**UNITED        STATES SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM        10-KSB**

*(Mark        One)*

þ            Annual report under Section 13 or 15(d) of the Securities Exchange        Act of 1934 for the fiscal year ended**August 31,        2007**.

 

 ̈                Transition report under Section 13 or 15(d)        of the Securities Exchange Act of 1934 (*No fee        required*) for the transition period fromto 

 

Commission file number:**000-33255**

 

**NEWTECH RESOURCES LTD.** 

(Name of        Small Business Issuer in Its Charter)

 

| **Nevada** 

(State or Other Jurisdiction of Incorporation or                        Organization) | **98-0342217**

(I.R.S. Employer Identification No.) |
|---------------------------------------------------------------------------------------------------------|------------------------------------------------------|

                

**2610-1066 West Hastings Street, Vancouver, British Columbia, Canada        V6E 3X2**

(Address        of Principal Executive Offices) (Zip Code)

**(604) 684-4691**

(Issuer’s Telephone Number, Including Area Code)

 

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

 

| Title of Each Class

Common Stock ($0.001 Par Value) |
|------------------------------------------------------|

 

Check        whether the registrant: (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                            þ | No     ̈ |
|--------|------------------------------------------------------------|---------------------------------|

 

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

 

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

 

The        registrant’s net sales for the year ended August 31, 2007, were $0.

 

The        aggregate market value of the registrant’s common stock, $0.001 par value (the only        class of voting stock), held by non-affiliates was approximately $430,461 based on the        average closing bid and asked prices for the common stock on December 13, 2007.

 

At December        13, 2007, the number of shares outstanding of the registrant’s common stock, $0.001        par value (the only class of voting stock), was        29,686,996.             

 

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**TABLE        OF CONTENTS**

 

**PART        I**

 

|   | Page |
|--------|------|

 

| Item 1. | Description of Business | 3 |
|---------|-------------------------|---|

         

| Item 2. | Description of Property | 7 |
|---------|-------------------------|---|

         

| Item 3. | Legal Proceedings | 7 |
|---------|-------------------|---|

         

| Item 4. | Submission of Matters to a Vote of                        Security-Holders | 7 |
|---------|----------------------------------------------------------------------------|---|

         

         

**PART II**

         

| Item 5. | Market for Common Equity and Related Stockholder                        Matters | 7 |
|---------|---------------------------------------------------------------------------------|---|

         

| Item 6. | Management’s Plan of Operation | 8 |
|---------|--------------------------------------|---|

         

| Item 7. | Financial Statements | 13 |
|---------|----------------------|----|

         

| Item 8. | Changes in and Disagreements with Accountants on Accounting                        and |
|---------|----------------------------------------------------------------------------------------|

|   | Financial Disclosure | 14 |
|--------|----------------------|----|

         

| Item 8A | Controls and Procedures | 14 |
|---------|-------------------------|----|

         

| Item 8B | Other Information | 14 |
|---------|-------------------|----|

         

**PART III**

         

| Item 9. | Directors and Executive Officer | 14 |
|---------|---------------------------------|----|

         

| Item 10. | Executive Compensation | 17 |
|----------|------------------------|----|

         

| Item 11. | Security Ownership of Certain Beneficial Owners and                        Management | 17 |
|----------|---------------------------------------------------------------------------------------|----|

         

| Item 12. | Certain Relationships and Related Transactions | 18 |
|----------|------------------------------------------------|----|

         

| Item 13. | Exhibits | 18 |
|----------|----------|----|

         

| Item 14. | Principal Accountant Fees and Services | 18 |
|----------|----------------------------------------|----|

         

|   | Signatures | 19 |
|--------|------------|----|

 

 

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**PART        I**

 

| **ITEM 1.** | **DESCRIPTION OF BUSINESS** |
|-------------|-----------------------------|

 

**Corporate History**

 

As used        herein, the term Company refers to Newtech Resources Ltd., unless the context indicates        otherwise. Newtech Resources Ltd. was organized under the laws of the State of Nevada on        July 27, 1998 and subsequently becameinvolved in the research        and development of glycosylated cystatins and non-glycosylated cystatins pursuant to the        terms of an option agreement with Kaizen Food Corporation (“Kaizen”). The        agreement granted the Company an option to exercise an exclusive license to manufacture,        market, and sub-license the end products of pre-clinical trials of glycosylated cystatins        and non-glycosylated cystatins in exchange for funding Kaizan’s research and        development. On November 25, 2003 Kaizen placed the Company on notice that it was in        default of the terms of the option agreement. The Company was unable to remedy the default        and has since abandoned its agreement with Kaizen.

 

**Selection of a Business**

 

The Company        is now considering other business opportunities either through merger or acquisition that        might create value for its shareholders. The Company has no day-to-day operations at the        present time. Our sole officer and director devotes limited time and attention to the        affairs of the Company.

 

Management        has adopted a conservative policy of seeking opportunities that it considers to be of        exceptional quality. As a result of that policy, the Company may have to wait some time        before consummating a suitable transaction. Management recognizes that the higher the        standards it imposes upon itself, the greater may be its competitive disadvantage when        vying with other acquiring interests or entities.

 

The Company        does not intend to restrict its consideration to any particular business or industry        segment, and the Company may consider, among others, finance, brokerage, insurance,        transportation, communications, research and development, biotechnology, service, natural        resources, manufacturing or high-technology. However, due to the Company’s limited        financial resources, the scope and number of suitable candidate business ventures available        is limited, and most likely the Company will not be able to participate in more than a        single business venture. Accordingly, it is anticipated that the Company will not be able        to diversify, but may be limited to one merger or acquisition. This lack of diversification        will not permit the Company to offset potential losses from one business opportunity        against profits from another.

 

The        decision to participate in a specific business opportunity will be made upon        management’s analysis of the quality of the other firm’s management and        personnel, the anticipated acceptability of new products or marketing concepts, the merit        of technological changes and numerous other factors which are difficult, if not impossible,        to analyze through the application of any objective criteria. In many instances, it is        anticipated that the historical operations of a specific venture may not necessarily be        indicative of the potential for the future because of the necessity to substantially shift        a marketing approach, expand operations, change product emphasis, change or substantially        augment management, or make other changes. The Company will be dependent upon the        management of a business opportunity to identify such problems and to implement, or be        primarily responsible for the implementation of, required changes.

Since the        Company may participate in a business opportunity with a newly organized business or with a        business which is entering a new phase of growth, it should be emphasized that the Company        may incur risk due to the failure of the target’s management to have proven its        abilities or effectiveness, or the failure to establish a market for the target’s        products or services, or the failure to realize profits.

 

 

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The Company        will not acquire or merge with any company for which audited financial statements cannot be        obtained. It may be anticipated that any opportunity in which the Company participates will        present certain risks. Many of these risks cannot be adequately identified prior to        selection of the specific opportunity, and the Company’s shareholders must,        therefore, depend on the ability of management to identify and evaluate such risk. In the        case of some of the opportunities available to the Company, it may be anticipated that the        founders thereof have been unable to develop a going concern or that such business is in        its development stage in that it has not generated significant revenues from its principal        business activities prior to the Company’s participation.

 

**Acquisition of Business**

 

In        implementing a structure for a particular business acquisition, the Company may become a        party to a merger, consolidation, reorganization, joint venture, franchise or licensing        agreement with another corporation or entity. It may also purchase stock or assets of an        existing business. On the consummation of a transaction, it is possible that the present        management and shareholders of the Company will not be in control of the Company. In        addition, the Company’s sole officer and director may, as part of the terms of the        acquisition transaction, resign and be replaced by new officers and directors without a        vote of the Company’s shareholders.

 

The Company        anticipates that any securities issued in any such reorganization would be issued in        reliance on exemptions from registration under applicable federal and state securities        laws. In some circumstances, however, as a negotiated element of this transaction, the        Company may agree to register such securities either at the time the transaction is        consummated, under certain conditions, or at a specified time thereafter. The issuance of        substantial additional securities and their potential sale into any trading market may have        a depressive effect on such market.

 

While the        actual terms of a transaction to which the Company may be a party cannot be predicted, it        may be expected that the parties to the business transaction will find it desirable to        avoid the creation of a taxable event and thereby structure the acquisition in a so called        “tax-free” reorganization under Section 368(a)(1) of the Internal Revenue Code        of 1986, as amended (the “Code”). In order to obtain tax-free treatment under        the Code, it may be necessary for the owners of the acquired business to own 80% or more of        the voting stock of the surviving entity. In such event, the shareholders of the Company        would retain less than 20% of the issued and outstanding shares of the surviving entity,        which could result in significant dilution in the equity of such shareholders.

 

As part of        our investigation, Company management will meet personally with management and key        personnel, may visit and inspect material facilities, obtain independent analysis or        verification of certain information provided, check references of management and key        personnel, and take other reasonable investigative measures, to the extent of the        Company’s limited financial resources and management expertise. The manner in which        each Company participates in an opportunity will depend on the nature of the opportunity,        the respective needs and desires of the Company and other parties, the management of the        opportunity, and the relative negotiating strength of the Company and such other        management. With respect to any mergers or acquisitions, negotiations with target company        management will be expected to focus on the percentage of the Company that target company        shareholders would acquire in exchange for their shareholdings in the target        company.

 

Depending        upon, among other things, the target company’s assets and liabilities, the        Company’s shareholders will in all likelihood hold a lesser percentage ownership        interest in the Company following any merger or acquisition. The percentage ownership may        be subject to significant reduction in the event the Company acquires a target company with        substantial assets. Any merger or acquisition effected by the

 

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Company can        be expected to have a significant dilutive effect on the percentage of shares held by the        Company’s then shareholders.

 

**Operation of Business After Acquisition**

 

The        Company’s operation following its merger or acquisition of a business will be        dependent on the nature of the business and the interest acquired. The Company is unable to        determine at this time whether the Company will be in control of the business or whether        present management will be in control of the Company following the acquisition. It may be        expected that the business will present various challenges that cannot be predicted at the        present time.

 

**Government Regulation**

 

The Company        cannot anticipate the government regulations, if any, to which the Company may be subject        until it has acquired an interest in a business. The use of assets to conduct a business        that the Company may acquire could subject it to environmental, public health and safety,        land use, trade, or other governmental regulations and state or local taxation. In        selecting a business in which to acquire an interest, management will endeavor to        ascertain, to the extent of the limited resources of the Company, the effects of such        government regulation on the prospective business of the Company. In certain circumstances,        however, such as the acquisition of an interest in a new or start-up business activity, it        may not be possible to predict with any degree of accuracy the impact of government        regulation.

 

**Competition**

 

The Company        will be involved in intense competition with other business entities, many of which will        have a competitive edge over the Company by virtue of their stronger financial resources        and prior experience in business. There is no assurance that the Company will be successful        in obtaining suitable business opportunities.

 

**Employees**

 

The Company        currently has no employees. Our executive officer devotes as much time to the affairs of        the Company as she deems appropriate. Management of the Company uses consultants,        attorneys, and accountants as necessary, and does not anticipate a need to engage any        full-time employees as long as business needs are being identified and evaluated. The need        for employees and their availability will be addressed in connection with a decision        concerning whether or not to acquire or participate in a specific business        venture.

 

**Risks        Related to Our Business**

 

Our future        operating results are highly uncertain. Before deciding to invest in us or to maintain or        increase your investment, you should carefully consider the risks described below, in        addition to the other information contained in this annual report. If any of these risks        actually occur, our business, financial condition or results of operations could be        seriously harmed. In that event, the market price for our common stock could decline and        you may lose all or part of your investment.

 

***Our        operating losses may continue into the future, resulting in a decrease in share        value.***

 

Since our        inception in 1998, our expenses have substantially exceeded our revenue, resulting in        continuing losses and an accumulated deficit of $1,212,005 at August 31, 2007. During the        twelve months ended August 31, 2007, we recorded a net loss of $102,047. The Company has        never realized revenue from operations. We will continue to incur operating losses as we        maintain our search for a suitable

 

5

 

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business        opportunity and satisfy our ongoing disclosure requirements with the Securities and        Exchange Commission (“Commission”). Such continuing losses could result in a        decrease in share value.

 

***The        Company’s limited financial resources cast severe doubt on our ability to acquire a        profitable business opportunity.***

 

The        Company’s future operation is dependent upon the acquisition of a profitable business        opportunity. However, the prospect of such an acquisition is doubtful due to the        Company’s limited financial resources. Since we have no current business opportunity,        the Company is not in a position to improve this financial condition through debt or equity        offerings. Therefore, this limitation may act as a deterrent in future negotiations with        prospective acquisition candidates. Should we be unable to acquire a profitable business        opportunity the Company will, in all likelihood, be forced to cease operations.

 

***The        market for our stock is limited and our stock price may be volatile.***

 

The market        for our common stock has been limited due to low trading volume and the small number of        brokerage firms acting as market makers. Because of the limitations of our market and        volatility of the market price of our stock, investors may face difficulties in selling        shares at attractive prices when they want to. The average daily trading volume for our        stock has varied significantly from week to week and from month to month, and the trading        volume often varies widely from day to day.

 

***We        may incur significant expenses as a result of being quoted on the Over the Counter Bulletin        Board, which may negatively impact our financial performance.***

 

We may        incur significant legal, accounting and other expenses as a result of being listed on the        Over the Counter Bulletin Board. The Sarbanes-Oxley Act of 2002, as well as related rules        implemented by the Commission has required changes in corporate governance practices of        public companies. We expect that compliance with these laws, rules and regulations,        including compliance with Section 404 of the Sarbanes-Oxley Act of 2002 as discussed in the        following risk factor, may substantially increase our expenses, including our legal and        accounting costs, and make some activities more time-consuming and costly. As a result,        there may be a substantial increase in legal, accounting and certain other expenses in the        future, which would negatively impact our financial performance and could have a material        adverse effect on our results of operations and financial condition.

 

***Our        internal controls over financial reporting may not be considered effective, which could        result in a loss of investor confidence in our financial reports and in turn have an        adverse effect on our stock price.***

 

Pursuant to        Section 404 of the Sarbanes-Oxley Act of 2002, beginning with our annual report for the        year ending August 31, 2008, we may be required to furnish a report by our management on        our internal controls over financial reporting. Such report will contain, among other        matters, an assessment of the effectiveness of our internal controls over financial        reporting as of the end of the year, including a statement as to whether or not our        internal controls over financial reporting are effective. This assessment must include        disclosure of any material weaknesses in our internal controls over financial reporting        identified by management. If we are unable to assert that our internal controls are        effective as of August 31, 2008, investors could lose confidence in the accuracy and        completeness of our financial reports, which in turn could cause our stock price to        decline.

 

 

 

6

 

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**Reports to Security Holders.**

 

The        Company’s annual report will contain audited financial statements. The Company is not        required to deliver an annual report to security holders and will not voluntarily deliver a        copy of the annual report to the security holders unless requested by same. The Company        files all of its required information with the Commission.

 

The public        may read and copy any materials that are filed by the Company with the Commission at the        Commission’s Public Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549.        The public may obtain information on the operation of the Public Reference Room by calling        the Commission at 1-800-SEC-0330. The statements and forms filed by the Company with the        Commission have also been filed electronically and are available for viewing or copy on the        Commission maintained Internet site that contains reports, proxy and information        statements, and other information regarding issuers that file electronically with the        Commission. The Internet address for this site can be found at        http://www.sec.gov.

 

| **ITEM 2.** | **DESCRIPTION OF PROPERTY** |
|-------------|-----------------------------|

 

The Company        currently maintains its offices at 2610-1066 West Hastings Street, Vancouver, British        Columbia, Canada V6E 3X2. The Company pays no rent for the use of this address. The Company        does not believe that it will need to maintain an office at any time in the foreseeable        future in order to carry out the plan of operation described herein.

 

| **ITEM 3.** | **LEGAL PROCEEDINGS** |
|-------------|-----------------------|

 

The Company        is currently not a party to any pending legal proceeding.

 

| **ITEM 4.** | **SUBMISSION OF MATTERS TO A VOTE OF SECURITY                        HOLDERS** |
|-------------|--------------------------------------------------------------------------------|

 

No matters        were submitted to a vote of security holders during the fourth quarter of the period        covered by this report.

 

**PART        II**

         

| **ITEM 5.** | **MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT’S                        COMMON EQUITY AND OTHER SHAREHOLDER MATTERS** |
|-------------|--------------------------------------------------------------------------------------------------------------------------------|

 

The        Company’s common stock is quoted on the Over the Counter Bulletin Board, under the        symbol, “NTHR.OB”.

 

The table        below sets forth the high and low sales prices for the Company’s common stock for        each quarter of fiscal 2007 and 2006. The quotations below reflect inter-dealer prices,        without retail mark-up, mark-down or commission and may not represent actual        transactions:

 

| **Year** | **Quarter Ended**  | **High** | **Low** |
|----------|--------------------|----------|---------|
| **2007** | August 31          | $0.02    | $0.01   |
|     | May 31             | $0.05    | $0.02   |
|     | February 28        | $0.03    | $0.02   |
|     | November 28 (2006) | $0.03    | $0.02   |

 

 

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| **2006** | August 31          | $0.04 | $0.02 |
|----------|--------------------|-------|-------|
|     | May 31             | $0.07 | $0.03 |
|     | February 28        | $0.06 | $0.02 |
|     | November 30 (2005) | $0.04 | $0.02 |

 

 

**Record Holders**

 

As of        December 13, 2007, there were approximately 30 shareholders of record holding a total of        29,686,996 shares of common stock. The holders of the common stock are entitled to one vote        for each share held of record on all matters submitted to a vote of stockholders. Holders        of the common stock have no preemptive rights and no right to convert their common stock        into any other securities. There are no redemption or sinking fund provisions applicable to        the common stock.

 

**Dividends**

 

The Company        has not declared any cash dividends since inception and does not anticipate paying any        dividends in the foreseeable future. The payment of dividends is within the discretion of        the board of directors and will depend on the Company’s earnings, capital        requirements, financial condition, and other relevant factors. There are no restrictions        that currently limit the Company’s ability to pay dividends on its common stock other        than those generally imposed by applicable state law.

 

| **ITEM 6** | **MANAGEMENT’S PLAN OF OPERATION** |
|------------|------------------------------------------|

 

This*Management‘s Plan of Operation*and*Results of Operations*and other parts of this        report contain forward-looking statements that involve risks and uncertainties.        Forward-looking statements can also be identified by words such as        “anticipates,” “expects,” “believes,”        “plans,” “predicts,” and similar terms. Forward-looking statements        are not guarantees of future performance and our actual results may differ significantly        from the results discussed in the forward-looking statements. Factors that might cause such        differences include, but are not limited to, those discussed in the subsections        entitled*Forward-Looking Statements and Factors That May Affect        Future Results and Financial Condition*below and the subsection        entitled*Risk Factors*above. The        following discussion should be read in conjunction with our financial statements and notes        thereto included in this report. All information presented herein is based on our fiscal        year ended August 31, 2007.

 

**Plan        of Operation**

 

During the        year ended August 31, 2007 and the year ended August 31, 2006, our operations were focused        on identifying a suitable business opportunity for acquisition and satisfying continuous        public disclosure requirements.

 

The Company        has not yet entered into any agreement, nor does it have any commitment or understanding to        enter into or become engaged in any transaction, as of the date of this filing.

 

The        Company’s plan of operation will require $100,000 in funding over the next 12 months        to continue the search for a suitable business opportunity which funding is not currently        available. Should, the Company acquire a suitable business opportunity within the next 12        months its funding requirements may change.

 

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**Results of Operations**

 

The        Company has been funded since inception from public or private debt or equity placements or        by major shareholders in the form of loans. Virtually all of the capital raised to date has        been allocated for general and administrative costs or financial obligations tied to the        defunct option agreement with Kaizan.

 

The Company        does not expect to realize revenue within the next twelve months or until such time as it        enters into a transaction to acquire a revenue producing business.

 

**Net        Losses**

 

For the        period from July 27, 1998 (inception) to August 31, 2007, the Company recorded net losses        of $1,212,005. Net losses for the year ended August 31, 2007 were $102,047 as compared to        $100,089 for the year ended August 31, 2006. The Company’s operating losses are        attributable to general and administrative expenses, research and development costs and        option payments. The general and administrative expenses include incorporation costs,        accounting expenses, professional fees, consulting fees and costs associated with the        preparation of disclosure documentation in connection with registration pursuant to the        Exchange Act of 1934, as amended (“Exchange Act”). The Company did not generate        any revenues during this period.

 

The Company        expects to continue to operate at a loss through fiscal 2008.

 

C**apital Expenditures**

 

The Company        expended no amounts on capital expenditures for the period from inception to August 31,        2007.

 

**Income Tax Expense (Benefit)**

         

The Company        has a prospective income tax benefit resulting from a net operating loss carryforward and        start up costs that will offset any future operating profit.

 

**Impact        of Inflation**

         

The Company        believes that inflation has had a negligible effect on operations over the past three        years.

 

**Liquidity and Capital Resources**

 

The Company        is in the development stage and, since inception, has experienced significant changes in        liquidity, capital resources and shareholders’ equity. The Company had current assets        of $836 as of August 31, 2006. These assets consist solely of cash on hand. Net        stockholders deficiency in the Company was $248,217 at August 31, 2007.

 

Cash flow        used in operating activities was $864,414 for the period from inception to August 31, 2007.        Cash flow used in operating activities was $3,437 for the twelve month period ended August        31, 2007 as compared to cash flow provided by operating activities of $7,343 for the twelve        month period ended August 31, 2006. Cash flow used in operating activities over the        comparative twelve month periods can be attributed to a net loss of $102,047 offset by        accounts payable and accrued expenses of $98,610 in

 

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2007 and a        net loss of $100,089 offset by accounts payable and accrued expenses of $92,746 in        2006.

Cash flow        provided by financing activities was $865,250 for the period from inception to August 31,        2007. Cash flow provided from financing activities was $0 for the twelve month period ended        August 31, 2007 as compared to cash flow provided from financing activities of $10,000 for        the twelve month period ended August 31, 2006. Funds realized from financing activities in        the prior twelve month period can be attributed to the sale of common equity.

 

The        Company’s current assets are insufficient to conduct its plan of operation over the        next twelve (12) months and it will have to seek debt or equity financing to fund minimum        operations. The Company has no current commitments or arrangements with respect to, or        immediate sources of funding. Further, no assurances can be given that funding, if needed,        would be available or available to the Company on acceptable terms. The Company’s        shareholders would be the most likely source of new funding in the form of loans or equity        placements though none have made any commitment for future investment and the Company has        no agreement formal or otherwise. The Company’s inability to obtain funding would        have a material adverse affect on its plan of operation. The Company projects that if no        acquisition candidate is found within the next twelve months its operating requirements        will not exceed $100,000.

 

The Company        has no current plans for the purchase or sale of any plant or equipment.

 

The Company        has no current plans to make any changes in the number of employees.

 

**Off        Balance Sheet Arrangements**

 

As of        August 31, 2007, we have no significant off-balance sheet arrangements that have or are        reasonably likely to have a current or future effect on our financial condition, changes in        financial condition, revenues or expenses, results of operations, liquidity, capital        expenditures, or capital resources that is material to stockholders.

 

**Forward        Looking Statements and Factors That May Affect Future Results and Financial        Condition**

 

The        statements contained in the section titled*Management’s Plan        of Operation*, with the exception of historical facts, are forward        looking statements within the meaning of Section 27A of the Securities Act. A safe-harbor        provision may not be applicable to the forward looking statements made in this prospectus        because of certain exclusions under Section 27A (b). Forward looking statements reflect our        current expectations and beliefs regarding our future results of operations, performance,        and achievements. These statements are subject to risks and uncertainties and are based        upon assumptions and beliefs that may or may not materialize. These statements include, but        are not limited to, statements concerning:

 

|   | § | our anticipated financial performance and business                        plan; |
|--------|--------|---------------------------------------------------------------------------------|

|   | § | the sufficiency of existing capital resources; |
|--------|--------|------------------------------------------------|

|   | § | our ability to raise additional capital to fund cash                        requirements for future operations; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------|

|   | § | uncertainties related to the Company’s future business                        prospects; |
|--------|--------|------------------------------------------------------------------------------------------------|

|   | § | the ability of the Company to generate revenues to fund                        future operations; |
|--------|--------|---------------------------------------------------------------------------------------------------|

|   | § | the volatility of the stock market and; and |
|--------|--------|---------------------------------------------|

|   | § | general economic conditions. |
|--------|--------|------------------------------|

         

We wish to        caution readers that the Company’s operating results are subject to various risks and        uncertainties that could cause our actual results to differ materially from those discussed        or anticipated, including the factors set forth in the section entitled        “*Risk Factors*” included        elsewhere in this report. We also wish to advise readers not to place any undue reliance on        the forward looking statements contained in this report, which reflect our beliefs and        expectations only as of the date of this report. We assume no obligation to update or        revise these forward looking statements to reflect new events or circumstances        or

 

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any changes        in our beliefs or expectations, other that is required by law.

**Critical Accounting Policies**

 

In Note 1        to the attached audited financial statements for the periods ended August 31, 2007 and 2006        included in the Company’s Form 10-KSB, the Company discusses those accounting        policies that are considered to be significant in determining the results of operations and        its financial position. The Company believes that the accounting principles utilized by it        conform to accounting principles generally accepted in the United States of        America.

 

The        preparation of financial statements requires Company management to make significant        estimates and judgments that affect the reported amounts of assets, liabilities, revenues        and expenses. By their nature, these judgments are subject to an inherent degree of        uncertainty. On an on-going basis, the Company evaluates estimates. The Company bases its        estimates on historical experience and other facts and circumstances that are believed to        be reasonable, and the results form the basis for making judgments about the carrying value        of assets and liabilities. The actual results may differ from these estimates under        different assumptions or conditions.

 

***Stock-Based Compensation***

 

On January        1, 2006, we adopted SFAS No. 123 (revised 2004) (SFAS No. 123R), Share-Based Payment, which        addresses the accounting for stock-based payment transactions in which an enterprise        receives employee services in exchange for (a) equity instruments of the enterprise or (b)        liabilities that are based on the fair value of the enterprise’s equity instruments        or that may be settled by the issuance of such equity instruments. In January 2005, the        Securities and Exchange Commission (SEC) issued Staff Accounting Bulletin (SAB) No. 107,        which provides supplemental implementation guidance for SFAS No. 123R. SFAS No. 123R        eliminates the ability to account for stock-based compensation transactions using the        intrinsic value method under Accounting Principles Board (APB) Opinion No. 25, Accounting        for Stock Issued to Employees, and instead generally requires that such transactions be        accounted for using a fair-value-based method. We use the Black-Scholes-Merton        (“BSM”) option-pricing model to determine the fair-value of stock-based awards        under SFAS No. 123R, consistent with that used for pro forma disclosures under SFAS No.        123, Accounting for Stock-Based Compensation. We have elected the modified prospective        transition method as permitted by SFAS No. 123R and accordingly prior periods have not been        restated to reflect the impact of SFAS No. 123R. The modified prospective transition method        requires that stock-based compensation expense be recorded for all new and unvested stock        options, restricted stock, restricted stock units, and employee stock purchase plan shares        that are ultimately expected to vest as the requisite service is rendered beginning on        January 1, 2006, the first day of our fiscal year 2006. Stock-based compensation expense        for awards granted prior to January 1, 2006 is based on the grant date fair-value as        determined under the pro forma provisions of SFAS No. 123.

Prior to        the adoption of SFAS No. 123R, we measured compensation expense for our employee        stock-based compensation plans using the intrinsic value method prescribed by APB Opinion        No. 25. We applied the disclosure provisions of SFAS No. 123 as amended by SFAS No. 148,        Accounting for Stock-Based Compensation – Transition and Disclosure, as if the        fair-value-based method had been applied in measuring compensation expense. Under APB        Opinion No. 25, when the exercise price of the Company’s employee stock options was        equal to the market price of the underlying stock on the date of the grant, no compensation        expense was recognized.

 

11

 

----

 

We account        for equity instruments issued in exchange for the receipt of goods or services from other        than employees in accordance with SFAS No. 123 and the conclusions reached by the Emerging        Issues Task Force (“EITF”) in Issue No. 96-18. Costs are measured at the        estimated fair market value of the consideration received or the estimated fair value of        the equity instruments issued, whichever is more reliably measurable. The value of equity        instruments issued for consideration other than employee services is determined on the        earliest of a performance commitment or completion of performance by the provider of goods        or services as defined by EITF 96-18.

 

***Recent Accounting Pronouncements***

 

In        February 2006, the FASB issued SFAS No. 155, “Accounting for Certain Hybrid Financial        Instruments-an amendment of FASB Statements No. 133 and 140”, to simplify and make        more consistent the accounting for certain financial instruments. SFAS No. 155 amends SFAS        No. 133, “Accounting for Derivative Instruments and Hedging Activities” to        permit fair value remeasurement for any hybrid financial instrument with an embedded        derivative that otherwise would require bifurcation, provided that the whole instrument is        accounted for on a fair value basis. SFAS No. 155 amends SFAS No. 140, “Accounting        for the Impairment or Disposal of Long-Lived Assets”, to allow a qualifying        special-purpose entity to hold a derivative financial instrument that pertains to a        beneficial interest other than another derivative financial instrument. SFAS No. 155        applies to all financial instruments acquired or issued after the beginning of an        entity‘s first fiscal year that begins after September 15, 2006, with earlier        application allowed. This standard is not expected to have a significant effect on the        Company’s future reported financial position or results of operations.

 

In June        2006, the FASB issued FASB Interpretation No. 48, “Accounting for Uncertainty in        Income Taxes-an interpretation of FASB Statement No. 109” (“FIN 48”),        which clarifies the accounting for uncertainty in tax positions. Under FIN 48, the tax        effects of a position should be recognized only if it is “more-likely-than-not”        to be sustained based solely on its technical merits as of the reporting date. FIN 48 also        requires significant new annual disclosures in the notes to the financial statements. The        effect of adjustments at adoption should be recorded directly to beginning retained        earnings in the period of adoption and reported as a change in accounting principle.        Retroactive application is prohibited under FIN 48. We are required to adopt FIN 48 at the        beginning of fiscal 2008. Management is currently evaluating the impact of FIN 48 on the        financial statements. 

In March        2006, the FASB issued SFAS No. 156, “Accounting for Servicing of Financial Assets, an        amendment of FASB Statement No. 140, Accounting for Transfers and Servicing of Financial        Assets and Extinguishments of Liabilities”. This statement requires all separately        recognized servicing assets and servicing liabilities be initially measured at fair value,        if practicable, and permits for subsequent measurement using either fair value measurement        with changes in fair value reflected in earnings or the amortization and impairment        requirements of Statement No. 140. The subsequent measurement of separately recognized        servicing assets and servicing liabilities at fair value eliminates the necessity for        entities that manage the risks inherent in servicing assets and servicing liabilities with        derivatives to qualify for hedge accounting treatment and eliminates the characterization        of declines in fair value as impairments or direct write-downs. SFAS No. 156 is effective        for an entity‘s first fiscal year beginning after September 15, 2006. This adoption        of this statement is not expected to have a significant effect on the Company’s        future reported financial position or results of operations.

 

In        September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” The        objective of SFAS 157 is to increase consistency and comparability in fair value        measurements and to expand disclosures about fair value measurements. SFAS 157 defines fair        value, establishes a framework for measuring fair value in generally accepted accounting        principles, and expands disclosures about fair value measurements. SFAS 157 applies under        other accounting pronouncements that require or permit fair value measurements and does not        require any new fair value measurements. The provisions of SFAS No.

 

12

 

----

 

157 are        effective for fair value measurements made in fiscal years beginning after November 15,        2007. The adoption of this statement is not expected to have a material effect on the        Company‘s future reported financial position or results of operations.

 

 

 

In        September 2006, the FASB issued SFAS No. 158, “Employers’ Accounting for        Defined Benefit Pension and Other Postretirement Plans – an amendment of FASB        Statements No. 87, 88, 106, and 132(R)” This statement requires employers to        recognize the overfunded or underfunded status of a defined benefit postretirement plan        (other than a multiemployer plan) as an asset or liability in its statement of financial        position and to recognize changes in that funded status in the year in which the changes        occur through comprehensive income of a business entity or changes in unrestricted net        assets of a not-for-profit organization. This statement also requires an employer to        measure the funded status of a plan as of the date of its year-end statement of financial        position, with limited exceptions. The provisions of SFAS No. 158 are effective for        employers with publicly traded equity securities as of the end of the fiscal year ending        after December 15, 2006. The adoption of this statement is not expected to have a material        effect on the Company‘s future reported financial position or results of        operations.

 

In        September 2006, the SEC issued Staff Accounting Bulletin        (“SAB”) No. 108, “Considering the Effects of Prior Year        Misstatements when Quantifying Misstatements in Current Year Financial Statements.”        SAB No. 108 addresses how the effects of prior year uncorrected misstatements should        be considered when quantifying misstatements in current year financial statements. SAB        No. 108 requires companies to quantify misstatements using a balance sheet and income        statement approach and to evaluate whether either approach results in quantifying an error        that is material in light of relevant quantitative and qualitative factors. SAB No. 108 is        effective for periods ending after November 15, 2006. The Company is currently        evaluating the impact of adopting SAB No. 108 but does not expect that it will have a        material effect on our financial position and results of operations.

 

In February        2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and        Financial Liabilities”. This Statement permits entities to choose to measure many        financial assets and financial liabilities at fair value. Unrealized gains and losses on        items for which the fair value option has been elected are reported in earnings. SFAS No.        159 is effective for fiscal years beginning after November 15, 2007. The Company is        currently assessing the impact of SFAS No. 159 on our financial position and results of        operations.

 

**Going        Concern**

 

The        Company’s audit expressed substantial doubt as to the Company’s ability to        continue as a going concern as a result of reoccurring losses, lack of revenue generating        activities and an accumulated deficit of $1,212,005 as of August 31, 2007. The        Company’s ability to continue as a going concern is subject to the ability of the        Company to realize a profit from operations and /or obtain funding from outside sources.        Management’s plan to address the Company’s ability to continue as a going        concern includes: (1) obtaining funding from private placement sources; (2) obtaining        additional funding from the sale of the Company’s securities; (3) establishing        revenues from a suitable business opportunity; (4) obtaining loans and grants from various        financial institutions where possible. Although management believes that it will be able to        obtain the necessary funding to allow the Company to remain a going concern through the        methods discussed above, there can be no assurances that such methods will prove        successful.

 

| **ITEM 7.** | **FINANCIAL STATEMENTS** |
|-------------|--------------------------|

 

The        Company’s financial statements for the fiscal year ended August 31, 2007 are attached        hereto as pages F-1 through F-9.

13

 

----

 

**NEWTECH RESOURCES LTD.**

(A        Development Stage Company)

 

**INDEX**

 

         

|   | ***Page*** |
|--------|------------|

         

|   | Report of Independent Registered Public Accounting                        Firm | F-2 |
|--------|--------------------------------------------------------------------------------|-----|

         

|   | Balance Sheet | F-3 |
|--------|---------------|-----|

         

|   | Statements of Operations | F-4 |
|--------|--------------------------|-----|

         

|   | Statements of Stockholders’ Equity                        (Deficit) | F-5 |
|--------|---------------------------------------------------------------------------|-----|

         

|   | Statements of Cash Flows | F-6 |
|--------|--------------------------|-----|

         

|   | Notes to Financial Statements | F-7 |
|--------|-------------------------------|-----|

 

         

         

F-1

 

----

 

**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING        FIRM**

 

To the        Board of Directors and

Stockholders of Newtech Resources Ltd.

 

We have        audited the accompanying balance sheets of Newtech Resources Ltd. as of August 31, 2007 and        2006, and the related statements of operations, stockholders’ equity (deficit), and        cash flows for each of the years then ended and the cumulative amounts since inception.        These financial statements are the responsibility of the company’s management. Our        responsibility is to express an opinion on these financial statements based on our        audits.

 

We        conducted our audits in accordance with the standards of the Public Company Accounting        Oversight Board (United States). Those standards require that we plan and perform the audit        to obtain reasonable assurance about whether the financial statements are free of material        misstatement. The company is not required to have, nor were we engaged to perform, an audit        of its internal control over financial reporting. Our audit included consideration of        internal control over financial reporting as a basis for designing audit procedures that        are appropriate in the circumstances, but not for the purpose of expressing an opinion on        the effectiveness of the company’s internal control over financial reporting.        Accordingly, we express no such opinion. An audit also includes examining, on a test basis,        evidence supporting the amounts and disclosures in the financial statements, assessing the        accounting principles used and significant estimates made by management, as well as        evaluating the overall financial statement presentation. We believe that our 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 Newtech Resources Ltd. as of August 31, 2007 and 2006,        and the results of its operations and its cash flows for years then ended and the        cumulative amounts since inception, 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 2 to the financial statements, the        Company’s revenue generating activities are not in place and the Company has incurred        losses since inception. These conditions raise substantial doubt about its ability to        continue as a going concern. Management’s plans regarding those matters also are        described in Note 2. The financial statements do not include any adjustments that might        result from the outcome of this uncertainty.

 

 

JONES        SIMKINS, P.C.

Logan,        Utah

December 7,        2007

 

         

         

         

         

         

 

F-2

 

----

 

         

| NEWTECH RESOURCES LTD.                           |
|--------------------------------------------------|
| (A Development Stage Company)                    |
| BALANCE SHEET                                    |
| August 31, 2007 and 2006                         |
|                                             |   |   |   |   |
|                                             |   |   |   |   |
| ASSETS                                           |   |   |   |   |
|                                             |   | 2007 |   | 2006 |
| Current assets:                                  |   |   |   |   |
| Cash                                             | $ | 836 |   | 4,273 |
|                                             |   |   |   |   |
| Total current assets                             | $ | 836 |   | 4,273 |
|                                             |   |   |   |   |
|                                             |   |   |   |   |
| LIABILITIES AND STOCKHOLDERS' DEFICIT            |   |   |   |   |
|                                             |   |   |   |   |
| Current liabilities:                             |   |   |   |   |
| Accounts payable and accrued expenses            | $ | 249,053 |   | 150,443 |
|                                             |   |   |   |   |
| Total current liabilities                        |   | 249,053 |   | 150,443 |
|                                             |   |   |   |   |
| Commitments and contingencies                    |   |   |   |   |
|                                             |   |   |   |   |
| Stockholders' deficit:                           |   |   |   |   |
| Common stock, $.001 par value, 30,000,000 shares |   |   |   |   |
| authorized, 29,686,996 and 28,686,996 shares     |   |   |   |   |
| issued and outstanding, respectively             |   | 29,687 |   | 29,687 |
| Additional paid-in capital                       |   | 934,101 |   | 934,101 |
| Deficit accumulated during the development stage |   | (1,212,005) |   | (1,109,958) |
|                                             |   |   |   |   |
| Total stockholders' deficit                      |   | (248,217) |   | (146,170) |
|                                             |   |   |   |   |
| Total liabilities and stockholders' deficit      | $ | 836 |   | 4,273 |

         

         

         

         

         

The accompanying notes are an integral part of these financial        statements

 

F-3

 

----

 

         

| NEWTECH RESOURCES LTD.                    |
|-------------------------------------------|
| (A Development Stage Company)             |
| STATEMENTS OF OPERATIONS                  |
| Years Ended August 31, 2007 and 2006      |
|                                      |   |   |   |   |   |   |
|                                      |   |   |   |   |   |   |
|                                      |   |   |   |   |   | Cumulative |
|                                      |   | 2007 |   | 2006 |   | Amounts |
|                                      |   |   |   |   |   |   |
| Revenue                                   | $ | - |   | - |   | - |
|                                      |   |   |   |   |   |   |
| General and administrative costs          |   | 102,047 |   | 100,089 |   | 1,243,930 |
| Gain on forgiveness of debt               |   | - |   | - |   | (31,925) |
|                                      |   |   |   |   |   |   |
| Loss before income taxes                  |   | (102,047) |   | (100,089) |   | (1,212,005) |
|                                      |   |   |   |   |   |   |
| Provision for income taxes                |   | - |   | - |   | - |
|                                      |   |   |   |   |   |   |
| Net loss                                  | $ | (102,047) |   | (100,089) |   | (1,212,005) |
|                                      |   |   |   |   |   |   |
| Loss per common share - basic and diluted | $ | - |   | - |   |   |
|                                      |   |   |   |   |   |   |
|                                      |   |   |   |   |   |   |
| Weighted average common shares -          |   |   |   |   |   |   |
| basic and diluted                         |   | 29,687,000 |   | 29,438,000 |   |   |

         

         

         

         

         

The accompanying notes are an integral part of these financial        statements

         

         

 

F-4

 

----

 

 

| NEWTECH RESOURCES LTD.                                                       |
|------------------------------------------------------------------------------|
| (A Developmental Stage Company)                                              |
| STATEMENTS OF STOCKHOLDERS' EQUITY                        (DEFICIT)          |
| July 27, 1998 ( Date of Inception) to August 31,                        2007 |
|                                                                         |   |   |   |   |   |   | Deficit |   |   |
|                                                                         |   |   |   |   |   |   | Accumulated |   |   |
|                                                                         |   |   |   |   | Additional |   | During the |   |   |
|                                                                         | Common Stock |   | Paid-in |   | Development |   |   |
|                                                                         | Shares |   | Amount |   | Capital |   | Stage |   | Total |
| Balance at July 27, 1998 (date of inception)                                 | - | $ | - | $ | - | $ | - | $ | - |
| Issuance of common stock to founders                                         | 2,750,000 |   | 2,750 |   | - |   | - |   | 2,750 |
| Issuance of common stock                                                     | 8,250,000 |   | 8,250 |   | 74,250 |   | - |   | 82,500 |
| Issuance of common stock                                                     | 60,000 |   | 60 |   | 149,940 |   | - |   | 150,000 |
| Net loss                                                                     | - |   | - |   | - |   | (134,464) |   | (134,464) |
| Balance at August 31, 1999                                                   | 1,060,000 |   | 11,060 |   | 224,190 |   | (134,464) |   | 100,786 |
| Net loss                                                                     | - |   | - |   | - |   | (126,944) |   | (126,944) |
| Balance at August 31, 2000                                                   | 11,060,000 |   | 11,060 |   | 224,190 |   | (261,408) |   | (26,158) |
| Net loss                                                                     | - |   | - |   | - |   | (167,562) |   | (167,562) |
| Balance at August 31, 2001                                                   | 11,060,000 |   | 11,060 |   | 224,190 |   | (428,970) |   | (193,720) |
| Net loss                                                                     | - |   | - |   | - |   | (252,690) |   | (252,690) |
| Balance at August 31, 2002                                                   | 11,060,000 |   | 11,060 |   | 224,190 |   | (681,660) |   | (446,410) |
| Issuance of common stock for related                                         |   |   |   |   |   |   |   |   |   |
| party notes payable and accrued expenses                                     | 1,483,871 |   | 1,484 |   | 542,741 |   | - |   | 544,225 |
| Net loss                                                                     | - |   | - |   | - |   | (137,136) |   | (137,136) |
| Balance at August 31, 2003                                                   | 12,543,871 |   | 12,544 |   | 766,931 |   | (818,796) |   | (39,321) |
| Issuance of common stock for accounts payable                                | 143,125 |   | 143 |   | 14,170 |   | - |   | 14,313 |
| Net loss                                                                     | - |   | - |   | - |   | (20,596) |   | (20,596) |
| Balance at August 31, 2004                                                   | 12,686,996 |   | 12,687 |   | 781,101 |   | (839,392) |   | (45,604) |
| Issuance of common stock for cash                                            | 16,000,000 |   | 16,000 |   | 144,000 |   | - |   | 160,000 |
| Net loss                                                                     | - |   | - |   | - |   | (170,477) |   | (170,477) |
| Balance at August 31, 2005                                                   | 28,686,996 |   | 28,687 |   | 925,101 |   | (1,009,869) |   | (56,081) |
| Issuance of common stock for cash                                            | 1,000,000 |   | 1,000 |   | 9,000 |   | - |   | 10,000 |
| Net loss                                                                     | - |   | - |   | - |   | (100,089) |   | (100,089) |
| Balance at August 31, 2006                                                   | 29,686,996 |   | 29,687 |   | 934,101 |   | (1,109,958) |   | (146,170) |
| Net loss                                                                     | - |   | - |   | - |   | (102,047) |   | (102,047) |

 

| Balance at August 31, 2007 | 29,686,996 | $ | 29,687 | $ | 934,101 | $ | (1,212,005) | $ | (248,217) |
|----------------------------|------------|---|--------|---|---------|---|-------------|---|-----------|

         

 

The accompanying notes are        an integral part of these financial statements

F-5

 

 

 

 

 

----

 

 

| NEWTECH RESOURCES LTD.                        |
|-----------------------------------------------|
| (A Development Stage Company)                 |
| STATEMENTS OF CASH FLOWS                      |
| Years Ended August 31, 2007 and 2006          |
|                                          |   |   |   |   |   |   |
|                                          |   |   |   |   |   |   |
|                                          |   |   |   |   |   | Cumulative |
|                                          |   | 2006 |   | 2006 |   | Amounts |
| Cash flows from operating activities:         |   |   |   |   |   |   |
| Net loss                                      | $ | (102,047) |   | (100,089) |   | (1,212,005) |
| Adjustments to reconcile net loss to net cash |   |   |   |   |   |   |
| used in operating activities:                 |   |   |   |   |   |   |
| Gain on forgiveness of debt                   |   | - |   | - |   | (31,925) |
| Increase in accounts payable and              |   |   |   |   |   |   |
| accrued expenses                              |   | 98,610 |   | 92,746 |   | 379,516 |
|                                          |   |   |   |   |   |   |
| Net cash used in operating activities         |   | (3,437) |   | (7,343) |   | (864,414) |
|                                          |   |   |   |   |   |   |
| Cash flows from investing activities:         |   | - |   | - |   | - |
|                                          |   |   |   |   |   |   |
| Cash flows from financing activities:         |   |   |   |   |   |   |
| Related party notes payable                   |   | - |   | - |   | 460,000 |
| Issuance of common stock                      |   | - |   | 10,000 |   | 405,250 |
|                                          |   |   |   |   |   |   |
| Net cash provided by financing activities     |   | - |   | 10,000 |   | 865,250 |
|                                          |   |   |   |   |   |   |
| Net increase (decrease) in cash               |   | (3,437) |   | 2,657 |   | 836 |
|                                          |   |   |   |   |   |   |
| Cash, beginning of year                       |   | 4,273 |   | 1,616 |   | - |
|                                          |   |   |   |   |   |   |
| Cash, end of year                             | $ | 836 |   | 4,273 |   | 836 |

         

         

         

         

The accompanying notes are an integral part of these financial        statements

         

F-6

 

----

NEWTECH RESOURCES LTD.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

August 31, 2007 and 2006

 

 

 

Note 1        – Organization and Summary of Significant Accounting Policies

 

Organization

 

The Company        was organized under the laws of the State of Nevada on July 27, 1998 (date of inception).        The Company proposes to seek business ventures that will allow for long-term growth.        Further, the Company is considered a development stage company as defined in SFAS No. 7 and        has not, thus far, commenced planned principal operations.

 

Cash and        Cash Equivalents

 

For        purposes of the statement of cash flows, the Company considers all highly liquid        investments with a maturity of three months or less to be cash equivalents.

 

Income        Taxes

 

Deferred        income taxes are provided in amounts sufficient to give effect to temporary differences        between financial and tax reporting, principally related to deferred start-up costs        incurred during the Company’s development stage activities. For income tax purposes        start-up costs are deferred until the Company begins generating revenue, at which time the        costs are then amortized.

 

Earnings        Per Share

 

The        computation of basic earnings per common share is based on the weighted average number of        shares outstanding during the year.

 

The        computation of diluted earnings per common share is based on the weighted average number of        shares outstanding during the year plus the common stock equivalents which would arise from        the exercise of stock options and warrants outstanding using the treasury stock method and        the average market price per share during the year. Common stock equivalents are not        included in the diluted earnings per share calculation when their effect is antidilutive.        The Company does not have any stock options or warrants outstanding at August 31, 2007 and        2006.

 

Concentration of Credit Risk

 

The Company        maintains its cash in bank deposit accounts, which, at times, may exceed federally insured        limits. The Company has not experienced any losses in such accounts and believes it is not        exposed to any significant credit risk on cash and cash equivalents.

 

Use of        Estimates in the Preparation of Financial Statements

 

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

 

F-7

 

----

NEWTECH RESOURCES LTD.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

August 31, 2007 and 2006

 

 

 

Note 1        – Organization and Summary of Significant Accounting Policies(continued)

 

Recent        Accounting Pronouncements

 

In June        2006, the FASB issued FASB Interpretation No. 48, “Accounting for Uncertainty in        Income Taxes-an interpretation of FASB Statement No. 109” (“FIN 48”),        which clarifies the accounting for uncertainty in tax positions. Under FIN 48, the tax        effects of a position should be recognized only if it is “more-likely-than-not”        to be sustained based solely on its technical merits as of the reporting date. FIN 48 also        requires significant new annual disclosures in the notes to the financial statements. The        effect of adjustments at adoption should be recorded directly to beginning retained        earnings in the period of adoption and reported as a change in accounting principle.        Retroactive application is prohibited under FIN 48. We are required to adopt FIN 48 at the        beginning of fiscal 2008. Management is currently evaluating the impact of FIN 48 on the        financial statements. 

In        September 2006, the FASB issued SFAS No. 157,*Fair Value        Measurements*(SFAS No. 157), which defines fair value,        establishes guidelines for measuring fair value and expands disclosure regarding fair value        measurements. SFAS No. 157 does not require new fair value measurements but rather        eliminates inconsistencies in guidance found in various prior accounting pronouncements.        SFAS No. 157 is effective for financial statements issued for fiscal years beginning after        November 15, 2007, on a prospective basis. The Company does not expect the adoption of SFAS        No. 157 to have a material effect on our financial statements.

 

In        September 2006, the Securities and Exchange Commission issued Staff Accounting Bulletin        (SAB) No. 108, Financial Statements —*Considering the        Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year        Financial Statements*. SAB No. 108 provides interpretive guidance        on how the effects of prior-year uncorrected misstatements should be considered when        quantifying misstatements in the current year financial statements. SAB No. 108 requires        registrants to quantify misstatements using both the income statement and balance sheet        approach and evaluate whether either approach results in a misstatement that, when all        relevant quantitative and qualitative factors are considered, is material. SAB No. 108 is        effective for years ending after November 15, 2006, and the impact of adoption had no        effect on the Company’s financial statements.

 

Note 2 -        Going Concern

 

As of        August 31, 2007 the Company’s revenue generating activities are not in place, and the        Company has incurred a loss for the year then ended. These factors raise substantial doubt        about the Company’s ability to continue as a going concern.

 

Management        intends to seek additional funding through debt or equity financing. There can be no        assurance that such funds will be available to the Company or available on terms acceptable        to the Company.

 

 

F-8

 

----

 

NEWTECH RESOURCES LTD.

(A        Development Stage Company)

NOTES        TO FINANCIAL STATEMENTS

August        31, 2007 and 2006

 

Note 3        – Income Taxes

 

The        difference between income taxes at statutory rates and the amount presented in the        financial statements is a result of the        following:    

|   | Years Ended August 31, |
|--------|------------------------|

|   | 2007 | 2006 |
|--------|------|------|

 

| Income tax benefit at statutory rate | $ | (34,000) | (30,000) |
|--------------------------------------|---|----------|----------|

| Change in valuation allowance | 34,000 | 30,000 |
|-------------------------------|--------|--------|

 

|   | $ | - | - |
|--------|---|---|---|

 

|   | Years Ended August 31, |
|--------|------------------------|

| Deferred tax assets are as follows: | 2007 | 2006 |
|-------------------------------------|------|------|

 

| Start-up costs | $ | 392,000 | 358,000 |
|----------------|---|---------|---------|

| Valuation allowance | (392,000) | (358,000) |
|---------------------|-----------|-----------|

 

|   | $ | - | - |
|--------|---|---|---|

 

As of        August 31, 2007, the Company has start-up costs of approximately $1,154,000. These start-up        costs will begin to be amortized at such time as the Company’s operations        commence.

 

Note 4        – Supplemental Cash Flow Information

 

During the        years ended August 31, 2007 and 2006 the Company paid no interest.

 

Since        inception:

 

|   | **•** | No amounts have been paid for income taxes. |
|--------|------------|---------------------------------------------|

|   | **•** | The Company has issued $1,483,871 shares of common stock in                        exchange for related party notes payable and accrued interest of $460,000                        and $84,225, respectively. |
|--------|------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | **•** | The Company has issued 143,125 shares of common stock in                        exchange for accounts payable of $14,313. |
|--------|------------|---------------------------------------------------------------------------------------------------------------------------|

 

Note 5        – Fair Value of Financial Instruments

 

The        Company’s financial instruments consist of cash and payables. The carrying amount of        cash and payables approximates fair value because of the short-term nature of these        items.

 

Note 6        – Related Party Transactions

 

As of        August 31, 2007 and 2006, accounts payable and accrued expenses include approximately        $199,000 and $107,000, respectively, that is due to officers and shareholders. The amounts        are unsecured, non-interest bearing and due on demand.

 

F-9

 

----

 

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

 

None.

 

| **ITEM 8A.** | **CONTROLS AND PROCEEDURES** |
|--------------|------------------------------|

 

The        Company’s president acts both as the Company’s chief executive officer and        chief financial officer and is responsible for establishing and maintaining disclosure        controls and procedures for the Company.

 

(a)        Evaluation of Disclosure Controls and Procedures

 

Under the        supervision and with the participation of our management, including our principal executive        officer and principal financial officer, we evaluated the effectiveness of the design and        operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and        15d-15(e) under the Exchange Act as of August 31, 2007. Based on this evaluation, our        principal executive officer and our principal financial officer concluded that, as of the        end of the period covered by this report, our disclosure controls and procedures were        effective and adequately designed to ensure that the information required to be disclosed        by us in the reports we submit under the Exchange Act is recorded, processed, summarized        and reported within the time periods specified in the applicable rules and forms and that        such information was accumulated and communicated to our chief executive officer and chief        financial officer, in a manner that allowed for timely decisions regarding required        disclosure.

 

(b) Changes        in Internal Controls

 

During the        period ended August 31, 2007, there has been no change in internal control over financial        reporting that has materially affected, or is reasonably likely to materially affect our        internal control over financial reporting.

 

**ITEM 8B.        OTHER INFORMATION**

 

None.

 

**PART        III**

 

| **ITEM 9.** | **DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL                        PERSONS** |
|-------------|------------------------------------------------------------------------------------------|

 

The        officers and directors of the Company as of December 13, 2007 are as follows:

 

|   | ***Name*** | ***Age*** | ***Position*** |
|--------|------------|-----------|----------------|

         

|   | Nora Coccaro | 50                                   chief                        executive officer, chief financial officer, principal accounting officer,                        and                        director               |
|--------|--------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

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

 

Ms. Coccaro        was appointed as the sole officer and director of the Company on December 5, 2005. She        estimates that she spends approximately 10 percent of her time, approximately 5 hours per        week, on the Company’s business. She also has significant responsibilities with other        companies, as detailed in the following paragraph.

 

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Ms. Coccaro        serves as an officer and director (November 1999 to present) of Providence Resources, Inc.,        an OTC:BB quoted company involved in oil and gas exploration, as an officer and director        (October 2003 to April 2007) of ASP Ventures Corp., an OTC: BB quoted company without        current operations and as an officer and director (March 2007 to present) of Enwin        Resources, Inc., an OTC:BB quoted company without operations. Ms. Coccaro has also served        as an officer and director (February 2004 to March 2007) of Solar Energy Limited, an OTC:        BB quoted company involved in the development of alternative sources of energy, an officer        and director (from January 15, 2000 to March 2007), as an officer and director of Sona        Development Corp., an OTC: BB quoted company without current operations, and as an officer        and director (February 2000 to January 2004) of OpenLimit, Inc., an OTC: BB quoted company        involved in credit card encryption technology. Between 1998 and 2005 Ms. Coccaro also acted        as the Consul of Uruguay to Western Canada.

 

**Term of        Office**

 

Our sole        director has been appointed for a one (1) year term to hold office until the next annual        meeting of our shareholders or until removed from office in accordance with our bylaws. Our        executive officers are appointed by our Board of Directors and hold office until removed by        the board.

 

**Significant Employees**

 

We have no        significant employees other than our officer and director, Ms. Coccaro.

 

**Family        Relationships**

 

There are        no family relationships between or among the directors, executive officers, or persons        nominated or chosen by us to become directors or executive officers.

 

**Compensation**

 

Directors        received no compensation for their services as directors for the fiscal year ended August        31.

 

**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, executive officer, or employee: (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 offences); (3) being subject to        any order, judgment or decree, not subsequently reversed, suspended or vacated, of any        court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending        or otherwise limiting his or her 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 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.

 

 

 

 

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**Audit        Committee**

 

We do not        have a separately-designated standing audit committee. Our entire Board of Directors        performs the functions of an audit committee, but no written charter governs the actions of        our Board of Directors when performing the functions of that would generally be performed        by an audit committee. Our Board of Directors approves the selection of our independent        accountants and meets and interacts with the independent accountants to discuss issues        related to financial reporting. In addition, our Board of Directors reviews the scope and        results of the audit with the independent accountants, reviews with management and the        independent accountants our annual operating results, considers the adequacy of our        internal accounting procedures and considers other auditing and accounting matters        including fees to be paid to the independent auditor and the performance of the independent        auditor.

 

We do not        have an audit committee financial expert because of the size of our company and our board        of directors at this time. We believe that we do not require an audit committee financial        expert at this time because we retain outside consultants who possess these attributes. For        the fiscal year ending August 31, 2007, our Board of Directors: 1) reviewed and discussed        the audited financial statements with management, and 2) reviewed and discussed the written        disclosures and the letter from our independent auditors on the matters relating to the        auditor‘s independence. Based upon our Board of Director’s review and        discussion of the matters above, our Board of Directors authorized inclusion of the audited        financial statements for the year ended August 31, 2007 to be included in this Annual        Report on Form 10-KSB and filed with the Commission.

 

**Code of        Ethics**

 

The Company        has adopted a Code of Ethics within the meaning of Item 406(b) of Regulation S-B of the        Securities Exchange Act of 1934. The Code of Ethics applies to directors and senior        officers, such as the principal executive officer, principal financial officer, controller,        and persons performing similar functions. The Company has incorporated a copy of our Code        of Ethics as Exhibit 14 to this Form 10-KSB. Further, the Company’s Code of Ethics is        available in print, at no charge, to any security holder who requests such information by        contacting the Company.

 

**Compliance with Section 16(a) of the Exchange Act**

 

Section        16(a) of the Exchange Act requires our directors and executive officers and persons who        beneficially own more than ten percent of a registered class of the Company‘s equity        securities to file with the SEC initial reports of ownership and reports of changes in        ownership of common stock and other equity securities of the Company. Officers, directors,        and greater than ten percent beneficial shareholders are required by SEC regulations to        furnish us with copies of all Section 16(a) forms they file.

 

Based        solely upon a review of Forms 3, 4 and 5 furnished to the Company, the Company is aware of        a certain individual who during the period ended August 31, 2006 was either an officer or        director of the Company or who was the beneficial owner of more than ten percent of the        common stock of the Company, and who failed to file, on a timely basis, reports required by        Section 16(a) of the Securities Exchange Act of 1934

 

|   | **•** | Nora Coccaro failed to file a Form 3 or Form 5 despite being                        appointed an officer and director of the Company. |
|--------|------------|---------------------------------------------------------------------------------------------------------------------------------------|

 

 

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| **ITEM 10.** | **EXECUTIVE COMPENSATION** |
|--------------|----------------------------|

 

**Compensation Discussion and Analysis**

 

The        objective of the Company’s compensation program is to provide compensation for        services rendered by our sole executive officer. Since the Company is in the development        stage company the only form of compensation paid is in the form of a consulting fee used to        retain the services of our sole executive officer and director. In the event the Company        determines to increase the compensate of our executive officer in the future the amount of        that consideration will be determined in accordance with market forces and availability of        funding; we have no specific formula to determine compensatory amounts at this time. While        we have deemed that our limited compensatory program is appropriately suited for our        current objectives, we may implement a compensation program to include a salary for our        executive officer and any additional future executive employees, which compensation may        include options and other compensatory elements.

 

**Table**

 

The        following table provides summary information for the year ended August 31, 2007 concerning        cash and non-cash compensation paid or accrued by the Company to or on behalf of (i) the        chief executive officer and (ii) any other employee to receive compensation in excess of        $100,000.

 

| ***Summary Compensation Table*** |
|----------------------------------|
| Name and Principal Position      | Year | Salary

($) | Bonus

($) | Stock Awards

($) | Option

Awards

($) | Non-Equity Incentive Plan Compensation

($) | Change in Pension Value and Nonqualified Deferred                        Compensation

($) | All Other Compensation

($)

                          | Total

($) |
| Nora Coccaro                     | 2007

                         

                          | 42,000

                          | - | -

                          | - | - | - | - | - |

         

         

The Company        has no “Grants of Plan-Based Awards”, “Outstanding Equity Awards at        Fiscal Year-End”, “Option Exercises and Stock Vested”, “Pension        Benefits”, or “Nonqualified Deferred Compensation”. Nor does the Company        have any “Post Employment Payments”.

 

| **ITEM 11.** | **SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND                        MANAGEMENT** |
|--------------|-------------------------------------------------------------------------------------------|

 

The        following table sets forth certain information regarding the beneficial ownership of the        stock of the Company as of December 13, 2007, by each shareholder who is known by the        Company to beneficially own more than 5% of the outstanding common stock, by each director,        and by all executive officers and directors as a group.

 

| Title of Class | Name and Address of Beneficial Ownership        | Amount and nature of Beneficial Ownership | Percent of Class |
|----------------|-------------------------------------------------|-------------------------------------------|------------------|
| Common Stock   | Nora Coccaro                                    | 0                                         | 0%               |
| Common Stock   | All Executive Officers and Directors as a Group | 0                                         | 0%               |

 

 

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| **ITEM 12.** | **CERTAIN RELATIONSHIPS AND RELATED                        TRANSACTIONS** |
|--------------|---------------------------------------------------------------------------|

 

Except as        disclosed below, none of our directors or executive officers, nor any proposed nominee for        election as a director, nor any person who beneficially owns, directly or indirectly,        shares carrying more than 5% of the voting rights attached to all of our outstanding        shares, nor any members of the immediate family (including spouse, parents, children,        siblings, and in-laws) of any of the foregoing persons has any material interest, direct or        indirect, in any transaction over the last two years or in any presently proposed        transaction which, in either case, has or will materially affect us.

 

Nora        Coccaro, our sole officer and director is compensated in the amount of $3,500 a month for        services rendered.

 

| **ITEM 13.** | **EXHIBITS** |
|--------------|--------------|

 

Exhibits        required to be attached by Item 601 of Regulation S-B are listed in the Index to Exhibits        beginning on page 20 of this Form 10-KSB, which is incorporated herein by        reference.

 

| **ITEM 14.** | **PRINCIPAL ACCOUNTANT FEES AND SERVICES** |
|--------------|--------------------------------------------|

 

***Audit        Fees***

 

Jones        Simkins, P.C. provided audit services to the Company in connection with its annual report        for the fiscal years ended August 31, 2007 and 2006. The aggregate fees billed by Jones        Simkins, P.C. for the audit of the Company’s annual financial statements and a review        of the Company’s quarterly financial statements were $25,000 and $ 15,757        respectively.

 

***Audit        Related Fees***

 

Jones        Simkins, P.C. billed to the Company fees of $0 in 2007 and $0 in 2006 for professional        services that are reasonably related to the audit or review of the Company’s        financial statements that are not disclosed in “Audit Fees” above.

 

***Tax        Fees***

 

Jones        Simkins, P.C. billed to the Company fees of $1,000 in 2007 and $263 in 2006 for        professional services rendered in connection with the preparation of the Company’s        tax returns for the respective periods.

 

***All        Other Fees***

 

Jones        Simkins, P.C. billed to the Company no fees in each of 2007 and 2006 for other professional        services rendered or any other services not disclosed above.

 

***Audit        Committee Pre-Approval***

 

The Company        does not have a standing audit committee. Therefore, all services provided to the Company        by Jones Simkins, P.C. as detailed above, were pre-approved by the Company’s board of        directors. Jones Simkins, P.C. performed all work only with their permanent full time        employees.

 

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**SIGNATURES**

 

In        accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report        to be signed on its behalf by the undersigned thereunto duly authorized this        13th day of December 2007

 

 

| **Newtech Resources, Ltd.**

                         

                         

/s/ Nora Coccaro 

Nora Coccaro, Chief Executive Officer, Chief Financial                        Officer, Principal Accounting Officer and Director |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

 

In        accordance with the Exchange Act, this report has been signed below by the following        persons on behalf of the registrant and in the capacities and on the dates        indicated.

 

 

| **Signature**                                                                                                | **Title**        | **Date**                  |
|--------------------------------------------------------------------------------------------------------------|------------------|---------------------------|
|  

/s/ Nora Coccaro 

Nora Coccaro

                         

                          |  

Director |  

December 13, 2007 |

 

 

 

 

 

 

 

 

 

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**INDEX        TO EXHIBITS**

 

| ***Exhibit*** | ***Page*** |
|---------------|------------|

| ***No.*** | ***No.*** | ***Description*** |
|-----------|-----------|-------------------|

         

| 3(i) | * Articles of Incorporation of the Company                        (incorporated by reference to the Form 10-SB filed with the Securities and                        Exchange Commission (“Commission”) on October 16,                        2001). |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 3(ii) | * By-laws of the Company (incorporated by reference to                        the Form 10-SB filed with the Commission on October 16, 2001). |
|-------|---------------------------------------------------------------------------------------------------------------------------------------------------|

| 14 | * Code of Ethics adopted October 24, 2004 (incorporated                        by reference to the Form 10-KSB filed with the Commission on September 13,                        2005). |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 31 | Attached  Certification of the Chief Executive                        Officer and Chief Financial Officer pursuant to Rule 13a-14 of the                        Securities and Exchange Act of 1934, as amended, as adopted pursuant to                        Section 302 of the Sarbanes-Oxley Act of 2002. |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 32 | Attached  Certification of the Chief Executive                        Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as                        adopted pursuant to Section 906 of the Sarbanes-Oxley Act of                        2002. |
|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

         

 

 

 

 

 

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