U.S. SECURITIES AND
EXCHANGE COMMISSION
Washington, D.C. 20549

Form 10-KSB


? ANNUAL REPORT PURSUANT TO
SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF
1934

For the fiscal year ended December 31, 2007

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

For the transition period from ______________ to
______________

Commission File Number 000-52849



AFH HOLDING III, INC.
(Exact name of registrant as specified in its charter)



Delaware
26-1365024
(State or other jurisdiction
of
(I.R.S. Employer
incorporation or
organization)
Identification No.)




9595 Wilshire Blvd., Suite
939

Beverly Hills, CA
90212
(Address of principal
executive offices)
(zip code)

Registrant's telephone number, including area code:
(310) 300-3431



Securities registered under Section 12(b) of the
Exchange Act:

None.

Securities registered under Section 12(g) of the
Exchange Act:

Common Stock, $0.001 par value per share
(Title of Class)


Check whether the issuer is not required to file reports
pursuant to Section 13 or 15(d) of the Exchange Act.
?

Check whether the issuer (1) has filed all reports
required to be filed by Section 13 or 15(d) of the
Exchange Act 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 ? No ?.

Check if there is no disclosure of delinquent filers in
response to Item 405 of Regulation S-B (229.405 of
this chapter) contained herein, and no disclosure will
be contained, to the best of registrant's knowledge, in
definitive proxy or information statements
incorporated by reference in Part III of this Form 10-
KSB or any amendment to this Form 10-KSB. ?

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

The issuer's revenues for fiscal year end December 31,
2007 were $0.

As of March 27, 2008, there were 5,000,000 shares of
common stock, par value $.001 per share, outstanding,
none of which were held by non-affiliates.

Transitional Small Business Disclosure Format (check
one): Yes ? No ?

DOCUMENTS INCORPORATED BY
REFERENCE:

None

FORWARD-LOOKING STATEMENTS

Certain statements made in this Annual Report on
Form 10-KSB are "forward-looking statements"
(within the meaning of the Private Securities
Litigation Reform Act of 1995) regarding the plans
and objectives of management for future operations.
Such statements involve known and unknown risks,
uncertainties and other factors that may cause actual
results, performance or achievements of AFH Holding
III, INC. (the "Company") to be materially different
from any future results, performance or achievements
expressed or implied by such forward-looking
statements. The forward-looking statements included
herein are based on current expectations that involve
numerous risks and uncertainties. The Company's
plans and objectives are based, in part, on assumptions
involving the continued expansion of business.
Assumptions relating to the foregoing involve
judgments with respect to, among other things, future
economic, competitive and market conditions and
future business decisions, all of which are difficult or
impossible to predict accurately and many of which
are beyond the control of the Company. Although the
Company believes its assumptions underlying the
forward-looking statements are reasonable, any of the
assumptions could prove inaccurate and, therefore,
there can be no assurance the forward-looking
statements included in this Report will prove to be
accurate. In light of the significant uncertainties
inherent in the forward-looking statements included
herein particularly in view of the current state of our
operations, the inclusion of such information should
not be regarded as a statement by us or any other
person that our objectives and plans will be achieved.
Factors that could cause actual results to differ
materially from those expressed or implied by such
forward-looking statements include, but are not
limited to, the factors set forth herein under the
headings "Business," "Plan of Operation" and "Risk
Factors". We undertake no obligation to revise or
update publicly any forward-looking statements for
any reason.




PART I

Item 1. Description of Business.

Introduction

       AFH HOLDING III, INC. ("we", "us", "our",
the "Company" or the "Registrant") was incorporated
in the State of Delaware on April 16, 2007, and
maintains its principal executive offices at 9595
Wilshire Blvd., Suite 939, Beverly Hills, CA 90212.
Since inception, the Company has been engaged in
organizational efforts and obtaining initial financing.
The Company was formed as a vehicle to pursue a
business combination through the acquisition of, or
merger with, an operating business. The Company
filed a registration statement on Form 10-SB with the
U.S. Securities and Exchange Commission (the
"SEC") on October 5, 2007, and since its
effectiveness, the Company has focused its efforts to
identify a possible business combination.

       The Company, based on proposed business
activities, is a "blank check" company. The SEC
defines those companies as "any development stage
company that is issuing a penny stock, within the
meaning of Section 3(a)(51) of the Securities
Exchange Act of 1934, as amended (the "Exchange
Act"), and that has no specific business plan or
purpose, or has indicated that its business plan is to
merge with an unidentified company or companies."
Many states have enacted statutes, rules and
regulations limiting the sale of securities of "blank
check" companies in their respective jurisdictions. The
Company is also a "shell company," defined in Rule
12b-2 under the Exchange Act as a company with no
or nominal assets (other than cash) and no or nominal
operations. Management does not intend to undertake
any efforts to cause a market to develop in our
securities, either debt or equity, until we have
successfully concluded a business combination. The
Company intends to comply with the periodic
reporting requirements of the Exchange Act for so
long as we are subject to those requirements.

       The Company was organized as a vehicle to
investigate and, if such investigation warrants, acquire
a target company or business seeking the perceived
advantages of being a publicly held corporation. The
Company's principal business objective for the next
12 months and beyond such time will be to achieve
long-term growth potential through a combination
with an operating business. The Company will not
restrict its potential candidate target companies to any
specific business, industry or geographical location
and, thus, may acquire any type of business.

	AFH Holding and Advisory, LLC. ("AFH
Advisory"), the sole stockholder of the Company, has
entered into several letters of intent with target
businesses for the purpose of a business combination.
Presently, AFH Advisory intends to have the
Company acquire one of these target companies,
Fossil Energy Group, Inc. (the "Target Company"),
through a reverse merger or other business
combination pursuant to which the Company would
cease to be a shell company, as defined in the rules of
the SEC (a "Reverse Merger").  However,
circumstances may arise that will result in the
Company not acquiring the Target Company and there
is no assurance that the Company will direct the
Target Company to the Company or that any such
Reverse Merger will be consummated.  If the
Company does not acquire the Target Company, it will
continue to pursue another Reverse Merger.
Competition

       The Company faces vast competition from
other shell companies with the same objectives. The
Company is in a highly competitive market for a small
number of business opportunities which could reduce
the likelihood of consummating a successful business
combination. A large number of established and well-
financed entities, including small public companies
and venture capital firms, are active in mergers and
acquisitions of companies that may be desirable target
candidates for us. Nearly all these entities have
significantly greater financial resources, technical
expertise and managerial capabilities than we do;
consequently, we will be at a competitive disadvantage
in identifying possible business opportunities and
successfully completing a business combination.
These competitive factors may reduce the likelihood
of our identifying and consummating a successful
business combination.
Employees

       We have no employees other than our sole
officer who devotes only a limited amount of time to
our business.

Risk Factors

You should carefully review and consider the
following risks as well as all other information
contained in this Annual Report on Form 10-KSB,
including our financial statements and the notes to
those statements. The following risks and
uncertainties are not the only ones facing us.
Additional risks and uncertainties of which we are
currently unaware or which we believe are not
material also could materially adversely affect our
business, financial condition, results of operations,
or cash flows. To the extent any of the information
contained in this annual report constitutes
forward-looking information, the risk factors set
forth below are cautionary statements identifying
important factors that could cause our actual
results for various financial reporting periods to
differ materially from those expressed in any
forward-looking statements made by or on our
behalf and could materially adversely effect our
financial condition, results of operations or cash
flows.

There may be conflicts of interest as a result of our
management being involved with other blank check
shell companies.

       Conflicts of interest create the risk that
management may have an incentive to act adversely to
the interests of the Company. Our management is
currently involved with other blank check shell
companies, and in the pursuit of business
combinations, conflicts with such other blank check
shell companies with which it is, and may in the future
become, affiliated, may arise. If we and the other
blank check shell companies that our management is
affiliated with desire to take advantage of the same
opportunity, then those members of management that
are affiliated with both companies would abstain from
voting upon the opportunity. In the event of identical
officers and directors, the officers and directors will
arbitrarily determine the company that will be entitled
to proceed with the proposed transaction.

We have a limited operating history.

       We have a limited operating history and no
revenues or earnings from operations since inception.
We have no significant assets or financial resources.
We will, in all likelihood, sustain operating expenses
without corresponding revenues, at least until the
consummation of a merger or other business
combination with a private company. This may result
in our incurring a net operating loss that will increase
unless we consummate a business combination with a
profitable business. We cannot assure you that we can
identify a suitable business opportunity and
consummate a business combination, or that any such
business will be profitable at the time of its acquisition
by us or ever.

We have incurred and may continue to incur losses.

    Since April 16, 2007 (inception) through
December 31, 2007, we have incurred a net loss of
$(7,021). We expect that we will incur losses at least
until we complete a merger or other business
combination with an operating business and perhaps
after such a combination as well. There can be no
assurance that we will complete a merger or other
business combination with an operating business or
that we will ever be profitable.

We face a number of risks associated with potential
acquisitions.

    We intend to use reasonable efforts to complete a
merger or other business combination with an
operating business. Such combination will be
accompanied by risks commonly encountered in
acquisitions, including, but not limited to, difficulties
in integrating the operations, technologies, products
and personnel of the acquired companies and
insufficient revenues to offset increased expenses
associated with acquisitions. Failure to manage and
successfully integrate acquisitions we make could
harm our business, our strategy and our operating
results in a material way.

There is competition for those private companies
suitable for a merger transaction of the type
contemplated by management.

       The Company is in a highly competitive
market for a small number of business opportunities
which could reduce the likelihood of consummating a
successful business combination. We are, and will
continue to be, an insignificant participant in the
business of seeking mergers with, joint ventures with
and acquisitions of small private and public entities. A
large number of established and well-financed entities,
including small public companies and venture capital
firms, are active in mergers and acquisitions of
companies that may be desirable target candidates for
us. Nearly all these entities have significantly greater
financial resources, technical expertise and managerial
capabilities than we do; consequently, we will be at a
competitive disadvantage in identifying possible
business opportunities and successfully completing a
business combination. These competitive factors may
reduce the likelihood of our identifying and
consummating a successful business combination.

Future success is highly dependent on the ability of
management to locate and attract a suitable
acquisition.

       The nature of our operations is highly
speculative, and there is a consequent risk of loss of
your investment. The success of our plan of operation
will depend to a great extent on the operations,
financial condition and management of the identified
business opportunity. While management intends to
seek business combination(s) with entities having
established operating histories, we cannot assure you
that we will be successful in locating candidates
meeting that criterion. In the event we complete a
business combination, the success of our operations
may be dependent upon management of the successor
firm or venture partner firm and numerous other
factors beyond our control.

Management intends to devote only a limited amount
of time to seeking a target company which may
adversely impact our ability to identify a suitable
acquisition candidate.

       While seeking a business combination,
management anticipates devoting very limited time to
the Company's affairs. Our sole officer has not entered
into a written employment agreement with us and is
not expected to do so in the foreseeable future. This
limited commitment may adversely impact our ability
to identify and consummate a successful business
combination.

There can be no assurance that the Company will
successfully consummate a business combination.

       We can give no assurances that we will
successfully identify and evaluate suitable business
opportunities or that we will conclude a business
combination. Management has not identified any
particular industry or specific business within an
industry for evaluation. We cannot guarantee that we
will be able to negotiate a business combination on
favorable terms.

The time and cost of preparing a private company to
become a public reporting company may preclude us
from entering into a merger or acquisition with the
most attractive private companies.

       Target companies that fail to comply with
SEC reporting requirements may delay or preclude
acquisition. Sections 13 and 15(d) of the Exchange
Act require reporting companies to provide certain
information about significant acquisitions, including
certified financial statements for the company
acquired, covering one, two, or three years, depending
on the relative size of the acquisition. The time and
additional costs that may be incurred by some target
entities to prepare these statements may significantly
delay or essentially preclude consummation of an
acquisition. Otherwise suitable acquisition prospects
that do not have or are unable to obtain the required
audited statements may be inappropriate for
acquisition so long as the reporting requirements of
the Exchange Act are applicable.
The Company may be subject to further government
regulation which would adversely affect our
operations.

       Although we are subject to the reporting
requirements under the Exchange Act, management
believes we are not subject to regulation under the
Investment Company Act of 1940, as amended (the
"Investment Company Act"), since we are not engaged
in the business of investing or trading in securities. If
we engage in business combinations which result in
our holding passive investment interests in a number
of entities, we could be subject to regulation under the
Investment Company Act. If so, we would be required
to register as an investment company and could be
expected to incur significant registration and
compliance costs. We have obtained no formal
determination from the SEC as to our status under the
Investment Company Act and, consequently, violation
of the Investment Company Act could subject us to
material adverse consequences.

Any potential acquisition or merger with a foreign
company may subject us to additional risks.

       If we enter into a business combination with a
foreign company, we will be subject to risks inherent
in business operations outside of the United States.
These risks include, for example, currency
fluctuations, regulatory problems, punitive tariffs,
unstable local tax policies, trade embargoes, risks
related to shipment of raw materials and finished
goods across national borders and cultural and
language differences. Foreign economies may differ
favorably or unfavorably from the United States
economy in growth of gross national product, rate of
inflation, market development, rate of savings, and
capital investment, resource self-sufficiency and
balance of payments positions, and in other respects.

The Company may be subject to certain tax
consequences in our business, which may increase
our cost of doing business.

       We may not be able to structure our
acquisition to result in tax-free treatment for the
companies or their stockholders, which could deter
third parties from entering into certain business
combinations with us or result in being taxed on
consideration received in a transaction. Currently, a
transaction may be structured so as to result in tax-free
treatment to both companies, as prescribed by various
federal and state tax provisions. We intend to structure
any business combination so as to minimize the
federal and state tax consequences to both us and the
target entity; however, we cannot guarantee that the
business combination will meet the statutory
requirements of a tax-free reorganization or that the
parties will obtain the intended tax-free treatment upon
a transfer of stock or assets. A non-qualifying
reorganization could result in the imposition of both
federal and state taxes that may have an adverse effect
on both parties to the transaction.

Our business will have no revenue unless and until
we merge with or acquire an operating business.

       We are a development stage company and
have had no revenue from operations. We do not
expect to realize any revenue unless and until we
successfully merge with or acquire an operating
business.

Because we may seek to complete a business
combination through a "reverse merger", following
such a transaction we may not be able to attract the
attention of major brokerage firms.

	Additional risks may exist since we expect to
assist a privately held business to become public
through a "reverse merger." Securities analysts of
major brokerage firms may not provide coverage of
our Company since there is no incentive to brokerage
firms to recommend the purchase of common stock,
par value $0.001 per share (the "Common Stock"). No
assurance can be given that brokerage firms will want
to conduct any secondary offerings on behalf of our
post-merger company in the future.

We cannot assure you that following a business
combination with an operating business, our
Common Stock will be listed on NASDAQ or any
other securities exchange.

       Following a business combination, we may
seek the listing of Common Stock on NASDAQ or the
American Stock Exchange. However, we cannot
assure you that following such a transaction, we will
be able to meet the initial listing standards of either of
those or any other stock exchange, or that we will be
able to maintain a listing of Common Stock on either
of those or any other stock exchange. After completing
a business combination, until the Common Stock is
listed on the NASDAQ or another stock exchange, we
expect that the Common Stock would be eligible to
trade on the OTC Bulletin Board, another over-the-
counter quotation system, or on the "pink sheets,"
where our stockholders may find it more difficult to
dispose of shares or obtain accurate quotations as to
the market value of the Common Stock. In addition,
we would be subject to an SEC rule that, if it failed to
meet the criteria set forth in such rule, imposes various
practice requirements on broker-dealers who sell
securities governed by the rule to persons other than
established customers and accredited investors.
Consequently, such rule may deter broker-dealers
from recommending or selling the Common Stock,
which may further affect its liquidity. This would also
make it more difficult for us to raise additional capital
following a business combination.

Our sole stockholder may have a minority interest in
the Company following a merger or other business
combination with an operating business.

	If we consummate a merger or business
combination with a company with a value in excess of
the value of our Company and issue shares of
Common Stock to the stockholders of such company
as consideration for merging with us, our sole
stockholder would own less than 50% of the Company
after the business combination. The stockholders of
the acquired company would therefore be able to
control the election of our Board of Directors and
control our Company.

There is currently no trading market for our
Common Stock, and liquidity of shares of our
Common Stock is limited.
     Our shares of Common Stock are not registered
under the securities laws of any state or other
jurisdiction, and accordingly there is no public trading
market for our Common Stock. Further, no public
trading market is expected to develop in the
foreseeable future unless and until the Company
completes a business combination with an operating
business and the Company thereafter files a
registration statement under the Securities Act of
1933, as amended (the "Securities Act"). Therefore,
outstanding shares of our Common Stock cannot be
offered, sold, pledged or otherwise transferred unless
subsequently registered pursuant to, or exempt from
registration under, the Securities Act and any other
applicable federal or state securities laws or
regulations. Shares of our Common Stock cannot be
sold under the exemptions from registration provided
by Rule 144 or under Section 4(1) of the Securities
Act, in accordance with the letter from Richard K.
Wulff, Chief of the Office of Small Business Policy of
the Securities and Exchange Commission's Division of
Corporation Finance, to Ken Worm of NASD
Regulation, dated January 21, 2000 (the "Wulff
Letter).  The Wulff Letter provides that certain private
transfers of the shares also may be prohibited without
registration under federal securities laws. Compliance
with the criteria for securing exemptions under federal
securities laws and the securities laws of the various
states is extremely complex, especially in respect of
those exemptions affording flexibility and the
elimination of trading restrictions in respect of
securities received in exempt transactions and
subsequently disposed of without registration under
the Securities Act or state securities laws.  The SEC
changed certain aspects of the Wulff Letter and such
changes apply retroactively to our stockholder.  Since
February 15, 2008, all holders of shares of shares of
common stock of  "shell company" have been
permitted to sell their shars of common stock under
Rule 144, subject to certain restrictions, starting one
year after (i) the completion of a business combination
with a private company in  a reverse merger or reverse
takeover transaction after which the company would
cease to be a "shell company" as defined in Rule 12b-
2 under the Exchange Act) and (ii) the disclosure of
certain information on  a Current Report on Form 8-K
within four business days thereafter.  affording
flexibility and the elimination of trading restrictions in
respect of securities received in exempt transactions
and subsequently disposed of without registration
under the Securities Act or state securities laws.
affording flexibility and the elimination of trading
restrictions in respect of securities received in exempt
transactions and subsequently disposed of without
registration under the Securities Act or state securities
laws.
There are issues impacting liquidity of our securities
with respect to the SEC's review of a future resale
registration statement.

       Since shares of our Common Stock issued
prior to a business combination or reverse merger
cannot currently, nor will they for a considerable
period of time after we complete a business
combination, be available to be offered, sold, pledged
or otherwise transferred without being registered
pursuant to the Securities Act, we will likely file a
resale registration statement on Form S-1, or some
other available form, to register for resale such shares
of Common Stock. We cannot control this future
registration process in all respects as some matters are
outside our control. Even if we are successful in
causing the effectiveness of the resale registration
statement, there can be no assurances that the
occurrence of subsequent events may not preclude our
ability to maintain the effectiveness of the registration
statement. Any of the foregoing items could have
adverse effects on the liquidity of our shares of
Common Stock.

       In addition, the SEC has recently disclosed
that it has developed internal informal guidelines
concerning the use of a resale registration statement to
register the securities issued to certain investors in
private investment in public equity (PIPE)
transactions, where the issuer has a market
capitalization of less than $75 million and, in general,
does not qualify to file a Registration Statement on
Form S-3 to register its securities if the issuer's
securities are listed on the OTCBB or Pink Sheets.
The SEC has taken the position that these smaller
issuers may not be able to rely on Rule 415 under the
Securities Act ("Rule 415"), which generally permits
the offer and sale of securities on a continued or
delayed basis over a period of time, but instead would
require that the issuer offer and sell such securities in a
direct or "primary" public offering, at a fixed price, if
the facts and circumstances are such that the SEC
believes the investors seeking to have their shares
registered are underwriters and/or affiliates of the
issuer. It appears that the SEC in most cases will
permit a registration for resale of up to one third of the
total number of shares of common stock then currently
owned by persons who are not affiliates of such issuer
and, in some cases, a larger percentage depending on
the facts and circumstances. Staff members also have
indicated that an issuer in most cases will have to wait
until the later of six months after effectiveness of the
first registration or such time as substantially all
securities registered in the first registration are sold
before filing a subsequent registration on behalf of the
same investors. Since, following a reverse merger or
business combination, we may have little or no
tradable shares of Common Stock, it is unclear as to
how many, if any, shares of Common Stock the SEC
will permit us to register for resale, but SEC staff
members have indicated a willingness to consider a
higher percentage in connection with registrations
following reverse mergers with shell companies such
as the Company. The SEC may require as a condition
to the declaration of effectiveness of a resale
registration statement that we reduce or "cut back" the
number of shares of common stock to be registered in
such registration statement. The result of the foregoing
is that a stockholder's liquidity in Common Stock may
be adversely affected in the event the SEC requires a
cut back of the securities as a condition to allow the
Company to rely on Rule 415 with respect to a resale
registration statement, or, if the SEC requires us to file
a primary registration statement.

We have never paid dividends on our Common Stock.

	We have never paid dividends on our
Common Stock and do not presently intend to pay any
dividends in the foreseeable future. We anticipate that
any funds available for payment of dividends will be
re-invested into the Company to further its business
strategy.

The Company intends to issue more shares in a
merger or acquisition, which will result in
substantial dilution.

       Our Certificate of Incorporation authorizes
the issuance of a maximum of 100,000,000 shares of
Common Stock and a maximum of 20,000,000 shares
of preferred stock, par value $.001 per share (the
"Preferred Stock"). Any merger or acquisition effected
by us may result in the issuance of additional
securities without stockholder approval and the
substantial dilution in the percentage of Common
Stock held by our then existing stockholders.
Moreover, the Common Stock issued in any such
merger or acquisition transaction may be valued on an
arbitrary or non-arm's-length basis by our
management, resulting in an additional reduction in
the percentage of Common Stock held by our current
stockholder. 	Our Board of Directors has the
power to issue any or all of such authorized but
unissued shares without stockholder approval. To the
extent that additional shares of Common Stock or
Preferred Stock are issued in connection with a
business combination or otherwise, dilution to the
interests of our stockholder will occur and the rights of
the holder of Common Stock might be materially and
adversely affected.

Our sole stockholder may engage in a transaction to
cause the Company to repurchase its shares of
Common Stock.

       In order to provide an interest in the
Company to a third party, our sole stockholder may
choose to cause the Company to sell Company
securities to third parties, with the proceeds of such
sale being utilized by the Company to repurchase its
shares of Common Stock. As a result of such
transaction, our management, stockholder(s) and
Board of Directors may change.

Our Board of Directors has the power to issue shares
of Preferred Stock with certain rights without
stockholder approval.

       Our Certificate of Incorporation authorizes
the issuance of up to 20,000,000 shares of Preferred
Stock with designations, rights and preferences
determined from time to time by its Board of
Directors. Accordingly, our Board of Directors is
empowered, without stockholder approval, to issue
shares of Preferred Stock with dividend, liquidation,
conversion, voting, or other rights which could
adversely affect the voting power or other rights of the
holders of the Common Stock. In the event of
issuance, the Preferred Stock could be utilized, under
certain circumstances, as a method of discouraging,
delaying or preventing a change in control of the
Company. Although we have no present intention to
issue any shares of our authorized Preferred Stock,
there can be no assurance that we will not do so in the
future.

Control by Amir F. Heshmatpour

       Our sole stockholder is AFH Holding &
Advisory, LLC, which is controlled by Amir F.
Heshmatpour, who is also our sole officer and director.
AFH Holding & Advisory, LLC currently owns all of
the issued and outstanding capital stock of the
Company. Consequently, this stockholder controls the
operations of the Company and will have the ability to
control all matters submitted to stockholders for
approval, including:


*
Election of the board of directors;


*
Removal of any directors;


*
Amendment of the Company's
certificate of incorporation or
bylaws; and


*
Adoption of measures that could
delay or prevent a change in control
or impede a merger, takeover or
other business combination.

       This stockholder will thus have complete
control over our management and affairs. Accordingly,
this ownership may have the effect of impeding a
merger, consolidation, takeover or other business
consolidation, or discouraging a potential acquirer
from making a tender offer for our common stock.

Item 2. Description of Property.

	The Company neither rents nor owns any
properties. The Company utilizes the office space and
equipment of its sole officer and director at no cost.
Management estimates such amounts to be immaterial.
The Company currently has no policy with respect to
investments or interests in real estate, real estate
mortgages or securities of, or interests in, persons
primarily engaged in real estate activities.

Item 3. Legal Proceedings.

       Presently, there are not any material pending
legal proceedings to which the Company is a party or
as to which any of its property is subject, and no such
proceedings are known to the Company to be
threatened or contemplated against it.

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

       None.

PART II

Item 5. Market for Common Equity, Related
Stockholder Matters and Small Business Issuer
Purchases of Equity Securities.

Common Stock

       Our Certificate of Incorporation authorizes
the issuance of up to 100,000,000 shares of Common
Stock. Our Common Stock is not listed on a publicly-
traded market. As of March 27, 2008, there was one
holder of record of our Common Stock.

Preferred Stock

       Our Certificate of Incorporation authorizes
the issuance of up to 20,000,000 shares of Preferred
Stock. The Company has not yet issued any of the
Preferred Stock.

Dividend Policy

       The Company has not declared or paid any
cash dividends on Common Stock and does not intend
to declare or pay any cash dividend in the foreseeable
future. The payment of dividends, if any, is within the
discretion of the Board of Directors and will depend
on the Company's earnings, if any, its capital
requirements and financial condition and such other
factors as the Board of Directors may consider.

Securities Authorized for Issuance Under Equity
Compensation Plans

None.

 Recent Sales of Unregistered Securities

       The Company did not sell any equity
securities that were not registered under the Securities
Act during the period covered by this Annual Report.

       On  April 16, 2007, the Company issued
5,000,000 shares of Common Stock to AFH Holding
& Advisory, LLC., which is controlled by our sole
officer and director, Amir F. Heshmatpour, for an
aggregate purchase price equal to $5,000.00. The
Company sold these shares of Common Stock under
the exemption from registration provided by Section
4(2) of the Securities Act.

       No securities have been issued for services.
Neither the Company nor any person acting on its
behalf offered or sold the securities by means of any
form of general solicitation or general advertising. No
services were performed by any purchaser as
consideration for the shares issued.


Private Placement Offering
	In February 2008, the Company commenced
a private placement (the "Offering") of shares (the
"Shares") of Common Stock on a best efforts basis
with expected gross proceeds of up to $700,000.   The
Company is offering 350,000 shares of Common
Stock at a purchase price equal to $2.00 per share.
The Shares are expected to be issued to accredited
investors under an exemption from the registration
requirements of the Securities Act, and any investors
would be prohibited from offering or selling the
Shares purchased in the Offering in the absence of an
effective registration statement or an applicable
exemption from registration requirements.  As of the
date of this report, the Offering has not closed.
       This Report is issued pursuant to Rule 135c
under the Securities Act and shall not constitute an
offer to sell or the solicitation of an offer to buy the
Shares, nor shall there be any sale of the Shares in any
state in which such offer, solicitation or sale would be
unlawful prior to the registration or qualification under
the securities laws of any such state.
Item 6. Management's Discussion and Analysis or
Plan of Operation.

 Plan of Operation

       The Company has not realized any revenues
from operations since inception, and its plan of
operation for the next twelve months is to locate a
suitable acquisition or merger candidate and
consummate a business combination. The Company
may need additional cash advances from its
stockholder or loans from other parties to pay for
operating expenses until the Company consummates a
merger or business combination with a privately-held
operating company. Although it is currently
anticipated that the Company can satisfy its cash
requirements with additional cash advances or loans
from other parties, if needed, for at least the next
twelve months, the Company can provide no assurance
that it can continue to satisfy its cash requirements for
such period.

       Since our formation on April 16, 2007, our
purpose has been to effect a business combination with
an operating business which we believe has significant
growth potential. We are currently considered to be a
"blank check" company in as much as we have no
specific business plans, no operations, revenues or
employees. We currently have no definitive
agreements or understanding with any prospective
business combination candidates and have not targeted
any business for investigation and evaluation nor are
there any assurances that we will find a suitable
business with which to combine. The implementation
of our business objectives is wholly contingent upon a
business combination and/or the successful sale of
securities in the company.

       As a result of our limited resources, we
expect to effect only a single business combination.
Accordingly, the prospects for our success will be
entirely dependent upon the future performance of a
single business. Unlike certain entities that have the
resources to consummate several business
combinations or entities operating in multiple
industries or multiple segments of a single industry,
we will not have the resources to diversify our
operations or benefit from the possible spreading of
risks or offsetting of losses. A target business may be
dependent upon the development or market acceptance
of a single or limited number of products, processes or
services, in which case there will be an even higher
risk that the target business will not prove to be
commercially viable.

       Our sole officer is only required to devote a
very limited portion of his time to our affairs on a part-
time or as-needed basis. We expect to use outside
consultants, advisors, attorneys and accountants as
necessary, none of which will be hired on a retainer
basis. We do not anticipate hiring any full-time
employees so long as we are seeking and evaluating
business opportunities.

       We expect our present management to play
no managerial role in the Company following a merger
or business combination. Although we intend to
scrutinize closely the management of a prospective
target business in connection with our evaluation of a
business combination with a target business, our
assessment of management may be incorrect. We
cannot assure you that we will find a suitable business
with which to combine.

Results of Operations

       The Company has not conducted any active
operations since inception, except for its efforts to
locate a suitable acquisition or merger transaction. No
revenue has been generated by the Company during
such period, and it is unlikely the Company will have
any revenues unless it is able to effect an acquisition
of or merger with another operating company, of
which there can be no assurance.

Off-Balance Sheet Arrangements

	The Company does not have any off-balance
sheet arrangements that have or are reasonably likely
to have a current or future effect on the Company's
financial condition, changes in financial condition,
revenues or expenses, results of operations, liquidity,
capital expenditures or capital resources that is
material to investors.





































Item 7. Financial Statements.

AFH HOLDING III, INC.
(A Development Stage Company)
December 31, 2007

- TABLE OF CONTENTS -




Page(s)




Financial Statements:







Report of Independent Registered Public
Accounting Firm

14





Balance Sheet as of December 31, 2007

15





StStatement of Operations for the Period from
April 16, 2007 (Inception) through December
31, 2007

16





StStatement of Changes in Stockholder's
Equity for the Period from April 16, 2007
(Inception) through December 31, 2007

17





StStatement of Cash Flows for the Period from
April 16, 2007 (Inception) through December
31, 2007

18




Notes to Financial Statements

19-25























REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM

To the Board of Directors and Stockholders of
AFH Holding III, Inc.
Beverly Hills, California


       We have audited the accompanying balance sheet
of AFH Holding III, Inc. (A Development Stage
Company) as of December 31, 2007, and the related
statements of operations, changes in stockholder's
equity, and cash flows for the period from inception,
April 16, 2007, through December 31, 2007. AFH
Holding III, Inc.'s management is responsible for
these financial statements. Our responsibility is to
express an opinion on these financial statements based
on our audit.

       We conducted our audit in accordance with the
standards of the Public Company Accounting
Oversight Board (United States). Those standards
require that we plan and perform the audit to obtain
reasonable assurance about whether the financial
statements are free of material misstatement. The
company is not required to have, nor were we engaged
to perform, an audit of its internal control over
financial reporting. Our audit included consideration
of internal control over financial reporting as a basis
for designing audit procedures that are appropriate in
the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the
company's internal control over financial reporting.
Accordingly, we express no such opinion. An audit
also includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used
and significant estimates made by management, as
well as evaluating the overall financial statement
presentation. We believe that our audit provides 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 AFH Holding III, Inc. (A
Development Stage Company) as of December 31,
2007 and the results of its operations and its cash
flows for the period from inception, April 16, 2007,
through December 31, 2007, 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 3 to
the financial statements, the Company has incurred
losses resulting in an accumulated deficit. This
condition raises substantial doubt about its ability to
continue as a going concern. The financial statements
do not include any adjustments that might result from
the outcome of this uncertainty.





Rochester, New York
  April 1, 2008













AFH HOLDING III, INC.
(A Development Stage Company)
Balance Sheet
December 31, 2007



December
31, 2007












ASSETS











 Total assets

$
-








LIABILITIES AND
STOCKHOLDER'S EQUITY











Commitment and contingencies

$
-








Stockholder's equity


-


Preferred stock, $.001 par value,





 authorized 20,000,000 shares,
none issued





Common stock, $.001 par value,





 authorized 100,000,000 shares,


5,000


 5,000,000 issued and outstanding





Additional paid in capital


2,021


Deficit accumulated during the
development stage


(7,021)








 Total stockholder's equity











 Total liabilities and stockholder's
equity


-










$
-


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

















AFH HOLDING III, INC.
(A Development Stage Company)
Statements of Operations




Period
from




April 16,
2007




(Inception)




Through




December
31, 2007






Net Sales


$
-







Cost of Sales



-







Gross Profit



-







General and
Administrative
Expenses



(7021
)






Net (Loss)


$
(7,021
)






Basic and Diluted
(Loss) Per Share



(.00)







Basic and Diluted





WWeighted Average
Number of Common
Shares Outstanding



5,000,000


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




















AFH HOLDING III, INC.
(A Development Stage Company)
Statements of Changes in Stockholder's Equity
For the Period April 16, 2007 (Inception) through
December 31, 2007

, ,  ,  , Additional Paid-in Capital , Deficit accumulated ,
Total
, , Common Stock , , ,
, , Shares , Amount , , ,
Issuance of Common Stock , , , , , , ,
Balance April 16, 2007, , 0, 0, 0, 0, , 0
Shares issued in Lieu of expenses paid , , 5,000,000,
$5,000.00, $0.00, $0.00, , $5,000.00
, , , , , , ,
Net Loss , , , , , (7021), ,         (7021)
Contributed Capital for Services, , , , 2021, , , 2021
Balance at December 31, 2007, , 5,000,000,
$5,000.00, 2021, ($7021), , 0.00
, , , , , , ,























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







AFH HOLDING III, INC.
(A Development Stage Company)
Statements of Cash Flows




Period
from




April 16,
2007




(Inception)




Through




December
31,
2007

Cash Flows from
Operating Activities









Net (loss)


$
(7.021
)






Contributed Capital
For Services



2021







   Shares issued in lieu
of expenses paid



5000







Cash flows used in
operating activities



-0-







Net increase in cash



-







Cash, beginning of
period



-







Cash, end of period



-







Supplemental
Disclosure of Cash
Flow Information:





Cash paid during the
period for:





Interest


$
-

Income taxes







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













AFH HOLDING III, INC.
(A Development Stage Company)
Notes to Financial Statements
December 31, 2007

Note 1 - Development Stage Company:

AFH HOLDING III, INC., a development stage
company (the "Company"), was incorporated in the
State of Delaware on April 16, 2007. The Company is
100% owned by AFH Holding and Advisory, LLC.
The financial statements presented represent only
those transaction of AFH Holding III, Inc. The
Company is looking to acquire an existing company or
acquire the technology to begin operations.

Note 2 - Summary of Significant Accounting
Policies:

The accompanying financial statements are prepared
in accordance with accounting principles generally
accepted in the United States. Significant accounting
policies follow:

Use of Estimates: The preparation of the financial
statements in conformity with accounting principles
generally accepted in the United States of America
requires management to make estimates and
assumptions that affect the amounts of assets and
liabilities and disclosure of contingent assets and
liabilities at the date of the balance sheet and reported
amounts of revenues and expenses during the
reporting period. Actual results could differ from those
estimates.

Income Taxes: The Company utilizes the liability
method of accounting for income taxes. Under the
liability method, deferred tax assets and liabilities are
determined based on the differences between financial
reporting basis and tax basis of the assets and
liabilities and are measured using enacted tax rates that
will be in effect when the differences are expected to
reverse. An allowance against deferred tax assets is
recognized, when it is more likely than not, that such
tax benefits will not be realized.

Loss per Common Share: Basic loss per share is
calculated using the weighted-average number of
common shares outstanding during each period.
Diluted loss per share includes potentially dilutive
securities such as outstanding options and warrants,
using various methods such as the treasury stock or
modified treasury stock method in the determination
of dilutive shares outstanding during each period. The
Company does not have any potentially dilutive
instruments.

Fair Value of Financial Instruments: The carrying
value of current assets and liabilities approximate fair
value due to their short term nature.

New Accounting Pronouncements:

    In June 2006, the FASB issued FIN 48,
Accounting for Uncertainty in Income Taxes-an
Interpretation of FASB Statement No. 109.  This
interpretation clarifies the accounting for uncertainty
in income taxes recognized in an enterprise's financial
statements. This interpretation prescribes a recognition
threshold and measurement attribute for the financial
statement recognition and measurement of a tax
position taken or expected to be taken in a tax return.
This Interpretation also provides guidance on
derecognition, classification, interest and penalties,
accounting in interim periods, disclosure, and
transition.  FIN 48 is effective for fiscal years
beginning after December 15, 2006.  As such, the
Company adopted these provisions at the beginning of
the fiscal year ended December 31, 2007.  Adoption of
FIN 48 did not have a significant effect on the
Company's financial statements.




AFH HOLDING III, INC.
(A Development Stage Company)
Notes to Financial Statements
December 31, 2007

Note 2 - Summary of Significant Accounting
Policies (Cont'd):

New Accounting Pronouncements (Cont'd):

In September 2006, the Financial Accounting
Standards Board issued Statement of Financial
Accounting Standards No. 157 ("FAS 157"), Fair
Value Measurements, which defines fair value,
establishes a framework for measuring fair value in
generally accepted accounting principles ("GAAP"),
and expands disclosures about fair value
measurements. FAS 157 applies under other
accounting pronouncements that require or permit fair
value measurements. Prior to FAS 157, there were
different definitions of fair value and limited guidance
for applying those definitions in GAAP. Moreover,
that guidance was dispersed among the many
accounting pronouncements that require fair value
measurements. Differences in that guidance created
inconsistencies that added to the complexity in
applying GAAP. The changes to current practice
resulting from the application of FAS 157 relate to the
definition of fair value, the methods used to measure
fair value, and the expanded disclosures about fair
value measurements. FAS 157 is effective for financial
statements issued for fiscal years beginning after
November 15, 2007, and interim periods within those
fiscal years. The Company presently does not expect
the adoption of FAS 157 to have an effect on its
financial statements.

In February 2007, the Financial Accounting Standards
Board issued Statement of Financial Accounting
Standards No. 159 ("FAS 159"), The Fair Value
Option for Financial Assets and Financial Liabilities,
which permits entities to choose to measure many
financial instruments and certain other items at fair
value which are not currently required to be measured
at fair value. FAS 159 is effective for financial
statements issued for fiscal years beginning after
November 15, 2007, and interim periods within those
fiscal years. The Company presently does not expect
the adoption of FAS 159 to have an effect on its
financial statements.

In December 2007, the Financial Accounting
Standards Board issued Statement of Financial
Accounting Standards No. 141R ("FAS 141R"),
Business Combinations, which establishes principles
and requirements for how the acquirer recognizes and
measures in its financial statements the identifiable
assets acquired, the liabilities assumed, and any
noncontrolling interest in the acquiree, goodwill
acquired in the business combination or a gain from a
bargain purchase. FAS 141R is effective for which the
acquisition date is on or after the beginning of the first
annual reporting period beginning on or after
December 15, 2008. The Company presently does not
expect the adoption of FAS 141R to have an effect on
its financial statements.

In December 2007, the Financial Accounting
Standards Board issued Statement of Financial
Accounting Standards No. 160 ("FAS 160"),
Noncontrolling Interests in Consolidated Financial
Statements, which establishes accounting and
reporting standards for the noncontrolling interest in a
subsidiary and for the deconsolidation of a subsidiary.
FAS 160 is effective for financial statements issued for
fiscal years beginning on or after December 15, 2008,
and interim periods within those fiscal years. The
Company presently does not expect the adoption of
FAS 160 to have an effect on its financial statements.

Management does not believe that any other recently
issued, but not yet effective accounting
pronouncements, if adopted, would have a material
effect on the accompanying financial statements.






AFH HOLDING III, INC.
(A Development Stage Company)
Notes to Financial Statements
December 31, 2007

Note 3 - Going Concern:

The accompanying financial statements have been
prepared assuming that the Company will continue as
a going concern, which contemplates the
recoverability of assets and the satisfaction of
liabilities in the normal course of business.

The Company has had no revenue and has incurred
accumulated net losses from April 16, 2007
(inception) through the period ended December 31,
2007 of $7,021. In addition, the Company's
development activities since inception have been
financially sustained through equity financing.

The ability of the Company to continue as a going
concern is dependent upon its ability to find a suitable
acquisition/merger candidate, raise additional capital
from the sale of common stock, and receive additional
paid-in capital from its shareholder and, ultimately, the
achievement of significant operating revenues. The
accompanying financial statements do not include any
adjustments that might be required should the
Company be unable to recover the value of its assets
or satisfy its liabilities

Note 4 - Equity Securities:

Holders of shares of common stock shall be entitled to
cast one vote for each common share held at all
stockholder's meetings for all purposes, including the
election of directors. The common stock does not have
cumulative voting rights.

The preferred stock of the Company shall be issued by
the Board of Directors of the Company in one or more
classes or one or more series within any class and such
classes or series shall have such voting powers, full or
limited, or no voting powers, and such designations,
preferences, limitations or restrictions as the Board of
Directors of the Company may determine, from time
to time.

No holder of shares of stock of any class shall be
entitled as a matter of right to subscribe for or
purchase or receive any part of any new or additional
issue of shares of stock of any class, or of securities
convertible into shares of stock of any class, whether
now hereafter authorized or whether issued for money,
for consideration other than money, or by way of
dividend.

Note 5 - Income Taxes:

No current provision or benefit for federal income
taxes has been recorded for the year period from
inception (April 16, 2007), through December 31,
2007 as the Company has no taxable income or loss.

Note 6 - Related Party Transactions:

The Company utilizes the office space and equipment
of its sole stockholder at no cost. Management
estimates such amounts to be immaterial.

Item 8. Changes in and Disagreements with
Accountants on Accounting and Financial
Disclosure.

       None.



AFH HOLDING III, INC.
(A Development Stage Company)
Notes to Financial Statements
December 31, 2007


Item 8A. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures.

The management of the Company, including the
principal executive and financial officer, conducted an
evaluation of the effectiveness of the design and
operation of our disclosure controls and procedures as
defined in Exchange Act Rule 13a-15(e) and 15d-
15(e) as of December 31, 2007. Based on that
evaluation, the principal executive and financial
officer concluded that as of December 31, 2007, our
disclosure controls and procedures were effective to
ensure (i) that information required to be disclosed by
us in the reports we file or submit under the Exchange
Act is recorded, processed, summarized and reported
within the time periods specified in the SEC's rules
and forms and (ii) that information required to be
disclosed in reports that we file or submit under the
Exchange Act is accumulated and communicated to
our management including our chief executive and
financial officer, to allow timely decisions regarding
required disclosure.

This annual report does not include a report of
management's assessment regarding internal control
over financial reporting or an attestation report of the
company's registered public accounting firm due to a
transition period established by rules of the SEC for
newly public companies.

No change in our internal control over financial
reporting (as defined in Rules 13a-15(f) and 15d-15(f)
under the Exchange Act) occurred during the last
fiscal quarter of the year ended December 31, 2007
that has materially affected, or is reasonably likely to
materially affect, the Company's internal control over
financial reporting.

Changes in Internal Controls.

There have been no changes in our internal controls
over financial reporting during the period covered by
this report that has materially affected or is reasonably
likely to materially affect our internal controls. This
annual report does not include a report of
management's assessment regarding internal control
over financial reporting or an attestation report of the
company's registered public accounting firm due to a
transition period established by rules of the SEC for
newly public companies.

Item 8B. Other Information.

       None.


PART III

Item 9. Directors and Executive Officers of the
Company.

(a) Identification of Directors and Executive Officers.
The following table sets forth certain information
regarding the Company's directors and executive
officers for the fiscal year ended December 31, 2007:

Name

Position

Term
Amir F.
Heshmatpour

President,
Secretary and
Director

April 16, 2007
thru Present

       The Company's officers and directors are
elected annually for a one year term or until their
respective successors are duly elected and qualified or
until their earlier resignation or removal.

     	Mr. Heshmatpour's principal business
occupation for the last five years has been as a private
investor.  From 1994 until the end of 2002, he also
served as Chairman and Chief Executive Officer of
Metrophone Telecommunications, Inc.  Mr.
Heshmatpour also serves as President and Secretary of
each of AFH Holding I, Inc., AFH Holding II, Inc.,
AFH Holding III, Inc., AFH Holding IV, Inc., AFH
Holding V, Inc., AFH Holding VII, Inc., AFH
Acquisition III, Inc., AFH Acquisition IV Inc., AFH
Acquisition V Inc., AFH Acquisition VI, Inc., AFH
Acquisition VII, Inc., AFH Acquisition VIII, Inc.,
AFH Acquisition IX, Inc., AFH Acquisition X, Inc.,
AFH Acquisition XI, Inc., and AFH Acquisition XII,
Inc., which positions he was elected to in 2007.  Mr.
Heshmatpour is a director of each of AFH Holding I,
Inc., AFH Holding II, Inc., AFH Holding III, Inc.,
AFH Holding IV, Inc., AFH Holding V, Inc., AFH
Holding VII, Inc., AFH Acquisition III, Inc., AFH
Acquisition IV Inc., AFH Acquisition V Inc., AFH
Acquisition VI, Inc., AFH Acquisition VII, Inc., AFH
Acquisition VIII, Inc., AFH Acquisition IX, Inc., AFH
Acquisition X, Inc., AFH Acquisition XI, Inc., and
AFH Acquisition XII, Inc.

 (b) Significant Employees.

       As of the date hereof, the Company has no
significant employees.

(c) Family Relationships.

       None.

(d) Involvement in Certain Legal Proceedings.

       There have been no events under any
bankruptcy act, no criminal proceedings and no
judgments, injunctions, orders or decrees material to
the evaluation of the ability and integrity of any
director, executive officer, promoter or control person
of Company during the past five years.

Compliance with Section 16(a) of the Exchange
Act

       Section 16(a) of the Exchange Act requires
the Company's directors and officers, and persons who
beneficially own more than 10% of a registered class
of the Company's equity securities, to file reports of
beneficial ownership and changes in beneficial
ownership of the Company's securities with the SEC
on Forms 3, 4 and 5. Officers, directors and greater
than 10% stockholders are required by SEC regulation
to furnish the Company with copies of all
Section 16(a) forms they file.

       Based solely on the Company's review of the
copies of the forms received by it during the period
since inception, April 16, 2007, through December 31,
2007 and written representations that no other reports
were required, the Company believes that the no
persons who, at any time during such period, was a
director, officer or beneficial owner of more than 10%
of Common Stock failed to comply with all
Section 16(a) filing requirements during such fiscal
year.

Code of Ethics

       We have not adopted a Code of Business
Conduct and Ethics that applies to our principal
executive officer, principal financial officer, principal
accounting officer or controller, or persons performing
similar functions because there is only one person
involved in the management of the Company and he
devotes only a limited amount of time to our business.




Nominating Committee

	We have not adopted any procedures by
which security holders may recommend nominees to
our Board of Directors.

Audit Committee

	The Board of Directors acts as the audit
committee. The Company does not have a qualified
financial expert at this time because it has not been
able to hire a qualified candidate. Further, the
Company believes that it has inadequate financial
resources at this time to hire such an expert. The
Company intends to continue to search for a qualified
individual for hire.

Item 10. Executive Compensation.

       The following table sets forth the cash
compensation paid by the Company to its President
(the sole executive officer of the Company) for
services rendered during the period since inception,
April 16, 2007, through December 31, 2007.

Name and Position

Year

Total
Compensation
Amir F. Heshmatpour, President,
Secretary and Director

2007

None

Director Compensation

	We do not currently pay any cash fees to our
sole director, nor do we pay his expenses in attending
board meetings.

Employment Agreements

       The Company is not a party to any
employment agreements.

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

       The following tables set forth certain
information as of March 27, 2008, regarding (i) each
person known by the Company to be the beneficial
owner of more than 5% of the outstanding shares of
Common Stock, (ii) each director, nominee and
executive officer of the Company and (iii) all officers
and directors as a group.

Name and Address of Beneficial Owner, Amount
and Nature of Beneficial Owner(1), Percent of Class
AFH Holding and Advisory, LLC(2)
9595 Wilshire Boulevard, Suite 900

Beverly Hills, California 90212
, 5,000,000, 100%
Amir F.
Heshmatpour(3)

9595 Wilshire Boulevard, Suite
900
Beverly Hills, California 90212
, 5,000,000(4), 100%
All Officers, Directors and persons owning more than
5% as a Group, 5,000,000, 100%



(1)
Under Rule 13d-3, a beneficial owner
of a security includes any person who,
directly or indirectly, through any
contract, arrangement, understanding,
relationship, or otherwise has or
shares: (i) voting power, which
includes the power to vote, or to direct
the voting of shares; and (ii)
investment power, which includes the
power to dispose or direct the
disposition of shares.  Certain shares
may be deemed to be beneficially
owned by more than one person (if, for
example, persons share the power to
vote or the power to dispose of the
shares).  In addition, shares are
deemed to be beneficially owned by a
person if the person has the right to
acquire the shares (for example, upon
exercise of an option) within 60 days
of the date as of which the information
is provided.  In computing the
percentage ownership of any person,
the amount of shares outstanding is
deemed to include the amount of
shares beneficially owned by such
person (and only such person) by
reason of these acquisition rights.  As a
result, the percentage of outstanding
shares of any person as shown in this
table does not necessarily reflect the
person's actual ownership or voting
power with respect to the number of
shares of common stock actually
outstanding.


(2)
Mr. Heshmatpour, the Managing
Member of AFH Advisory, has
investment and voting control over the
shares owned by AFH Advisory, and
therefore may be deemed to be a
beneficial owner thereof.


(3)
Mr. Heshmatpour is the Company's
President, Secretary and sole director.


(4)
Represents shares of the Company's
common stock owned by AFH
Advisory.  As Managing Member of
AFH Advisory, Mr. Heshmatpour may
be deemed the beneficial owner of
these shares of the Company's
common stock.

Item 12. Certain Relationships and Related
Transactions.

The Company utilizes the office space and equipment
of its sole officer and director at no cost. Management
estimates such costs to be immaterial.

Except as otherwise indicated herein, there have been
no related party transactions, or any other transactions
or relationships required to be disclosed pursuant to
Item 404 of Regulation S-B.

Item 13. Exhibits.

Index to Exhibits

Exhibit

Description



*3.1

Certificate of Incorporation, as filed with the
Delaware Secretary of State on April 16,
2007.



*3.2

By-laws.

31.1

Certification of the Company's Principal
Executive Officer and Principal Financial
Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002, with respect to
the registrant's Annual Report on Form 10-
KSB for the year ended December 31, 2007.



32.1

Certification of the Company's Principal
Executive Officer and Principal Financial
Officer pursuant to 18 U.S.C. Section 1350,
as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.

32.1

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

*
Filed as an exhibit to the Company's
Registration Statement on Form 10-SB, as
filed with the Securities and Exchange
Commission on October 5, 2007, and
incorporated herein by this reference.

Item 14. Principal Accountant Fees and Services

Rotenberg & Associates is the Company's
independent registered public accounting firm.

Audit Fees

	During the period since inception, April 16,
2007, through December 31, 2007, the aggregate fees
billed to the Company by its independent auditors
were $3,271 for the annual audit of financial
statements and review of the financial statements
included in the Company's Quarterly Reports on Form
10-QSB.

Tax Fees

       There were no fees billed by Rotenberg for
professional services for tax compliance, tax advice,
and tax planning for the fiscal year ended December
31, 2007 and for the period from April 16, 2007
(Inception) to December 31, 2007.

Audit Committee's Pre-Approval Process

	The Board of Directors acts as the audit
committee of the Company, and accordingly, all
services are approved by the sole member of the Board
of Directors.

SIGNATURES

       In accordance with Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has
caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.





AFH HOLDING III, INC.






Dated: March 27, 2008
By:
/s/ Amir F.
Heshmatpour


Name: Amir F.
Heshmatpour

Title: President,
Secretary and sole
Director







Exhibit 31.1

Certification of Principal Executive Officer and
Principal Financial Officer
Pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002
and Securities and Exchange Commission Release
34-46427

I, Amir F. Heshmatpour, certify that:

1. I have reviewed this annual report on Form 10-KSB
of AFH Holding III, Inc.;

 	2.	Based on my knowledge, this report
does not contain any untrue statement of a material
fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances
under which such statements were made, not
misleading with respect to the period covered by this
report;

 	3.	Based on my knowledge, the
financial statements, and other financial information
included in this report, fairly present in all material
respects the financial condition, results of operations
and cash flows of the small business issuer as of, and
for, the periods presented in this report;

 	4.	The small business issuer's other
certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-
15(e) and 15d-15(e)) and internal control over
financial reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the small business issuer
and have:

 	 	A.	Designed such disclosure
controls and procedures, or caused such disclosure
controls and procedures to be designed under our
supervision, to ensure that material information
relating to the small business issuer, including its
consolidated subsidiaries, is made known to us by
others within those entities, particularly during the
period in which this report is being prepared;

 	 	B.	Designed such internal
controls over financial reporting, or caused such
internal control over financial reporting to be designed
under our supervision, to provide reasonable assurance
regarding the reliability of financial reporting and the
preparation of financial statements for external
purposes in accordance with generally accepted
accounting principles;

 	 	C.	Evaluated the effectiveness
of the small business issuer's disclosure controls and
procedures and presented in this report our
conclusions about the effectiveness of the disclosure
controls and procedures, as of the end of the period
covered by this report based on such evaluation; and

 	 	D.	Disclosed in this report any
change in the small business issuer's internal controls
over financial reporting that occurred during the small
business issuer's most. recent fiscal quarter (the small
business issuer's fourth fiscal quarter in the case of an
annual report) that has materially affected or is
reasonably likely to materially affect, the small
business issuer's internal control over financial
reporting; and

 	5.	I have disclosed, based on my most
recent evaluation of internal control over financial
reporting, to the small business issuer's auditors and
the small business issuer's board of directors:

 	 	A.	All significant deficiencies
and material weaknesses in the design or operation of
internal control over financial reporting which are
reasonably likely to adversely affect the small business
issuer's ability to record, process, summarize and
report financial information; and

        	 	B.	Any fraud,
whether or not material, that involves management or
other employees who have a significant role in the
small business issuer's internal control over financial
reporting.

Date: March 27,2008


/s/ Amir F.
Heshmatpour




Amir F. Heshmatpour



Principal Executive
Officer and Principal
Financial Officer



















































Exhibit 32.1

Certification of Principal Executive Officer and
Principal Financial Officer
Pursuant to 18 U.S.C. Section 1350
As Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002

	In connection with the Annual Report of
AFH Holding III, Inc. (the "Company") on Form 10-
KSB for the fiscal year ended December 31, 2007 as
filed with the Securities and Exchange Commission on
the date hereof (the "Report"), I, Amir F.
Heshmatpour, certify, pursuant to 18 U.S.C. ss. 1350,
as adopted pursuant to ss. 906 of the Sarbanes-Oxley
Act of 2002, that to my knowledge:

(1) The Report fully complies with the requirements of
section 13(a) or 15(d) of the Securities Exchange Act
of 1934; and

(2) The information contained in the Report fairly
presents, in all material respects, the financial
condition and results of operations of the Company.








/s/ Amir F.
Heshmatpour




Amir F. Heshmatpour



Principal Executive
Officer
Principal Financial
Officer
March 27, 2008
























32.2

CERTIFICATION FURNISHED
PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO SECTION 906
OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report on Form 10-K
for the period ended December 31, 2007 (the
"Report") filed by AFH Holding III, Inc. (the
"Company") with the Securities and Exchange
Commission, I, Amir F. Heshmatpour, Chief Financial
Officer of the Company, certify, pursuant to 18 U.S.C.
ss. 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that:
The Report fully complies with the requirements of
Section 13(a) or 15(d) of the Securities Exchange Act
of 1934; and
The information contained in the Report fairly
presents, in all material respects, the financial
condition and results of operations of the Company.
Date: March 27, 2008


/s/ Amir F.
Heshmatpour
Amir F. Heshmatpour
Chief Financial
Officer
A signed original of this written statement required by
Section 906 has been provided to AFH Holding III,
Inc. and will be retained by AFH Holding III, Inc. and
furnished to the Securities and Exchange Commission
or its staff upon request.
























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