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UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 10-KSB

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

For the fiscal year ended March 31, 2008

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

For the transition period from _________________ to
_________________

Commission file number: 333-145195

ORCA INTERNATIONAL LANGUAGE SCHOOLS
INC.(Name of small business issuer in its charter)

|British Columbia                                                     | N/A                                 
|-------------------------------------------------------------------- | ------------------------------------
|(State or other jurisdiction of incorporation or
      organization) | (I.R.S. Employer Identification No.)

1685 - 58A Street, Delta BC Canada V4L
1X5(Address of principal executive offices)

|Issuers telephone number: | 604-817-0534
|-------------------------- | ------------

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

|None                | N/A                                      
|------------------- | -----------------------------------------
|Title of each class | Name of each exchange on which registered

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

Common Stock without par value(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) 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 [   ]

Check if there is no disclosure of delinquent filers in response
to Item 405 of Regulation S-B contained in this form, and no disclosure will
be contained, to the best of 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. Yes [X]   No [ 
 ]

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ii

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

State issuers revenues for its most recent fiscal year:
$Nil

State the aggregate market value of the voting and non-voting
common equity held by non-affiliates computed by reference to the price of
our common stock at $0.10 per share.

735,000 common shares @ $0.101=
$73,500.1 Closing Price paid by purchasers on

(ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE
YEARS)

Check whether the issuer has filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the Exchange Act after
the distribution of securities under a plan confirmed by a court.Yes
[   ]   No [   ]

(APPLICABLE ONLY TO CORPORATE REGISTRANTS)

State the number of shares outstanding of each of the issuers
classes of common equity, as of the latest practicable date. 5,071,210
common shares as of July 8, 2008

DOCUMENTS INCORPORATED BY REFERENCE

If the following documents are incorporated by reference,
briefly describe them and identify the part of the Form 10-KSB (e.g., Part
I, Part II, etc.) into which the document is incorporated: (1) any annual report
to security holders; (2) any proxy or information statement; and (3) any
prospectus filed pursuant to Rule 424(b) or (c) of the Securities Act of
1933 (Securities Act). The listed documents should be clearly described
for identification purposes (e.g., annual report to security holders for fiscal
year ended December 24, 1990).

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

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iii

TABLE OF CONTENTS

|PART I                                                                                              | 1 
|--------------------------------------------------------------------------------------------------- | --
|ITEM 1: DESCRIPTION OF BUSINESS                                                                     | 1 
|Corporate History                                                                                   | 1 
|Current Business                                                                                    | 1 
|Reports to Security
      Holders                                                                   | 1 
|ITEM 2: DESCRIPTION OF PROPERTY                                                                     | 1 
|Executive Offices                                                                                   | 1 
|ITEM 3: LEGAL PROCEEDINGS                                                                           | 2 
|ITEM 4: SUBMISSION OF
      MATTERS TO A VOTE OF SECURITY HOLDERS                                   | 2 
|PART II                                                                                             | 2 
|ITEM 5: MARKET FOR COMMON
      EQUITY AND RELATED STOCKHOLDER MATTERS                              | 2 
|Market Information                                                                                  | 2 
|Holders                                                                                             | 2 
|Dividends                                                                                           | 2 
|ITEM 6: MANAGEMENTS
      DISCUSSION AND ANALYSIS OR PLAN OF OPERATION                             | 2 
|Forward Looking Statements                                                                          | 2 
|Plan of Operation                                                                                   | 3 
|Results of Operations                                                                               | 4 
|Future Operations                                                                                   | 5 
|Purchase of Significant Equipment                                                                   | 5 
|Employees                                                                                           | 5 
|Off-Balance Sheet Arrangements                                                                      | 6 
|Application of Critical
      Accounting Policies and Estimates                                     | 6 
|Going Concern                                                                                       | 8 
|RISK FACTORS                                                                                        | 8 
|Risks Associated with Our Company                                                                   | 8 
|Risks Associated with
      Our Common Stock                                                        | 10
|ITEM 7: FINANCIAL STATEMENTS                                                                        | 11
|ITEM 8. CHANGES IN AND
      DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE. | 14
|Item 8A. Controls and Procedures.                                                                   | 14
|Item 8B. Other
      Information.                                                                   | 14
|PART III                                                                                            | 15
|ITEM 9: DIRECTORS,
      EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS                          | 15
|Directors and Executive Officers,
      Promoters and Control Persons                               | 15
|Significant Employees                                                                               | 16
|Family Relationships                                                                                | 16
|Involvement in Certain
      Legal Proceedings                                                      | 16
|Compliance with Section 16(a) of the
      Securities Exchange Act of 1934                          | 17
|Code of Ethics                                                                                      | 17

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iv

|Committees
      of the Board of Directors                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 17
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --
|ITEM
      10. EXECUTIVE COMPENSATION.                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 18
|Outstanding
      Equity Awards at Fiscal Year-End                                                                                                                                                                                                                                                                                                                                                                                                                                                              | 18
|Compensation
      of Directors                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 18
|Employment
      Agreements with our Named Executive Officers                                                                                                                                                                                                                                                                                                                                                                                                                                                   | 19
|Pension,
      Retirement or Similar Benefit Plans                                                                                                                                                                                                                                                                                                                                                                                                                                                              | 19
|ITEM
      11: SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
      RELATED STOCKHOLDER MATTERS                                                                                                                                                                                                                                                                                                                                                                                             | 19
|Securities
      Authorized for Issuance under Equity Compensation Plans                                                                                                                                                                                                                                                                                                                                                                                                                                        | 19
|Security
      ownership of certain beneficial owners.                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 19
|On
      July 2, 2008, Messrs. Wooldridge, Han and Clark and Ms. MacDonald entered
      into an agreement with SGB C&C Investment Ltd. to sell to SGB C&C
      Investment an aggregate of 2,635,000 shares of common stock. The purchase
      and sale of these shares of common stock is scheduled to complete on July
      24, 2008 and at that time, SGB C&C Investment Ltd. will own 51.96% of
      our issued and outstanding shares of common stock and have effective
      control of our company. | 20
|ITEM
      12: CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
      INDEPENDENCE                                                                                                                                                                                                                                                                                                                                                                                                                  | 20
|Transactions
      with Related Persons                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 20
|Director
      Independence                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | 20
|ITEM
      13: EXHIBITS AND REPORTS                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | 20
|ITEM
      14: PRINCIPAL ACCOUNTANT FEES AND SERVICES                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 22
|SIGNATURES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 23

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PART I

ITEM 1: DESCRIPTION OF BUSINESS

Corporate History

We were incorporated in the province of British Columbia,
Canada under the name Slocan Valley Minerals Ltd. on November 6, 1997 with an
authorized share capital of 10,000,000 common shares without par value.
Following our incorporation we were not actively engaged in any business
activities. On June 1, 2004 we increased our authorized share capital from
10,000,000 common shares without par value to an unlimited number of common
shares without par value. On June 11, 2004 we changed our name to Orca
International Language Schools Inc. by filing a Certificate of Name Change with
Ministry of Finance Corporate and Personal Property Registries.

Current Business

Our goal has been to provide management services to schools in
the international education industry based on the principles of: improving their
administrative, operational, marketing, sales and human resources functions;
building links with other schools worldwide to foster student exchange; and
repositioning the schools to concentrate their curriculum on preparing students
for one of the three major English proficiency tests. We have been searching for
a school as the initial client but we have not been successful in finding any
such school. Since we have incurred losses totaling $157,118 since November 6,
1997 and have cash in the amount of $3,592 as at March 31, 2008, our board of
directors has decided to explore the possibility of adopting a different
business plan to protect our shareholders value.

Reports to Security Holders

We are not required to deliver an annual report to our
stockholders but will voluntarily send an annual report, together with our
annual audited financial statements. Any Securities and Exchange Commission
filings that we do file will be available to the public over the internet at the
SEC's website at http://www.sec.gov.

The public may read and copy any materials filed by us with the
SEC at the SEC's Public Reference Room at 100 F Street, NE, Washington DC 20549.
The public may obtain information on the operation of the Public Reference Room
by calling the SEC at 1-800-SEC-0330. We are an electronic filer. The SEC
maintains an internet site that contains reports, proxy and information
statements, and other information regarding issuers that file electronically
with the SEC. The internet address of the site is http://www.sec.gov.

ITEM 2: DESCRIPTION OF PROPERTY

Executive Offices

Our principal executive office is located at 1685 58A Street,
Delta, British Columbia, Canada V4L 1X5. Our telephone number is (604) 817-0534.
Our President, Stuart Wooldridge, has donated the use of our office facility at
a rate of CDN$250 per month to our company. We believe our current premises are
adequate for our current operations and we do not anticipate that we will
require any additional premises in the foreseeable future. When and if we
require additional space, we intend to move at that time

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ITEM 3: LEGAL PROCEEDINGS

We know of no material, existing 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 shareholder,
is an adverse party or has a material interest adverse to our interest.

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

None.

PART II

ITEM 5: MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS

Market Information

Our common stock is not now, nor has ever been, traded on any
market or securities exchange, and we have not applied for listing or quotation
on any public market. There is currently no public trading market for our common
stock. We do not have any common stock subject to outstanding options or
warrants.

As of the date of this annual report, our companys issued and
outstanding shares were 5,071,210.

We engaged a market maker to file a Form 15c-211 to qualify our
shares for quotation on the Financial Industry Regulatory Authoritys
Over-the-Counter Bulletin Board. On May 6, 2008, our common stock became
eligible for quotation on the Over-the-Counter Bulletin Board under the symbol
OALSF. However, there is no assurance that a public market will materialize
for our common stock.

Holders

As of July 8, 2008 there are 27 registered holders of record of
our common stock.

Our transfer agent is Pacific Stock Transfer Company, 500 E.
Warm Springs Road, Suite 240, Las Vegas NV 89119, Phone: (702) 361-3033, Fax:
(702) 433-1979

Dividends

We have not declared any dividends on our common stock since
the inception of our company. There is no restriction in our articles of
incorporation and bylaws that will limit our ability to pay dividends on our
common stock. However, we do not anticipate declaring and paying dividends to
our shareholders in the near future.

ITEM 6: MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN OF
OPERATION

Forward Looking Statements.

This annual report contains forward-looking statements which
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, intends 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 on page 8, that may cause our or our industrys

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- 3 

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.

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. 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.

Plan of Operation

The following discussion should be read in conjunction with our
audited financial statements and the related notes that appear elsewhere in this
registration statement and prospectus. The following discussion contains
forward-looking statements that reflect our plans, estimates and beliefs. Our
actual results could differ materially from those discussed in the forward
looking statements. Factors that could cause or contribute to such differences
include those discussed below and elsewhere in this registration statement and
prospectus, particularly in the section entitled Risk Factors beginning on
page 8.

Our audited financial statements are stated in United States
dollars and are prepared in accordance with United States generally accepted
accounting principles.

Our goal has been to provide management services to schools in
the international education industry (hereafter clients or schools) based on
the principles of: improving their administrative, operational, marketing, sales
and human resources functions; building links with other schools worldwide to
foster student exchange; and repositioning the schools to concentrate their
curriculum on preparing students for one of the three major English proficiency
tests.

We have been searching for a school as the initial client but
we have not been successful in finding any such school. Since we have incurred
losses totaling $157,118 since November 6, 1997 and have cash in the amount of
$3,592 as at March 31, 2008, our board of directors has decided to explore the
possibility of adopting a different business plan to protect our shareholders
value.

Estimated Expenses for the Next 12 Month Period

We estimate our general administrative expenses and working
capital requirements for the next 12-month period to be as follows:

Automobile
    
    6,000Office Expenses
    
    6,000Telephone and Communications
    
    2,000Travel
    
    10,000Accounting
    
    20,000Legal
    
    20,000Total
    
    64,000


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- 4 

Results of Operations

Becoming and Operating as a Public Company

We filed a registration statement on August 7, 2007. This
registration statement was our first step toward becoming a public company. The
registration statement became effective on September 13, 2007 and we are now
subject to the reporting requirements of Section 15(d) of the Exchange Act, and
will be required to file disclosure documents with the Securities and Exchange
Commission. We expect to incur on-going legal expenses to comply with our
reporting responsibilities as a public company under the Exchange Act, as
amended. We estimate our legal, audit and accounting expenses for the next
12-month period to be approximately $40,000.

Cash Requirements

For the next 12 months we plan to explore opportunities to
adopt a business plan other than the current business of providing management
services to schools in the international education industry. These endeavors
will cost approximately $24,000. As of March 31, 2008 we had a working capital
deficit of $55,532. We have no income from operations. We will require
additional funds to implement our plans. So far, some of our directors and
officers have been loaning our company money to meet our cash requirements. We
may also consider raising funds through equity financing, debt financing, or
other sources, which may result in the dilution in the equity ownership of our
shares. We will also require additional financing to sustain our business
operations if we are not successful in earning revenues. We currently do not
have any arrangements for further financing and we may not be able to obtain
financing when required. Our future is dependent upon our ability to obtain
financing.

As at March 31, 2008 we had $59,981 in current liabilities. Our
financial statements report a net loss of $157,118 for the period from November
6, 1997 (date of inception) to March 31, 2008. Our net loss is primarily due to
accounting, legal, travel expenses and management fees.

We have suffered recurring losses from operations. The
continuation of our business is dependent upon obtaining further financing, the
capturing of schools as clients, commencing our business and achieving a
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
shareholders. Obtaining commercial loans, assuming those loans would be
available, will increase our liabilities and future cash commitments.

Liquidity and Capital Resources

|Working Capital           |                |                   |                      
|------------------------- | -------------- | ----------------- | ---------------------
|                          | As at          | As at             | Percentage           
|                          | March 31, 2008 | December 31, 2007 | Increase / (Decrease)
|Current Assets            | $4,449         | $ 4,697           | (5.28%)              
|Current Liabilities       | $59,981        | $
      51,103    | 17.37%               
|Working Capital (Deficit) | $ (55,532)     | $ (46,406)        | 19.67%               

We will require additional financing in order to enable us to
proceed with our plan of operations, as discussed above, including approximately
$64,000 over the next 12 months to pay for our ongoing general and
administrative expenses. These expenses include legal, accounting and other
professional fees associated with our being a reporting company under the
Exchange Act. These cash requirements are in excess of our current cash and
working capital resources. Accordingly, we will require additional financing in
order to continue operations and to repay our liabilities. There is no assurance
that any party

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- 5 

will advance additional funds to us in order to enable us to
sustain our plan of operations or to repay our liabilities.

We anticipate our operating expenses will increase as we
undertake our plan of operations. The increase will be attributable to the
retention of consultant experts, traveling expenses, and development expenses as
we explore opportunities to adopt a business plan other than the current
business of providing management services to schools in the international
education industry. We anticipate our ongoing operating expenses will also
increase as a result of our ongoing reporting requirements under the Exchange
Act.

Future Operations

Presently, our revenues are not sufficient to meet operating
and capital expenses and we have incurred operating losses since inception,
which are likely to continue for the foreseeable future. We anticipate that we
will have negative cash flows during the year ended March 31, 2008. We
anticipate the need to raise additional capital to fund operations over the next
12 months. We intend to raise the capital required to satisfy our needs
primarily through the sale of our equity securities or debt. We will attempt to
minimize costs until more cash is available through financing or operating
activities.

Due to the uncertainty of our ability to meet our current
operating and capital expenses, in their report dated June 10, 2008 on the
annual financial statements for the year ended March 31, 2008, filed in this
annual report, our independent registered public accounting firm included an
explanatory paragraph regarding concerns about our ability to continue as a
going concern in their audit report.

There is substantial doubt about our ability to continue as a
going concern as the continuation of our business is dependent upon obtaining
further financing and achieving a 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 shareholders.
Obtaining commercial loans, assuming those loans would be available, will
increase our liabilities and future cash commitments.

There are no assurances that we will be able to obtain further
funds required for our continued operations. We plan to pursue various financing
alternatives to meet our immediate and long-term financial requirements. There
can be no assurance 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 be forced to scale down or perhaps even cease the operation of our
business.

Purchase of Significant Equipment

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

Employees

Currently our only employee is Stuart Wooldridge our President,
Secretary and Director. At present we do not anticipate hiring employees in the
near future. However, we will hire independent contractors.

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- 6 

Off-Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have
or are reasonably likely to have a current or future effect on our financial
condition, changes in financial condition, revenues or expenses, results of
operations, liquidity, capital expenditures or capital resources that is
material to stockholders.

Application of Critical Accounting Policies and Estimates

The preparation of financial statements in accordance with U.S.
generally accepted accounting principles requires us to make estimates and
assumptions that affect the reported amounts of assets and liabilities at the
date of the financial statements and the reported amounts of net revenue and
expenses in the reporting period. We regularly evaluate our estimates and
assumptions related to useful life and recoverability of long-lived assets,
donated expenses, and deferred income tax valuation allowances. We base our
estimates and assumptions on current facts, historical experience and various
other factors that we believe to be reasonable under the circumstances, the
results of which form the basis for making judgments about the carrying values
of assets and liabilities and the accrual of costs and expenses that are not
readily apparent from other sources. The actual results experienced by us may
differ materially and adversely from our estimates. To the extent there are
material differences between our estimates and the actual results, our future
results of operations will be affected.

We believe the following critical accounting policies require
us to make significant judgments and estimates in the preparation of our
financial statements:

Long-Lived Assets

In accordance with SFAS No. 144, Accounting for the
Impairment or Disposal of Long-Lived Assets, we test long-lived assets or
asset groups for recoverability when events or changes in circumstances indicate
that their carrying amount may not be recoverable. Circumstances which could
trigger a review include, but are not limited to: significant decreases in the
market price of the asset; significant adverse changes in the business climate
or legal factors; accumulation of costs significantly in excess of the amount
originally expected for the acquisition or construction of the asset; current
period cash flow or operating losses combined with a history of losses or a
forecast of continuing losses associated with the use of the asset; and current
expectation that the asset will more likely than not be sold or disposed
significantly before the end of its estimated useful life.

Recoverability is assessed based on the carrying amount of the
asset and its fair value which is generally determined based on the sum of the
undiscounted cash flows expected to result from the use and the eventual
disposal of the asset, as well as specific appraisal in certain instances. An
impairment loss is recognized when the carrying amount is not recoverable and
exceeds fair value.

Recent Accounting Pronouncements

In March 2008, the Financial Accounting Standards Board
(FASB) issued SFAS No. 161, Disclosures about Derivative Instruments and
Hedging Activities  an amendment to FASB Statement No. 133. SFAS No. 161
is intended to improve financial standards for derivative instruments and
hedging activities by requiring enhanced disclosures to enable investors to
better understand their effects on an entity's financial position, financial
performance, and cash flows. Entities are required to provide enhanced
disclosures about: (a) how and why an entity uses derivative instruments; (b)
how derivative instruments and related hedged items are accounted for under
Statement 133 and its related interpretations; and (c) how derivative
instruments and related hedged items affect an entitys financial position,
financial performance, and cash flows. It is effective for financial statements
issued for fiscal years beginning after

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- 7 

November 15, 2008, with early adoption encouraged. The Company
is currently evaluating the impact of SFAS No. 161 on its financial statements,
and the adoption of this statement is not expected to have a material effect on
the Companys financial statements.

In December 2007, the FASB issued SFAS No. 141R, Business
Combinations. This statement replaces SFAS 141 and defines the acquirer in
a business combination as the entity that obtains control of one or more
businesses in a business combination and establishes the acquisition date as the
date that the acquirer achieves control. SFAS 141R requires an acquirer to
recognize the assets acquired, the liabilities assumed, and any non-controlling
interest in the acquiree at the acquisition date, measured at their fair values
as of that date. SFAS 141R also requires the acquirer to recognize contingent
consideration at the acquisition date, measured at its fair value at that date.
This statement is effective for fiscal years, and interim periods within those
fiscal years, beginning on or after December 15, 2008. Earlier adoption is
prohibited. The adoption of this statement is not expected to have a material
effect on the Company's financial statements.

In December 2007, the FASB issued SFAS No. 160,
Noncontrolling Interests in Financial Statements Liabilities an Amendment
of ARB No. 51. This statement amends ARB 51 to establish accounting and
reporting standards for the Noncontrolling interest in a subsidiary and for the
deconsolidation of a subsidiary. This statement is effective for fiscal years,
and interim periods within those fiscal years, beginning on or after December
15, 2008. Earlier adoption is prohibited. The adoption of this statement is not
expected to have a material effect on the Company's financial statements.

In February 2007, the Financial Accounting Standards Board
(FASB) issued SFAS No. 159, The Fair Value Option for Financial Assets and
Financial Liabilities  Including an Amendment of FASB Statement No. 115.
This statement permits entities to choose to measure many financial instruments
and certain other items at fair value. Most of the provisions of SFAS No. 159
apply only to entities that elect the fair value option. However, the amendment
to SFAS No. 115 Accounting for Certain Investments in Debt and Equity
Securities applies to all entities with available-for-sale and trading
securities. SFAS No. 159 is effective as of the beginning of an entitys first
fiscal year that begins after November 15, 2007. Early adoption is permitted as
of the beginning of a fiscal year that begins on or before November 15, 2007,
provided the entity also elects to apply the provision of SFAS No. 157, Fair
Value Measurements.The adoption of this statement is not expected to have
a material effect on our financial statements.

In September 2006, the FASB issued SFAS No. 157, Fair Value
Measurements. The objective of SFAS No. 157 is to increase consistency and
comparability in fair value measurements and to expand disclosures about fair
value measurements. SFAS No. 157 defines fair value, establishes a framework for
measuring fair value in generally accepted accounting principles, and expands
disclosures about fair value measurements. SFAS No. 157 applies under other
accounting pronouncements that require or permit fair value measurements and
does not require any new fair value measurements. The provisions of SFAS No. 157
are effective for fair value measurements made in fiscal years beginning after
November 15, 2007. The adoption of this statement is not expected to have a
material effect on our future reported financial position or results of
operations.

In June 2006, the Financial Accounting Standards Board (FASB)
issued FASB Interpretation No. 48, Accounting for Uncertainty in Income
Taxes, an interpretation of FASB Statements No. 109. FIN 48 clarifies the
accounting for uncertainty in income taxes by prescribing a two-step method of
first evaluating whether a tax position has met a more likely than not
recognition threshold and second, measuring that tax position to determine the
amount of benefit to be recognized in the financial statements. FIN 48 provides
guidance on the presentation of such positions within a classified statement of
financial position as well as on de-recognition, interest and penalties,
accounting in interim periods,

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- 8 

disclosure, and transition. FIN 48 is effective for fiscal
years beginning after December 15, 2006. The adoption of this statement did not
have a material effect on our reported financial position or results of
operations.

Going Concern

Our financial statements have been prepared on a going concern
basis, which implies we will continue to realize our assets and discharge our
liabilities in the normal course of business. We have not generated revenues
since inception and have never paid any dividends and are unlikely to pay
dividends or generate earnings in the immediate or foreseeable future. The
continuation of our company as a going concern is dependent upon the continued
financial support from our shareholders, the ability of our company to obtain
necessary equity financing to continue operations, and the attainment of
profitable operations. As at March 31, 2008, we had a working capital deficit of
$55,532 and accumulated deficit of $157,118 since inception. These factors raise
substantial doubt regarding our ability to continue as a going concern. These
financial statements do not include any adjustments to the recoverability and
classification of recorded asset amounts and classification of liabilities that
might be necessary should we be unable to continue as a going concern.

RISK FACTORS

An investment in our common stock involves a number of very
significant risks. You should carefully consider the following risks and
uncertainties in addition to other information in this quarterly report in
evaluating our company and its business before purchasing shares of our
companys common stock. Our business, operating results and financial condition
could be seriously harmed due to any of the following risks. You could lose all
or part of your investment due to any of these risks.

Risks Associated with Our Company

We have a limited operating history and if we are not
successful in operating our business, then investors may lose all of their
investment in our company.

We have a limited operating history. Our business is subject to
the risks and expenses encountered by start up companies, such as uncertainties
regarding our level of future revenues and our inability to budget expenses and
manage growth accordingly and our inability to access sources of financing when
required and at rates favorable to us. Our limited operating history and the
highly competitive nature of the business in which we plan to operate will make
it difficult or impossible to predict future results of our operations. If we
are not successful in operating our business, then investors may lose all of
their investment in our company.

We have a history of losses and have a deficit, which raises
substantial doubt about our ability to continue as a going concern.

We have not generated any revenues since our date of inception
and we will continue to incur operating expenses without revenues until we
acquire school(s) as clients, commence our business and finally, achieve a
profitable level of operations. Our net loss since inception to March 31, 2008
was $157,118. We had cash in the amount of $3,592 as of March 31, 2008. We
currently do not have any operations and we have no income. We estimate our
average monthly operating expenses to be approximately $5,000 each month. We
cannot provide assurances that we will be able to successfully 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 audited financial statements, dated June

---

- 9 

10, 2008. If we are unable to continue as a going concern,
investors will likely lose all of their investments in our company.

Our future is dependent upon our ability to obtain financing
and if we do not obtain such financing, we may have to cease our exploration
activities and investors could lose their entire investment.

There is no assurance that we will operate profitably or will
generate positive cash flow in the future. We will require additional financing
in order to proceed beyond the first few months of our plan of operations. We
will require additional financing to sustain our business operations if we are
not successful in earning revenues. We currently do not have any arrangements
for further financing and we may not be able to obtain financing when required.
Our future is dependent upon our ability to obtain financing. If we do not
obtain such financing, our business could fail and investors could lose their
entire investment.

Because we may never earn revenues from our operations, our
business may fail.

We anticipate that we will incur increased operating expenses
without realizing any revenues. We therefore expect to incur significant losses
into the foreseeable future. We recognize that if we are unable to generate
significant revenues from our business, we will not be able to earn profits or
continue operations. There is no history upon which to base any assumption as to
the likelihood that we will prove successful, and we can provide no assurance
that we will generate any revenues or ever achieve profitability. If we are
unsuccessful in addressing these risks, our business will fail and investors may
lose all of their investment in our company.

Because our directors, executive officers, and principal
shareholders control a large percentage of our common stock, such insiders have
the ability to influence matters affecting our shareholders.

Our directors and executive officers, in the aggregate,
beneficially own 85.51% of the issued and outstanding shares of our common
stock. As a result, they have the ability to influence matters affecting our
shareholders, including the election of our directors, the acquisition or
disposition of our assets, and the future issuance of our shares. Because our
directors, executive officers and principal shareholders control such shares,
investors may find it difficult to replace our management if they disagree with
the way our business is being operated. Because the influence 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.

Our directors and executive officers are engaged in other
business activities and accordingly may not devote sufficient time to our
business affairs, which may affect our ability to conduct operations and
generate revenues.

Our directors and executive officers are involved in other
business activities. Stuart Wooldridge, our President, Secretary and Director
spends approximately 20 hours, or 50%, of his business time on the management of
our company and each of our other directors, Paul Clark, Qiang Benjamin Han and
Sherri Macdonald, spend approximately four hours, or 10%, of their business time
on the management of our company. As a result of their other business endeavors,
they may not be able to devote sufficient time to our business affairs, which
may negatively affect our ability to conduct our ongoing operations and our
ability to generate revenues. In addition, the management of our company may be
periodically interrupted or delayed as a result of their other business
interests.

---

- 10 

All of our assets and all of our directors and executive
officers are outside the United States, with the result that it may be difficult
for investors to enforce within the United States any judgments obtained against
us or any of our directors or officers.

All of our assets are located outside the United States and we
do not currently maintain a permanent place of business within the United
States. In addition, all of our directors and executive officers are nationals
and/or residents of countries other than the United States, 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 us or our officers or directors,
including judgments predicated upon the civil liability provisions of the
securities laws of the United States or any state thereof. Consequently, you may
be effectively prevented from pursuing remedies under U.S. federal securities
laws against them.

Risks Associated with Our Common Stock

There is no active trading market for our common stock and
if a market for our common stock does not develop, our investors will be unable
to sell their shares.

There is currently no active trading market for our common
stock and such a market may not develop or be sustained. We engaged a market
maker to file a Form 15c-211 to qualify our shares for quotation on the
Financial Industry Regulatory Authoritys Over-the-Counter Bulletin Board. On
May 6, 2008, our common stock became eligible for quotation on the
Over-the-Counter Bulletin Board under the symbol OALSF. Further, the
Over-the-Counter Bulletin Board is not a listing service or exchange, but is
instead a dealer quotation service for subscribing members. If a public market
for our common stock does not develop, then investors may not be able to resell
the shares of our common stock that they have purchased and may lose all of
their investment. If we do establish a trading market for our common stock, the
market price of our common stock may be significantly affected by factors such
as actual or anticipated fluctuations in our operation results, general market
conditions and other factors. In addition, the stock market has from time to
time experienced significant price and volume fluctuations that have
particularly affected the market prices for the shares of developmental stage
companies, which may materially adversely affect the market price of our common
stock.

We do not intend to pay dividends on any investment in the
shares of stock of our company.

We have never paid any cash dividends and currently do not
intend to ever pay any cash dividends. To the extent that we require additional
funding currently not provided for in our financing plan, our funding sources
may prohibit the payment of a dividend. Because we do not intend to declare
dividends, any gain on an investment in our company will need to come through an
increase in the stocks price. This may never happen and investors may lose all
of their investment in our company.

Our common stock is a penny stock. Trading of our stock may
be restricted by the SECs penny stock regulations, which may limit a
shareholder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

---

- 11 

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.

FINRA sales practice requirements may also limit a
stockholders ability to buy and sell our stock.

In addition to the penny stock rules described above, the
Financial Industry Regulatory Authority (FINRA) has adopted rules that require
that in recommending an investment to a customer, a broker or 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, brokers or 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 brokers or dealers to recommend that their customers buy our
common stock, which may prevent you from reselling your shares and may cause the
price of the shares to decline.

---

ITEM 7: FINANCIAL STATEMENTS



Orca International Language Schools Inc.



|Report
      of Independent Registered Public Accounting Firm | F-1
|------------------------------------------------------------- | ---
|                                                              |    
|Balance
      Sheets                                          | F-2
|                                                              |    
|Statements
      of Operations                                | F-3
|                                                              |    
|Statements
      of Cash Flows                                | F-4
|                                                              |    
|Statement
      of Stockholders Equity (Deficit)             | F-5
|                                                              |    
|Notes
      to the Financial Statements                       | F-6

---

logo

Report of Independent Registered Public AccountingFirm

To the Stockholders and Directors 
  of Orca International
  Language Schools Inc. 
  (A Development Stage Company)

We have audited the accompanying balance sheets of Orca
  International Language Schools Inc. (A Development Stage Company) as of March
  31, 2008 and 2007 and the related statements of operations, cash flows and
  stockholders equity (deficit) for the years then ended and accumulated for the
  period from November 6, 1997 (Date of Inception) to March 31, 2008. These
  financial statements are the responsibility of the Companys management. Our
  responsibility is to express an opinion on these financial statements based on
  our audits.

We conducted our audits in accordance with the Standards of the
  Public Company Accounting Oversight Board (United States). Those standards
  require that we plan and perform the audits to obtain reasonable assurance about
  whether the financial statements are free of material misstatement. An audit
  includes examining, on a test basis, evidence supporting the amounts and
  disclosures in the financial statements. An audit also includes assessing the
  accounting principles used and significant estimates made by management, as well
  as evaluating the overall financial statement presentation. We believe that our
  audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above
  present fairly, in all material respects, the financial position of Orca
  International Language Schools Inc. (A Development Stage Company) as of March
  31, 2008 and 2007, and the results of its operations and its cash flows for the
  years then ended and accumulated for the period from November 6, 1997 (Date of
  Inception) to March 31, 2008, in conformity with accounting principles generally
  accepted in the United States.

The accompanying financial statements have been prepared
  assuming the Company will continue as a going concern. As discussed in Note 1 to
  the financial statements, the Company has never generated any revenue and has
  accumulated operating losses. These factors raise substantial doubt about the
  Companys ability to continue as a going concern. Managements plans in regard
  to these matters are also discussed in Note 1. The financial statements do not
  include any adjustments that might result from the outcome of this uncertainty.

/s/ MANNING ELLIOTT LLP 
  CHARTERED ACCOUNTANTS

Vancouver, Canada

June 10, 2008

F-1

---

Orca International Language Schools Inc. 
  (A Development
  Stage Company) 
  Balance Sheets 
  (Expressed in US dollars)

|                                                                   |  | March 31 |   |  | March 31 |  
|------------------------------------------------------------------ |  | -------- | - |  | -------- | -
|                                                                   |  | 2008     |   |  | 2007     |  
|                                                                   |  | $        |   |  | $        |  
|                                                                   |  |          |   |  |          |  
|ASSETS                                                             |  |          |   |  |          |  
|Current Assets                                                     |  |          |   |  |          |  
|Cash                                                               |  | 3,592    |   |  | 14,225   |  
|Amounts receivable                                                 |  | 857      |   |  |         |  
|Prepaid expenses                                                   |  |         |   |  | 2,598    |  
|Total Current Assets                                               |  | 4,449    |   |  | 16,823   |  
|Property and Equipment (Note 3)                                    |  | 857      |   |  | 1,459    |  
|Total Assets                                                       |  | 5,306    |   |  | 18,282   |  
|                                                                   |  |          |   |  |          |  
|LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)                     |  |          |   |  |          |  
|Current Liabilities                                                |  |          |   |  |          |  
|Accounts payable                                                   |  | 7,964    |   |  | 2,151    |  
|Accrued liabilities (Note 4)                                       |  | 5,620    |   |  | 2,672    |  
|Due to related parties (Note 5(b))                                 |  | 11,326   |   |  | 2,203    |  
|Notes payable (Note 5(c))                                          |  | 35,071   |   |  |         |  
|Total Liabilities                                                  |  | 59,981   |   |  | 7,026    |  
|Contingencies (Note 1)                                             |  |          |   |  |          |  
|Stockholders Equity (Deficit)                                     |  |          |   |  |          |  
|Common Stock, Unlimited shares authorized,
      without par value |  |          |   |  |          |  
|6,271,210 shares issued and outstanding                            |  | 81,072   |   |  | 81,072   |  
|Subscriptions Receivable                                           |  |         |   |  | (1,732   | )
|Common Stock Subscribed (Note 6)                                   |  | 4,722    |   |  |         |  
|Donated Capital (Note 5(a))                                        |  | 16,208   |   |  | 7,495    |  
|Accumulated Other Comprehensive Income (Loss)                      |  | 441      |   |  | (866     | )
|Deficit Accumulated During the Development Stage                   |  | (157,118 | ) |  | (74,713  | )
|Total
      Stockholders Equity (Deficit)                         |  | (54,675  | ) |  | 11,256   |  
|Total Liabilities and Stockholders Equity (Deficit)               |  | 5,306    |   |  | 18,282   |  

(The accompanying notes are an integral part of these financial
  statements)

F-2

---

Orca International Language Schools Inc. 
  (A Development
  Stage Company) 
  Statements of Operations 
  (Expressed in US dollars)

|                                                |  | Accumulated      |   |  |           |   |  |           |  
|----------------------------------------------- |  | ---------------- | - |  | --------- | - |  | --------- | -
|                                                |  | from             |   |  |           |   |  |           |  
|                                                |  | November 6, 1997 |   |  | For the   |   |  | For the   |  
|                                                |  | (Date of         |   |  | Year      |   |  | Year      |  
|                                                |  | Inception) to    |   |  | Ended     |   |  | Ended     |  
|                                                |  | March 31,        |   |  | March 31, |   |  | March 31, |  
|                                                |  | 2008             |   |  | 2008      |   |  | 2007      |  
|                                                |  | $                |   |  | $         |   |  | $         |  
|                                                |  |                  |   |  |           |   |  |           |  
|                                                |  |                  |   |  |           |   |  |           |  
|                                                |  |                  |   |  |           |   |  |           |  
|Revenue                                         |  |                 |   |  |          |   |  |          |  
|                                                |  |                  |   |  |           |   |  |           |  
|Expenses                                        |  |                  |   |  |           |   |  |           |  
|                                                |  |                  |   |  |           |   |  |           |  
|Amortization                                    |  | 1,209            |   |  | 704       |   |  | 505       |  
|Automobile                                      |  | 25,090           |   |  | 7,024     |   |  | 5,207     |  
|General and administrative                      |  | 31,442           |   |  | 6,888     |   |  | 11,475    |  
|Interest                                        |  | 1,110            |   |  | 1,110     |   |  | -         |  
|Management fees (Note 5(a))                     |  | 14,721           |   |  | 5,809     |   |  | 3,133     |  
|Professional fees                               |  | 52,910           |   |  | 50,164    |   |  | 1,871     |  
|Rent (Note 5(a))                                |  | 10,399           |   |  | 2,904     |   |  | 2,635     |  
|Travel                                          |  | 21,183           |   |  | 7,802     |   |  | 8,711     |  
|                                                |  |                  |   |  |           |   |  |           |  
|Total Expenses                                  |  | 158,064          |   |  | 82,405    |   |  | 33,537    |  
|                                                |  |                  |   |  |           |   |  |           |  
|Net Loss from Operations                        |  | (158,064         | ) |  | (82,405   | ) |  | (33,537   | )
|                                                |  |                  |   |  |           |   |  |           |  
|Other Income                                    |  |                  |   |  |           |   |  |           |  
|                                                |  |                  |   |  |           |   |  |           |  
|Gain on
      disposal of temporary investments |  | 946              |   |  |          |   |  |          |  
|                                                |  |                  |   |  |           |   |  |           |  
|Net Loss                                        |  | (157,118         | ) |  | (82,405   | ) |  | (33,537   | )
|                                                |  |                  |   |  |           |   |  |           |  
|Other Comprehensive Income (Loss)               |  |                  |   |  |           |   |  |           |  
|                                                |  |                  |   |  |           |   |  |           |  
|Foreign currency translation adjustment         |  | 441              |   |  | 1,307     |   |  | 351       |  
|                                                |  |                  |   |  |           |   |  |           |  
|Comprehensive
      Loss                        |  | (156,677         | ) |  | (81,098   | ) |  | (33,186   | )
|                                                |  |                  |   |  |           |   |  |           |  
|Net Loss Per
      Share  Basic and Diluted    |  |                  |   |  | (0.01     | ) |  | (0.01     | )
|                                                |  |                  |   |  |           |   |  |           |  
|Weighted Average
      Shares Outstanding       |  |                  |   |  | 6,271,000 |   |  | 5,694,000 |  

(The accompanying notes are an integral part of these financial
  statements)

F-3

---

Orca International Language Schools Inc. 
  (A Development
  Stage Company) 
  Statements of Cash Flows 
  (Expressed in US dollars)

|                                                                      |  | Accumulated         |   |  |           |   |  |           |  
|--------------------------------------------------------------------- |  | ------------------- | - |  | --------- | - |  | --------- | -
|                                                                      |  | From                |   |  |           |   |  |           |  
|                                                                      |  | November 6, 1997    |   |  | For the   |   |  | For the   |  
|                                                                      |  | (Date of Inception) |   |  | Year      |   |  | Year      |  
|                                                                      |  | To                  |   |  | Ended     |   |  | Ended     |  
|                                                                      |  | March 31,           |   |  | March 31, |   |  | March 31, |  
|                                                                      |  | 2008                |   |  | 2008      |   |  | 2007      |  
|                                                                      |  | $                   |   |  | $         |   |  | $         |  
|                                                                      |  |                     |   |  |           |   |  |           |  
|                                                                      |  |                     |   |  |           |   |  |           |  
|Operating Activities                                                  |  |                     |   |  |           |   |  |           |  
|                                                                      |  |                     |   |  |           |   |  |           |  
|Net loss                                                              |  | (157,118            | ) |  | (82,405   | ) |  | (33,537   | )
|Adjustments to reconcile net loss to net cash
      used in operating |  |                     |   |  |           |   |  |           |  
|activities:                                                           |  |                     |   |  |           |   |  |           |  
|Amortization                                                          |  | 1,209               |   |  | 704       |   |  | 505       |  
|Donated services
      and rent                                       |  | 16,208              |   |  | 8,713     |   |  | 2,635     |  
|Gain on sale of temporary
      investments                           |  | (946                | ) |  |          |   |  |          |  
|Changes in operating assets
      and liabilities:                    |  |                     |   |  |           |   |  |           |  
|Prepaid expenses                                                      |  | (1,329              | ) |  | 2,923     |   |  | (2,598    | )
|Accounts
      receivable                                             |  | (781                | ) |  | (781      | ) |  |          |  
|Accounts payable and accrued
      liabilities                        |  | 12,973              |   |  | 8,160     |   |  | 3,956     |  
|Due to related party                                                  |  | 12,647              |   |  | 8,847     |   |  | (3,906    | )
|Net Cash Used In
      Operating Activities                           |  | (117,137            | ) |  | (53,840   | ) |  | (32,945   | )
|Investing Activities                                                  |  |                     |   |  |           |   |  |           |  
|Purchase of temporary
      investments                               |  | (1,785              | ) |  |          |   |  |          |  
|Proceeds from
      sale of temporary investments                     |  | 2,795               |   |  |          |   |  |          |  
|Purchase of property and equipment                                    |  | (1,957              | ) |  |          |   |  | (1,957    | )
|Net Cash Provided Used In Investing Activities                        |  | (947                | ) |  |          |   |  | (1,957    | )
|                                                                      |  |                     |   |  |           |   |  |           |  
|Financing Activities                                                  |  |                     |   |  |           |   |  |           |  
|Proceeds from notes payable                                           |  | 35,071              |   |  | 35,071    |   |  |          |  
|Proceeds from
      issuance of common stock                          |  | 81,072              |   |  | 1,732     |   |  | 48,286    |  
|Proceeds from common stock subscribed                                 |  | 4,722               |   |  | 4,722     |   |  |          |  
|Net Cash Flows Provided by Financing Activities                       |  | 120,865             |   |  | 41,525    |   |  | 48,286    |  
|Effect of Exchange
      Rate Changes on Cash                         |  | 811                 |   |  | 1,682     |   |  | 422       |  
|Increase (Decrease) In Cash                                           |  | 3,592               |   |  | (10,633   | ) |  | 13,806    |  
|Cash  Beginning
      of Period                                      |  |                    |   |  | 14,225    |   |  | 419       |  
|Cash  End of Period                                                  |  | 3,592               |   |  | 3,592     |   |  | 14,225    |  
|                                                                      |  |                     |   |  |           |   |  |           |  
|Supplemental Disclosures                                              |  |                     |   |  |           |   |  |           |  
|Interest paid                                                         |  |                    |   |  |          |   |  |          |  
|Income taxes paid                                                     |  |                    |   |  |          |   |  |          |  

(The accompanying notes are an integral part of these financial
  statements)

F-4

---

Orca International Language Schools Inc. 
  (A Development
  Stage Company) 
  Statement of Stockholders Equity (Deficit) 
  From November
  6, 1997 (Date of Inception) to March 31, 2008 
  (Expressed in US dollars)

|                                      |  |              |  |  |        |  |  |               |   |  |            |  |  |         |  |  | Deficit     |   |  |               |   |  |         |  
|------------------------------------- |  | ------------ |  |  | ------ |  |  | ------------- | - |  | ---------- |  |  | ------- |  |  | ----------- | - |  | ------------- | - |  | ------- | -
|                                      |  |              |  |  |        |  |  |               |   |  |            |  |  |         |  |  | Accumulated |   |  | Accumulated   |   |  |         |  
|                                      |  | Common Stock |  |  |        |  |  |               |   |  |            |  |  | During  |  |  | Other       |   |  |               |  
|                                      |  |              |  |  | Par    |  |  |               |   |  | Common     |  |  | Donated |  |  | Development |   |  | Comprehensive |   |  |         |  
|                                      |  |              |  |  |        |  |  | Subscriptions |   |  | Stock      |  |  | Capital |  |  | Stage       |   |  | Income (Loss) |   |  | Total   |  
|                                      |  | Shares       |  |  | Value  |  |  | Receivable    |   |  | Subscribed |  |  |         |  |  |             |   |  |               |   |  |         |  
|                                      |  | #            |  |  | $      |  |  | $             |   |  | $          |  |  | $       |  |  | $           |   |  | $             |   |  | $       |  
|Balance  November 6, 1997 (Date      |  |              |  |  |        |  |  |               |   |  |            |  |  |         |  |  |             |   |  |               |   |  |         |  
|of Inception)                         |  |             |  |  |       |  |  |              |   |  |           |  |  |        |  |  |            |   |  |              |   |  |        |  
|Issuance of common shares for cash    |  |              |  |  |        |  |  |               |   |  |            |  |  |         |  |  |             |   |  |               |   |  |         |  
|at $1.00 per share                    |  | 1            |  |  | 1      |  |  |              |   |  |           |  |  |        |  |  |            |   |  |              |   |  | 1       |  
|Balance  March 31, 1998              |  | 1            |  |  | 1      |  |  |              |   |  |           |  |  |        |  |  |            |   |  |              |   |  | 1       |  
|Net loss for the period from April 1, |  |              |  |  |        |  |  |               |   |  |            |  |  |         |  |  |             |   |  |               |   |  |         |  
|1998 to March 31, 2003                |  |             |  |  |       |  |  |              |   |  |           |  |  |        |  |  |            |   |  |              |   |  |        |  
|Balance  March 31, 2003              |  | 1            |  |  | 1      |  |  |              |   |  |           |  |  |        |  |  |            |   |  |              |   |  | 1       |  
|Issuance of common shares for cash    |  |              |  |  |        |  |  |               |   |  |            |  |  |         |  |  |             |   |  |               |   |  |         |  
|at CDN$0.00001 per
      share        |  | 3,999,999    |  |  | 30     |  |  |              |   |  |           |  |  |        |  |  |            |   |  |              |   |  | 30      |  
|Balance  March 31, 2004              |  | 4,000,000    |  |  | 31     |  |  |              |   |  |           |  |  |        |  |  |            |   |  |              |   |  | 31      |  
|Issuance of common shares for cash    |  |              |  |  |        |  |  |               |   |  |            |  |  |         |  |  |             |   |  |               |   |  |         |  
|at CDN$0.02 per share                 |  | 1,650,000    |  |  | 27,281 |  |  |              |   |  |           |  |  |        |  |  |            |   |  |              |   |  | 27,281  |  
|Donated rent                          |  |             |  |  |       |  |  |              |   |  |           |  |  | 2,346   |  |  |            |   |  |              |   |  | 2,346   |  
|Foreign currency translation          |  |             |  |  |       |  |  |              |   |  |           |  |  |        |  |  |            |   |  | (1,093        | ) |  | (1,093  | )
|Net loss for the year                 |  |             |  |  |       |  |  |              |   |  |           |  |  |        |  |  | (21,596     | ) |  |              |   |  | (21,596 | )
|Balance  March 31, 2005              |  | 5,650,000    |  |  | 27,312 |  |  |              |   |  |           |  |  | 2,346   |  |  | (21,596     | ) |  | (1,093        | ) |  | 6,969   |  
|Issuance of common shares for cash    |  |              |  |  |        |  |  |               |   |  |            |  |  |         |  |  |             |   |  |               |   |  |         |  
|at CDN$0.10 per share                 |  | 43,710       |  |  | 3,742  |  |  |              |   |  |           |  |  |        |  |  |            |   |  |              |   |  | 3,742   |  
|Donated rent                          |  |             |  |  |       |  |  |              |   |  |           |  |  | 2,514   |  |  |            |   |  |              |   |  | 2,514   |  
|Foreign currency translation          |  |             |  |  |       |  |  |              |   |  |           |  |  |        |  |  |            |   |  | (124          | ) |  | (124    | )
|Net loss for the year                 |  |             |  |  |       |  |  |              |   |  |           |  |  |        |  |  | (19,580     | ) |  |              |   |  | (19,580 | )
|Balance  March 31, 2006              |  | 5,693,710    |  |  | 31,054 |  |  |              |   |  |           |  |  | 4,860   |  |  | (41,176     | ) |  | (1,217        | ) |  | (6,479  | )
|Issuance of common shares for cash    |  |              |  |  |        |  |  |               |   |  |            |  |  |         |  |  |             |   |  |               |   |  |         |  
|at CDN$0.10 per share                 |  | 577,500      |  |  | 50,018 |  |  | (1,732        | ) |  |           |  |  |        |  |  |            |   |  |              |   |  | 48,286  |  
|Donated rent                          |  |             |  |  |       |  |  |              |   |  |           |  |  | 2,635   |  |  |            |   |  |              |   |  | 2,635   |  
|Foreign currency translation          |  |             |  |  |       |  |  |              |   |  |           |  |  |        |  |  |            |   |  | 351           |   |  | 351     |  
|Net loss for the year                 |  |             |  |  |       |  |  |              |   |  |           |  |  |        |  |  | (33,537     | ) |  |              |   |  | (33,537 | )
|Balance  March 31, 2007              |  | 6,271,210    |  |  | 81,072 |  |  | (1,732        | ) |  |           |  |  | 7,495   |  |  | (74,713     | ) |  | (866          | ) |  | 11,256  |  
|Proceeds from subscription            |  |              |  |  |        |  |  |               |   |  |            |  |  |         |  |  |             |   |  |               |   |  |         |  
|receivable                            |  |             |  |  |       |  |  | 1,732         |   |  |           |  |  |        |  |  |            |   |  |              |   |  | 1,732   |  
|Common stock subscribed at            |  |              |  |  |        |  |  |               |   |  |            |  |  |         |  |  |             |   |  |               |   |  |         |  
|CDN$0.10 per share                    |  |             |  |  |       |  |  |              |   |  | 4,722      |  |  |        |  |  |            |   |  |              |   |  | 4,722   |  
|Donated services and rent             |  |             |  |  |       |  |  |              |   |  |           |  |  | 8,713   |  |  |            |   |  |              |   |  | 8,713   |  
|Foreign currency translation          |  |             |  |  |       |  |  |              |   |  |           |  |  |        |  |  |            |   |  | 1,307         |   |  | 1,307   |  
|Net loss for the year                 |  |             |  |  |       |  |  |              |   |  |           |  |  |        |  |  | (82,405     | ) |  |              |   |  | (82,405 | )
|Balance  March 31, 2008              |  | 6,271,210    |  |  | 81,072 |  |  |              |   |  | 4,722      |  |  | 16,208  |  |  | (157,118    | ) |  | 441           |   |  | (54,675 | )

(The accompanying notes are an integral part of these financial
  statements)

F-5

---

Orca International Language Schools Inc. 
  (A Development
  Stage Company) 
  Notes to the Financial Statements 
  (Expressed in US
  dollars) 
  March 31, 2008

|1. | Nature of Operations and Continuance of
      Business                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | Orca International Language Schools Inc. (the Company)
      was incorporated in British Columbia, Canada on November 6, 1997. The
      Company is a Development Stage Company, as defined by Statement of
      Financial Accounting Standard (SFAS) No. 7 Accounting and Reporting
        by Development Stage Enterprises. The Companys planned principal
      business is the acquisition and development of language education
      businesses.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | These financial statements have been prepared on a going
      concern basis, which implies the Company will continue to realize its
      assets and discharge its liabilities in the normal course of business. The
      Company has not generated revenues since inception and has never paid any
      dividends and is unlikely to pay dividends or generate earnings in the
      immediate or foreseeable future. The continuation of the Company as a
      going concern is dependent upon the continued financial support from its
      shareholders, the ability of the Company to obtain necessary equity
      financing to continue operations, and the attainment of profitable
      operations. As at March 31, 2008, the Company has a working capital
      deficiency of $55,532 and accumulated losses of $157,118 since inception.
      These factors raise substantial doubt regarding the Companys ability to
      continue as a going concern. These financial statements do not include any
      adjustments to the recoverability and classification of recorded asset
      amounts and classification of liabilities that might be necessary should
      the Company be unable to continue as a going concern.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | On August 7, 2007, the Company filed an SB-2 Registration
      Statement with the United States Securities and Exchange Commission, which
      was declared effective on September 13, 2007, to register 1,935,000 shares
      of common stock for sale by the Company at $0.10 per share for gross
      proceeds of $193,500. As at March 31, 2008, the Company has yet to raise
      any funds relating to the SB-2.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | The Company plans to commence providing services to
      schools and estimates operating expenses and working capital requirements
      for the next twelve month period to be approximately $100,000. The Company
      has no income from operations, and will require additional funds to
      implement its plans. There can be no assurance that the Company will be
      able to raise sufficient funds to pay the expected expenses for the next
      twelve months.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|2. | Summary of Significant Accounting
      Policies                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

F-6

---

Orca International Language Schools Inc. 
  (A Development
  Stage Company) 
  Notes to the Financial Statements 
  (Expressed in US
  dollars) 
  March 31, 2008

|2. | Summary of Significant Accounting Policies
      (continued)
|-- | ------------------------------------------------------------

| | b) | Use of Estimates                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |    | The preparation of financial statements in conformity
      with US generally accepted accounting principles requires management to
      make estimates and assumptions that affect the reported amounts of assets
      and liabilities and disclosure of contingent assets and liabilities at the
      date of the financial statements and the reported amounts of revenues and
      expenses during the reporting period. The Company regularly evaluates
      estimates and assumptions related to useful life and recoverability of
      long-lived assets, donated expenses, and deferred income tax valuation
      allowances. The Company bases its estimates and assumptions on current
      facts, historical experience and various other factors that it believes to
      be reasonable under the circumstances, the results of which form the basis
      for making judgments about the carrying values of assets and liabilities
      and the accrual of costs and expenses that are not readily apparent from
      other sources. The actual results experienced by the Company may differ
      materially and adversely from the Companys estimates. To the extent there
      are material differences between the estimates and the actual results,
      future results of operations will be affected.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | c) | Basic and Diluted Net Income (Loss) Per Share                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |    | The Company computes net income (loss) per share in
      accordance with SFAS No. 128, "Earnings per Share". SFAS No. 128
      requires presentation of both basic and diluted earnings per share (EPS)
      on the face of the income statement. Basic EPS is computed by dividing net
      income (loss) available to common shareholders (numerator) by the weighted
      average number of shares outstanding (denominator) during the period.
      Diluted EPS gives effect to all dilutive potential common shares
      outstanding during the period using the treasury stock method and
      convertible preferred stock using the if-converted method. In computing
      diluted EPS, the average stock price for the period is used in determining
      the number of shares assumed to be purchased from the exercise of stock
      options or warrants. Diluted EPS excludes all dilutive potential shares if
      their effect is anti dilutive. As at March 31, 2008, there are no dilutive
      potential common shares.                                                                                                                                                                                                                                                                                    
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | d) | Comprehensive Loss                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |    | SFAS No. 130, Reporting Comprehensive Income,
      establishes standards for the reporting and display of comprehensive loss
      and its components in the financial statements. As at March 31, 2008 and
      2007, the Companys only component of comprehensive income consisted of
      foreign currency translation adjustments.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | e) | Cash and Cash Equivalents                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |    | The Company considers all highly liquid instruments with
      maturity of three months or less at the time of issuance to be cash
      equivalents.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | f) | Property and Equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |    | Property and equipment consists of computer hardware, is
      recorded at cost and is depreciated on a straight line basis over an
      estimated useful life of three years.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

F-7

---

Orca International Language Schools Inc. 
  (A Development
  Stage Company) 
  Notes to the Financial Statements 
  (Expressed in US
  dollars) 
  March 31, 2008

|2. | Summary of Significant Accounting Policies
      (continued)
|-- | ------------------------------------------------------------

| | g) | Website Development Costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |    | The Company recognizes the costs associated with
      developing a website in accordance with the American Institute of
      Certified Public Accountants (AICPA) Statement of Position (SOP) No.
      98-1, Accounting for the Costs of Computer Software Developed or
        Obtained for Internal Use. The Company also follows the guidance
      pursuant to the Emerging Issues Task Force (EITF) No. 00-2, Accounting
        for Website Development Costs for website development costs incurred.
      The Company capitalizes website development costs that meet the
      capitalization criteria contained in SOP No. 98-1 unless recoverability of
      costs is not assured. To date the Company has charged all website
      development costs to operations.                                                                                                                                                                                                                   
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | h) | Long-Lived Assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |    | In accordance with SFAS No. 144, Accounting for the
      Impairment or Disposal of Long-Lived Assets, the Company tests
      long-lived assets or asset groups for recoverability when events or
      changes in circumstances indicate that their carrying amount may not be
      recoverable. Circumstances which could trigger a review include, but are
      not limited to: significant decreases in the market price of the asset;
      significant adverse changes in the business climate or legal factors;
      accumulation of costs significantly in excess of the amount originally
      expected for the acquisition or construction of the asset; current period
      cash flow or operating losses combined with a history of losses or a
      forecast of continuing losses associated with the use of the asset; and
      current expectation that the asset will more likely than not be sold or
      disposed significantly before the end of its estimated useful
      life.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |    | Recoverability is assessed based on the carrying amount
      of the asset and its fair value which is generally determined based on the
      sum of the undiscounted cash flows expected to result from the use and the
      eventual disposal of the asset, as well as specific appraisal in certain
      instances. An impairment loss is recognized when the carrying amount is
      not recoverable and exceeds fair value.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | i) | Financial Instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |    | The fair values of cash, accounts receivable, accounts
      payable, accrued liabilities, amounts due to related parties, and notes
      payable approximate their carrying values due to the immediate or short-
      term maturity of the financial instrument.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | j) | Income Taxes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |    | Potential benefits of income tax losses are not
      recognized in the accounts until realization is more likely than not. The
      Company has adopted SFAS No. 109 Accounting for Income Taxes as
      of its inception. Pursuant to SFAS No. 109 the Company is required to
      compute tax asset benefits for net operating losses carried forward.
      Potential benefit of net operating losses have not been recognized in
      these financial statements because the Company cannot be assured it is
      more likely than not it will utilize the net operating losses carried
      forward in future years.                                                                                                                                                                                                                                                                                                                                                                             

F-8

---

Orca International Language Schools Inc. 
  (A Development
  Stage Company) 
  Notes to the Financial Statements 
  (Expressed in US
  dollars) 
  March 31, 2008

|2. | Summary of Significant Accounting Policies
      (continued)
|-- | ------------------------------------------------------------

| | k) | Foreign Currency Translation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |    | The Companys functional currency is the Canadian dollar.
      The financial statements are translated to United States dollars in
      accordance with SFAS No. 52 Foreign Currency Translationusing
      period-end rates of exchange for assets and liabilities, and average rates
      of exchange for the year for revenues and expenses. Translation gains
      (losses) are recorded in accumulated other comprehensive income (loss) as
      a component of stockholders equity (deficit). Gains and losses arising on
      translation or settlement of foreign currency denominated transactions or
      balances are included in the determination of income. Foreign currency
      transactions are primarily undertaken in United States dollars. The
      Company has not, to the date of these financial statements, entered into
      derivative instruments to offset the impact of foreign currency
      fluctuations.                                                                                                                                                                                                                                                                                                                                                                          
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | l) | Stock-based Compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |    | The Company records stock-based compensation in
      accordance with SFAS No. 123R Share Based Payments, using the
      fair value method. The Company has not issued any stock options and has
      had no unvested share based payments since inception.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | m) | Recent Accounting Pronouncements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |    | In March 2008, the Financial Accounting Standards Board
      (FASB) issued SFAS No. 161, Disclosures about Derivative Instruments
        and Hedging Activities  an amendment to FASB Statement No. 133. SFAS
      No. 161 is intended to improve financial standards for derivative
      instruments and hedging activities by requiring enhanced disclosures to
      enable investors to better understand their effects on an entity's
      financial position, financial performance, and cash flows. Entities are
      required to provide enhanced disclosures about: (a) how and why an entity
      uses derivative instruments; (b) how derivative instruments and related
      hedged items are accounted for under Statement 133 and its related
      interpretations; and (c) how derivative instruments and related hedged
      items affect an entitys financial position, financial performance, and
      cash flows. It is effective for financial statements issued for fiscal
      years beginning after November 15, 2008, with early adoption encouraged.
      The Company is currently evaluating the impact of SFAS No. 161 on its
      financial statements, and the adoption of this statement is not expected
      to have a material effect on the Companys financial statements.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |    | In December 2007, the FASB issued SFAS No. 141R,
      Business Combinations. This statement replaces SFAS 141 and
      defines the acquirer in a business combination as the entity that obtains
      control of one or more businesses in a business combination and
      establishes the acquisition date as the date that the acquirer achieves
      control. SFAS 141R requires an acquirer to recognize the assets acquired,
      the liabilities assumed, and any non-controlling interest in the acquiree
      at the acquisition date, measured at their fair values as of that date.
      SFAS 141R also requires the acquirer to recognize contingent consideration
      at the acquisition date, measured at its fair value at that date. This
      statement is effective for fiscal years, and interim periods within those
      fiscal years, beginning on or after December 15, 2008. Earlier adoption is
      prohibited. The adoption of this statement is not expected to have a
      material effect on the Company's financial
      statements.                                                                                                                                                                                                                                              

F-9

---

Orca International Language Schools Inc. 
  (A Development
  Stage Company) 
  Notes to the Financial Statements 
  (Expressed in US
  dollars) 
  March 31, 2008

|2. | Summary of Significant Accounting Policies
      (continued)
|-- | ------------------------------------------------------------

| | m) | Recent Accounting Pronouncements (continued)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |    | In December 2007, the FASB issued SFAS No. 160,
      Noncontrolling Interests in Financial Statements Liabilities an
        Amendment of ARB No. 51. This statement amends ARB 51 to establish
      accounting and reporting standards for the Noncontrolling interest in a
      subsidiary and for the deconsolidation of a subsidiary. This statement is
      effective for fiscal years, and interim periods within those fiscal years,
      beginning on or after December 15, 2008. Earlier adoption is prohibited.
      The adoption of this statement is not expected to have a material effect
      on the Company's financial statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |    | In February 2007, the FASB issued SFAS No. 159, The
      Fair Value Option for Financial Assets and Financial Liabilities 
      Including an Amendment of FASB Statement No. 115. This statement
      permits entities to choose to measure many financial instruments and
      certain other items at fair value. Most of the provisions of SFAS No. 159
      apply only to entities that elect the fair value option. However, the
      amendment to SFAS No. 115 Accounting for Certain Investments in Debt
        and Equity Securities applies to all entities with available-for-sale
      and trading securities. SFAS No. 159 is effective as of the beginning of
      an entitys first fiscal year that begins after November 15, 2007. Early
      adoption is permitted as of the beginning of a fiscal year that begins on
      or before November 15, 2007, provided the entity also elects to apply the
      provision of SFAS No. 157, Fair Value Measurements.The adoption
      of this statement is not expected to have a material effect on the
      Company's financial statements.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |    | In September 2006, the FASB issued SFAS No. 157, Fair
      Value Measurements. The objective of SFAS No. 157 is to increase
      consistency and comparability in fair value measurements and to expand
      disclosures about fair value measurements. SFAS No. 157 defines fair
      value, establishes a framework for measuring fair value in generally
      accepted accounting principles, and expands disclosures about fair value
      measurements. SFAS No. 157 applies under other accounting pronouncements
      that require or permit fair value measurements and does not require any
      new fair value measurements. The provisions of SFAS No. 157 are effective
      for fair value measurements made in fiscal years beginning after November
      15, 2007. The adoption of this statement is not expected to have a
      material effect on the Company's financial
      statements.                                                                                                                                                                                                   

|3. | Property and Equipment
|-- | ----------------------

| |                    |  |       |  |  |              |  |  | March 31,    |  |  | March 31,    | 
| | ------------------ |  | ----- |  |  | ------------ |  |  | ------------ |  |  | ------------ | 
| |                    |  |       |  |  |              |  |  | 2008         |  |  | 2007         | 
| |                    |  |       |  |  | Accumulated  |  |  | Net Carrying |  |  | Net Carrying | 
| |                    |  | Cost  |  |  | Amortization |  |  | Value        |  |  | Value        | 
| |                    |  | $     |  |  | $            |  |  | $            |  |  | $            | 
| | Computer equipment |  | 2,126 |  |  | 1,269        |  |  | 857          |  |  | 1,459        | 

F-10

---

Orca International Language Schools Inc. 
  (A Development
  Stage Company) 
  Notes to the Financial Statements 
  (Expressed in US
  dollars) 
  March 31, 2008

|4. | Accrued Liabilities                                                                                                                                               
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                   
|   | At March 31, 2008, accrued liabilities of $5,620 consist
      of $4,510 (2007 - $2,672) of professional fees, and $1,110 (2007 - $nil)
      of accrued interest.
|   |                                                                                                                                                                   
|5. | Related Party Transactions                                                                                                                                        
|   |                                                                                                                                                                   
|   | a)                                                                                                                                                                
|   |                                                                                                                                                                   
|   | b)                                                                                                                                                                
|   |                                                                                                                                                                   
|   | c)                                                                                                                                                                
|   |                                                                                                                                                                   
|6. | Common Stock                                                                                                                                                      
|   |                                                                                                                                                                   
|   | a)                                                                                                                                                                
|   |                                                                                                                                                                   
|   | b)                                                                                                                                                                

F-11

---

Orca International Language Schools Inc. 
  (A Development
  Stage Company) 
  Notes to the Financial Statements 
  (Expressed in US
  dollars) 
  March 31, 2008

|7. | Income Taxes                                                                                                                                                                                                                                                                                              
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                           
|   | Potential benefits of income tax losses are not
      recognized in the accounts until realization is more likely than not. The
      Company ha adopted SFAS No. 109, Accounting for Income Taxes, as
      of its inception. The Company has not incurred non-capital losses as
      scheduled below:

Year of
      
      
      
      
      Year ofLoss
      
      Amount
      
      
      Expiration2005
      $
      18,251
      
      
      20152006
      
      18,043
      
      
      20262007
      
      28,375
      
      
      20272008
      
      73,240
      
      
      2028$
      137,909


Pursuant to SFAS No. 109, the Company
  is required to compute tax asset benefits for non-capital losses carried
  forward. Potential benefit of non-capital losses have not been recognized in
  these financial statements because the Company cannot be assured it is more
  likely than not it will utilize the losses carried forward in future years.

The reconciliation of income tax
  attributable to continuing operations to income tax expense computed at the
  statutory tax rates of 34% is:

| |                                                      |  | 2008    |   |  | 2007   |  
| | ---------------------------------------------------- |  | ------- | - |  | ------ | -
| |                                                      |  | $       |   |  | $      |  
| | Income tax benefit computed at statutory
      rates |  | 28,117  |   |  | 11,443 |  
| | Permanent differences                                |  | (3,098  | ) |  | (1,711 | )
| | Temporary differences                                |  | (29     | ) |  | (50    | )
| | Unrecognized tax
      losses                        |  | (24,990 | ) |  | (9,682 | )
| | Provision for income taxes                           |  |        |   |  |       |  

Significant components of the Companys
  deferred tax assets and liabilities, after applying enacted corporate income tax
  rates, are as follows:

| |                               |  | 2008    |   |  | 2007    |  
| | ----------------------------- |  | ------- | - |  | ------- | -
| |                               |  | $       |   |  | $       |  
| | Deferred income tax assets    |  |         |   |  |         |  
| | Net losses carried forward    |  | 47,842  |   |  | 22,065  |  
| | Other                         |  | 434     |   |  | 370     |  
| | Valuation
      allowance     |  | (48,276 | ) |  | (22,435 | )
| | Net deferred income tax asset |  |        |   |  |        |  

F-12

---

Orca International Language Schools Inc. 
  (A Development
  Stage Company) 
  Notes to the Financial Statements 
  (Expressed in US
  dollars) 
  March 31, 2008

|8. | Subsequent Event
|-- | ----------------

On April 8, 2008, three shareholders
  agreed to return for cancellation an aggregate of 1,200,000 shares of common
  stock to treasury for no consideration.











F-13

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- 14 -

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE.

We engaged the firm of Manning Elliott LLP, Chartered
Accountants (Manning Elliott), to audit our financial statements as of March
31, 2008 and March 31, 2007 and for the years then ended and accumulated for the
period from November 6, 1997 (date of inception) to March 31, 2008. There has
been no change in the accountants and no disagreements with Manning Elliott on
any matter of accounting principles or practices, financial statement
disclosure, or auditing scope procedure

Item 8A. Controls and Procedures.

Our management evaluated the effectiveness of our disclosure
controls and procedures as of March 31, 2008 as defined in Rules 13a-15(e) and
15d-15(e) under the Securities Exchange Act of 1934, as amended, or the Exchange
Act. Our management recognizes that any controls and procedures, no matter how
well designed and operated, can provide only reasonable assurance of achieving
their objectives and management necessarily applies its judgment in evaluating
the cost-benefit relationship of possible controls and procedures. Based on the
evaluation of our disclosure controls and procedures as of March 31, 2008, our
Principal Executive Officer, who also is our Principal Financial Officer,
concluded that, as of such date, our disclosure controls and procedures were
effective to assure that information required to be declared by us in reports
that we file or submit under the Exchange Act is (1) recorded, processed,
summarized, and reported within the periods specified in the SECs rules and
forms and (2) accumulated and communicated to our management, including our
Chief Executive Officer/principal financial officer, as appropriate, to allow
timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining
adequate internal control over financial reporting, as such term is defined in
Exchange Act Rules 13a-15(f). Under the supervision and with the participation
of management, including our principal executive officer, who is our also our
principle financial officer, we conducted an evaluation of the effectiveness of
our internal control over financial. Based on our evaluation, our management
concluded that our internal control over financial reporting was effective as of
March 31, 2008.

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 Securities and Exchange Commission for newly
public companies.

There was no change in our internal control over financial
reporting during our fourth fiscal quarter ended March 31, 2008 that has
materially affected, or is reasonably likely to materially affect, our internal
control over financial reporting.

Item 8B. Other Information.

None.

---

- 15 -

PART III

ITEM 9: DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS

Directors and Executive Officers, Promoters and Control
Persons

All directors of our company hold office until the next annual
meeting of the stockholders or until their successors have been elected and
qualified. The executive officers of our company are appointed by our board of
directors and hold office until their death, resignation or removal from office.
Our directors and executive officers, their ages, positions held, and
duration as such, are as follows:

Name
      Position Held with the Company
      Age
      Date First Elected or AppointedStuart Wooldridge
    President, Secretary and Director
    47
    May 2, 2003Qiang Benjamin Han
    Director
    25
    July 31, 2007Paul Clark
    Director
    46
    July 31, 2007Sherri Macdonald
    Director
    44
    July 31, 2007


Set forth below is a brief description of the background and
business experience of each of our directors and executive officers for the past
five years:

Stuart Wooldridge  President, Secretary and Director

Stuart Wooldridge was appointed as our President, Secretary and
Director on May 2, 2003. Since January, 1993 he has been a self employed
business consultant working with companies in the petroleum, automotive, and
software sectors. He is a director and Audit Committee Chair of Vendtek Systems
Inc., a company listed on the Toronto Stock Exchanges Venture Exchange. He is a
director of Yuntone Capital Corporation, a Capital Pool Company that is
preparing a prospectus for listing on the TSX Venture Exchange. Since 2002, he
has designed curriculum, served as Area Chair of Business, and taught domestic
and international students at the University of Phoenix and the New York
Institute of Technology. In 2006, he was awarded the Sperling Award for Teaching
Excellence. He spends approximately 20 hours, or 50%, of his business time on
the management of our company weekly.

He graduated with a Bachelor of Commerce degree from the
University of British Columbia in April, 1984 and a Masters of Business
Administration degree from the University of British Columbia in November 1992.

Qiang Benjamin Han - Director

Qiang Benjamin Han was appointed as a Director on July 31,
2007. He earned his Master of Business Administration degree from NYIT in August
2006.

From May 2006 to April 2007, he was the chief representative
and general manager of Beijing Blenz Coffee Ltd., responsible for development of
franchised coffee restaurants in China. From 2004 to 2006, he was an
international student assistant for Kwantlen University in Vancouver, British
Columbia. Mr. Han plans to dedicate approximately 4 hours a week to the affairs
of our company.

Paul Clark - Director

Paul Clark was appointed as a Director on July 31, 2007.

---

- 16 -

Since 1999, he has provided marketing consulting and research
services to clients wishing to expand their operations in China. He is fluent in
Mandarin, and resided in Shanghai frequently since 1990. His experience also
includes teaching as a sessional instructor with Thompson Rivers University in
Kamloops, British Columbia.

He graduated with a Bachelor of Arts degree from the University
of Victoria in April 1987 and earned his Masters of Business Administration
degree from the Ivey School of Business in April 2002. Mr. Clark plans to
dedicate approximately 4 hours a week to the affairs of our company.

Sherri Macdonald - Director

Sherri Macdonald was appointed as a Director on July 31, 2007.

Sherri Macdonald has experience in project management in both
business and not-for-profit sectors. In the course of her duties as the
president of a private holding company she oversees the management of diverse
investments and businesses including land holdings, a manufacturing company and
a stock portfolio.

Since 1999, she has managed private holding companies in a
number of industries in the Summerland BC region. Between 2000 and 2004 she was
regional manager for Junior Achievement BC. She graduated with a Bachelor of
Science (Honours) in November 1986 and a Master of Public Administration in
November 1991, both from the University of Victoria.

She is a director and Compensation Committee Chairperson of
Vendtek Systems Inc., a company listed on the Toronto Stock Exchanges Venture
Exchange. She will devote approximately four hours per week on company business.

Significant Employees

Currently our only employee is Stuart Wooldridge our President,
Secretary and Director. At present we do not anticipate hiring employees in the
near future. However, we will hire independent contractors.

Family Relationships

There are no family relationships among our directors or
officers.

Involvement in Certain Legal Proceedings.

Our directors, executive officers and control persons have not
been involved in any of the following events during the past five years:

| | 1. | Any bankruptcy petition filed by or against any business
      of which such person was a general partner or executive officer either at
      the time of the bankruptcy or within two years prior to that
  time;                                                                                             
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                 
| | 2. | Any conviction in a criminal proceeding or being subject
      to a pending criminal proceeding (excluding traffic violations and other
      minor offenses) ;                                                                                                                                                 
| |    |                                                                                                                                                                                                                                                                                                                 
| | 3. | Being subject to any order, judgment, or decree, not
      subsequently reversed, suspended or vacated, of any court of competent
      jurisdiction, permanently or temporarily enjoining, barring, suspending or
      otherwise limiting his involvement in any type of business, securities or
      banking

---

- 17 -

| |    | activities; and                                                                                                                                                                                                                                                                      
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                      
| | 4. | Being found by a court of competent jurisdiction (in a
      civil action) , the Commission or the Commodity Futures Trading Commission
      to have violated a federal or state securities or commodities law, and the
      judgment has not been reversed, suspended, or
vacated.

Compliance with Section 16(a) of the Securities Exchange Act
of 1934

Section 16(a) of the Exchange Act requires our executive
officers and directors and persons who own more than 10% of a registered class
of our equity securities to file with the SEC initial statements of beneficial
ownership, reports of changes in ownership and annual reports concerning their
ownership of our common stock and other equity securities, on Forms 3, 4 and 5
respectively. Executive officers, directors and greater than 10% shareholders
are required by the SEC regulations to furnish us with copies of all Section
16(a) reports that they file.

Based solely on our review of the copies of such forms received
by us, or written representations from certain reporting persons, we believe
that all filing requirements applicable to our officers, directors and greater
than 10% beneficial owners were complied with, with the exception of the
following:

Name
    Number of LateReports
    Number of TransactionsNot
      Reported ona Timely Basis
    Failure to FileRequestedFormsStuart Wooldridge
    1
    1
    N/AQiang Benjamin Han
    1 (1)
    1 (1)
    1 (1)Paul Clark
    1(2)
    1(2)
    1(2)Sherri Macdonald
    1
    1
    N/AKevin James
    1
    1
    N/A


1Mr. Han has not filed any
insider reports 2Mr. Clark has not filed any insider reports

Code of Ethics

We have not yet adopted a Code of Ethics but intend to do so in
the near future.

Committees of the Board of Directors

All proceedings of the board of directors for the year from
inception to March 31, 2008, were conducted by resolutions consented to in
writing by the board of directors and filed with the minutes of the proceedings
of the directors. Our company currently does not have nominating, compensation
or audit committees or committees performing similar functions nor does our
company have a written nominating, compensation or audit committee charter. Our
board of directors does not believe that it is necessary to have such committees
because it believes that the functions of such committees can be adequately
performed by the board of directors.

Our company does not have any defined policy or procedural
requirements for shareholders to submit recommendations or nominations for
directors. The board of directors believes that, given the stage of our
development, a specific nominating policy would be premature and of little
assistance until our business

---

- 18 -

operations develop to a more advanced level. Our company does
not currently have any specific or minimum criteria for the election of nominees
to the board of directors and we do not have any specific process or procedure
for evaluating such nominees. The board of directors will assess all candidates,
whether submitted by management or shareholders, and make recommendations for
election or appointment.

A shareholder who wishes to communicate with our board of
directors may do so by directing a written request addressed to our President,
Stuart Wooldridge, at the address appearing on the first page of this annual
report.

ITEM 10. EXECUTIVE COMPENSATION.

The particulars of compensation paid to the following persons:

|(a) | our principal executive officer;                                                                                                                                                                                                    
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                     
|(b) | each of our two most highly compensated executive
      officers who were serving as executive officers at the end of the year
      ended March 31, 2008; and                                                                      
|    |                                                                                                                                                                                                                                     
|(c) | up to two additional individuals for whom disclosure
      would have been provided under (b) but for the fact that the individual
      was not serving as our executive officer at the end of the year ended
      March 31, 2007,

who we will collectively refer to as our named executive
officers, of our company for the years ended March 31, 2008 and 2007 are set out
in the following summary compensation table, except that no disclosure is
provided for any named executive officer, other than our principal executive
officer, whose total compensation does not exceed $100,000 for the respective
fiscal year:

SUMMARY COMPENSATION
        TABLEName andprincipalposition(a)
      Year(b)
      Salary($)(c)
      Bonus($)(d)
      StockAwards($)(e)
      OptionAwards($)(f)
      Non-EquityIncentive PlanCompensation($)(g)
      NonqualifiedDeferredCompensationEarnings ($)(h)
      All OtherCompensation($)(i)
      Total($)(j)Stuart 
        Wooldridge(1)
      2008
        
        2007
      Nil
        
        3,133
      Nil
        
        Nil
      Nil
        
        Nil
      Nil
        
        Nil
      Nil
        
        Nil
      Nil
        
        Nil
      Nil
        
        Nil
      Nil
        
        3,133


|1 | Stuart Wooldridge was appointed as our President,
      Secretary and Director on May 2, 2003. Mr. Wooldridge received
      compensation in form of management service fees from our company.
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Outstanding Equity Awards at Fiscal Year-End

As at March 31, 2008, we had not adopted any equity
compensation plan and no stock, options, or other equity securities were awarded
to our principal executive officer or two other most highly compensated
executive officers.

Compensation of Directors

We have no formal plan for compensating our directors for their
service in their capacity as directors, although such directors are expected in
the future to receive stock options to purchase common shares as awarded by our
board of directors or (as to future stock options) a compensation committee
which may be established. Directors are entitled to reimbursement for reasonable
travel and other out-of-pocket expenses incurred in connection with attendance
at meetings of our board of directors. Our board of directors may award special
remuneration to any director undertaking any special services on our behalf

---

- 19 -

other than services ordinarily required of a director. During
the year ended March 31, 2007, no director received and/or accrued any
compensation for their services as a director, including committee participation
and/or special assignments.

Employment Agreements with our Named Executive Officers

We have not entered into any employment agreement or consulting
agreements with our directors and executive officers. There are no arrangements
or plans in which we provide pension, retirement or similar benefits for
directors or executive officers. Our directors and executive officers may
receive stock options at the discretion of our board of directors in the future.
We do not have any material bonus or profit sharing plans pursuant to which cash
or non-cash compensation is or may be paid to our directors or executive
officers, except that stock options may be granted at the discretion of our
board of directors.

Pension, Retirement or Similar Benefit Plans

There are no arrangements or plans in which we provide pension,
retirement or similar benefits for directors or executive officers. We have no
material bonus or profit sharing plans pursuant to which cash or non-cash
compensation is or may be paid to our directors or executive officers, except
that stock options may be granted at the discretion of the board of directors or
a committee thereof.

ITEM 11: SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT AND RELATED STOCKHOLDER MATTERS

Securities Authorized for Issuance under Equity Compensation
Plans

We have not adopted a stock option plan and have not granted
any stock options. Accordingly, no stock based compensation has been recorded to
date.

Equity
        Compensation Plan InformationPlan category
      Number of securities to
        be issued upon exercise of outstanding options,
        warrants and rights
      Weighted-average exercise price of outstanding options, warrants
        and rights
      Number of securities remaining
        available for future issuance under equity compensation
        plans (excluding securities reflected in column
        (a))(a)
      (b)
      (c)Equity compensation plans approved by security
        holders
      Nil
      Nil
      NilEquity compensation plans not approved by security
        holders
      Nil
      Nil
      NilTotal
      Nil
      Nil
      Nil


Security ownership of certain beneficial owners.

As of July 8, 2008, there were 5,071,210 shares of our common
stock outstanding. The following table sets forth certain information known to
us with respect to the beneficial ownership of our common stock as of that date
by (i) each of our directors, (ii) each of our executive officers, and (iii) all
of our directors and executive officers as a group. Except as set forth in the
table below, there is no person known to us who beneficially owns more than 5%
of our common stock. Unless otherwise noted, we believe that each person has
sole investment and voting power (or shares such powers with his or her spouse)
with respect to the shares set forth in the following table:

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- 20 -

Title of Class of Shares
    Name and Address of
      beneficial owner
    Amount and Nature of
      Beneficial Ownership
    Percentage of
      Class(1)(2)common shares
    Paul Clark 1040  8th Avenue
      Salmon Arm, BC V1E 4A4
    5,000
    0.10%common shares
    Qian Benjamin Han Fang Zhuang
      Fang Cheng Yuan 1 Qu 1# Lou Ding Men 603, Feng Tai District,
      Beijing, P.R China Post Code:100078
    100,000
    1.97%common shares
    StuartWooldridge 1685  58A
      Street Delta, BC V4L 1X5
    4,206,210
    82.94%common shares
    Sherry MacDonald(3)1767 Keloka Drive Kelowna, BC V1Z 2Y3
    25,000
    0.49%Total Directors and Officers
      as a Group (4 persons)
    4,336,210
    85.51%


|1 | Regulation S-B under the Exchange Act, defines a
      beneficial owner of a security as 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 on
      June 9, 2008.
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2 | Based on 5,071,210 shares outstanding as of July 8,
      2008.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|3 | Ms. MacDonald holds her shares through her holding
      company, Trout Creek Point Holdings Ltd.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

On July 2, 2008, Messrs. Wooldridge, Han and Clark and Ms.
MacDonald entered into an agreement with SGB C&C Investment Ltd. to sell to
SGB C&C Investment an aggregate of 2,635,000 shares of common stock. The
purchase and sale of these shares of common stock is scheduled to complete on
July 24, 2008 and at that time, SGB C&C Investment Ltd. will own 51.96% of
our issued and outstanding shares of common stock and have effective control of
our company.

ITEM 12: CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND
DIRECTOR INDEPENDENCE

Transactions with Related Persons

Other than as listed below, no director, officer, principal
shareholder holding at least 5% of our common shares, or any family member
thereof, had any material interest, direct or indirect, in any transaction, or
proposed transaction, during the year ended March 31, 2008 in which the amount
involved in the transaction exceeded or exceeds the lesser of $120,000 or 1% of
the average of our total assets at year-end for the last three completed fiscal
years.

| | 1. | Mr. Stuart Wooldridge, our President, provides office
      premises to us valued at CDN$250 per month. During the year ended March
      31, 2008, donated rent of $2,904 was charged
to
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| |    | operations. During the year ended March 31, 2007, donated
      rent of $2,635 was charged to operations.                                                                                                                                                                                          
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                    
| | 2. | During the year ended March 31, 2008, we incurred $5,809
      for donated management services provided by Mr. Stuart Wooldridge, our
      President. During the year ended March 31, 2007, we incurred
      $3,133 for management services provided by Mr. Stuart Wooldridge, our
    President.
| |    |                                                                                                                                                                                                                                                                                                    
| | 3. | As at March 31, 2008, we owe $11,326 to Mr. Stuart
      Wooldridge, our President. As at March 31, 2007, we owed $2,203 to Mr.
      Stuart Wooldridge, our President. The amount owing is unsecured,
      non-interest bearing and is due on demand.                                            

During the year ended March 31, 2008, the President of
      the Company loaned the Company $14,613 (CDN $15,000), a company controlled
      by the President of the Company loaned the Company $15,587 (CDN $16,000)
      and a director of the Company loaned the Company a further $4,871 (CDN
      $5,000). These loans are repayable on dates falling between October 1,
      2008 and March 23, 2009. All of the notes bear interest at a rate of 10%
per annum and are secured by all of the assets of the Company.

Promoters

Our promoter is Stuart Wooldridge, our President, Secretary and
Director.

Director Independence

Our common stock is not listed on any stock exchange or
inter-dealer quotation system. For purposes of determining director
independence, we have applied the definitions set out in NASDAQ Rule 4200(a)(15)
(the Rule). Under the Rule, a director is not considered to be independent if
he or she is also an executive officer or employee of the company. The members
of our board of directors also act as executive officers so we currently do not
have any independent directors.

ITEM 13: EXHIBITS AND REPORTS

Exhibit Number
      Description3.1
      Articles of Incorporation
          (Incorporated by our reference to our registration statement on Form
          SB-2 filed on August 7, 2007)31.1*
      Certification pursuant to Rule
          13a-14(a) under the Securities Exchange Act of 193432.1*
      Certification
          pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906
          of the Sarbanes-Oxley Act of 2002


*filed herewith

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ITEM 14: PRINCIPAL ACCOUNTANT FEES AND SERVICES

Our principal accountant Manning Elliott LLP, Chartered
Accountants, rendered invoices to us during the fiscal periods indicated for the
following fees and services:

Audit Fees

The aggregate fees billed for the two most recently completed
fiscal years ended March 31, 2008 and 2007 for professional services rendered by
the principal accountant for the audit of our annual financial statements and
for the review of the financial statements included our quarterly reports on
Form 10-QSB were as follows:

|                                  |   | Year Ended March 31 | 
|--------------------------------- | - | ------------------- | 
|                                  |   | 2008                | 
|Audit Fees and Audit Related Fees | $ | 22,230              | 
|Tax Fees                          |   | Nil                 | 
|All Other Fees                    |   | Nil                 | 
|Total                             | $ | 22,230              | 

Policy on Pre-Approval by the Board of Services Performed by
Independent Auditors

We do not use Manning Elliott LLP for financial information
system design and implementation. These services, which include designing or
implementing a system that aggregates source data underlying the financial
statements or generates information that is significant to our financial
statements, are provided internally or by other service providers. We do not
engage Manning Elliott LLP to provide compliance outsourcing services.

Effective May 6, 2003, the Securities and Exchange Commission
adopted rules that require that before Manning Elliott LLP is engaged by us to
render any auditing or permitted non-audit related service, the engagement be:

- approved by our board of directors; or,
- entered into pursuant to pre-approval policies and procedures established
  by the board of directors, provided the policies and procedures are detailed
  as to the particular service, the board of directors is informed of each
  service, and such policies and procedures do not include delegation of the
  board of directors' responsibilities to management.

The board of directors pre-approves all services provided by
our independent auditors. All of the above services and fees were reviewed and
approved by the board of directors either before or after the respective
services were rendered.

The board of directors has considered the nature and amount of
fees billed by Manning Elliott LLP and believes that the provision of services
for activities unrelated to the audit is compatible with maintaining our
independence.

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SIGNATURES

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

ORCA INTERNATIONAL LANGUAGE SCHOOLS INC.

By:

*/s/ Stuart
Wooldridge*Stuart
WooldridgePresident, Secretary and Director(Principal Executive Officer,
acting Principal Financial Officer and Principal Accounting Officer)

July 14, 2008

Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on behalf of
the registrant and in the capacities and on the dates indicated.

By          */s/ Stuart
Wooldridge*
                  
Stuart
Wooldridge                 
President, Secretary and
Director                 
(Principal Executive Officer acting Principal Financial
Officer                 
and Principal Accounting
Officer) 
                
July 14, 2008

By:          */s/ Paul
Clark*
                  
Paul
Clark                 
Director 
                
July 14, 2008

By:          */s/ Sherri
Macdonald;*
                  
Sherri
Macdonald                 
Director 
                
July 14, 2008

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