounting principles (“GAAP”) applicable to the respective
      periods.




The
      consolidated balance sheets as at December 31, 2006 and statement of operations,
      equity and cash flows for the year end December 31, 2006 include the
      accounts of Creative Vistas, Inc. (“CVAS”), Creative Vistas Acquisition Corp.
      (“AC Acquisition”), AC Technical Systems Ltd. (“AC Technical”), Cancable Holding
      Corp. (“Cancable Holding”), Cancable Inc., Cancable, Inc., Iview Holding Corp.
      (“Iview Holding”), and Iview Digital Solutions Inc. (“Iview DSI”). The
      consolidated balance sheets as at December 31, 2005 and statement of operations
      and cash flows for the year end December 31, 2005 include the accounts of CVAS,
      AC Acquisition, AC Technical and Iview DSI. All material inter-company accounts,
      transactions and profits have been eliminated.




**Reclassifications**




Certain
      amounts from the December 31, 2005 financial statements have been reclassified
      to conform to the current year’s presentation.




**Liquidity
      and going concern**




Our
      consolidated financial statements were prepared using accounting principles
      generally accepted in the United States of America applicable to a going
      concern, which contemplates the realization of assets and liquidation of
      liabilities in the normal course of business. We have incurred a loss of
      $5,541,892 for the year ended December 31, 2006 and have an accumulated deficit
      of $11,863,862  at
      December 31, 2006.




We
      have
      outstanding term loans aggregating $16,869,822, together with common stock
      options and warrants, held by Laurus. We do not currently have the ability
      to
      repay the notes in the event of a demand by the holder. Furthermore, we granted
      a security interest to Laurus in substantially all of our assets and,
      accordingly, in the event of any default under our agreements with Laurus,
      they
      could conceivably attempt to foreclose on our assets, which could cause us
      to
      terminate our operations.




Over
      the
      next twelve months the Company believes that its existing capital will be
      sufficient to sustain its operations. Management plans to seek additional
      capital in the future to fund operations, growth and expansion through
      additional equity, debt financing or credit facilities. The Company has had
      early stage discussions with investors about potential investment in the Company
      at a future date. No assurance can be made that such financing would be
      available, and if available it may take either the form of debt or equity.
      In
      either case, the financing could have a negative impact on our financial
      condition and our shareholders. The Company has introduced cost cutting
      initiatives within the Administration, Project and Selling departments to
      improve efficiency within the Company and also improve cash flow. The Company
      has also increased its rates for service provided by AC Technical by 20 percent
      to improve gross margins. This is in line with our competitors. The Company
      also
      expects to see the benefits of its research and development efforts within
      the
      next 12 months as it starts to introduce its own line of customized products
      to
      the industry. These products and technologies are expected to improve gross
      margins. The Company believes that it will be eligible for research and
      development tax credits at year end for its research and development efforts
      during the year and these are additional sources of cash flow for the Company.
      The Company is also negotiating longer credit terms with its suppliers from
      45
      days to 60 to 75 days. For all the reasons mentioned above, we believe that
      we
      have adequate short term borrowing capability and that we will be able to
      sustain our operations and continue as a going concern for a reasonable period
      of time although there can be no assurance of this.




F-6




The
      financial statements do not include any adjustments to reflect the possible
      future effects on the recoverability and classification of assets or the amounts
      and classification of liabilities that may result from the possible inability
      of
      the Company to continue as a going concern.




**Cash
      and Cash Equivalents**




The
      Company considers all cash and highly liquid investments purchased with an
      initial maturity of three months or less to be cash and cash
      equivalents.




The
      Company maintains its cash in bank deposit accounts that, at times, may exceed
      federally insured limits. The Company has not experienced any losses in such
      accounts and believes it is not exposed to any significant credit risks on
      cash
      and cash equivalents.




The
      Company’s cash and cash equivalents were $3,560,181 and $532,694 as at December
      31, 2006 and 2005.




**Accounts
      Receivable**




The
      Company extends credit to its customers based upon a written credit policy.
      Accounts receivable are recorded at the invoiced amount and do not bear
      interest. The allowance for doubtful accounts is the Company’s best estimate for
      the amount of probable credit losses in the Company’s existing accounts
      receivable. The Company establishes an allowance for doubtful accounts based
      upon factors surrounding the credit risk of specific customers, historical
      trends, and other information. Receivable balances are reviewed on an aged
      basis
      and account balances are charged off against the allowance after all means
      of
      collection have been exhausted and the potential for recovery is considered
      remote.




**Investment
      Tax Credits**




Investment
      tax credits are accrued when qualifying expenditures are made and there is
      reasonable assurance that the credits will be realized. Investment tax credits
      earned with respect to current expenditures for qualified research and
      development activities are included in the statement of operations as a
      reduction of expenses. Tax credits earned with respect to capital expenditures
      are applied to reduce the cost of the related capital assets.




**Research
      and Development Expenditures**




Research
      and development costs (other than capital expenditures) are expensed as
      incurred. Expenditures are reduced by any related investment tax
      credits.




**Inventory**




Inventory
      consists of materials and supplies and is stated at the lower of cost and market
      value. Cost is generally determined on the first in, first out basis. The
      inventory is net of estimated obsolescence, and excess inventory based upon
      assumptions about future demand and market conditions. Inventory consists
      principally of parts, materials and supplies.




**Property
      and Equipment**




Property
      and equipment is stated at original cost. Expenditures for improvements that
      significantly add to productive capacity or extend the useful life of an asset
      are capitalized. Expenditures for maintenance and repairs are expensed when
      incurred. Depreciation per annum is computed over the estimated useful life
      as
      follows:


Industrial
                  condominium
              4%
                  declining balance basisLeasehold
                  improvements
              lesser
                  of 5 years or the term of the lease straight-line basisOffice
                  equipment
              20%
                  declining balance basis or 3 years straight-line methodOffice
                  equipment under capital leases
              3
                  years straight-line methodFurniture
                  and fixtures
              20%
                  declining balance basis or 3 years straight-line methodFurniture
                  and fixtures under capital leases
              5
                  years straight-line methodComputer
                  hardware and software
              30%
                  declining balance basis or 3 years straight-line methodComputer
                  hardware and software under capital leases
              3
                  years straight-line methodVehicles
              4
                  years straight-line basisVehicles
                  under capital leases
              4
                  years straight-line basisTools
                  and equipment
              3
                  years straight-line basis
 
 F-7




**Customer
      Relationships and Trade Name**




Customer
      relationships and trade name represents the acquisition cost of an acquired
      customer relationships and trade name of Cancable and is recorded at cost less
      accumulated amortization. Amortization for customer relationships and trade
      name
      is provided on a straight-line basis over the period of expected benefit of
      5
      and 3 years. The Company reviews the revenues from the customer list at each
      balance sheet date to determine whether circumstances indicate that the carrying
      amount of the asset should be assessed. Amortization charged to operations
      aggregated $600,000 in 2006 (see Note 2).




**Long-Lived
      Assets**




The
      Company reviews its long-lived assets for impairment at each balance sheet
      date
      and whenever events or changes in circumstances indicate that the carrying
      amount of an asset should be assessed. To determine if an impairment exists,
      the
      Company estimates the future undiscounted cash flows expected to result from
      the
      use of the asset being reviewed for impairment. If the sum of these expected
      future cash flows is less than the carrying amount of the asset, the Company
      recognizes an impairment loss in accordance with Statement of Accounting
      Standards No. 144, Accounting for the Impairment or Disposal of Long-Lived
      Assets. The amount of the impairment recognized is determined by estimating
      the
      fair value of the assets and recording a loss for the excess of the carrying
      value over the fair value.




**Goodwill**




Goodwill
      is evaluated for potential impairment on an annual basis or whenever events
      or
      circumstances indicate that impairment may have occurred. SFAS No. 142,
“Goodwill and Other Intangible Assets”, requires that goodwill be tested for
      impairment using a two-step process. The first step of the goodwill impairment
      test, used to identify potential impairment, compares the estimated fair value
      of the reporting unit containing goodwill with the related carrying amount.
      If
      the estimated fair value of the reporting unit exceeds its carrying amount,
      the
      reporting unit’s goodwill is not considered to be impaired and the second step
      of the impairment test is unnecessary. If the reporting unit’s carrying amount
      exceeds its estimated fair value, the second step test must be performed to
      measure the amount of the goodwill impairment loss, if any. The second step
      test
      compares the implied fair value of the reporting unit’s goodwill, determined in
      the same manner as the amount of goodwill recognized in a business combination,
      with the carrying amount of such goodwill. If the carrying amount of the
      reporting unit’s goodwill exceeds the implied fair value of the goodwill so
      calculated, an impairment loss is recognized in an amount equal to the excess.
      We recorded an impairment charge of $503,900 at December 31, 2005. Management
      determined there was no additional impairment at December 31, 2006.




**Deferred
      Financing Costs**




Deferred
      financing costs represent costs directly related to obtaining of financing.
      Deferred financing costs are amortized over the term of the related indebtedness
      using the effective interest method.




**Issuance
      of Equity Instruments for Services**




In
      December 2004, the FASB issued SFAS 123 (revised 2004) “Share-Based Payment”.
      This Statement requires that the cost resulting from all share-based
      transactions be recorded in the financial statements. The Statement establishes
      fair value as the measurement objective in accounting for share-based payment
      arrangements and requires all entities to apply a fair-value-based measurement
      in accounting for share-based payment transactions with employees. The Statement
      also establishes fair value as the measurement objective for transactions in
      which an entity acquires goods or services from non-employees in share-based
      payment transactions. The Statement replaces SFAS 123 “Accounting for
      Stock-Based Compensation” and supersedes APB Opinion No. 25 “Accounting for
      Stock Issued to Employees”. The provisions of this Statement were effective for
      the Company beginning with its fiscal year ending December 31, 2006. Stock-based
      awards to non-employees are accounted for whichever is more reliably measurable
      in accordance with the provisions of the FASB issued SFAS 123 (revised 2004)
      “Share-Based Payment” and Emerging Issues Task Force (“EITF”) Issue No. 96-18,
      Accounting for Equity Instruments That Are Issued to Other Than Employees for
      Acquiring, or in Conjunction with Selling, Goods and Services.




**Revenue
      Recognition**




F-8




Contract
      Revenue




Software
      Related Services - Software related services include services to customize
      or
      enhance the software so that the software performs in accordance with specific
      customer requirements. As these services are essential to provide the required
      functionality, revenue from these arrangements is recognized in accordance
      Statement of Position (SOP) 81-1, “Accounting for Certain Construction Type and
      Certain Production Type Contracts, using either the percentage-of-completion
      method or the completed contract method. The percentage-of-completion method
      is
      used when the required services are quantifiable, based on the estimated number
      of labor hours necessary to complete the project, and under that method revenues
      are recognized using labor hours incurred as the measure of progress towards
      completion but is limited to revenue that has been earned by the attainment
      of
      any milestones included in the contract. The completed contract method is used
      when the required services are not quantifiable, and under that method revenues
      are recognized only when we have satisfied all of our product and/or service
      delivery obligations to the customer.




Security
      Systems - Security systems revenue consists of fees generated from consulting,
      audit, review, planning, engineering and design, supply of hardware systems
      installation and project management. Revenue from contracts where performance
      extends beyond one or more accounting periods is recognized in accordance with
      SOP 81-1, SEC Staff Accounting Bulletin 104, “Update of Codification of Staff
      Accounting Bulletins” and EITF 00-21, “Revenue Arrangements with Multiple
      Deliverables”. The recognition of revenue reflects the degree of completeness
      based upon project drawings, project schedules, progress of actual installation
      and are further validated by visual observations by product managers, quality
      inspectors and construction advisors, if applicable. When the current estimated
      costs to complete indicate a loss, such losses are immediately recognized for
      accounting purposes. Some projects have the equipment and installation as
      separate elements specified in the contracts. The revenue is recognized when
      each element has been satisfied in accordance with SOP81-1 and SEC Staff
      Accounting Bulletin 104, which are the delivery of the equipment and completion
      of installation process. The fair value of each element was based on the price
      charged when it is sold on a standalone basis.




For
      contracts of shorter duration, revenue is generally recognized when services
      are
      performed. Contractual terms may include the following payment arrangements:
      fixed fee, full-time equivalent, milestone, and time and material. In order
      to
      recognize revenue, the following criteria must be met:




·
            Signed
                agreement — The agreement must be signed by the
                customer.




·
            Fixed
                Fee — The signed agreement must specify the fees to be received for the
                services.




·
            Delivery
                has occurred — Delivery is substantiated by time cards and where
                applicable, supplemented by an acceptance from the customer that
                milestones as agreed in the statement have been
                met.




·
            Collectibility
                is probable — The Company conducts a credit review for significant
                transactions at the time of the engagement to determine the
                credit-worthiness of the customer. Collections are monitored over
                the term
                of each project, and if a customer becomes delinquent, the revenue
                may be
                deferred.




Service
      Revenue




Service
      revenue consists of fees generated by providing monitoring services, preventive
      maintenance and technical support, product maintenance and upgrades and regional
      broadband and cable service. Monitoring services and preventive maintenance
      and
      technical support are generally provided under contracts for terms varying
      from
      one to six years. A customer typically prepays monitoring services and
      preventive maintenance and technical support fees for an initial period, and
      the
      related revenue is deferred and generally recognized over the term of such
      initial period. Rates for product maintenance and upgrades are generally
      provided under time and material contracts. Revenue for these services is
      recognized in the period in which the services are provided.




**Warranty**




The
      Company carries a reserve based upon historical warranty claims experience.
      Additionally, warranty accruals are established on the basis of anticipated
      future expenditures as specific warranty obligations are identified and they
      are
      charged against the accrual. Expenditures exceeding such accruals are expensed
      direct to cost of sales.




**Earning
      (loss) per share**




F-9




The
      Company applies SFAS No. 128, "Earnings Per Share". Basic earning (loss)
      per share (“EPS”) is computed using the weighted average number of common shares
      outstanding during the period. Diluted EPS is computed using the weighted
      average number of common and dilutive potential common shares outstanding during
      the period. Dilutive potential common shares consist of common stock issuable
      upon exercise of stock options and warrants and conversion of debt using the
      treasury stock method. Adjustments to earnings per share calculation include
      reversing interest related to the convertible debts and changes in derivative
      instruments.




**Financial
      Instruments**




The
      carrying value of the Company’s financial instruments, including cash and cash
      equivalents, accounts receivable, note receivable, accounts payable and accrued
      liabilities approximate fair value because of the short maturities of those
      instruments. Based on borrowing rates currently available to the Company for
      loans with similar terms, the carrying value of term notes convertible notes
      and
      notes payable are also approximate fair value except notes payable due to The
      Burns Trust and the Navaratnam Trust and related party balances for which the
      fair value is not determinable.




We
      review
      the terms of convertible debt and equity instruments we issue to determine
      whether there are embedded derivative instruments, including the embedded
      conversion option, that are required to be bifurcated and accounted for
      separately as a derivative financial instrument. Generally, where the ability
      to
      physical or net-share settle the conversion option is deemed to be not within
      the control of the company, the embedded conversion option is required to be
      bifurcated and accounted for as a derivative financial instrument
      liability.




In
      connection with the sale of convertible debt and equity instruments, we may
      also
      issue freestanding options or warrants. Additionally, we may issue options
      or
      warrants to non-employees in connection with consulting or other services they
      provide. Although the terms of the options and warrants may not provide for
      net-cash settlement, in certain circumstances, physical or net-share settlement
      is deemed to not be within the control of the company and, accordingly, we
      are
      required to account for these freestanding options and warrants as derivative
      financial instrument liabilities, rather than as equity.




Derivative
      financial instruments are initially measured at their fair value. For derivative
      financial instruments that are accounted for as liabilities, the derivative
      instrument is initially recorded at its fair value and is then re-valued at
      each
      reporting date, with changes in the fair value reported as charges or credits
      to
      income. For option-based derivative financial instruments, we use the
      Black-Scholes option pricing model to value the derivative
      instruments.




Any
      discount from the face value of the convertible debt instrument resulting from
      the allocation of part of the proceeds to embedded derivative instruments and/or
      freestanding options or warrants is amortized over the life of the instrument
      through periodic charges to income, using the effective interest method.




**Credit
      Risk**




The
      Company’s financial assets that are exposed to credit risk consist primarily of
      cash and equivalents and accounts receivable. Concentrations of credit risk
      with
      respect to accounts receivable are limited due to the generally short payment
      terms.




**Foreign
      Currency Translation**




The
      Company maintains its accounts in United States dollars and in Canadian dollars
      for Canadian-based subsidiaries. The financial statements have been translated
      into United States dollars in accordance with SFAS. No. 52, Foreign Currency
      Translation.




All
      balance sheet accounts have been translated using the exchange rates in effect
      at the balance sheet date. Statement of operations amounts has been translated
      using the average exchange rate for the year. The gains and losses resulting
      from the changes in exchange rates from year to year have been reported
      separately as a component of comprehensive income. The gain and losses resulting
      from any inter-company balances with different functional currencies would
      be
      recognized in statement of operations.




**Income
      Taxes**




The
      Company accounts for income taxes using the asset and liability approach in
      accordance with SFAS No. 109, Accounting for Income Taxes. The asset and
      liability approach requires the recognition of deferred tax liabilities and
      assets for the expected future tax consequences of temporary differences between
      the carrying amounts and the tax basis of assets and liabilities. A valuation
      allowance is provided when it is more likely than not that some portion or
      all
      of the deferred tax assets will not be realized.




F-10




The
      provision for income taxes consists of an amount for the taxes currently payable
      and a provision for the tax consequences deferred to future
      periods.




**Comprehensive
      Income**




Comprehensive
      income equals net income plus other comprehensive income. Other comprehensive
      income refers to foreign currency translation adjustments.




**Accounting
      Estimates**




The
      Company prepares its financial statements in accordance with accounting
      principles generally accepted in the United States of America, which require
      management to make estimates and assumptions that affect the reported amounts
      of
      assets, liabilities, revenues and expenses and disclosure of contingent assets
      and liabilities. The estimates and assumptions used in the accompanying
      financial statements are based upon management’s evaluation of the relevant
      facts and circumstances as of the date of the financial statements. Actual
      results may differ from the estimates and assumptions used in preparing the
      accompanying financial statements.




**Recent
      Accounting Pronouncements**




SFAS
      155
      - ‘Accounting for Certain Hybrid Financial Instruments—an amendment of FASB
      Statements No. 133 and 140’




This
      Statement, issued in February 2006, amends FASB Statements No. 133, Accounting
      for Derivative Instruments and Hedging Activities, and No. 140, Accounting
      for
      Transfers and Servicing of Financial Assets and Extinguishments of Liabilities.
      This Statement resolves issues addressed in Statement 133 Implementation Issue
      No. D1, “Application of Statement 133 to Beneficial Interests in Securitized
      Financial Assets.”




This
      Statement:




a.
            Permits fair value remeasurement for
              any
              hybrid financial instrument that contains an embedded derivative that
              otherwise would require bifurcation.b.
            Clarifies which interest-only strips
              and
              principal-only strips are not subject to the requirements of Statement
              133.c.
            Establishes a requirement to evaluate
              interests in securitized financial assets to identify interests that
              are
              freestanding derivatives or that are hybrid financial instruments that
              contain an embedded derivative requiring bifurcation.d.
            Clarifies that concentrations of credit
              risk
              in the form of subordination are not embedded derivatives.e.
            Amends Statement 140 to eliminate the
              prohibition on a qualifying special-purpose entity from holding a
              derivative financial instrument that pertains to a beneficial interest
              other than another derivative financial
              instrument.




This
      Statement is effective for all financial instruments acquired or issued after
      the beginning of our first fiscal year that begins after September 15,
      2006.




The
      fair
      value election provided for in paragraph 4(c) of this Statement may also be
      applied upon adoption of this Statement for hybrid financial instruments that
      had been bifurcated under paragraph 12 of Statement 133 prior to the adoption
      of
      this Statement. Earlier adoption is permitted as of the beginning of our fiscal
      year, provided we have not yet issued financial statements, including financial
      statements for any interim period, for that fiscal year. Provisions of this
      Statement may be applied to instruments that we hold at the date of adoption
      on
      an instrument-by-instrument basis.




F-11




The
      Company is currently reviewing the effects of adoption of this statement but
      it
      is not expected to have a material impact on our financial
      statements.




SFAS
      156
      - ‘Accounting for Servicing of Financial Assets—an amendment of FASB Statement
      No. 140’




This
      Statement, issued in September 2006, amends FASB Statement No. 140, Accounting
      for Transfers and Servicing of Financial Assets and Extinguishments of
      Liabilities, with respect to the accounting for separately recognized servicing
      assets and servicing liabilities. This Statement:


1.
              Requires
                  an entity to recognize a servicing asset or servicing liability
                  each time
                  it undertakes an obligation to service a financial asset by entering
                  into
                  a servicing contract in certain situations.2.
              Requires
                  all separately recognized servicing assets and servicing liabilities
                  to be
                  initially measured at fair value, if practicable.3.
              Permits
                  an entity to choose either the amortization method or the fair
                  value
                  measurement method for each class of separately recognized servicing
                  assets and servicing liabilities.4.
              At
                  its initial adoption, permits a one-time reclassification of
                  available-for-sale securities to trading securities by entities
                  with
                  recognized servicing rights, without calling into question the
                  treatment
                  of other available-for-sale securities under Statement 115, provided
                  that
                  the available-for-sale securities are identified in some manner
                  as
                  offsetting the entity’s exposure to changes in fair value of servicing
                  assets or servicing liabilities that a service elects to subsequently
                  measure at fair value.5.
              Requires
                  separate presentation of servicing assets and servicing liabilities
                  subsequently measured at fair value in the statement of financial
                  position
                  and additional disclosures for all separately recognized servicing
                  assets
                  and servicing liabilities.






Adoption
      of this Statement is required as of the beginning of the first fiscal year
      that
      begins after September 15, 2006. The adoption of this statement is not expected
      to have a material impact on our financial statements.


SFAS
      157
      - ‘Fair Value Measurements’





In
      September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements”. This
      standard establishes a standard definition for fair value, establishes a
      framework under generally accepted accounting principles for measuring fair
      value and expands disclosure requirements for fair value measurements. This
      standard is effective for financial statements issued for fiscal years beginning
      after November 15, 2007. Adoption
      of this statement is not expected to have any material effect on our financial
      position or results of operations .




SFAS
      158
      - ‘ Employers’
      Accounting for Defined Benefit Pension and Other Postretirement Plans, an
      amendment of FASB Statement Nos. 87, 88, 106, and 132(R) ’





In
      September 2006, the FASB issued Financial Accounting Standard No. 158,
      ' *Employers’
      Accounting for Defined Benefit Pension and Other Postretirement Plans, an
      amendment of FASB Statement Nos. 87, 88, 106, and 132(R)'* ,
      or SFAS
      158. This Statement requires an employer that is a business entity and sponsors
      one or more single-employer defined benefit plans to (a) recognize the funded
      status of a benefit plan—measured as the difference between plan assets at fair
      value (with limited exceptions) and the benefit obligation—in its statement of
      financial position; (b) recognize, as a component of other comprehensive income,
      net of tax, the gains or losses and prior service costs or credits that arise
      during the period but are not recognized as components of net periodic benefit
      cost pursuant to FAS 87, *Employers’
      Accounting for Pensions* ,
      or FAS
      106, *Employers’
      Accounting for Postretirement Benefits Other Than Pensions* ;
      (c)
      measure defined benefit plan assets and obligations as of the date of the
      employer’s fiscal year-end statement of financial position (with limited
      exceptions); and (d) disclose in the notes to financial statements additional
      information about certain effects on net periodic benefit cost for the next
      fiscal year that arise from delayed recognition of the gains or losses, prior
      service costs or credits, and transition assets or obligations. An employer
      with
      publicly traded equity securities is required to initially recognize the funded
      status of a defined benefit postretirement plan and to provide the required
      disclosures as of the end of the fiscal year ending after December 15, 2006.
      This statement is not expected to have a significant effect on our financial
      statements.




F-12




SFAS
      159
      - ‘The Fair Value Option for Financial Assets and Financial
      Liabilities—Including an amendment of FASB Statement No. 115’


In
      February 2007, the FASB issued **** Financial
      Accounting Standard No. 159 ' *The
      Fair Value Option for Financial Assets and Financial Liabilities—Including an
      amendment of FASB Statement No. 115'* or SFAS
      159. This Statement permits entities to choose to measure many financial
      instruments and certain other items at fair value. Most of the provisions of
      this Statement apply only to entities that elect the fair value option.




The
      following are eligible items for the measurement option established by this
      Statement:




1.
      Recognized financial assets and financial liabilities except:




a.
            An
                investment in a subsidiary that the entity is required to
                consolidate




b.
            An
                interest in a variable interest entity that the entity is required
                to
                consolidate




c.
            Employers’
                and plans’ obligations (or assets representing net overfunded positions)
                for pension benefits, other postretirement benefits (including health
                care
                and life insurance benefits), post employment benefits, employee
                stock
                option and stock purchase plans, and other forms of deferred compensation
                arrangements.




d.
            Financial
                assets and financial liabilities recognized under leases as defined
                in
                FASB Statement No. 13, '*Accounting
                for Leases.'*




e.
            Deposit
                liabilities, withdrawable on demand, of banks, savings and loan
                associations, credit unions, and other similar depository
                institutions




f.
            Financial
                instruments that are, in whole or in part, classified by the issuer
                as a
                component of shareholder’s equity (including “temporary equity”). An
                example is a convertible debt security with a noncontingent beneficial
                conversion feature.




2.
      Firm
      commitments that would otherwise not be recognized at inception and that involve
      only financial instruments




3.
      Nonfinancial insurance contracts and warranties that the insurer can settle
      by
      paying a third party to provide those goods or services




4.
      Host
      financial instruments resulting from separation of an embedded nonfinancial
      derivative instrument from a nonfinancial hybrid instrument.




The
      fair
      value option:




1.
      May be
      applied instrument by instrument, with a few exceptions, such as investments
      otherwise accounted for by the equity method




2.
      Is
      irrevocable (unless a new election date occurs)




3.
      Is
      applied only to entire instruments and not to portions of
      instruments.




The
      Statement is effective as of the beginning of an entity’s first fiscal year that
      begins after November 15, 2007. Early adoption is permitted as of the beginning
      of a fiscal year that begins on or before November 15, 2007, provided the entity
      also elects to apply the provisions of FASB Statement No. 157, ' *Fair
      Value Measurements'* .
      We have
      not yet determined what effect, if any, adoption of this Statement will have
      on
      our financial position or results of operations .




F-13




SAB
      108 -
‘Considering the Effects of Prior Year Misstatements when Quantifying
      Misstatements in Current Year Financial Statements’




In
      September 2006, the SEC issued Staff Accounting Bulletin No. 108 (SAB 108),
      'Considering the Effects of Prior Year Misstatements when Quantifying
      Misstatements in Current Year Financial Statements.' SAB 108 provides guidance
      on the consideration of the effects of prior year unadjusted errors in
      quantifying current year misstatements for the purpose of a materiality
      assessment. Adoption
      of this statement is not expected to have any material effect on our financial
      position or results of operations .




FIN
      48 -
‘Accounting for Uncertainty in Income Taxes’




In
      June
      2006, the FASB issued Interpretation No. 48 (“FIN 48”), “Accounting for
      Uncertainty in Income Taxes”, an interpretation of SFAS No. 109. FIN 48
      prescribes a comprehensive model for how companies should recognize, measure,
      present and disclose uncertain tax positions taken or expected to be taken
      on a
      tax return. Under FIN 48, we shall initially recognize tax positions in the
      financial statements when it is more likely than not the position will be
      sustained upon examination by the tax authorities. We shall initially and
      subsequently measure such tax positions as the largest amount of tax benefit
      that is greater than 50% likely of being realized upon ultimate settlement
      with
      the tax authority assuming full knowledge of the position and all relevant
      facts. FIN 48 also revises disclosure requirements to include an annual tabular
      roll-forward of unrecognized tax benefits. We will adopt this interpretation
      as
      required in 2007 and will apply its provisions to all tax positions upon initial
      adoption with any cumulative effect adjustment recognized as an adjustment
      to
      retained earnings. Adoption
      of this statement is not expected to have any material effect on our financial
      position or results of operations.




EITF
      00-19-2, "Accounting for Registration Payment Arrangements".




In
      December 2006, the FASB issued Staff Position FSP EITF 00-19-2, "Accounting
      for
      Registration Payment Arrangements". This statement is effective for existing
      registration payment arrangements as of January 1, 2007, with earlier
      application permitted in previously-unissued financial statements. As discussed
      in Note 9 and as permitted by the FSP, we adopted the provisions of this
      FSP in our fourth quarter of 2006, resulting in re-classification of certain
      of
      our outstanding warrants from derivative instrument liabilities to
      equity.


**2.**
              **Acquisition**


In
      January 2006, the Company entered into an agreement, through its wholly owned
      newly formed Delaware subsidiary, Cancable Holding Corp. (“Cancable Holding”),
      to acquire all of the issued and outstanding shares of capital stock and any
      other equity interests of Cancable Inc., an Ontario corporation (“Cancable”). To
      finance the acquisition, subsidiaries of the Company entered into a loan
      agreement with Laurus Master Fund, Ltd., a Cayman Islands Company, to which
      the
      Company became a guarantor.




The
      Company, Cancable, Cancable Holding, Covington Capital Corporation (“Covington”)
      and BMO Capital Corporation (“BMO”) entered into a Stock Purchase Agreement for
      the purchase by Cancable Holding of all the issued and outstanding shares of
      capital stock and any other equity interests of Cancable.




Cancable
      and Cancable Holding entered into a series of agreements with Laurus whereby
      Cancable issued to Laurus a secured term note (the “Cancable Note”) in the
      amount of $6,865,000 and Cancable Holding issued to Laurus a related option
      to
      purchase up to 49 shares of common stock of Cancable Holding (up to 49% of
      the
      outstanding shares of Holding) at a price of $0.01 per share (the “Option”). The
      Cancable Note is secured by all of the assets of the Company and its
      subsidiaries. The principal amount of the Cancable Note bears interest at prime
      rate plus one and three quarters percent with a minimum rate of seven percent.
      Cancable and Cancable Holding have granted Laurus a right of first refusal
      with
      respect to any debt or equity financings for a period of 180 days after
      closing.




F-14




In
      February 2006, the Company and its subsidiaries, Iview Holding Corp., a newly
      formed Delaware corporation and direct subsidiary of the Company (“Iview
      Holding”), and Iview Digital Video Solutions Inc. (“Iview DSI”), entered into a
      series of agreements with Laurus pursuant to a refinancing transaction whereby
      the Company issued to Laurus a secured term note (the “Company Note”) in the
      amount of $8,250,000, Iview DSI issued to Laurus a secured term note (the “Iview
      Note”) in the amount of $2,000,000, the Company issued to Laurus a related
      warrant to purchase up to 2,411,003 shares of common stock of the Company (up
      to
      7.5% of the outstanding shares of the Company) at a price of $0.01 per share
      (the “Warrant”) and Holding issued to Laurus a related option to purchase up to
      20 shares of common stock of Holding (up to 20% of the outstanding shares of
      Holding) at a price of $0.01 per share (the “Option”). The loans are secured by
      all of the assets of the Company and its subsidiaries.




Simultaneously
      with the closing of this refinancing transaction, the Company paid off the
      entire outstanding principal amount and all obligations due to Laurus under
      the
      Secured Convertible Term Note dated September 30, 2004, the Secured Convertible
      Minimum Borrowing Note dated September 30, 2004, and the Secured Revolving
      Note
      dated September 30, 2004, (collectively, the “2004 Notes”) and such 2004 Notes
      were subsequently cancelled.




The
      principal amounts of the Company Note and the Iview Note bear interest at the
      prime rate plus two percent with a minimum rate of seven percent.




The
      Company, Iview Holding and Iview DSI have granted Laurus a right of first
      refusal with respect to any debt or equity financings for a period of 180 days
      after closing.




The
      Transaction described in above relating to the acquisition of Cancable was
      accounted for as a business combination in accordance with SFAS No. 141.
      Goodwill and intangible asets were measured as fair value after the purchase
      price net off the fair value of tangible assets. A summary of the Transaction
      is
      presented below:




Fair
      value of net tangible assets acquired




Common
                stock issued
            
            $
            -Options
                to purchase common stock
            
            
            -Transaction
                costs
            
            
            260,023Equity
                purchase price
            
            
            260,023Assumed
                debt and capital lease obligations
            
            
            7,785,450Equity
                purchase price
            
            
            8,045,473Fair
                value of net tangible assetsCash
                and bank balances
            
            $
            1,226,756Accounts
                receivable
            
            
            1,420,863Inventory
                and supplies
            
            
            217,760Prepaid
                expenses
            
            
            225,485Other
                current assets
            
            
            6,766Property
                and equipment
            
            
            2,017,273Aggregate
                tangible assets
            
            
            5,114,903Accounts
                payable and accrued liabilities
            
            
            (1,962,109
            )Other
                liabilities
            
            
            (201,166
            )2,951,628Intangible
                assets
            
            
            2,200,000Goodwill
            
            $
            2,893,845





The
      unaudited results of operations of Cancable have been included in the results
      of
      operations of the Company for the entire year ended December 31, 2006, had
      the
      acquisition of Cancable taken place on January 1, 2005, the consolidated
      unaudited results of operations would have been as follows:




Revenue
            
            $
            25,449,083Net
                income
            
            $
            215,334Net
                income per share
            
            $
            0.01





F-15


**3.**
              **Prepaid
                  Expenses**




The
        balance consists of the following:


**2006**
            
            
            **2005**Prepaid
                insurance
            
            $
            149,949
            
            $
            -Prepaid
                rent
            
            
            38,160
            
            
            -Prepaid
                leases
            
            
            20,554
            
            
            -Others
            
            
            28,625
            
            
            6,353Consulting
                and professional fees
            
            
            **-**
            
            
            25,000$
            237,288
            
            $
            31,353


**4.**
              **Related
                  Party Transactions**




Balances
      due to related parties are as follows:




**2006**
            
            **2005**Balance
              due from a company controlled by the president, non-interest bearing
              and
              due on demand
            
            $
            2,203
            
            $
            2,203Balances
                due to related parties are as follows:Advances
                from the Chief Executive Officer (CEO) of the Company, non-interest
                bearing with no fixed terms of repayment. The loan is subordinated
                to the
                Laurus loan
            
            
            58,693
            
            
            58,693Subordinated
                loan - advances from the CEO and is secured by a promissory note,
                a third
                ranking general security agreement, assignment of insurance policy,
                a
                second mortgage on the industrial condominium up to $269,955, personal
                guarantee of the president and his spouse up to $539,910 and a collateral
                second mortgage on the president's principal residence up to $77,130,
                bearing interest at 6% per annum, repayable in blended monthly payments
                of
                $10,155. The loan matured on February 14, 2005. However, the loan
                is
                subordinated to Laurus with no fixed terms of repayment and no interest
                will be charged from September 30, 2004. Total interest for the year
                was
                $Nil (2004: $4,328).
            
            
            55,919
            
            
            55,919Loan
                payable to a company controlled by the president's spouse, non-interest
                bearing and due on demand
            
            
            2,501
            
            
            903Loan
                payable to the president of the Company, non-interest bearing with
                no
                fixed terms of repayment. The loan is subordinated to
                Laurus
            
            
            84,413
            
            
            84,413201,526
            
            
            199,928Less
                current portion
            
            
            2,501
            
            
            903$
            199,025
            
            $
            199,025Note
                payable to related parties are as follows:Note
                payable to the Malar Trust (the CEO is one of the beneficiaries of
                the
                trust), bearing interest at 3% per annum with no fixed terms of repayment.
                The loan is subordinated to the Laurus loan. Total interest for the
                year
                was $48,091 (2005: $45,000)
            
            $
            1,500,000
            
            $
            -Note
                payable to the Navaratnam Trust (the CEO is one of the beneficiaries
                of
                the trust), bearing interest at 3% per annum with no fixed terms
                of
                repayment. The loan is subordinated to the Laurus loan. Total interest
                for
                the year was $Nil (2005: $22,500)
            
            
            -
            
            
            750,000Note
                payable to the Burns Trust (the president is one of the beneficiaries
                of
                the trust), bearing interest at 3% per annum with no fixed terms
                of
                repayment. The loan is subordinated to the Laurus loan Total interest
                for
                the year was $Nil (2005: $22,500)
            
            
            -
            
            
            750,000$
            1,500,000
            
            $
            1,500,000





F-16




During
      the year, $202,500 (2005 - $250,000) in consulting fees were paid to the
      Companies controlled by the CEO. In addition, $188,700 (2005 - $126,000) in
      consulting fees was paid to the Company controlled by the president’s
      spouse.




In
      September 2004, the Company issued two promissory notes with an aggregate
      principal amount of $3,300,000. On September 30, 2004, the Company repaid
      an aggregate of $1,800,000 of the principal balance. The outstanding principal
      bears interest at 3% per annum with no fixed terms of repayment and payable
      on
      demand. However, pursuant to the Laurus Financing, these notes have been
      subordinated to the Company’s obligations to Laurus. The notes each with an
      amount of $750,000 are due to The Burns Trust (the president is one of the
      beneficiaries of the trust) and the Navaratnam Trust (the CEO is one of the
      beneficiaries of the trust), respectively. During the period ended June 30,
      2006, the above two notes payable have been transferred to Malar Trust Inc.
      (the
      Company’s CEO is the shareholder of Malar Trust Inc.).




**5.**
            **Property
                and Equipment**




**2006**
            
            
            
            **2005****Accumulated**
            
            
            
            **Accumulated****Cost**
            
            **Depreciation**
            
            **Cost**
            
            **Depreciation**Land
            
            $
            85,565
            
            
            **-**
            
            $
            85,565
            
            
            -Industrial
                condominium
            
            
            737,926
            
            
            122,775
            
            
            737,926
            
            
            99,761Leasehold
                improvement
            
            
            98,980
            
            
            14,426
            
            
            -
            
            
            -Office
                equipment
            
            
            264,307
            
            
            88,157
            
            
            68,969
            
            
            37,345Office
                equipment under capital leases
            
            
            42,505
            
            
            15,349
            
            
            -
            
            
            -Furniture
                and fixtures
            
            
            112,057
            
            
            80,682
            
            
            55,478
            
            
            30,512Furniture
                and fixtures under capital leases
            
            
            19,235
            
            
            19,235
            
            
            -
            
            
            -Computer
                hardware and software
            
            
            775,332
            
            
            493,260
            
            
            83,509
            
            
            58,922Computer
                hardware and software under capital leases
            
            
            106,049
            
            
            84,242
            
            
            -
            
            
            -Office
                equipmentVehicles
            
            
            134,554
            
            
            111,914
            
            
            -
            
            
            -Vehicles
                under capital leases
            
            
            2,643,899
            
            
            432,914
            
            
            -
            
            
            -Tools
                & Equipment
            
            
            711,729
            
            
            444,629
            
            
            -
            
            
            -$
            **5,732,138**
            
            $
            **1,907,583**
            
            $
            **1,031,447**
            
            $
            **226,540**Net
                book value
            
            
            
            
            $
            **3,824,555**
            
            
            
            
            $
            **804,907**




F-17


**6.**
              **Intangible
                  Assets**




**Cost**
            
            **Accumulated
                amortization**
            
            **Net
                book**
              **value**Customer
                relationships
            
            $
            1,000,000
            
            
            200,000
            
            
            800,000Trade
                name
            
            
            1,200,000
            
            
            400,000
            
            
            800,0002,200,000
            
            
            600,000
            
            
            1,600,000


**7.**
              **Deferred
                  Financing Costs,
                  Net**




Deferred
      financing costs are associated with the Company’s term notes from Laurus Master
      Fund, Ltd., a Cayman Islands company. The balance carried forwarded from
      December 31, 2005 was written off in the amount of $600,479 as the entire
      revolving notes and convertible notes issued on September 30, 2004 were repaid.
      For the year ended December 31, 2006, the amortization of deferred financing
      cost was approximately $182,402 (2005 - $450,507).




**2006**
            
            **2005**Cost
            
            $
            829,944
            
            $
            1,176,365Accumulated
                amortization
            
            
            182,402
            
            
            575,886$
            647,542
            
            $
            600,479




The
                estimated amortization expense for each of the next five fiscal years
                and
                thereafter is as follows:




**Year**
            
            **Amount**2007
            
            $
            173,1232008
            
            
            148,4352009
            
            
            120,8012010
            
            
            113,1802011
            
            
            92,003$
            647,542


**8.**
              **Revolving
                  Credit Facilities**




The
      Company had a $3,000,000 secured revolving line of credit, including a secured
      convertible minimum borrowing note in the amount of $1,000,000, with
      Laurus. The
      entire revolving line of credit was repaid during the period ended March 31,
      2006 through a refinancing transaction in February 2006 (see Note
      10).


**9.**
              **Convertible
                  Notes**




F-18


**(a)
      Private Placement - Laurus Master Fund, Ltd.**




On
      September 30, 2004, the Company entered into a series of agreements with Laurus
      pursuant to which the Company issued a Secured Convertible Term Note in the
      principal amount of $4,500,000 due September 30, 2007, a Secured Revolving
      Note
      and Secured Convertible Minimum Borrowing Note of up to a maximum aggregate
      amount of $2,000,000 and $1,000,000 due September 30, 2007, a common stock
      purchase warrant and a stock purchase option.




During
      the period ended December 31, 2005, a total of 1,000,000 warrants were issued
      in
      exchange for the postponement by Laurus of scheduled principal payments under
      the Term Note. In accordance with EITF 96-19 the Company reviewed the effect
      of
      these changes to the Laurus term note and concluded they should be accounted
      for
      as a modification of terms. Accordingly, the initial fair value of the warrants
      was being recognized as additional interest expense over the remaining term
      of
      the notes using the effective interest method.




Revolving
      credit facilities as at December 31, 2005 was as follows:




2005Borrowing
                under revolving line of credit
            
            $
            2,670,666Less:
                Unamortized discount on notes, related to convertible options, common
                stock options and warrants
            
            
            (802,238
            )1,868,428Add:
                Bifurcated embedded compound instrument
            
            
            260,007$
            2,128,435


Convertible
      notes as at December 31, 2005 was as follows:




20057%
                convertible term note due to Laurus, collateralized by all assets
                of the
                Company with interest at Prime plus 2%
            
            $
            4,500,000Less:
                Unamortized discount on notes, related to common stock options and
                warrants
            
            
            (3,233,501
            )1,266,499Add:
                Bifurcated embedded compound instrument
            
            
            1,005,000$
            2,271,499




F-19


The
      above
      Notes were repaid during the period ended March 31, 2006 through a refinancing
      transaction (see Note 10).




**(b)
      Derivative Financial Instruments**




We
      have
      issued to Laurus warrants to purchase up to 5,974,003 shares of our common
      stock
      and options to purchase up to 1,499,997 shares of our common stock, at exercise
      prices of $1.15 to $0.01 per share, with terms of seven to ten years. During
      the
      quarter ended September 30, 2005, Laurus exercised 1,200,000
      options.




Because
      these warrants and options were subject to a registration payment arrangement,
      they were classified as derivative instrument liabilities and recorded at their
      fair value.. We compute their fair values using a Black-Scholes model with
      an
      interest rate of 3.5% to 4.33%, volatility from 45% to 55%, expected dividend
      yield of 0%, share price of $0.34 to $1.07 and expected terms of seven to ten
      years, as appropriate. The aggregate fair value of the outstanding warrants
      and
      options at the time they were issued was $4,121,871 and at September 30, 2006
      was $577,703.




In
      December 2006, the FASB issued FASB Staff Position EITF 00-19-2 “Accounting for
      Registration Payment Arrangements” (FSP EITF 00-19-2). That Staff Position
      specifies that the contingent obligation to make future payments or otherwise
      transfer consideration under a registration payment arrangement should be
      separately recognized and measured in accordance with FASB Statement No. 5
      “Accounting For Contingencies”. FSP EITF 00-19-2 further clarifies that a
      financial instrument subject to a registration payment arrangement should be
      accounted for in accordance with other applicable generally accepted accounting
      principles without regard to the contingent obligation to transfer consideration
      pursuant to the registration payment arrangement.




As
      permitted by FSP EITF 00-19-2, we have adopted the provisions of this FSP in
      our
      interim period beginning October 1, 2006. Retrospective application of the
      guidance in this FSP to financial statements for earlier interim or annual
      periods is not permitted. Accordingly, as of October 1, 2006, the warrants
      and
      options are no longer classified as derivative instrument liabilities and their
      fair values as of October 1, 2006 of $577,703 have been transferred to equity,
      with corresponding adjustments to additional paid-in capital and retained
      earnings to reflect previous charges to income for changes in the fair values
      of
      the instruments since they were issued.





Laurus
      has agreed to terminate all registration rights they held related to our
      agreements with them and, accordingly, we no longer have any potential
      registration payment obligations.




At
      December 31, 2006, the following common stock options and warrants issued to
      Laurus in connection with financing were outstanding. As discussed above, as
      of
      October 1, 2006, these options and warrants are no longer accounted for as
      derivative instrument liabilities and their fair values at that date were
      transferred to equity.




**Issue
                Date**
            
            **Expiry
                Date**
            
            **Number
                of**
              **options
                or**
              **warrants**
            
            **Exercise**
              **Price
                Per Share**
            
            **Value
                -**
              **issue
                date**
            
            **Value
                -**
              **September
                30,**
              **2006**09-30-2004
            
            
            09-30-2014
            
            
            **299,997
            
            $
            0.01
            
            $
            319,101
            
            $
            58,55109-30-2004
            
            
            09-30-2011
            
            
            2,250,000
            
            
            1.15
            
            
            1,370,000
            
            
            25,15403-31-2005
            
            
            03-31-2012
            
            
            100,000
            
            
            1.20
            
            
            60,291
            
            
            1,32504-30-2005
            
            
            04-30-2012
            
            
            100,000
            
            
            1.01
            
            
            44,309
            
            
            1,80305-31-2005
            
            
            05-31-2012
            
            
            100,000
            
            
            1.01
            
            
            56,614
            
            
            1,86406-22-2005
            
            
            06-22-2012
            
            
            313,000
            
            
            1.00
            
            
            137,703
            
            
            6,05506-30-2005
            
            
            06-30-2012
            
            
            100,000
            
            
            0.90
            
            
            50,431
            
            
            2,23707-31-2005
            
            
            07-31-2012
            
            
            100,000
            
            
            1.05
            
            
            56,244
            
            
            1,87208-31-2005
            
            
            08-31-2012
            
            
            100,000
            
            
            1.05
            
            
            22,979
            
            
            1,93209-30-2005
            
            
            09-30-2012
            
            
            100,000
            
            
            0.80
            
            
            36,599
            
            
            1,99010-31-2005
            
            
            10-31-2012
            
            
            100,000
            
            
            0.80
            
            
            27,367
            
            
            2,05011-30-2005
            
            
            11-30-2012
            
            
            100,000
            
            
            0.80
            
            
            16,392
            
            
            2,99412-31-2005
            
            
            12-31-2012
            
            
            100,000
            
            
            0.80
            
            
            10,270
            
            
            3,06002-13-2006
            
            
            02-13-2016
            
            
            2,411,003
            
            
            0.01
            
            
            1,913,571
            
            
            466,816$
            4,121,871
            
            $
            577,703





F-20


****10.****
              **Term
                    Notes**




In
      January 2006, concurrently with the closing of the acquisition of Cancable
      Inc.
      (see Note 2), the Company entered into a series of agreements with Laurus
      whereby Cancable issued to Laurus a secured term note (the “Cancable Note”) in
      the amount of $6,865,000 and Cancable Holding issued to Laurus a related option
      to purchase up to 49 shares of common stock of Cancable Holding (up to 49%
      of
      the outstanding shares of Cancable Holding) at a price of $0.01 per share (the
      “Option”). The loan is secured by all of the assets of the Company and its
      subsidiaries.




The
      Cancable Note bears interest at the prime rate plus 1.75% with a minimum rate
      of
      seven percent. Interest accrued on the term note but was not payable until
      February 1, 2006. Interest is calculated on the basis of a 360 day year. The
      minimum monthly payment on the term note is $81,726 commencing from October
      1,
      2006. The Company is not obligated, except upon an event of default, to pay
      more
      than 25% of the Principal Amount prior to December 31, 2011.




In
      February 2006, the Company and its subsidiaries, Iview Holding and Iview DSI
      entered into a series of agreements with Laurus pursuant to a refinancing
      transaction whereby the Company issued to Laurus a secured term note (the
“Company Note”) in the amount of $8,250,000, Iview DSI issued to Laurus a
      secured term note (the “Iview Note”) in the amount of $2,000,000, the Company
      issued to Laurus a related warrant to purchase up to 2,411,003 shares of common
      stock of the Company (up to 7.5% of the outstanding shares of the Company)
      at a
      price of $0.01 per share (the “Warrant”) and Iview Holding issued to Laurus a
      related option to purchase up to 20 shares of common stock of Holding (up to
      20%
      of the outstanding shares of Holding) at a price of $0.01 per share (the
“Option”). The loans are secured by all of the assets of the Company and its
      subsidiaries.




The
      Company Note bears interest at the prime rate plus 2% with a minimum rate of
      seven percent. Interest accrued on the term note but was not payable until
      April
      1, 2006. Interest is calculated on the basis of a 360 day year. The minimum
      monthly payment on the term note is $137,500 commencing March 1, 2007 to
      February 1, 2009. $1,600,000 is payable on the maturity date.




The
      Iview
      Note bears interest at the prime rate plus 2% with a minimum rate of seven
      percent. Interest accrued on the term note but was not payable until April
      1,
      2006. Interest is calculated on the basis of a 360 day year. The minimum monthly
      payment on the term note is $8,333 commencing March 1, 2007 to February 1,
      2011.
      $4,950,000 is payable on the maturity date. The Company is not obligated, except
      upon an event of default, to pay more than 25% of the Principal Amount prior
      to
      December 31, 2011.




Simultaneously
      with the closing of this refinancing transaction, the Company paid off the
      entire outstanding principal amount and all obligations due to Laurus under
      the
      Secured Convertible Term Note dated September 30, 2004 (also see Note 9), the
      Secured Convertible Minimum Borrowing Note dated September 30, 2004 and the
      Secured Revolving Note dated September 30, 2004 (collectively, the “2004 Notes”)
      (see Note 9) and such 2004 Notes were subsequently cancelled.




F-21




Interest
      on the term note for the nine months period ended December 31, 2006 was
      $1,587,222 (2005: $Nil).




**Amount**Cancable
                term note bears interest at prime plus 1.75% with the minimum interest
                rate 7% and due on December 31, 2011
            
            $
            6,619,822Company
                term note bears interest at prime plus 2% with the minimum interest
                rate
                7% and due on December 31, 2011
            
            
            8,250,000Iview
                term note bears interest at prime plus 2% with the minimum interest
                rate
                7% and due on December 31, 2011
            
            
            2,000,00016,869,822Less:
                current portion
            
            
            2,439,046$
            14,430,776





**The
      principal payments for the next five years are as follows:**




Amount2007
            
            $
            2,439,0462008
            
            
            2,240,3562009
            
            
            375,0002010
            
            
            5,050,0002011
            
            
            6,765,420$
            16,869,822




**11.**
              **Net
                  Financing Expenses**


**December
                31, 2006**
            
            December
                31, 2005**Capital
                leases**
            
            $
            254,005
            
            $
            -**Interest
                of credit facility**
            
            
            1,683,900
            
            
            2,260,617**Amortization
                of interest on debt instruments**
            
            
            168,171
            
            
            -**Interest
                and penalties on prepayment of convertible notes -
                cash**
            
            
            539,319
            
            
            -**Interest
                and penalties on prepayment of convertible notes - 2,411,003
                warrants**
            
            
            1,913,571
            
            
            -**Others**
            
            
            58,859
            
            
            46,653$
            4,617,825
            
            $
            2,307,270




**12.**
              **Other
                  Notes Payable**


In
      February 2004, the Company issued four promissory notes each with principal
      amounts of $39,632 and payable at 100% of the face or principal amount in the
      denomination of CAD $50,000. The notes mature on February 26, 2007. Interest
      is
      payable monthly and accrues at the rate of 10.5% per annum on the outstanding
      principal amount on the 26 th day of
      each month. The principal amount of the notes is repayable in twelve consecutive
      monthly payments commencing on March 26, 2006. The balance of the notes was
      $28,736 at December 31, 2006. The entire outstanding balance was settled in
      February, 2007.




Interest
      expense recognized for the period was $10,768 (2005 - $57,898).




**13**.****
              **Obligation
                  Under Capital Leases**
  F-22





**2006**
              
              **2005**Obligation
                  under capital lease - 10%, due April 2008, repayable $382 principal
                  and
                  interest monthly, secured by certain office equipment
              
              **$**
              **7,023**
              
              $
              -Obligation
                  under capital lease - 11.7%, due May 2007, repayable $581 principal
                  and
                  interest monthly, secured by certain computer equipment
              
              
              **4,419**
              
              
              -Obligation
                  under capital lease - 10.9%, due July 2007, repayable $623 principal
                  and
                  interest monthly, secured by certain computer equipment
              
              
              **5,266**
              
              
              -Obligation
                  under capital lease -13.3%, due July 2007, repayable $347 principal
                  and
                  interest monthly, secured by certain computer equipment
              
              
              **2,835**
              
              
              -Obligation
                  under capital lease -11%, due June 2007, repayable $863 principal
                  and
                  interest monthly, secured by certain computer equipment
              
              
              **6,627**
              
              
              -Obligation
                  under capital lease -17%, due June 2007, repayable $1,305 principal
                  and
                  interest monthly, secured by certain computer equipment
              
              
              **9,206**
              
              
              -Obligation
                  under capital lease - 15.14%, due November 2011, repayable $399
                  principal
                  and interest monthly, secured by certain office equipment
              
              
              **14,136**
              
              
              -Obligation
                  under capital lease - 9.07%, due November 2011,repayable $517 principal and interest monthly, secured by certain
                  office
                  equipment
              
              
              **1,981**
              
              
              -Obligation
                  under capital lease - 8.87%, due July 2009, repayable $449 principal
                  and
                  interest monthly, secured by 21 vehicles
              
              
              **342,726**
              
              
              -Obligation
                  under capital lease - 8.67%, due August 2009, repayable $439 principal
                  and
                  interest monthly, secured by 14 vehicles
              
              
              **228,983**
              
              
              -Obligation
                  under capital lease - 8.67%, due September 2009, repayable $439
                  principal
                  and interest monthly, secured by 22 vehicles
              
              
              **366,412**
              
              
              -Obligation
                  under capital lease - 8.67%, due October 2009, repayable $439 principal
                  and interest monthly, secured by 5 vehicles
              
              
              **84,872**
              
              
              -Obligation
                  under capital lease - 10.88%, due June 2010, repayable $489 principal
                  and
                  interest monthly, secured by 7 vehicles
              
              
              **141,903**
              
              
              -Obligation
                  under capital lease - 10.88%, due July 2010, repayable $489 principal
                  and
                  interest monthly, secured by 20 vehicles
              
              
              **411,549**
              
              
              -Obligation
                  under capital lease - 10.88%, due August 2010, repayable $489 principal
                  and interest monthly, secured by 6 vehicles
              
              
              **125,295**
              
              
              -Obligation
                  under capital lease - 10.88%, due September 2009, repayable $493
                  principal
                  and interest monthly, secured by 7 vehicles
              
              
              **149,470**
              
              
              -Obligation
                  under capital lease - 8.88%, due November 2010, repayable $439
                  principal
                  and interest monthly, secured by 5 vehicles
              
              
              **111,969**
              
              
              **-**Obligation
                  under capital lease - 8.85%, due December 2010, repayable $439
                  principal
                  and interest monthly, secured by 7 vehicles
              
              
              **161,960**
              
              
              -Obligation
                  under capital lease - 9.30%, due January 2011, repayable $491 principal
                  and interest monthly, secured by 4 vehicles
              
              
              **92,964**
              
              
              -Obligation
                  under capital lease - 30.00%, due August 2007, repayable $357 principal
                  and interest monthly, secured by 82 vehicles
              
              
              **230,144**
              
              
              **-****2,499,740**
              
              
              -Less
                  amount due within one year included in current liabilities
              
              
              **710,375**
              
              
              -$
              **1,789,365**
              
              $
              -




F-23




The
      future minimum lease payments are as follows:


2007
              
              $
              928,3342008
              
              
              655,9342009
              
              
              889,6302010
              
              
              484,8522011
              
              
              24,4492,983,199Less
                  imputed interest
              
              
              483,459$
              2,499,740




Interest
      expense for the year related to capital assets was $ 254,005 (2005 - $Nil).




**14.**
            **Incomes
                Taxes**




The
        Company's provision for (recovery of) income taxes is comprised as
        follows:
 **2006**
              
              **2005**U.S.
              
              $
              -
              
              $
              -CanadianCurrent
              
              
              -
              
              
              -Deferred
              
              
              -
              
              
              -$
              -
              
              $
              -Reconciliation
                  to statutory rates is as follows:**2006**
              
              
              **2005**Income
                  (loss) before income taxesIncome
                  (loss) from U.S. sales
              
              $
              (6,266,742
              )
              $
              1,636,089Income
                  (loss) from Canadian sales
              
              
              724,850
              
              
              (808,515
              )(5,541,892
              )
              
              827,574Statutory
                  tax rates for U.S.
              
              
              41.00
              %
              
              41.00
              %Statutory
                  tax rates for Canadian Federal
              
              
              36.12
              %
              
              36.12
              %


The
        Company has unutilized taxable losses in the United States available for
        carry
        forward to reduce income taxes of approximately $8,051,800 otherwise payable
        in
        future years. In addition, the Company has unutilized taxable losses in the
        Canadian taxes available for carry forward to reduce income taxes of
        approximately $1,687,300 otherwise payable in future years.


**2006**
              
              
              
              
              
              **2005**Expected
                  income tax expense (recovery)
              
              $
              (2,305,543
              )
              
              (41.6
              )%
              $
              321,641
              
              
              38.9
              %Increase
                  (decrease) in taxes resulting fromValuation
                  allowances
              
              
              1,719,491
              
              
              31.0
              %
              
              777,672
              
              
              94.0
              %Permanent
                  differences
              
              
              912,607
              
              
              16.5
              %
              
              (1,177,392
              )
              
              (142.3
              %)Small
                  business and other tax rate reductions
              
              
              (249,775
              )
              
              (4.5
              %)
              
              46,353
              
              
              5.6
              %Other
              
              
              (76,780
              )
              
              (1.4
              %)
              
              31,726
              
              
              3.8
              %Income
                  tax expenses (recovery)
              
              $
              -
              
              
              -
              
              $
              -
              
              
              -
  F-24


The
        tax
        effects of temporary differences that give rise to significant portions of
        the
        deferred tax assets and deferred tax liabilities as of December 31, 2006
        and
        2005 are presented below:




**2006**
            
            **2005****Assets**Tax
                benefits on losses carried forward under U.S. tax rate
            
            
            3,660,545
            
            
            517,773Tax
                benefits on losses carried forward under Canadian tax rate
            
            
            1,600,876
            
            
            256,536Accounting
                depreciation in excess of tax depreciation
            
            
            32,746
            
            
            9,591Other
            
            
            785
            
            
            4,9095,294,952
            
            
            788,809Less:
                valuation allowance
            
            
            (5,261,421
            )
            
            (774,309
            )33,531
            
            
            14,500Less:
                current portion
            
            
            (785
            )
            
            (721
            )$
            32,746
            
            $
            13,779**Liabilities**Income
                tax depreciation in excess of accounting depreciation
            
            $
            -
            
            $
            -Other
            
            
            23,555
            
            
            4,52423,555
            
            
            4,524Less:
                current portion
            
            
            (23,555
            )
            
            (4,524
            )$
            -
            
            $
            -




Net
                deferred income taxes**2006**
            
            **2005****Current**Assets
            
            $
            785
            
            $
            721Liabilities
            
            
            (23,555
            )
            
            (4,524
            )$
            (22,770
            )
            $
            (3,803
            )**Long-term**Assets
            
            $
            32,746
            
            $
            13,779Liabilities
            
            
            -
            
            
            -$
            32,746
            
            $
            13,779$
            9,976
            
            $
            9,976


**15.**
              **Warranty**




As
      part
      of the installation, the Company has provided its customers with warranties.
      The
      warranties generally extend ninety days labor and one year on equipment from
      the
      date of project completion.




**2006**
            
            **2005**Balance,
                beginning of year
            
            $
            34,482
            
            $
            9,228Expenses
                incurred
            
            
            (10,000
            )
            
            (17,636
            )Provision
                made
            
            
            10,000
            
            
            42,890Balance,
                end of year
            
            $
            34,482
            
            $
            34,482





F-25




**16.**
              **Shareholders’
                  (Deficit)**




The
      Company has total authorized share capital of 50,000,000 preferred shares,
      no
      par value and 100,000,000 common shares, no par value.




During
      the period ended March 31, 2006, the Company entered into two consulting
      agreements by issuing 125,000 shares stock in consideration for investor
      relations services rendered with the fair value of $65,000. Total recognized
      consulting expenses relating to the above shares are $65,000. Additionally,
      the
      Company entered into another consulting agreement by issuing 75,000 shares
      in
      consideration for advisory service rendered with the fair value of $41,250.
      Total recognized advisory service expenses relating to the above shares are
      $41,250.




During
      the period ended June 30, 2006, the Company entered into three consulting
      agreements by issuing 70,880 shares stock in consideration for investor
      relations and consulting services rendered with the fair value of $52,050.
      Total
      recognized consulting expenses relating to the above shares are $52,050.




During
      the period ended September 30, 2006, the Company entered into a consulting
      agreement by issuing 41,665 shares stock in consideration for investor relations
      and consulting services rendered with the fair value of $28,749. Total
      recognized consulting expenses relating to the above shares was $28,749.
      Additionally, the Company issued 7,000 common shares to the officer of A.C.
      Technical with the fair value of $2,100. The expense was recorded under general
      and administration expenses.




During
      the period ended December 31, 2006, the Company entered into a consulting
      agreement by issuing 49,998 shares stock in consideration for investor relations
      and consulting services rendered with the fair value of $15,999. Total
      recognized consulting expenses relating to the above shares was $15,999.
      Additionally, the Company issued 243,307 common shares to the legal counsel
      with
      the fair value of $97,325. The expense was recorded under general and
      administration expenses. The Company also issued 215,517 and 323,275 shares
      to
      1608913 Ontario Inc. and Nationwide for the payment of the consulting fees
      with
      a fair value of $215,517.




**Options**




On
      June
      30, 2006, the Company granted 2,317,000 options to purchase a maximum of
      2,317,000 shares of common stock to employees. The options allow the holders
      to
      buy the Company’s common stock at a price of $0.63 per share and expire on June
      30, 2011.




The
      Company’s Stock Option Plan is intended to provide incentives for key employees,
      directors, consultants and other individuals providing services to the Company
      by encouraging their ownership of the common stock of the Company and to aid
      the
      Company in retaining such key employees, directors, consultants and other
      individuals upon whose efforts the Company’s success and future growth depends
      and in attracting other such employees, directors, consultants and
      individuals.




The
      Plan
      is administered by the Board of Directors, or its Compensation Committee. Under
      the Plan, options on a total of 4,000,000 shares of common stock may be issued.
      Shares of common stock covered by options which have terminated or expired
      prior
      to exercise are available for further options under the Plan. The maximum
      aggregate number of shares of Stock that may be issued under the Plan as
“incentive stock options” is 3,500,000 shares. No options may be granted under
      the Plan after June 30, 2011; provided, however, that the Board of Directors
      may
      at any time prior to that date amends the Plan.




Options
      under the Plan may be granted to key employees of the Company, including
      officers or directors of the Company, and to consultants and other individuals
      providing services to the Company. Options may be granted to eligible
      individuals whether or not they hold or have held options previously granted
      under the Plan or otherwise granted or assumed by the Company. In selecting
      individuals for options, the Committee may take into consideration any factors
      it may deem relevant, including its estimate of the individual’s present and
      potential contributions to the success of the Company.




F-26




The
      Committee may, in its discretion, prescribe the terms and conditions of the
      options to be granted under the Plan, which terms and conditions need not be
      the
      same in each case, subject to the following:




a.  Option
      Price. The price at which each share of common stock covered by an option
      granted under the Plan may be purchased may not be less than the market value
      per share of the common stock on the date of grant of the option. The date
      of
      the grant of an option shall be the date specified by the Committee in its
      grant
      of the option, which date will normally be the date the Committee determines
      to
      make such grant.




b.  Option
      Period. The period for exercise of an option shall in no event be more than
      five
      years from the date of grant. Options may, in the discretion of the Committee,
      be made exercisable in installments during the option period.




c.  Exercise
      of Options. For the purpose of assisting an Optionee to exercise an option,
      the
      Company may make loans to the Optionee or guarantee loans made by third parties
      to the Optionee, on such terms and conditions as the Board of Directors may
      authorize. In no event shall any option be exercisable more than five years
      from
      the date of grant thereof.




d.  Lock-Up
      Period. Without the consent of the Company, an Optionee may not sell more than
      fifty percent of the shares issued under the Plan for a period of two years
      from
      the date that the Optionee exercises the option. The Committee may impose such
      other terms and conditions, not inconsistent with the terms of the Plan, on
      the
      grant or exercise of options, as it deems advisable.




The
      fair
      value of each option award is estimated on the date of grant using the
      Black-Scholes option valuation model, using the assumptions noted in the
      following table. Expected volatility is based on the historical volatility
      of
      the Company’s stock, and other factors. The Company uses historical data to
      estimate employee termination within the valuation model. Because the Company
      has not previously granted options to employees, for purposes of the valuation
      model, the Company has assumed that the life of the options will be equal to
      one-half of the combined vesting period and contractual life (i.e., that
      employees will exercise the options at the midpoint between the vesting and
      expiry date of the options). The risk-free rates used to value the options
      are
      based on the U.S. Treasury yield curve in effect at the time of
      grant.




At
      December 31, 2006, options to purchase 2,317,000 shares of common stock were
      outstanding. These options vest ratably in annual installments, over the four
      year period from the date of grant. As of December 31, 2006, there was $476,200
      of total unrecognized compensation cost related to non-vested share-based
      compensation arrangements granted under the Plan. That cost is expected to
      be
      recognized over the four year vesting period. No options were vested as of
      December 31, 2006. The cost recognized for the period end December 31, 2006
      was
      $63,530 which was recorded as the general and administration
      expenses.




In
      valuing the options issued on June 30, 2006 the following assumptions were
      used




December
                31, 2006Expected
                volatility
            
            
            45
            %Expected
                dividends
            
            
            0
            %Expected
                term (in years)
            
            
            3.0
                - 4.5Risk-free
                rate
            
            
            5.10%
                - 5.13
            %




A
      summary
      of option activity under the Plan during the year ended December 31, 2006 is
      presented below:




F-27




Options
            
            Shares
            
            Weighted-Average
              Exercise
              Price
            
            Weighted-Average
              Remaining
              Contractual
              Term
            
            Intrinsic
              ValueOutstanding
                at January 1, 2006
            
            
            -
            
            
            -Granted
            
            
            2,317,000
            
            $
            0.63Exercised
            
            
            -
            
            
            -Forfeited
                or expired
            
            
            -
            
            
            -Outstanding
                at December 31, 2006
            
            
            2,317,000
            
            $
            0.63
            
            
            5.0
            
            $
            -Exercisable
                at December 31, 2006
            
            
            -
            
            
            -
            
            
            -
            
            
            -




**Warrants**




The
      Company uses the Black-Scholes option pricing model to value warrants
      issued to non-employees, based on the market price of our common stock at the
      time the warrants are issued. All outstanding warrants may be exercised by
      the
      holder at any time. During the quarter ended March 31, 2006, in connection
      with
      financing arrangements, the Company issued warrants to purchase 2,411,003 shares
      of common stock. The fair value of the warrants of $1,913,571 was measured
      using
      the Black-Scholes option pricing model using the following assumptions: risk
      free interest rate of 4.33%, expected dividend yield of 0%, volatility of 45%
      to
      50%, share price of $0.01 and unlimited contractual lives.




As
      of
      December 31, 2006, we had the following options and warrants
      outstanding:




**Expiry**
                **Date**
              
              
              **Number
                  of**
                **options
                  or**
                **warrants**
              
              
              **Exercise**
                **Price
                  Per**
                **Share**
              
              
              **Value
                  -**
                **issue
                  date**
              
              **Issued
                  for**09-30-2004
              
              
              09-30-2009
              
              
              540,000
              
              $
              0.33
              
              $
              447,463
              
              Consulting
                  and investment
                banking
                  fees09-30-2004
              
              
              09-30-2009
              
              
              199,500
              
              $
              0.33
              
              $
              111,853
              
              Consulting
                  and investment
                banking
                  fees09-30-2004
              
              
              09-30-2011
              
              
              2,250,000
              
              
              1.15
              
              
              1,370,000
              
              Financing03-31-2005
              
              
              03-31-2012
              
              
              100,000
              
              
              1.20
              
              
              60,291
              
              Financing04-30-2005
              
              
              04-30-2012
              
              
              100,000
              
              
              1.01
              
              
              44,309
              
              Financing05-31-2005
              
              
              05-31-2012
              
              
              100,000
              
              
              1.01
              
              
              56,614
              
              Financing06-22-2005
              
              
              06-22-2012
              
              
              313,000
              
              
              1.00
              
              
              137,703
              
              Financing06-30-2005
              
              
              06-30-2012
              
              
              100,000
              
              
              0.90
              
              
              50,431
              
              Financing07-31-2005
              
              
              07-31-2012
              
              
              100,000
              
              
              1.05
              
              
              56,244
              
              Financing08-31-2005
              
              
              08-31-2012
              
              
              100,000
              
              
              1.05
              
              
              22,979
              
              Financing09-30-2005
              
              
              09-30-2012
              
              
              100,000
              
              
              0.80
              
              
              36,599
              
              Financing10-31-2005
              
              
              10-31-2012
              
              
              100,000
              
              
              0.80
              
              
              27,367
              
              Financing11-30-2005
              
              
              11-30-2012
              
              
              100,000
              
              
              0.80
              
              
              16,392
              
              Financing12-31-2005
              
              
              12-31-2012
              
              
              100,000
              
              
              0.80
              
              
              10,270
              
              Financing02-13-2006
              
              
              02-13-2016
              
              
              2,411,003
              
              
              0.01
              
              
              1,913,571
              
              Financing6,713,503
 F-28
  **17****.**
              **Major
                  Customers**




During
      the year ended December 31, 2006, the Company derived 61% of its revenue from
      a
      single customer.


**18.**
              **Segment
                  Information**




We
      determine and disclose our segments in accordance with SFAS No. 131 “Disclosures
      about Segments of an Enterprise and Related Information”, which uses a
“management” approach for determining segments. The management approach
      designates the internal organization that is used by management for making
      operating decisions and assessing performance as the source of the reportable
      segments. Our management reporting structure provides for the following
      segments:




Cancable




Cancable
      Inc. (“Cancable”) is a Canadian based entity involved the provisioning,
      deployment and servicing of broadband technologies in both residential and
      commercial markets. The Cancable service offering, network deployment, IT
      integration, and support services, enable the cable television and
      telecommunications industries to deliver a high quality broadband experience
      to
      their customers. Cancable’s clients rely on Cancable’s knowledge and expertise
      to rapidly deploy the latest technologies to support advanced cable services,
      cable broadband Internet access and DSL. Services provisioned include new
      installations, reconnections, disconnections, service upgrades and downgrades,
      inbound technical call center sales and trouble resolution for cable Internet
      subscribers, and network servicing for broadband video, data, and voice services
      for residential, business, and commercial marketplaces.




AC
      Technical




A.C.
      Technical Systems Ltd. (“AC Technical”), a corporation incorporated under the
      laws of the Province of Ontario, is engaged in the engineering, design,
      installation, integration and servicing of various types of security systems.




Iview
      DVSI




Iview
      Digital Solutions Inc. (“Iview DVSI”), a corporation incorporated under the laws
      of the Province of Ontario. It is a newly formed subsidiary incorporated in
      late
      2005 to focus on providing video surveillance products and technologies to
      the
      market.




The
      following table presents financial information with respect to the segments
      that
      management uses to make decisions. We acquired Cancable as of January 1, 2006
      and its results are included from that date..




F-29


**December
                31, 2006**
            
            **December
                31, 2005****SALES:**Cancable
            
            $
            23,779,440
            
            $
            -AC
                Technical
            
            
            6,492,163
            
            
            8.692,275Iview
            
            
            157,594
            
            
            -Creative
                Vistas, Inc.
            
            
            27,700
            
            
            25,768**Consolidated
                Total**
            
            $
            30,456,897
            
            $
            8,718,043**DEPRECIATION
                AND AMORTIZATION:**Cancable
            
            $
            939,054
            
            $
            -AC
                Technical
            
            
            43,613
            
            
            44,215**Consolidated
                Total**
            
            $
            982,667
            
            $
            44,215**INTEREST
                EXPENSES:**Cancable
            
            $
            930,872
            
            
            -AC
                Technical
            
            
            10,768
            
            
            15,041Iview
            
            
            179,568
            
            
            -AC
                Acquisition
            
            
            48,091
            
            
            45,000Creative
                Vistas, Inc.
            
            
            3,448,526
            
            
            2,247,229**Consolidated
                Total**
            
            $
            4,617,825
            
            
            2,307,270**NET
                INCOME (LOSS):**Cancable
            
            $
            896,633
            
            $
            -AC
                Technical
            
            
            (150,509
            )
            
            (715,471
            )Iview
            
            
            (200,100
            )
            
            (3,044
            )AC
                Acquisition
            
            
            (48,091
            )
            
            (45,000
            )Corporate
                (1)
            
            
            (6,039,825
            )
            
            1,591,089**Consolidated
                Total**
            
            $
            (5,541,892
            )
            $
            827,574**TOTAL
                ASSETS**Cancable
            
            $
            7,880,618
            
            $
            -AC
                Technical
            
            
            3,719,040
            
            
            4,351,177Iview
            
            
            1,697,555
            
            
            22,777AC
                Acquisition
            
            
            -
            
            
            -Creative
                Vistas, Inc.
            
            
            4,972,712
            
            
            1,442,821**Consolidated
                Total**
            
            $
            18,269,925
            
            $
            5,816,775**CAPITAL
                ASSETS**Cancable
            
            $
            3,058,227
            
            $
            -AC
                Technical
            
            
            766,328
            
            
            804,907**Consolidated
                Total**
            
            $
            3,824,555
            
            $
            804,907**CAPITAL
                EXPENDITURES**Cancable
            
            $
            2,215,878
            
            $
            -AC
                Technical
            
            
            -
            
            
            -Iview
            
            
            -
            
            
            -AC
                Acquisition
            
            
            -
            
            
            -**Consolidated
                Total**
            
            $
            2,215,878
            
            $
            -




(1)
            Corporate
                expenses primarily include certain stock-based compensation for consulting
                and advisory services and derivative financial instrument expense,
                which
                we do not internally allocate to our segments because they are related
                to
                our common stock and are non-cash in
                nature.




Revenues
      by geographic destination and product group were as follows:




**December
                31,**
              **2006**
            
            **December
                31,**
              **2005**Contract
            
            $
            5,352,841
            
            $
            7,421,696Service
            
            
            25,061,831
            
            
            1,296,347Others
            
            
            42,225
            
            
            -Total
                sales to external customers
            
            $
            30,456,897
            
            $
            8,718,043


All
      revenue generated by the Company was in Canada.


**19.**
                **Diluted
                    Loss Per Share**







F-30


2006
            
            2005Basic
                weighted average shares outstanding
            
            
            32,394,008
            
            
            30,945,604Convertible
                debt assumed conversion
            
            
            -
            
            
            8,087,768Warrants
            
            
            -
            
            
            1,112,24432,394,008
            
            
            40,145,615Net
                income (loss)
            
            $
            (5,544,897
            )
            $
            827,574Interest
                on convertible debt
            
            
            -
            
            
            427,327Derivative
                income
            
            
            -
            
            
            (2,479,975
            )(Loss)
                available for diluted EPS
            
            $
            (5,541,892
            )
            $
            (2,470,065
            )Diluted
                (loss) per share
            
            $
            (0.17
            )
            $
            (0.06
            )


**20.**
                **Commitments**




The
      Company has entered into contracts for certain consulting services providing
      for
      monthly payments with the Companies controlled by the CEO and the president’s
      spouse. In addition, the Company has also entered into an operating lease for
      its premises, vehicles, computers and office equipment. The total minimum annual
      payments for the next three years are as follows:




**Total**
            
            **2007**
            
            **2008**
            
            **2009**Operating
                leases
            
            $
            933,700
            
            $
            467,800
            
            $
            327,400
            
            $
            138,500Commitments
                related to consulting agreements
            
            
            1,961,700
            
            
            598,600
            
            
            652,200
            
            
            710,900$
            2,895,400
            
            $
            1,066,400
            
            $
            979,600
            
            $
            849,400




**21.**
                **Subsequent
                    Events**




On
      March
      20, 2007, the Registrant entered into a number of amendments to its financing
      arrangements with Laurus Master Fund, Ltd. (“Laurus”) primarily to permit the
      Registrant to defer monthly principal payments under its Term Note with Laurus,
      at the Registrant’s option, otherwise due for any of the months from March 2007
      through February 2008 in exchange for issuing Laurus Warrants to purchase
      108,000 shares of Common Stock of the Registrant at an exercise price of $0.90
      per share for each month of postponed principal. The Registrant has exercised
      its option to defer the principal payment due March 1, 2007 and has issued
      a
      Warrant to Laurus. In addition, the Registrant and Laurus have entered into
      a
      side letter confirming the parties’ prior agreement to terminate Laurus’s
      registration and certain anti-dilution rights.




F-31


**Item
                8.**
            **Changes
                In and Disagreements With Accountants on Accounting and Financial
                Disclosure**




Our
      prior
      auditors, BDO Dunwoody, LLP, resigned on February 28, 2006. On or about the
      same
      time, we engaged Stark Winter Schenkein & Co., LLP, as our principal
      independent accountant. The decision to change accountants was made with the
      approval of our board of directors.




During
      the most recent two fiscal years and prior to the resignation of our prior
      auditors on February 28, 2006, the Company had not consulted with Stark Winter
      Schenkein & Co., LLP on any issue including the application of accounting
      principles to a specified transaction, either completed or proposed, or the
      type
      of audit opinion that might be rendered on our financial statements, and neither
      a written report was provided to us nor oral advice was provided that was an
      important factor considered by us in reaching a decision as to our accounting,
      auditing or financial reporting issues.





No
      report
      of BDO Dunwoody, LLP on our financial statements for either of the past two
      fiscal years 2005 and 2004 contained an adverse opinion, a disclaimer of opinion
      or a qualification or was modified as to uncertainty, audit, scope or accounting
      principles.




We
      believe and we have been advised by BDO Dunwoody, LLP that it concurs in such
      belief that, during our two most recent fiscal years and any subsequent interim
      period through the date of their resignation on February 28, 2006, we did not
      have any disagreement on any matter of accounting principles or practices,
      financial statement disclosure or auditing scope or procedure, which
      disagreement, if not resolved to the satisfaction of BDO Dunwoody, LLP, would
      have caused it to make reference in connection with its report on our financial
      statements to the subject matter of this disagreement.





No
      report
      of BDO Dunwoody, LLP on our financial statements for the years ended December
      31, 2004 contained an adverse opinion, a disclaimer of opinion or a
      qualification or was modified as to uncertainty, audit, scope or accounting
      principles. During the years ended December 31, 2004 and any subsequent interim
      period the former accountant’s resignation, February 28, 2006, there were no
“reportable events” within the meaning of Item 304(a)(1) of Regulation S-B
      promulgated under the Securities Act.




**Item
                8A.**
            **Controls
                and Procedures**




**Evaluation
      of Disclosure Controls and Procedures** As of December 31, 2006, the end of the period covered by this annual report
      on
      Form 10K-SB, our management, including our Chief Executive Officer and Chief
      Financial Officer, assessed the effectiveness of our disclosure controls and
      procedures, as such terms are defined under rules 13a-15(e) and 15d-15(e)
      promulgated under Securities Exchange Act of 1934, as amended. Based on this
      assessment, our management concluded that our disclosure controls and procedures
      were effective as of the end period covered by this annual report.




**Changes
      in Internal Control Over Financial Reporting** There has not been any change in our internal control over financial reporting
      (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the
      Exchange Act) during our fourth fiscal quarter that has materially affected,
      or
      is reasonably likely to materially affect, our internal control over financial
      reporting.




**Item
                8B.**
            **Other
                Information**




None




**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**Sayan
                Navaratnam
            32
            Chairman,
                Chief Executive Officer and DirectorDominic
                Burns
            47
            President
                and DirectorHeung
                Hung Lee
            38
            Chief
                Financial Officer and Secretary




27


Sayan
      Navaratnam-Director, Chairman and Chief Executive Officer : Mr.
      Navaratnam serves as our chairman and Chief Executive Officer. He is responsible
      for creating a platform for growth and the management of the overall vision
      and
      growth of the Company and its subsidiaries. He is also responsible for managing
      the relationship between us and our key funding partner. Mr. Navaratnam's
      mandate is to develop and enhance our portfolio of subsidiaries and
      technologies. Mr. Navaratnam graduated from University of Toronto with a Double
      Specialist degree in Economics and Political Science. He has eight years of
      experience in technology development and integration specific to the security
      industry. He also has three years of experience in telecommunications with
      Bell
      Canada. He was the CEO of Satellite Communications Inc., and its research arm
      Satellite Advanced Technologies, from 1997-2000. Mr. Navaratnam was responsible
      for coordinating and financing research and development projects and played
      a
      key role in strategic partnerships, mergers, and licensing technologies. Mr.
      Navaratnam was the Chief Operating Officer in ASPRO Technologies Ltd. from
      2000-2003. He also proposed and implemented a strategic marketing campaign
      to
      license and distribute a new line of "wavelet" products from ASPRO. Mr.
      Navaratnam joined AC Technical as Chief Executive Officer in 2003. Mr.
      Navaratnam was a member of Innovator's Alliance of Ontario, Alliance of
      Exporters and manufacturers of Ontario. Mr. Navaratnam and AC Technical were
      recognized with an award for one of the Top 100 fastest growing companies in
      Canada, from 1999 through 2003, by *Profit
      100* .





Dominic
      Burns-Director and President : Mr.
      Burns
      is our President and Director. He founded AC Technical in 1991. He completed
      his
      Electrical Apprenticeship program at one of the premier firms in Northern
      Ireland. He graduated from Belfast College of Technology with honors in City
      and
      Guilds Electrical Theory and Regulations. Mr. Burns also holds a diploma in
      radio and navigation systems. He has an extensive understanding of quality
      controls in the avionics industry and has been a pioneer in transferring some
      of
      the high standards and controls set in the avionics industry to the security
      integration market. He has been the President of AC Technical since its
      inception. He has been primarily responsible for expanding the firm's presence
      in Canada. Mr. Burns has also designed a number of internal technical and
      marketing programs to expand AC Technical's sales and technical capabilities.
      Mr. Burns has over 20 years of experience in the security integration industry.
      Mr. Burns has been a director of our company since September 30,
      2004.




Heung
      Hung Lee-Chief Financial Officer and Secretary : Ms.
      Lee
      joined AC Technical in July 2004 and she has more than 10 years experience
      in
      international public accounting primarily with large international accounting
      firms. She has advanced knowledge in financial statements disclosure and audit
      issues and has extensive international business experience in countries such
      as
      the United States, Hong Kong SAR and the Peoples' Republic of China. She was
      a
      manager at BDO Dunwoody LLP from 1999 to 2004. Ms. Lee holds a Bachelor of
      Business degree from Monash University in Australia. She is a Chartered
      Accountant in Canada and qualified CPA in Australia. Ms. Lee has been the Chief
      Financial Officer of our company since September 30, 2004. Ms. Lee is
      responsible for review of financials of subsidiaries and creating and
      implementing strong financial systems within the group of companies. Ms. Lee
      is
      also an important member in our growth strategy as she is highly involved in
      creating a platform for growth within Creative Vistas, Inc.




**Code
      of Ethics**




The
      Company has adopted a code of ethics for officers and employees, which applies
      to, among others, the Company’s principal executive officer, principal financial
      officer, and controller, and which is known as the code
      of
      ethics .
      The
      Company has also adopted certain ethical principles and policies for its
      directors, which are set forth in the code
      of
      ethics .
      The
      Company will provide copies of the code of ethics without charge upon request
      made to Creative Vistas, 2100
      Forbes Street, Unit 8-10 Whitby, Ontario, Canada L1N 9T3 or by calling (905)
      666-8676 .





28




**Item
                10.**
            **Executive
                Compensation**




The
      following summary compensation table set forth all compensation paid by us
      during the three years ended December 31, 2006 for services rendered in all
      capacities by the Chief Executive Officer of the Company and the only other
      executive officer who received total salary and bonus exceeding $100,000 in
      any
      of such years.




**Annual
                Compensation****Name
                and Principal**
              **Company/Subsidiary
                Position**
            
            **Year**
            
            **Salary
                ($)**
            
            **Other
                Annual Compensation ($)**
            
            **Bonus
                ($)**Sayan
                Navaratnam - Chairman
            
            
            2006
            
            
            202,5001
            
            
            -
            
            
            -and
                Chief Executive Officer
            
            
            2005
            
            
            250,0002
            
            
            -
            
            
            -2004
            
            
            243,0003
            
            
            -
            
            
            -Dominic
                Burns - President
            
            
            2006
            
            
            188,7004
            
            
            -
            
            
            -2005
            
            
            126,0005
            
            
            -
            
            
            -2004
            
            
            177,9006
            
            
            -
            
            
            -






1Including
                $202,500 to Nationwide Solutions Inc. for consulting
                fees.2Including
                $250,000 to Nationwide Solutions Inc. for consulting
                fees.3Including
                $90,000 to Encapsulated Intersoft Systems and $153,000 to Nationwide
                Solutions Inc. for consulting fees.4Including
                $188,700 to 1608913 Ontario Inc. for consulting fees.5Including
                $126,000 to 1608913 Ontario Inc. for consulting fees.6Including
                $81,000 from 1608913 Ontario Inc. for consulting fees and $96,900
                for
                salary.




Employment
      Agreements




On
      June
      1, 2004, AC Technical entered into a consulting agreement with 1608913 Ontario
      Inc. and Dominic Burns. Pursuant to this agreement, 1608913 Ontario is to
      provide the exclusive services of Mr. Burns to us for the following
      compensation:




·
            From
                October 1, 2004 until December 31, 2004 compensation at the rate
                of
                $210,900 (CAD$250,000);




·
            From
                January 1, 2005 until December 31, 2005 the sum of $232,000
                (CAD$275,000);




·
            From
                January 1, 2006 until December 31, 2006 the sum of $253,100
                (CAD$300,000);




·
            From
                January 1, 2007 until December 31, 2007 the sum of $274,200
                (CAD$325,000);




·
            From
                January 1, 2008 until December 31, 2008 the sum of $295,300 (CAD$350,000);
                and




·
            From
                January 1, 2009 until December 31, 2009 the sum of $316,400
                (CAD$375,000).




In
      addition, 1608913 Ontario is entitled to a bonus payable upon our attaining
      the
      annual gross revenue targets specified in the agreement for the calendar years
      2004 through 2009. The bonus is 0.5% of the annual gross revenue targets for
      2004 and 1% of the annual gross revenue target for 2005 through 2009. An
      additional bonus of 2% will be paid for each additional increment of $421,800
      (CAD$500,000) annual gross revenue beyond the revenue target in any given year.
      Mr. Burns’ spouse is the only beneficial owner of 1608913 Ontario.




On
      June
      1, 2004, AC Technical entered into a consulting agreement with Nationwide
      Solutions Inc. and Sayan Navaratnam. Pursuant to this agreement, Nationwide
      is
      to provide the exclusive services of Mr. Navaratnam to us for the following
      compensation:




·
            From
                October 1, 2004 until December 31, 2004 compensation at the rate
                of
                $253,100 (CAD$300,000) per annum;




·
            From
                January 1, 2005 until December 31, 2005 the sum of $278,400
                (CAD$330,000);




29




·
            From
                January 1, 2006 until December 31, 2006 the sum of $306,300
                (CAD$363,000);




·
            From
                January 1, 2007 until December 31, 2007 the sum of $336,900
                (CAD$399,300);




·
            From
                January 1, 2008 until December 31, 2008 the sum of $370,600 (CAD$439,230);
                and




·
            From
                January 1, 2009 until December 31, 2009 the sum of $409,300
                (CAD$485,153).




In
      addition, Nationwide is entitled to a bonus payable upon our attaining the
      annual gross revenue targets specified in the agreement for the calendar years
      2004 through 2009. The bonus is 0.5% of the annual gross revenue targets for
      2004 and 1% of the annual gross revenue target for 2005 through 2009. An
      additional bonus of 2% will be paid for each additional increment of $421,800
      (CAD$500,000) annual gross revenue beyond the revenue target in any given year.
      Mr. Navaratnam is the only beneficial owner of Nationwide.




1608913
      Ontario Inc. and Nationwide Solutions Inc. were structured for the personal
      tax
      benefit of Mr. Burns and Mr. Navaratnam, respectively. Under Canadian tax law,
      there are potential income tax benefits to Mr. Burns and Mr. Navaratnam from
      structuring their relationship to us as Consulting Agreements between us and
      each of 1608913 Ontario Inc. and Nationwide Solutions Inc. instead of them
      being
      employed directly by us. This structure does not have any effect on Creative
      Vistas.




The
      payments to Encapsulated Intersoft Systems and Nationwide Solutions Inc. were
      related to the services provided by Sayan Navaratnam, the chief executive
      officer of A.C. Technical Systems Ltd.




The
      consulting services provided by Encapsulated Intersoft Systems were on a monthly
      basis and were not pursuant to a written agreement. No amounts have become
      due
      to Encapsulated Intersoft Systems after the business acquisition and leveraged
      buyout transactions.




The
      consulting services provided to us by Mr. Navaratnam and Mr. Burns related
      to
      the management of the Company including sales and marketing, project management,
      technology development, finance, operations, mergers and acquisitions,
      engineering design and other management services required by us.




We
      have a
      standard employment contract with our employees that is reviewed on an annual
      basis. Of the persons who currently are parties to this employment agreement,
      only Ms. Lee currently falls under the category of executive staff. There are
      no
      employment contracts with the CEO and the President. In each standard employment
      contract, we have included the terms of employment, remuneration, fringe
      benefits, vacation, confidentiality, non—solicitation and termination of
      employment.




We
      have a
      stock option plan which was adopted during the second quarter of
      2006.







**Item
                11.**
            **Security
                Ownership of Certain Beneficial Owners and Management and Related
                Stockholder Matters**




The
      following table sets forth information with respect to the beneficial ownership
      of our common stock as of December 31, 2006 of each executive officer, each
      director, and each shareholder in addition to any shareholders known to be
      the
      beneficial owner of 5% or more of our Common Stock and all officers and
      directors as a group. As of December 31, 2005, Laurus Master Fund, Ltd.
      beneficially owned 1,200,000 shares of our Common Stock. The securities owned
      by
      Laurus Master Fund, Ltd. contain a provision that Laurus may not, subject to
      certain exceptions, at any time beneficially own more than 4.99% of our
      outstanding common stock. We and Laurus have agreed that, other than on 75
      days’
notice or upon the occurrence of an event of default, this provision may not
      be
      waived. Absent this limitation, Laurus would beneficially additionally own
      6,204,000 shares of our common stock, which is comprised of 299,997 shares
      under
      the option and 5,974,000 shares under the warrant.




30




Name
                and Address of Beneficial Owner
            
            Shares
                of Common Stock Beneficially Owned
            
            Percentage
                of Common Stock Beneficially OwnedSayan
                Navaratnam
              Toronto,
                Ontario
            
            
            17,209,234
            
            
            51.8
            %Dominic
                Burns
              Hampton,
                Ontario
            
            
            11,297,619
            
            
            34.0
            %Heung
                Hung Lee
              Markham,
                Ontario
            
            
            50,000
            
            
            0.2
            %All
                officers and directors as a group (3 persons)
            
            
            28,556,853
            
            
            86.0
            %




**The
      address of the above listed persons is c/o Creative Vistas, 2100 Forbes Street,
      Unit 8-10 Whitby, Ontario, Canada L1N 9T3.**




**Securities
      Authorized For Issuance Under Equity Compensation Plans**







The
      following table sets forth certain information relating to our option plans
      as
      of December 31, 2006:





**Number
                of Securities****Number
                of Common**
            
            
            
            **Remaining
                Available****Shares
                to be Issued**
            
            **Weighted-Average**
            
            **for
                Future Issuance****upon
                Exercise of**
            
            **Exercise
                Price of**
            
            **under
                Stock Option****Plan
                Category**
            
            **Name
                of Plan**
            
            **Outstanding
                Options**
            
            **Outstanding
                Options**
            
            **Plan****Option
                Plans approved by our Shareholders**
            
            Stock
                Option Plan
            
            
            4,000,000
            
            $
            0.63
            
            
            1,683,000**Total**
            
            
            
            
            
            4,000,000
            
            $
            0.63
            
            
            1,683,000








**Share
      Option and Other Compensation Plans**







***Stock
      Option Plan***







Our
      Stock
      Option plan (“the Plan”) was adopted by our Board and approved by our
      shareholders in June 30, 2006. Our Stock option Plan provides for the grant
      of
      options to key
      employees of the Company, including officers or directors of the Company, and
      to
      consultants and other individuals providing services to the Company .




*Share
      Reserve.* A
      total of 4,000,000 shares of common
      stock, no par value, of the Company (the “Stock”) are
      authorized for issuance under the Stock Option plan as of December 31, 2006. Shares
      of
      Stock used for purposes of the Plan may be either authorized and unissued
      shares, or previously issued shares held in the treasury of the Company, or
      both. Shares of Stock covered by options which have terminated or expired prior
      to exercise shall be available for further options hereunder. The maximum
      aggregate number of shares of Stock that may be issued under the Plan under
      “incentive stock options” is 3,500,000 shares.







*Administration
      of Awards.* The
      Plan
      shall be administered by the Board of Directors, or Compensation Committee
      of
      the Board of Directors or a subcommittee of the Compensation Committee appointed
      by the Compensation Committee, or by any other committee designated by the
      Board
      of Directors to administer the Plan (the committee or subcommittee administering
      the Plan is hereinafter referred to as the “Committee”). For purposes of
      administration, the Committee, subject to the terms of the Plan, shall have
      plenary authority to establish such rules and regulations, to make such
      determinations and interpretations, and to take such other administrative
      actions as it deems necessary or advisable. All determinations and
      interpretations made by the Committee shall be final, conclusive and binding
      on
      all persons, including all Optionees, any other holders of options and their
      legal representatives and beneficiaries.




Options
      may be granted to eligible individuals whether or not they hold or have held
      options previously granted under the Plan or otherwise granted or assumed by
      the
      Company. In selecting individuals for options, the Committee may take into
      consideration any factors it may deem relevant, including its estimate of the
      individual’s present and potential contributions to the success of the Company.
      Service as an employee, director, officer or consultant of or to the Company
      shall be considered employment for purposes of the Plan (and the period of
      such
      service shall be considered the period of employment for purposes of Section
      5(d) of this Plan); provided, however, that incentive stock options may be
      granted under the Plan only to an individual who is an “employee” (as such term
      is used in Section 422 of the Code) of the Company.




31


*Stock
      options.* The
      Committee shall, in its discretion, prescribe the terms and conditions of the
      options to be granted hereunder, which terms and conditions need not be the
      same
      in each case, subject to the following:




*(a)Option
      Price* .
      The
      price at which each share of Stock covered by an option granted under the Plan
      may be purchased shall not be less than the Market Value (as defined in Section
      (c) hereof) per share of Stock on the date of grant of the option. The date
      of
      the grant of an option shall be the date specified by the Committee in its
      grant
      of the option.




*(b)Option
      Period* .
      The
      period for exercise of an option shall in no event be more than five years
      from
      the date of grant. Options may, in the discretion of the Committee, be made
      exercisable in installments during the option period. Any shares not purchased
      on any applicable installment date may be purchased thereafter at any time
      before the expiration of the option period.




*(c)Exercise
      of Options* .
      In
      order to exercise an option, the Optionee shall deliver to the Company written
      notice specifying the number of shares of Stock to be purchased, together with
      cash or a certified or bank cashier’s check payable to the order of the Company
      in the full amount of the purchase price therefore; provided that, for the
      purpose of assisting an Optionee to exercise an option, the Company may make
      loans to the Optionee or guarantee loans made by third parties to the Optionee,
      on such terms and conditions as the Board of Directors may authorize. For
      purposes of the Plan, the Market Value per share of Stock shall be the last
      sale
      price regular way on the date of reference, or, in case no sale takes place
      on
      such date, the average of the closing high bid and low asked prices regular
      way,
      in either case on the principal national securities exchange on which the Stock
      is listed or admitted to trading, or if the Stock is not listed or admitted
      to
      trading on any national securities exchange, the last sale price reported on
      the
      National Market System of the National Association of Securities Dealers
      Automated Quotation System (“NASDAQ”) on such date, or the last sale price
      reported on the NASDAQ SmallCap Market on such date, or the average of the
      closing high bid and low asked prices in the over-the-counter market on such
      date, whichever is applicable, or if there are no such prices reported on NASDAQ
      or in the over-the-counter market on such date, as furnished to the Committee
      by
      any New York Stock Exchange member selected from time to time by the Committee
      for such purpose. If there is no bid or asked price reported on any such date,
      the Market Value shall be determined by the Committee in accordance with the
      regulations promulgated under Section 2031 of the Code, or by any other
      appropriate method selected by the Committee. If the Optionee so requests,
      shares of Stock purchased upon exercise of an option may be issued in the name
      of the Optionee or another person. An Optionee shall have none of the rights
      of
      a stockholder until the shares of Stock are issued to him.




*(d)
      Effect of Termination of Employment* .
      An
      option may not be exercised after the Optionee has ceased to be in  the
      employ of the Company, except in the following circumstances:




(i)
      If
      the Optionee’s employment is terminated by action of the Company, or by reason
      of disability or retirement under any retirement plan maintained by the Company,
      the option may be exercised by the Optionee within three months after such
      termination, but only as to any shares exercisable on the date the Optionee’s
      employment so terminates;




(ii)
      In
      the event of the death of the Optionee during the three month period after
      termination of employment covered by (i) above, the person or persons to whom
      his rights are transferred by will or the laws of descent and distribution
      shall
      have a period of one year from the date of his death to exercise any options
      which were exercisable by the Optionee at the time of his death;
      and




(iii)
      In
      the event of the death of the Optionee while employed, the option shall
      thereupon become exercisable in full, and the person or persons to whom the
      Optionee’s rights are transferred by will or the laws of descent and
      distribution shall have a period of one year from the date of the Optionee’s
      death to exercise such option. In no event shall any option be exercisable
      more
      than five years from the date of grant thereof. Nothing in the Plan or in any
      option granted pursuant to the Plan (in the absence of an express provision
      to
      the contrary) shall confer on any individual any right to continue in the employ
      of the Company or continue as a consultant or interfere in any way with the
      right of the Company to terminate his employment or consulting arrangement
      at
      any time.




*(e)
      Limitation on Transferability of Options* .
      Except
      as provided in this Section (e), during the lifetime of an Optionee, options
      held by such Optionee shall be exercisable only by him and no option shall
      be
      transferable other than by will or the laws of descent and distribution. The
      Committee may, in its discretion, provide that options held by an Optionee,
      other than incentive stock options, may be transferred to or for the benefit
      of
      a member of his immediate family. For purposes hereof, the term “immediate
      family” shall mean an Optionee’s spouse and children (both natural and
      adoptive), and the direct lineal descendants of his children.




*(f)
      Adjustments for Change in Stock Subject to Plan* .
      In the
      event of a reorganization, recapitalization, stock split, stock dividend,
      combination of shares, merger, consolidation, rights offering, or any other
      change in the corporate structure or shares of the Company, the Committee shall
      make such adjustments, if any, as it deems appropriate in the number and kind
      of
      shares subject to the Plan, in the number and kind of shares covered by
      outstanding options, or in the option price per share, or both, and, in the
      case
      of a merger, consolidation or other transaction pursuant to which the Company
      is
      not the surviving corporation or pursuant to which the holders of outstanding
      Stock shall receive in exchange therefore shares of capital stock of the
      surviving corporation or another corporation, the Committee may require an
      Optionee to exchange options granted under the Plan for options issued by the
      surviving corporation or such other corporation.




32




*(g
      )Treatment of Options Upon Occurrence of Certain Events* .
      The
      Committee may, in its discretion, provide in the case of any option granted
      under the Plan that, in connection with any merger or consolidation which
      results in the holders of the outstanding voting securities of the Company
      (determined immediately prior to such merger or consolidation) owning, directly
      or indirectly, less than a majority of the outstanding voting securities of
      the
      surviving corporation (determined immediately following such merger or
      consolidation), or any sale or transfer by the Company of all or substantially
      all its assets or any tender offer or exchange offer for or the acquisition,
      directly or indirectly, by any person or group of all or a majority of the
      then
      outstanding voting securities of the Company, such option shall terminate within
      a specified number of days after notice to the Optionee thereunder, and each
      such Optionee shall receive, with respect to each share of Stock subject to
      such
      option, an amount equal to the excess, if any, of the Market Value of such
      shares immediately prior to such merger, consolidation, sale, transfer or
      exchange over the exercise price per share of such option; and that such amount
      shall be payable in cash, in one or more kinds of property (including the
      property, if any, payable in the transaction) or a combination thereof, as
      the
      Committee shall determine in its sole discretion.




*(h)
      Registration, Listing and Qualification of Shares of Stock* .
      Each
      option shall be subject to the requirement that if at any time the Board of
      Directors shall determine that the registration, listing or qualification of
      the
      shares of Stock covered thereby upon any securities exchange or under any
      federal or state law, or the consent or approval of any governmental regulatory
      body is necessary or desirable as a condition of, or in connection with, the
      granting of such option or the purchase of shares of Stock thereunder, no such
      option may be exercised unless and until such registration, listing,
      qualification, consent or approval shall have been effected or obtained free
      of
      any conditions not acceptable to the Board of Directors. The Company may require
      that any person exercising an option shall make such representations and
      agreements and furnish such information as it deems appropriate to assure
      compliance with the foregoing or any other applicable legal
      requirement.




*(i)
      Lock-Up Period* -
      Without
      the consent of the Company an Optionee may not sell more than fifty percent
      of
      the shares issued under the Plan for a period of two years from the date that
      the optionee exercises the option. The Committee may impose such other terms
      and
      conditions, not inconsistent with the terms hereof, on the grant or exercise
      of
      options, as it deems advisable.




*Additional
      Provisions Applicable to Stock Option Plan* .
      The
      Committee may, in its discretion, grant options under the Plan to eligible
      employees which constitute “incentive stock options” within the meaning of
      Section 422 of the Code; provided, however, that (a) the aggregate Market Value
      of the Stock with respect to which incentive stock options are exercisable
      for
      the first time by the Optionee during any calendar year shall not exceed the
      limitation set forth in Section 422(d) of the Code; and (b) notwithstanding
      anything to the contrary in Section 5, if the Optionee owns on the date of
      grant
      securities possessing more than 10% of the total combined voting power of all
      classes of securities of the Company or of any parent or subsidiary of the
      Company, the price per share shall not be less than 110% of the Market Value
      per
      share on the date of grant and the period of exercise shall not be longer than
      five years from the date of grant.




*Amendment
      and Termination* .
      No
      option shall be granted hereunder after June 30, 2011; provided, however, that
      the Board of Directors may at any time prior to that date terminate the Plan.
      The Board of Directors may at any time amend the Plan or any outstanding
      options. No termination or amendment of the Plan may, without the consent of
      an
      Optionee, adversely affect the rights of such Optionee under any option held
      by
      such Optionee.




**Item
                12.**
            **Certain
                Relationships and Related
                Transactions**




On
      September 29, 2004, pursuant to a Stock Purchase Agreement with The Burns Trust
      (our president is one of the beneficiaries of the trust) and The Navaratnam
      Trust (our CEO is one of the beneficiaries of the trust), as sellers, A.C.
      Technical Systems Ltd. and A.C. Technical Acquisition Corp., as purchasers,
      AC
      Acquisition acquired all of the issued and outstanding shares of AC Technical
      from The Burns Trust and The Navaratnam Trust for consideration consisting
      of
      promissory notes in the aggregate amount of $3,300,000. AC Technical became
      an
      indirect subsidiary of the Company and a wholly owned direct subsidiary of
      AC
      Acquisition. $1,800,000 has been paid to The Burns Trust and The Navaratnam
      Trust through part of the funding from Laurus. As at December 31, 2004, the
      aggregate outstanding payables to The Burns Trust and the Navaratnam Trust
      were
      $1,500,000 in the form of 3% promissory notes with no fixed repayment date
      and
      these notes are payable upon demand. However, pursuant to the Laurus financing,
      these notes have been subordinated to the Company’s obligations to Laurus. The
      notes each with an amount of $750,000 are due to The Burns Trust (our president
      is one of the beneficiaries of the trust) and the Navaratnam Trust (our CEO
      is
      one of the beneficiaries of the trust), respectively. Interest expense for
      both
      of these notes payable recognized for the fiscal year 2005 was $45,000
      (2004:$11,250). During the period ended June 30, 2006, the above two notes
      payable have been transferred to Malar Trust Inc. (the Company’s CEO is the
      shareholder of Malar Trust Inc.). See Note 4 of the Financial Statements for
      the
      year ended December 31, 2006




33




**Item
                13.**
            **Exhibits**




3.1*
            Articles
                of Incorporation, as amended to date, incorporated by reference to
                the
                Registrant’sForm
                8-K/A filedFebruary
                2, 20053.2*
            By-laws
                of the Registrant incorporated by reference to the Registrant’s Form 10-SB
                filed May 10, 20004.1*
            Securities
                Purchase Agreement, dated February 13, 2006, by and among Laurus
                Master
                Fund, Ltd., Creative Vistas, Inc., Iview Holding Corp. and Iview
                Digital
                Video Solutions Inc. incorporated by reference to the Registrant’s Form
                8-K filed February 17, 2006.4.2*
            Secured
                Term Note, dated February 13, 2006, issued by Creative Vistas, Inc.
                to
                Laurus Master Fund, Ltd. incorporated by reference to the Registrant’s
                Form 8-K filed February 17, 2006.4.3*
            Secured
                Term Note, dated February 13, 2006, issued by Iview Digital Video
                Solutions Inc. to Laurus Master Fund, Ltd. incorporated by reference
                to
                the Registrant’s Form 8-K filed February 17, 2006.4.4*
            Option,
                dated February 13, 2006, issued by Iview Holding Corp. to Laurus
                Master
                Fund, Ltd. incorporated by reference to the Registrant’s Form 8-K filed
                February 17, 2006.4.5*
            Warrant,
                dated February 13, 2006, issued by Creative Vistas, Inc. to Laurus
                Master
                Fund, Ltd. incorporated by reference to the Registrant’s Form 8-K filed
                February 17, 2006.4.6*
            Amended
                and Restated Guaranty, dated February 13, 2006 by and among Creative
                Vistas, Inc., Cancable Inc., Cancable Holding Corp., Cancable, Inc.,
                A.C.
                Technical Systems Ltd., Creative Vistas Acquisition Corp., Iview
                Holding
                Corp. and Iview Digital Video Solutions Inc. incorporated by reference
                to
                the Registrant’s Form 8-K filed February 17, 2006.4.7*
            Amended
                and Restated Guaranty, dated February 13, 2006 between Brent W. Swanick
                and Laurus Master Fund, Ltd. incorporated by reference to the Registrant’s
                Form 8-K filed February 17, 2006.4.8*
            Side
                Agreement, dated February 13, 2006 between Iview Digital Video Solutions,
                Inc., Iview Holding Corp., Creative Vistas Acquisition Corp. and
                Laurus
                Master Fund, Ltd incorporated by reference to the Registrant’s Form 8-K
                filed February 17, 2006.4.9*
            Joinder
                and Confirmation of Security Agreement, dated February 13, 2006 among
                Iview Holding Corp., Cancable Inc., Cancable Holding Corp., Cancable,
                Inc., A.C. Technical Systems Ltd., Creative Vistas Acquisition Corp.,
                Iview Digital Video Solutions Inc., and Creative Vistas, Inc. delivered
                to
                Laurus Master Fund, Ltd. incorporated by reference to the Registrant’s
                Form 8-K filed February 17, 2006.4.10*
            First
                Amendment to Securities Purchase Agreement, dated February 13, 2006,
                by
                and among Cancable Inc., Cancable Holding Corp.****and
                Laurus Master Fund, Ltd. for the purpose of amending the terms of
                that
                certain Securities Purchase Agreement by and among Cancable Inc.,
                Cancable
                Holding Corp. and Laurus, dated as of December 31, 2005 incorporated
                by
                reference to the Registrant’s Form 8-K filed February 17,
                2006.4.11*
            Registration
                Rights Agreement, dated as of February 13, 2006, by and between Creative
                Vistas, Inc. and Laurus Master Fund, Ltd. incorporated by reference
                to the
                Registrant’s Form 8-K filed February 17, 2006.10.1*
            Stock
                Option Plan, incorporated by reference to the Registrant’s Form S-8 filed
                October 6 200610.2+
            Agreement
                between Rogers Cable Communications Inc. and Cancable Inc. for the
                provision of installation activities and service
                activities.21.1+
            List
                of all subsidiaries31.1+
            Certification
                of Principal Executive Officer Pursuant to Section 302 of the
                Sarbanes-Oxley Act of 200231.2+
            Certification
                of Principal Financial Officer Pursuant to Section 302 of the
                Sarbanes-Oxley Act of 200232.1+
            Chief
                Executive Officer certification pursuant to 18 U.S.C. Section 1350,
                as
                adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
                200232.2+
            Chief
                Financial Officer certification pursuant to 18 U.S.C. Section 1350,
                as
                adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
                2002


_______________




*
      Previously filed and incorporated by reference




+
      Filed
      herewith




34




**Item
                14.**
            **Principal
                Accountant Fees and
                Services**




The
      following table sets forth the aggregate fees for professional services rendered
      to us for the years ended December 31, 2006 and 2005 by our principal accounting
      firms, Stark Winter Schenkein & Co., LLP and BDO Dunwoody LLP:




2006
            
            2005Audit
                Fees (a)
            
            $
            100,000
            
            $
            58,000Audit
                Related Fees (b)
            
            
            20,000
            
            
            60,000Tax
                Fees (c)
            
            
            5,000
            
            
            5,000All
                Other Fees (d)
            
            
            -
            
            
            -Total
            
            $
            125,000
            
            $
            123,000


(a)
              *Audit
                  Fees.*Fees
                  for audit services billed in 2006 consisted of the audit of our
                  annual
                  consolidated financial statements, reviews of our quarterly consolidated
                  financial statements, statutory audits, consents and services that
                  are
                  normally provided in connection with statutory and regulatory filing
                  or
                  engagement. Approximately $100,000 in auditing fees was payable
                  to Stark
                  Winter Schenkein & Co., LLP for the fiscal year 2006.Fees
                  for audit services billed in 2005 consisted of the audit of our
                  annual
                  consolidated financial statements, reviews of our quarterly consolidated
                  financial statements, statutory audits, consents and services that
                  are
                  normally provided in connection with statutory and regulatory filing
                  or
                  engagement. Approximately $45,000 in auditing fees was payable
                  to Stark
                  Winter Schenkein & Co., LLP for the fiscal year 2005. There was
                  approximately $20,000 related to and March 31, 2005, June 20, 2005
                  and
                  September 30, 2005 quarterly reports payable to BDO Dunwoody LLP.(b)
              *Audit-Related
                  Fees.*Fees
                  for audit-related services billed in 2006 and 2005 in preparation
                  of Form
                  8-K and Form S-8 which were paid to Stark Winter Schenkein & Co., LLP
                  $5,000 and BDO Dunwoody, LLP was approximately $15,000.(c)
              *Tax
                  Fees.*Fees
                  for tax services billed in 2006 and 2005 consisting of assistance
                  with our
                  federal, state, local and foreign jurisdiction income tax returns.
                  We have
                  additionally sought consultation and advice related to various
                  tax
                  compliance planning projects. All tax fees were paid to Paul Chan
&
                  Associate in the amount of $5,000**.**
  35
  (d)
              *All
                  Other Fees.*No
                  material other fees were billed in 2006 and 2005.We
                  do not have an audit committee; however, our board of directors
                  is
                  required to provide advance approval of any non-audit services,
                  other than
                  those of a de minimus nature, to be performed by our auditors,
                  provided
                  that such services are not otherwise prohibited by law. We do not
                  have a
                  formal pre-approval policy.All
                  the fees for 2006 and 2005 were pre-approved by the board of directors
                  prior to the auditors’ engagement for these services.




36


**SIGNATURES**




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




**CREATIVE
                VISTAS, INC.**By:
            /s/ Sayan
              NavaratnamSayan
                Navaratnam
              Chief
                Executive Officer




37