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

                                AMENDMENT NO. 2
                                       TO
                                  FORM 10-KSB

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

For fiscal year ended September 30, 2005             Commission File No. 0-30801

          [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]

                 For the transition period from ______ to ______

                               MIAD Systems, Ltd.
                 ----------------------------------------------
                 (Name of small business issuer in its charter)

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

                            43 Riviera Drive, Unit 6
                        Markham, Ontario, Canada L3R 5J6
               ---------------------------------------------------
               (Address of principal executive offices) (Zip Code)

                    Issuer's telephone number (905) 479-0214
                                              --------------

Securities registered under Section 12(b) of the Exchange Act: None
Securities registered under Section 12(g) of the Exchange Act:

                          Common Stock, $.001 par value
                          -----------------------------
                                (Title of Class)

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

<PAGE>

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

Issuer's revenues for its most recent fiscal year $8,321,083 (Canadian).

The aggregate market value of the voting common stock held by non-affiliates of
the Registrant as of September 30, 2005: Not Determinable

                                       2
<PAGE>

ITEM 1.  DESCRIPTION OF BUSINESS

(A)  BUSINESS DEVELOPMENT

         Our company, MIAD Systems Ltd., is a Canadian company. We were formed
in March 1993 and began operating our business at that same time. Our senior
management has been substantially the same since we began business. We are
located in the Toronto, Ontario, Canada area.

         We are an established full-line supplier of business computer systems
as well as a provider of computer maintenance, installation and networking
services. MIAD does not sell to individuals. We provide these goods and services
to our major clients who are primarily engaged in the corporate, institutional,
municipal, utilities and education fields, typically as part of their computer
networks.

         On July 10, 2001 we filed a Form 10-SB registration statement with the
Securities and Exchange Commission (SEC) which became effective on September 8,
2001. Since such time, we have become subject to the reporting requirements of
the Securities Exchange Act of 1934.

(B)  BUSINESS OF THE COMPANY

         PRINCIPAL PRODUCTS AND SERVICES AND THEIR MARKETS
         -------------------------------------------------

         MIAD PRODUCT STRATEGY
         ---------------------

         In Canada, MIAD offers its clients an extensive range of business
computer systems and related products. Our broad product offering includes:

     o    desktop, notebook and ruggedized mobile personal computers (PC's) and
          servers;
     o    mass storage devices;
     o    monitors;
     o    printers;
     o    network interface cards;
     o    networking hubs, routers, and switches;
     o    modems and wireless devices;
     o    personal digital assistants;
     o    software;
     o    computer supplies and accessories.

                                       3
<PAGE>

         MIAD's strategy, in selling business computer systems, consists of
combining, in Canada, the disparate strategies adopted by the major computer
system vendors in the United States for sales to the large corporate and
institutional markets.

         MIAD offers its customers both custom assembled and mass produced
systems. Mass produced systems which have predetermined features are sold to
customers through MIAD as an authorized reseller of the manufacturer (also known
as a "business partner" or "solutions partner" in the industry). Custom assembly
systems with features ordered by the customer are assembled by MIAD and sold by
MIAD directly to the customer. MIAD does not engage in any manufacturing.

         MIAD's material product sales revenue streams are comprised of the
following:

         1)       RESELLING OF MAJOR BRANDS.

                  MIAD has formed strategic partnerships with the major systems
         vendors such as IBM, Hewlett-Packard/Compaq, Toshiba, etc. by becoming
         qualified/authorized to resell their pre-configured products to MIAD's
         existing and prospective customers. MIAD has made such arrangements
         with the major peripheral, communications and software vendors such as
         3Com, Cisco, Microsoft, etc. MIAD was appointed a major reseller and
         service provider, in Canada, for Itronix Corporation. Itronix is a
         world-class developer of wireless, rugged computing solutions for
         mobile workers.

         2)       MIAD CUSTOM ASSEMBLY.

                  For clients who require a custom configured system with their
         choice of features and peripherals, MIAD has the capabilities and has
         been selling and assembling the MIAD ULTRA system to meet these unique
         requirements. MIAD does not use refurbished or used products in its
         ULTRA system or any of its other products. MIAD assembles its custom
         systems using components obtained from outside sources.

                                       4
<PAGE>

         MIAD SERVICES STRATEGY
         ----------------------

         To complement our core competencies, increase our customer satisfaction
as well as expand our revenue base into areas closely related to our sales of
computer systems, we are very actively involved in the computer services
business.

         MIAD has been continuously upgrading the skills of its technical staff
in order to qualify as an authorized service provider to provide maintenance and
related services for the systems and equipment it sells.

         We currently offer the following services:

         o    computer depot warranty and non-warranty repair
         o    computer on-site warranty and non-warranty repair
         o    preventative maintenance programs
         o    prepaid two-way courier computer depot repair
         o    advance computer/peripherals exchange programs
         o    data and password recovery
         o    software imaging and custom software loading
         o    hardware configuring, consulting and installation
         o    network configuring, consulting and installation

         These services are a very important focus of our long-term strategy.
Although, they have contributed about 5% of revenues currently and in the past
and may not reach that level in the near term, they have allowed us to solidify
our relationships with our clients and major resellers and opened new doors for
computer product sales to prospects where we have previously only provided
computer maintenance/repair services.

                                       5
<PAGE>

         MIAD SALES STRATEGY
         -------------------

         MIAD's highly trained staff understands information technology and
its use in solving automation problems. MIAD is more than a company that just
fills orders; we specialize in developing creative, cost-effective solutions for
our clients. MIAD has hired experienced computer industry veterans who can,
early in a sales cycle, understand and review the business application that the
prospect is attempting to solve through automation. The MIAD representative,
based on years of experience, can recommend the appropriate product (whether
from IBM, Compaq/HP, Itronix, MIAD, etc.) and the appropriate model/features, as
well as the services of installation, networking, maintenance-depot or on-site
that are best suited to meet the customer's requirements.

         Because MIAD has the capabilities and appropriate authorizations from
major vendors to act as a reseller of their products, it can offer customers a
choice between major brand and custom. In the ruggedized wireless marketplace,
MIAD can provide the Itronix solution to meet the requirements of mobile workers
working in hostile environments. MIAD can provide the best product solution as
industry, market and economic trends change. MIAD continues to expand the
availability of services that it can provide its customers base from warranty
maintenance and repair on-site or depot, advance exchange programs, site and
network planning and installation and customized repair functions.

         The depth of MIAD's product and service offerings is integral to the
Company's strategy of diversification and cross-selling to the customer and
prospect base.

         MIAD has, over the years, invested the time, effort and funds to
develop personnel, infrastructure, credentials, recognition and authorizations
in both computer products and service offerings. With this investment, the
successful installations achieved to-date and a strong economy for computer
systems, MIAD is in a position to capitalize on IT opportunities in the Ontario,
Canada marketplace.

         We do not sell products to individual end-users. Our customers are
primarily corporate and institutional and include many well-known companies as
well as healthcare institutions, utilities, municipalities, private schools and
community colleges in Ontario. All of these clients purchase from us on an "as
needed" basis and although they have made volume purchases in the past, there
are no current at will or long-term commitments with them.

                                       6
<PAGE>

(C)      INDUSTRY AND MARKET OVERVIEW

         The Canadian IT industry is key to the economic health of Canada,
enabling business to be more efficient and effective and helping consumers reap
the benefits of the on-going advances in communications and computing. No other
force has, in recent years, influenced the future of Canada's economy as
information technology according to "Industry Canada", a report published by the
Canada Department of Industry. Canada, in general, is one of the world leaders
in technology development and technology implementation as reported in Industry
Canada.

         MIAD acts as a solutions partner for our clients by working with them
to analyze and then provide them the goods and services that they need to
compete effectively in the marketplace. Our clients require that we understand
their business, their marketplace and what drives their decisions. MIAD works
with clients to review their business requirements, understand technology and
recommend the solutions which are best suited to their needs. Our team members
have extensive industry and technology knowledge and expertise.

         Over the past five years generally and in Canada specifically, the
information technology sales and service industry has undergone significant
consolidation. Reduction in total client orders during the recession, more
restrictive terms and conditions from vendors, reductions in the number of
vendor-authorized resellers and increased price competition have driven several
of the weaker competitors from the market. For the remaining vendors such as
MIAD, the competition for a smaller business base has been very costly and
intense.

         We have successfully implemented our "just-in-time" purchasing and
"build-to-order" model for our private label MIAD ULTRA line of business
computers. This concept is based on the successful model originated by Dell in
the United States. We believe that the significant market penetration by Dell in
the U.S. is an indicator of the market potential for our "build-to-order" model
in Canada, particularly as the economy improves, in the future.

         We have consolidated our expertise in the major vendor products that we
resell and continue to train our technical staff to obtain the additional (and
difficult to obtain) service authorizations. This allows MIAD to become a
full-line and full-service provider to the client and prospect base. As we
introduce new service offerings to the marketplace, generally, we put ourselves
in a better position to be recognized in the product sale environment as a most
viable supplier for new accounts.

                                       7
<PAGE>

         We have been appointed a major reseller and service provider for
Itronix Corporation. Itronix is a world-class developer of wireless rugged
computing solutions for mobile workers.

         In spite of very difficult economic times, we continue actively
soliciting and selling to new accounts. This is in addition to working
diligently at maintaining and increasing the revenue from existing accounts. The
growth through sales to new clients and additional sales to existing clients is
frequently referred to as "organic growth". We expect our organic growth to be
accomplished in three ways:

         1)   continued top-level service to existing clients in order to be
              uniquely positioned for their on-going systems and services
              acquisitions, and

         2)   intensify penetration in the five specific major market segments
              where we already have a presence which include major corporate
              accounts, as well as the institutional, municipal, utilities and
              educational fields

         3)   introduce new products such as the Itronix rugged wireless
              computing solution for mobile workers in Canada.

         We intend to continue to build our presence as a supplier of IT
solutions in Ontario, Canada as an authorized reseller of products purchased
from our major vendors for resale to end users and by the custom assembly of our
computer systems. In addition, we will focus on expanding the number of clients
for the MIAD service offerings in maintenance and repair as well as increasing
the number and diversity of service offerings that we provide. In doing so, we
expect to focus on several priorities:

         1)   growing revenue from the existing customer base;
         2)   enlarging our customer base in Ontario through prospecting
              activities
         3)   possibly increasing the number of sales personnel;
         4)   continuing to enhance the quality of our technology operations;
         5)   developing additional partnerships in the high-end computer and
              data communications marketplace;
         6)   attempt to bolster our financial resources.

                                       8
<PAGE>

(D)      "BUILD-TO-ORDER" MODEL --- THE MIAD ULTRA LINE

         We have distinguished ourselves from other "build-to-order" companies
such as Dell because we are also an approved reseller of brand name vendors. In
addition, we employ our "just-in-time" purchasing and "build-to-order" model of
private label personal computers, the MIAD ULTRA line, to satisfy the custom
requirements of our customer base. We carry a minimal amount of finished goods
but no raw materials inventory. Instead, we acquire our component parts
specifically for our customer orders.

         We are authorized by IBM pursuant to a licensing agreement, to use
IBM's licensed patents in assembling MIAD personal computer systems and servers.
MIAD does not use IBM components in its custom assembled systems. MIAD does not
have agreements with but does select and purchase components for use in these
systems from a list of qualified suppliers in the industry. These include, but
are not limited to, processors from Intel, memory from Toshiba, Hitachi,
Siemens, hard disk drives from Fujitsu, CD ROM drives from Acer and Mitsumi,
floppy disk drives from Panasonic and Mitsumi and CPU boards from ASUS and Acer.

         Our custom manufacturing approach allows our customers to choose from a
wide range of options to be custom assembled by MIAD. These may include options
for memory size, processor type and speed, cache memory, video cards, network
interface, communication speeds, video memory and disk storage among others.
These options are coupled with increased reliability, quality control and a
rapid delivery cycle. Currently, our MIAD ULTRA line, which in the past
represented over 35% of our revenues has now declined, because of current
marketplace pressures, to representing less than 1% of our total annual
revenues.

         Our ability to rapidly deliver a MIAD ULTRA custom system allows us to
keep inventory levels at a minimum due to our "just in time" purchasing while
still being able to deliver the systems exactly to the customer's specifications
with a delivery time, including "burn-in" of three days or less. Our technical
and manufacturing expertise permits us to give our customers better service, not
only on our own products but those of our authorized partners.

                                       9
<PAGE>

         CUSTOMER ADVANTAGES
         -------------------

         The "build-to-order" model for our MIAD ULTRA line of systems provides
extensive advantages to clients in cost savings, quality control, flexible
configuration and fast response to industry trends. The main features of the
"build-to-order" model include:

                  Reduction of Delivery Cycle
                  ---------------------------
                           By its nature, our manufacturing approach permits
                           flexibility of customization combined with very short
                           delivery cycles. We are able to customize systems to
                           clients' needs with our "just-in-time" purchasing and
                           "build-to-order" approach.

                  Cost Savings
                  ------------
                           Working with suppliers to provide "just-in-time"
                           delivery of components reduces overhead costs of
                           warehousing large quantities of components. This
                           overhead cost reduction is enhanced by fast inventory
                           turnover. Costs are further reduced by having the
                           ability to quickly respond to industry trends, thus
                           avoiding obsolete inventory as technologies change.
                           These cost reductions are reflected in our pricing to
                           our clients. These cost savings have, in the past few
                           years, eroded somewhat by the competitive pressures
                           of having many vendors chasing a diminishing prospect
                           base.

                  Ability to Manage Technology Change
                  -----------------------------------
                           Purchasing components, on an "as needed" basis allows
                           us to better react to the constant change in
                           technology and price.

                  Increased Reliability and Quality
                  ---------------------------------
                           Quality control of our MIAD ULTRA line is one of the
                           major reasons that users select the system. After
                           assembling the client's unique configuration, we
                           subject the system to extensive "burn-in" and system
                           testing. Since most failures occur in the first
                           24-48 hours of use, this testing attempts to make the
                           system fail before shipping to the client. This leads
                           to better service and fewer repairs.

         We strive for quality and consistency in our MIAD ULTRA line of
computers. We use only name brand quality components. As part of our quality
control program, we work in concert with our suppliers to provide consistency of
components. Whether a client orders ten systems or 300 systems, components will
be the same.

                                       10
<PAGE>

(F)      RESELLING

         We are an established supplier of computer systems from vendors for
which we act as resellers. We also provide maintenance, installation and
networking services to our major clients in the corporate, institutional and
education fields. In order to become approved and authorized to resell systems
of a name brand vendor such as IBM, Compaq/Hewlett-Packard or Toshiba, among
others, the vendor will qualify the proposed reseller on factors such as current
sales volume, number of sales personnel, industry knowledge, geographical
territory, other authorizations and references. The approved authorization
typically requires that a reseller only sell to end users of the product, take
responsibility for pre- and post-sale support (which includes responding to
technical issues) and commit not to engage in activities contrary to law. The
authorization does not include maintenance which is a separate authorization and
typically consists of providing repair services either under or out of warranty.
There are no other material limitations in the reseller authorizations. A high
volume reseller with the proper technical qualifications may also qualify for
service authorization from the vendor. Reseller authorizations are typically
reviewed by the vendor on an annual basis. To date, neither MIAD nor any vendor
has terminated any reseller agreement.

         Our MIAD ULTRA line system for workstations and other servers provides
our clients with custom configuration, rapid delivery and cost savings.
However, for clients who require standard workstations, notebooks, servers and
high-end servers, we are an authorized reseller of Compaq, Toshiba, Hewlett
Packard, IBM, Microsoft and other well-recognized brands as described below.

         We have been authorized to resell products from major vendors. We have
authorizations from 3Com Systems, Acer, Cisco Systems, Hewlett-Packard/Compaq,
IBM, Intel, Lexmark, Microsoft, Novell and Toshiba. These reseller
authorizations are referred to in the promotional materials of these vendors as
"business partnerships".

         MIAD's responsibilities as an authorized reseller includes securing
orders for the vendor's product and to provide pre- and post-sale support to the
client. This support does not include maintenance which is a separate
authorization which must be independently applied for and approved. The vendor
also has certain responsibilities under the reseller agreement which include
providing authorization to resell products, providing technical product
assistance, direct communication and providing the reseller with advance


                                       11
<PAGE>

confidential information on upcoming product announcements, access to literature
and product/sales training.

         We have also been authorized by Itronix Corporation to resell their
ultra-rugged wireless mobile computers. Itronix is one of the two major
providers of these specialized products in a growing segment of the industry.

         In addition, we are authorized by Microsoft for all software in
addition to being certified as an original equipment manufacturer (OEM) for all
Microsoft products used in the MIAD ULTRA line sold to MIAD customers.

         We have arrangements with the major distributors in Canada to acquire
products. Although we are authorized by the manufacturer to resell their
products, we deal directly with their distributors from whom we actually
purchase the products which we resell to end users. Our acquisition of products
from Ingram-Micro and Synnex, the two largest distributors from whom we acquire
approximately 90% of our products, is based on product availability, price,
credit availability and service. We currently have General Security Agreements
with Ingram Micro and Synnex which secure payment for all goods and services we
purchase from them for resale.

         As a reseller, we earn our revenues through the resale of the products
and services we purchase from our vendors, such as IBM, Toshiba,
Hewlett-Packard/Compaq, etc. through their distributors. We then resell the
products and services to our customers at our price which is higher than the
price we pay the distributor.

                                       12
<PAGE>

(G)      SERVICES AND SUPPORT

         In order to provide technology solutions for our clients, we complement
our computer assembly and distribution with value-added services and support.

Depot and On-Site computer repair
---------------------------------

         As one of a small number of authorized service facilities in Ontario
for IBM, Toshiba, Hewlett-Packard/ Compaq, Itronix, etc., we are authorized to
provide warranty and repair maintenance for desktops, notebooks, servers,
peripherals, etc. We provide these services to the client base where we have
sold the hardware. In other instances, the computer user has acquired his
computer from one of the many non service-authorized vendors and now needs
warranty or maintenance repair. The vendor, IBM for instance, will recommend
that the client deal with an authorized service provider such as MIAD. Not only
do we generate revenue from the service provided, we also acquire a new prospect
for other services and future computer sales.

         We have expanded our penetration of the depot market to the point that
we now typically have over 200 computers per month (principally notebooks)
brought in to our depot for repair. We provide these repair and warranty
services to a number of corporate, institutional and municipal organizations.
For major clients, with installed desktop computers and servers, we can provide
the warranty and maintenance services on their own premises ("on-site").

Networking Services
-------------------

         As a provider of IT solutions, we have the personnel, expertise,
experience and partners to provide turn-key network solutions, from peer-to-peer
networks to 200+ station Novell or Microsoft NT and XP networks. We provide
network design and consultation, facility cabling, project management, network
implementation and support. We work with our clients to provide solutions that
not only meet their current requirements, but will allow integration of future
growth and technology.

                                       13
<PAGE>

Customized Service and Support
------------------------------

         We have developed customized solutions for specific clients which are
now available to our total client base. The services include: prepaid two-way
courier service for depot repair; customer advance exchange programs for
specific devices/peripherals; software imaging and custom software loading; data
recovery; etc.

Technical Procedures
--------------------

         We believe that on-going service and support is the basis for any
long-term partnership with clients.

         At our Markham facility, we have a permanent repair facility with test
equipment, anti-static procedures, a testing LAN set up for product testing and
problem recreation. Our tests can be run under XP, NT, Novell or Windows
95/98/2000.

         For depot repair, the client's system is registered with the service
co-coordinator at the reception area, transferred to the service department
where diagnosis is performed by the MIAD technician. Repair is effected or new
parts are ordered from the manufacturer and installed on the system to replace
the defective components. Turnaround time depends on parts availability from the
manufacturer (IBM, H-P/Compaq, etc.), but generally averages 2 working days.

         For on-site service, initial support calls are placed to our 1-(800)
toll-free number or local phone lines are directed to the technical support
team. We currently have Certified Novell-Netware Engineer ("CNE") and Microsoft
Certified Engineer ("MSCE") personnel along with technicians who specialize in
the manufacturing and support of our ULTRA Series computers. Calls are answered
immediately or a technician will return a call within 30 minutes. Problem
escalation is directed to the service manager. We provide telephone technical
support as well as on-site service. Our on-site service offerings are from 8:30
a.m. to 5:00 p.m. with after hours and weekend service available upon request.

         We use a customized service tracking program to track service calls.
With this tracking program, we track customer information, service issues,
problem resolution, parts usage and serial numbers. This information is then
transferred to our accounting system for invoicing.

         MIAD has also added a new service database that provides customers with
secure remote access to query the status of a repair. This allows them the
facility to pre-plan their service and preventative maintenance needs from their
own site.

                                       14
<PAGE>

(H)      MARKETING AND DISTRIBUTION

         Demand for computer systems in the corporate and institutional
marketplace is driven by many factors, the most significant being price, brand
name recognition, the ability of the system to be customized to the client's
needs and desires, and delivery in a timely manner. Management is not aware of
any manufacturer that currently has a computer system which can meet all of a
client's requirements and desires. The major computer vendors such as IBM,
Hewlett-Packard/Compaq do not custom build computer systems. They do, however,
generally have available 100 to 300 models of reasonably priced pre-configured
computer systems. Conversely, other vendors such as Dell (and MIAD in Canada) do
not typically provide mass produced pre-configured systems but, rather, custom
build systems. For those large users whose businesses require a custom
configured system, a brand name system from a manufacturer such as IBM,
Hewlett-Packard/Compaq is typically not an option due to the fixed nature of
their mass produced computer systems. It is the build-to-order system available
from Dell (and MIAD in Canada) that provides these customers with the unique
custom configuration they need with reasonable pricing and rapid delivery.

         We are significantly smaller than Dell and do not have the name
recognition that they enjoy. This is a competitive disadvantage which is
difficult to overcome due to their greater financial resources. Due to our
smaller size, however, we are able to deal face-to-face with our customers and
develop personal relationships which does provide us with an advantage that our
competitors lack due to their size. In addition, we can usually offer faster
delivery, if necessary, and carry no inventory.

         Our current client base is primarily focused in five major market
segments. This includes (1) major corporate accounts; (2) institutional accounts
to acute care facilities; (3) utilities (4) municipalities and (5) educational
which includes many of the top private schools and community colleges in
Ontario.

         At this stage of our development, we are still a relatively small
player in the Canadian marketplace. However, we believe that we have the
structure and the strategic plan which we hope will allow us to become a more
meaningful participant in the Ontario IT systems and services business. We are
not yet measuring market share in either the corporate, utility, municipal, or
institutional fields. We have had significant success in penetrating the Ontario
private school and community college markets. Although we have secured many of
the top name institutions as our clients, our market share is also still in the
single digit range.

                                       15
<PAGE>

         We intend, during the coming fiscal year, resources permitting, to add
sales representative(s) to the Toronto territory, focus on new accounts
generally and the Itronix product line specifically and increase exposure on our
service offerings featuring IBM, H-P/Compaq warranty and repair service, refine
and improve our electronic presence with emphasis on small and medium business.

(I)      COMPETITIVE BUSINESS CONDITIONS

         Our marketplace is a highly competitive environment. The IT product and
services selling industry is characterized by intense competition based
primarily on: price; product and services availability; speed and accuracy of
delivery; effectiveness of sales programs; credit terms and availability;
ability to tailor specific solutions to customer needs; knowledge of client
interface personnel; quality and breadth of product lines and services. We
believe that we compete favorably with each of these factors.

         We have the ability to provide our clients with either a MIAD custom
assembled system or with a name brand resale. We do not typically compete with
major name brand companies such as IBM, Hewlett-Packard/Compaq or Toshiba in a
situation where the client requires a custom assembled system to meet its unique
specifications. In such situations, it is the customization package and not
price considerations that enable us to attract and maintain customers. When, in
these custom situations, we do compete with a Dell, they have certain
competitive advantages such as their materially greater financial resources,
name recognition and buying power. Size, however, does have its limitations.
Unlike our major, well-financed and well-known competitors, we are able, due to
our smaller size, to work face-to-face with our customers and develop working,
personal relationships. We do not have the additional expense of carrying
inventories and we can, if necessary, provide a faster delivery time in many
instances.

         When our role is reselling, high-end name-brand services (such as IBM
and H-P/Compaq, etc.), to clients and potential clients, we find ourselves
competing with other resellers such as NexInnovations (formerly
EDS/Systemshouse), Quiet Touch Computers, GE Capital Corp., Microage, Compugen,
etc. We believe that we are competitive with these resellers because of our
authorizations to service the brand name lines such as IBM, Toshiba, H-P/Compaq
and our ability to provide technical support, repair, education, networking and
installation services. These factors enable us to effectively compete with
larger, better financed companies. We also work closely with our educational
clients to experiment with new technologies for their businesses and work with
educational associations to secure special prices and configurations for these
clients. We believe that these additional services provide us with a competitive
edge over our competitors and that sets us apart.

                                       16
<PAGE>

(J)      SOURCES OF SUPPLY

         For our "build-to-order" MIAD ULTRA line of business computers, we
purchase name brand quality products from manufacturers such as Intel, Quantum,
ATI, Seagate, Maxtor, Panasonic, Acer, LG Electronics, Fujitsu, and others. Our
purchase of these components is based on price, service and availability from
among a number of distributors based in the Toronto area. These distributors
include Synnex Canada, Supercom, Scan Tech, Bell Micro Products, Ingram Micro
Canada, GB Micro, Tech Data Canada.

         When we supply high end servers from IBM, Hewlett-Packard/Compaq,
Toshiba and others, we also acquire the products based on prices, service and
availability primarily from the larger international distributors in the Toronto
area (Synnex Canada, Ingram Micro Canada, Tech Data Canada, etc.). Supplies for
brand name products from major vendors such as IBM, Compaq, etc. are readily
available from the major distribution companies in Canada, including Ingram
Micro Canada which is the largest in Canada. The major vendors supply the
distributors who, in turn, supply major vendor approved resellers such as MIAD.

         For components required for the ULTRA "build-to-order" model, some of
the peripheral products are identical to those found on the IBM and Compaq
systems and are available from the distributors. More unique devices, such as
cases and memory, are available from component suppliers. The computer products
and accessories that we provide our clients are obtained by us directly from the
manufacturer. This is similar to the manner in which an automobile dealer
acquires service parts and products from the automobile manufacturer such as
Ford or General Motors.

         Shortages of supply typically are not company specific but rather
industry-wide and rare. They have, in the past, generally been caused by natural
disasters such as the earthquakes in Taiwan and Japan a few years ago that
affected chip production on a worldwide basis.

(K)      DEPENDENCE ON MAJOR CUSTOMERS

         Our current customer-base is well diversified and spans multiple
industry groups. These include major corporate, institutional, municipal,
utility and educational customers.

         With a focus on specific industries, we have grown our client-base by
concentrating on diversifying our penetration of each of the specific industry
groups. For the current fiscal year, ending September 30, 2005 (and the
previous fiscal year ended September 30, 2004) no single client represented 10%
or more of our revenue.

                                       17
<PAGE>

(L)      INTELLECTUAL PROPERTY

         We do not have any patents but rely upon licenses from the companies
whose products we purchase. For our MIAD ULTRA line of "build-to-order" business
computers, we are authorized by a non-exclusive license agreement with IBM to
use IBM's licensed patents for personal computers and servers.

         The name of our "build-to-order" business computer, the MIAD ULTRA, is
trademarked in Canada. There are currently no plans to trademark the MIAD ULTRA
line in the United States although we may decide to do so at a later date.

(M)      GOVERNMENT APPROVAL REGULATION AND ENVIRONMENTAL COMPLIANCE

         In Canada, computer systems and computer components must be CSA
(Canadian Standards Association) certified. This certification is similar to
the Underwriters Laboratories (UL) certification in the United States. We only
purchase systems and components that are CSA certified.

         We are subject to Canadian provincial and federal laws governing our
relationship with employees, including minimum wage requirements, overtime,
working and safety conditions requirements. We presently are not the subject of
any governmental proceeding and we are currently in compliance with provincial
and federal regulations in Canada.

(N)      RESEARCH AND DEVELOPMENT

         We do not perform research and development ("R&D") in the traditional
sense. Rather, our R&D activities are primarily focused on
researching/evaluating/sourcing, and quality improvements for the products that
we integrate into our MIAD ULTRA "build-to-order" business computer systems.
This R&D activity is conducted in the technical lab on our premises.

(O)      EMPLOYEES

         As of the date of this filing, we employ 11 persons (all of which are
full-time employees). None of our employees are covered by a collective
bargaining agreement. We believe that our employee relations are satisfactory.

                                       18
<PAGE>

ITEM 2.  PROPERTIES

         Our facilities are located at 43 Rivera Drive, Unit 6, Markham,
Ontario, Canada. The facility is a modern, secure, industrial brick and concrete
block building. We currently occupy 9,800 square feet of warehouse, assembly,
service and office space. The current lease expires in November 2010. Our
monthly rent is $7,000 (Canadian) per month.

ITEM 3.  LEGAL PROCEEDINGS

         From time to time, the Company may be a party to certain claims, suits
and complaints which arise in the ordinary course of business. Currently, there
are no such claims, suits or proceedings, which, in the opinion of management,
if decided against the Company would have a material adverse effect on the
Company's financial position.

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

         Our Annual Meeting of Shareholders was held on November 10, 2005. The
purpose of the meeting was to re-elect Michael Green to serve as a director and
ratify the appointment of Sloan Partners LLP Chartered Accountants to serve as
the Company's independent auditor for the current fiscal year. Mr. Green was the
Company's only director prior to the annual meeting and was the only person to
stand for election to the Board of Directors. These resolutions were passed by
100% of the shareholders represented in person or by proxy representing
3,137,535 shares which is 84.5% of the issued and outstanding shares of the
Corporation.

                                       19
<PAGE>

                                     PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

         Our common stock currently trades on the over-the-counter bulletin
board (OTC:BB) under the trading symbol "MIADF". From June 1999 until our
listing on the OTC:BB in November 2001, we traded in the "pink sheets" under the
trading symbol "MIAD". The following table sets forth the high and low bid
prices of our common stock (USD) for each calendar quarter and subsequent
interim period since our common stock commenced actual trading, as reported by
the National Quotation Bureau and represents inter dealer quotations, without
retail mark-up, mark-down or commission and may not be reflective of actual
transactions:

1999                                         High                        Low
----                                        ------                      ------
Quarter ended June 30                       $1.00                       $1.00
Quarter ended September 30                   1.50                        1.00
Quarter ended December 31                    2.375                       1.375

2000
----
Quarter ended March 31                       2.375                       2.1875
Quarter ended June 30                        3.25                        2.375
Quarter ended September 30                   2.80                        2.6825
Quarter ended December 31                    2.75                        2.75

2001
----
Quarter ended March 31                       2.00                        1.25
Quarter ended June 30                        2.00                        1.96
Quarter ended September 30                   2.25                        1.75
Quarter ended December 31                    2.25                        1.75

                                       20
<PAGE>

2002
----
Quarter ended March 31                       1.90                        1.01
Quarter ended June 30                        2.00                        1.05
Quarter ended September 30                   1.50                        0.29
Quarter ended December 31                    0.25                        0.15

2003
----
Quarter ended March 31                       0.19                        0.07
Quarter ended June 30                        0.35                        0.09
Quarter ended September 30                   0.35                        0.18
Quarter ended December 31                    0.25                        0.12

2004
----
Quarter ended March 31                       0.13                        0.12
Quarter ended June 30                        0.25                        0.08
Quarter ended September 30                   0.12                        0.08
Quarter ended December 31                    0.08                        0.06

                                       21
<PAGE>

2005
----
Quarter ended March 31                       0.11                        0.02
Quarter ended June 30                        0.15                        0.05
Quarter ended September 30                   0.12                        0.06
Quarter ended December 16                    0.07                        0.04

          There can be no assurances that an active public market for the common
stock will develop or be sustained.

HOLDERS:
--------

         As of September 30, 2005 there were 3,711,400 shares issued and
outstanding and 51 shareholders of record.

DIVIDENDS:
----------

         We have not declared any dividends. There are no restrictions on the
common stock that limit the ability of us to pay dividends if declared by the
Board of Directors and the loan agreements and general security agreements
covering the Company's assets do not limit its ability to pay dividends.

          The holders of common stock are entitled to receive dividends when and
if declared by the Board of Directors, out of funds legally available therefore
and to share pro-rata in any distribution to the stockholders. Generally, the
Company is not able to pay dividends if after payment of the dividends, it would
be unable to pay its liabilities as they become due or if the value of the
Company's assets, after payment of the liabilities, is less than the aggregate
of the Company's liabilities and stated capital of all classes.

                                       22
<PAGE>

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

         Except for the historical information contained herein, the matters
discussed in this report are by their nature forward-looking. For the reasons
stated in this report or our SEC filings, or for various unanticipated reasons,
actual results may differ materially. Our operating results may fluctuate on a
quarter-to-quarter basis as a result of a number of factors, including the
competitive and economic factors affecting the Canadian market, production and
assembly delays or difficulties, and the degree of acceptance that the Company's
products achieve during the year.

         The following discussion and analysis provide information that we
believe is relevant to an assessment and understanding of our results of
operation and financial condition for the fiscal year ended September 30, 2005.

         The following discussion should be read in conjunction with the
Financial Statements and related Notes appearing elsewhere in this Form 10-KSB.

         All figures stated herein are in Canadian dollars.

RESULTS OF OPERATIONS
---------------------

Twelve months ended September 30, 2005 compared to same period in 2004.

         Revenues
         --------

         For the fiscal year ended September 30, 2005 our revenues increased by
19.1% from $6,984,990 in the same period in 2004 to $8,321,083.

          According to Gartner (the largest industry watcher), the worldwide PC
market (the Company's marketplace) experienced growth that was better than the
research company had expected during the second half of 2005. Demand for mobile
PC's accelerated sales during this last quarter. Aggressive price cutting was a
significant factor in driving demand for PC's, Gartner reported. It was a
quarter of intense price competition for the vendors. Gartner expects the
operating environment to get yet more difficult in the remainder of the calendar
year as PC replacement opportunities decline.

                                       23
<PAGE>

         MIAD's revenue increase for the current fiscal year, although
significant, is still a disappointing result of the company's marketing plan
that was targeted to combat the lackluster economy and of our strong focus on
finding and closing new account business. The Company's revenue is still at
levels below those achieved prior to the recession.

         Since the downturn in the economy in 2001, MIAD has maintained
relationships and authorizations with the major vendors of servers, desktop and
laptop systems, as well as sought and secured additional service and product
authorizations from top name suppliers and invested in additional technical
staff training.

         The economic downturn contributed to competitive pressures on pricing
and margins. As reported in the Gartner report, the volume increases in the
current period were driven by continued aggressive pricing competition. MIAD has
a lower profit margin on major vendor products which it resells, particularly
laptop computers. Management expects that revenues from service activities such
as repair and maintenance design will, to a limited extent, offset some of the
lost revenues from product sales. Further, since margins from service activities
are currently higher than those from product sales, it is anticipated that
current gross margins as a percentage of total sales can be maintained or
improved, although this cannot be assured.

         MIAD's results, for the current fiscal year 2005, are representative of
the industry's ongoing economic difficulties. The significant pricing pressure
caused by an increasing number of vendors chasing a declining number of purchase
opportunities is being attributed as the cause for the resumption of demand for
computer systems. Current industry forecasts do not contemplate a continuation
of the demand resumption for new nor replacement PC systems. As such, there can
be no assurances for the computer industry generally, nor for MIAD more
specifically, that these purchase decisions will be resumed in the future; nor
that MIAD will have the resources to effectively continue its operations should
this business volume decline or should margin pressures persist.

         MIAD will continue its aggressive program to service its existing
client base and seek to secure new clients. The Company is maintaining
relationships and authorizations with the major manufacturers, investing in
additional staff technical training and focusing on the growth of its service
activities, particularly repair and maintenance as well as developing new
prospects for the ruggedized mobile computer systems. There is currently no
assurance that customer orders will resume at any level that would sustain the
Company on a profitable basis.

         Cost of Sales and Gross Profit
         ------------------------------

         Our gross profit on product sales increased 45.7% to $1,403,974 in the
fiscal year ended September 30, 2005 from $963,544 in the comparable period in
the previous fiscal year. The increase in total gross profit is a direct result
of our increase in total revenue coupled with the improved margin opportunities
earlier in the year. The gross profit margin on product sales increased to 16.9%


                                       24
<PAGE>

in the fiscal year ended September 30, 2005 as compared to 13.8% in the same
fiscal year period ended September 30, 2004 as a result of improved margins
earlier in the year affected by lower margins in the last quarter.

         Cost of sales includes the cost of materials for MIAD's custom
assembled systems, cost of purchases for products which are resold by MIAD and
the cost of parts in MIAD's service revenue. MIAD does not separately quantify
any of these costs.

         Operating Expenses
         ------------------

         Operating expenses decreased from 17.4% of revenue in the fiscal year
period ended September 30,2004 to 16.5% of revenue in the current fiscal year
ended September 30, 2005. The operating expense ratio was higher last fiscal
year ending September 30, 2004 primarily because of the minimum level of
expenditures for items such as payroll, etc. that are required to operate the
business. Operating expenses this current fiscal year, in total, were increased
by a one-time payment by the Company of $85,000, a return of monies paid by a
former client, 360networks, to the United States Bankruptcy Court resulting from
a Chapter 11 claim. The ongoing operating expenses marginally increased from
$1,215,220 in the fiscal year ended September 30, 2004 to $1,290,482 in the
current fiscal year. This total dollar increase is primarily attributable to an
increase in professional fees ($61,025 compared to $26,882 in the previous
year), coupled with an increase in payroll expenses incurred (from $791,836 in
the previous fiscal year to $833,592 in the current fiscal year) and the
corresponding increases in salesmen expenses (from $123,034 in the previous
fiscal year to $143,288 in the current fiscal year). Remaining expense levels
for combined office expenses of rent, general, telephone and utilities as well
as depreciation expenses remained essentially unchanged. The combined bank
charges and interest expense decreased marginally to $44,449 in the fiscal year
ended September 30, 2005 from $50,259 in the fiscal year ended September 30,
2004. Interest expense is payable to our major suppliers based on the total
amount and days outstanding of our accounts payable. The timing delay in MIAD
collecting from its clients and conversely in remitting its outstanding balances
to its major suppliers resulted in the interest charges.

LIQUIDITY AND CAPITAL RESOURCES

         As of September 30, 2005, we had cash on hand of $31,631 compared to
$71,361 as of year-end, September 30, 2004. The net working capital as of
September 30, 2005 was ($321,107) compared to the net working capital as of
year-end September 30, 2004 of ($387,297) reflecting an increase in net working
capital of $66,190. This increase is primarily caused by our operating profit.
During the fiscal year ended September 30, 2005, we generated $69,912 from
operating activities compared to using $187,355 for the same period in the
previous fiscal year. Cash from financing activities decreased to ($105,495) in
the comparable twelve-month period in the fiscal year ended September 30, 2005


                                       25
<PAGE>

to $190,000 in the twelve-month period ended September 30, 2004 due to repayment
of related party (a director) advances. MIAD added $24,524 of capital assets in
the twelve-month period ended September 30, 2004 compared to $4,147 of capital
asset additions in the current fiscal year.

         Two suppliers have security interests which are subordinate to any bank
security interest for all of the assets of MIAD. The total amount owed to the
two suppliers at September 30, 2005 was $1,394,221. MIAD's president has
personally guaranteed all the debts owing to these suppliers, Ingram Micro
Canada, Inc. and Synnex Canada Inc.

           MIAD does not require the addition of any material capital assets and
does not currently have any material commitments for capital expenditures or
material purchase commitments for the coming fiscal year ending September 30,
2006 MIAD's liquidity is derived primarily from cash flow from sales, advances
from director and external sources. Unless the Canadian economy for computer
products generally and MIAD's products and services specifically improve
shortly, MIAD's operations will continue to be a drain on financial resources;
there can be no assurances that the director has the capability nor the
willingness to fund the ongoing money-losing operations of the Company. MIAD's
external sources of liquidity consist of a possible increase in the lines of
credit with major distributors and possible bank financing. Such increases in
lines of credit with major distributors or bank or other debt financing, if
sought, may not be available, or if available, the terms may not be satisfactory
to the Company.

RECENT ACCOUNTING PRONOUNCEMENTS

         In November 2004, the Financial Accounting Standards Board (FASB)
released revised FASB Statement no. 151 (FAS 151), "Inventory Costs- an
amendment of ARB no.43". The new standard requires amounts of idle facility
expense, freight, handling costs, and wasted material (spoilage) to be
recognized as current period charges. It also requires that allocation of fixed
production overheads to the costs of conversion be based on the normal capacity
of the production facilities. The requirements of the standard will be effective
for inventory costs incurred during the fiscal years beginning after June 15,
2005. MIAD is currently evaluating the adoption of FAS 151 but does not expect
that it will have a material impact on its financial position, results of
operations, or cash flows.


         In December 2004, the FASB issued Statement No. 123 (Revised 2004),
"Share-Based Payment" ("Statement 123(R)"), which is a revision of FASB
Statement No. 123, "Accounting for Stock-Based Compensation" ("Statement 123").
Statement 123(R) supersedes APB Opinion No. 25, "Accounting for Stock Issued to
Employees" and amends FASB Statement No. 95, "Statement of Cash Flows".
Generally, the approach in Statement 123(R) is similar to the approach described
in Statement 123. However, Statement 123(R) requires all share-based payments to
employees, including grants of employee stock options, to be recognized in the
income statement based on their fair values. Pro forma disclosure is no longer
an alternative. Effective November 1, 2003, the Company adopted the fair value
accounting method provided for under the Statement. Statement 123(R) will have
no impact on the financial statements of the Company.

                                       26
<PAGE>

         In December 2004, the FASB issued Statement No. 153, "Exchanges of
Non-monetary Assets" ("Statement 153"), an amendment of APB Opinion No. 29,
"Accounting for Non-monetary Transactions". Statement 153 is based on the
principle that exchanges of non-monetary assets should be measured based on the
fair value of the assets exchanged. Statement 153 eliminates the narrow
exception for non-monetary exchanges of similar productive assets and replaces
it with a broader exception for exchanges of non-monetary assets that do not
have commercial substance. Statement 153 is effective for non-monetary asset
exchanges occurring in fiscal periods beginning after June 15, 2005. The
provisions of Statement 153 should be applied prospectively. The Company does
not anticipate that the application of Statement 153 will have an impact on the
financial statements of the Company.

         In May 2005, the FASB issued Statement No.154, "Accounting Changes and
Error Corrections ("Statement 154"), a replacement of the Accounting Principles
Board ("APB") Opinion No. 20, "Accounting Changes" and FASB Statement No. 3,
"Reporting Accounting Changes in Interim Financial Statements." Statement 154
applies to all voluntary changes in accounting principle and changes the
requirements for accounting for and reporting a change in accounting principle.
Statement 154 requires the retrospective application to prior periods' financial
statements of the direct effect of a voluntary change in accounting principle
unless it is impracticable. APB No. 20 required that most voluntary changes in
accounting principle be recognized by including the cumulative effect of
changing to the new accounting principle in net income of the period of the
change. Unless adopted early, Statement 154 is effective for fiscal years
beginning after December 15, 2005. Early adoption is permitted for fiscal years
beginning after June 1, 2005. Statement 154 does not change the transition
provisions of any existing accounting pronouncements, including those that are
in a transition phase as of the effective date of this statement. The Company
does not anticipate that the application of Statement 154 will have an impact on
the financial statements of the Company.

FORWARD-LOOKING STATEMENTS
--------------------------

         In connection with the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995(the "Reform Act"), the Company is providing
cautionary statements identifying important factors that could cause the
Company's actual results to differ materially from those projected in
forward-looking statements made herein. Any statements that express, or involve
discussions as to, expectations, beliefs, plans, objectives, assumptions of
future events or performance are not statements of historical facts and may be
forward-looking. These forward-looking statements are based largely on the
Company's expectations and are subject to a number of risks and uncertainties,
including but not limited to, economic, competitive, regulatory, growth
strategies, available financing and other factors discussed elsewhere in this
report and in documents filed by the Company with the SEC. Many of these factors
are beyond the Company's control. Actual results could differ materially from
the forward-looking statements made. In light of these risks and uncertainties,
there can be no assurance that the results anticipated in the forward-looking
information contained in this report will, in fact, occur. Any forward-looking
statement speaks only as of the date on which such statement is made, and the


                                       27
<PAGE>

Company undertakes no obligation to update any forward-looking statement or
statements to reflect events or circumstances after the date on which such
statement is made or to reflect the occurrence of unanticipated events. New
factors emerge from time to time and it is not possible for management to
predict all of such factors, nor can it assess the impact of each such factor on
the business or the extent to which any factor, or combination of factors, may
cause actual results to differ materially from those contained in any
forward-looking statements.

ITEM 7.  FINANCIAL STATEMENTS

         The financial statements of the Company required by Regulation S-B are
attached to this report. Reference is made to Item 13 below for an index to the
financial statements an financial statement schedules.

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

         There have been no changes or disagreements with our accountants on
accounting and financial disclosure.


ITEM 8A. CONTROLS AND PROCEDURES.

         (a) Disclosure Controls and Procedures. Our management, with the
participation of our President/Chief Financial Officer, has evaluated the
effectiveness of the Company's disclosure controls and procedures (as such term
is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of
1934, as amended, as of the end of the period covered by this report. Based on
such evaluation, our President/Chief Financial Officer has concluded that, as of
the end of such period, the Company's disclosure controls and procedures are
effective.

         (b) Internal Controls Over Financial Reporting. There have not been any
changes in the Company's internal controls over financial reporting (as such
term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during
the most recent fiscal quarter that have materially affected, or are reasonably
likely to materially affect, the Company's internal controls over financial
reporting.


                                       28
<PAGE>

                                    PART III

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

         (A) IDENTIFICATION OF DIRECTORS AND EXECUTIVE OFFICERS
             --------------------------------------------------

         As of September 30, 2005, the directors and executive officers of the
Company, their ages, positions in the Company, the dates of their initial
election or appointment as director or executive officer and the expiration of
their terms as directors are as follows:

                                                                Period Served as
Name               Age    Position                              Director
----               ---    --------                              ----------------
Michael Green      62     President, Chief Executive Officer    Since
                          and Director                          September 1998

         Michael Green has been our President and Chief Executive Officer and
Managing Director of our Board of Directors since September 1998. A chartered
accountant by training, Mr. Green has extensive experience in sales, marketing
and finance of computer products in Canada. From 1993 until September 1998, Mr.
Green was our Business Development Manager and was our only direct sales
representative in our early years of development. Mr. Green was President of
Technical Logistics Systems, a Canadian distributor of specialized printers and
computers from 1983 to 1992 when he joined Adrienne Green, his sister, to form
MIAD Systems Ltd. in 1993. From 1977 to 1983 he was one of the founders of ESSNA
Ltd., the distributor of Epson printers in Canada. From 1968 to 1972, Mr. Green
was an accountant with Price Waterhouse. After completing his required program
for licensing as a chartered accountant at Price Waterhouse, Mr. Green became
controller of Mercedes-Benz Canada from 1972 to 1974, then Controller of Memorex
Canada (a computer peripheral products company) from 1974 to 1977. Mr. Green
obtained his Bachelor of Arts degree from the University of Toronto and his
Chartered Accountant Certification in Ontario with Price Waterhouse.

         All directors hold office until the next annual meeting of shareholders
of the Company and until their successors are elected and qualified. Officers
hold office until the first meeting of directors following the annual meeting of
shareholders and until their successors are elected and qualified, subject to
earlier removal by the Board of Directors.

                                       29
<PAGE>

         INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS:

         None of our officers, directors, promoters or control persons have been
involved in the past five (5) years in any of the following:

         (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 proceedings or being subject to a
                  pending criminal proceeding (excluding traffic violations and
                  other minor offenses);

         (3)      Being subject to any order, judgment or decree, not
                  subsequently reversed, suspended or vacated, or any court of
                  competent jurisdiction, permanently or temporarily enjoining,
                  barring, suspending or otherwise limiting his involvement in
                  any type of business, securities or banking activities; or

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

         (b) DIRECTORSHIPS
             -------------

         None of the Company's executive officers or directors is a director of
any company with a class of equity securities registered pursuant to Section 12
of the Securities exchange Act of 1934 (the "Exchange Act") or subject to the
requirements of the Exchange Act or any company registered as an investment
company under the Investment Company Act of 1940.

         (c) FAMILY RELATIONSHIPS
             --------------------

         Michael Green, our President and Chief Executive Officer and a
director, and Adrienne Greene, a holder of more than 10% of our common stock,
are brother and sister.

                                       30
<PAGE>

ITEM 10. EXECUTIVE COMPENSATION

         The following table sets forth the compensation of our management for
the past four fiscal years. Michael Green, our President and Chief Executive
Officer is the only member of our current management that earned $100,000 or
more in each of the last four fiscal years.
<TABLE>
<CAPTION>
                                  Summary Compensation Table
                                                                                       Long Term Compensation
                                                                                       ----------------------
                                       Annual Compensation                         Awards                Payouts
Name and                     -----------------------------------------  ----------------------------     -------
principal          Fiscal    Base                         Annual        Restricted       Under-lying     LTI          Other
position           Year      Salary         Bonus         Compensation  Stock Awards     Options         Pay-outs     Compensation
---------          ------    ------         -----         ------------  ------------     -----------     --------     ------------
<S>                <C>       <C>            <C>           <C>            <C>              <C>             <C>         <C>
                   2005      150,000        none          150,00         none             none            none        none
Michael Green
President CEO      2004      100,000        none          100,000        none             none            none        none
and Director
                   2003      100,000        16,000        116,000        none             none            none        none

                   2002      100,000        none          100,000        none             none            none        none

                   2001      180,000        15,000        195,000        none             none            none        none
</TABLE>

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

         All reports required by Section 16(a) of the Exchange Act were not
timely filed by all directors and beneficial owners of more than ten (10%)
percent of any class of equity securities of the Company registered pursuant to
Section 12 of the Act. The Form 3 for each of Mr. Green and for Ms. Green were
filed in November 2001.

                                       31
<PAGE>

OPTION GRANTS IN 2005

         The Board of Directors granted no options in 2005.

AGGREGATED OPTION/ EXERCISES AND FISCAL YEAR-END OPTIONS/EXERCISES
<TABLE>
<CAPTION>
                                      OPTIONS                                          EXERCISE
                               --------------------                               ---------------------
                                                                                              Shares
                               Shares        Option               Start           Expiry      Exercised
Grant Month        Year        Optioned      Price                Date            Date        9/30/05
-----------        ----        --------      ------               -----           ------      ---------
<S>                <C>          <C>            <C>                 <C>             <C>         <C>
June               1999         160,000        $ 0.20              June/01         June/06     none

September          2001          40,000        $ 1.75              Sept/02         Sept/06     none

September          2002          25,000        $ 0.69              Sept/03         Sept/07     none
</TABLE>

                                                               Stock Options
                                                                Outstanding
                                                               -------------
Outstanding at beginning of year                                  225,000

Granted during year                                               -------

Exercised                                                         -------

Canceled                                                          -------

Outstanding at end of year (9/30/05)                              225,000


Exercisable at end of year (9/30/05)                              225,000

                                       32
<PAGE>

LONG TERM INCENTIVE PLAN (ALTIP) AWARDS TABLE
---------------------------------------------

         None

COMPENSATION OF DIRECTORS
-------------------------

         None

EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND
CHANGE OF CONTROL ARRANGEMENTS
------------------------------------------------------

         (a) Employment Agreements

         Mr. Green currently has a one year employment agreement that provides
for an annual salary of $200,000 (Canadian) per year. He also is entitled to
earn a sales commission at the rate of $5,000 for each $1,000,000 of sales
achieved by us in the fiscal year up to the first $10,000,000 of sales. If sales
exceed $10,000,000, he will receive a bonus of $20,000. For sales above
$10,000,000, his bonus will be $12,000 for each $1,000,000 of sales. Mr. Green
also will be entitled to receive a bonus of 4% of our pre-tax profit. The
employment agreement also provides a covenant by Mr. Green that he will not
compete with or solicit any business of MIAD for a three year period from
employment termination. This employment agreement has been extended for
additional one year terms and expires in October 2006. Mr. Green did not receive
the full amount to which he was entitled, as per his compensation agreement, in
the fiscal year ended September 30, 2005 (nor in any previous fiscal year). In
addition, Mr. Green has personally guaranteed all debts owing to Ingram Micro
Canada, Inc. and Synnex Canada MIAD's major suppliers.

         (b) TERMINATION OF EMPLOYMENT AGREEMENTS

         None

         (c) CHANGE OF CONTROL ARRANGEMENTS

         None

                                       33
<PAGE>

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         (a) SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
             -----------------------------------------------

         The following information relates to those persons who are the
beneficial owners of five percent or more of our outstanding voting common
stock:
<TABLE>
<CAPTION>
Title of                Name and Address of                 Amount and Nature of
Class                   Beneficial Owner                    Beneficial Owner (1)         Percentage of Class (2)
--------                -------------------                 --------------------         -----------------------
<S>                     <C>                                 <C>                          <C>
Common                  Michael Green                       1,960,000                    52.8%
                        178 Ridley Blvd.
                        Toronto, Ontario, Canada

Common                  Adrienne Green                      490,000                      13.2%
                        5096 Bloomington Road
                        Stouffville, Ontario, Canada
</TABLE>

----------
(1)  These shares are directly owned by each individual.
(2)  Percentage is based upon 3,711,400 shares of common stock outstanding on
     September 30, 2005.

                                       34
<PAGE>

         (b) SECURITY OWNERSHIP OF MANAGEMENT
             --------------------------------

         The following table has been completed for each of the shares of common
stock beneficially owned by our directors, nominees, and executive officers and
all officers and directors as a group:
<TABLE>
<CAPTION>
Title of                Name and Address of         Amount and Nature of
Class                   Beneficial Owner            Beneficial Owner (1)         Percentage of Class (2)
--------                -------------------         --------------------         -----------------------
<S>                     <C>                         <C>                          <C>
Common                  Michael Green               1,960,000                    52.8%
                        178 Ridley Blvd.
                        Toronto, Ontario

All officers and                                    1,960,000                    52.8%
directors as a group (1
person)
</TABLE>

----------
(1)  These shares are directly owned by the individual.
(2)  Percentage is based upon 3,711,400 shares of common stock outstanding on
     September 30, 2005.

STOCK OPTION PLAN

         In June 1999 the Board of Directors approved a Stock Option Plan (the
"Plan") which authorizes that up to a maximum of 15% of the Company's issued and
outstanding common stock is available to be issued under the Plan to those
persons who can participate in the Plan in accordance with its terms. Options to
purchase an aggregate of 160,000 shares of our common stock (the "Options") were
approved by the Board of Directors in June 1999 for two persons and ratified by
our shareholders when they approved the Plan at our shareholders meeting held on
April 24, 2001. The Options have an exercise price of $.20 (USD) per share and
are exercisable, in part, at any time from June 17, 2001 until June 17, 2006.
The exercise price was determined by the Board at a time prior to the Company's
common stock being listed for trading in the "pink sheets". Options to purchase
an aggregate of 40,000 shares of our common stock were approved by the Board of
Directors on September 24, 2001. These options have an exercise price of $1.75
(USD) per share and are exercisable, in part, at any time from September 24,
2002 until September 24, 2006. In addition, options to purchase an aggregate of
25,000 shares of our common stock were approved by the Board of Directors on
September 20, 2002. The options have an exercise price of $0.69(USD) per share
and are exercisable, in part, at any time from September 20,2003 until September
20,2007. In both of these latter instances, the exercise price per share of
common stock was the fair market value on the date on which the option was
granted The Plan provides that no resident of the United States may be a
participant in the Plan unless such participation would not violate any
applicable securities or other laws of the United States or any state, territory
or possession of the United States.

                                       35
<PAGE>

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         During the past two (2) years, we have not entered into a transaction
with a value in excess of $60,000 with an officer, director or beneficial owner
of 5% or more of our common stock except as described under Item 9(c) entitled
"Identification of Certain Significant Employees" and Item 4. entitled
"Employment Agreements" and as follows:

         In July 2000, we entered into security agreements with each of our two
major suppliers. Our President, Michael Green, has personally guaranteed all of
the debts owing to Ingram Micro Canada, Inc. and Synnex Canada.. The amount of
the debt guaranteed by Mr. Green to Ingram Micro at September, 2005 was $213,985
(Canadian) and to Synnex Canada was $1,180,233(Canadian).

ITEM 13. EXHIBITS, FINANCIAL STATEMENTS AND REPORTS ON FORM 10-K

         (a)      DOCUMENTS FILED AS A PART OF THIS REPORT
                  ----------------------------------------

                  See Part F/S below for an index to the Financial Statements
                  attached which are included as an integral part of this
                  Report.

         (b)      REPORTS ON FORM 10-K
                  --------------------

                  None

                                       36
<PAGE>

PART F/S.   FINANCIAL STATEMENTS OF MIAD SYSTEMS, LTD.

            Report of Independent Registered Public Accounting Firm
            Audited Balance Sheet as of September 30, 2005 and 2004
            Audited Statements of Operations for the year ended
              September 30, 2005 and 2004
            Audited Statement of Shareholders' Equity for the year ended
              September 30, 2005 and 2004
            Audited Statements of Cash Flows for the year ended
              September 30, 2005 and 2004
            Notes to Audited Financial Statements

                            INDEX TO EXHIBITS


         3.0      Articles of Incorporation of MIAD Systems Ltd.*
         3.1      Articles of Amendment of Articles of Incorporation*
         3.2      Bylaws*
         4.0      Warrant Certificate*
         10.0     Office Lease dated November 14, 1996*
         10.1     Lease Renewal Agreement dated November 1, 2005**
         10.2     Employment Agreement for Michael Green dated October 1, 1999*
         10.3     Renewal Employment Agreement for Michael Green dated
                  October 3, 2005**
         10.4     Stock Option Plan*
         10.5     Security Agreement with Merisel Canada, Inc.*
         10.6     Security Agreement with Ingram Micro Canada, Inc.*
         31.1     Certification by Chief Executive and Chief Financial Officer
         31.2     Certification Pursuant to 18 U.S.C. Section 1350, Section 906
                  Sarbanes-Oxley Act 2002
----------
*     Filed as an exhibit to Form 10-SB filed with the SEC on July 10, 2001
**    Previously filed


                                       37
<PAGE>

                                 SIGNATURE PAGE

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

                                        MIAD  SYSTEMS, LTD.


Date:   March 28, 2005                  By: /s/ Michael A.S. Green
                                            ----------------------
                                            Michael A. S. Green, President
                                            and Principal Financial Officer

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

/s/ Michael A.S. Green                               March 28, 2005
----------------------                               --------------
President and Director

                                       38

<PAGE>

                                MIAD SYSTEMS LTD.

                              FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED SEPTEMBER 30, 2005 AND 2004

                                       AND

             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


<PAGE>

                                MIAD SYSTEMS LTD.

                          INDEX TO FINANCIAL STATEMENTS

                                                                            PAGE
                                                                            ----

Report of Independent Registered Public Accounting Firm                   F-2
Comments by Auditors for U.S. Readers on Canada - U.S.
  Reporting Differences                                                   F-3
Balance Sheet                                                             F-4
Statement of Income                                                       F-5
Statement of Shareholders' Equity                                         F-6
Statement of Cash Flows                                                   F-7
Notes to the Financial Statements                                       F-8-F-15

                                      F-1
<PAGE>

             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of
MIAD SYSTEMS LTD.

We have audited the balance sheet of MIAD Systems Ltd. as at September 30, 2005
and 2004, and the statements of income, shareholders' equity and cash flows for
the year then ended. 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 audit.

We conducted our audit in accordance with Canadian generally accepted auditing
standards and 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 whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.

In our opinion, these financial statements present fairly, in all material
respects, the financial position of MIAD Systems Ltd. as of September 30, 2005
and 2004 and the results of its operations and its cash flows for the year then
ended in accordance with Canadian generally accepted accounting principles.

                                                           Sloan Partners LLP
Thornhill, Ontario                                         Chartered Accountants
December 14, 2005

                                      F-2
<PAGE>

                      COMMENTS BY AUDITORS FOR U.S. READERS
                     ON CANADA - U.S. REPORTING DIFFERENCES

In the United States, reporting standards for auditors require the addition of
an explanatory paragraph (following the opinion paragraph) when the financial
statements are affected by conditions and events that cast substantial doubt on
the Company's ability to continue as a going concern, such as those described in
Note 2 to the financial statements.

The opinion on page 1 is expressed in accordance with Canadian reporting
standards, which do not permit a reference to such events and conditions in the
auditors' report when these are adequately disclosed in the financial
statements.

                                                           Sloan Partners LLP
Thornhill, Ontario                                         Chartered Accountants
December 14, 2005

                                      F-3
<PAGE>

                                MIAD SYSTEMS LTD.

                                  BALANCE SHEET
                           SEPTEMBER 30, 2005 AND 2004
                   (ALL AMOUNTS EXPRESSED IN CANADIAN DOLLARS)
<TABLE>
<CAPTION>
                                      ASSETS                       2005             2004
                                                               -----------      -----------
<S>                                                            <C>              <C>
CURRENT ASSETS
    Cash and cash equivalents                                  $    31,631      $    71,361
    Accounts receivable (Notes 4 and 5)                          1,089,594          770,438
    Inventory (Note 6)                                             170,141           39,100
    Prepaid expenses                                                27,351           15,000
    Loan receivable - related party (Note 7)                        55,495               --
                                                               -----------      -----------

                                                                 1,374,212          895,899

CAPITAL ASSETS (Note 8)                                            162,957          200,655
                                                               -----------      -----------

                                                               $ 1,537,169      $ 1,096,554
                                                               ===========      ===========

                                   LIABILITIES

CURRENT LIABILITIES
    Accounts payable and accrued liabilities (Note 9)          $ 1,695,319      $ 1,233,196
    Loan payable - related party (Note 7)                               --           50,000
                                                               -----------      -----------

                                                                 1,695,319        1,283,196
                                                               -----------      -----------

                              SHAREHOLDERS' EQUITY

CAPITAL STOCK (Note 11)

  First Preference shares without par value, authorized -
    unlimited; issued and outstanding - Nil
  Common shares without par value, authorized - unlimited;
    issued and outstanding 3,711,400 at
    September 30, 2005 and 2004                                    590,299          590,299

DEFICIT                                                           (748,449)        (776,941)
                                                               -----------      -----------

                                                                  (158,150)        (186,642)
                                                               -----------      -----------

                                                               $ 1,537,169      $ 1,096,554
                                                               ===========      ===========
</TABLE>

On Behalf of the Board:

/s/ Michael Green
-----------------
    Director

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

                                      F-4
<PAGE>
                                MIAD SYSTEMS LTD.

                               STATEMENT OF INCOME
                 FOR THE YEARS ENDED SEPTEMBER 30, 2005 AND 2004
                   (ALL AMOUNTS EXPRESSED IN CANADIAN DOLLARS)

                                                      2005             2004
                                                   -----------     -----------
SALES
    Hardware and software                          $ 8,297,008     $ 6,862,606
    Website design and service                          24,075         122,384
                                                   -----------     -----------

                                                     8,321,083       6,984,990
                                                   -----------     -----------
COST OF SALES
    Hardware and software                            6,912,348       5,939,676
    Website design and service                           4,761          81,770
                                                   -----------     -----------

                                                     6,917,109       6,021,446
                                                   -----------     -----------

GROSS MARGIN                                         1,403,974         963,544
                                                   -----------     -----------
OPERATING EXPENSES
    Wages and benefits                                 833,592         791,836
    Salesmen's auto, travel and promotion              143,288         123,034
    Rent                                                83,341          85,609
    Professional fees                                   61,025          26,882
    Office and general                                  28,511          37,642
    Interest                                            24,442          25,770
    Telephone                                           20,322          32,502
    Bank charges                                        20,007          24,489
    Advertising                                         11,970           6,769
    Insurance                                           11,503           4,989
    Utilities                                           10,636          10,934
    Other expenses (Note 10)                            85,000              --
    Depreciation                                        41,845          44,764
                                                   -----------     -----------

                                                     1,375,482       1,215,220
                                                   -----------     -----------

NET INCOME (LOSS) FOR THE YEAR                     $    28,492     $  (251,676)
                                                   ===========     ===========

NET EARNINGS (LOSS) PER COMMON SHARE (Note 16)
    Basic and fully diluted                        $      0.01     $     (0.07)

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
    Basic and fully diluted                          3,711,400       3,711,400

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

                                      F-5
<PAGE>

                                MIAD SYSTEMS LTD.

                        STATEMENT OF SHAREHOLDERS' EQUITY
                 FOR THE YEARS ENDED SEPTEMBER 30, 2005 AND 2004
                   (ALL AMOUNTS EXPRESSED IN CANADIAN DOLLARS)
<TABLE>
<CAPTION>
                                                  Common Shares
                                             -----------------------
                                               Shares        Amount       Deficit         Total
                                             ---------     ---------     ---------      ---------
<S>                                          <C>           <C>           <C>            <C>
Balances September 30, 2002                  3,711,400     $ 590,299     $(554,511)     $  35,788
    Net income (loss) for the year ended
    September 30, 2003                              --            --        29,246         29,246
                                             ---------     ---------     ---------      ---------

Balances September 30, 2003                  3,711,400       590,299      (525,265)        65,034
    Net income (loss) for the year ended
    September 30, 2004                              --            --      (251,676)      (251,676)
                                             ---------     ---------     ---------      ---------

Balances September 30, 2004                  3,711,400       590,299      (776,941)      (186,642)
    Net income (loss) for the year ended
    September 30, 2005                              --            --        28,492         28,492
                                             ---------     ---------     ---------      ---------

Balances September 30, 2005                  3,711,400     $ 590,299     $(748,449)     $(158,150)
                                             =========     =========     =========      =========
</TABLE>

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

                                      F-6
<PAGE>

                                MIAD SYSTEMS LTD.

                             STATEMENT OF CASH FLOWS
                 FOR THE YEARS ENDED SEPTEMBER 30, 2005 AND 2004
                   (ALL AMOUNTS EXPRESSED IN CANADIAN DOLLARS)
<TABLE>
<CAPTION>
                                                           2005           2004
                                                        ---------      ---------
<S>                                                     <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES
    Net income (loss) for the year                      $  28,492      $(251,676)
    Adjustments to reconcile net income to net cash
     used in operating activities
        Depreciation                                       41,845         44,764
        Cash effect of changes in:
           Accounts receivable                           (319,156)       810,103
           Inventory                                     (131,041)        57,837
           Prepaid expenses                               (12,351)        15,029
           Accounts payable and accrued charges           462,123       (863,412)
                                                        ---------      ---------

                                                           69,912       (187,355)
                                                        ---------      ---------
CASH FLOWS FROM FINANCING ACTIVITIES
    Loan from (to) related parties                       (105,495)       190,000
                                                        ---------      ---------

                                                         (105,495)       190,000
                                                        ---------      ---------
CASH FLOWS FROM INVESTING ACTIVITIES
    Purchases of capital assets                            (4,147)       (24,524)
                                                        ---------      ---------

DECREASE IN CASH                                          (39,730)       (21,879)

CASH, BEGINNING OF YEAR                                    71,361         93,240
                                                        ---------      ---------

CASH, END OF YEAR                                       $  31,631      $  71,361
                                                        =========      =========

SUPPLEMENTAL CASH FLOW INFORMATION:

    Interest paid in cash during the period             $  24,442      $  25,770
</TABLE>

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

                                      F-7
<PAGE>

                                MIAD SYSTEMS LTD.

                        NOTES TO THE FINANCIAL STATEMENTS
                     YEARS ENDED SEPTEMBER 30, 2005 AND 2004
                   (ALL AMOUNTS EXPRESSED IN CANADIAN DOLLARS)

1.  DESCRIPTION OF BUSINESS
--------------------------------------------------------------------------------

    MIAD Systems Ltd. (the "Company") was incorporated in 1993 under the laws of
    the Province of Ontario and is primarily engaged in computer assembly,
    distribution and integration, computer warranty and maintenance service and
    e-business consulting. The reporting currency is Canadian dollars unless
    otherwise noted.

2.  GOING CONCERN
--------------------------------------------------------------------------------

    These financial statements have been prepared on a going concern basis,
    which assume that the Company will continue in operation for the foreseeable
    future and accordingly will be able to realize its assets and discharge its
    liabilities in the normal course of operations. During the year ended
    September 30, 2005, the Company had a working capital deficiency of $321,107
    (2004 - $387,297). The Company's ability to continue as a going concern is
    dependant on the achievement of profitable operations and the continued
    support of its creditors. In the ensuing year, the Company intends to
    increase its sales efforts and reduce operating expenses. There can be no
    assurance that the Company will be successful in increasing revenues,
    decreasing expenses or raising additional investment capital to generate
    sufficient cash flows to continue as a going concern.

3.  SIGNIFICANT ACCOUNTING POLICIES
--------------------------------------------------------------------------------

    Basis of Accounting

         These financial statements have been prepared in accordance with
         Canadian generally accepted accounting principles ("GAAP"), which do
         not materially differ from accounting principles generally accepted in
         the United States ("US GAAP") except as described in Note 18.

    Capital Assets and Depreciation

         Capital assets are recorded at cost less accumulated depreciation.
         Depreciation is provided at rates intended to write off the assets over
         their estimated productive lives as follows:

                           Office equipment      - 10-20% diminishing balance
                           Computer equipment    - 20% diminishing balance
                           Computer software     - straight-line over 60 months

    Cash and Cash Equivalents

         Cash and cash equivalents include all highly liquid investments with an
         original maturity of three months or less. The Company periodically
         maintains cash balances in financial institutions in excess of C.D.I.C.
         insured limits.

    Fair Value of Financial Instruments

         Cash and cash equivalents, accounts receivables, and accounts payable
         and accrued charges are reflected in the financial statements at fair
         value due to the short term maturity of those instruments.

                                      F-8
<PAGE>

                                MIAD SYSTEMS LTD.

                        NOTES TO THE FINANCIAL STATEMENTS
                     YEARS ENDED SEPTEMBER 30, 2005 AND 2004
                   (ALL AMOUNTS EXPRESSED IN CANADIAN DOLLARS)

3.  SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
--------------------------------------------------------------------------------

    Foreign Currency Translation

         Revenue and expense items denominated in foreign currencies are
         translated into Canadian dollars at the rates of exchange prevailing
         during the period. Monetary assets and liabilities denominated in
         foreign currencies are translated at the period-end exchange rates.
         Non-monetary assets and liabilities are translated at rates of exchange
         in effect when the assets are acquired or obligations incurred. Foreign
         exchange gains and losses are reflected in net income for the period.

    Income taxes

         The asset and liability method is used for determining income taxes.
         Under this method, future tax assets and liabilities are recognized at
         the estimated tax recoverable or payable which would arise if assets
         and liabilities were recovered and settled at the financial statement
         carrying amounts. Future tax assets and liabilities are measured using
         enacted tax rates expected to apply to taxable income in the years in
         which the temporary differences are expected to be recovered or
         settled. Changes to these balances are recognized in income in the
         period in which they occur. A valuation allowance is provided to offset
         deferred tax assets if, based upon the available evidence, it is more
         likely than not that some or all of the deferred tax assets will not be
         realized.

    Inventories

         Inventories are valued at the lower of cost or net realizable value,
         with cost being determined on an average cost basis.

    Net Earnings (Loss) per Common Share

         Basic net earnings (loss) per share is computed by dividing net
         earnings (loss) available to the common shareholders by the weighted
         average number of common shares outstanding for the period. Diluted net
         earnings (loss) per share is computed by giving effect to all dilutive
         securities convertible into common shares.

    Revenue Recognition

         Revenues from the sales of products are recognized upon shipment and
         when all significant contractual obligations have been satisfied and
         collection is reasonably assured. The Company ships products FOB its
         warehouse and uses common carriers to deliver the goods. Provision is
         made for an estimate of product returns and doubtful accounts and is
         based on historical experience.

         Revenue from the sales of software is recognized at the date of
         shipment to customers. The Company ships software products FOB its
         warehouse and uses common carriers to deliver the goods.

         Revenue from network installations, warranty and repair service and
         e-business consulting are recognized upon the completion of the
         service.

                                      F-9
<PAGE>

                                MIAD SYSTEMS LTD.

                        NOTES TO THE FINANCIAL STATEMENTS
                     YEARS ENDED SEPTEMBER 30, 2005 AND 2004
                   (ALL AMOUNTS EXPRESSED IN CANADIAN DOLLARS)

3.  SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
--------------------------------------------------------------------------------

    Stock-based compensation

         Effective October 1, 2003, the Company adopted the revised
         recommendations of CICA Handbook Section 3870, "Stock-Based
         Compensation and other Stock-Based Payments", which requires that the
         fair value method of accounting be applied to all stock-based
         compensation payments to both employees and non-employees. In
         accordance with the transitional provisions of Section 3870, the
         Company has prospectively applied the fair value method of accounting
         for stock option awards granted and shares issued after October 1,
         2003. Prior to October 1, 2003, no compensation expense was recognized
         for the issuance of stock or stock options, however, pro-forma
         disclosure of net income and net income per share was provided as if
         these awards were accounted for using the fair value method. The
         estimated fair value of the options is measured at the grant date using
         the Black-Scholes valuation model and is amortized to earnings over the
         vesting period on a straight-line basis.

         Consideration received on the exercise of the stock options, together
         with any amount previously recognized in contributed surplus, is
         recorded as an increase to share capital.

    Use of Estimates

         The preparation of financial statements in conformity with accounting
         principles generally accepted in Canada requires the Company's
         management to make estimates 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 years presented. Actual
         results could differ from those estimates.

4.  ALLOWANCE FOR DOUBTFUL ACCOUNTS RECEIVABLE
--------------------------------------------------------------------------------

    The allowance for doubtful accounts receivable reflects the best estimate of
    probable losses inherent in the Company's receivable portfolio determined on
    the basis of historical experience, specific allowances for known troubled
    accounts and other currently available evidence. At September 30, 2005, the
    allowance for doubtful accounts receivable was $2,850 (2004 - $10,000).

5.  CONCENTRATIONS OF CREDIT RISK
--------------------------------------------------------------------------------

    The Company has no significant off-balance sheet concentration of credit
    risk such as foreign exchange contracts, options contracts or other foreign
    currency hedging arrangements. Financial instruments that potentially
    subject the Company to a concentration of credit risk consist primarily of
    accounts receivable. Concentration of credit risk with respect to accounts
    receivable is limited to certain customers to whom the Company makes
    substantial sales. During the fiscal year ended September 30, 2005, three
    customers accounted for 39% of the Company's receivables and no single
    customers accounted for greater than 10% of the Company's sales. During the
    fiscal year ended September 30, 2004, three customers accounted for 37% of
    the Company's receivables and no single customer accounted for 10% of the
    Company's sales . The Company regularly monitors the creditworthiness of its
    customers and believes that it has adequately provided for exposure to
    potential credit losses.

                                      F-10
<PAGE>

                                MIAD SYSTEMS LTD.

                        NOTES TO THE FINANCIAL STATEMENTS
                     YEARS ENDED SEPTEMBER 30, 2005 AND 2004
                   (ALL AMOUNTS EXPRESSED IN CANADIAN DOLLARS)

6.  INVENTORY
--------------------------------------------------------------------------------

    As at September 30, 2005 and 2004, inventory by major classification was as
    follows:

                          2005          2004
                        --------     --------
    Finished goods      $105,415     $ 10,500
    Component parts       64,726       28,600
                        --------     --------
                        $170,141     $ 39,100
                        ========     ========

7.  LOAN RECEIVABLE (PAYABLE) - RELATED PARTY
--------------------------------------------------------------------------------

    As at September 30, 2005, the loan receivable is due from Michael Green
    (President, CEO and a director), is non-interest bearing, unsecured and has
    no fixed terms of repayment. Subsequent to the year-end, this loan was
    repaid.

    As at September 30, 2004, the loan payable was due to a relative of Michael
    Green, non-interest bearing, unsecured and had no fixed terms of repayment.

8.  CAPITAL ASSETS
--------------------------------------------------------------------------------

                                      Accumulated       NET          Net
                             Cost     Depreciation     2005         2004
                           --------   ------------   --------     --------
    Office equipment       $193,074     $101,767     $ 91,307     $105,752
    Computer equipment      101,861       59,611       42,250       48,703
    Computer software        84,000       54,600       29,400       46,200
                           --------     --------     --------     --------
                           $378,935     $215,978     $162,957     $200,655
                           ========     ========     ========     ========

9.  ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
--------------------------------------------------------------------------------

    In 2000, the Company signed General Security Agreements with two of its
    suppliers, Synnex Canada Inc. and Ingram Micro Canada, Inc., granting
    security over all of the assets of the Company ranking after any banking
    security. At September 30, 2005, the two suppliers are owed $1,180,233 and
    $213,988 respectively (2004 - $907,614 and $129,116). The Company purchases
    the majority of its products from these two suppliers and pays interest of
    14% and 18% per annum, respectively, on the outstanding balances. The
    President of the Company has personally guaranteed all debts owing to these
    suppliers.

10. RETURN OF MONIES RESULTING FROM CHAPTER 11 CLAIM
--------------------------------------------------------------------------------

    The Company agreed to repay approximately $85,000 to a former customer,
    360networks, as a result of their chapter 11 case. As at September 30, 2005,
    the Company had paid $50,000 to the United States Bankruptcy Court.

                                      F-11
<PAGE>

                                MIAD SYSTEMS LTD.

                        NOTES TO THE FINANCIAL STATEMENTS
                     YEARS ENDED SEPTEMBER 30, 2005 AND 2004
                   (ALL AMOUNTS EXPRESSED IN CANADIAN DOLLARS)

11. CAPITAL STOCK
--------------------------------------------------------------------------------

    The Company is authorized to issue an unlimited number of shares of common
    stock without par value (which is the common form of incorporation in
    Canada), of which 3,711,400 shares are issued and outstanding as of
    September 30, 2005 and 2004. The holders of common stock are entitled to one
    vote per share held and have the sole right and power to vote on all matters
    on which a vote of shareholders is taken. The holders of the common stock do
    not have any preemptive rights to subscribe for or purchase any shares of
    any class of stock.

    The Company is authorized to issue an unlimited number of first preference
    shares without par value of which none are issued and outstanding. The
    shares may be issued in one or more series with the designation, rights,
    privileges, restrictions and conditions to be fixed by the board by articles
    of amendment to the certificate of incorporation which must be approved by
    special resolution of the shareholders.

12. STOCK BASED COMPENSATION
--------------------------------------------------------------------------------

    The Company stock option plan authorizes the granting of stock options to
    employees. Under the plan, the exercise price of the option equals the
    market price of the Company's stock on the grant date.

    The following table summarizes information about the stock options
    outstanding as at September 30, 2005 and 2004:
    ----------------------------------------------------------------------------
                          Number of options outstanding and
         Exercise price            exercisable at
              (USD)          September 30, 2005 and 2004           Expiry Date
    ----------------------------------------------------------------------------
              $0.20                    160,000                      June 2006
              $1.75                    40,000                     September 2006
              $0.69                    25,000                     September 2007
    ----------------------------------------------------------------------------
              $0.53                    225,000
    ----------------------------------------------------------------------------

    No options were granted, exercised or cancelled in 2005 or 2004.

13. RELATED PARTY TRANSACTIONS
--------------------------------------------------------------------------------

    Transactions with related parties were incurred in the normal course of
    business and, unless noted otherwise, were measured at the exchange amount,
    which is the amount of consideration established and agreed to by the
    related parties.

    A director is employed by the Company under a service contract and was paid
    $150,000 (2004 - $100,00).

14. CONTINGENT LIABILITIES
--------------------------------------------------------------------------------

    In 2003, a former employee commenced a lawsuit for wrongful dismissal and
    breach of contract. The Company filed a statement of defence and a
    counter-suit. The final outcome of this matter is uncertain but management
    believes that any effect would not be material to the Company's financial
    position as the plaintiff passed away during the year. Accordingly, no
    provision has been recorded in the accounts of the Company.

                                      F-12
<PAGE>

                                MIAD SYSTEMS LTD.

                        NOTES TO THE FINANCIAL STATEMENTS
                     YEARS ENDED SEPTEMBER 30, 2005 AND 2004
                   (ALL AMOUNTS EXPRESSED IN CANADIAN DOLLARS)

15. LEASE OBLIGATIONS
--------------------------------------------------------------------------------

    The Company is committed under operating leases for business premises for
    approximately $319,200. The lease will expire November 30, 2010.

    Approximate annual minimum payments are as follows for fiscal years ending:

                      2006                   $ 59,850
                      2007                     59,850
                      2008                     61,928
                      2009                     62,344
                      2010                     64,422
                      2011                     10,806
                                             --------
                                             $319,200
                                             ========

16. EARNINGS (LOSS) PER SHARE
--------------------------------------------------------------------------------

    Net earnings (loss) per share is calculated using the weighted average
    number of common shares outstanding during the period, which was 3,711,400
    (2004 - 3,711,400). The inclusion of the Company's stock options in the
    computation of diluted earnings (loss) per share would have an anti-dilutive
    effect on earnings (loss) per share. Consequently, there is no difference
    between basic and diluted earnings (loss) per share.

17. INCOME TAXES
--------------------------------------------------------------------------------

    The effective tax rate of nil (2004 - nil) for income taxes varies from the
    statutory income tax rate of 36% (2004 - 36%) due to the fact that losses
    carried forward were applied against current taxable income for resulting
    taxes payable of nil (2004 - losses were incurred, no tax payable).

    The Company has losses for income tax purposes of $686,000 which are
    available to reduce taxable income in future periods. The potential future
    benefit of these amounts has not been recorded as it cannot be considered
    more likely than not that they will be utilized to reduce future taxable
    income. The benefit will be recorded when realized.

    Losses for tax purposes expire as follows:

                      2006                   $ 33,000
                      2007                    123,000
                      2008                    174,000
                      2014                    356,000
                                             --------
                                             $686,000
                                             ========

    Deferred tax assets (liabilities) at September 30, 2005 are as follows:

         Available Non-capital losses        $ 247,000
         Excess tax depreciation                11,000
         Less: Valuation allowance            (258,000)
                                             ---------
         Net deferred tax assets             $      --
                                             =========

                                      F-13
<PAGE>

                                MIAD SYSTEMS LTD.

                        NOTES TO THE FINANCIAL STATEMENTS
                     YEARS ENDED SEPTEMBER 30, 2005 AND 2004
                   (ALL AMOUNTS EXPRESSED IN CANADIAN DOLLARS)

18. SIGNIFICANT DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GAAP
--------------------------------------------------------------------------------

    The Company's financial statements were prepared using Canadian GAAP, which
    differs in some respects from US GAAP. There are no material differences
    between Canadian GAAP and US GAAP in the balance sheets of the Company as at
    September 30, 2005 and 2004, and the statements of income, shareholders'
    equity and cash flows for the years then ended. The following additional
    disclosures are made for US GAAP disclosure requirements.

    (I)   STOCK BASED COMPENSATION

    As more fully described in note 2, the Company has prospectively adopted the
    new Canadian GAAP recommendations, which require that a fair value method of
    accounting be applied to all stock-based compensation awards to both
    employees and non-employees granted on or after October 1, 2003. The
    Canadian GAAP recommendations are substantially harmonized with US GAAP
    rules. Therefore, there is no GAAP difference for stock-based compensation
    and awards in fiscal 2005 or 2004.

    (II)  FREIGHT COSTS

    Freight costs incurred for delivering goods to customers are included in
    cost of goods sold and amounted to $53,500 and $50,600 in 2005 and 2004,
    respectively. The Company generated $23,000 and $25,800 of freight revenues
    recharged to customers in 2005 and 2004, respectively, and these amounts are
    included in sales.

    (III) STATEMENT OF COMPREHENSIVE INCOME

    In Accordance with SFAS No. 130, "Reporting Comprehensive Income", the
    Company is required to report its comprehensive income. Other comprehensive
    income refers to revenue, expenses, and gains and losses that under US GAAP
    are included in comprehensive income but are excluded from net income, as
    these amounts are recorded directly as an adjustment to shareholders'
    equity. A statement of comprehensive income has not been prepared as the
    Company has no items of the comprehensive income. Comprehensive income is
    the same as net income for the years presented herein.

    (IV)  LITIGATION

    From time to time the Company is exposed to claims and legal actions in the
    normal course of business, some of which are initiated by the Company.
    Management believes that the settlement or resolution of such actions, if
    any, will not have a material effect on the financial position or results of
    operations of the Company.

    (V)   RECENT ACCOUNTING PRONOUNCEMENTS

    In November 2004, the Financial Accounting Standards Board (FASB) released
    revised FASB Statement No. 151 (FAS 151), "Inventory Costs - an amendment of
    ARB No. 43". The new standard requires amounts of idle facility expense,
    freight, handling costs, and wasted material (spoilage) to be recognized as
    current-period charges. It also requires that allocation of fixed production
    overheads to the costs of conversion be based on the normal capacity of the
    production facilities. The requirements of the standard will be effective
    for inventory costs incurred during fiscal years beginning after June 15,
    2005. Company does not expect that adoption of FAS 151 will have a material
    impact on its results from operations or financial position.

                                      F-14
<PAGE>

                                MIAD SYSTEMS LTD.

                        NOTES TO THE FINANCIAL STATEMENTS
                     YEARS ENDED SEPTEMBER 30, 2005 AND 2004
                   (ALL AMOUNTS EXPRESSED IN CANADIAN DOLLARS)

18. SIGNIFICANT DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GAAP (CONTINUED)
--------------------------------------------------------------------------------

    (V)   RECENT ACCOUNTING PRONOUNCEMENTS (CONTINUED)

    In December 2004, the FASB issued Statement No. 123 (Revised 2004),
    "Share-Based Payment" ("Statement 123(R)"), which is a revision of FASB
    Statement No. 123, "Accounting for Stock-Based Compensation" ("Statement
    123"). Statement 123(R) supersedes APB Opinion No. 25, "Accounting for Stock
    Issued to Employees" and amends FASB Statement No. 95, "Statement of Cash
    Flows". Generally, the approach in Statement 123(R) is similar to the
    approach described in Statement 123. However, Statement 123(R) requires all
    share-based payments to employees, including grants of employee stock
    options, to be recognized in the income statement based on their fair
    values. Pro forma disclosure is no longer an alternative. Effective November
    1, 2003, the Company adopted the fair value accounting method provided for
    under the Statement. Statement 123(R) will have no impact on the financial
    statements of the Company.

    In December 2004, the FASB issued Statement No. 153, "Exchanges of
    Non-monetary Assets" ("Statement 153"), an amendment of APB Opinion No. 29,
    "Accounting for Non-monetary Transactions". Statement 153 is based on the
    principle that exchanges of non-monetary assets should be measured based on
    the fair value of the assets exchanged. Statement 153 eliminates the narrow
    exception for non-monetary exchanges of similar productive assets and
    replaces it with a broader exception for exchanges of non-monetary assets
    that do not have commercial substance. Statement 153 is effective for
    non-monetary asset exchanges occurring in fiscal periods beginning after
    June 15, 2005. The provisions of Statement 153 should be applied
    prospectively. The Company does not anticipate that the application of
    Statement 153 will have an impact on the financial statements of the
    Company.

    In May 2005, the FASB issued Statement No.154, "Accounting Changes and Error
    Corrections ("Statement 154"), a replacement of the Accounting Principles
    Board ("APB") Opinion No. 20, "Accounting Changes" and FASB Statement No. 3,
    "Reporting Accounting Changes in Interim Financial Statements." Statement
    154 applies to all voluntary changes in accounting principle and changes the
    requirements for accounting for and reporting a change in accounting
    principle. Statement 154 requires the retrospective application to prior
    periods' financial statements of the direct effect of a voluntary change in
    accounting principle unless it is impracticable. APB No. 20 required that
    most voluntary changes in accounting principle be recognized by including
    the cumulative effect of changing to the new accounting principle in net
    income of the period of the change. Unless adopted early, Statement 154 is
    effective for fiscal years beginning after December 15, 2005. Early adoption
    is permitted for fiscal years beginning after June 1, 2005. Statement 154
    does not change the transition provisions of any existing accounting
    pronouncements, including those that are in a transition phase as of the
    effective date of this statement. The Company does not anticipate that the
    application of Statement 154 will have an impact on the financial statements
    of the Company.

                                      F-15