UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

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

                  For the quarterly period ended June 30, 2008

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

             For the transition period from _________ to __________

                        Commission file number 000-52317


                                  NETFONE, INC.
        (Exact name of small business issuer as specified in its charter)

            Nevada                                       98-0438201
  (State or other jurisdiction              (I.R.S. Employer Identification No.)
of incorporation or organization)

                        #76017 - 1358 West Georgia Street
                              Vancouver, BC V6E 2Y3
          (Address of principal executive offices, including area code)

                                  604.629.9319
                           (Issuer's telephone number)

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

Check whether the issuer: (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes [X] No [ ]

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: 12,658,000 common shares issued and
outstanding as at August 14, 2008.

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

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

ITEM 1. FINANCIAL STATEMENTS

Our financial statements are stated in United States dollars and are prepared in
accordance with United States Generally Accepted Accounting Principles.


                                       2
<PAGE>
                                  NETFONE, INC.
                          (A Development Stage Company)
                                 BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                      June 30,           September 30,
                                                                        2008                 2007
                                                                     ----------           ----------
                                                                    (Unaudited)          (Audited)
<S>                                                                  <C>                  <C>
                                     ASSETS

CURRENT
  Cash                                                               $    2,319           $    3,655
  Accounts receivable                                                       307                  307
                                                                     ----------           ----------
                                                                          2,626                3,962

EQUIPMENT, NET                                                              897                1,358
                                                                     ----------           ----------

                                                                     $    3,523           $    5,320
                                                                     ==========           ==========

                      LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT
  Accounts payable and accrued liabilities                           $    3,558           $   24,438
  Due to related party                                                  130,543              109,243
                                                                     ----------           ----------

                                                                        134,101              133,681
                                                                     ----------           ----------
COMMON STOCK
  Authorized:
   100,000,000 shares; par value $0.001
  Issued and outstanding:
   12,658,000 shares (September 30, 2007: 12,658,000)                    12,658               12,658
  Additional paid-in capital                                            278,542              278,542
  Deficit accumulated during the development stage                     (421,778)            (419,561)
                                                                     ----------           ----------

                                                                       (130,578)            (128,631)
                                                                     ----------           ----------

                                                                     $    3,523           $    5,320
                                                                     ==========           ==========
</TABLE>


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

                                       3
<PAGE>
                                  NETFONE, INC.
                          (A Development Stage Company)
                            STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                        Three Months    Nine Months      Three Months     Nine Months     June 8, 2004
                                           Ended           Ended            Ended            Ended        (Inception)
                                          June 30,        June 30,         June 30,         June 30,        June 30,
                                            2008            2008             2007             2007            2008
                                          ---------       ---------        ---------        ---------       ---------
<S>                                       <C>             <C>              <C>              <C>             <C>
REVENUE                                   $  12,000       $  12,000        $      --        $      --       $  12,000
                                          ---------       ---------        ---------        ---------       ---------
EXPENSES
  Accounting fees                             2,487           8,545           13,044           20,042          77,669
  Depreciation                                  233             461               --               --             513
  Bank fees and interest                         50             140               45              163             443
  Consulting fees                                --              --               --              673          14,623
  Filing fees and incorporation costs           696           2,397               20            1,917           8,216
  Legal fees                                  1,023           2,601            9,797           11,297          45,055
  Foreign exchange gain (loss)                   --              --               --              779            (748)
  Office and general expenses                    --              73               --               --             600
                                          ---------       ---------        ---------        ---------       ---------

      Total Expenses                          4,489          14,217           22,906           34,871         146,371
                                          ---------       ---------        ---------        ---------       ---------

Net income (loss) from continued
operations                                    7,511          (2,217)         (22,906)         (34,871)       (134,371)

DISCONTINUED OPERATIONS
  Profit (loss) from operations                  --              --               --            1,741        (333,472)
  Gain on sale of subsidiary                     --              --               --           46,065          46,065
                                          ---------       ---------        ---------        ---------       ---------


NET INCOME (LOSS)                         $   7,511       $  (2,217)       $ (22,906)       $  12,935       $(421,778)
                                          =========       =========        =========        =========       =========
</TABLE>


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

                                       4
<PAGE>
                                  NETFONE, INC.
                          (A Development Stage Company)
                            STATEMENTS OF CASH FLOWS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                           Nine Months         Nine Months        June 8, 2004
                                                              Ended               Ended           (Inception)
                                                             June 30,            June 30,           June 30,
                                                               2008                2007               2008
                                                            ---------           ---------           ---------
                                                           <C>                <C>                    <C>
CASH FLOWS FROM OPERATING ACTIVITIES
  Net income (loss)                                         $  (2,217)          $ (34,871)          $(134,371)
  Add item not affecting cash Amortization                        461                  --                 513
  Changes in operating assets and liabilities
    Accounts receivable                                            --                  --                (307)
    Accounts payable and accrued liabilities                  (20,880)             (6,090)              3,561
                                                            ---------           ---------           ---------

Net cash used in continuing operations                        (22,636)            (40,961)           (130,604)

Net cash provided by (used in) discontinued operations             --              10,766            (312,410)
                                                            ---------           ---------           ---------

Net cash provided (used in) operating activities              (22,636)             30,195            (443,014)
                                                            ---------           ---------           ---------
CASH FLOWS FROM FINANCING ACTIVITIES
  Due to related party                                         21,300               5,549             130,543
  Proceeds from sale of Netfone Services Inc.                      --              25,000              25,000
  Proceeds of common stock issuances                               --                  --             291,200
                                                            ---------           ---------           ---------

Net cash provided by financing activities                      21,300              30,549             446,743
                                                            ---------           ---------           ---------
CASH FLOWS FROM INVESTING ACTIVITIES
  Equipment (additions) dispositions                               --              (1,410)             (1,410)
                                                            ---------           ---------           ---------

Net cash from (used) in investing activities                       --              (1,410)             (1,410)
                                                            ---------           ---------           ---------

NET INCREASE (DECREASE) IN CASH                                (1,336)             (1,056)              2,319

CASH, BEGINNING                                                 3,655               7,418                  --
                                                            ---------           ---------           ---------

CASH, ENDING                                                $   2,319           $   6,362           $   2,319
                                                            =========           =========           =========
</TABLE>


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

                                       5
<PAGE>
                                  NETFONE, INC.
                          (A Development Stage Company)
                        NOTE TO THE FINANCIAL STATEMENTS
                                 March 31, 2008
                                   (Unaudited)

Note 1 BASIS OF PRESENTATION

     The accompanying  unaudited interim financial statements have been prepared
     in accordance with United States generally accepted  accounting  principles
     for interim financial information and with the rules and regulations of the
     Securities and Exchange  Commission.  .They do not include all  information
     and  footnotes  required by United  States  generally  accepted  accounting
     principles for complete financial statements.  However, except as disclosed
     herein, there has been no material changes in the information  disclosed in
     the notes to the financial statements for the year ended September 30, 2007
     included  in the  Company's  Annual  Report on Form  10-KSB  filed with the
     Securities  and  Exchange  Commission.   The  unaudited  interim  financial
     statements  should be read in conjunction  with those financial  statements
     included in the Form 10-KSB. In the opinion of management,  all adjustments
     considered  necessary for a fair presentation,  consisting solely of normal
     recurring  adjustments,  have been made.  Operating  results  for the three
     months ended June 30, 2008 are not  necessarily  indicative  of the results
     that may be expected for the year ending September 30, 2008.


                                       6
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

                           FORWARD-LOOKING STATEMENTS

This quarterly report contains forward-looking statements as that term is
defined in the Section 27A of the Securities Act and Section 21E of the
Securities Exchange Act. These statements relate to future events or our future
financial performance. In some cases, you can identify forward-looking
statements by terminology such as "may", "should", "expects", "plans",
"anticipates", "believes", "estimates", "predicts", "potential" or "continue" or
the negative of these terms or other comparable terminology. These statements
are only predictions and involve known and unknown risks, uncertainties and
other factors, including the risks in the section entitled "Risk Factors", that
may cause our or our industry's actual results, levels of activity, performance
or achievements to be materially different from any future results, levels of
activity, performance or achievements expressed or implied by these
forward-looking statements.

Although we believe that the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results, levels of
activity, performance or achievements. Except as required by applicable law,
including the securities laws of the United States, we do not intend to update
any of the forward-looking statements to conform these statements to actual
results.

Our financial statements are stated in United States dollars and are prepared in
accordance with United States Generally Accepted Accounting Principles. In this
quarterly report, unless otherwise specified, all dollar amounts are expressed
in United States dollars. All references to "common shares" refer to shares of
our common stock.

As used in this quarterly report, the terms "we", "us" and "our" means Netfone,
Inc. and our wholly-owned subsidiary, Netfone Services, Inc., prior to its sale
by us, unless otherwise indicated.

GENERAL

We are in the process of developing our virtual calling card and internet fax
offering. We expect that we will be able to offer service toward the end of
2008. We have sold NetFone Services Inc (our wholly-owned Canadian subsidiary
providing internet protocol phone service). We were incorporated in the State of
Nevada on June 8, 2004. From inception of our business on June 8, 2004, we were
engaged in the development of communication technology and services for internet
protocol (IP), telephony and video applications.

The address of our principal executive office is #76017-1358 West Georgia
Street, Vancouver, BC, Canada, V6E 2Y3. Our telephone number is 604-629-9319.

On August 7, 2008 the stockholders' list of our common shares showed 27
registered stockholders and 12,658,000 shares outstanding.

OUR CURRENT BUSINESS

Our management has determined that we will become engaged in the business of
providing facsimilie by e-mail and virtual calling card services. We ceased our
efforts to be a IP Voice Application Service Provider as of March 9, 2007. Our
management has based its decision on the belief that the new direction for our
business will be better for our company.

On January 4, 2007, we entered into two purchase orders: one with Asterisk IT
Pty Ltd., an Australian company, for software and services that will enable us
to offer facsimile by e-mail. The other with Arezqui Belaid, the developer of an
Asterisk-based virtual calling card, for installation and support services.

The first purchase order is for Asterfax, a software application. Using this
software application, users can send and receive faxes using a standard e-mail
account without having to install any software on their computers. The software

                                       7
<PAGE>
simply translates a normal e-mail message into a fax message for sending faxes
and can also translate information back the other way when receiving faxes into
an e-mail message.

 The second purchase order is for the installation and support of a billing
software for calling card and virtual calling card software. The software is
known as Asterisk2Billing. We plan to use the software to offer our future
customers virtual calling cards for both prepaid and post paid telephone calls.
Through Asterisk2Billing, we also obtain user management services, web-based
customer registration services and automatic PIN creation and authentication
services. The system also includes a rating engine with self contained billing,
reporting and statistics functions.

We have agreed to pay Asterisk $1,410 for the installation of the Asterfax
software, the license of the software for one year and one year of e-mail
support from Asterisk. Following the first year, we will be billed $260 per
server per year for e-mail support. Telephone support, if we choose that option
in future, will cost $1,200 per server per year.

We have agreed to pay Arezqui Belaid $450 for the installation of the
Asterisk2billing software and 5 hours of technical support. We will be charged
$50 per hour for additional hours of technical support, if we require them.

The total cost under these purchase orders, except for any additional e-mail or
phone support we may request, is $1,860, of which we have already paid $930. We
intend to pay the remainder upon completion of the installation of the relevant
software onto our servers.

RESULTS OF OPERATIONS

From the date of our incorporation on June 8, 2004 to June 30, 2008, we have
been a development stage company and have generated minimal revenues. In our
most recent quarter we earned $12,000 in consulting revenues.

THREE MONTH PERIOD ENDED JUNE 30, 2008 COMPARED WITH THE THREE MONTH PERIOD
ENDED JUNE 30, 2007.

We posted an operating income of $7,511 for the three month period ended June
30, 2008 compared to operating losses of $22,906 for the three month period
ended June 30, 2007, and operating losses of $134,371 since inception to June
30, 2008. The principal component of the change from losses to income was the
Company earning $12,000 in consulting revenues in the most recent quarter. We do
not anticipate earning additional revenues from its consulting services and
considers the most recent revenues as a one time occurrence.

Our operating expenses for the three month period ended June 30, 2008 compared
to the three month period ended June 30, 2007 are classified primarily into the
following two categories:

     *    Accounting  and  auditing  fees for the year end audit  and  quarterly
          reviews. The amount incurred by our company during for the three month
          period  ended June 30,  2008 was  $2,487,  compared to the three month
          period ended June 30, 2007 of $13,044;
     *    Legal fees. The amount  incurred by our company during the three month
          period ended June 30, 2008 was $1,023 compared to $9,797 for the three
          month period ended June 30, 2007.

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

From inception on June 8, 2004 we have been engaged in the development of
communication technology and services for IP, telephony and video applications.
We primarily focused on the development and sales of voice over internet
protocol (VoIP) services. We have sold NetFone Services Inc (our wholly-owned
Canadian subsidiary providing internet protocol phone service). We are in the
process of developing our virtual calling card and internet fax offering. We
expect that we will be able to offer service toward the end of 2008. Principal
capital resources have been acquired through the issuance of common stock.

At June 30, 2008, we had a working capital deficit of $131,475.

                                       8
<PAGE>
At June 30, 2008, we had assets of $3,523.

At June 30, 2008, our total liabilities were $134,101.

At June 30, 2008 we had cash on hand of $2,319.

PLAN OF OPERATION

We intend to continue the development of our business. Our personnel are
continuously evaluating new opportunities that become available to better our
product offering. This includes:

     *    To develop our new product line focusing on virtual  calling cards and
          internet faxing;
     *    Evaluating internet,  managed IP network and public switched telephone
          network  providers to extend our  services,  better their  quality and
          reduce their cost; and

We anticipate we will require up to $90,000 for the 12 months ending June 30,
2009 to fund our anticipated obligations in respect of our product development
and for our ongoing operational expenses.

DEVELOPMENT AND DEPLOYMENT PLAN

Over the next twelve months, we will be continuously developing and improving
our products. We will:

     *    Bring to general  availability  our virtual  calling card and internet
          faxing products; and
     *    Improve service and introduce new features

EMPLOYEES

As of June 30, 2008, we have no employees.

RESEARCH AND DEVELOPMENT

We did not spend any specific funds on research and development activities
during the quarter ended June 30, 2008, other than expenses that were generally
incurred in the development of our business. We expect that our annual research
and development expenses will increase as we complete work on other products
that are currently in development.

MARKETING AND SALES PLAN

Over the next 12 months, we will continue to develop a sales agent team that
will hopefully drive both direct and indirect sales. Eventually, sales agents
will be managed by regional sale managers. All sale managers and sales agents
will be commission-based independent contractors.

PERSONNEL PLAN

We do not currently plan to add more personnel to our company. As we start
offering service, we will consider outsourcing customer support or hiring
additional personnel.

                                       9
<PAGE>
CASH REQUIREMENTS

Presently, our revenues are not sufficient to meet our operating and capital
expenses. Our management projects that we will require additional funding to
expand our current operations, although we anticipate that our current funds
will enable us to address our minimal current and ongoing expenses and continue
with the marketing and promotion activity connected with the development and
marketing of our virtual calling card and fax products and services throughout
the period ending June 30, 2009.

There is some doubt about our ability to continue as a going concern as the
continuation of our business is dependent upon the successful and sufficient
market acceptance of new virtual calling card and fax products and services, the
continuing successful promotion of our virtual calling card and fax products and
services, obtaining additional financing, and finally, maintaining a break even
or profitable level of operations. The issuance of additional equity securities
by us will result in a dilution in the equity interests of our current
stockholders. Obtaining commercial loans, assuming those loans would be
available, will increase our liabilities and future cash commitments.

We have incurred operating losses since inception. As we had cash on hand of
$2,319 as at June 30, 2008, our management projects that we may require an
additional $90,000 to fund our ongoing operating expenditures, offering expenses
and working capital requirements for the twelve month period ending June 30,
2009, broken down as follows:

 Estimated Funding Required During the Twelve Month Period Ending June 30, 2009

             Operating expenditures
               Marketing & Sales                           $25,000
               General and Administrative                  $15,000
               Product development and deployment          $30,000
               Working capital                             $20,000
                                                           -------

             Total (including Offering Costs)              $90,000
                                                           =======

Due to the uncertainty of our ability to meet our current operating and capital
expenses, in their report on the annual financial statements for the period from
incorporation on June 8, 2004 to September 30, 2007, our independent auditors
included an explanatory paragraph regarding concerns about our ability to
continue as a going concern. Our financial statements contain additional note
disclosures describing the circumstances that lead to this disclosure by our
independent auditors.

We cannot assure you that we will be able to obtain further funds as may be
required for our continued operations. If required, we will pursue various
financing alternatives to meet our immediate and long-term financial
requirements, which we anticipate will consist of further private placements of
equity securities, advances from related parties or stockholder loans. We have
not entered into any definitive agreements with any stockholders or related
parties for the provision of loans or advances. We cannot assure you that
additional financing will be available to us when needed or, if available, that
it can be obtained on commercially reasonable terms. If we are not able to
obtain the additional financing on a timely basis, we will not be able to meet
our other obligations as they become due and we will be forced to scale down or
perhaps even cease our operations.

PURCHASE OF SIGNIFICANT EQUIPMENT

We do not anticipate that we will expend any significant amount on equipment for
our present or future operations.

                                       10
<PAGE>
GOING CONCERN

Due to our being a development stage company and not having generated revenues,
in their report on our financial statements for the period from incorporation on
June 8, 2004 to June 30, 2008, our independent auditors included an explanatory
paragraph regarding concerns about our ability to continue as a going concern.
Our financial statements contain additional note disclosures describing the
circumstances that lead to this disclosure.

We have historically incurred losses, and through June 30, 2008 have incurred
losses of $421,778 from our inception. Because of these historical losses, we
will require additional working capital to develop our business operations. We
intend to raise additional working capital through private placements, public
offerings, bank financing and/or advances from related parties or stockholder
loans.

The continuation of our business is dependent upon obtaining further financing
and achieving a break even or profitable level of operations. The issuance of
additional equity securities by us could result in a significant dilution in the
equity interests of our current or future stockholders. Obtaining commercial
loans, assuming those loans would be available, will increase our liabilities
and future cash commitments.

We cannot assure you that we will be able to either (1) achieve a level of
revenues adequate to generate sufficient cash flow from operations; or (2)
obtain additional financing through either private placements, public offerings
and/or bank financing necessary to support our working capital requirements. To
the extent that funds generated from operations and any private placements,
public offerings and/or bank financing are insufficient, we will have to raise
additional working capital. We cannot assure you that additional financing will
be available, or if available, will be on terms acceptable to us. If adequate
working capital is not available we may not increase our operations.

These conditions raise substantial doubt about our ability to continue as a
going concern. The financial statements do not include any adjustments relating
to the recoverability and classification of asset carrying amounts or the amount
and classification of liabilities that might be necessary should we be unable to
continue as a going concern.

Our activities to date have been supported by equity financing. We have
sustained losses since inception to June 30, 2008 of $421,778. Our management
continues to seek funding from our stockholders and other qualified investors to
pursue our business plan. In the alternative, we may be amenable to a sale,
merger or other acquisition in the event such transaction is deemed by our
management to be in the best interests of the stockholders.

APPLICATION OF CRITICAL ACCOUNTING POLICIES

Our financial statements and accompanying notes are prepared in accordance with
generally accepted accounting principles in the United States. Preparing
financial statements requires our management to make estimates and assumptions
that affect the reported amounts of assets, liabilities, revenue, and expenses.
These estimates and assumptions are affected by our management's application of
accounting policies. We believe that understanding the basis and nature of the
estimates and assumptions involved with the following aspects of our financial
statements is critical to an understanding of our financials.

In preparing financial statements in conformity with generally accepted
accounting principles, our management is required to make estimates and
assumptions that affect the reported amounts of assets and liabilities and the
disclosure of contingent assets and liabilities at the date of the financial
statements and revenues and expenses during the reported period. Actual results
could differ from those estimates.

For purposes of the cash flow statements, we consider all highly liquid
investments with original maturities of three months or less at the time of
purchase to be cash equivalents.

Property and equipment are stated at cost and depreciated using the declining
balance method over estimated economic useful life of 5 years. Maintenance and
repairs are charged to expense as incurred. Major improvements are capitalized.

                                       11
<PAGE>
The carrying amounts of our stockholder loan payable approximate fair value due
to the relatively short period to maturity for this instrument.

We account for income taxes under the Financial Accounting Standards Board
Statement ("FASB") of Financial Accounting Standards ("SFAS") No. 109
"Accounting for Income Taxes" ("SFAS 109"). Under SFAS 109, deferred tax assets
and liabilities are recognized for the future tax consequences attributable to
differences between the financial statement carrying amounts of existing assets
and liabilities and their respective tax bases. Deferred tax assets and
liabilities are measured using enacted tax rates expected to apply to taxable
income in the years in which those temporary differences are expected to be
recovered or settled. Under SFAS 109, the effect on deferred tax assets and
liabilities of a change in tax rates is recognized in income in the period that
includes the enactment date.

We recognize revenue when persuasive evidence of an arrangement exists, delivery
has occurred, the fee is fixed or determinable and collectability is assured. We
recognize revenue from usage, storage and system modifications at the time the
services are performed.

Basic and diluted net loss per common share is computed based upon the weighted
average common shares outstanding as defined by SFAS No. 128, "Earnings Per
Share." As of June 30, 2008 and 2007, there were no common share equivalents
outstanding.

DEVELOPMENT STAGE COMPANY

We comply with SFAS No. 7 and The Securities and Exchange Commission Act Guide 7
for our characterization as development stage.

CAPITAL ASSETS AND AMORTIZATION

Capital assets consist of software and are recorded at cost. Amortization is
provided using the straight-line method over three years, the estimated useful
life of the asset.

IMPAIRMENT OF LONG-LIVED ASSETS

Capital assets are reviewed for impairment in accordance with SFAS No. 144,
"Accounting for the Impairment or Disposal of Long-lived Assets" ("SFAS 144").
Under SFAS 144, these assets are tested for recoverability whenever events or
changes in circumstances indicate that their carrying amounts may not be
recoverable. An impairment charge is recognized for the amount, if any, which
the carrying value of the asset exceeds the fair value.

BASIC LOSS PER SHARE

We report basic loss per share in accordance with SFAS No. 128 "Earnings per
Share". Basic loss per share is computed using the weighted average number of
shares outstanding during the period.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying value of our financial instruments consisting of cash and accounts
payable and accrued liabilities approximate their carrying value due to the
short-term maturity of such instruments. Unless otherwise noted, it is our
management's opinion that we are not exposed to significant interest, currency
or credit risks arising from these financial instruments.

COMPREHENSIVE LOSS

We have adopted SFAS No. 130  "Reporting  Comprehensive  Income".  Comprehensive
loss is comprised of net loss and foreign currency translation adjustments.

                                       12
<PAGE>
RECENT ACCOUNTING PRONOUNCEMENTS

Our management does not believe that any recently issued, but not yet effective
accounting standards if currently adopted could have a material effect on our
financial statements.

RISK FACTORS

Much of the information included in this quarterly report includes or is based
upon estimates, projections or other "forward-looking statements". Such
forward-looking statements include any projections or estimates made by us and
our management in connection with our business operations. While these
forward-looking statements, and any assumptions upon which they are based, are
made in good faith and reflect our current judgment regarding the direction of
our business, actual results will almost always vary, sometimes materially, from
any estimates, predictions, projections, assumptions, or other future
performance suggested herein. We undertake no obligation to update
forward-looking statements to reflect events or circumstances occurring after
the date of such statements.

Such estimates, projections or other "forward-looking statements" involve
various risks and uncertainties as outlined below. We caution readers of this
quarterly report that important factors in some cases have affected and, in the
future, could materially affect actual results and cause actual results to
differ materially from the results expressed in any such estimates, projections
or other "forward-looking statements". In evaluating us, our business and any
investment in our business, readers should carefully consider the following
factors.

RISKS ASSOCIATED WITH OUR BUSINESS

THE FACT THAT WE HAVE NOT EARNED SUBSTANTIAL REVENUES SINCE OUR INCORPORATION
RAISES SUBSTANTIAL DOUBT ABOUT OUR ABILITY TO CONTINUE AS A GOING CONCERN.

We have generated small revenues since our incorporation and we will continue to
incur operating losses for the foreseeable future. We had cash in the amount of
$2,319 as of June 30, 2008. We estimate our average monthly operating expenses
to be approximately $25,000. As a result, we need to generate significant
revenues from our operations or acquire financing. We cannot assure you that we
will be able to successfully explore and develop our business. These
circumstances raise substantial doubt about our ability to continue as a going
concern as described in an explanatory paragraph to our independent auditors'
report on our financial statements for the year ended September 30, 2007.

WE HAVE BEEN UNABLE TO FUND OUR OPERATIONS WITH INTERNALLY GENERATED FUNDS
BECAUSE OUR BUSINESS HAS NOT GENERATED SUBSTANTIAL REVENUE. WITHOUT ADDITIONAL
FINANCING, WE WILL NEED TO GENERATE FUNDS INTERNALLY TO FUND OUR OPERATIONS
DURING THE FISCAL YEAR ENDING SEPTEMBER 30, 2008 OR WE WILL BE UNABLE TO
CONTINUE OUR OPERATIONS AND BUSINESS.

We currently do not have any operations which generate substantial income or
cash flow. We have not generated substantial revenues since our incorporation
and we have required and will continue to require substantial capital to fund
the operation and development of our business (estimated at $150,000 for the 12
month period ending June 30, 2009). We will not generate any material funds
internally in the near future. If we are unable to generate revenue from our
business during the fiscal year ending September 30, 2008, we may be forced to
delay, scale back, or eliminate our sales activities. If any of these actions
were to become necessary, we may not be able to continue to operate our business
and if this event happens, then there is a substantial risk our business would
fail.

WE HAVE NOT GENERATED SUBSTANTIAL REVENUE FROM OUR BUSINESS AND WE MAY NEED TO
RAISE ADDITIONAL FUNDS IN THE NEAR FUTURE. IF WE ARE NOT ABLE TO OBTAIN FUTURE
FINANCING WHEN REQUIRED, WE MIGHT BE FORCED TO DISCONTINUE OUR BUSINESS.

Because we have not generated substantial revenue from our business and we
cannot anticipate when we will be able to generate revenue from our business, we
will need to raise additional funds for the future development of our business
and to respond to unanticipated requirements or expenses. We anticipate that we
will need to raise further financing for the 12 month period ending June 30,

                                       13
<PAGE>
2009 in the approximate amount of $150,000. We do not currently have any
arrangements for financing and we can provide no assurance to investors we will
be able to find such financing if required. The most likely source of future
funds presently available to us is through the sale of equity capital. Any sale
of our capital stock will result in dilution to existing stockholders.
Furthermore, we cannot assure you that we will not incur debt in the future,
that we will have sufficient funds to repay our future indebtedness or that we
will not default on our future debts, jeopardising our business viability.
Finally, we may not be able to borrow or raise additional capital in the future
to meet our needs or to otherwise provide the capital necessary to conduct
business, which might result in the loss of some or all of your investment in
our common stock.

THE LOSS OF RAFEH HULAYS MAY AFFECT OUR ABILITY TO RAISE ADDITIONAL CAPITAL.

Our president, secretary and treasurer, Rafeh Hulays, was instrumental in the
development of our business and the development of our fund raising strategy and
locating the sources of our capital. Our ability to raise additional capital
depends upon the continued service and performance of Mr. Hulays.

BECAUSE OUR OFFICERS, DIRECTORS AND PRINCIPAL STOCKHOLDERS CONTROL A MAJORITY OF
OUR COMMON STOCK, INVESTORS WILL HAVE LITTLE OR NO CONTROL OVER OUR MANAGEMENT
OR OTHER MATTERS REQUIRING STOCKHOLDER APPROVAL.

Our officers and directors, in the aggregate, beneficially own 63.6% of the
issued and outstanding shares of our common stock. As a result, they have the
ability to control matters affecting minority stockholders, including the
election of our directors, the acquisition or disposition of our assets, and the
future issuance of shares of our capital stock. Because our officers, directors
and principal stockholders control our company, investors will not be able to
replace our management if they disagree with the way our business is being run.
Because control by these insiders could result in management making decisions
that are in the best interest of those insiders and not in the best interest of
the investors, you may lose some or all of the value of your investment in our
common stock.

THE VIRTUAL CALLING CARD AND INTERNET FAXING MARKET IS SUBJECT TO RAPID
TECHNOLOGICAL CHANGE AND WE DEPEND ON NEW PRODUCT INTRODUCTION IN ORDER TO
MAINTAIN AND GROW OUR BUSINESS.

The virtual calling card and internet faxing market is characterized by rapid
changes in customer requirements, frequent introductions of new and enhanced
products and services, and continuing and rapid technological advancement. To
compete successfully in this emerging market, we must continue to design,
develop, and sell new and enhanced services that provide increasingly higher
levels of performance and reliability at lower cost. These new and enhanced
products and services must take advantage of technological advancements and
changes, and respond to new customer requirements. Our success in designing,
developing, and selling such products and services will depend on a variety of
factors, including:

     *    the identification of market demand for new products and services;
     *    the scalability of our deployed platforms;
     *    product and feature selection;
     *    timely implementation of product and service offering;
     *    service performance;
     *    cost-effectiveness of service; and;
     *    success of promotional efforts.

We currently deploy software from vendors which we will use to serve virtual
calling card and internet faxing to our customers. Should these vendors fail or
stop adding features to their platform, our ability to effectively compete will
be affected.

Additionally, we may also be required to collaborate with third parties to
deploy services and may not be able to do so on a timely and cost-effective
basis, if at all. We have in the past experienced delays in the deployment of
our services and such delays will likely occur in the future. If we are unable,
due to resource constraints or technological or other reasons, to develop and
introduce new or enhanced services in a timely manner, if such new or enhanced

                                       14
<PAGE>
services do not achieve sufficient market acceptance, or if such new services
introductions decrease demand for existing services, our operating results would
decline and our business would not grow.

DECREASING TELECOMMUNICATIONS RATES MAY DIMINISH OR ELIMINATE OUR COMPETITIVE
PRICING ADVANTAGE.

Decreasing telecommunications rates may diminish or eliminate the competitive
pricing advantage of our services. International and domestic telecommunications
rates have decreased significantly over the last few years in most of the
markets in which we operate, and we anticipate that rates will continue to be
reduced in all of the markets in which we do business or expect to do business.
Users who select our services to take advantage of the current pricing
differential between traditional telecommunications rates and our rates may
switch to traditional telecommunications carriers as such pricing differentials
diminish or disappear, and we will be unable to use such pricing differentials
to attract new customers in the future. In addition, our ability to market our
services to other service providers depends upon the existence of spreads
between the rates offered by us and the rates offered by traditional
telecommunications carriers, as well as a spread between the retail and
wholesale rates charged by the carriers from which we obtain wholesale services.
Continued rate decreases will require us to lower our rates to remain
competitive and will reduce or possibly eliminate our gross profit from our
services. If telecommunications rates continue to decline, we may lose users for
our services.

WE ARE A SMALL COMPANY WITH LIMITED RESOURCES COMPARED TO SOME OF OUR CURRENT
AND POTENTIAL COMPETITORS AND WE MAY NOT BE ABLE TO COMPETE EFFECTIVELY AND
INCREASE MARKET SHARE. ALSO INTENSE COMPETITION IN THE MARKETS IN WHICH WE
COMPETE COULD PREVENT US FROM INCREASING OR SUSTAINING OUR REVENUE AND PREVENT
US FROM ACHIEVING PROFITABILITY.

Most of our current and potential competitors have longer operating histories,
significantly greater resources and name recognition and a larger base of
customers than we have. As a result, these competitors may have greater
credibility with our existing and potential customers. They also may be able to
adopt more aggressive pricing policies and devote greater resources to the
development, promotion and sale of their products than we can to ours. Our
competitors may also offer bundled service arrangements offering a more complete
product despite the technical merits or advantages of our products. These
competitors include calling card companies such as Phonetime and Goldline.

To be competitive, we must continue to invest significant resources in research
and development, sales and marketing, and customer support. We may not have
sufficient resources to make these investments or to make the technological
advances necessary to be competitive, which in turn will cause our business to
suffer and restrict our profitability potential.

OUR SUCCESS DEPENDS ON THIRD PARTIES IN OUR DISTRIBUTION CHANNELS.

We intend to sell our products directly to consumers and through resellers, and
will be focusing efforts on our distribution channels. Our future revenue growth
will depend on large part in sales of our products through reseller and other
distribution relationships. We may not be successful in developing distribution
relationships. Entities that distribute our products may compete with us. In
addition, distributors and resellers may not dedicate sufficient resources or
give sufficient priority to selling our products. Our failure to develop
distribution channels, the loss of a distribution relationship or a decline in
the efforts of a material reseller or distributor could prevent us from
generating sufficient revenues to become profitable.

WE NEED TO RETAIN KEY PERSONNEL TO SUPPORT OUR PRODUCTS AND ONGOING OPERATIONS.

The development and marketing of our virtual calling card and internet faxing
products will continue to place a significant strain on our limited personnel,
management, and other resources. Our future success depends upon the continued
services of our executive officers and contractors who have critical industry
experience and relationships that we rely on to implement our business plan. The
loss of the services of our president Rafeh Hulays and contractors could delay
the development and introduction of, and negatively impact our ability to sell
our products which could adversely affect our financial results and impair our
growth. We currently do not maintain key person life insurance policies on any
of our personnel. We currently hire several contractors including the president

                                       15
<PAGE>
of our company, Rafeh Hulays. We have a consulting agreement with Mr. Hulays,
which is terminable at the will of either party. The agreement is non-exclusive
and, as a result, Mr. Hulays may provide consulting services to other companies,
on the condition that such services do not conflict with the terms of our
consulting agreement. Should Mr. Hulays provide consulting services to another
company, this would detract from the attention paid to our operations and as a
result would slow our product development and marketing efforts.

WE RELY ON THIRD-PARTY COMPANIES PRODUCTS FOR OUR VIRTUAL CALLING CARD AND
INTERNET FAXING SERVICE. THESE INCLUDE THE APPLICATION SERVER. ANY DELAY,
INTERRUPTION OR FINANCIAL DIFFICULTIES BY THESE VENDORS WOULD RESULT IN DELAYED
OR REDUCED SHIPMENTS TO OUR CUSTOMERS AND MAY HARM OUR BUSINESS.

We do not have long-term purchase agreements with any of our suppliers. We
cannot assure you that our suppliers will be able to or willing to reliably
deliver products, in volumes, on a cost-effective basis or in a timely manner.
For our application server software and services, we rely on vendors whose
financial stability or commitment to the service is unknown to us.

WE RELY ON SUBCONTRACTORS FOR THE PROGRAMMING AND MAINTENANCE OF CRITICAL
ELEMENTS OF OUR PRODUCTS AND SERVICES. THIS INCLUDES THE WEB-BASED SERVICE
SIGN-UP INTERFACE, INTEGRATING THE BILLING PROCESS AND THE BASIC MAINTENANCE AND
BACKUP OF OUR SERVERS.

While we perform most of our server maintenance internally, we rely on
subcontractors for tasks such as firewall protection, application of security
patches and regular backup of our servers' data.

Since we do not have long term contracts with these subcontractors with penalty
clauses for non-delivery, there is no assurance that they will continue to
reliably deliver the above services. Should a subcontractor cease to provide
their services to us, our operations will be terminated until such time as we
can locate and retain a replacement subcontractor.

WE RELY ON THIRD PARTY NETWORK SERVICE PROVIDERS TO ORIGINATE AND TERMINATE
SUBSTANTIALLY ALL OF OUR PUBLIC SWITCHED TELEPHONE NETWORK CALLS.

Our service depends on the availability of third party network service providers
that provide telephone numbers and public switched telephone network (PSTN) call
termination and origination services for our customers. Many of these network
service providers have been affected by the downturn in the telecommunications
industry and may be forced to terminate the services that we will depend on. The
time to interface our technology to another network service provider, if
available, and the time to transfer our customer's numbers to the new carrier,
if at all possible may take up to two months, would impair our operations and
ability to generate revenue.

We cannot assure you that any service provider will be able or willing to supply
services to us in the future or that we will be successful in signing up
alternative or additional providers.

IF OUR PRODUCTS AND SERVICES DO NOT INTEROPERATE WITH OUR CUSTOMERS' NETWORKS
AND BACK-END PROCESSES (SUCH AS BILLING SOFTWARE, CUSTOMER SUPPORT SOFTWARE,
MONITORING SOFTWARE), ORDERS FOR OUR PRODUCTS AND SERVICES WILL BE DELAYED OR
CANCELLED, WHICH COULD HARM OUR BUSINESS.

Many of the potential wholesale customers for our service may request that our
products and services be designed to interoperate with their existing networks
and back-end processes, each of which may have different specifications and use
multiple standards. Our customers' networks and back-end processes may contain
multiple generations of products from different vendors that have been added
over time. Our products and services must interoperate with these products as
well as with future products in order to meet our customers' requirements. In
some cases, we may be required to modify our products and services to achieve a
sale, which may result in a longer sales cycle, increased research and
development expense, and reduced operating margins. If our products and services
do not interoperate with existing equipment or software in our customers'
networks, installations could be delayed, or orders for our products and
services could be cancelled.

                                       16
<PAGE>
WE MAY HAVE DIFFICULTY IDENTIFYING THE SOURCE OF THE PROBLEM WHEN THERE IS A
PROBLEM IN A NETWORK.

Our service must successfully integrate with products from other vendors, such
as gateways to traditional telephone systems. As a result, when problems occur
in a network, it may be difficult to identify the source of the problem. The
occurrence of hardware and software errors, whether caused by our service or
another vendor's products, may result in the delay or loss of market acceptance
of our products and any necessary revisions may force us to incur significant
expenses.

IF WE DO NOT DEVELOP AND MAINTAIN SUCCESSFUL PARTNERSHIPS FOR VIRTUAL CALLING
CARD AND INTERNET FAXING PRODUCTS, WE MAY NOT BE ABLE TO SUCCESSFULLY MARKET OUR
SOLUTIONS.

We are entering into new market areas and our success is partly dependent on our
ability to forge new marketing and engineering partnerships. Virtual calling
card and internet faxing systems are extremely complex and few, if any,
companies possess all the required technology components needed to build a
complete end-to-end solution. We will likely need to enter into partnerships to
augment our capabilities and to assist us in marketing complete solutions to our
targeted customers. We may not be able to develop such partnerships in the
course of our product development due to our products not being compatible or
our competitors developing such partnerships before we are able to. Even if we
do establish the necessary partnerships, we may not be able to adequately
capitalize on these partnerships to aid in the success of our business as a
result of any potential conflicts, differing strategies or other difficulties
with such partners. In addition, such partnerships may require minimum financial
commitments on our parts that we may not be able to meet.

THE FAILURE OF IP NETWORKS TO MEET THE RELIABILITY AND QUALITY STANDARDS
REQUIRED FOR VOICE, FAX AND VIDEO COMMUNICATIONS COULD RENDER OUR PRODUCTS
OBSOLETE.

Circuit-switched telephony networks feature very high reliability, with a
guaranteed quality of service. In addition, such networks have imperceptible
delay and consistently satisfactory audio quality. Emerging broadband IP
networks, such as local area networks, wide area networks, and the internet, or
emerging last mile technologies such as cable, digital subscriber lines, and
wireless local loop, may not be suitable for telephony unless such networks and
technologies can provide reliability and quality consistent with these
standards. IP networks do not currently have the same reliability as
circuit-switched telephony networks and may never do so in the foreseeable
future. This is especially true for the public internet which is used by our
subscribers to connect to our service. The public internet suffers from problems
associated with traffic congestion and uneven performance.

FUTURE LEGISLATION OR REGULATION OF THE INTERNET AND/OR VOICE AND/OR FAXING OVER
IP SERVICES COULD RESTRICT OUR BUSINESS, PREVENT US FROM OFFERING SERVICE OR
INCREASE OUR COST OF DOING BUSINESS.

At present there are few laws, regulations or rulings that specifically address
access to or commerce on the internet, including IP telephony. We are unable to
predict the impact, if any, that future legislation, legal decisions or
regulations concerning the internet may have on our business, financial
condition, and results of operations. Regulation may be targeted towards, among
other things, assessing access or settlement charges, imposing taxes related to
internet communications, imposing tariffs or regulations based on encryption
concerns or the characteristics and quality of products and services.

The effects of federal or provincial regulatory actions could have a material
adverse effect on our business, financial condition and operating results.

INTELLECTUAL PROPERTY AND PROPRIETARY RIGHTS OF OTHERS COULD PREVENT US FROM
USING NECESSARY TECHNOLOGY TO PROVIDE VIRTUAL CALLING CARD AND INTERNET FAXING
SERVICES.

While we do not know of any technologies that are patented by others that we
believe are necessary for us to provide our services, certain necessary
technology may in fact be patented by other parties either now or in the future.
If such technology were held under patent by another person, we would have to
negotiate a license for the use of that certain technology. We may not be able
to negotiate such a license at a price that is acceptable. The existence of such

                                       17
<PAGE>
a patent, or our inability to negotiate a license for any such technology on
acceptable terms, could force us to cease using such technology and offering
products and services incorporating such technology.

IF WE DISCOVER PRODUCT DEFECTS, WE MAY HAVE PRODUCT-RELATED LIABILITIES WHICH
MAY CAUSE US TO LOSE REVENUES OR DELAY MARKET ACCEPTANCE OF OUR PRODUCTS.

Products and services as complex as those we will offer frequently contain
errors, defects, and functional limitations when first introduced or as new
versions are released. We have in the past experienced such errors, defects or
functional limitations. We will sell products and services into markets that are
extremely demanding of robust, reliable, fully functional products and services.
Therefore, delivery of products and services with production defects or
reliability, quality or compatibility problems could significantly delay or
hinder market acceptance of such products and services, which could damage our
credibility with our customers and adversely affect our ability to retain our
existing customers and to attract new customers. Moreover, such errors, defects
or functional limitations could cause problems, interruptions, delays or a
cessation of sales to our customers. Alleviating such problems may require
significant expenditures of capital and resources by us. Despite our testing,
our suppliers or our customers may find errors, defects or functional
limitations in new products and services after commencement of commercial
production. This could result in additional development costs, loss of, or
delays in, market acceptance, diversion of technical and other resources from
our other development efforts, product repair or replacement costs, claims by
our customers or others against us, or the loss of credibility with prospective
customers.

RISKS ASSOCIATED WITH OUR COMMON STOCK

TRADING ON THE OTC BULLETIN BOARD MAY BE VOLATILE AND SPORADIC, WHICH COULD
DEPRESS THE MARKET PRICE OF OUR COMMON STOCK AND MAKE IT DIFFICULT FOR OUR
STOCKHOLDERS TO RESELL THEIR SHARES.

Our common stock is quoted on the OTC Bulletin Board. Trading in stock quoted on
the OTC Bulletin Board is often thin and characterized by wide fluctuations in
trading prices, due to many factors that may have little to do with the
company's operations or business prospects. This volatility could depress the
market price of our common stock for reasons unrelated to operating performance.
Moreover, the OTC Bulletin Board is not a stock exchange, and trading of
securities on the OTC Bulletin Board is often more sporadic than the trading of
securities listed on a quotation system like Nasdaq or a stock exchange like the
American Stock Exchange. Accordingly, stockholders may have difficulty reselling
any of the shares.

SALES OF A SUBSTANTIAL NUMBER OF SHARES OF OUR COMMON STOCK INTO THE PUBLIC
MARKET BY STOCKHOLDERS HOLDING REGISTERED STOCK MAY RESULT IN SIGNIFICANT
DOWNWARD PRESSURE ON THE PRICE OF OUR COMMON STOCK AND COULD AFFECT THE ABILITY
OF OUR STOCKHOLDERS TO REALIZE ANY CURRENT TRADING PRICE OF OUR COMMON STOCK.

Sales of a substantial number of shares of our common stock in the public market
could cause a reduction in the market price of our common stock, when and if
such market develops. Pursuant to a previously-filed registration statement that
was declared effective, the selling stockholders for whom we registered shares
of common stock thereby have the ability to sell up to 33% of the issued and
outstanding shares of our common stock. As a result of that registration
statement, a substantial number of our shares of common stock which have been
issued may be available for immediate resale when and if a market develops for
our common stock, which would have the effect of decreasing the price of our
common stock. As a result of any such decreases in price of our common stock,
purchasers who acquire shares from the selling stockholders may lose some or all
of their investment.

Any significant downward pressure on the price of our common stock as the
selling stockholders sell the shares of our common stock could encourage short
sales by the selling stockholders or others. Any such short sales could place
further downward pressure on the price of our common stock, which may result in
the loss of some or all of an investment in our common stock.

                                       18
<PAGE>
OUR STOCK IS A PENNY STOCK. TRADING OF OUR STOCK MAY BE RESTRICTED BY THE SEC'S
PENNY STOCK REGULATIONS AND THE FINANCIAL INDUSTRY REGULATORS AUTHORITY (FINRA)
SALES PRACTICE REQUIREMENTS, WHICH MAY LIMIT A STOCKHOLDER'S ABILITY TO BUY AND
SELL OUR STOCK.

Our stock is a penny stock. The Securities and Exchange Commission has adopted
Rule 15g-9 which generally defines "penny stock" to be any equity security that
has a market price (as defined) less than $5.00 per share or an exercise price
of less than $5.00 per share, subject to certain exceptions. Our securities are
covered by the penny stock rules, which impose additional sales practice
requirements on broker-dealers who sell to persons other than established
customers and "accredited investors". The term "accredited investor" refers
generally to institutions with assets in excess of $5,000,000 or individuals
with a net worth in excess of $1,000,000 or annual income exceeding $200,000 or
$300,000 jointly with their spouse. The penny stock rules require a
broker-dealer, prior to a transaction in a penny stock not otherwise exempt from
the rules, to deliver a standardized risk disclosure document in a form prepared
by the SEC which provides information about penny stocks and the nature and
level of risks in the penny stock market. The broker-dealer also must provide
the customer with current bid and offer quotations for the penny stock, the
compensation of the broker-dealer and its salesperson in the transaction and
monthly account statements showing the market value of each penny stock held in
the customer's account. The bid and offer quotations, and the broker-dealer and
salesperson compensation information, must be given to the customer orally or in
writing prior to effecting the transaction and must be given to the customer in
writing before or with the customer's confirmation. In addition, the penny stock
rules require that prior to a transaction in a penny stock not otherwise exempt
from these rules, the broker-dealer must make a special written determination
that the penny stock is a suitable investment for the purchaser and receive the
purchaser's written agreement to the transaction. These disclosure requirements
may have the effect of reducing the level of trading activity in the secondary
market for the stock that is subject to these penny stock rules. Consequently,
these penny stock rules may affect the ability of broker-dealers to trade our
securities. We believe that the penny stock rules discourage investor interest
in and limit the marketability of our common stock.

In addition to the "penny stock" rules promulgated by the Securities and
Exchange Commission, the FINRA has adopted rules that require that in
recommending an investment to a customer, a broker-dealer must have reasonable
grounds for believing that the investment is suitable for that customer. Prior
to recommending speculative low priced securities to their non-institutional
customers, broker-dealers must make reasonable efforts to obtain information
about the customer's financial status, tax status, investment objectives and
other information. Under interpretations of these rules, FINRA believes that
there is a high probability that speculative low priced securities will not be
suitable for at least some customers. FINRA requirements make it more difficult
for broker-dealers to recommend that their customers buy our common stock, which
may limit your ability to buy and sell our stock.

OTHER RISKS

BECAUSE SOME OF OUR OFFICERS AND DIRECTORS ARE LOCATED IN NON-U.S.
JURISDICTIONS, YOU MAY HAVE NO EFFECTIVE RECOURSE AGAINST OUR MANAGEMENT FOR
MISCONDUCT AND MAY NOT BE ABLE TO ENFORCE JUDGEMENT AND CIVIL LIABILITIES
AGAINST OUR OFFICERS, DIRECTORS, EXPERTS AND AGENTS.

All of our directors and officers are nationals and/or residents of countries
other than the United States, specifically Canada, and all or a substantial
portion of such persons' assets are located outside the United States. As a
result, it may be difficult for investors to enforce within the United States
any judgments obtained against our officers or directors, including judgments
predicated upon the civil liability provisions of the securities laws of the
United States or any state thereof.

ITEM 3A(T). CONTROLS AND PROCEDURES

As required by Rule 13a-15 under the Exchange Act, as of the end of the period
covered by this quarterly report , we have carried out an evaluation of the
effectiveness of the design and operation of our company's disclosure controls
and procedures. This evaluation was carried out under the supervision and with
the participation of our company's management, including our company's president
and chief financial officer. Based upon that evaluation, our company's president
along with our company's chief financial officer concluded that our company's

                                       19
<PAGE>
disclosure controls and procedures are effective as at the end of the period
covered by this report. There have been no changes in our company's internal
controls that occurred during our most recent fiscal quarter that have
materially affected, or are reasonably likely to materially affect our internal
controls subsequent to the date we carried our evaluation.

Disclosure controls and procedures and other procedures that are designed to
ensure that information required to be disclosed in our reports filed or
submitted under the Exchange Act is recorded, processed, summarized and
reported, within the time period specified in the Securities and Exchange
Commission's rules and forms. Disclosure controls and procedures include,
without limitation, controls and procedures designed to ensure that information
required to be disclosed in our reports filed under the Exchange Act is
accumulated and communicated to management, including our president and chief
financial officer as appropriate, to allow timely decisions regarding required
disclosure.

                           PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We know of no material, active or pending legal proceedings against our company,
nor are we involved as a plaintiff in any material proceeding or pending
litigation. There are no proceedings in which any of our directors, officers or
affiliates, or any registered or beneficial stockholder, is an adverse party or
has a material interest adverse to our interest.

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

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

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

None.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

Exhibits Required by Item 601 of Regulation S-B.

(3) CHARTER AND BY-LAWS
3.1   Articles of Incorporation (incorporated by to our Registration Statement
      on Form SB-2 filed December 1, 2004)
3.2   By-laws (incorporated by to our Registration Statement on Form SB-2 filed
      December 1, 2004)

(10) MATERIAL CONTRACTS
10.1  Consulting Agreement dated July 1, 2004 between Rafeh Hulays and Netfone
      Services Inc. (incorporated by to our Registration Statement on Form SB-2
      filed December 1, 2004)
10.2  Form of Subscription Agreement (incorporated by to our Registration
      Statement on Form SB-2 filed December 1, 2004)
10.3  Purchase Order to Asterisk IT Pty Ltd. dated January 4, 2007 (incorporated
      by reference from our current report on Form 8-K filed January 10, 2007)
10.4  Purchase Order to Arezqui Belaid dated January 4, 2007 (incorporated by
      reference from our current report on Form 8-K filed January 10, 2007)

(31) SECTION 302 CERTIFICATIONS
31.1* Certification of Rafeh Hulays

(32) SECTION 906 CERTIFICATIONS
32.1* Certification of Rafeh Hulays

----------
* filed herewith

                                       20
<PAGE>
                                   SIGNATURES

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

NETFONE, INC.


By: /s/ Rafeh Hulays
   ----------------------------------------------------------
   Rafeh Hulays, President, Secretary, Treasurer and Director
   (Principal Executive Officer, Principal Financial
   and Accounting Officer)

Date: August 14, 2008

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