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


                                   FORM 10-KSB

                       {X} ANNUAL REPORT UNDER SECTION 13
                 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

                For the Fiscal Year Ended September 30, 2006

                     { } TRANSITION REPORT UNDER SECTION 13
                 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

                           Commission File No. 0-27175

                           ADVANCE TECHNOLOGIES, INC.
                 (Name of small business issuer in its charter)

          Nevada                                        95-4755369
(State of other jurisdiction of                     (I.R.S. Employer
 incorporation or organization)                      Identification Number)

               15 N. Longspur Drive, The Woodlands, TX, 77380
                 Issuer's telephone number: (310) 213-2143

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

Securities registered under Section 12(g) of the Exchange Act: Common Stock, no
par value.

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

         Yes {X}   No {  }

Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B 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. {X}

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

State issuer's revenues for its most recent fiscal year.  $  33,815

The aggregate market value of registrant's Common and Preferred Stock held by
non-affiliates, based upon the average bid and asked sales price for September
2006 was $ 1,996,170.

As of September 30, 2006, there were 39,527,897 shares of the registrant's
Common Stock outstanding. On September 30, 2006, there were 27,588,477 shares of
Preferred Stock outstanding.

Transitional Small Business Disclosure Format Yes {X}   No {  }




<PAGE>


INFORMATION REQUIRED IN ANNUAL REPORTS OF TRANSITIONAL SMALL BUSINESS ISSUERS

                                     PART I



ITEM 1.


DESCRIPTION OF BUSINESS


CORPORATION BUSINESS MODEL


Advance Technologies, Inc.'s corporation business model is to develop Infrared
imaging systems for commercial market applications. These markets fall into the
areas of medical, security, and the largest, transportation. The commercial
transportation market consists of air, land, and sea applications. These systems
are designed to provide two basic benefits, operational safety and improved
security. These goals are achieved by utilizing the inherent night vision
capability, our core technology adapted to the specific needs of the market.
Infrared technology is at the heart of these systems. Infrared technology is
based upon advanced research developed for the US military. Infrared technology
has been designated and approved for dual use (military and commercial) by the
United States government.


All Military technology has inherent US Government restrictions. ATI's highest
priority is to ensure we are compliant with restrictions imposed by the US
government. The restrictions and methods of compliance are detailed in the
United States International Traffic on Arms Regulation. The US Department of
Commerce (DOC) is the US over-sight authority for our activities. When
Department of Defense and/or Department of State (co- administrators of the
technology) become involved, their activity is coordinated through our DOC
administrative authority.


Advance Technologies marketing strategy is based upon principles that recognize
both our strengths and our weaknesses. This strategy is embodied in a
well-defined business model. Most of our projects require a strategic partner.
The strategic partner needs to be a leader in the market field of our intended
application. The strategic partner as a general rule provides the marketing,
sales, and after sales support for the system. Our strategy minimizes start-up
and infrastructure cost, our market investment, and the overall risk to ATI. Our
primary role for each project is: (1) to ensure the technology is used properly
in each application, (2) the system engineering necessary to achieve the desired
functional capability is performed, and (3) the end product is compliant with
ITAR. Production for each project is addressed on a case by case basis. The
strategic partner has a key role in establishing the component suppliers, often
preferring to use their own captive sources.


Our business model licenses intellectual property for a specific field and
product to our strategic partner. It is essential that ATI retain core ownership
over the basic technology and intellectual property. Our license agreements are
for applications restricted to the licensed field. By utilizing our intellectual
property in this way, the same technology is licensed to different fields of
application on an exclusive or non- exclusive basis without creating a conflict
between over-lapping markets and license rights.


MAJOR ACTIVITY,

Enhanced Vision System (EVS)

Advance Technologies entered into a licensing agreement with Kollsman Inc. in
1995, which allowed the incorporation of the company's technology and
intellectual property into an Enhanced Vision System for use on the Gulfstream
series of Aircraft. The EVS system entered production in early 2002. Kollsman
has announced a new enhanced vision product in late 2002 for use at the low-end
private aviation market. This product is expected to enjoy the same success as
the Gulfstream product but with a far larger market.







Infrared Security System (ISS)

A provisional patent pending has been obtained for our Infrared Security System.
This protection for our intellectual property rights will allow us to
aggressively engage in discussion with potential partners and customers.
Preliminary discussions have been initiated. These discussions have been well
received and the Board of Directors is evaluating the best way to proceed. The
updated patent was filed November 5, 2006. Our "prior art" study for the full
patent application did not uncover any existing patents that could impinge upon
our patent claims.

OTHER DEVELOPMENT ACTIVITIES

Recreational Vehicles Systems (RVS)


Advanced Technologies signed a licensing agreement with Recreational Vehicle
Systems (RVS), a Nevada Corporation. Under terms of the agreement, we will
provide technical know-how and development support to RVS to develop an Infrared
Imaging System for the license field of Recreational Vehicles. In consideration
for our technical support and certain licensed technical property rights ATI
will receive a royalty on each unit sold. No sales before 2007 or early 2008.
The terms of the agreement specify $300.00 per system sold for a period of ten
years initiated by the first sale. This agreement is non-exclusive with RVS.


Medical Systems


The sale of 50 NVS cameras to United Integrated Services (UIS, a Taiwan
Corporation) under an export license granted by the United States Commerce
Department was completed in 2006. UIS as indicated their desire for an
additional 100 units in 2007 - 2008. The company will need to apply for an
export license. The terms and conditions for our involvement with UIS for
additional sales are in negotiations.





POTENTIAL IMPACT ON FINANCIAL


PERFORMANCE

Advance Technologies, Inc. under the terms of our exclusive license with
Kollsman Inc. is in a position to receive royalties of $22,640,000 over the
initial 10,000 units sold under terms of this contract. The realization of these
revenues is dependent upon Kollsman securing a major share of the Enhanced
Vision Market. Advance Technologies, Inc. may or may not achieve all or part of
this royalty income based upon market performance by Kollsman. The performance
of Kollsman is subject to external and internal factors at Kollsman which are
outside of our ability to either control, affect, or to predict. As Kollsman
progresses in the EVS market through the meeting of key performance and sales
milestones, Advance Technologies will report those achievements as disclosed by
Kollsman or reported in the public media.




EMPLOYEES


Advance Technologies, Inc. has one full time employee, Gary Ball.
















ITEM 2   DESCRIPTION OF PROPERTY.


Advance Technologies, Inc. has re-located to Texas. Suitable offices will be
located in The Woodlands area of North Houston. Until new facilities are
obtained, business will be conducted from a separate office area at 15 N.
Longspur Drive, The Woodlands, TX, 77380.  This place of business is part of
the residence of the President of Advance Technologies. The rent is $ 400.00 per
month.



ITEM 3. LEGAL PROCEEDINGS There have been none.



ITEM 4.  SUBMISSION OF MATTERS TO A VOTE        No actions have been taken.
















































                                            PART II




ITEM 5.


MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY AND OTHER
SHAREHOLDER MATTERS.


Advance Technologies Inc. is traded under the symbol of AVTX on the NASDAQ BB.
The high and low share prices for the last two years
by quarters are:




Quarter        Year      High      Low       Dividends
 ----------    ------    ------    ------    ----------
July-Sept      2006      .02       .02       0
Apr-June       2006      .04       .03       0
Jan-Mar        2006      .06       .03       0
Oct-Dec        2005      .07       .05       0
July-Sept      2005      .07       .05       0
Apr-June       2005      .05       .02       0
Jan-Mar        2005      .04       .03       0
Oct-Dec        2004      .04       .03       0


SHAREHOLDERS OF AVTX


Common Stock, there were 1,015 shareholders listed by Pacific Stock Transfer
Company, our agent of record on September 30, 2006.


Preferred Stock, there were 129 shareholders listed by Pacific Stock Transfer
Company, our agent of record on September 30, 2006.


DIVIDENDS


There have been no dividends paid to shareholders in the last two years.


EQUITY COMPENSATION PLANS


Equity Compensation paid to a company consultant in 2006. The consultant, Robert
Schneider earned 400,000 shares of preferred stock under terms of his consulting
contract.


DESCRIPTION OF EXHIBITS.


See Item 13. of Part III, below.


CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS.


Not applicable.


COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.

The Board of Directors, all Officers, and major shareholders of 10% or more of
Advance Technologies Inc. are in compliance with all reporting requirements of
the exchange act.

OPERATIONS


In 2006 Advance Technologies established our headquarters in Woodland Texas. The
Board of Directors has instructed the CEO to initiate a review of our operations
to ascertain our future needs. Our primary source of future income will be
through our licensing agreements. Our development activities are being conducted
in concert with strategic partners, relying upon their capital resources.


Our development activity has shifted from internal hardware based R&D activity
to external technical marketing with potential partners. This shift has been
created by Infrared Imaging Cameras and Systems moving from high technology to a
commodity or production component. The system applications and embedded
application software represents the majority of future opportunities for Advance
Technologies.


ENVIRONMENTAL IMPACT


Advance Technologies operations do not effect the environment and are fully
compliant to Federal, State, and local laws.































































                      ADVANCE TECHNOLOGIES, INC. AND SUBSIDIARY
                          (A DEVELOPMENT STAGE COMPANY)

ITEM 6.

MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS

The management discussions contain certain forward-looking statements and
information that are based on the beliefs of management as well as assumptions
made by and information currently available to management. When used in this
document, the words "anticipate," "believe," "estimate," "expect," "intend,"
"will," "plan," "should," "seek," and similar expressions, are intended to
identify forward-looking statements. Such statements reflect the current view of
management regarding future events and are subject to certain risks,
uncertainties and assumptions. Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove incorrect,
actual actions or results may vary materially from those described herein as
anticipated, believed, estimated, expected or intended.

The following discussion and analysis should be read in conjunction with the
company's consolidated financial statements and related footnotes for the year
ended September 30, 2006. The discussion of results, causes and trends should
not be construed to imply any conclusion that such results or trends will
necessarily continue in the future.

Results of Operations

EXECUTIVE SUMMARY

(A) Advance Technologies, Inc. has been receiving sales credit from Kollsman
Inc. since 2002. The first 200 units were stipulated as "without royalties". The
next 210 units are subject to royalties, but 63% of the income is applied to an
"Advance Royalty" account. Advance Technologies net royalty income will increase
by virtue of the payment in full of the "advance royalty" account and improving
sales.

(B) The fiscal year for 2006 had an overall increase of 73% in sales over the
fiscal year of 2005. The royalty sales amounted to an increase of +61% for like
fiscal year periods. The EVS royalties reflect sales of the EVS I product by
Kollsman, with the introduction of EVS II in 2007, we expect additional sales in
the Gulfstream retrofit market and with FedEx, Kollsman's newest customer.

The payment in full of the "advanced Royalty" account will be achieved by the
second quarter of 2007 based upon current and projected sales. The initial sales
to the FedEx customer will most likely occur in 2007. By satisfying of the
"Advance Royalty Account", net profit margins will increase by 167% for the same
sales.

Advance Technologies, Inc. provided consultation and export sales to United
Integrated Services Inc., a Taiwan Corporation in 2006. The net income was
$6,215. UIS has indicated their desire to purchase an additional 100 Cameras in
2007. UIS has asked Advance Technologies to apply for an export license for
these future sales. A contract with UIS is in negotiations.

Advance Technologies, Inc. is pursuing a new product (Infrared Security System).
The funds for this new venture will be obtained from investment sources without
liability to Advance Technologies Inc. Therefore, no incurred expense or set
aside provisions for future expense has been made.


(c) There are no off-balance sheet arrangements.


<Page>





MAJOR ACTIVITY

Highlights of Fiscal Year 2006

The Enhanced Vision System project continues with on going sales by Kollsman to
Gulfstream. These sales closely track the new aircraft deliveries by Gulfstream.
The retrofit market for Gulfstream continues at a slow rate, but is projected to
improve once the EVS II is certified and in production.

The introduction of EVS II for FedEx has slipped schedule, with certification
now anticipated in the first quarter of FY 2007. When EVS II is placed in
production for FedEx it is expected that the Gulfstream retro-fit program for
older models of their G series aircraft, which will use the new EVS II will
increase.

Recreational Vehicle Systems Inc. has completed their incorporation filing, and
they have stated they intend to initiate operations in 2007. RVS has encountered
delays of an unknown origin. The License Agreement requires sales within a 3
year period to retain their exclusivity.

I-6 ACTIVITIES

ATI formed a subsidiary company to pursue the Infrared Security System (ISS)
opportunity 2nd quarter of 2006. This wholly owned, Infrared Systems
International (ISIX or I-6) has been licensed by ATI for the intellectual
property pertaining to ISS. The ISS project requires a major effort that
encompasses advance technology in the areas of Infrared, Image Processing,
Wireless conductivity, Advanced Server Design, and Security Response Providers.

I-6 has been engaged in discussions with several corporations. These discussions
cover a broad range of topics. The key subjects are: investments, equity
considerations, technical responsibilities, and project role. The market focus
has been for applications to the small to medium size commercial wholesalers,
manufacturers, and distributors. This market segment has been projected to
exceed 1/2 million units in the first five years from start up. The launching of
an effort of this magnitude will be our focus for 2007.

I-6 has secured the cooperation of several strategy partners for the development
of ISS. These corporations are experts in their core technologies: Wireless
mobile transport, Specialized Wireless Server Design, Software design and
coding, IR Cameras, Internet protocol, and OEM high rate production. These
organizations currently participate under binding non-disclosure agreements.
There are no commitments from I-6 for their involvement beyond this early
technical assessment phase. When future agreements that bind I-6 to any
corporation are executed, the nature of the agreement and the participating
party or parties will be announced within proprietary and competition sensitive
limits.

     (c) There are no off-balance sheet arrangements.

ATI continues to utilize the services of an SEC Attorney on retainer, and
contract for bookkeeping services on a time and material basis. This has
substantially added to our cost of ensuring that we are and remain fully
complaint to all SEC regulations.















YEAR ENDED SEPTEMBER 30, 2006 COMPARED WITH THE PRIOR YEAR ENDED SEPTEMBER 30,
2005.


NET SALES

Net sales for the company were approximately $33,815 for the 12 month period
ending on September 30, 2006 as compared to approximately $19,553 for the same
period a year earlier. Consulting fees increased from $2,453 to $6,215 for the
same 12 month periods of time. The sales rate for EVS continues to increase at a
modest rate.

GROSS PROFIT

GROSS PROFIT was the same as NET PROFIT since royalty income and consulting fees
have NO COST OF GOODS, the gross and net profits are the same.


SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

Operating expense for the twelve month period ending September 30, 2006 was
$84,212 as compared to $57,961 for the same twelve month period ending September
30, 2005. The increase in operating cost can be attributed to increased costs
associated with Sarbanes-Oxley (approximately $7,618) and $6,000 per quarter for
the President/CEO and $2,000 per quarter for the Board of Directors (two members
plus the President).

OTHER INCOME AND EXPENSE

For the twelve month period this year (2006) the expense was $11,879 versus
$8,764 last year in 2005. The increase in expense was for interest on loans and
account payables.

NET PROFIT (LOSS) BEFORE PROVISIONS FOR INCOME TAXES

The net loss for the twelve month period ending September 30, 2006 was $66,276
versus $47,172 for the same period in 2005. The largest factor in the increased
loss results from the inclusion of the President and BOD compensation $24,479
for the year. The compensation is in the form of preferred shares.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

The operating expense for the twelve month period ending September 30, 2006 was
$84,212 versus $57,961 in the same period of 2005. The principle cause of the
increase in operating cost is the introduction of the Compensation Plan in fall
of 2005 for the President & Board of Directors. The plan provides the equivalent
of $8,000 per quarter of Preferred Shares. The compensation plan has been
terminated as of September 30, 2006. Alternative ways to provide fair
compensation will be investigated.


OTHER INCOME AND EXPENSE

For the twelve month period ending September 30, 2006 the interest expense was $
11,879 versus $ 8,764 for the like period in 2005.

NET PROFIT (LOSS) BEFORE PROVISON FOR INCOME TAXES

The net loss for the twelve month period ending September 30, 2006 was $62,276
versus $47,172 for the like period in 2005. The President and Board of Directors
compensation accounted for $24,479 of expense for 12 months, compared to $0 in
2005, prior to the introduction of the plan.







LIQUIDITY AND CAPITAL RESOURCES

The company's primary source of revenues is from royalties from our EVS licensee
Kollsman. Our Royalties reported as revenues are net royalties with the gross
revenue at 2.27 times the reported royalties. The reduction to net royalties is
caused by the repayment of advance royalties as specified in the Kollsman
License Agreement. Based upon current sales, the advance royalties will be fully
paid (currently 71% has been paid) by the second quarter of 2007. This will
cause our net income to increase by a factor of 1.67 for each sale.

The other source of income comes from our Agent agreement with United Integrated
Service Co. LTD, Taiwan. The collaboration with UIS has allowed our company to
be coupled into the Far East market. This Agent relationship in 2007 will add
between 10-12 thousand dollars to our net earnings annually, and continue to
foster an important professional relationship with UIS.

The company has formed a wholly owned subsidiary called I-6. The Infrared
Security System has been licensed to I-6. Under terms of the license I-6 has
issued a promissory note to the company for $100,000. This note when collected
will defer internal expenses, the most notable being for a patent attorney to
complete the ISS patent filed last November 6, 2005 and organization costs for
I-6.

The Board of Directors has offered I-6 a twenty-four month buy-back option for
the ISS intellectual property. The option is for $100,000,000. The option offer
has been received and approved by I-6 and its Board of Directors. The option
will provide protection to the shareholders against a hostile take over of ATI.

The company income has not been sufficient for meeting our expenses; as a result
our short term debt has increased. The expenditure with the Patent Attorney for
ISS has been the largest cost. The fee, $12,000 plus filing and miscellaneous
expenses has been accrued, with 50% paid before submittal of the patent, and the
balance due in 2007. The fee scheduling was provided by the Patent Attorney to
fit our budget allocations.

I-6 expects to receive all investment funds from ISS Associate Contractors for
certain considerations, but limited to the ISS project. The company stands to
benefit through the success of I-6, but is structured to be insulated from any
liability. And with the "Hostile take over provisions", the company is
adequately protected against any attempt to abridge our patent rights.
Investments incurred by I-6 will be separately recorded, but will be included as
part of Advance Technologies Inc. for the immediate future.


OPERATIONS

The Company operated at a substantial loss over the last twelve months
($62,276). This loss is directly attributed to the Executive compensation
package of $24,479. Since the compensation is in the form of preferred shares,
the impact on cash flow and cash reserves is minimized. Since the preferred
shares do not enter the market "float" and the shares represent less than 0.7%
of the combined preferred and common share base, the compensation package has
minimum impact on the Company.

The Sarbanes-Oxley Act has added substantially to our direct cost. We estimate
that our cost of meeting the new standards is between 12-15 thousand dollars,
and is increasing on a yearly basis.


INVESTING

The Company's only investment during this period was for the ISS patent,
provisional in 2005, and full patent in 2006 & 2007. The fiscal expenditure in
2006 was $16,753, and an accrued expenditure of an additional $6,000 for 2007.




FINANCING

The company believes that no additional financing will be required, and present
interim financing will meet all of our short term needs as required until
royalties will cover all of our expenses. Additional funding if required for I-6
will be secured using I-6 collateral as the sole security for any such
obligation. This insulates Advance Technologies Inc and their shareholders from
any debt or obligation that is incurred by I-6 in pursuit of the Infrared
Security Market.





























































                                     PART I
                              Financial Information


ITEM 7.  FINANCIAL STATEMENTS
         -------------------
<PAGE>
                 ADVANCE TECHNOLOGIES, INC. AND SUBSIDIARY

                         SEPTEMBER 30, 2006 CONSOLIDATED
                              FINANCIAL STATEMENTS


























































<PAGE>
                 ADVANCE TECHNOLOGIES, INC. AND SUBSIDIARY

                                TABLE OF CONTENTS

                                                                    PAGE
                                                                  --------

Report of Independent Registered Public Accounting Firm               1

Report of Independent Registered Public Accounting Firm (restated)    2

Consolidated Balance Sheet, September 30, 2006                        3

Consolidated Statements of Operations, For the Years Ended
September 30, 2006 and 2005                                           4

Consolidated Statements of Stockholders' Deficit, For the
Years Ended September 30, 2006 and 2005                               5

Consolidated Statements of Cash Flows, For the Years Ended
September 30, 2006 and 2005                                           6

Notes to the Consolidated Financial Statements                     7 - 12

<PAGE>
              Report of Independent Registered Public Accounting Firm

To the Board of Directors
Advance Technologies, Inc. and Subsidiary

We have audited the consolidated balance sheets of Advance Technologies, Inc.
and Subsidiary (the Company) as of September 30, 2006, and the related
consolidated statements of operations, stockholders' equity and cash flows for
the year ended September 30, 2006. These consolidated financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audits to obtain reasonable assurance about whether the
financial statements are free of material misstatement. The company is not
required to have, nor were we engaged to perform, an audit of its internal
control over financial reporting. Our audit included consideration of internal
control over financial reporting as a basis for designing audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the company's internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated financial position of Advance
Technologies, Inc. and Subsidiary as of September 30, 2006, and the consolidated
results of its operations and its cash flows for the year ended September 30,
2006, in conformity with accounting principles generally accepted in the United
States of America.

The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. As discussed in Note 3 to the consolidated
financial statements, the Company is dependent on financing to continue
operations. This raises substantial doubt about its ability to continue as a
going concern. Managements plans to resolve this uncertainty is also discussed
in Note 3. The consolidated financial statements do not include any adjustments
that might result form the outcome of this uncertainty.

/s/ Child, Van Wagoner & Bradshaw, PLLC

Child, Van Wagoner & Bradshaw, PLLC
January 12, 2007
Salt Lake City, Utah


<PAGE>



             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders
Of Advance Technologies, Inc.
(A Development Stage Company)

We have audited the accompanying consolidated balance sheers of Advance
Technologies, Inc. (a development stage company) as of September 30, 2005 and
2004 and the related consolidated statements of operations and cash flows for
the years then ended and from the period October 1, 1985 (date of inception)
through September 30, 2005. These consolidated financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with standards of the PCAOB (United
States). Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the consolidated financial statements are
free of material misstatement. The Company has determined that it is not
required to have, nor were we engaged to perform, an audit of its internal
control over financial reporting. Our audit included consideration of internal
control over financial reporting as a basis for designing audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company's internal control over financial
reporting. Accordingly, we express no such opinion. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in the
consolidated financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.

In our overall opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Advance
Technologies, Inc. (a development stage company) as of September 30, 2005 and
2004 and the results of its operations and cash flows for the years then ended
and from the period October 1, 1985 (date of inception) through September 30,
2005 in conformity with U.S. generally accepted accounting principles.

The accompanying consolidated financial statements have been prepared assuming
the company will continue as a going concern. As discussed in Note 3 to the
consolidated financial statements, the Company is dependent on financing to
continue operations. This raises substantial doubt about its ability to continue
as a going concern. Managements plans to resolve this uncertainty is also
discussed in Note 3. The consolidated financial statements do not include any
adjustments that might result from the outcome of this uncertainty.

As discussed in Note 2 to the consolidated financial statements, there were
errors in reporting the Company's revenues, discounts on revenue, compensation
to officers, accrued credit card liabilities and imputed interest on officer
loans. Accordingly, the consolidated financial statements have been restated to
correct the errors.

/s/ Chisolm, Bierwolf & Nilson
Chisolm, Bierwolf & Nilson
Bountiful, Utah
December 30, 2005 except for notes 2 and 8 dated January 11, 2007



<PAGE>

































<PAGE>













                       ADVANCE TECHNOLOGIES, INC. AND SUBSIDIARY
                        CONSOLIDATED BALANCE SHEET
<Table>
<Caption>

                                   ASSETS
                                   ------
                                                              September 30,
                                                                       2006
                                                              -------------
<S>                                                           <C>

CURRENT ASSETS:
 Cash                                                         $       4,200
 Accounts receivable                                                  5,700
 Prepaid expenses                                                        72
                                                              -------------
   Total Current Assets                                               9,972

PROPERTY AND EQUIPMENT, net                                             720

DEFINITE-LIFE INTANGIBLE ASSETS                                       3,000
                                                              -------------
   TOTAL ASSETS                                               $      13,692
                                                              =============




                   LIABILITIES AND STOCKHOLDERS' DEFICIT
                    ------------------------------------
CURRENT LIABILITIES:
 Accounts payable                                             $      30,457
 Related party loans                                                 77,750
                                                              -------------
   Total Current Liabilities                                        108,207

STOCKHOLDERS' DEFICIT:
 Series A convertible preferred stock, $.001 par value, 100,000,000 shares
  authorized, 27,588,477 shares issued and outstanding 27,588
 Common stock, $.001 par value, 100,000,000 shares
  authorized, 39,527,897 shares issued and outstanding               39,528
 Capital in excess of par value                                     639,153
 Retained earnings (deficit)                                       (800,784)
                                                              -------------
   Total Stockholders' Deficit                                      (94,515)
                                                              -------------
   TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT                $      13,692
                                                              =============


</Table>
              See accompanying notes and accountants' report.
                                     Page 5
<PAGE>













                 ADVANCE TECHNOLOGIES, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF OPERATIONS

<Table>
<Caption>

                                                    For the Year Ended
                                                       September 30,
                                               ----------------------------
                                                   2006           2005
                                               -------------  -------------
                                                                (Restated)
<S>                                            <C>            <C>
REVENUES:
 Royalty                                       $      27,600  $      17,100
 Consulting                                            6,215          2,453
                                               -------------  -------------
   Total Revenues                                     33,815         19,553
                                               -------------  -------------
OPERATING EXPENSES:
 Compensation                                         24,479              -
 Consulting                                           12,550              -
 Professional fees                                    18,515         10,897
 Other general and administrative                     28,668         47,064
                                               -------------  -------------
   Total Operating Expenses                           84,212         57,961
                                               -------------  -------------
LOSS BEFORE OTHER INCOME (EXPENSE)                   (50,397)       (38,408)
                                               -------------  -------------
OTHER INCOME (EXPENSE):
 Interest expense                                     (5,849)        (3,552)
 Interest expense - related party                     (6,030)        (5,212)
                                               -------------  -------------
   Total Other Income (Expense)                      (11,879)        (8,764)
                                               -------------  -------------

LOSS BEFORE INCOME TAXES                             (62,276)       (47,172)

INCOME TAX EXPENSE                                         -              -
                                               -------------  -------------
NET LOSS                                       $     (62,276) $     (47,172)
                                               =============  =============

LOSS PER COMMON SHARE                          $       (0.00) $       (0.00)
                                               =============  =============
WEIGHTED-AVERAGE SHARES OUTSTANDING               39,511,961     35,255,995
                                               =============  =============
</Table>
              See accompanying notes and accountants' report.
                                     Page 6
<PAGE>
















                 ADVANCE TECHNOLOGIES, INC. AND SUBSIDIARY
              CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT
              FOR THE YEARS ENDED SEPTEMBER 30, 2006 AND 2005

<Table>
<Caption>

                 Preferred Stock         Common Stock     Capital in  Retained
               --------------------  --------------------  Excess of  Earnings
                 Shares     Amount     Shares     Amount   Par Value  (Deficit)
               ----------  --------  ----------  --------  --------  ----------
<S>            <C>         <C>       <C>         <C>       <C>       <C>
BALANCE,
 September 30,
 2004, as
 previously
 reported      37,195,958  $ 37,196  28,319,416  $ 28,319  $550,889  $ (672,252)

Cumulative
 effect of
 correction of
 errors                 -         -           -         -    19,084     (19,084)
               ----------  --------  ----------  --------  --------  ----------
BALANCE,
 September 30,
 2004, as
 restated      37,195,958    37,196  28,319,416    28,319   569,973    (691,336)

Preferred stock
 converted into
 common stock (11,178,801)  (11,179) 11,178,801    11,179         -           -

Capital
 contribution           -         -           -         -     7,500           -

Imputed related
 party interest         -         -           -         -     5,212           -

Net loss for
 the year ended
 September 30,
 2005 (Restated)        -         -           -         -         -     (47,172)
               ----------  --------  ----------  --------  --------  ----------
BALANCE,
 September 30,
 2005          26,017,157    26,017  39,498,217    39,498   582,685    (738,508)

Issued stock to
 pay liability
 of $8,000,
 October 2005     160,000       160           -         -     7,840           -

Issued stock for
 services valued
 at $11,000,
 December 2005    200,000       200           -         -    10,800           -

Issued stock for
 services valued
 at $3,900,
 February 2006    100,000       100           -         -     3,800           -

Issued stock for
 services valued
 at $29,139,
 March, April,
 June, and
 September 2006 1,141,000     1,141           -         -    27,998           -

Preferred stock
 converted into
 common stock,
 April and May
 2006             (29,680)      (30)     29,680        30         -           -

Imputed related
 party interest         -         -           -         -     6,030           -

Net loss for
 the year ended
 September 30,
 2006                   -         -           -         -         -     (62,276)
               ----------  --------  ----------  --------  --------  ----------
BALANCE,
 September 30,
 2006          27,588,477  $ 27,588  39,527,897  $ 39,528  $639,153  $ (800,784)
               ==========  ========  ==========  ========  ========  ==========
</Table>
              See accompanying notes and accountants' report.
                                     Page 8
<PAGE>















































                 ADVANCE TECHNOLOGIES, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

<Table>
<Caption>

                                                    For the Year Ended
                                                       September 30,
                                               ----------------------------
                                                   2006           2005
                                               -------------  -------------
                                                                 (Restated)
<S>                                            <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net loss                                      $     (62,276) $     (47,172)
 Adjustments to reconcile net loss to net cash
 used by operating activities:
   Depreciation & amortization                           884          5,711
   Imputed interest                                    6,030          5,212
   Stock issued for services                          44,039              -
  (Increase) decrease in accounts receivable             900         (6,600)
  (Increase) in prepaid expenses                         (72)             -
  Increase in accounts payable                         8,764         16,810
  Increase in liabilities to be settled by
  stock issuance                                           -          8,000
                                               -------------  -------------
NET CASH USED BY OPERATING ACTIVITIES                 (1,731)       (18,039)

CASH FLOWS FROM INVESTING ACTIVITIES:
 Purchase of property and equipment                     (753)             -
 Payments for definite-life intangible assets         (3,000)             -
                                               -------------  -------------
NET CASH USED BY INVESTING ACTIVITIES                 (3,753)             -

CASH FLOWS FROM FINANCING ACTIVITIES:
 Cash paid on related party loans                     (1,600)        (7,500)
 Proceeds from related party loans                     8,350         19,200
 Capital contribution                                      -          7,500
                                               -------------  -------------
NET CASH PROVIDED BY FINANCING ACTIVITIES              6,750         19,200
                                               -------------  -------------
NET INCREASE IN CASH                                   1,266          1,161

CASH AT BEGINNING OF YEAR                              2,934          1,773
                                               -------------  -------------
CASH AT END OF YEAR                            $       4,200  $       2,934
                                               =============  =============

SUPPLEMENTAL CASH FLOW INFORMATION Cash paid during the year for:
  Interest                                     $       5,849  $       3,552
  Income taxes                                 $           -  $           -

SUMMARY OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
For the year ended September 30, 2006:
  In October 2005, the Company issued 160,000 shares of Series A convertible
  preferred stock to settle a prior year liability consisting of $2,000 in
  director fees and $6,000 in salary.

For the year ended September 30, 2005:
  None
</Table>
              See accompanying notes and accountants' report.
                                     Page 9
<PAGE>




                 ADVANCE TECHNOLOGIES, INC. AND SUBSIDIARY
               NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization - Advance Technologies, Inc. ("Parent") was organized under the
laws of the State of Delaware on June 16, 1969 as PWB Industries, Inc.  In
August 1997, Parent changed its name to Advance Technologies, Inc. and changed
its domicile to Nevada.

Infrared Systems International ("Subsidiary") was organized under the laws of
the State of Nevada on April 11, 2006 as a wholly-owned subsidiary of Parent.

Advance Technologies, Inc. and Subsidiary ("the Company") licenses rights to use
optical technology developed by the Company. The Company also plans to develop a
night vision system with applications in the military and civil aircraft. Prior
to the year ended September 30, 2006, the Company was considered a development
stage company as defined in Statement of Financial Accounting Standards No. 7.
The Company has, at the present time, not paid any dividends and any dividends
that may be paid in the future will depend upon the financial requirements of
the Company and other relevant factors.

Consolidation - The consolidated financial statements include the accounts of
Parent and Parent's wholly-owned Subsidiary. All inter-company transactions have
been eliminated in consolidation.

Use of Estimates - The preparation of financial statements in conformity with
U.S. generally accepted accounting principles requires management to make
estimates and assumptions that affect certain reported amounts and disclosures.
Accordingly, actual results could differ from those estimates.

Fair Value of Financial Instruments - The carrying values of accounts receivable
and accounts payable approximate fair value due to the short maturity of these
instruments. The carrying values of related party loans approximate fair value
based on discounting the projected cash flows using market rates available for
similar maturities. None of the financial instruments are held for trading
purposes.

Cash and Cash Equivalents - The Company considers all highly-liquid debt
investments purchased with a maturity of three months or less to be cash
equivalents.

Accounts Receivable - The Company records accounts receivable at the lower of
cost or fair value. The Company estimates allowances for doubtful accounts based
on the aged receivable balances and historical losses. The Company charges off
uncollectible accounts receivable when management estimates no possibility of
collecting the related receivable.

                                     Page 10
<PAGE>




















                 ADVANCE TECHNOLOGIES, INC. AND SUBSIDIARY
               NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Continued]

Property and Equipment - The Company records property and equipment at cost and
uses straight-line depreciation methods. Maintenance, repairs, and expenditures
for renewals and betterments not determined to extend the useful lives or to
materially increase the productivity of the assets are expensed as incurred.
Other renewals and betterments are capitalized.

Revenue Recognition - The Company's revenue primarily comes from royalties from
the licensing of technology. Licensing royalty revenue is recognized when the
licensee has delivered a product to their customer, there is an agreed upon
price for the product, and collection of the revenue is reasonably assured. The
Company has also generated some revenues from consulting arrangements.
Consulting revenue is recognized when the services are rendered, there is an
agreed upon price for the services, and collection of the revenue is reasonably
assured.

Reclassification - Certain amounts in prior-year financial statements have been
reclassified for comparative purposes to conform with presentation in the
current-year financial statements.

Recent Accounting Standards - Statement of Financial Accounting Standards No.
154, "Accounting Changes and Error Corrections - a replacement of APB Opinion
No. 20 and FASB Statement No. 3," was recently issued and is effective for
fiscal years beginning after December 15, 2005. Had the Company applied the
provisions of SFAS No. 154, their effects on the financial statements would not
have been significant.

NOTE 2 - RESTATEMENT

The accompanying consolidated financial statements for the year ending September
30, 2005 have been restated to correct errors made in prior period financial
statements. Specifically, the Company (1) has corrected the reporting of revenue
from the cash method to the accrual method, (2) has corrected the reporting of
revenue from gross to net of related discounts, (3) has corrected the recording
of compensation to accrue officer and director compensation in the period
earned, (4) has corrected interest expense to impute interest expense on
non-interest-bearing related party loans, and (5) has corrected the liabilities
and expenses to include credit card transactions.

                                     Page 11
<PAGE>

























                 ADVANCE TECHNOLOGIES, INC. AND SUBSIDIARY
               NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NOTE 2 - RESTATEMENT [Continued]

The effect of the restatement was to increase net loss for the year ended
September 30, 2005 by $11,384 ($0.00 per share).

<Table>
<Caption>
The following summarizes corrections to the September 30, 2005 statement of
operations:

                                                         Amount Per Share
                                                      --------    ---------
<S>                                                   <C>         <C>
Net loss, as previously reported                      $(35,788)   $   (0.00)
Additional revenue from recording accounts receivable    6,600         0.00
Revenue eliminated by related discounts                (16,000)       (0.00)
Eliminated discounts                                    16,000         0.00
Additional compensation expense                         (8,000)       (0.00)
Additional credit card expenses                         (1,220)       (0.00)
Imputed interest expense                                (5,212)       (0.00)
Credit card interest expense                            (3,552)       (0.00)
                                                      --------    ---------
Net loss, as restated                                 $(47,172)   $   (0.00)
</TABLE>

<TABLE>
<Caption>
Retained earnings at September 30, 2004 has been adjusted for the cumulative
effect of these financial statement corrections, as follows:

                                                                   Amount
                                                                 ----------
<S>                                                              <C>
Retained earnings, as previously reported                        $(672,252)
Imputed interest expense                                           (19,084)
                                                                 ----------
Retained earnings, as restated                                   $(691,336)
</TABLE>

<TABLE>
<Caption>
The effects of the restatements on quarterly condensed financial results are as
follows:

                      For the Quarter     For the Quarter     For the Quarter
                           Ended               Ended               Ended
                     December 31, 2005     March 31, 2006      June 30, 2006
                     --------  --------  --------  --------  --------  --------
<S>                  <C>       <C>       <C>       <C>       <C>       <C>
Revenues             $  6,300  $  6,300  $  4,800  $  4,800  $ 13,907  $ 13,907
Operating expenses    (15,591)  (18,911)  (23,371)  (25,477)  (26,940)  (20,531)
Interest expense            -    (2,373)   (1,487)   (2,814)   (1,543)   (3,112)
Income tax expense          -         -         -         -         -         -
                     --------  --------  --------  --------  --------  --------
Net loss             $ (9,291) $(14,984) $(20,058) $(23,491) $(14,576) $ (9,736)
                     --------  --------  --------  --------  --------  --------
Loss per share       $  (0.00) $  (0.00) $  (0.00) $  (0.00) $  (0.00) $  (0.00)
                     --------  --------  --------  --------  --------  --------
</Table>

                                     Page 12
<PAGE>








                 ADVANCE TECHNOLOGIES, INC. AND SUBSIDIARY
               NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NOTE 3 - GOING CONCERN

The Company's financial statements have been presented on the basis that it is a
going concern, which contemplates the realization of assets and the satisfaction
of liabilities in the normal course of business. At September 30, 2006, the
Company had current liabilities in excess of current assets and had incurred
losses during the last two years. These factors create an uncertainty about the
Company's ability to continue as a going concern. In this regard, management is
proposing to raise any necessary additional funds not provided by operations
through loans or through additional sales of common stock. There is no assurance
that the Company will be successful in raising this additional capital or in
achieving profitable operations. The financial statements do not include any
adjustments that might be necessary if the Company is unable to continue as a
going concern.

NOTE 4 - PROPERTY AND EQUIPMENT
<Table>
<Caption>
                                                  Estimated    September 30,
                                                 Useful Lives      2006
                                                 ------------  -------------
<S>                                              <C>           <C>
Lens                                                5 years    $      26,000
Office equipment                                    5 years           14,139
                                                               -------------
                                                                      40,139
Less accumulated depreciation                                        (39,419)
                                                               -------------
Net Property and Equipment                                     $         720
                                                               -------------
</Table>

Depreciation expense for the years ended September 30, 2006 and 2005 was $884
and $5,711, respectively.

NOTE 5 - DEFINITE-LIFE INTANGIBLE ASSETS
<Table>
<Caption>
                                                  Estimated    September 30,
                                                 Useful Lives      2006
                                                 ------------  -------------
<S>                                              <C>           <C>
Pending Patent Application                           N/A       $       3,000
                                                               -------------
                                                                       3,000
Less accumulated amortization                                              -
                                                               -------------
Net Definite-life Intangible Assets                            $       3,000
                                                               -------------
</Table>

The Company's definite-life intangible assets consist only of a pending patent
application. Once a patent has been granted, the Company will amortize the
related costs over the estimated useful life of the patent. If a patent
application is denied, the related costs will be expensed immediately.

                                     Page 13
<PAGE>









                 ADVANCE TECHNOLOGIES, INC. AND SUBSIDIARY
               NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NOTE 6 - CAPITAL STOCK

Series A Convertible Preferred Stock - Each share of Series A convertible
preferred stock has no rights except that it can be converted into one share of
common stock following a two-year holding period.

In April, June, and September 2006, the Company issued a total of 300,000 shares
of Series A convertible preferred stock to a consultant for services valued at
$7,510 (approximately $0.025 per share).

In March, June, and September 2006, the Company issued a total of 841,000 shares
of Series A convertible preferred stock to directors of the Company for services
valued at $21,629 (approximately $0.026 per share).

In February 2006, the Company issued 100,000 shares of Series A convertible
preferred stock to a consultant for services valued at $3,900 ($0.039 per
share).

In October and December 2005, the Company issued a total of 360,000 shares of
Series A convertible preferred stock to directors of the Company for services
valued at $19,000 (approximately $0.053 per share) of which $8,000 was earned
during the quarter ended September 30, 2005.

Conversions - In April and May 2006, shareholders converted a total of 29,680
shares of Series A convertible preferred stock into 29,680 shares of common
stock.

In January, May, and August 2005, shareholders converted a total of 11,178,801
shares of Series A convertible preferred stock into 11,178,801 shares of common
stock.

Capital Contribution - In December 2004, an owner/shareholder of the Company
contributed cash of $7,500.

NOTE 7 - INCOME TAXES

At September 30, 2006, the Company has available unused federal operating loss
carry-forwards of approximately $152,300 which may be applied against future
taxable income and which expire in various years from 2023 through 2026. The
amount of and ultimate realization of the benefits from the operating loss
carry-forwards for income tax purposes is dependent, in part, upon the tax laws
in effect, the future earnings of the Company and other future events, the
effects of which cannot be determined. Because of the uncertainty surrounding
the realization of the loss carry-forwards, the Company has established a
valuation allowance equal to the tax effect of the loss carry-forwards and,
therefore, no deferred tax asset has been recognized in the financial statements
for the loss carry-forwards. The net deferred tax assets are approximately
$22,800 and $13,500 as of September 30, 2006 and 2005, respectively, with an
offsetting valuation allowance of the same amount, resulting in a change in the
valuation allowance of approximately $9,300 during the year ended September 30,
2006.

                                     Page 14
<PAGE>












                 ADVANCE TECHNOLOGIES, INC. AND SUBSIDIARY
               NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NOTE 8 - RELATED PARTY TRANSACTIONS

Related Party Loans - During the years ended September 30, 2006 and 2005,
respectively, an officer/shareholder of the Company loaned $8,350 and $19,200 to
the Company and the Company repaid loans totaling $1,600 and $7,500. At
September 30, 2006, the Company owes a total of $77,750 to an
officer/shareholder. The loans bear no interest and are due on demand; however,
the Company is imputing interest at 8% per annum. During the years ended
September 30, 2006 and 2005, respectively, the Company imputed interest expense
of $6,030 and $5,212.

Management Compensation - The Company has not paid any cash compensation to any
officer or director of the Company. However, the Company issued a total of
1,201,000 shares of Series A convertible preferred stock to directors of the
Company for services rendered during the years ended September 30, 2006 and 2005
valued at $32,629 and $8,000, respectively.

Office Space - In January 2006, the Company started renting office space from an
officer/shareholder of the Company for $400 per month. During the year ended
September 30, 2006, the Company paid or accrued $3,600 in rent to the
officer/shareholder.

NOTE 9 - CONCENTRATIONS

At September 30, 2006, 100% of the Company's accounts receivable was due from a
single licensee. During the years ended September 30, 2006 and 2005, 100% of the
Company's royalty revenues were generated through a single licensee. During the
years ended September 30, 2006 and 2005, 100% of the Company's consulting
revenues were generated through a single customer.

                                     Page 15


<Page>
































Item 8A. Controls and Procedures

The President/CEO/CFO maintains direct control over all financial proceedings of
the company.

The President reviews all expenditures and reconciles all income and expenses
through the Corporate Bank account. The President is the only person authorized
for this account. This procedure has been used since the original company was
established in 1993.

The President maintains budget control, and the Board of Directors authorizes
any new expenses.



ITEM 8B.  OTHER INFORMATION

Unregistered Sales of Equity Securities and Use of Proceeds.

During the 12 months ended June 30, 2006, the Company issued or approved the
issuance of an aggregate of 864,000 shares of AVTX Preferred Stock to four
directors or employees of the Company in consideration for services provided to
the Company. The transactions were non-public offerings of securities exempt
from registration under the Securities Act of 1933, as amended, by virtue of
Section 4(2) thereof.










































                                            PART III

ITEM 9. Directors, Executives Officers, Promoters, Control Personnel, and
Corporate Governance.



DIRECTORS, EXECUTIVE OFFICERS AND SIGNIFICANT EMPLOYEES.


(a) Directors and Executive Officers

------------------------      -------   -------------------------------
Name                          Age       Position
------------------------      -------   -------------------------------
Gary E. Ball                  69        CEO, President, and Director
------------------------      -------   -------------------------------
Gary L. Bane                  68        Director (1)
------------------------      -------   -------------------------------
James Watson                  57        Director (2)
------------------------      -------   -------------------------------


(1) Became a director on October 1, 2004. (2) Became a director on January 1,
2005.



(b) Qualifications


Mr. James Watson has joined Advance Technologies Board of Directors. Mr.
Watson's extensive experience as Director of Marketing for Western Airlines will
provide valuable sight into marketing issues affecting the entry of EVS into the
passenger segment of commercial aviation. Mr. Watson's term with the Board began
January 1, 2005.


Mr. JAMES R. WATSON
Sales, Marketing and General Management Executive with over twenty- five years
experience in managing a wide range of marketing, sales and operations functions
designed to create or expand domestic and international sales opportunities.


      CALIFORNIA MANUFACTURING TECHNOLOGY CONSULTING, Gardena, California,


1999-Present, Vice President Operations 2001-Present Responsible for marketing,
sales, consulting services and the development of delivery tools and services.
Redirected the organization from a service to industry "Go to Market" strategy.
Established Aerospace & Defense and Distribution industry teams.


ANCHOR AUDIO, INC., Los Angeles, California, 1994 to 1999 Vice President Sales &
General Manager Europe 1994-1999 Responsible for domestic sales planning, field
sales, government and OEM sales. Established and managed the day to day
operation of a European distribution center and dealership. Developed and
implemented the distribution strategy and the sales/marketing programs for
offices in Europe, Mexico, and the South Pacific and for distributors worldwide.


WESTERN AIRLINES, Los Angeles, California, 1971 to 1985 Vice President Passenger
& Cargo Sales, 1983 to 1985 Responsible for managing over 1100 people in sales
programs, field sales, reservations and advertising with a budget in excess of
$150 million.


GARY E. BALL


Age 69, residing in The Woodlands, Texas is married. He attended California
State University at Long Beach graduated with a BSEE and MSEE, went on to
perform Graduate Studies at University of Southern California. He has
specialized in product design, development, and management for North American
Aviation. Was Technical Manager for the Pave Tack program at Ford Aerospace
corp. Program Manager for Northrop Electro-Mechanical in charge of business
development for several classified DOD programs. Was Program Manager for Hughes
Aircraft where he developed the Infrared Enhanced Vision System reporting to the
President of EDSG. Was a member of NATO NIAG study group on Aircraft
Integration. He has authored several articles for trade publications. In the
last 10 years he has provided consulting services to more than 10 U.S. and
foreign corporations in the field of IR technology.


GARY L. BANE


On June 15, 2004 the Board of Directors extended an invitation to Gary L. Bane
 to re-join the Board of Directors of Advance Technologies Inc. Mr. Bane had
been on ATI's BOD since our founding in 1992. Mr. Bane withdrew from the BOD in
2002 due to pressing demands from his many business commitments. We are pleased
that Mr. Bane's schedule has abated, which has permitted him to re-join
the BOD. Mr. Bane term on ATI's BOD was effective on October 1, 2004.  Mr. Bane
has been employed as an independent consultant for
the last five years.




Audit Committee and Audit Committee Financial Expert

      Our board of directors functions as an audit committee and performs some
of the same functions as an audit committee including: (1) selection and
oversight of our independent accountant; (2) establishing procedures for the
receipt, retention and treatment of complaints regarding accounting, internal
controls and auditing matters; and (3) engaging outside advisors. We are not a
"listed company" under SEC rules and are therefore not required to have an audit
committee comprised of independent directors. Our board of directors has
determined that its members do not include a person who is an "audit committee
financial expert" within the meaning of the rules and regulations of the SEC.
Our board of directors has determined that each of its members is able to read
and understand fundamental financial statements and has substantial business
experience that results in that member's financial sophistication. Accordingly,
the board of directors believes that each of its members have the sufficient
knowledge and experience necessary to fulfill the duties and obligations that an
audit committee would have.

Code of Ethics

      A code of ethics relates to written standards that are reasonably designed
to deter wrongdoing and to promote:

      o           Honest and ethical conduct, including the ethical handling of
                  actual or apparent conflicts of interest between personal and
                  professional relationships;

      o           Full, fair, accurate, timely and understandable disclosure in
                  reports and documents that are filed with, or submitted to,
                  the SEC and in other public communications made by an issuer;

      o     Compliance with applicable governmental laws, rules and regulations;

      o     The prompt internal reporting of violations of the code to an
            appropriate person or persons identified in the code; and

      o     Accountability for adherence to the code.

      Due to the limited scope of our current operations, we have not adopted a
corporate code of ethics that applies to its principal executive officer,
principal accounting officer, or persons performing similar functions.

Board Meetings; Nominating and Compensation Committees

      Our directors and officers do not receive remuneration from us unless
approved by the Board of Directors or pursuant to an employment contract. We
have no employment contracts currently in place. Directors may be paid their
expenses, if any, of attendance at such meeting of the Board of Directors, and
may be paid a fixed sum for attendance at each meeting of the Board of Directors
or a stated fixed compensation as director. No such payment shall preclude any
director from serving us in any other capacity and receiving compensation
therefore. No compensation has been paid to our directors for attendance at any
meetings during the last fiscal year.

      We are not a "listed company" under SEC rules and are therefore not
required to have a compensation committee or a nominating committee. We do not
currently have a compensation committee. We have no employees, and any
compensation for our directors and officers must be approved by the Board of
Directors.

      We neither have a nominating committee for persons to be proposed as
directors for election to the Board of Directors nor a formal method of
communicating nominees from shareholders. We do not have any restrictions on
shareholder nominations under our certificate of incorporation or by-laws. The
only restrictions are those applicable generally under Nevada law and the
federal proxy rules. Currently, the entire Board of Directors decides on
nominees, on the recommendation of the sole member of the Board of Directors who
is not independent. The Board of Directors will consider suggestions from
individual shareholders, subject to evaluation of the person's merits.
Stockholders may communicate nominee suggestions directly to the sole Board
member, accompanied by biographical details and a statement of support for the
nominees. The suggested nominee must also provide a statement of consent to
being considered for nomination. Although there are no formal criteria for
nominees, the Board of Directors believes that persons should be actively
engaged in business endeavors, have a financial background, and be familiar with
acquisition strategies and money management.

      Because the management and directors of the Company are the same person,
the Board of Directors has determined not to adopt a formal methodology for
communications from shareholders on the belief that any communication would be
brought to the Boards' attention by virtue of the co-extensive capacities served
by Gary Ball.

Conflicts of Interest

      Certain conflicts of interest existed at September 30, 2006 and may
continue to exist between us and our sole officer and director due to the fact
that he has other business interests to which he devotes his attention. Each
officer and director may continue to do so notwithstanding the fact that
management time should be devoted to our business.

      Certain conflicts of interest may exist between us and our management, and
conflicts may develop in the future. We have not established policies or
procedures for the resolution of current or potential conflicts of interests
between us, our officers and directors or affiliated entities. There can be no
assurance that management will resolve all conflicts of interest in favor of us,
and conflicts of interest may arise that can be resolved only through the
exercise by management their best judgment as may be consistent with their
fiduciary duties. Our management will try to resolve conflicts to the best
advantage of all concerned.

Indemnification

      Under Nevada law and pursuant to our articles of incorporation and bylaws,
we may indemnify our officers and directors for various expenses and damages
resulting from their acting in these capacities. Insofar as indemnification for
liabilities arising under the Securities Act of 1933 may be permitted to our
officers or directors pursuant to those provisions, our counsel has informed us
that, in the opinion of the SEC, this indemnification is against public policy
as expressed in the Securities Act, and is therefore unenforceable.



Section 16(a) Beneficial Ownership Reporting

      Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
that directors, executive officers and persons who own more than 10% of the
outstanding common stock of certain reporting companies file initial reports of
ownership and reports of changes in ownership in such common stock with the
Securities and Exchange Commission ("SEC"). Officers, directors and stockholders
who own more than 10% of the outstanding common stock of certain reporting
companies are required by the SEC to furnish such companies with copies of all
Section 16(a) reports they file. We are required to comply with Section 16(a).
Accordingly, stock ownership information contained in this report is based on
what is known to us.


ITEM 10.


EXECUTIVE COMPENSATION


Remunerations were paid to the directors and the President/CEO of the Company
during the fiscal year ending September 30, 2006. 348,000 preferred shares were
issued to Gary E. Ball and 58,000 shares of preferred were issued to Gary L.
Bane and James Watson respectively.


ITEM 11.


SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN SECURITY HOLDERS.

Title of    Name and address
class       of owner            Amount owned   Percent of class
---------   ----------------    ------------   ----------------
Common      Gary Ball           1,523,600      4%
Preferred                       5,664,850      22%
---------   ----------------    ------------   ----------------
Common      Wendy Ball          1,523,600      4%
Preferred                       5,644,850      22%
---------   ----------------    ------------   ----------------
Common      Gary L. Bane          277,200       1%
Preferred                         724,800       3%
---------   ----------------    ------------   ----------------
Preferred   Jim Watson             58,000       ~
---------   ----------------    ------------   ----------------



PERSONS HOLDING 10% OR MORE OF AVTX STOCK


None that have been reported.


PERSONS HOLDING WARRANTS, OPTIONS OR OTHER RIGHTS


None


ITEM 12.


CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.


Advance Technologies Inc. utilizes office space and storage provided by Gary
Ball, for which it pays Mr. Ball $400 per month.


Other than the above, transactions or otherwise set forth in this report we have
not entered into any material transaction with any director, executive officer,
and nominee for director, beneficial owner of five percent or more of our common
stock, or family members of such persons. Also, we have not had any transactions
with any promoter. We are not a subsidiary of any company.






ITEM 13.   EXHIBITS.

Number      Description

2.1         Articles of Incorporation (1)
2.2         Amendment to Articles of Incorporation (1)
2.3         Amendment to Articles of Incorporation (1)
2.4         Amended Bylaws (1)
3.1         See Articles of Incorporation, as Amended (1)
6.1               License Agreement with Infrared Enhanced Vision Sensor
            System (2)

31.1        Certification of President and Chief Executive Officer Pursuant to
            18 U.S.C. Section 1350 as Adopted Pursuant to Section 302 of the
            Sarbanes-Oxley Act of 2002.
32.1        Certification of President and Chief Executive Officer Pursuant to
            Rule 13-14 or Rule 15-14 of the Securities and Exchange Act of 1934
            as adopted pursuant to Section 906 of The Sarbanes-Oxley act of
            2002.

(1) Incorporated by reference to the exhibits to Registrant's Registration
Statement on Form 10-SB filed on August 30, 1999, File Number 000-27175. (2)
Incorporated by reference to the exhibits to Registrant's Annual Report on Form
10-KSB filed on December 15, 2006.



Item 14. Principle Accountant Fees and Services


(1)      Audit fees for 2005 & 2006

                  Chisholm, Bierwolf & Neilson  were $ 8,823.00

(2)      Corporate SEC attorney  Ed Swanson were $ 3,030.00

(3)      Corporate Accountant  Michael Larsen were $ 9,146.00

(4) N/a

(5) Estimated at 30%

(6) N/a
























                                   SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities and
Exchange Act of 1934, the Company has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

Date: January 15, 2007            Advance Technologies, Inc.
                                  (Registrant)



                                By:/s/ GARY E. BALL
                                    ---------------------------------------
                                  Gary E. Ball
                                   President and Director


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


                     /s/ Gary E. Ball
                   -----------------------------------------
                    Gary E. Ball, Principle Executive Officer



                     /s/ Gary E. Ball
                    -----------------------------------------
                    Gary E. Ball, Principle Financial Officer


                     /s/ Gary E. Ball
                    -----------------------------------------
                    Gary E. Ball, Controller or Principle Accounting Officer


                     /s/ Gary E. Ball
                    -----------------------------------------
                    Gary L. Bane, Director


                     /s/ James Watson
                    -----------------------------------------
                    James Watson, Director