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

                                    FORM 10-K
                ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                       THE SECURUTIES EXCHANGE ACT OF 1934

                   For the fiscal year ended December 31, 2008

                        Commission file number 333-145876


                             Descanso Agency, Inc.
             (Exact Name of Registrant as Specified in Its Charter)

           Nevada                                                20-8766002
(State or Other Jurisdiction of                               (I.R.S. Employer
 Incorporation or Organization)                              Identification No.)

                       4203 Genesee Avenue, Suite 103 #510
                               San Diego, CA 92117
               (Address of Principal Executive Offices & Zip Code)

                   Telephone: 775-352-4084 Fax: (775) 201-2790
                               (Telephone Number)

                          Copies of communications to:
                              Joseph I. Emas, ESQ.
                             1224 Washington Avenue
                             Miami Beach, FL. 33139
                            Telephone: (305) 531-1174
                               Fax: (305) 531-1274

           Securities registered pursuant to Section 12(b) of the Act:
                                      None

           Securities registered pursuant to section 12(g) of the Act:
                          Common Stock, $.001 par value

Indicate by check mark if the registrant is a well-known seasoned issuer, as
defined in Rule 405 of the Securities Act. Yes [ ] No [X]

Indicate by check mark if the registrant is not required to file reports
pursuant to Section 13 or Section 15(d) of the Act. Yes [ ] No [X]

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

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

Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of "large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer [ ]                        Accelerated filer [ ]
Non-accelerated filer [ ]                          Smaller reporting company [X]
(Do not check if a smaller reporting company)

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

As of February 27, 2009, the registrant had 9,250,000 shares of common stock
issued and outstanding. No market value has been computed based upon the fact
that no active trading market had been established.
<PAGE>
                              DESCANSO AGENCY, INC.
                                TABLE OF CONTENTS

                                                                        Page No.
                                                                        --------

                                     Part I

Item 1.   Business                                                           3
Item 1A.  Risk Factors                                                       6
Item 2.   Properties                                                         8
Item 3.   Legal Proceedings                                                  9
Item 4.   Submission of Matters to a Vote of Securities Holders              9

                                 Part II

Item 5.   Market for Common Equity and Related Stockholder Matters           9
Item 7.   Management's Discussion and Analysis of Financial Condition
          and Results of Operations                                         11
Item 8.   Financial Statements                                              15
Item 9.   Changes in and Disagreements with Accountants on Accounting
          and Financial Disclosure                                          26
Item 9A.  Controls and Procedures                                           26

                                Part III

Item 10.  Directors and Executive Officers                                  28
Item 11.  Executive Compensation                                            29
Item 12.  Security Ownership of Certain Beneficial Owners and Management    30
Item 13.  Certain Relationships and Related Transactions                    31
Item 14.  Principal Accounting Fees and Services                            31

                                 Part IV

Item 15.  Exhibits                                                          32

Signatures                                                                  32

                                       2
<PAGE>
                                     PART I

ITEM 1. BUSINESS

BACKGROUND

Since inception, our core business has been the intention of establishing a
Mexican specialized travel service company focusing on the fastest growing
segment of the travel industry: wedding and party destination travel. This type
of destination travel is defined as taking the common wedding or party and
transporting the entire event and its hosts and guests to a foreign location.
Our specialty will include two types of destination travelers: small and large
travel parties seeking stimulating and entertaining bachelor and bachelorette
locations at larger hotels, and travelers seeking quiet romantic weddings and
holiday getaway short trips at small boutique hotels. We plan to utilize the
extensive operational background in the travel business of Raul Getino, our
founding principal and sole officer and director, with over eighteen years
experience in travel companies, in order to complete this stage and expand our
business plan. Our director has designed and implemented marketing campaigns for
other travel companies utilizing his extensive knowledge in providing upscale
weddings, and specialized romantic getaways to boutique hotel destinations in
Mexico. He has successfully marketed these specialized wedding and romantic tour
packages to travel companies and wedding planners in Mexico and the United
States prior to our incorporation.

We need to be able to generate sufficient cash inflows to implement our business
plan. In 2008, world-wide negative financial events and a dramatic reduction in
investor and lender funding have affected our abilities to secure new sources of
cash flows. We have relied upon our director to loan funds necessary to advance
our business plan. We are now seeking outside sources of funding to replace the
funding provided by our director. While we seek additional funding, we will
attempt to implement our business plan at a reduced rate until new financial
resources are available. We will focus on raising additional monies through
sales of our equity securities or through loans from banks or third parties for
our cash flow needs.

During the next twelve months, we plan to continue at a slow pace to develop our
business and the implementation of our plan of operations. We will delay renting
any new facilities and purchasing any new physical assets. We will pay our
director's fees as our cash flow dictates. We intend to delay for six months
starting our Internet website and beginning marketing our services. We will also
delay hiring any employees or contracting with independent travel agents until
we start our Internet website and begin our marketing. We expect to operate at a
loss during the next twelve months.

After securing new funding, we plan to utilize the services of our founder and
two contract agents to make sales and handle customer service. Agent
compensation will be based on a contract basis from any bookings created
exclusively by the agent on an equal commission split. We will provide our
home-based agents with an 800 phone line and internet service to access our
website for sales to the agent's customers and be available to all customers for
customer service. Customer service is expected to be minimal during this stage
due to the automated nature of the website and the anticipated low level of site
usage.

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OUR TRAVEL AGENCY MODEL

We plan to go beyond the typical travel agency model. We intend to specialize in
and serve the "romantic destinations" growing travel market. We are interested
in providing our clients with direct access to the romantic hotels, restaurants,
exclusive secluded beaches and other services that we are familiar with. We do
not intend to act as a general merchant travel company, handling every type of
travel transaction. We intend to serve our niche clients through wedding
planners and other specialty travel companies, and directly to our future
individual travel clients seeking what we can deliver in Mexico: romantic
destinations. We will handle all of the arrangements in Mexico for our clients.

We intend to receive negotiated commissions and fees from the wedding planners,
travel companies, and travel suppliers in Mexico such as transportation
providers, hotels, entertainment brokers, and rental car agencies. We intend to
bundle the destination travel groups and individuals seeking our niche
destination travel services in order to allow us to negotiate directly with
those lodging, entertainment, and rental companies seeking our destination
travel clients. Our founder has experience in negotiating prices for destination
travel clients that include additional revenue for a travel company due to large
volume client traffic. We intend to utilize his experience in negotiating prices
for our niche destination travel clients which will include additional revenue
for our planned volume travel services.

TARGET MARKET

Our target market is wedding planners, other travel companies, and individuals
seeking to find unique romantic travel destinations in Mexico. As our founder
has worked in the past with wedding planners and travel agents in Canada, the
United States, and Mexico, we intend to market our proposed services directly to
his connections. In addition, we intend to utilize his experience with marketing
to the general traveling public to setup "800" style toll free telephone numbers
and an Internet destination travel site with a web based marketing program.

PRODUCTS AND SERVICES

Our business plan is to serve the niche market of couples seeking romantic
holiday destinations. This market is now a very large trend in Western Europe
and growing in the United States. With the high cost of weddings and hotels in
Western Europe, the Western Europeans now find it less expensive to utilize
specialized niche travel companies to arrange for a complete wedding party,
bachelor or bachelorette party, or romantic getaway to other countries. As an
example, in England it is less expensive to pay to take an entire wedding party
from London, fly everyone to Greece, and pay for their hotels, meals, beverages,
ground transportation, and entertainment than it is to hold the wedding in
England.

The news media are now regularly reporting on the growing trend in destination
travel. CBS news (also cbsnews.com) aired a segment on June 30, 2006 describing
the destination travel trend for bachelor and bachelorette parties from England
and Western Europe to take entire groups to hold these parties in Eastern
Europe, where low costs make it less expensive to travel to a party destination
than to hold the same style of party at home. At "dateculture.com", they
describe the growing trend of "stag weekends" for bachelor and bachelorette

                                       4
<PAGE>
parties that involve entire parties traveling from the United Kingdom to Eastern
Europe, and even to the United States and Canada for their "stag" parties. The
International Herald Tribune published articles on July 31, 2007 and August 6,
2007 regarding the growing trend for Japanese to take their entire wedding
parties to the United States and Western Europe as destination travel sites for
their weddings. "PressMediaWire.Com" has numerous articles about the increase in
destination weddings and related destination wedding party attire. Other
articles about the growing trend for Mexican destination weddings describe the
unique experience of Mexico's small boutique hotels and the Hispanic interest in
destination wedding packages may be found at "centredaily.com",
"lovetripper.com", "theopenpress.com". One can also find on the Internet,
numerous destination wedding sites, such as the "bahamabeachclub.com" describing
typical all-inclusive wedding packages in the Caribbean.

We plan to use our management's background, knowledge, and contacts to market in
the United States, Canada, and large cities in Mexico, similar types of
destination travel bachelor and bachelorette parties at larger hotels, and niche
wedding packages and specialized romantic getaways to boutique hotel
destinations in Mexico. We intend to market these specialized travel trips to
travel companies and wedding planners in Mexico and the United States.

We plan to use our management's extensive past working relationships and current
knowledge of numerous large hotels in Mexico's scenic inland and coastal tourist
locations for bachelor and bachelorette parties. For those destination travelers
seeking unique quieter, romantic stays, we will offer boutique hotel
destinations for weddings, and specialized romantic weekend getaways. These
boutique hotels include prime destinations such as the Flor de Maria in
Ensenada, Casa Natalia in San Jose del Cabo, the Maroma in Cancun, Blue Sky
Hotel in Tankah, and the Posada de las Flores in Loreto. All of these smaller
hotels, and many more, are actively seeking to provide services to the niche
market of romantic destination travelers.

MARKETING

We plan to use primarily interactive marketing media with a mix of traditional
methods to be rolled out at various stages of our development and as marketing
funds are made available. Marketing resources will be designed to attract
customers to our site, convert potential buyers to a sale, and develop a return
customer. In our first stage of development, marketing is planned to primarily
be direct contact with travel companies and wedding planners known to our
founder and by email campaigns to travel agencies and individual existing
destination travels personally known by our founder.

AGREEMENTS/SUPPLIERS

As of the date of this filing, we have no agreements with any travel suppliers,
consolidators, or travel-related software providers.

COMPETITION

We do not intend to directly compete in the general travel industry market. We
intend to stay in the niche market of destination travel, a rapidly growing
travel area in which our founder has numerous years of experience. He also has
direct contacts with many large and boutique Mexican hotels and Mexican service

                                       5
<PAGE>
providers, as well as contacts with wedding planners, travel companies, and
numerous individual destination travelers who have all used our founder's
services in the past.

Although the United States and Canada have many small and large travel companies
as well as the Internet-dominating big players such as Expedia, Priceline,
Orbitz, and Travelocity, we intend to seek niche opportunities in the market for
individualized upscale personalized destination travel services making us a
one-stop-shop destination travel company for Mexico. We believe we will be able
to compete with our personalized service, and our founders experience and
network of contacts in this market segment. We also plan to utilize Internet web
technology for marketing and links to our founder's existing travel contacts. We
intend to make our travel website easy to find, easy to use, and supported by
knowledgeable destination travel professionals in Mexico.

EMPLOYEES

Mr. Getino is currently our only employee, and we are dependent upon his ability
to execute our plan through our initial development stage. In April 2008 we
began paying him $300 per month. The amount has been accrued as an account
payable due to our limited funds.

REPORTS TO SECURITIES HOLDERS

We will file annual, quarterly and special reports, proxy statements and other
information with the Securities and Exchange Commission. You may read and copy
any reports, statement or other information that we file with the Commission at
the Commission's public reference rooms in Washington, D.C. Please call the
Commission at 1-800-SEC-0330 for further information on the public reference
rooms. These Commission filings are also available to the public from commercial
document retrieval services and at the Internet site maintained by the
Commission at http://www.sec.gov. We do not intend to distribute annual reports
or audited financial statements to our shareholders. This information may be
found in our filings with the Securities and Exchange Commission.

ITEM 1A. RISK FACTORS

WE HAVE A LIMITED OPERATING HISTORY THAT YOU CAN USE TO EVALUATE US, AND THE
LIKELIHOOD OF OUR SUCCESS MUST BE CONSIDERED IN LIGHT OF THE PROBLEMS, EXPENSES,
DIFFICULTIES, COMPLICATIONS AND DELAYS FREQUENTLY ENCOUNTERED BY A SMALL
DEVELOPING COMPANY.

We were incorporated in Nevada on April 3, 2007. We have no significant assets,
limited financial resources and no revenues to date. The likelihood of our
success must be considered in light of the problems, expenses, difficulties,
complications and delays frequently encountered by a small developing company
starting a new business enterprise and the highly competitive environment in
which we will operate. Since we have a limited operating history, we cannot
assure you that our business will be profitable or that we will ever generate
sufficient revenues to meet our expenses and support our anticipated activities.

                                       6
<PAGE>
OUR FUTURE SUCCESS IS DEPENDENT, IN PART, ON THE PERFORMANCE AND CONTINUED
SERVICE OF RAUL GETINO, OUR SOLE OFFICER AND DIRECTOR. WITHOUT HIS CONTINUED
SERVICE, WE MAY BE FORCED TO INTERRUPT OR EVENTUALLY CEASE OUR OPERATIONS.

We are presently dependent to a great extent upon the experience, abilities and
continued services of Raul Getino, our sole officer and director. We currently
do not have an employment agreement with Mr. Getino. The loss of his services
could have a material adverse effect on our business, financial condition or
results of operation.

OUR REVENUES AND EARNINGS ARE ESPECIALLY SENSITIVE TO GLOBAL EVENTS THAT ARE OUT
OF OUR CONTROL.

Our results of operations are dependent upon factors generally affecting the
travel industry. Our revenues and earnings are especially sensitive to events
that affect domestic and international air travel, tours, and vacations. A
number of factors could result in an overall decline in demand for travel,
including political instability, armed hostilities, international terrorism,
extreme weather conditions, a rise in fuel prices, labor disturbances, excessive
inflation, a general weakening in economic activity and reduced employment.
These types of events could have a material adverse effect on our business,
financial condition and results of operations.

THE DOMESTIC AND INTERNATIONAL LEISURE TRAVEL INDUSTRY IS SEASONAL AND SUBJECT
TO QUARTERLY FLUCTUATIONS CAUSED PRIMARILY BY THE SEASONAL VARIATIONS IN THE
TRAVEL INDUSTRY WHICH COULD HAVE A NEGATIVE EFFECT ON OUR QUARTERLY RESULTS OF
OPERATIONS.

The domestic and international leisure travel industry is seasonal. Our results
may be subject to quarterly fluctuations caused primarily by the seasonal
variations in the travel industry. It is anticipated that net revenues and net
income will generally be higher in the first and second quarters. Our quarterly
results of operations may also be subject to fluctuations as a result of changes
in the mix of services we offer as a result of internal growth rates, fare wars
by travel providers, changes in relationships with certain travel providers, the
timing of the payment of commissions by travel providers, extreme weather
conditions or other factors affecting travel. Unexpected variations in quarterly
results could also adversely affect the price of the common stock, which in turn
could limit our ability to expand.

THE TRAVEL SERVICE INDUSTRY IS EXTREMELY COMPETITIVE AND HAS LOW BARRIERS TO
ENTRY.

The travel service industry is extremely competitive and has low barriers to
entry. We will compete with other distributors of travel services, travel
providers, travel agents, tour operators and central reservation service
providers, some of which have greater experience and/or financial resources than
we do. Other distributors may have relationships with certain travel providers
providing better availability or more competitive pricing than that offered by
us. Furthermore, some travel agents have a strong presence in their geographic
area which may make it difficult for us to attract customers in those areas.

                                       7
<PAGE>
RAUL GETINO'S CONTROL MAY PREVENT YOU FROM CAUSING A CHANGE IN THE COURSE OF OUR
OPERATIONS AND MAY AFFECT THE PRICE OF OUR COMMON STOCK.

Raul Getino beneficially owns approximately 40% of our common stock. Due to his
controlling ownership, he will be able to elect our entire board of directors,
control all matters that require a stockholder vote and exercise a significant
amount of influence over our management and operations. This concentration of
ownership could result in a reduction in value to the common shares you own
because of the ineffective voting power, and could have the effect of preventing
us from undergoing a change of control in the future.

THERE IS NO ASSURANCE OF AN ACTIVE TRADING MARKET FOR OUR COMMON STOCK,
THEREFORE, INVESTORS MAY BE UNABLE TO LIQUIDATE ANY INVESTMENT THEY MAKE IN OUR
STOCK.

There is no established public trading market for our common stock. Our shares
are listed on the OTC Electronic Bulletin Board, however no active trading
market exists and there is no assurance that one will develop or that if
developed, will be sustained. In the absence of a trading market, an investor
may be unable to liquidate their investment.

OUR COMMON STOCK IS CONSIDERED A PENNY STOCK, WHICH IS SUBJECT TO RESTRICTIONS
ON MARKETABILITY. Our shares are subject to the penny stock rules adopted by the
Securities and Exchange Commission that require brokers to provide extensive
disclosure to their customers prior to executing trades in penny stocks. These
disclosure requirements may cause a reduction in the trading activity of our
common stock, which in all likelihood would make it difficult for our
shareholders to sell their securities.

WE WILL INCUR ONGOING COSTS AND EXPENSES FOR SEC REPORTING AND COMPLIANCE,
WITHOUT REVENUE WE MAY NOT BE ABLE TO REMAIN IN COMPLIANCE, MAKING IT DIFFICULT
FOR INVESTORS TO SELL THEIR SHARES, IF AT ALL.

To be eligible for quotation on the OTC Bulletin Board, issuers must remain
current in their filings with the SEC. In order for us to remain in compliance
we will require future revenues to cover the cost of these filings, which could
comprise a substantial portion of our available cash resources. If we are unable
to generate sufficient revenues to remain in compliance it may be difficult for
investors to resell any shares they purchase, if at all.

ITEM 2. PROPERTIES

Our property consists of office space located at 4203 Genesee, Suite 103 #510,
San Diego, CA 92117. We use such space for no charge from our president.
Currently, this space is sufficient to meet our needs; however, once we expand
our business to a significant degree, we will have to find a larger space.

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We currently have no investment policies as they pertain to real estate, real
estate interests or real estate mortgages.

ITEM 3. LEGAL PROCEEDINGS

We are not currently involved in any legal proceedings and we are not aware of
any pending or potential legal actions.

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

There were no matters submitted to a vote of the security holders during the
year ended December 31, 2008.

                                     PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

On January 11, 2008 we received our listing for quotation on the
Over-the-Counter Bulletin Board under the symbol "DSAY". To date there has not
been an active trading market.

PENNY STOCK RULES

The Securities and Exchange Commission has also adopted rules that regulate
broker-dealer practices in connection with transactions in penny stocks. Penny
stocks are generally equity securities with a price of less than $5.00 (other
than securities registered on certain national securities exchanges or quoted on
the Nasdaq system, provided that current price and volume information with
respect to transactions in such securities is provided by the exchange or
system).

Our shares are considered penny stock under the Securities and Exchange Act. The
shares will remain penny stocks for the foreseeable future. The classification
of penny stock makes it more difficult for a broker-dealer to sell the stock
into a secondary market, which makes it more difficult for a purchaser to
liquidate his/her investment. Any broker-dealer engaged by the purchaser for the
purpose of selling his or her shares in us will be subject to Rules 15g-1
through 15g-10 of the Securities and Exchange Act. Rather than creating a need
to comply with those rules, some broker-dealers will refuse to attempt to sell
penny stock.

The penny stock rules require a broker-dealer, prior to a transaction in a penny
stock not otherwise exempt from those rules, to deliver a standardized risk
disclosure document, which:

     -    contains a description of the nature and level of risk in the market
          for penny stock in both public offerings and secondary trading;

     -    contains a description of the broker's or dealer's duties to the
          customer and of the rights and remedies available to the customer with
          respect to a violation of such duties or other requirements of the
          Securities Act of 1934, as amended;

     -    contains a brief, clear, narrative description of a dealer market,
          including "bid" and "ask" price for the penny stock and the
          significance of the spread between the bid and ask price;

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     -    contains a toll-free telephone number for inquiries on disciplinary
          actions;

     -    defines significant terms in the disclosure document or in the conduct
          of trading penny stocks; and

     -    contains such other information and is in such form (including
          language, type, size and format) as the Securities and Exchange
          Commission shall require by rule or regulation;

The broker-dealer also must provide, prior to effecting any transaction in a
penny stock, to the customer:

     -    the bid and offer quotations for the penny stock;

     -    the compensation of the broker-dealer and its salesperson in the
          transaction;

     -    the number of shares to which such bid and ask prices apply, or other
          comparable information relating to the depth and liquidity of the
          market for such stock; and

     -    monthly account statements showing the market value of each penny
          stock held in the customer's account.

In addition, the penny stock rules require that prior to a transaction in a
penny stock not otherwise exempt from those 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 acknowledgment of the receipt
of a risk disclosure statement, a written agreement to transactions involving
penny stocks, and a signed and dated copy of a written suitability statement.
These disclosure requirements will have the effect of reducing the trading
activity in the secondary market for our stock because it will be subject to
these penny stock rules. Therefore, stockholders may have difficulty selling
their securities.

SHARES AVAILABLE UNDER RULE 144

There are currently 3,750,000 shares of common stock that are considered
restricted securities under Rule 144 of the Securities Act of 1933. All
3,750,000 shares are held by our officer and director. Under Rule 144, such
shares can be publicly sold, subject to volume restrictions and certain
restrictions on the manner of sale, commencing six months after their
acquisition.

HOLDERS

As of December 31, 2008, we have 9,250,000 Shares of $0.001 par value common
stock issued and outstanding held by 39 shareholders of record.

Island Stock Transfer is our transfer agent.

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DIVIDENDS

We have never declared or paid any cash dividends on our common stock. For the
foreseeable future, we intend to retain any earnings to finance the development
and expansion of our business, and we do not anticipate paying any cash
dividends on our common stock. Any future determination to pay dividends will be
at the discretion of the Board of Directors and will be dependent upon then
existing conditions, including our financial condition and results of
operations, capital requirements, contractual restrictions, business prospects,
and other factors that the board of directors considers relevant.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

RESULTS OF OPERATIONS

The Company's financial resources have been substantially reduced. We have
determined we need to raise additional monies through sales of our equity
securities or through loans from banks or third parties to continue our business
plans. No assurances can be given that we will be able to raise additional funds
to satisfy our financial requirements. It is possible we cannot continue with
our business operations as detailed in our original business plan because of a
lack of financial resources. We may look for other potential business
opportunities that might be available to the Company. There can be no
certainties that there will be any other business opportunities available; nor
the nature of the business opportunity; nor any indication of the financial
resources required of any possible business opportunity.

We have generated no revenues since inception and have incurred $41,417 in
expenses through December 31, 2008.

The following table provides selected financial data about our company for the
years ended December 31, 2008 and 2007.

            Balance Sheet Data:           12/31/08          12/31/07
            -------------------           --------          --------

            Cash                          $ 4,073           $27,948
            Total assets                  $ 4,073           $27,948
            Total liabilities             $ 8,490           $ 2,090
            Shareholders' equity          $(4,417)          $25,858

There was $37,000 cash provided by financing activities from inception through
the year ended December 31, 2008, this consisted of $15,000 from the sale of
shares to our director, $22,000 resulting from the sale of our common stock to
38 independent investors.

CAPITAL RESOURCES AND LIQUIDITY

Our cash balance at December 31, 2008 was $4,073. Our current liabilities are
$8,490 which includes $2,900 in accounts payable and $5,590 in a loan payable to
our director. Our general and administrative expenses are expected to average
less than $800 per month for the next 12 months.

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PLAN OF OPERATION

Statements contained herein which are not historical facts are forward-looking
statements as that term is defined by the Private Securities Litigation Reform
Act of 1995. Although the Company believes that the expectations reflected in
such forward-looking statements are reasonable, forward-looking statements are
subject to risks and uncertainties that could cause actual results to differ
from those projected. The Company cautions investors that any forward-looking
statements made by the Company are not guarantees of future performance and
actual results may differ materially from those in the forward-looking
statements. Such risks and uncertainties include, without limitation:
established competitors who have substantially greater financial resources and
operating histories, regulatory delays or denials, ability to compete as a
start-up company in a highly competitive market, and access to sources of
capital.

We anticipate that our operational, and general & administrative expenses for
the next 12 months will total approximately $9,000. We do not anticipate the
purchase or sale of any significant equipment. We also do not expect any
significant changes in the number of employees; we plan to add two contract
staff personnel. At this time we have not entered into any agreements or
negotiations with a sales and marketing entity to undertake marketing for us.
The foregoing represents our best estimate of our cash needs based on current
planning and business conditions. The exact allocation, purposes and timing of
any expenditure may vary significantly depending upon our progress with the
execution of our business plan.

In the event we are not successful in reaching our initial revenue targets,
additional funds may be required, and we may not be able to proceed with our
business plan for the development and marketing of our core services. Should
this occur, we would likely seek additional financing to support the continued
operation of our business. We anticipate that depending on market conditions and
our plan of operations, we would incur operating losses in the foreseeable
future. We base this expectation, in part, on the fact that we may not be able
to generate enough gross profit from the sale of our travel products and
services to cover our operating expenses.

OFF-BALANCE SHEET ARRANGEMENTS

We do not have any 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 investors.

CRITICAL ACCOUNTING POLICY AND ESTIMATES

Our Management's Discussion and Analysis of Financial Condition and Results of
Operations section discusses our financial statements, which have been prepared
in accordance with accounting principles generally accepted in the United States
of America. The preparation of the financial statements requires management 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
revenues and expenses during the reporting period. Actual results may differ
from these estimates.

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CASH AND CASH EQUIVALENTS

The Company considers all highly liquid debt instruments purchased with maturity
of three months or less to be cash equivalents.

REVENUE RECOGNITION

The Company considers revenue to be recognized at the time the service is
performed.

ADVERTISING

The company expenses advertising costs when incurred. No advertising costs were
incurred during the year ended December 31, 2008.

USE OF ESTIMATES

The preparation of the Company's financial statements requires management to
make estimates and assumptions that affect the amounts reported in the financial
statements and accompanying notes. Actual results could differ from these
estimates.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company's short-term financial instruments consist of cash and cash
equivalents and accounts payable. The carrying amounts of these financial
instruments approximate fair value because of their short-term maturities.
 Financial instruments that potentially subject the Company to a concentration
of credit risk consist principally of cash. During the year the Company did not
maintain cash deposits at financial institution in excess of the $100,000 limit
covered by the Federal Deposit Insurance Corporation. The Company does not hold
or issue financial instruments for trading purposes nor does it hold or issue
interest rate or leveraged derivative financial instruments.

EARNINGS PER SHARE

Basic Earnings per Share ("EPS") is computed by dividing net income available to
common stockholders by the weighted average number of common stock shares
outstanding during the year. Diluted EPS is computed by dividing net income
available to common stockholders by the weighted-average number of common stock
shares outstanding during the year plus potential dilutive instruments such as
stock options and warrant. The effect of stock options on diluted EPS is
determined through the application of the treasury stock method, whereby
proceeds received by the Company based on assumed exercises are hypothetically
used to repurchase the Company's common stock at the average market price during
the period. Loss per share is unchanged on a diluted basis since the assumed
exercise of common stock equivalents would have an anti-dilutive effect.

INCOME TAXES

The Company uses the asset and liability method of accounting for income taxes
as required by SFAS No. 109 "Accounting for Income Taxes". SFAS 109 requires the
recognition of deferred tax assets and liabilities for the expected future tax

                                       13
<PAGE>
consequences of temporary differences between the carrying amounts and the tax
basis of certain assets and liabilities. Deferred income tax assets and
liabilities are computed annually for the difference between the financial
statement and tax bases of assets and liabilities that will result in taxable or
deductible amounts in the future, based on enacted tax laws and rates applicable
to the periods in which the differences are expected to affect taxable income.
Valuation allowances are established when necessary to reduce deferred tax
assets to the amount expected to be realized. Income tax expense is the tax
payable or refundable for the period, plus or minus the change during the period
in deferred tax assets and liabilities.

Deferred income taxes may arise from temporary differences resulting from income
and expense items reported for financial accounting and tax purposes in
different periods. Deferred taxes are classified as current or non-current,
depending on the classification of the assets and liabilities to which they
relate. Deferred taxes arising from temporary differences that are not related
to an asset or liability are classified as current or non-current depending on
the periods in which the temporary differences are expected to reverse. The
Company had no significant deferred tax items arise during any of the periods
presented.

CONCENTRATION OF CREDIT RISK

The Company does not have any concentration of related financial credit risk.

RECENT ACCOUNTING PRONOUNCEMENTS

The Company does not expect that the adoption of other recent accounting
pronouncements will have a material impact to its financial statements.

                                       14
<PAGE>
ITEM 8. FINANCIAL STATEMENTS


MOORE & ASSOCIATES, CHARTERED
 ACCOUNTANTS AND ADVISORS
    PCAOB REGISTERED


             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors
Descanso Agency Inc
(A Development Stage Company)

We have  audited  the  accompanying  balance  sheets of  Descanso  Agency Inc (A
Development  Stage  Company) as of December  31, 2008 and 2007,  and the related
statements of operations, stockholders' equity and cash flows for the year ended
December  31,  2008 and for the period  since  inception  April 3, 2007  through
December  31, 2007 and since  inception  on April 3, 2007  through  December 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 conduct  our  audits in  accordance  with  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  Descanso  Agency  Inc (A
Development  Stage  Company) as of December  31, 2008 and 2007,  and the related
statements of operations, stockholders' equity and cash flows for the year ended
December  31,  2008 and for the period  since  inception  April 3, 2007  through
December  31, 2007 and since  inception  on April 3, 2007  through  December 31,
2008, in conformity with accounting  principles generally accepted in the United
States of America.

The  accompanying  financial  statements  have been  prepared  assuming that the
Company  will  continue  as a  going  concern.  As  discussed  in  Note 5 to the
financial statements,  the Company has an accumulated deficit of $41,417,  which
raises  substantial  doubt about its  ability to  continue  as a going  concern.
Management's  plans  concerning  these matters are also described in Note 5. The
financial  statements do not include any adjustments  that might result from the
outcome of this uncertainty.


/s/ Moore & Associates, Chartered
-----------------------------------------
Moore & Associates, Chartered
Las Vegas, Nevada
February 27, 2009


 6490 West Desert Inn Rd, Las Vegas, NV 89146 (702) 253-7499 Fax (702) 253-7501

                                       15
<PAGE>
                             DESCANSO AGENCY, INC.
                         (A Development Stage Company)
                                 Balance Sheets

<TABLE>
<CAPTION>
                                                                    Audited            Audited
                                                                  December 31,       December 31,
                                                                     2008               2007
                                                                   --------           --------
<S>                                                                <C>                <C>
ASSETS

CURRENT ASSETS
  Cash                                                             $  4,073           $ 27,948
                                                                   --------           --------
Total Current Assets                                                  4,073             27,948

      TOTAL ASSETS                                                 $  4,073           $ 27,948
                                                                   ========           ========

LIABILITIES & STOCKHOLDERS' EQUITY

LIABILITIES
  Accounts Payable                                                 $  2,900           $     --
  Loan Payable (From Director)                                        5,590              2,090
                                                                   --------           --------

TOTAL CURRENT LIABILITIES                                             8,490              2,090
                                                                   ========           ========

STOCKHOLDERS' EQUITY
  50,000,000 shares Common Stock
   Authorized at $0.001/par value 9,250,000 shares issued
   and outstanding @ June 30, 2008                                    9,250              9,250
  Additional Paid-in Capital                                         27,750             27,750
  Deficit accumulated during development stage                      (41,417)           (11,142)

                                                                   --------           --------
TOTAL STOCKHOLDERS' EQUITY                                           (4,417)            25,858
                                                                   --------           --------

      TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                   $  4,073           $ 27,948
                                                                   ========           ========
</TABLE>


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

                                       16
<PAGE>
                             DESCANSO AGENCY, INC.
                         (A Development Stage Company)
                            Statements of Operations

<TABLE>
<CAPTION>
                                                               For the Period
                                                               April 3, 2007        April 3, 2007
                                                                (Inception)          (Inception)
                                           Year Ending            Through              Through
                                           December 31,         December 31,         December 31,
                                              2008                 2007                 2008
                                           ----------           ----------           ----------
<S>                                        <C>                  <C>                  <C>
REVENUES
  Revenues                                 $       --           $       --           $       --
                                           ----------           ----------           ----------
TOTAL REVENUES                                     --                   --                   --

OPERATING EXPENSE
  Administrative Expense                       17,475                3,942               21,417
  Professional Services                        12,800                7,200               20,000
                                           ----------           ----------           ----------

LOSS BEFORE INCOME TAX EXPENSE                (30,275)             (11,142)             (41,417)
                                           ==========           ==========           ==========

Income tax expense                                 --                   --                   --
                                           ----------           ----------           ----------

NET LOSS                                   $  (30,275)          $  (11,142)          $  (41,417)
                                           ==========           ==========           ==========

Basic earnings per share                   $    (0.01)          $    (0.01)
                                           ==========           ==========

Weighted average number of common
 shares outstanding                         9,250,000            6,177,419
</TABLE>


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

                                       17
<PAGE>
                             DESCANSO AGENCY, INC.
                         (A Development Stage Company)
                  Statements of Changes in Stockholders' Equity

<TABLE>
<CAPTION>
                                                            Common      Additional    Deficit Accum
                                             Common         Stock         Paid-in        During
                                             Stock          Amount        Capital       Dev Stage       Total
                                             -----          ------        -------       ---------       -----
<S>                                        <C>             <C>           <C>           <C>            <C>
Stock issued for cash June 29, 2007
 at par value of $0.001 per share          4,750,000       $ 4,750       $ 14,250      $      --      $ 19,000

Stock issued for cash November 2, 2007
 at par value of 0.001 per share           4,500,000         4,500         13,500                       18,000

Net (loss) for the year 2007                                                             (11,142)      (11,142)
                                          ----------       -------       --------      ---------      --------

BALANCE DECEMBER 31, 2007                  9,250,000         9,250         27,750        (11,142)       25,858
                                          ==========       =======       ========      =========      ========

Net (loss) for the year 2008                                                             (30,275)      (30,275)
                                          ----------       -------       --------      ---------      --------

BALANCE DECEMBER 31, 2008                  9,250,000       $ 9,250       $ 27,750      $ (41,417)     $ (4,417)
                                          ==========       =======       ========      =========      ========
</TABLE>


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

                                       18
<PAGE>
                             DESCANSO AGENCY, INC.
                         (A Development Stage Company)
                            Statements of Cash Flows

<TABLE>
<CAPTION>
                                                                                  For the Period
                                                                                  April 3, 2007      April 3, 2007
                                                                                   (Inception)        (Inception)
                                                                Year Ending          Through            Through
                                                                December 31,       December 31,       December 31,
                                                                   2008               2007               2008
                                                                 --------           --------           --------
<S>                                                              <C>                <C>                <C>
CASH FLOW FROM OPERATING ACTIVITIES
  Net income (loss)                                              $(30,275)          $(11,142)          $(41,417)
  Accounts Payable                                                  2,900                 --              2,900
                                                                 --------           --------           --------
      Total cash provided by (used in) operating activities       (27,375)           (11,142)           (38,517)
                                                                 ========           ========           ========

CASH FLOW FROM INVESTING ACTIVITIES

      Net cash provided by (used in) investing activities              --                 --                 --
                                                                 --------           --------           --------
      Total cash provided by (used in) investing activities            --                 --                 --
                                                                 ========           ========           ========

CASH FLOW FROM FINANCING ACTIVITIES
  Loan from director                                                3,500              2,090              5,590
  Issuance of Common Stock                                             --             37,000             37,000
                                                                 --------           --------           --------
      Total cash provided by (used in financing activities)         3,500             39,090             42,590
                                                                 ========           ========           ========

Net increase (decrease) in cash                                   (23,875)            27,948              4,073

Cash at beginning of period                                        27,948                 --                 --

Cash at end of period                                            $  4,073           $ 27,948           $  4,073
                                                                 ========           ========           ========

SUPPLEMENTAL CASH FLOW DISCLOSURES:
  Cash paid during period for interest                           $     --           $     --           $     --
                                                                 ========           ========           ========
  Cash paid during period for taxes                              $     --           $     --           $     --
                                                                 ========           ========           ========
</TABLE>


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

                                       19
<PAGE>
                              DESCANSO AGENCY, INC.
                          (A Development Stage Company)
                          Notes to Financial Statements
                             As at December 31, 2008


NOTE 1 - NATURE AND PURPOSE OF BUSINESS

Descanso  Agency,  Inc. (the "Company") was  incorporated  under the laws of the
State of Nevada on April 3, 2007. The Company is "a  development  stage company"
that  intends to open  travel  agencies  specializing  in Mexican  tourism.  Its
activities  to date have been  limited to capital  formation,  organization  and
development of its business plan and limited operations.

NOTE 2 - NATURE OF SIGNIFICANT ACCOUNTING POLICIES

CASH AND CASH EQUIVALENTS

The Company considers all highly liquid debt instruments purchased with maturity
of three months or less to be cash equivalents.

REVENUE RECOGNITION

The  Company  considers  revenue  to be  recognized  at the time the  service is
performed.

ADVERTISING

The company expenses advertising costs when incurred.  No advertising costs were
incurred during the year ended December 31, 2008.

USE OF ESTIMATES

The preparation of the Company's  financial  statements  requires  management to
make estimates and assumptions that affect the amounts reported in the financial
statements  and  accompanying  notes.  Actual  results  could  differ from these
estimates.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The  Company's  short-term  financial  instruments  consist  of  cash  and  cash
equivalents  and  accounts  payable.  The  carrying  amounts of these  financial
instruments  approximate  fair  value  because of their  short-term  maturities.
Financial instruments that potentially subject

                                       20
<PAGE>
                              DESCANSO AGENCY, INC.
                          (A Development Stage Company)
                          Notes to Financial Statements
                             As at December 31, 2008


NOTE 2 - NATURE OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

the Company to a  concentration  of credit  risk  consist  principally  of cash.
During the period the  Company  did not  maintain  cash  deposits  at  financial
institution  in excess of the  $250,000  limit  covered by the  Federal  Deposit
Insurance Corporation.  The Company does not hold or issue financial instruments
for  trading  purposes  nor does it hold or  issue  interest  rate or  leveraged
derivative financial instruments.

EARNINGS PER SHARE

Basic Earnings per Share ("EPS") is computed by dividing net income available to
common  stockholders  by the  weighted  average  number of common  stock  shares
outstanding  during the year.  Diluted EPS is  computed  by dividing  net income
available to common stockholders by the weighted-average  number of common stock
shares outstanding  during the year plus potential dilutive  instruments such as
stock  options  and  warrant.  The effect of stock  options  on  diluted  EPS is
determined  through  the  application  of the  treasury  stock  method,  whereby
proceeds received by the Company based on assumed  exercises are  hypothetically
used to repurchase the Company's common stock at the average market price during
the period.  Loss per share is  unchanged  on a diluted  basis since the assumed
exercise of common stock equivalents would have an anti-dilutive effect.

INCOME TAXES

The Company uses the asset and liability  method of accounting  for income taxes
as required by SFAS No. 109 "Accounting for Income Taxes". SFAS 109 requires the
recognition of deferred tax assets and  liabilities  for the expected future tax
consequences of temporary  differences  between the carrying amounts and the tax
basis of  certain  assets  and  liabilities.  Deferred  income  tax  assets  and
liabilities  are computed  annually  for the  difference  between the  financial
statement and tax bases of assets and liabilities that will result in taxable or
deductible amounts in the future, based on enacted tax laws and rates applicable
to the periods in which the  differences  are expected to affect taxable income.
Valuation  allowances  are  established  when  necessary to reduce  deferred tax

                                       21
<PAGE>
                              DESCANSO AGENCY, INC.
                          (A Development Stage Company)
                          Notes to Financial Statements
                             As at December 31, 2008


NOTE 2 - NATURE OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

assets to the amount  expected  to be  realized.  Income tax  expense is the tax
payable or refundable for the period, plus or minus the change during the period
in deferred tax assets and liabilities.

Deferred income taxes may arise from temporary differences resulting from income
and  expense  items  reported  for  financial  accounting  and tax  purposes  in
different  periods.  Deferred  taxes are  classified as current or  non-current,
depending  on the  classification  of the assets and  liabilities  to which they
relate. Deferred taxes arising from temporary

differences  that are not related to an asset or  liability  are  classified  as
current  or  non-current  depending  on  the  periods  in  which  the  temporary
differences are expected to reverse. The Company had no significant deferred tax
items arise during any of the periods presented.

CONCENTRATION OF CREDIT RISK

The Company does not have any concentration of related financial credit risk.

RECENT ACCOUNTING PRONOUNCEMENTS

In May 2008, the Financial  Accounting  Standards Board ("FASB") issued SFAS No.
163, "Accounting for Financial Guarantee Insurance Contracts-and  interpretation
of FASB  Statement  No. 60".  SFAS No. 163 clarifies how Statement 60 applies to
financial   guarantee  insurance   contracts,   including  the  recognition  and
measurement  of premium  revenue and claims  liabilities.  This  statement  also
requires expanded  disclosures about financial  guarantee  insurance  contracts.
SFAS No. 163 is effective  for fiscal years  beginning on or after  December 15,
2008, and interim periods within those years.  SFAS No. 163 has no effect on the
Company's  financial position,  statements of operations,  or cash flows at this
time.

In May 2008, the Financial  Accounting  Standards Board ("FASB") issued SFAS No.
162, "The Hierarchy of Generally Accepted Accounting  Principles".  SFAS No. 162
sets  forth  the  level of  authority  to a given  accounting  pronouncement  or
document by  category.  Where there might be  conflicting  guidance  between two
categories,  the more  authoritative  category will  prevail.  SFAS No. 162 will

                                       22
<PAGE>
                              DESCANSO AGENCY, INC.
                          (A Development Stage Company)
                          Notes to Financial Statements
                             As at December 31, 2008


NOTE 2 - NATURE OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

become  effective 60 days after the SEC approves  the PCAOB's  amendments  to AU
Section 411 of the AICPA Professional  Standards.  SFAS No. 162 has no effect on
the Company's  financial  position,  statements of operations,  or cash flows at
this time.

In  March  2008,  the  Financial  Accounting  Standards  Board  ("FASB")  issued
Statement of Financial  Accounting Standards ("SFAS") No. 161, DISCLOSURES ABOUT
DERIVATIVE  INSTRUMENTS AND HEDGING  ACTIVITIES,  AN AMENDMENT OF FASB STATEMENT
NO. 133 ("SFAS 161"). SFAS 161 expands the disclosure  requirements in Statement
133 about an entity's

derivative  instruments  and  hedging  activities.  SFAS  161 is  effective  for
financial statements issued for fiscal years and interim periods beginning after
November 15, 2008. We are currently evaluating the impact of adopting FAS 161.

In December  2007,  the FASB issued SFAS No. 160,  NONCONTROLLING  INTERESTS  IN
CONSOLIDATED FINANCIAL STATEMENTS, AN AMENDMENT OF ARB 51 ("SFAS 160"). SFAS 160
changes the accounting and reporting for minority interests.  Minority interests
will be  recharacterized  as noncontrolling  interests and will be reported as a
component of equity separate from the parent's equity, and purchases or sales of
equity interests that do not result in a change in control will be accounted for
as  equity   transactions.   In  addition,   net  income   attributable  to  the
noncontrolling  interest will be included in consolidated net income on the face
of the income  statement and upon a loss of control,  the interest sold, as well
as any interest  retained,  will be recorded at fair value with any gain or loss
recognized in earnings.  SFAS 160 is effective for financial  statements  issued
for fiscal years  beginning  after December 15, 2008, and interim periods within
those fiscal years,  except for the  presentation  and disclosure  requirements,
which will apply  retrospectively.  There will be no impact upon adoption to our
current consolidated results of operations and financial condition.

In  December  2007,  the FASB  issued  SFAS No.  141  (Revised  2007),  BUSINESS
COMBINATIONS  ("SFAS 141R").  SFAS 141R replaces SFAS No. 141. SFAS 141R retains
the purchase  method of accounting  for  acquisitions,  but requires a number of
changes,  including  changes in the way assets and liabilities are recognized in

                                       23
<PAGE>
                              DESCANSO AGENCY, INC.
                          (A Development Stage Company)
                          Notes to Financial Statements
                             As at December 31, 2008


NOTE 2 - NATURE OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

the  purchase  accounting.  SFAS 141R also  changes  the  recognition  of assets
acquired  and  liabilities  assumed  arising  from  contingencies,  requires the
capitalization  of  in-process  research  and  development  at fair  value,  and
requires the expensing of  acquisition-related  costs as incurred.  SFAS 141R is
effective  for business  combinations  for which the  acquisition  date is on or
after the beginning of the first annual  reporting  period beginning on or after
December  15,  2008.  We  will  apply  SFAS  141R   prospectively   to  business
combinations  completed  on or after  that date.  There  will be no impact  upon
adoption  to our  current  consolidated  results  of  operations  and  financial
condition.

NOTE 3 - COMMON STOCK

Transactions,  other than  employees'  stock  issuance,  are in accordance  with
paragraph 8 of SFAS 123. Thus issuances shall be accounted for based on the fair
value of the consideration received. Transactions with employees' stock issuance
are in accordance with paragraphs  (16-44) of SFAS 123. These issuances shall be
accounted for based on the fair value of the consideration  received or the fair
value  of  the  equity   instruments   issued,  or  whichever  is  more  readily
determinable.

On June 28,  2007 the Company  issued  3,750,000  shares of common  stock to the
Company's sole officer and director,  for cash in the amount of $0.004 per share
for a total of $15,000.

On June 29, 2007 the Company sold 1,000,000 shares of its common stock at $0.004
per share to 2 independent investors for proceeds of $4,000.

On October 22, 2007 the  Company's  offering  pursuant to the SB-2  Registration
Statement  filed by the company on September 4, 2007, and declared  effective on
September 17, 2007, was completed  selling  4,500,000 shares to 36 un-affiliated
investors for total proceeds to the company of $18,000.

                                       24
<PAGE>
                              DESCANSO AGENCY, INC.
                          (A Development Stage Company)
                          Notes to Financial Statements
                             As at December 31, 2008


NOTE 4 - RELATED PARTY TRANSACTIONS

The sole officer and director of the Company may, in the future, become involved
in other business  opportunities  as they become  available,  thus he may face a
conflict in selecting between the Company and his other business  opportunities.
The Company has not formulated a policy for the resolution of such conflicts.

The director  was not paid for any  underwriting  services  that he performed on
behalf of the Company with respect to the Company's SB-2 offering.  He will also
not  receive  any  interest  on any funds that he may advance to the Company for
offering  expenses  prior to the offering being closed which will be repaid from
the proceeds of the offering.

While the company is seeking  additional  capital,  the  president  has advanced
funds to the company to pay for organizational  costs incurred.  These funds are
interest  free with no  specific  terms of  repayment.  The  balance  due to the
president on December 31, 2008 was $5,590.

NOTE 5 - GOING CONCERN

The accompanying  financial  statements have been prepared  assuming the Company
will  continue  as a going  concern.  As  shown  in the  accompanying  financial
statements,  the  Company  has no sales and has  incurred  a net loss of $41,417
since  inception.  The future of the  Company is  dependent  upon its ability to
obtain financing and upon future  profitable  operations form the development of
its travel  agencies.  The financial  statements do not include any  adjustments
relating to the  recoverability  and  classifications of recorded assets, or the
amounts of and  classification  of  liabilities  that might be  necessary in the
event the Company cannot continue in existence.

Management has raised funds through an equity offering pursuant to the Company's
SB-2 registration  statement with the U.S.  Securities and Exchange  Commission.
There is no guarantee  that the capital  raised will be  sufficient  or that any
future offerings, if necessary, would be successful.

                                       25
<PAGE>
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES

MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Our management is responsible for establishing and maintaining adequate internal
control over financial reporting. Internal control over financial reporting is
defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Securities Exchange
Act of 1934 as a process designed by, or under the supervision of, the company's
principal executive and principal financial officers and effected by the
company's board of directors, management and other personnel, to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
accounting principles generally accepted in the United States of America and
includes those policies and procedures that:

     -    Pertain to the maintenance of records that in reasonable detail
          accurately and fairly reflect the transactions and dispositions of the
          assets of the company;
     -    Provide reasonable assurance that transactions are recorded as
          necessary to permit preparation of financial statements in accordance
          with accounting principles generally accepted in the United States of
          America and that receipts and expenditures of the company are being
          made only in accordance with authorizations of management and
          directors of the company; and
     -    Provide reasonable assurance regarding prevention or timely detection
          of unauthorized acquisition, use or disposition of the company's
          assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting
may not prevent or detect misstatements. Projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate. All internal control systems,
no matter how well designed, have inherent limitations. Therefore, even those
systems determined to be effective can provide only reasonable assurance with
respect to financial statement preparation and presentation. Because of the
inherent limitations of internal control, there is a risk that material
misstatements may not be prevented or detected on a timely basis by internal
control over financial reporting. However, these inherent limitations are known
features of the financial reporting process. Therefore, it is possible to design
into the process safeguards to reduce, though not eliminate, this risk.

As of December 31, 2008 management assessed the effectiveness of our internal
control over financial reporting based on the criteria for effective internal
control over financial reporting established in Internal Control--Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway
Commission ("COSO") and SEC guidance on conducting such assessments. Based on
that evaluation, they concluded that, during the period covered by this report,
such internal controls and procedures were not effective to detect the
inappropriate application of US GAAP rules as more fully described below. This
was due to deficiencies that existed in the design or operation of our internal

                                       26
<PAGE>
controls over financial reporting that adversely affected our internal controls
and that may be considered to be material weaknesses.

The matters involving internal controls and procedures that our management
considered to be material weaknesses under the standards of the Public Company
Accounting Oversight Board were: (1) lack of a functioning audit committee due
to a lack of a majority of independent members and a lack of a majority of
outside directors on our board of directors, resulting in ineffective oversight
in the establishment and monitoring of required internal controls and
procedures; (2) inadequate segregation of duties consistent with control
objectives; and (3) ineffective controls over period end financial disclosure
and reporting processes. The aforementioned material weaknesses were identified
by our Chief Executive Officer in connection with the review of our financial
statements as of December 31, 2008.

Management believes that the material weaknesses set forth in items (2) and (3)
above did not have an effect on our financial results. However, management
believes that the lack of a functioning audit committee and the lack of a
majority of outside directors on our board of directors results in ineffective
oversight in the establishment and monitoring of required internal controls and
procedures, which could result in a material misstatement in our financial
statements in future periods.

This annual report does not include an attestation report of the Corporation's
registered public accounting firm regarding internal control over financial
reporting. Management's report was not subject to attestation by the
Corporation's registered public accounting firm pursuant to temporary rules of
the SEC that permit the Corporation to provide only the management's report in
this annual report.

MANAGEMENT'S REMEDIATION INITIATIVES

In an effort to remediate the identified material weaknesses and other
deficiencies and enhance our internal controls, we have initiated, or plan to
initiate, the following series of measures:

We will create a position to segregate duties consistent with control objectives
and will increase our personnel resources and technical accounting expertise
within the accounting function when funds are available to us. And, we plan to
appoint one or more outside directors to our board of directors who shall be
appointed to an audit committee resulting in a fully functioning audit committee
who will undertake the oversight in the establishment and monitoring of required
internal controls and procedures such as reviewing and approving estimates and
assumptions made by management when funds are available to us.

Management believes that the appointment of one or more outside directors, who
shall be appointed to a fully functioning audit committee, will remedy the lack
of a functioning audit committee and a lack of a majority of outside directors
on our Board.

We anticipate that these initiatives will be at least partially, if not fully,
implemented by December 31, 2009. Additionally, we plan to test our updated
controls and remediate our deficiencies by December 31, 2009.

                                       27
<PAGE>
CHANGES IN INTERNAL CONTROLS OVER FINANCIAL REPORTING

There was no change in our internal controls over financial reporting that
occurred during the period covered by this report, which has materially
affected, or is reasonably likely to materially affect, our internal controls
over financial reporting.

CEO AND CFO CERTIFICATIONS

Appearing immediately following the Signatures section of this report there are
Certifications of the CEO and the CFO. The Certifications are required in
accordance with Section 302 of the Sarbanes-Oxley Act of 2002 (the Section 302
Certifications). This Item of this report, which you are currently reading is
the information concerning the Evaluation referred to in the Section 302
Certifications and this information should be read in conjunction with the
Section 302 Certifications for a more complete understanding of the topics
presented.

                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS

Our directors are appointed for a one-year term to hold office until the next
annual general meeting of our shareholders or until removed from office in
accordance with our bylaws. Our officers are appointed by our board of directors
and hold office until removed by the board.

Our sole executive officer and director and his age as of the date of this
annual report is as follows:

   Name             Age                          Position
   ----             ---                          --------

Raul Getino         46       President, Chief Executive Officer, Chief Financial
                             Officer, Chairman of the Board of Directors

Set forth below is a brief
description of the background and business experience of our executive officer
and director.

RAUL GETINO. Raul Getino, our President, Chief Executive Officer, Chief
Financial Officer and Chairman of the Board of Directors.

BUSINESS BACKGROUND

Paradise Weddings and Hotels, Baja California 1989-2007
Travel & Special Event Coordinator
Responsible for wedding and special travel event promotions for resorts in Baja
California. In charge of managing senior staff personnel and all marketing and
advertising.

Costa Azul Travel 1988-1989
Travel Agent
Responsible for marketing and promotions to United State travel agencies.

                                       28
<PAGE>
EDUCATION

Middle Education (Preparatoria): Colegio De Barchilleres, Tijuana, Mexico,
Graduated 1988.

INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS

To the best of our knowledge, during the past five years, none of the following
occurred with respect to a present or former director or executive officer of
the Company: (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 any competent jurisdiction, permanently or temporarily
enjoining, barring, suspending or otherwise limiting his involvement in any type
of business, securities or banking activities; and (4) being found by a court of
competent jurisdiction (in a civil action), the Securities and Exchange
Commission or the commodities futures trading commission to have violated a
Federal or state securities or commodities law, and the judgment has not been
reversed, suspended or vacated.

CODE OF ETHICS

We do not currently have a code of ethics. Because we have only limited business
operations and one officer and director, we believe a code of ethics would have
limited utility. We intend to adopt a code of ethics as our business operations
expand and we have additional directors, officers and employees.

ITEM 11. EXECUTIVE COMPENSATION

We began paying our officer a monthly salary of $300 for his services in April
2008. To date the amount has been accrued as an account payable due to our
limited funds. He is reimbursed for any out-of-pocket expenses he incurs on our
behalf. We do not currently have any benefits, such as health insurance, life
insurance or any other benefits available to our employee.

Our officer and director is not party to any employment agreements.

                           SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
                                                                                 Change in
                                                                                  Pension
                                                                                 Value and
                                                                   Non-Equity   Nonqualified
                                                                   Incentive     Deferred       All
 Name and                                                            Plan         Compen-      Other
 Principal                                   Stock       Option     Compen-       sation       Compen-
 Position       Year   Salary     Bonus      Awards      Awards     sation       Earnings      sation     Totals
------------    ----   ------     -----      ------      ------     ------       --------      ------     ------
<S>             <C>       <C>       <C>          <C>        <C>        <C>           <C>         <C>        <C>
Raul Getino,    2007     0         0           0            0          0            0             0         0
President,      2008     0         0           0            0          0            0             0         0
CEO and
Director
</TABLE>

                                       29
<PAGE>
                  OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END

<TABLE>
<CAPTION>
                                      Option Awards                                             Stock Awards
          -----------------------------------------------------------------   ----------------------------------------------
                                                                                                                    Equity
                                                                                                                   Incentive
                                                                                                       Equity        Plan
                                                                                                      Incentive     Awards:
                                                                                                        Plan       Market or
                                                                                                       Awards:      Payout
                                          Equity                                                      Number of    Value of
                                         Incentive                            Number                  Unearned     Unearned
                                        Plan Awards;                            of         Market      Shares,      Shares,
           Number of      Number of      Number of                            Shares      Value of    Units or     Units or
          Securities     Securities     Securities                           or Units    Shares or     Other         Other
          Underlying     Underlying     Underlying                           of Stock     Units of     Rights       Rights
          Unexercised    Unexercised    Unexercised   Option      Option       That      Stock That     That         That
          Options (#)    Options (#)     Unearned     Exercise  Expiration   Have Not     Have Not    Have Not     Have Not
Name      Exercisable   Unexercisable   Options (#)    Price       Date      Vested(#)     Vested      Vested       Vested
----      -----------   -------------   -----------    -----       ----      ---------     ------      ------       ------
<S>            <C>            <C>            <C>         <C>         <C>         <C>          <C>         <C>         <C>
Raul           0              0              0           0           0           0            0           0            0
Getino
</TABLE>

                              DIRECTOR COMPENSATION

<TABLE>
<CAPTION>
                                                                     Change in
                                                                      Pension
                                                                     Value and
                   Fees                            Non-Equity       Nonqualified
                  Earned                            Incentive        Deferred
                 Paid in      Stock     Option        Plan         Compensation     All Other
    Name           Cash      Awards     Awards     Compensation      Earnings      Compensation     Total
    ----           ----      ------     ------     ------------      --------      ------------     -----
<S>             <C>       <C>        <C>           <C>             <C>            <C>              <C>
Raul Getino          0         0           0            0                0               0            0
</TABLE>

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table provides the names and addresses of each person known to us
to own more than 5% of our outstanding shares of common stock as of December 31,
2008 and by the officer and director, individually and as a group. Except as
otherwise indicated, all shares are owned directly.

<TABLE>
<CAPTION>
                           Name and Address                  Amount and Nature         Percent
Title of Class           of Beneficial Owner                of Beneficial Owner       of Class (1)
--------------           -------------------                -------------------       ------------
<S>                  <C>                                     <C>                      <C>
Common Stock         Raul Getino                                 3,750,000                40%
                     4203 Genesee Ave, Suite 103 #510
                     San Diego, CA  92117
                                                                 3,750,000                40%
Common Stock         All executive officers
                      and directors as a group
</TABLE>

----------
(1)  The percent of class is based on 9,250,000 shares of our common stock
     issued and outstanding as of December 31, 2008.

                                       30
<PAGE>
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The principal executive office and telephone number are provided by Mr. Getino,
the officer of the corporation at no charge until we occupy the property for our
first travel agency.

Mr. Getino purchased 3,750,000 shares of the company's common stock for cash in
the amount of $15,000. The stock was valued at $0.004 per share.

As of December 31, 2008 our director had loaned the company $5,590 for
organizational costs and operating expenses. The loan is non-interest bearing
and has no specific terms of repayment.

We do not currently have any conflicts of interest by or among our current
officers, director, key employees or advisors. We have not yet formulated a
policy for handling conflicts of interest; however, we intend to do so prior to
hiring any additional employees.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

For the year ended December 31, 2008, the total fees charged to the company for
audit services, including quarterly reviews were $7,500, for audit-related
services were $Nil, for tax services were $Nil and for other services were $Nil.

For the year ended December 31, 2007, the total fees charged to the company for
audit services, including quarterly reviews were $4,000, for audit-related
services were $Nil, for tax services were $Nil and for other services were $Nil.

                                       31
<PAGE>
                                     PART IV

ITEM 15. EXHIBITS

The following exhibits are included with this filing:

     Exhibit
     Number                     Description
     ------                     -----------

        3(i)           Articles of Incorporation*
        3(ii)          Bylaws*
       31.1            Sec. 302 Certification of CEO
       31.2            Sec. 302 Certification of CFO
       32.1            Sec. 906 Certification of CEO and CFO

----------
*    Included in our original SB-2 filed with the Securities & Exchange
     Commission on September 4, 2007 under File Number 333-145876.

                                   SIGNATURES

In accordance with the requirements of the Securities Act of 1934, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form 10-K and authorized this annual report to
be signed on its behalf by the undersigned, in the City of San Diego, State of
California on March 2, 2009.


By: /s/ Raul Getino
   ---------------------------------------------------------------
   RAUL GETINO
   President, Sole Director and Chairman of the Board of Directors


By: /s/ Raul Getino
   ---------------------------------------------------------------
   RAUL GETINO
   Chief Executive Officer, Chief Financial Officer and Principal
   Accounting Officer

                                       32