UNITED STATES
 SECURITIES AND EXCHANGE COMMISION
 WASHINGTON, D.C. 20549
 FORM 10-QSB/A
 
 (Mark One)
 [ X ]  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
 SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended December 31, 2002
 
 [ ]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
 SECURITIES EXCHANGE ACT
 For the transition period from  to  .
 
 Commission file number 1-14072
 
 THE AMANDA COMPANY,INC.
 (Exact name of small business issuer as specified in its charter)
 
 UTAH
87-0430260(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No) 
 13765
 ALTON PARKWAY, SUITE F, IRVINE, CA
92618(Address of Principal Executive Offices)
(Zip Code)
 
 (949) 859-6279
 (Issuer's telephone number)
 
 N/A
 
 (Former name, former address and former fiscal year, if changed since last report)
 
 Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
 
 Yes X No  .
 
 
 APPLICABLE ONLY TO CORPORATE ISSUERS
 
 As of December 31, 2002 the issuer had 121,993,231 shares of its common stock, par value $0.01 per share, issued and outstanding.
 Transitional Small Business Disclosure Format (check one):
 
 Yes  No X .
 **** 
 FORM 10-QSB
 
 THE AMANDA COMPANY, INC.
 
 Table of Contents
 
 
 PART I
FINANCIAL INFORMATIONItem 1
Financial StatementsFinancial Information
2Balance Sheets at December 31, 2002(unaudited) and September 30, 2002
3Statements of Operations for the three monthsended December 31, 2002 and 2001 (unaudited)
5Statements of Cash Flows for the three monthsended December 31, 2002 and 2001 (unaudited)
6Notes to Condensed Financial Statements (unaudited)
7Item 2
Management's Discussion and Analysis or Plan of Operation
9Item 3.
Control and Procedures
10PART II
OTHER INFORMATIONItem 1
Legal Proceedings
11Item 2
Changes in the Securities and Use of Proceeds
11Item 3
Defaults Upon Senior Securities
11Item 4
Submission of Matters to a Vote of Security Holders
11Item 5
Other Information
11Item 6(a)
Exhibits and Reports on Form 8-K
11Signatures

12Certifications

12Exhibit Index

15
 
  **1** THE AMANDA COMPANY, INC.
 
 PART I
 
 FINANCIAL INFORMATION
 
 ITEM 1. INTERIM CONDENSED FINANCIAL STATEMENTS
 The Amanda Company, Inc. (the "Company"), has included the unaudited condensed balance sheet of the Company as of December 31, 2002 and audited balance sheet as of September 30, 2002 (the Company's most recent fiscal year), unaudited condensed statements of operations for the three months ended December 31, 2002 and 2001, and unaudited condensed statements of cash flows for the three months ended December 31, 2002 and 2001, together with unaudited condensed notes thereto. In the opinion of management of the Company, the financial statements reflect all adjustments, all of which are normal recurring adjustments, considered necessary to fairly present the financial condition, results of operations and cash flows of the Company for the interim periods presented. The financial statements included in this report on Form 10-QSB should be read in conjunction with the audited financial statements of the Company and the notes thereto included in the annual report of the Company on Form 10-KSB for the year ended September 30, 2002. The results of operations for the three months ended December 31, 2002 may not be indicative of the results that may be expected for the year ending September 30, 2003.
 
 **2** 
 THE AMANDA COMPANY, INC.BALANCE SHEETSASSETSDecember 31,
September 302002
2002(unaudited)
(audited)CURRENT ASSETSCash and cash equivalents
$
8,493
$
57,413Accounts receivable, net

59,754

84,395Other receivable

11,295

10,795Inventory

15,631

56,469Prepaid and other current assets

68,882

75,549Total current assets

164,055

284,621PROPERTY AND EQUIPMENT, NET

69,157

82,282NON-CURRENT ASSETSDeferred Debt Issuance Costs

253,171

286,982Other assets

29,974

29,974Total assets
$
516,357
$
683,859











The accompanying notes are an integral part of these statements.
**3**
THE AMANDA COMPANY, INC.BALANCE SHEETS - CONTINUEDLIABILITIES AND STOCKHOLDERS' DEFICITDecember 31,
September 302002
2002(unaudited)
(audited)CURRENT LIABILITIESAccounts payable
$
494,419

$
576,109Liabilities from discontinued operations

444,841


444,841Accrued liabilities

451,181


400,846Leasing financing payable

27,755


36,440Notes payable

476,023


429,500Deferred revenue

24,552


17,001Convertible debentures

923,570


895,952Accrued dividends payable

655,420


629,126Total current liabilities

3,497,761


3,429,815LONG-TERM LIABILITIESConvertible debentures

442,899


442,899Deferred gain on sale leaseback

25,677


32,680Lease financing payable

55,537


55,537Total long-term liabilities

524,113


531,116Total liabilities

4,021,874


3,960,931STOCKHOLDERS' DEFICITConvertible Preferred stock, $0.01 par value authorized5,000,000 sharesSeries A; issued and outstanding 21 shares atDecember 31, 2002 and September 30, 2002

1


1Series B: issued and outstanding 631 shares atDecember 31, 2002 and September 30, 2002

6


6Common stock, $.01 par value, 500,000,000 sharesauthorized; issued and outstanding 121,993,231 sharesat December 31, 2002 and 108,159,899 shares atSeptember 30, 2002.

1,219,933


1,081,599Additional paid-in capital

1,173,662


1,269,229Accumulated deficit

(5,899,119
)

(5,627,907
)Total stockholders' deficit

(3,505,517
)

(3,277,072
)Total liabilities and stockholders' deficit
$
516,357

$
683,859
The accompanying notes are an integral part of these statements.

**4**
THE AMANDA COMPANY, INC.STATEMENTS OF OPERATIONS(Unaudited)Three months endedDecember 31,2002
2001Net sales
$
412,024

$
900,377Cost of sales

176,491


438,694Gross profit

235,533


461,683Selling, general and administrative expenses

360,106


556,940Operating loss

(124,573
)

(95,257
)Other income (expense)Interest expense

(76,534
)

(37,860
)Miscellaneous income/(expense), net

(43,811
)

(4,764
)Loss before extraordinary item

(244,918
)

(137,881
)Merger costs

-


(876,000
)Net loss before income taxes

(244,918
)

(1,013,881
)Income taxes

-


-Net loss
$
(244,918
)
$
(1,013,881
)Preferred stock dividend

(26,294
)

(22,714
)Net loss attributable to common stockholders
$
(271,212
)
$
(1,036,595
)Basic loss per share
$
(0.002
)
$
(0.015
)Diluted loss per share
$
(0.002
)
$
(0.015
)Weighted-average shares outstanding - basic

112,004,619


69,220,818Weighted-average shares outstanding - diluted

112,004,619


69,220,818
The accompanying notes are an integral part of these statements.

**5**
THE AMANDA COMPANY, INC.STATEMENTS OF CASH FLOWFOR THE THREE MONTHS ENDED DECEMBER 31, 2002 and 20012002
2001CASH FLOWS FROM OPERATING ACTIVITIES:Net loss

$
(271,212
)
$
(1,013,881
)Adjustments to reconcile net cash provided (used) inoperating activitiesDepreciation and amortization


13,125


8,412Amortization of beneficial conversion feature


27,618


-Common stock issued for services


10,000


-Common stock issued for compensation


32,767


1,081,729Effect on cash of changes in operating assets and liabilities:Decrease (increase) in accounts receivable, net


24,641


(69,538
)Decrease (increase) in other receivables


(500
)

(10,000
)Decrease (increase) in inventory


40,838


4,221Decrease (increase) in prepaid and other current assets


6,667


(72,164
)Decrease (increase) in security deposits


-


(7,038
)Increase (decrease) in accounts payable


(81,690
)

(300,442
)Increase (decrease) in accrued expenses


76,629


(9,424
)Increase (decease) in advances payable


-


(40,000
)Increase (decease) in unearned gain on sale leaseback


(7,003
)

-Increase (decrease) in deferred revenue


7,551


11,713Net cash provided (used) in operating activities


(120,569
)

(416,412
)CASH FLOWS FROM FINANCING ACTIVITIES:Deferred debt issuance costs


33,811


-Payments of notes payable


-


(110,000
)Payments of equipment financing


(8,685
)

(10,735
)Proceeds from equipment financing


-


-Proceeds from notes payable


46,523


-Proceeds from convertible debenture


-


100,000Proceeds from convertible promissory notes


-


470,000Net cash provided (used) in financing activities


71,649


449,265Net increase (decrease) in cash and cash equivalents


(48,920
)

32,853Cash and cash equivalents at beginning of period


57,413


36,394Cash and cash equivalents at end of period

$
8,493

$
69,247
The accompanying notes are an integral part of these statements.

**6**
 
 The accompanying notes are an integral part of these statements.
 
 NOTE A - GOING CONCERN
 
 The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company had a loss of $271,212 for the quarter ended December 31, 2002, a deficit of $3,505,517 in stockholders' equity and negative working capital of $3,333,706 for the period ended December 31, 2002. The Company intends to continue its strategies of cutting costs, applying more aggressive sales/marketing activities to boost revenues and continuing its efforts to raise additional funds in the capital markets to improve its working capital position. The Company needs to be successful in these endeavors in order to continue as a going concern.
 
 NOTE B - OPTIONS TO PURCHASE COMMON STOCK
 
 No options were exercised in the first quarter.
 
 NOTE C - WARRANTS TO PURCHASE COMMON STOCK
 
 No warrants were exercised in the first quarter.
 
 NOTE D - OPTIONS/WARRANTS TO PURCHASE COMMON STOCK
 
 On October 10, 2002, the Company issued a total of 5,000,000 warrants. Each warrant allows the holder to purchase one share of common stock at an exercise price equal to $.006 per share. These warrants expire October 10, 2007.
 
 On November 6, 2002, the Company issued a total of 500,000 warrants. Each warrant allows the holder to purchase one share of common stock at an exercise price equal to $.005 per share. These warrants expire in blocks of 125,000 each on November 6, 2007, February 6, 2008, May 6, 2008, and August 6, 2008, respectively.
 
 On November 15, 2002, the Company issued a total of 2,500,000 warrants. Each warrant allows the holder to purchase one share of common stock at an exercise price equal to $.006 per share. These warrants expire November 15, 2007.
 
 NOTE E - ACCRUED PREFERRED STOCK DIVIDENDS
 
 The Company accrued $26,294 for dividends payable to preferred shareholders during the quarter.
 
 NOTE F - PREFERRED STOCK
 
 The Company has issued two series of Preferred Stock. Series A was issued in February 1999 consisting of 1,800 shares, par value $0.01 per share, for $1,000 per share. Series B was issued in April 1999 at the same price and par value but only 1,000 shares were issued. Both series of Preferred Stock carry a 16 percent dividend rate, which is paid quarterly. If and when the Company's stock is listed again on NASDAQ the dividend rate will drop to 8 percent.
 
 **7**
  Both issuances of Preferred Stock are convertible into shares of the Company's Common Stock. Each share of Series A Preferred Stock is convertible into an amount of shares of Amanda Common Stock equal to $1,000 divided by the average of the two lowest closing bid prices for Pen Common Stock during the period of 22 consecutive trading days ending with the last trading day before the date of conversion, after discounting that market price by 15 percent (the "Conversion Price"). The maximum Conversion Price for the Series A Preferred Stock is $1.17 per share. The shares of Series B Preferred Stock are convertible into Common Stock at the same Conversion Price as the Series A Preferred Stock except for a maximum Conversion Price of $0.79 per share. Warrants to acquire 320,000 shares of Common Stock at prices ranging from $0.86 to $1.28 per share were also issued to the purchasers of the Series A and Series B Preferred Stock. The Warrants expire three years from date the Preferred Stock and warrants were initially issued.
 
 No warrants were converted in the first quarter.
 
 Note G - EARNINGS (LOSS) PER SHARE
 
 Basic earnings (loss) per common share is computed by dividing net earnings (loss) available to common shareholders by the weighted average number of common shares outstanding during each period. Diluted earnings (loss) per common share are similarly calculated, except that the weighted average number of common shares outstanding includes common shares that may be issued subject to existing rights with dilutive potential except for periods when such calculations would be anti-dilutive.
 
 For the three ended December 31, 2002, net earnings (loss) attributable to common shareholders includes accrued dividends at the stated dividend rate from date of issuance.
 
 NOTE H  INTERIM PERIOD COST OF GOODS SOLD
 
 Inventory costing is based on specific identification. An inventory count is taken at the end of each quarter.
 
 NOTE J  INCOME TAXES
 
 The future benefits of loss carried forward are fully reserved. There were no income taxes during the quarter.
 
 
 
 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
 
 
 FORWARD-LOOKING STATEMENTS. This report contains certain forward-looking statements within the meaning of section 27A of the Securities Act of 1933 as amended, and section 21E of the Securities Exchange Act of 1934, as amended, that involve risks and uncertainties. In addition, the Company may from time to time make oral forward-looking statements. Actual results are uncertain and may be impacted by the following factors. In particular, certain risks and uncertainties that may impact the accuracy of the forward-looking statements with respect to revenues, expenses and operating results include without limitation, cycles of customer orders, general economic and competitive conditions and changing consumer trends, technological advances and the number and timing of new product introductions, shipments of products and components from foreign suppliers, and changes in the mix of products ordered by customers. As a result, the actual results may differ materially from those projected in the forward-looking statements.
 
 **8**
  Because of these and other factors that may affect the Company's operating results, past financial performance should not be considered an indicator of future performance, and investors should not use historical trends to anticipate results or trends in future periods.
 
 The following discussion and analysis provides certain information which the Company's management believes is relevant to an assessment and understanding of the Company's results of operations and financial condition for the three months ended December 31, 2002 and 2001. This discussion should be read in conjunction with the audited financial statements of the Company and notes thereto included in the Annual Report of the Company on Form 10-KSB for the year ended September 30, 2002.
 
 
 General
 
 Net sales. Net sales of $412,024 for the three months ended December 31, 2002 reflect a decline of approximately $488,000 or 54% compared to the same period in the prior year. Sales to the Companys distributors declined approximately $171,000 or 89% in the current quarter, as compared to the prior year quarter; while sales to the Companys dealer network also declined approximately $317,000 or 45% for the same comparison periods. The substantial drop in revenues reflect both the general nationwide economic slump as well as the declining demand for the Companys low-end product lines which are primarily focused on PBX and key system applications. The Company continues to seek and develop applications for its Amanda Portal product line which is expected to ultimately supplant the Companys existing core product lines.
 
 Cost of sales. Cost of sales for the period totaled $176,491, declining approximately $262,000 or 60% from the comparable prior year quarter, which follows the substantial quarter to quarter drop in net sales as discussed above. On the other hand, cost of sales as a percentage of net sales were only 43% during the current quarter, a substantial improvement over the 49% for the prior year quarter, reflecting both the shift in product mix to higher margin products as sales of the low-end products decline, as well as the greater percentage of sales attributable to the Companys dealer base which are more profitable than sales to the Companys distributors.
 
 Selling, general and administrative expenses. Selling, general and administrative expenses of $360,106 for the quarter ended December 31, 2002 decreased by approximately $197,000 or 35% from the comparable prior year quarter. Approximately $140,000 of this decrease resulted from personnel reductions undertaken in response to the declining sales level; while the balance of the decrease primarily reflects the substantial reductions in consulting expenses and other professional services as compared to the prior year quarter.
 
 Other income and expenses. The current quarter results netted a miscellaneous expense of $(120,345) as compared to net miscellaneous expense of $(42,624) for the prior year quarter. Interest expense increased by approximately $39,000 during the current quarter, as compared to the prior year quarter, reflecting the additional debt undertaken by the Company during fiscal 2002. The amortization of deferred debt issuance costs added nearly $34,000 to miscellaneous expense in the current quarter.
 
 **9**
  Extraordinary costs. The Company recorded one-time costs of $876,000 during the prior year quarter. These costs were associated with the merger between Pen Interconnect, Inc. and the Automatic Answer.
 
 Net earnings (loss) and earnings (loss) per share. The net loss for the first fiscal quarter ended December 31, 2002 totaled ($244,918) or ($0.002) per share, as compared to the net loss of ($1,013,881) or ($0.015) per share for the prior year quarter.
 
 Liquidity and Capital Resources
 
 The Company had negative working capital at December 31, 2002 of $3,333,706 compared to negative working capital of $3,145,194 at September 30, 2002 for a decrease in working capital of nearly $189,000 during the current quarter. The working capital decrease during the current quarter is attributable to reductions in current assets totaling $120,566 and increases in current liabilities totaling $67,946. The reductions in current assets included a $48,920 reduction in cash and cash equivalents, a $40,838 drop in inventories, and a $24,141 reduction in receivables; the latter two as a result of the declining sales activity. The increase in current liabilities was primarily affected by a $76,629 increase in accrued liabilities and a $46,523 increase in notes payable, offset by an $81,690 reduction in accounts payable.
 
 Net cash used in operations for the three months ended December 31, 2002 totaled $120,569 as compared to $416,412 for the comparable prior year period, for a reduction of $295,843. The $120,569 in cash used was due primarily to the $271,212 operating loss for the current quarter, offset by $27,618 for the amortization of the beneficial conversion feature, stock issuances for compensation and services totaling $42,767, and $67,133 in cash generated from changes in operating assets and liabilities.
 
 Financing activities provided cash totaling $71,649 for the current quarter, as compared to $449,265 for the comparable prior year quarter, for a reduction of $377,616. This reduction is primarily attributable to the issuance of $570,000 in convertible debentures and promissory notes during the prior year quarter that did not recur during the current quarter. Partially offsetting was the $46,523 increase in notes payable during the current quarter, as compared to the $110,000 reduction in notes payable during the comparable prior year quarter.
 
 Inflation and Seasonality
 
 The Company does not believe that it is significantly impacted by inflation or seasonally.
 
 **10**
  Going Concern
 
 The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed above, the Company has a working capital deficit of $3,333,706 as at December 31, 2002 and has suffered recurring losses from operations which raise substantial doubt about its ability to continue as a going concern. The Company continues to search for further opportunities to cut costs and increase revenues and continues to seek a strong merger partner and/or to find additional equity funding, but there can be no assurance that the Company will be successful in these endeavors. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
 
 
 Item 3  Controls and Procedures
 
 (a)  Evaluation of Disclosure Controls and Procedures. Our Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15 and 15d-15 under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) as of the end of the period covered by this quarterly report (the "Evaluation Date"). Based on such evaluation, such officers have concluded that, as of the Evaluation Date, our disclosure controls and procedures are effective in alerting them on a timely basis to material information relating to our Company (including our consolidated subsidiaries) required to be included in our reports filed or submitted under the Exchange Act.
 
 (b)  Changes in Internal Controls over Financial Reporting. During the most recent fiscal quarter, there have not been any significant changes in our internal controls over financial reporting or in other factors that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.
 
 
 
 
 PART II
 
 OTHER INFORMATION
 
 Item 1. Legal Proceedings.
 
 None
 
 Item 2. Changes in the Securities and Use of Proceeds.
 
 None
 
 Item 4. Submission of Matters to a Vote of Security Holders.
 
 None during the quarter.
 
 Item 5. Other Information. None
 
 Item 6. Exhibits and Reports on Form 8-K.
 
 **11**
  A.  Exhibits
 
 31.1  Certification of the Chief Executive Officer pursuant to Rule 13a-14(a)
 ( Section 302 of the Sarbanes-Oxley Act of 2002)
 
 31.2  Certification of the Chief Financial Officer pursuant to Rule 13a-14(a)
 ( Section 302 of the Sarbanes-Oxley Act of 2002)
 
 32.1  Certification of the Chief Executive Officer pursuant to 18 U.S.C.ss.1350
 (Section 906 of the Sarbanes-Oxley Act of 2002)
 
 32.2  Certification of the Chief Financial Officer pursuant to 18 U.S.C.ss.1350
 (Section 906 of the Sarbanes-Oxley Act of 2002)
 
 
 b.  Reports on Form 8-K
 
 None.
 
 
 **12** 
 Signatures
 
 
 In accordance with Section 13 or 15(d) of the Exchange Act, the Company
 caused this report to be signed on its behalf by the undersigned,
 thereunto duly authorized.
 
 
 Date:  January 21, 2004   THE AMANDA COMPANY, INC.
 
 
 By: /s/ Brian BonarBrian BonarChairman of the Board, ActingChief Executive Officer
 
 In accordance with the requirements of the Securities Act of 1933, this registration statement was signed by the following persons in the capacities and on the dates indicated:
 
 
 /s/ David WooDavid Woo
Director
January 21, 2004
  
 /s/Brian BonarBrian Bonar
Chairman of the Board
January 21, 2004Acting Chief Executive officer
  
 /s/ Steve FryerSteve Fryer
Director
January 21, 2004
  
 /s/ E.Timothy MorganE. Timothy Morgan
Director
January 21, 2004
 
 
 **13**