**UNITED
      STATES** **SECURITIES
      AND EXCHANGE COMMISSION** **Washington,
      D.C. 20549**







**FORM
      10-QSB/A**


**(First
      Amendment)**




(Mark
      One)


[
                X
                ]
            QUARTERLY
                REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
                1934For
                the quarterly period ended June 30, 2005[  
                ]
            TRANSITION
                REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACTFor
                the transition period from ________________ to
                _________________
              
              Commission
                file number 000-50742





**SIGN
                MEDIA SYSTEMS, INC**.
              (Exact
                name of small business issuer as specified in its
                charter)FLORIDA
              (State
                or other jurisdiction of incorporation or organization)
            02-0555904
              (IRS
                Employer Identification No.)2100
                19thStreet, Sarasota FL 34234
              (Address
                of principal executive offices)(941)
                330-0336
              (Issuer's
                telephone number)__________________________________________
              (Former
                name, former address and former fiscal year, if changed since last
                report)





**APPLICABLE
      ONLY TO CORPORATE ISSUERS**




State
      the
      number of shares outstanding of each of the issuer's classes of common equity,
      as of the latest practicable date: 8,460,000 Common Shares no par value as
      of
      June 30, 2005.





Transitional
      Small Business Disclosure Format (Check one): Yes [ ] No [ X ]


1


**PART
      I — FINANCIAL INFORMATION**





**Item
      1. Financial Statements.**





**INDEX
      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**


**CONDENSED
      CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)**





Condensed
                Consolidated Balance Sheet (Unaudited) as of June 30, 2005
            F-1Condensed
                Consolidated Statements of Income (Operations) for the
              Six
                and Three Months Ended June 30, 2005 and 2004
                (Unaudited)
            F-2Condensed
                Consolidated Statements of Cash Flows for the Six Months
              Ended
                June 30, 2005 and 2004 (Unaudited)
            F-3Notes
                to Condensed Consolidated Financial Statements
            F-4-12




















2


**SIGN
      MEDIA SYSTEMS, INC.CONDENSED CONSOLIDATED BALANCE SHEETJUNE 30,
      2005**


**(UNAUDITED)**




**ASSETS****(restated)****CURRENT
                  ASSETS**Cash
                  and cash equivalents
              
              $
              13,705Accounts
                  receivable
              
              
              8,929Inventory
              
              
              78,036**Total
                  current assets**
              
              
              100,670**PROPERTY
                  AND EQUIPMENT - Net**
              
              
              186,527**OTHER
                  ASSETS**Due
                  from related parties
              
              
              1,200,000**Total
                  other assets**
              
              
              1,200,000**TOTAL
                  ASSETS**
              
              $
              1,487,197**LIABILITIES
                  AND STOCKHOLDERS' EQUITY****CURRENT
                  LIABILITIES**Deferred
                  revenue
              
              $
              250,000Liability
                  for stock to be issued
              
              
              224,900Accounts
                  payable and accrued expenses
              
              
              222,823Due
                  to related parties
              
              
              19,985Current
                  portion of long-term debt
              
              
              9,211**Total
                  current liabilities**
              
              
              726,919**Long-term
                  debt - net of current portion**
              
              
              51,184**TOTAL
                  LIABILITIES**
              
              $
              778,103**STOCKHOLDERS'
                  EQUITY**Common
                  stock, no par value, 100,000,000 shares authorized atJune
                  30, 2005 and 8,460,000 shares issued and outstandingat
                  June 30, 2005
              
              $
              5,000Additional
                  paid-in capital
              
              
              671,700Accumulated
                  deficit
              
              
              32,394**Total
                  stockholders' equity**
              
              
              709,094**TOTAL
                  LIABILITIES AND STOCKHOLDERS' EQUITY**
              
              $
              1,487,197






The
      accompanying notes are an integral part of these condensed consolidated
      financial statements.


F
          -
          1


**SIGN
        MEDIA SYSTEMS, INC.CONDENSED CONSOLIDATED STATEMENTS OF INCOMEFOR THE
        SIX AND THREE MONTHS ENDED JUNE 30, 2005 AND 2004** **(UNAUDITED)**
  **SIX
                    MONTHS ENDED**
                
                **THREE
                    MONTHS ENDED****June
                    30,**
                
                **June
                    30,**
                
                **June
                    30,**
                
                **June
                    30,****2005**
                
                **2004**
                
                **2005**
                
                **2004****(restated)**
                
                
                
                **(restated)****REVENUE**
                
                $
                511,385
                
                $
                654,484
                
                $
                489,114
                
                $
                371,884**COST
                    OF GOODS SOLD**
                
                
                13,396
                
                
                94,260
                
                
                10,889
                
                
                39,116**GROSS
                    PROFIT**
                
                
                497,989
                
                
                560,224
                
                
                478,225
                
                
                332,768**OPERATING
                    EXPENSES**Professional
                    fees
                
                
                33,854
                
                
                28,021
                
                
                13,244
                
                
                6,664General
                    and administrative expenses
                
                
                343,798
                
                
                249,095
                
                
                186,534
                
                
                94,926Depreciation
                
                
                24,941
                
                
                16,715
                
                
                13,050
                
                
                12,215**Total
                    operating expenses**
                
                
                402,593
                
                
                293,831
                
                
                212,828
                
                
                113,805**NET
                    INCOME BEFORE OTHER INCOME (EXPENSE)**
                
                
                95,396
                
                
                266,393
                
                
                265,397
                
                
                218,963**OTHER
                    INCOME (EXPENSE)**Other
                    income
                
                
                103
                
                
                
                
                
                101Recovery
                    of bad debt expense
                
                
                500,000
                
                
                
                
                
                500,000Interest
                    expense
                
                
                (918
                )
                
                (35,132
                )
                
                (615
                )
                
                (35,040
                )**Total
                    Other Income (Expense)**
                
                
                499,185
                
                
                (35,132
                )
                
                499,486
                
                
                (35,040
                )**NET
                    INCOME BEFORE PROVISION FOR INCOME TAXES**
                
                
                594,581
                
                
                231,261
                
                
                764,883
                
                
                183,923Provision
                    for income taxes
                
                
                -
                
                
                -
                
                
                -
                
                
                -**NET
                    INCOME APPLICABLE TO COMMON SHARES**
                
                $
                594,581
                
                $
                231,261
                
                $
                764,883
                
                $
                183,923**NET
                    INCOME PER BASIC AND DILUTED SHARES**
                
                
                0.070
                
                
                0.028
                
                
                0.090
                
                
                0.022**WEIGHTED
                    AVERAGE NUMBER OF COMMON****SHARES
                    OUTSTANDING**
                
                
                8,460,000
                
                
                8,256,631
                
                
                8,460,000
                
                
                8,460,000
   The
        accompanying notes are an integral part of these condensed consolidated
        financial statements.








F
          -
          2


**SIGN
        MEDIA SYSTEMS, INC.CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWSFOR
        THE SIX MONTHS ENDED JUNE 30, 2005 AND 2004** **(UNAUDITED)**
  **2005**
                
                **2004****(restated)****CASH
                    FLOWS FROM OPERATING ACTIVITIES:**Net
                    income
                
                $
                594,581
                
                $
                231,261Adjustments
                    to reconcile net income to net cash provided byoperating
                    activitiesDepreciation
                
                
                24,941
                
                
                16,715**Changes
                    in assets and liabilities:**(Increase)
                    in accounts receivable
                
                
                541,649
                
                
                (235,582
                )(Increase)
                    decrease in inventory
                
                
                7,536
                
                
                2,850Decrease
                    in prepaid expenses and other current assets
                
                
                4,000
                
                
                39,666(Increase)
                    in miscellaneous receivable
                
                
                -
                
                
                (4,000
                )Increase
                    in accounts payable and accrued expenses
                
                
                52,834
                
                
                17,248Increase
                    in deferred revenue
                
                
                250,000
                
                
                -**Total
                    adjustments**
                
                
                880,960
                
                
                (163,103
                )**Net
                    cash provided by operating activities**
                
                
                1,475,541
                
                
                68,158**CASH
                    FLOWS FROM INVESTING ACTIVITIES:**Acquisition
                    of property and equipment
                
                
                (86,913
                )
                
                (47,230
                )**Net
                    cash (used in) investing activities**
                
                
                (86,913
                )
                
                (47,230
                )**CASH
                    FLOWS FROM FINANCING ACTIVITIES:**Increase
                    in liability for stock to be issued
                
                
                24,900
                
                
                -Payments
                    on long-term debt
                
                
                (9,209
                )
                
                (52,089
                )Payments
                    on debt - related parties
                
                
                (1,396,966
                )
                
                (183,142
                )Contribution
                    of additional paid-in capital
                
                
                -
                
                
                200,000**Net
                    cash (used in) financing activities**
                
                
                (1,381,275
                )
                
                (35,231
                )**NET
                    INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS**
                
                
                7,353
                
                
                (14,303
                )**CASH
                    AND CASH EQUIVALENTS - BEGINNING OF PERIOD**
                
                
                6,352
                
                
                47,068**CASH
                    AND CASH EQUIVALENTS - END OF PERIOD**
                
                $
                13,705
                
                $
                32,765**SUPPLEMENTAL
                    DISCLOSURE OF CASH FLOW INFORMATION:**Cash
                    paid during the period for interest.
                
                $
                -
                
                $
                35,132**SUPPLEMENTAL
                    NON-CASH INVESTING ACTIVITIES:**Conversion
                    of liability to common stock
                
                $
                -
                
                $
                324,000
   The
        accompanying notes are an integral part of these condensed consolidated
        financial statements.






F
          -
          3


**SIGN
        MEDIA SYSTEMS, INC.**
 **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 JUNE
        30,
        2005 AND 2004
 
 NOTE
        1
        -ORGANIZATION
        AND BASIS OF PRESENTATION
 
 The
        condensed unaudited interim financial statements included herein have been
        prepared by Sign Media Systems, Inc. (the “Company”) without audit, pursuant to
        the rules and regulations of the Securities and Exchange Commission (the
“SEC”).
        Certain information and footnote disclosures normally included in the financial
        statements prepared in accordance with accounting principles generally accepted
        in the United States of America have been condensed or omitted as allowed
        by
        such rules and regulations, and the Company believes that the disclosures
        are
        adequate to make the information presented not misleading. It is suggested
        that
        these condensed consolidated financial statements be read in conjunction
        with
        the December 31, 2004 audited financial statements and the accompanying notes
        thereto. While management believes the procedures followed in preparing these
        condensed financial statements are reasonable, the accuracy of the amounts
        are
        in some respects dependent upon the facts that will exist, and procedures
        that
        will be accomplished by the Company later that year.
 
 The
        management of the Company believes that the accompanying unaudited condensed
        consolidated financial statements contain all adjustments (including normal
        recurring adjustments) necessary to present fairly the operations and cash
        flows
        for the periods presented.
 
 The
        Company began business as Go! Agency LLC, a Florida Limited Liability Company
        (“Go Agency”). Go Agency was formed in April 2000 , principally
        to pursue third party truck side advertising. The principal of Go Agency
        invested approximately $857,000 in Go Agency pursuing this business. It became
        apparent that a more advanced truck side mounting system would be required
        and
        that third party truck side advertising alone would not sustain an ongoing
        profitable business. Go Agency determined to develop a technologically advanced
        mounting system and focused on a different business plan.
 
 
 
 
 F
            -
            4
 
 SIGN
          MEDIA SYSTEMS, INC.NOTES
          TO
          CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
          (CONTINUED)
 **JUNE
        30, 2005 AND 2004**
 
 
 NOTE
        1
        -ORGANIZATION
        AND BASIS OF PRESENTATION (CONTINUED)
 
 The
        Company was incorporated on January 28, 2002 as a Florida corporation. Upon
        incorporation, an officer of the Company contributed $5,000 and received
        1,000
        shares of common stock of the Company. Effective January 1, 2003, the Company
        issued 7,959,000 shares of common stock in exchange of $55,702 of net assets
        of
        GO! Agency, LLC, a Florida limited liability company (“Go Agency”), a company
        formed on June 20, 2000, as E Signs Plus.com, LLC, a Florida limited liability
        company. In this exchange, the Company assumed some debt of GO! Agency and
        the
        exchange qualified as a tax-free exchange under IRC Section 351. The net
        assets
        received were valued at historical cost. The net assets of Go Agency that
        were
        exchanged for the shares of stock were as follows:
 Accounts
                    receivable
                
                $
                30,668Fixed
                    assets, net of depreciation
                
                
                112,214Other
                    assets
                
                
                85,264Accounts
                    payable
                
                
                (29,242
                )Notes
                    payable
                
                
                (27,338
                )Other
                    payables
                
                
                (115,864
                )Totals
                
                $
                55,702
 
 Go
        Agency was formed to pursue third party truck advertising. The principal
        of Go
        Agency invested approximately $857,000 in Go Agency pursuing this business.
        It
        became apparent that a more advanced truck side mounting system would be
        required and that third party truck side advertising alone would not sustain
        an
        ongoing profitable business. Go Agency determined to develop a technologically
        advanced mounting system and focused on a different business plan. Go Agency
        pre-exchange transaction was a company under common control of the major
        shareholder of SMS. Post-exchange transactions have not differed. Go Agency
        still continues to operate and is still under common control.
 
 Go
        Agency and the Company developed a new and unique truck side mounting system,
        which utilizes a proprietary cam lever technology, which allows an advertising
        image to be stretched tight as a drum. Following the exchange, the Company
        had
        7,960,000 shares of common stock issued and outstanding. The Company has
        developed and filed an application for a patent on its mounting systems.
        The cam
        lever technology is considered an intangible asset and has not been recorded
        as
        an asset on the Company’s consolidated balance sheet. This asset was not recoded
        due to the fact that there was no historic recorded value on the books of
        Go
        Agency for this asset.
  
 F
            -
            5
 
 **SIGN
        MEDIA SYSTEMS, INC.**
 **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)**
 **JUNE
        30, 2005 AND 2004**
 
 NOTE
        1
        -ORGANIZATION
        AND BASIS OF PRESENTATION (CONTINUED)
 
 On
        November 17, 2003, the Company entered into a merger agreement by and among
        American Powerhouse, Inc., a Delaware corporation and its wholly owned
        subsidiary, Sign Media Systems Acquisition Company, Inc., a Florida corporation
        and Signs Media Systems, Inc. Pursuant to the merger agreement, Signs Media
        Systems merged with Sign Media Systems Acquisition Company with Sign Media
        Systems being the surviving corporation. The merger was completed on December
        8,
        2003 with the filing of Articles of Merger with the State of Florida at which
        time Sign Media Systems Acquisition ceased to exist and Sign Media Systems
        became the surviving corporation. Some time prior to the merger, American
        Powerhouse had acquired certain technology for the manufacture of a water
        machine in the form of a water cooler that manufactures water from ambient
        air.
        However, American Powerhouse was not engaged in the business of manufacturing
        and distributing the water machine but was engaged in the licensing of that
        right to others. Prior to the merger, American Powerhouse granted a license
        to
        Sign Media Systems Acquisition to use that technology and to manufacture
        and
        sell the water machines. The acquisition of this license was the business
        purpose of this merger. As consideration for the merger, Sign Media Systems
        issued 300,000 shares of its common stock to American Powerhouse, 100,000
        shares
        in the year ending December 31, 2002, and 200,000 shares in the year ending
        December 31, 2004. The 300,000 shares of stock were valued at $1.50 per share
        based on recent private sales of Sign Media Systems common stock. There were
        no
        other material costs of the merger. There was and is no relationship between
        American Powerhouse and either Sign Media Systems or GO! AGENCY. The Company
        recorded this license as an intangible asset for $400,000 and subsequently
        impaired the entire amount.
 
 NOTE
        2
        -SUMMARY
        OF SIGNIFICANT ACCOUNTING POLICIES
 
 **Principles
        of Consolidation**
 
 The
        condensed consolidated financial statements include the accounts of the Company
        and its wholly owned subsidiary. All significant intercompany accounts and
        transactions have been eliminated in consolidation.
 
 
 
 F
            -
            6
 
  **SIGN
        MEDIA SYSTEMS, INC.**
 **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)**
 **JUNE
        30, 2005 AND 2004**
 
 NOTE
        2
        -SUMMARY
        OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
 
 **Use
        of Estimates**
 
 The
        preparation of condensed consolidated financial statements in conformity
        with
        accounting principles generally accepted in the United States of America
        requires management to make estimates and assumptions that affect the reported
        amounts of assets and liabilities and disclosures of contingent assets and
        liabilities at the date of the financial statements and the reported amounts
        of
        revenues and expenses during the reporting period. Actual results could differ
        from those estimates.
 
 **Revenue
        and Cost Recognition**
 
 Currently,
        the Company has three primary sources of revenue:
 
 (1)
              The
                  sale and installation of their mounting
                  system
 (2)
              The
                  printing of advertising images to be inserted on trucks utilizing
                  the
                  Company’s mounting systems.
 (3)
              Third
                  party advertising
 
 The
        Company’s revenue recognition policy for these sources of revenue is as follows.
        The Company relies on Staff Accounting Bulletin Topic 13, in determining
        when
        recognition of revenue occurs. There are four criteria that the Company must
        meet when determining when revenue is realized or realizable and earned.
        The
        Company has persuasive evidence of an arrangement existing; delivery has
        occurred or services rendered; the price is fixed or determinable; and
        collectibility is reasonably assured. Typically, the Company recognizes revenue
        when orders are placed and they receive deposits on those orders. In regard
        to
        the revenue recognition of third party advertising, the Company recognizes
        the
        revenue once they have completed the task for which the consumer
        paid.
 
 In
        addition, the Company offers manufacturer’s warranties. These warranties are
        provided by the Company and not sold. Therefore, no income is derived from
        the
        warranty itself.
 
 Cost
        is recorded on the accrual basis as well, when the services are incurred
        rather
        than when payment is made.
 
 Costs
        of goods sold are separated by components consistent with the revenue
        categories. Mounting systems, printing and advertising costs include purchases
        made, and payroll costs attributable to those components. Payroll costs is
        included for sales, engineering and warehouse personnel in cost of goods
        sold.
        Cost of overhead is diminimus. The Company’s inventory consists of finished
        goods, and unassembled parts that comprise the framework for the mounting
        system
        placed on trucks for their advertising. All of these costs are included in
        costs
        of goods sold for the six months ended June 30, 2005 and 2004.
 
 F
            -
            7
 
 **SIGN
        MEDIA SYSTEMS, INC.**
 **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)**
 **JUNE
        30, 2005 AND 2004**
 
 
 **NOTE
        2 -** **SUMMARY
        OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)**
 
 **Cash
        and Cash Equivalents**
 
 The
        Company considers all highly liquid debt instruments and other short-term
        investments with an initial maturity of three months or less to be cash
        equivalents.
 
 The
        Company maintains cash and cash equivalent balances at several financial
        institutions that are insured by the Federal Deposit Insurance Corporation
        up to
        $100,000.
 
 **Property
        and Equipment**
 
 Property
        and equipment are stated at cost. Depreciation is computed primarily using
        the
        straight-line method over the estimated useful life of the
        assets.
 Furniture
                    and fixtures
                5
                    yearsEquipment
                5
                    yearsTrucks
                5
                    years
 **Accounts
        Receivable**
 
 Management
        believes that all accounts receivable as of June 30, 2005 are fully collectible.
        Therefore, no allowance for doubtful accounts is recorded. The Company recovered
        $500,000 in the quarter ended June 30, 2005 that was previously recorded
        as an
        allowance for bad debt.
 
 **Advertising**
 
 Costs
        of advertising and marketing are expensed as incurred. Advertising and marketing
        costs were $1,800 and $3,020 for the six months ended June 30, 2005 and 2004,
        respectively
  **Fair
        Value of Financial Instruments**
  The
        carrying amount reported in the balance sheets for cash and cash equivalents,
        accounts receivable, accounts payable and accrued expenses approximate fair
        value because of the immediate or short-term maturity of these financial
        instruments.
  **Earnings
        per Share of Common Stock**
  Historical
        net income per common share is computed using the weighted-average number
        of
        common shares outstanding. Diluted earnings per share (EPS) include additional
        dilution from common stock equivalents, such as stock issuable pursuant to
        the
        exercise of stock options and warrants.
 
 F
            -
            8
 
 **SIGN
        MEDIA SYSTEMS, INC.**
 **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)**
 **JUNE
        30, 2005 AND 2004**
 
 **NOTE
        2 -** **SUMMARY
        OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)**
 
 **Earnings
        per Share of Common Stock (Continued)**
 
 The
        following is a reconciliation of the computation for basic and diluted
        EPS:
 **June
                    30,****2005**
                
                **2004**Net
                    income
                
                $
                594,581
                
                $
                231,261Weighted-average
                    common shares outstandingBasic
                
                
                8,460,000
                
                
                8,256,631Weighted-average
                    common stock equivalentsStock
                    options
                
                
                -
                
                
                -Warrants
                
                
                -
                
                
                -Weighted-average
                    common shares outstandingDiluted
                
                
                8,460,000
                
                
                8,256,631
 
  **NOTE
        3
        -**  **PROPERTY
        AND EQUIPMENT**
  Property
        and equipment consist of the following at June 30, 2005 and 2004:
 **2005**
                
                **2004**Equipment
                
                $
                104,234
                
                $
                71,634Furniture
                    and Fixtures
                
                
                112,022
                
                
                41,798Transportation
                    Equipment
                
                
                54,621
                
                
                54,621270,877
                
                
                168,053Less:
                    accumulated depreciation
                
                
                84,350
                
                
                34,484Net
                    Book Value
                
                $
                186,527
                
                $
                133,569
  Depreciation
        expense for the six months ended June 30, 2005 and 2004 was $24,941 and $16,715,
        respectively.
 
 
 
 F
            -
            9
 
 **SIGN
        MEDIA SYSTEMS, INC.**
 **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)**
 **JUNE
        30, 2005 AND 2004**
 
 **NOTE
        4
        -** **COMMITMENTS
        AND CONTINGENCIES**
  The
        Company entered into a lease agreement on November 1, 2002 with Hawkeye Real
        Estate, LLC, a related entity, to lease warehouse and office space. The lease
        expires on December 30, 2007, and provides that SMS pay all applicable sales
        and
        use tax, insurance and maintenance. The total minimum rental commitments
        at June
        30, 2005 under this lease are as follows:
 2005
                
                $
                30,0002006
                
                
                30,0002007
                
                
                15,000$
                75,000
  Rent
        expense for the six months ended June 30, 2005 and 2004 was $16,050, and
        $19,086, respectively.
 
 **NOTE
        5
        -** **RELATED
        PARTY TRANSACTIONS**
  On
        January 28, 2002, Sign Media Systems, Inc. was formed as a Florida Corporation
        but did not begin business operations until April 2002. Most of the revenue
        that
        Sign Media Systems, Inc. earned was contract work with Go! Agency, LLC.,
        a
        Florida limited liability company, a related party. Sign Media Systems, Inc.
        would contract Go! Agency, LLC. to handle and complete jobs. There was no
        additional revenue or expense added from one entity to the other.
 
 On
        January 3, 2003, the Company entered into a loan agreement with Olympus Leasing
        Company, a related party, and in connection therewith executed a promissory
        note
        with a future advance clause in favor of Olympus Leasing, whereby Olympus
        Leasing agreed to loan the Company up to a maximum of $1,000,000 for a period
        of
        three years, with interest accruing on the unpaid balance at 18% per annum,
        payable interest only monthly, with the entire unpaid balance due and payable
        in
        full on January 3, 2006. As of June 30, 2005 there was $0 due to Olympus.
        Other
        due to related party advances were $19,985. Due from related parties totaled
        $19,985 at June 30, 2005.
 
 On
        June 28, 2005, the Company loaned to Olympus Leasing Company, a related party,
        $1,200,000. The loan is for a period of five years with interest accruing
        on the
        unpaid balance at 5.3% per annum payable annually, with the entire principal
        and
        unpaid interest due and payable in full on June 28, 2010.
 F
            -
            10
 
  **SIGN
          MEDIA SYSTEMS, INC.** **NOTES
          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
          (CONTINUED)** **JUNE
          30, 2005 AND 2004**
  **NOTE
        6
        -** **LONG-TERM
        DEBT**
  Long-term
        debt consists of two installment notes with GMAC Finance. As discussed in
        Note
        1, the Company assumed debt from Go! Agency as of January 28, 2002. On June
        18,
        2003, the Company acquired a truck in the amount of $45,761 financed by GMAC
        over a period of 5 years. Monthly payments are $763. The loan carries no
        interest charges.
 
 
 **NOTE
        7-** **PROVISION
        FOR INCOME TAXES**
  The
        net deferred tax assets in the accompanying condensed consolidated balance
        sheets include the following components at June 30, 2005:
 Deferred
                    tax assets
                
                $
                10,000Deferred
                    tax valuation allowance
                
                
                (10,000
                )$
                -
  The
        Company will utilize its net operating losses to offset any Federal Income
        Tax
        due. The timing differences are approximately $33,000
 
 **NOTE
        8
        -**  **STOCKHOLDERS’
        EQUITY**
  As
        of June 30, 2005 and 2004, there were 100,000,000 shares of common stock
        authorized. As
        of June 30, 2005 and 2004, there were 8,460,000 shares of common stock issued
        and outstanding. During
        the six months ended June 30, 2005 the Company did not have any stock
        transactions.
 
 
 **NOTE
        9
        -** **LIABILITY
        FOR STOCK TO BE ISSUED**
 
 At
        June 30, 2005, the Company has recorded $224,900 for common stock to be issued
        at a later date. Upon the issuance of the common stock the liability will
        be
        removed.
 
  
 
 F
            -
            11
 
  **SIGN
          MEDIA SYSTEMS, INC.** **NOTES
          TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
          (CONTINUED)** **JUNE
          30, 2005 AND 2004**
  
 **NOTE
        10 -** **RESTATEMENT**
 
 The
        Company has restated its June 30, 2005 financial statements to reclassify
        $500,000 that was posted directly to additional paid-in capital that should
        have
        been posted as a recovery of bad debt.
 
 The
        effect of this restatement did not effect total stockholders equity. The
        effect
        did increase net income from $94,581 to $594,581 and earnings per share from
        .011 to .070.






F
          -
          12




**Item
      2. Management's Discussion and Analysis or Plan of
      Operation.**





THE
      FOLLOWING DISCUSSION OF THE FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF
      THE
      COMPANY SHOULD BE READ IN CONJUNCTION WITH THE FINANCIAL STATEMENTS AND NOTES
      THERETO INCLUDED ELSEWHERE IN THIS REPORT.





THIS
      DISCUSSION CONTAINS FORWARD-LOOKING STATEMENTS THAT INVOLVE RISKS AND
      UNCERTAINTIES, AND THE COMPANY'S ACTUAL RESULTS MAY DIFFER MATERIALLY FROM
      THOSE
      ANTICIPATED IN THESE FORWARD-LOOKING STATEMENTS AS A RESULT OF CERTAIN FACTORS,
      INCLUDING, BUT NOT LIMITED TO COMPETITION AND OVERALL MARKET AND ECONOMIC
      CONDITIONS.





RESULTS
      OF OPERATIONS





Six
      Months Ended


June
      30





**2005**
            
            **2004****(restated)**Revenue
            
            $
            511,385
            
            $
            654,484Cost
                of goods sold
            
            
            13,396
            
            
            94,260Gross
                profit
            
            
            497,989
            
            
            560,224Operating
                and other
              Expenses
            
            
            403,511
            
            
            328,963Other
                income
            
            
            500,103
            
            
            -Net
                income (loss)
            
            $
            594,581
            
            $
            231,261Gross
                profit margin
            
            
            97
            %
            
            86
            %Earnings
                per share
              of
                common stock
            
            $
            0.070
            
            $
            0.028Weighted
                average of
              common
                shares
            
            
            8,460,000
            
            
            8,256,621







The
      Company restated its June 30, 2005 financial statements to reclassify $500,000
      that was posted directly to additional paid-in capital that should have been
      posted as a recovery of bad debt. The effect of this restatement did not effect
      total stockholders equity. The effect did increase net income from $94,581
      to
      $594,581 and earnings per share from .011 to .070.





For
      the
      six months ended June 30, 2005, the Company generated $511,385 of revenue,
      $497,989 of gross profit, $500,103 in other income which included $500,000
      in
      recovery of bad debt expense, $594,581 of net income, and $0.070 in earnings
      per
      weighted average common share based
      upon a weighted average of 8,460,000 common shares outstanding.







For
      the
      six months ended June 30, 2004, the Company generated $654,484 of revenue,
      $560,224 of gross profit, $231,261 of net income, and $0.028 of net income
      per
      weighted common share based
      upon a weighted average of 8,256,631 common shares outstanding.






3







Revenue
      for the six months ended June 30, 2005, exclusive of recovery of bad debt
      expense, decreased $143,099 from the same period last year. Net income for
      the
      six months ended June 30, 2005, increased $363,320 from the same period last
      year primarily due to the recovery of bad debt expense. Earnings per share
      for
      the six months ended June 30,2005, increased $0.004 from the same period last
      year.





Cost
      of
      goods sold significantly decreased as a percentage of revenue during the six
      month ended June 30, 2005. This is primarily the result of two factors: (1)
      the
      Company has significantly reduced the cost of manufacturing its framing systems
      by significantly reducing the number of necessary parts and the cost of those
      parts, and (2) the Company acquired a grand format printer which significantly
      reduced the cost of its digital graphics.







Three
      Months Ended


June
      30





**2005**
            
            **2004****(restated)**Revenue
            
            $
            489,114
            
            $
            371,884Cost
                of goods sold
            
            
            10,889
            
            
            39,116Gross
                profit
            
            
            478,225
            
            
            332,768Operating
                and other
              Expenses
            
            
            213,443
            
            
            148,845Other
                income
            
            
            500,101
            
            
            -Net
                income (loss)
            
            $
            764,883
            
            $
            183,923Gross
                profit margin
            
            
            98
            %
            
            89
            %Earnings
                per share
              of
                common stock
            
            $
            0.090
            
            $
            0.022Weighted
                average of
              common
                shares
            
            
            8,460,000
            
            
            8,460,000







For
      the
      three months ended June 30, 2005, the Company generated $489,114 of revenue,
      $478,225 of gross profit, $500,101 of other income which included $500,000
      in
      recovery of bad debt expense, $764,883 of net income, and $0.090 in earnings
      per
      weighted average common share based upon a weighted average of 8,460,000 common
      shares outstanding.







For
      the
      three months ended June 30, 2004, the Company generated $371,884 of revenue,
      $332,768 of gross profit, $183,923 of net income, and $0.022 in earnings per
      weighted average common share based upon a weighted average of 8,460,000 common
      shares outstanding.





Revenue
      for the three months ended June 30, 2005, increased $117,230 from the same
      period last year. Net income for the three months ended June 30, 2005, increased
      $580,960 from the same period last year primarily due to recovery of bad debt
      expense. Earnings per share for the three months ended June 30,2005, increased
      $0.068 from the same period last year.





MANAGEMENT’S
      DISCUSSION





The
      Company is in the business of developing,
      manufacturing and marketing mobile billboard mounting systems which are mounted
      primarily on truck sides, rear panels and breaking panel roll up doors. The
      Company also produces digitally created outdoor, full color vinyl images which
      are inserted into the mounting systems and displayed primarily on trucks. The
      Company has developed mounting systems






4






which
      allow the digital images to easily slide into an aluminum alloy extrusion with
      a
      cam-lever that snaps closed stretching the image tight as a drum ,
      and
      that also easily opens to free the image for fast removals and change outs
      without damaging the truck body or the Fleet Graphics. The mounting systems’
      proprietary cam-lever technology is the key to their operation.









The
      Company’s revenue comes from three primary sources; sales of the mobile
      billboard mounting systems, sales of digital printing, and sales of third party
      advertising utilizing the mobile billboard mounting systems. During the six
      months ended June 30, 2005, $496,904. or 97% of the Company’s revenue came from
      the sale of its mobile billboard mounting systems, $0.00 or 00% of the Company’s
      revenue came from the sale of third party advertising and $15,281 or 3% of
      the
      Company’s revenue came from the sale of digital printing.







A
      material part of the Company’s business is currently dependent upon one key
      customer, Advanced Advertising Network, LLC of Lake Mary, Florida. During the
      six months ended June 30, 2005, the Company’s sales to this customer were
      approximately $485,816 or 95% of all sales. During the three months ended June
      30, 2005, the Company’s sales to this customer were approximately $459,768 or
      94% of all sales. The Company continues to rely on this customer for the
      majority of its sales. However, the Company is moving forward to expand its
      distribution base so that it will no longer depend on this one key customer.
      There can be no guarantee that the Company will be able to diversify its
      distribution base. Advanced Advertising Network, LLC is not a related
      party.







For
      the
      six months ended June 30, 2005, the Company attributes the increase in revenue,
      net income and earnings per share to increases in sales and the elimination
      of
      bad debt expense. The Company’s primary emphases is to expand sales nation wide
      and to also expand into Latin America by acquiring independent dealers.




On
      June
      28, 2005, the Company loaned , $1,200,000 to Olympus Leasing Company, a related
      party. The loan is for a period of fives year with interest accruing on the
      unpaid balance at 5.3% per annum payable annually, with the entire principal
      and
      unpaid interest due and payable in full on June 28, 2010. At
      June
      28, 2005, Antonio F. Uccello, III, was, and is today, the President, Chairman
      and owner of 45% of the issued and outstanding shares of stock of Olympus
      Leasing. Antonio F. Uccello, III, and was and is one of the Company’ officers
      and directors and an indirect shareholder of Sign Media Systems, Inc. Olympus
      Leasing is engaged in the business of providing commercial financing. Olympus
      Leasing has outstanding financing agreements with numerous other unrelated
      parties. The
      purpose of the loan was to obtain a higher interest rate than is currently
      available at traditional banking institutions. The Company does not anticipate
      that this loan will affect its ability to conduct its business.






Item
      3.
      Controls and Procedures.





(a)
      Evaluation of Disclosure Controls and Procedures





The
      term
      "disclosure controls and procedures" is defined in Rules 13a-15(e) and 15d-15(e)
      of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). This
      term refers to the controls and procedures of a company that are designed to
      ensure that information required to be disclosed by a company in the reports
      that it files under the Exchange Act is recorded, processed, summarized, and
      reported within the required time periods. Our Chief Executive Officer and
      our
      Chief Financial Officer have evaluated the effectiveness of our disclosure
      controls and procedures as of the end of the period covered by this annual
      report. They have concluded that, as of that date, our disclosure controls
      and
      procedures were effective at ensuring that required information will be
      disclosed on a timely basis in our reports filed under the Exchange
      Act.




5




(b)
      Changes in Internal Control over Financial Reporting





No
      change
      in our internal control over financial reporting (as defined in Rules 13a-15(f)
      and 15d-15(f) under the Exchange Act) occurred during the period covered by
      this
      report that has materially affected, or is reasonably likely to materially
      affect, our internal control over financial reporting.





**PART
      II — OTHER INFORMATION**





**Item
      1. Legal Proceedings.**





There
      are
      no pending or threatened legal proceedings against the Company or any of its
      subsidiaries.





**Item
      2. Changes in Securities.**





NONE





**Item
      3. Defaults Upon Senior Securities**





NONE





**Item
      4. Submission of Matters to a Vote of Security Holders.**





NONE





**Item
      5. Other Information.**





**Item
      6. Exhibits and Reports on Form 8-K.**







**INDEX
      TO EXHIBITS.**





**Exhibit
                Number**
            **Description
                of Exhibit****10.6**
            Promissory
                Note described in Part II, Item 5
                above**31.1**
            Certification
                of Chief Executive Officer pursuant to
                18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the
                Sarbanes-Oxley Act of 2002**31.2**
            Certification
                of Chief Financial 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 Chief Executive Officer and Chief
                Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted
                pursuant
                to Section 906 of the Sarbanes-Oxley Act of
                2002





The
      Company filed no Forms 8K for the quarter ended June 30, 2005.









6


**SIGNATURES**




In
      accordance with the requirements of the Exchange Act, the registrant caused
      this
      report to be signed on its behalf by the undersigned, thereunto duly authorized.




**SIGN
                MEDIA SYSTEMS, INC.**
              (Registrant)Date:October
                11, 2005
            /s/Antonio
                F. Uccello,
                III
              Antonio F. Uccello, III
              Chief Executive Officer
              Chairman of the Board







7