UNITED
      STATES


SECURITIES
      AND EXCHANGE COMMISSION


Washington,
      DC 20549





**FORM
      10-QSB/A**





[X]
            Quarterly
                Report purs,uant to Section 13 or 15(d) of the Securities Exchange
                Act of
                1934For
                the quarterly period endedDecember
                31, 2004[ 
                ]
            Transition
                Report pursuant to 13 or 15(d) of the Securities Exchange Act of
                1934For
                the transition period _________to
                _________Commission
                File Number:333-115444


MV
        Fund II, LLC
 (Exact
        name of small business issuer as specified in its charter)


Nevada(State
                        or other jurisdiction of incorporation or
                        organization)
                    20-0987069(IRS
                          Employer Identification
                          No.)


7311
                W. Charleston Blvd., Suite 110, Las Vegas, Nevada
                89117(Address
                of principal executive offices)





702-228-7105(Issuer’s
                telephone number)_______________________________________________________________(Former
                name, former address and former fiscal year, if changed since last
                report)








Check
      whether the issuer (1) filed all reports required to be filed by Section 13
      or
      15(d) of the Securities Exchange Act of 1934 during the preceding 12 months
      (or
      for such shorter period that the issuer was required to file such reports),
      and
      (2) has been subject to such filing requirements for the past 90 days [X] Yes
      [  ] No




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


0
      Units
      outstanding as of March 31, 2005





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





Table
          of Contents


**Explanatory
      Note**




The
      purpose of this amendment is to include the Company’s Restated Financial
      Statements for the quarter ended December 31, 2004.








TABLE
                OF CONTENTS
            PagePART
                I - FINANCIAL INFORMATIONItem
                1:
            Financial
                Statements
            3Item
                2:
            Plan
                of Operation
            4Item
                3:
            Controls
                and Procedures
            7PART
                II - OTHER INFORMATIONItem
                1:
            Legal
                Proceedings
            8Item
                2:
            Unregistered
                Sales of Equity Securities and Use of
                Proceeds
            8Item
                3:
            Defaults
                Upon Senior Securities
            8Item
                4:
            Submission
                of Matters to a Vote of Security
                Holders
            8Item
                5:
            Other
                Information
            8Item
                6:
            Exhibits
            8


2
 Table
          of Contents


**PART
      I - FINANCIAL INFORMATION**





**Item
      1.****Financial
      Statements**





Our
      unaudited financial statements included in this Form 10-QSB are as
      follows:





(a)
            Balance
                Sheet as of December 31, 2004.


(b)
            Statements
                of Operations for the three and six month periods ended December
                31, 2004,
                for periodfrom
                September 2, 2003 (Inception) to December 31, 2003, for period from
                September 2, 2003(Inception)
                to December 31, 2004;


(c)
            Statement
                of Changes in Member’s Equity for period from September 2, 2003
                (inception)to
                December 31, 2004


(d)
            Statements
                of Cash Flow for the six months ended December 31, 2004 and 2003;


(e)
            Notes
                to Financial Statements.





These
      unaudited financial statements have been prepared in accordance with accounting
      principles generally accepted in the United States of America for interim
      financial information and the SEC instructions to Form 10-QSB. In the opinion
      of
      management, all adjustments considered necessary for a fair presentation have
      been included. Operating results for the interim period ended December 31,
      2004
      are not necessarily indicative of the results that can be expected for the
      full
      year.




Table
          of Contents




**MV
      Fund II, LLC(a Development Stage Company)**


**Balance
      Sheet(Unaudited)**


December
                  31,2004(Restated)**Assets**Current
                  assets
              $
              -Total
                  assets
              $
              -**Liabilities
                  and Members' Equity**Current
                  liabilitiesAccrued
                  expenses
              $
              85,449Members'
                  (deficit) - no units issued at 12/31/04
              
              (85,449$
   The
        accompanying notes are an integral part of these financial
        statements.
   F-1
 Table
            of Contents
 **MV
          Fund II, LLC(a Development Stage Company)**
 **Statements
          of Operations(Unaudited)**
 Three
                    months endedDecember 31, 2004
                
                Three
                    months endedDecember 31, 2003
                
                Six
                    months endedDecember 31,2004
                
                September
                      2, 2003(Inception) to December 31, 2003
                
                September
                        2, 2003(Inception) toDecember 31,
                        2004(Restated)
                
                (Restated)
                
                (Restated)
                
                (Restated)
                
                (Restated)Net
                    Revenue
                
                $
                -
                
                $
                -
                
                $
                -
                
                $
                -
                
                $
                -Expenses:General
                    and administrative expenses
                
                
                31,469
                
                
                285
                
                
                71,560
                
                
                10,285
                
                
                105,242Total
                    expenses
                
                
                31,469
                
                
                285
                
                
                71,560
                
                
                10,285
                
                
                105,242Net
                    (loss)
                
                $
                (31,469)
                
                $
                (285)
                
                $
                (71,560)
                
                $
                (10,285)
                
                $
                (105,242)Net
                    (loss) allocated to members
                
                $
                (31,469)
                
                $
                (285)
                
                $
                (71,560)
                
                $
                (10,285)
                
                $
                (105,242)Weighted
                    average membership units
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -Net
                    (loss) allocated to members per
                    weighted
                      average membership units
                
                $
                -
                
                $
                -
                
                $I
                -
                
                $
                -
                
                $
                -
   The
          accompanying notes are an integral part of these financial
          statements.
  F-2
 Table
              of Contents
 **MV
              Fund II, LLC(a Development Stage Company)**
 **Statement
              of Changes in Members' Equity(Unaudited)**
 MemberUnits
                    
                    Additional
                          paid-in
                        capital
                    
                    (Deficit)AccumulatedDuringDevelopmentStage
                    
                    TotalMembers'(Deficit)September
                        2, 2003 (Inception)
                    
                    -
                    
                    $
                    -
                    
                    $
                    -
                    
                    $
                    -Managing
                        member donated capital
                    
                    
                    
                    
                    18,793
                    
                    
                    
                    
                    
                    18,793Net
                        loss for the period September 2, 2003thru
                        June 30, 2004 (Restated)
                    
                    
                    
                    
                    
                    
                    
                    (33,682)
                    
                    
                    (33,682)Balance,
                        June 30, 2004 (Restated)
                    
                    -
                    
                    
                    18,793
                    
                    
                    (33,682)
                    
                    
                    (14,889)Managing
                        member donated capital
                    
                    
                    
                    
                    1,000
                    
                    
                    
                    
                    
                    1,000Net
                        loss for the six monthsended
                        December 31, 2004 (Restated)
                    
                    
                    
                    
                    
                    
                    
                    (71,560)
                    
                    
                    (71,560)Balance,
                        December 31, 2004 (Restated)
                    
                    -
                    
                    $
                    19,793
                    
                    $
                    (105,242)
                    
                    $
                    (85,449)
   The
                accompanying notes are an integral part of these financial
                statements.
   F-3
 Table
                  of Contents
 **MV
                  Fund II, LLC(a Development Stage Company)**
 **Statements
                  of Cash Flows(Unaudited)**
 Six
                            months ended
                          December
                            31,
                          2004
                        
                        September
                                  2, 2003(Inception)
                                toDecember
                              31,2003
                        
                        September
                                  2, 2003(Inception)
                                toDecember
                              31,2004(Restated)
                        
                        (Restated)
                        
                        (Restated)**Cash
                            flows from operating activities**Net
                            (loss)
                        $
                        (71,560)
                        
                        $
                        (10,285)
                        
                        $
                        (105,242)Changes
                            in operating assets and liabilities:Increase
                            in accrued expenses
                        
                        70,560
                        
                        
                        285
                        
                        
                        85,449Net
                            cash (used) by operating activities
                        
                        (1,000)
                        
                        
                        (10,000)
                        
                        
                        (19,793)**Cash
                            flows from financing activities**Expenses
                            paid in capitalby
                            managing member
                        
                        1,000
                        
                        
                        10,000
                        
                        
                        19,793Net
                            cash provided by financing activities
                        
                        1,000
                        
                        
                        10,000
                        
                        
                        19,793Net
                            increase in cash
                        
                        -
                        
                        
                        -
                        
                        
                        -Cash
                            - beginning
                        
                        -
                        
                        
                        -
                        
                        
                        -Cash
                            - ending
                        $
                        -
                        
                        $
                        -
                        
                        $
                        -Non-cash
                            transactions:Expenses
                            paid for by the managing member
                        $
                        1,000
                        
                        $
                        10,000
                        
                        $
                        19,793Number
                            of membership units issued for expenses
                        
                        -
                        
                        
                        -
                        
                        
                        -
  The
                    accompanying notes are an integral part of these financial
                    statements.
    F-4
 Table
                      of Contents
 **MV
                  Fund II, LLC**(a Development Stage Company)
 Notes
                  to
                  Financial Statements(Unaudited)
 **NOTE
                    1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**
 
 Organization
 
 MV
                    Fund
                    II, LLC, a Nevada Limited Liability Company, (the Company) is
                    a development
                    stage company primarily engaged in investing in mortgage loans
                    on real estate.
                    The Company was organized on September 2, 2003 (date of inception)
                    and will
                    continue until August 27, 2047, unless dissolved prior or extended
                    thereto under
                    the provisions of the Operating Agreement.
 
 The
                    Manager of the Company is MV Funding Group, Inc. a Nevada corporation
                    engaged in
                    the investment business of mortgages, specifically the selection
                    and origination
                    of mortgages.
  For
                    the
                    period from September 2, 2003 (date of inception) through December
                    31, 2004, the
                    Company has not commenced its planned operations and the only
                    transactions were
                    costs associated with the offering (i.e., legal fees).
 
 The
                    fiscal year end of MV Fund II, LLC is June 30.
 
 Correction
                    of errors
 
 The
                    Company has restated its previously issued interim financial
                    statements for
                    matters related to the following previously reported items: deferred
                    offering
                    expenses, accrued expenses, paid in capital, organizational and
                    offering costs,
                    and net income. The accompanying financial statements for December
                    31, 2004 have
                    been restated to reflect the error corrections. The Company’s accumulated
                    (deficit) at December 31, 2004, was increased by $105,242 as
                    a result of prior
                    period error corrections.
 
 The
                    following is a summary of the restatement at December 31, 2004:
 2004Accumulated
                            (deficit) as previously reported
                        $
                        0Reductions
                            in previously reported items:Deferred
                            offering expense
                        
                        (10,000)Additions
                            in previously reported items:Accrued
                            expenses
                        
                        (75,449)Paid
                            in capital
                        
                        (19,793)Organizational
                            & offering costs
                        
                        105,242Total
                            addition to reported net (loss)
                        $
                        (105,242)Ending
                            balance of 2004 accumulated (deficit)
                        $
                        (105,242)
  The
                  effect the adjustments on the Company’s previously reported December 31, 2004
                  financial statements are incorporated as follows:
  F-5
 Table
                      of Contents
 **MV
                    Fund II, LLC**(a Development Stage Company)
 Notes
                    to
                    Financial Statements(Unaudited)
   **Balance
                              Sheet as of December 31, 2004**
                          *Previously
                              Reported*
                          
                          *Increase/
                              (Decrease)*
                          
                          *Restated*Current
                              Assets
                          $
                          10,000
                          
                          $
                          (10,000)
                          
                          $
                          -0-Other
                              Assets
                          
                          -0-
                          
                          
                          -0-
                          
                          
                          -0-Total
                              Assets
                          
                          10,000
                          
                          
                          (10,000)
                          
                          
                          -0-Current
                              Liabilities
                          
                          10,000
                          
                          
                          75,449
                          
                          
                          85,449Members'
                              (Deficit)Paid
                              in capital
                          
                          -0-
                          
                          
                          19,793
                          
                          
                          19,793Accumulated
                              (deficit)
                          
                          -0-
                          
                          
                          (105,242)
                          
                          
                          (105,242)Ending
                              Members’ (deficit)
                          
                          -0-
                          
                          
                          (85,449)
                          
                          
                          (85,449)Total
                              Liabilities and Members' (Deficit)
                          $
                          10,000
                          
                          $
                          (10,000)
                          
                          $
                          -0-**Statement
                              of Operations for the three**
                            **months
                              ended December 31, 2004**
                          
                          *Previously
                              Reported*
                          
                          
                          *Increase/
                              (Decrease)*
                          
                          
                          *Restated*Revenues
                          $
                          -0-
                          
                          $
                          -0-
                          
                          $
                          -0-Cost
                              of revenues
                          
                          -0-
                          
                          
                          -0-
                          
                          
                          -0-Gross
                              profit (loss)
                          
                          -0-
                          
                          
                          -0-
                          
                          
                          -0-General
                              & administrative expenses
                          
                          -0-
                          
                          
                          (31,469)
                          
                          
                          (31,469)Net
                              (loss)
                          $
                          -0-
                          
                          $
                          (31,469)
                          
                          $
                          (31,469)
 
 **Statement
                              of Operations for the six months ended December 31,
                              2004**
                          
                          *Previously
                              Reported*
                          
                          *Increase/
                              (Decrease)*
                          
                          *Restated*Revenues
                          
                          $
                          -0-
                          
                          $
                          -0-
                          
                          $
                          -0-Cost
                              of revenues
                          
                          
                          -0-
                          
                          
                          -0-
                          
                          
                          -0-Gross
                              profit (loss)
                          
                          
                          -0-
                          
                          
                          -0-
                          
                          
                          -0-General
                              & administrative expenses
                          
                          
                          -0-
                          
                          
                          (71,560)
                          
                          
                          (71,560)Net
                              (loss)
                          
                          $
                          -0-
                          
                          $
                          (71,560)
                          
                          $
                          (71,560)
 Estimates
 
 The
                    preparation of financial statements in conformity with generally
                    accepted
                    accounting principles requires management to make estimates and
                    assumptions that
                    affect the reported amounts of assets and liabilities and disclosure
                    of
                    contingent assets and liabilities at the date of the financial
                    statements and
                    the reported amounts of revenues and expenses during the reporting
                    period.
                    Actual results could differ from those estimates.
  F-6
 Table
                      of Contents
 **MV
                    Fund II, LLC**(a Development Stage Company)
 Notes
                    to
                    Financial Statements(Unaudited)
   Income
                    taxes
 
 Income
                    tax effects resulting from the Company's operations pass through
                    to the members
                    individually and, accordingly, no provision for income taxes
                    is included in the
                    financial statements.
 
 Revenue
                    recognition
 
 Interest
                    is recognized as revenue when earned according to the terms of
                    the loans, using
                    the effective interest method. The Company does not recognize
                    interest income on
                    loans once they are determined to be impaired. A loan is impaired
                    when based on
                    current information and events, it is probable that the Company
                    will be unable
                    to collect all amounts due according to the contractual terms
                    of the loan
                    agreement. Cash receipts will be allocated to interest income,
                    except when such
                    payments are specifically designated by the terms of the loan
                    as principal
                    reduction or when management does not believe the Company’s investment in the
                    loan is fully recoverable.
 
 Investments
                    in mortgage loans
 
 Investments
                    in mortgage loans are secured by trust deeds and mortgages. Such
                    investments in
                    mortgage loans may include commercial, construction, acquisition
                    and development
                    and land. Generally, all of the Company’s mortgage loans require interest only
                    payments with a balloon payment of the principal at maturity.
                    The Company has
                    both the intent and ability to hold mortgage loans until maturity
                    and therefore,
                    mortgage loans are classified and accounted for as held for investment
                    and are
                    carried at amortized cost. Periodically, the Company will evaluate
                    investments
                    in mortgage loans based upon loan to value ratios. Loan to value
                    ratios are
                    based on appraisals obtained at the time of loan origination
                    and may not reflect
                    subsequent changes in value estimates. Such appraisals, which
                    may be
                    commissioned by the borrower, are generally dated within 12 months of the
                    date of loan origination. The appraisals may be for the current
                    estimate of the
“as-if developed” value of the property, which approximates the
                    post-construction value of the collateralized property assuming
                    that such
                    property is developed. As-if developed values on raw land loans
                    or acquisition
                    and development loans often dramatically exceed the immediate
                    sales value and
                    may include anticipated zoning changes and timely successful
                    development by the
                    purchaser. As most of the appraisals will be prepared on an as-if
                    developed
                    basis, if a loan goes into default prior to any development of
                    a project, the
                    market value of the property may be substantially less than the
                    appraised value.
                    As a result, there may be less security than anticipated at the
                    time the loan
                    was originally made. If there is less security and a default
                    occurs, the Company
                    may not recover the full amount of the loan.
 
 Real
                    estate held for sale
 
 Upon
                    a
                    foreclosure of the underlying real property securing the investments
                    in mortgage
                    loans, the Company will reclassify such asset as investments
                    in real estate held
                    for sale. Investments in real estate held for sale are accounted
                    for at the
                    lower of cost or fair value less costs to sell with fair value
                    based on
                    appraisals and knowledge of local market conditions. It is not
                    the Company’s
                    intent to invest in or own real estate as a long-term investment.
                    The Company
                    seeks to sell properties acquired through foreclosure as quickly
                    as
                    circumstances permit. Any costs of managing, maintaining and
                    developing a real
                    property acquired through foreclosure shall be expensed in the
                    period such costs
                    are incurred. Gain/loss related to real estate held for sale
                    will be recognized
                    within the period of such sale assuming 25% or more of the sales
                    price has been
                    collected within the same period.
 
 Allowance
                    for loan losses
 
 Investments
                    in loans are carried at their principal amount outstanding less
                    any unearned
                    income or unamortized discount. Interest on loans is accrued
                    and credited to
                    interest income based on the daily principal amount outstanding.
                    Loans are
                    generally placed in nonaccrual status when principal or interest
                    is delinquent
                    for 30 days (unless adequately secured and in the process of
                    collection) or
                    circumstances
 F-7
 Table
                      of Contents
 **MV
                    Fund II, LLC**(a Development Stage Company)
 Notes
                    to
                    Financial Statements(Unaudited)
 indicate
                      that full collection of principal and interest is in doubt.
 The
                      Company maintains an allowance for loan losses on its investment
                      in mortgage
                      loans for estimated and expected credit impairment which is
                      considered inherent
                      to the Company’s investment in mortgage loans. The Manager’s estimate of
                      expected losses is based on a number of factors including the
                      types and dollar
                      amounts of loans in the portfolio, adverse situations that
                      may effect the
                      borrower’s ability to repay, prevailing economic conditions and the
                      underlying
                      collateral securing the loan. Typically, the Company will determine
                      the need for
                      an allowance for loan losses by comparing the dollar amount
                      of the loan with the
                      underlying collateral’s appraisal. Loans whose collateral has an “as if
                      developed” appraisal, the Company will assess the amount of the loan and
                      cost to
                      complete the real property and compare it with the “as if developed” appraisal
                      to determine if any allowance for loan losses is needed. Additions
                      to the
                      reserve are provided through a charge to earnings and are based
                      on an assessment
                      of certain factors including, but not limited to, estimated
                      losses on the loans.
                      Actual losses on loans are recorded as a charge-off or a reduction
                      to the
                      allowance for loan losses reserve. Subsequent recoveries of
                      amounts previously
                      charged off are added back to the reserve.
 
 Debt
                      securities
 
 The
                      Company will classify its debt securities as held-to-maturity,
                      as the Company
                      has the ability and the intent to hold the securities until
                      maturity. These
                      securities will be recorded at amortized cost, adjusted for
                      the amortization or
                      accretion of premiums or discounts. A decline in the market
                      value of any
                      held-to-maturity security below cost that is deemed to be other
                      than temporary
                      will result in a reduction in carrying amount to fair value.
                      The impairment
                      would be charged to earnings and a new cost basis for the security
                      would be
                      established. Premiums and discounts will be amortized or accreted
                      over the life
                      of the related security as an adjustment to yield using the
                      effective interest
                      method.
 
 Recent
                      accounting pronouncements
 
 In
                      July 2002, the FASB issued SFAS No. 146, “Accounting for Costs Associated with
                      Exit or Disposal Activities”, which addresses financial accounting and reporting
                      for costs associated with exit or disposal activities and supersedes
                      EITF No.
                      94-3, “Liability Recognition for Certain Employee Termination Benefits
                      and Other
                      Costs to Exit an Activity (including Certain Costs Incurred
                      in a
                      Restructuring).” SFAS No. 146 requires that a liability for a cost associated
                      with an exit or disposal activity be recognized when the liability
                      is incurred.
                      Under EITF No. 94-3, a liability for an exit cost was recognized
                      at the date of
                      an entity’s commitment to an exit plan. SFAS No. 146 also establishes
                      that the
                      liability should initially be measured and recorded at fair
                      value. The
                      provisions of SFAS No. 146 will be adopted for exit or disposal
                      activities that
                      are initiated after December 31, 2002.
 
 In
                      December 2002, the FASB issued SFAS No. 148, **“** Accounting
                      for Stock-Based Compensation—Transition and Disclosure—an amendment of SFAS No.
                      123.” This Statement amends SFAS No. 123, “Accounting for Stock-Based
                      Compensation” *,* to provide alternative methods of transition for a voluntary
                      change to the fair
                      value based method of accounting for stock-based employee compensation.
                      In
                      addition, this statement amends the disclosure requirements
                      of SFAS No. 123 to
                      require prominent disclosures in both annual and interim financial
                      statements
                      about the method of accounting for stock-based employee compensation
                      and the
                      effect of the method used on reported results. The adoption
                      of SFAS No. 148 is
                      not expected to have a material impact on the company’s financial position or
                      results of operations.
 
 In
                      November 2002, the FASB issued FASB Interpretation (“FIN”) No. 45, “Guarantors
                      Accounting and Disclosure Requirements for Guarantees, Including
                      Indirect
                      Guarantees and Indebtedness of Others” *,* an interpretation of FIN No. 5, 57 and 107, and rescission
                      of FIN No.
                      34, *“* Disclosure
                      of Indirect Guarantees of Indebtedness of Others” *.* FIN
                      45 elaborates on the disclosures to be made by the guarantor
                      in its interim and
                      annual financial statements about its obligations under certain
                      guarantees that
                      it has issued. It
 F-8
 Table
                        of Contents
 **MV
                      Fund II, LLC**(a Development Stage Company)
 Notes
                      to
                      Financial Statements(Unaudited)
 also
                      requires that a guarantor recognize, at the inception of a
                      guarantee, a
                      liability for the fair value of the obligation undertaken in
                      issuing the
                      guarantee. The initial recognition and measurement provisions
                      of this
                      interpretation are applicable on a prospective basis to guarantees
                      issued or
                      modified after December 31, 2002; while, the provisions of
                      the disclosure
                      requirements are effective for financial statements of interim
                      or annual periods
                      ending after December 15, 2002. The company believes that the
                      adoption of such
                      interpretation will not have a material impact on its financial
                      position or
                      results of operations and will adopt such interpretation during
                      fiscal year
                      2003, as required.
 
 In
                      January 2003, the FASB issued FIN No. 46, “Consolidation of Variable Interest
                      Entities” *,* an interpretation of Accounting Research Bulletin No. 51. FIN
                      No. 46 requires
                      that variable interest entities be consolidated by a company
                      if that company is
                      subject to a majority of the risk of loss from the variable
                      interest entity’s
                      activities or is entitled to receive a majority of the entity’s residual returns
                      or both. FIN No. 46 also requires disclosures about variable
                      interest entities
                      that companies are not required to consolidate but in which
                      a company has a
                      significant variable interest. The consolidation requirements
                      of FIN No. 46 will
                      apply immediately to variable interest entities created after
                      January 31, 2003.
                      The consolidation requirements will apply to entities established
                      prior to
                      January 31, 2003 in the first fiscal year or interim period
                      beginning after June
                      15, 2003. The disclosure requirements will apply in all financial
                      statements
                      issued after January 31, 2003. The company will begin to adopt
                      the provisions of
                      FIN No. 46 during the first quarter of fiscal 2003.
  **NOTE
                      2 - GOING CONCERN**
  As
                      shown
                      in the accompanying financial statements, the Company has accumulated
                      net losses
                      from operations totaling $105,242, and as of December 31, 2004,
                      has had no
                      revenue from operations. These factors raise substantial doubt
                      about the
                      Company’s ability to continue as a going concern.
  The
                      Company’s financial statements are prepared using the generally accepted
                      accounting principles applicable to a going concern, which
                      contemplates the
                      realization of assets and liquidation of liabilities in the
                      normal course of
                      business. However, the Company has generated no revenue from
                      its planned
                      principal operations. In order to obtain the necessary capital,
                      the Company
                      plans to begin operations with the receipt of a minimum investment
                      of membership
                      units and negotiating the purchase of the Fund’s first loans with this
                      investment. However, the Company is dependent upon its ability
                      to secure
                      financing, and there are no assurances that the Company will
                      be successful.
                      Without sufficient financing it would be unlikely for the Company
                      to continue as
                      a going concern. The accompanying financial statements do not
                      include any
                      adjustments that might be necessary if the Company is unable
                      to continue as a
                      going concern.
 
 **NOTE
                      3 - MEMBERS’ EQUITY**
 
 Membership
                      units
 
 The
                      Company is offering and selling to the public, up to a maximum
                      of 20,000
                      membership interests. The members shall contribute to the capital
                      of the Company
                      an amount equal to $2,500 for each unit subscribed for by each
                      member. The total
                      Capital contributions of the members will not exceed $50,000,000.
                      The Manager
                      shall be entitled to 4% of any capital contributions made by
                      members paid as an
                      organization fee.
 
 Allocations
                      and distributions
 
 In
                      accordance with the Operating Agreement, the Company's income,
                      gains and losses
                      are to be credited to and charged against each member in proportion
                      to their
                      respective capital accounts as of the close of business on
                      the last day of each
                      calendar month.
 F-9
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 **MV
                      Fund II, LLC**(a Development Stage Company)
 Notes
                      to
                      Financial Statements(Unaudited)
 Distributions
                      of net income are paid monthly in cash or as reinvested distributions.
                      Net
                      income available for distribution, as defined in the operating
                      agreement, is
                      cash flow less amounts set aside for restoration of reserves
                      during the month.
 
 Issuance
                      of membership units
 
 As
                      of
                      December 31, 2004, the Company has not issued any membership
                      units.
 
 **NOTE
                      4 - TRANSACTIONS WITH THE MANAGER AND ITS AFFILIATES**
 
 Fees
                      paid by the Company
 
 The
                      Managing Member shall be entitled to a 4% share of any capital
                      contributions
                      obtained from Members as provided by the Operating Agreement.
                      In addition, the
                      Managing Member shall be entitled to one quarter of one percent
                      (0.25%) of the
                      interest income generated by loans made by the Fund as noted
                      in Note 1 under
“Revenue recognition” as a management fee.
 
 The
                      Managing Member shall pay all expenses including but not limited
                      to, all
                      expenses incurred in the offering of Interests and any operating
                      expenses out of
                      its Organizational Fee and its Managing Membership Interest
                      Income.
 F-10
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            of Contents
  **Item
        2.     Plan of Operation**
 
 **Forward-Looking
        Statements**
  Historical
        results and trends should not be taken as indicative of future operations.
        Management’s statements contained in this report that are not historical facts
        are forward-looking statements within the meaning of Section 27A of the
        Securities Act of 1933, as amended, and Section 21E of the Securities and
        Exchange Act of 1934 (the “Exchange Act”), as amended. Actual results may differ
        materially from those included in the forward-looking statements. The Company
        intends such forward-looking statements to be covered by the safe-harbor
        provisions for forward-looking statements contained in the Private Securities
        Litigation Reform Act of 1995, and is including this statement for purposes
        of
        complying with those safe-harbor provisions. Forward-looking statements,
        which
        are based on certain assumptions and describe future plans, strategies and
        expectations of the Company, are generally identifiable by use of the
        words “believe,” “expect,” “intend,” “anticipate,” “estimate,” “project,”
“prospects,” or similar expressions. The Company’s ability to predict results or
        the actual effect of future plans or strategies is inherently uncertain.
        Factors
        which could have a material adverse affect on the operations and future
        prospects of the Company on a consolidated basis include, but are not limited
        to: changes in economic conditions, legislative/regulatory changes, availability
        of capital, interest rates, competition, and generally accepted accounting
        principles. These risks and uncertainties should be considered in evaluating
        forward-looking statements and undue reliance should not be placed on such
        statements. Further information concerning the Company and its business,
        including additional factors that could materially affect the Company’s
        financial results, is included herein and in the Company’s other filings with
        the SEC.
 
 **Plan
        of Operation**
 
 We
        were
        organized on September 2, 2003 and currently have no operational activities.
        The
        Fund will begin operations once we are capitalized and receive the minimum
        investment of securities registered with the Securities and Exchange Commission.
        Upon receiving this minimum, management anticipates distributing all funds
        held
        in a segregated account and negotiating the purchase of the Fund’s first loans.
        Management will be seeking to loan out all the funds assets from the start
        in
        order to maximize the potential Fund earnings. While, it is management’s
        preference to avoid larger loans in order to diversify risk, especially when
        its
        capital is limited as is likely during the start up of Fund operations, it
        does
        not expect to avoid larger loans as long as they offer the Fund a good
        investment opportunity and there is sufficient capital available to purchase
        the
        loan. However, investors should note that a larger loan would expose the
        fund to
        substantial credit risk, as a default by a single borrower could substantially
        reduce the fund’s assets.
 
 Management
        intends to begin with loans that have an upfront interest component of one
        year.
        Thus, there will be less need to hire staff to support the loans during this
        early period of operation. Management anticipates that its officers will
        be able
        to negotiate, purchase, process and manage all loans for the first six months
        following the initial funding. As new investment monies are received, management
        will actively seek to use these funds, net of the fees described herein,
        to
        purchase additional loans.
 
 Our
        primary business objective is to generate monthly income by investing in
        mortgage loans with the money we receive from this offering. We believe there
        is
        a significant market opportunity to make mortgage loans to owners and developers
        of real property whose financing needs are not met by traditional mortgage
        lenders. The loan underwriting standards that our Manager, MV Funding, utilizes
        will be less strict than traditional mortgage lenders. In addition, one of
        our
        competitive advantages is
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 expected
          to be our ability to approve loan applications more quickly than traditional
          lenders. As a result, in certain cases, we may make mortgage loans which
          are
          riskier than mortgage loans made by commercial banks. However, in return
          we will
          seek a higher interest rate and will take steps to mitigate the lending
          risks
          such as imposing a lower loan to value ratio. While we may assume more
          risk than
          traditional mortgage lenders, in return, we will seek to generate higher
          yields
          from our mortgage loans.
 Our
        operating results will be affected primarily by (i) the amount of capital
        we
        will have to invest in mortgage loans, (ii) the level of real estate lending
        activity in the markets we will service, (iii) our ability to identify and
        work
        with suitable borrowers, (iv) the interest rates we are able to charge on
        our
        loans and (v) the level of delinquencies, foreclosures and related loan losses
        which we experience. We expect to raise funds through the sale of our Membership
        interests and accordingly the size of our investment portfolio will be
        contingent upon the success of this offering.
  Adverse
        economic conditions during the next year could have a material impact on
        the
        collectibility of any loans we will make. Recognizing this risk, we will
        seek to
        maintain low loan to value ratios. In this manner, we will hope to maintain
        a
        sufficient cushion in the underlying equity position to protect the value
        of any
        loan in the event of a default. Nevertheless, there can be no assurance that
        a
        marked increase in loan defaults accompanied by a rapid decline in real estate
        values would have a material adverse effect upon our operating results when
        we
        commence operations.
  Because
        MV Funding’s officers have a significant degree of knowledge with respect to the
        real estate markets in Nevada and certain Western states, it is likely most
        of
        our loans will be concentrated in such states. Geographical concentration
        creates greater risk that any downturn in such local real estate markets
        could
        have a significant adverse effect upon our operating results when we commence
        operations. Commercial real estate markets in Nevada have continued to prosper,
        with significant borrowing activity.
  We
        expect
        to commence our operations when we receive financing from the sale of our
        membership interests in our equity offering.
  Significant
        Accounting Policies
 
 Income
        taxes
 
 Income
        tax effects resulting from the Company's operations pass through to the members
        individually and, accordingly, no provision for income taxes is included
        in the
        financial statements.
 
 Revenue
        recognition
 
 Interest
        is recognized as revenue when earned according to the terms of the loan.
        The
        Company does not recognize interest income on loans once they are determined
        to
        be impaired or non-performing. A loan is impaired when based on current
        information and events, it is probable that the Company will be unable to
        collect all amounts due according to the contractual terms of the loan
        agreement.
 
 Debt
        securities
 
 The
        Company will classify its debt securities as held-to-maturity, as the Company
        has the ability and the intent to hold the securities until maturity. These
        securities will be recorded at amortized cost, adjusted for the amortization
        or
        accretion of premiums or discounts. A decline in the market value of any
        held-to-maturity security below cost that is deemed to be other than temporary
        will result in a reduction in carrying amount to fair value. The impairment
        would be charged to earnings and a new cost basis for the security would
        be
        established. Premiums and discounts will be amortized or accreted over the
        life
        of the related security as an adjustment to yield using the effective interest
        method.
  5
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  Purchase
        mortgage loans
 
 The
        Company has both the intent and ability to hold mortgage loans until maturity
        and, therefore, mortgage loans are classified and accounted for as held for
        investment and are carried at cost. Interest income on loans is accrued by
        the
        effective interest method. The Company does not intend to purchase loans
        using
        forward purchase commitments.
 
 Investments
        in mortgage loans
 
 Investments
        in mortgage loans are secured by trust deeds and mortgages. Such investments
        in
        mortgage loans may include commercial, construction, acquisition and development
        and land. Generally, all of the Company’s mortgage loans require interest only
        payments with a balloon payment of the principal at maturity. The Company
        has
        both the intent and ability to hold mortgage loans until maturity and therefore,
        mortgage loans are classified and accounted for as held for investment and
        are
        carried at amortized cost. Periodically, the Company will evaluate investments
        in mortgage loans based upon loan to value ratios. Loan to value ratios are
        based on appraisals obtained at the time of loan origination and may not
        reflect
        subsequent changes in value estimates. Such appraisals, which may be
        commissioned by the borrower, are generally dated within 12 months of the
        date of loan origination. The appraisals may be for the current estimate
        of the
“as-if developed” value of the property, which approximates the
        post-construction value of the collateralized property assuming that such
        property is developed. As-if developed values on raw land loans or acquisition
        and development loans often dramatically exceed the immediate sales value
        and
        may include anticipated zoning changes and timely successful development
        by the
        purchaser. As most of the appraisals will be prepared on an as-if developed
        basis, if a loan goes into default prior to any development of a project,
        the
        market value of the property may be substantially less than the appraised
        value.
        As a result, there may be less security than anticipated at the time the
        loan
        was originally made. If there is less security and a default occurs, the
        Company
        may not recover the full amount of the loan.
 
 Real
        estate held for sale
 
 Upon
        a
        foreclosure of the underlying real property securing the investments in mortgage
        loans, the Company will reclassify such asset as investments in real estate
        held
        for sale. Investments in real estate held for sale are accounted for at the
        lower of cost or fair value less costs to sell with fair value based on
        appraisals and knowledge of local market conditions. It is not the Company’s
        intent to invest in or own real estate as a long-term investment. The Company
        seeks to sell properties acquired through foreclosure as quickly as
        circumstances permit. Any costs of managing, maintaining and developing a
        real
        property acquired through foreclosure shall be expensed in the period such
        costs
        are incurred. Gain/loss related to real estate held for sale will be recognize
        within the period of such sale assuming 25% or more of the sales price has
        been
        collected within the same period.
 
 Allowance
        for loan losses
 
 Investments
        in loans are carried at their principal amount outstanding less any unearned
        income or unamortized discount. Interest on loans is accrued and credited
        to
        interest income based on the daily principal amount outstanding. Loans are
        generally placed in nonaccrual status when principal or interest is delinquent
        for 30 days (unless adequately secured and in the process of collection)
        or
        circumstances indicate that full collection of principal and interest is
        in
        doubt.
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 Table
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  **Item
        3.     Controls and Procedures**
 
 We
        carried out an evaluation of the effectiveness of the design and operation
        of
        our disclosure controls and procedures (as defined in Exchange Act Rules
        13a-15(e) and 15d-15(e)) as of December 31, 2004. This evaluation was carried
        out under the supervision and with the participation of the Chief Executive
        Officer (“CEO”) and the Chief Financial Officer (“CFO”) of MV Funding Group,
        Inc., the Company’s Manager, who function as the equivalent of the CEO and CFO
        of the Company. Based upon such evaluation, the Manager’s CEO and CFO have
        concluded that, as of the Evaluation Date, the Company’s disclosure controls and
        procedures were effective. There have been no significant changes in our
        internal controls over financial reporting during the quarter ended December
        31,
        2004 that have materially affected or are reasonably likely to materially
        affect
        such controls.
 
 Disclosure
        controls and procedures are controls and other procedures that are designed
        to
        ensure that information required to be disclosed in our reports filed or
        submitted under the Exchange Act are recorded, processed, summarized and
        reported, within the time periods specified in the SEC's rules and forms.
        Disclosure controls and procedures include, without limitation, controls
        and
        procedures designed to ensure that information required to be disclosed in
        our
        reports filed under the Exchange Act is accumulated and communicated to
        management, including our Chief Executive Officer and Chief Financial Officer,
        to allow timely decisions regarding required disclosure.
 
 Limitations
        on the Effectiveness of Internal Controls
 
 Our
        management does not expect that our disclosure controls and procedures or
        our
        internal control over financial reporting will necessarily prevent all fraud
        and
        material error. An internal control system, no matter how well conceived
        and
        operated, can provide only reasonable, not absolute, assurance that the
        objectives of the control system are met. Further, the design of a control
        system must reflect the fact that there are resource constraints, and the
        benefits of controls must be considered relative to their costs. Because
        of the
        inherent limitations in all control systems, no evaluation of controls can
        provide absolute assurance that all control issues and instances of fraud,
        if
        any, within the Company have been detected. These inherent limitations include
        the realities that judgments in decision-making can be faulty, and that
        breakdowns can occur because of simple error or mistake. Additionally, controls
        can be circumvented by the individual acts of some persons, by collusion
        of two
        or more people, or by management override of the internal control. The design
        of
        any system of controls also is based in part upon certain assumptions about
        the
        likelihood of future events, and there can be no assurance that any design
        will
        succeed in achieving its stated goals under all potential future conditions.
        Over time, control may become inadequate because of changes in conditions,
        or
        the degree of compliance with the policies or procedures may deteriorate.
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 **PART
        II - OTHER INFORMATION**
 
 **Item
        1.     Legal
        Proceedings**
 
 None
 
 **Item
        2.     Unregistered Sales of Equity
        Securities and Use of Proceeds**
 
 Subsequent
        to the reporting period on January 25, 2005, the registration statement filed
        on
        Form S-1 (Commission file number 333-115444) was declared effective. This
        offering has commenced and is ongoing.
 
 **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**
 
 **Exhibit
                  Number**
              **Description
                  of Exhibit**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 200231.2
              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 200232.1
              Certification
                  of Chief Executive Officer pursuant to 18
                  U.S.C. Section 1350, as adopted pursuant to Section 906 of the
                  Sarbanes-Oxley Act of 2002
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  **SIGNATURES**
 
 In
        accordance with the requirements of the Securities and Exchange Act of 1934,
        the
        Registrant has duly caused this report to be signed on its behalf by the
        undersigned, thereunto duly authorized.
 
 **MV
                  Fund II, LLC****By:
                  MV Funding Group, Inc., its sole manager**Date:
              December
                  30, 2005/s/ Sam Medley
                By:       _______________________
                Sam
                  Medley
                Title:****Chief
                  Executive Officer of MV Funding Group, Inc.,
                sole
                  Manager of MV Fund II, LLC