UNITED STATES

SECURITIES ANDEXCHANGE COMMISSION

WASHINGTON, D.C. 

 

AMENDMENT NO. TWO TO

FORM 10-KSB

 

[ X ] ANNUAL REPORTPURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934

 

For the fiscal yearended December 31, 2004

 

or

 

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

 

Commission File No.000-33037

 

NBO SYSTEMS, INC.

 

| STATE OF		MARYLAND

(State or		Other Jurisdiction of Incorporation or Organization)
55-0795927 

(IRS Employer		Identification Number)

 
3676 West		California Avenue, Building D

Salt Lake		City, Utah 

(Address of		Principal Executive Offices)
84104

(Zip code)
        

(801) 746-8000

(Registrant'sTelephone Number, Including Area Code)

 

Securities registeredunder Section 12(b) of the Act: None

 

Securities registeredunder Section 12(g) of the Act:

common stock, ParValue $.0005

(Title of Class)

Check whether the issuer (1) filed all reports required to be filed bySection 13 or 15(d) of the Exchange Act during the past 12 months (or for suchshorter period that the registrant was required to file such reports), and (2)has been subject to such filing requirements for the past 90 days.

Yes     X     No _____

Check if disclosure of delinquent filers in response to Item 405 ofRegulation S-B is not contained in this form, and no disclosure will becontained, to the best of registrant's knowledge, in definitive proxy orinformation statements incorporated by reference in Part III of this Form 10-KSBor any amendment to this Form 10-KSB. [ X ]

State issuer's revenues and other income for its most recent fiscal year:$12,007,468

The aggregate market value of the common stock held by non-affiliates as ofMarch 31, 2005 was approximately $10,100,000.

As of March 31, 2005, there were 17,124,944 shares of the issuer's commonstock, $0.0005 par value, issued and outstanding. 

DOCUMENTS INCORPORATED BY REFERENCE: Certain information required in Part IIIhereto is incorporated by reference to the issuer's definitive proxy statementrelating to its 2005 annual meeting of stockholders to be filed with theSecurities and Exchange Commission pursuant to Regulation 14A not later than 120days after the end of the fiscal year covered by this Form 10-KSB. 

Transitional Small Business Disclosure Format (check one):

Yes ____ No      X      

NBO SYSTEMS, INC.

FORM 10-KSB ANNUAL REPORT
**TABLE OF CONTENTS**
Page**PART II
          ITEM 8A.		CONTROLS AND PROCEDURES   
1
Forward-looking Statements

This Annual Report on Form 10-KSB, including informationincorporated herein by reference, contains "forward-looking statements" withinthe meaning of Section 27A of the Securities Act of 1933, as amended, andSection 21E of the Securities Exchange Act of 1934, as amended. These statementsrelate to expectations concerning matters that are not historical facts. Wordssuch as "projects," "believes," "anticipates," "will," "estimate," "plans,""expects," "intends," and similar words and expressions are intended to identifyforward-looking statements. Although we believe that such forward-lookingstatements are reasonable, we cannot assure you that such expectations willprove to be correct. Important language regarding factors which could causeactual results to differ materially from such expectations are disclosed in thisReport, including without limitation under the caption "Risk Factors" beginningon page 9 of this Report. All forward-looking statements attributable to NBOSystems, Inc. are expressly qualified in their entirety by such language. We donot undertake any obligation to update any forward-looking statements.
**ITEM 8A. CONTROLS AND PROCEDURES**
We maintain disclosure controls and procedures designed toensure that information required to be disclosed in our reports filed under theSecurities Exchange Act of 1934, as amended (the Exchange Act), is recorded,processed, summarized, and reported within the required time periods, and thatsuch information is accumulated and communicated to our management, includingour Chief Executive Officer and Chief Financial Officer, as appropriate, toallow for timely decisions regarding disclosure.

As required by Rule 13a-15(b) under the Exchange Act, weconducted an evaluation, under the direction of our Chief Executive Officer andour Chief Financial Officer, of the effectiveness of our disclosure controls andprocedures as of December 31, 2004. In connection with the completion of itsaudit of, and the issuance of its report on, our financial statements for theyear ended December 31, 2004, our independent registered public accounting firm,Tanner LC, identified significant deficiencies that require improvements to bemade in the design or operation of our internal control over financialreporting.

The reportable conditions in our internal control overfinancial reporting relate to the capture of all necessary information forcomplete disclosure in the footnotes to the financial statements for therequired periods prior to the auditors' review. The deficiencies were detectedin the audit process and the disclosures have been appropriately presented inthis Form 10-KSB. Based on the matters identified above, our Chief ExecutiveOfficer and Chief Financial Officer concluded that our disclosure controls andprocedures were not effective. These deficiencies have been disclosed to ourAudit Committee. 

We are in the process of improving our internal control overfinancial reporting in an effort to remediate these deficiencies throughimproved supervision and training of our accounting staff and a more robustreview by, and inquiry from, our Chief Executive Officer and Chief FinancialOfficer on a quarterly basis. We will make additional efforts to improve andstrengthen our control processes and procedures. Our management and our auditcommittee will continue to work with our auditors and outside advisors to ensurethat our controls and procedures are adequate and effective. 

1

There has been no change in our internal control overfinancial reporting during the fourth quarter ended December 31, 2004 that hasmaterially affected, or is reasonably likely to materially affect, our internalcontrol over financial reporting. Since the most recent evaluation date, therehave been no significant changes in our internal control structure, policies,and procedures or in other areas that could significantly affect our internalcontrol over financial reporting.

2
**SIGNATURES**
In accordance with Section 13 or 15(d) of the SecuritiesExchange Act of 1934, the registrant caused this Form 10-KSB to be signed on itsbehalf by the undersigned, thereunto duly authorized.

NBO Systems, Inc.

 

By: /s/ Keith A. GuevaraKeith A. Guevara Chairman/President/CEO

Dated: June 13, 2005

In accordance with the Exchange Act, this report has beensigned below by the following persons on behalf of the registrant and in thecapacities and on the dates indicated.
**Signatures** **Title** **Date**     /s/ Keith A. Guevara  President, Chief Executive Officer June 13, 2005Keith A. Guevara and Chairman of the Board of Directors  *Principal Executive Officer     /s/ D. Kent Jasperson 
Chief Accounting Officer, SecretaryJune 13, 2005D. Kent Jaspersonand Treasurer* Principal Accounting Officer /s/ Christopher Foley  Chief Financial Officer and Director June 13, 2005Christopher Foley         /s/ Andrew Boyd-Jones  Director June 13, 2005Andrew Boyd-Jones    ** |
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