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UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C.
20549

Form 10-Q

(Mark One)

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

For the quarterly period ended August 31, 2009

or

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

For the transition period from ____________________ to ____________________

Commission File Number 333-150110

Future Canada China Environment
Inc.(Exact name of registrant as specified in its
charter)

|Nevada                                                               | 71-1046264                       
|-------------------------------------------------------------------- | ---------------------------------
|(State or other jurisdiction of incorporation or
      organization) | (IRS Employer Identification No.)
|                                                                     |                                  
|114 West Magnolia Street, Suite 437, Bellingham,
      Washington    | 98225                            
|(Address of principal executive offices)                             | (Zip Code)                       

360.392.2828(Registrants telephone number,
including area code)

N/A(Former name, former address and former
fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has 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
registrant 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 large
accelerated filer, an accelerated filer, a non-accelerated filer, or a small
reporting company. See the definitions of large accelerated filer,
accelerated filer and smaller reporting company in Rule 12b-2 of the
Exchange Act

|Large accelerated filer [ ] |                                                     | Accelerated filer [ ]          
|--------------------------- | --------------------------------------------------- | -------------------------------
|Non-accelerated filer [ ]   | (Do not check if a smaller
      reporting company) | Smaller reporting company [ X ]

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

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEDING FIVE YEARS

Check whether the registrant has filed all documents and reports
required to be filed by Sections 12, 13 or 15(d) of the Exchange Act after the
distribution of securities under a plan confirmed by a court.[ ] YES [ ]
NO

Indicate by check mark whether the registrant has submitted
electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation
S-T (§232.405 of this chapter) during the preceding 12 months (or for such
shorter period that the registrant was required to submit and post such
files).[ ] YES [ ] NO

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuers
  classes of common stock, as of the latest practicable date. 38,665,200 common
  shares issued and outstanding as of October 9, 2009

1

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PART 1  FINANCIAL INFORMATION

Item 1. Financial Statements.

Our unaudited interim financial statements for the three month
period ended August 31, 2009 form part of this quarterly report. They are stated
in United States Dollars (US$) and are prepared in accordance with United States
generally accepted accounting principles.

2

---

|Future Canada China Environment, Inc.
|-------------------------------------
|(A Development Stage Company)        
|Balance
      Sheets                 

|                                                                         |   | As of           |  
|------------------------------------------------------------------------ | - | --------------- | -
|                                                                         |   | August 31, 2009 |  
|                                                                         |   | (Unaudited)     |  
|ASSETS                                                                   |   |                 |  
|                                                                         |   |                 |  
|Current assets                                                           |   |                 |  
|Cash                                                                     | $ | 7,481           |  
|Prepaid expenses                                                         |   | 10,750          |  
|Total current assets                                                     |   | 18,231          |  
|                                                                         |   |                 |  
|Other assets                                                             |   |                 |  
|Deposits                                                                 |   | 495             |  
|                                                                         |   |                 |  
|Total assets                                                             | $ | 18,726          |  
|                                                                         |   |                 |  
|LIABILITIES AND STOCKHOLDERS'
      DEFICIT                              |   |                 |  
|                                                                         |   |                 |  
|Current liabilities                                                      |   |                 |  
|Accounts Payable                                                         | $ | 72,300          |  
|Accounts Payable  related party                                         |   | 86,807          |  
|Due to Related Party                                                     |   | 150,352         |  
|                                                                         |   |                 |  
|Total liabilities                                                        |   | 309,459         |  
|                                                                         |   |                 |  
|Stockholders deficit (See Note 4)                                       |   |                 |  
|Preferred stock; $0.00001 par value;
      100,000,000 shares authorized |   |                 |  
|no shares issued and outstanding                                         |   |                 |  
|as of August 31, 2009 and
      February 29, 2008                        |   | --              |  
|Common stock; $0.00001 par value; 100,000,000 shares
      authorized    |   |                 |  
|38,665,200 shares issued and
      outstanding                           |   |                 |  
|as of August 31, 2009 and February 29, 2008                              |   | 387             |  
|Additional paid in capital                                               |   | 152,695         |  
|Accumulated deficit during development stage                             |   | (443,815        | )
|                                                                         |   |                 |  
|Total stockholders deficit                                              |   | (290,733        | )
|                                                                         |   |                 |  
|                                                                         |   |                 |  
|Total liabilities and stockholders deficit                              | $ | 18,726          |  

---

|Future Canada China Environment, Inc.   
|----------------------------------------
|(A Development Stage Company)           
|Statement of
      Operations--Unaudited

|                                    |   |                      |   |   |                    |   |   |            |   |   |           |   |   | Inception    |  
|----------------------------------- | - | -------------------- | - | - | ------------------ | - | - | ---------- | - | - | --------- | - | - | ------------ | -
|                                    |   |                      |   |   |                    |   |   |            |   |   |           |   |   | (February 5, |  
|                                    |   | For the three months |   |   | For the six months |   |   | **2008)**  |  
|                                    |   | ended                |   |   | ended              |   |   | through    |  
|                                    |   | 31-Aug-09            |   |   | 31-Aug-08          |   |   | 31-Aug-09  |   |   | 31-Aug-08 |   |   | 31-Aug-09    |  
|                                    |   |                      |   |   |                    |   |   |            |   |   |           |   |   |              |  
|Revenues                            | $ | -                    |   | $ | -                  |   | $ | -          |   | $ | -         |   | $ | -            |  
|                                    |   |                      |   |   |                    |   |   |            |   |   |           |   |   |              |  
|Cost of revenue                     |   | -                    |   |   | -                  |   |   | -          |   |   | -         |   |   | -            |  
|                                    |   |                      |   |   |                    |   |   |            |   |   |           |   |   |              |  
|Gross profit                        |   | -                    |   |   | -                  |   |   | -          |   |   | -         |   |   | -            |  
|                                    |   |                      |   |   |                    |   |   |            |   |   |           |   |   |              |  
|Operating expenses                  |   |                      |   |   |                    |   |   |            |   |   |           |   |   |              |  
|Selling, general and administrative |   | 125,624              |   |   | 28,796             |   |   | 233,873    |   |   | 64,017    |   |   | 495,315      |  
|Total Expenses                      |   | 125,624              |   |   | 28,796             |   |   | 233,873    |   |   | 64,017    |   |   | 495,015      |  
|                                    |   |                      |   |   |                    |   |   |            |   |   |           |   |   |              |  
|Other income                        |   |                      |   |   |                    |   |   |            |   |   |           |   |   |              |  
|Debt forgiven by related party      |   | -                    |   |   | -                  |   |   | 1,643      |   |   | -         |   |   | 51,500       |  
|                                    |   |                      |   |   |                    |   |   |            |   |   |           |   |   |              |  
|Loss from operations                | $ | (125,624             | ) | $ | (28,796            | ) | $ | (232,230   | ) | $ | (64,017   | ) | $ | (443,515     | )
|                                    |   |                      |   |   |                    |   |   |            |   |   |           |   |   |              |  
|Basic and diluted net loss per      |   |                      |   |   |                    |   |   |            |   |   |           |   |   |              |  
|common share:                       | $ | (0.00                | ) | $ | (0.01              | ) | $ | (0.01      | ) | $ | (0.01     | ) |   |              |  
|                                    |   |                      |   |   |                    |   |   |            |   |   |           |   |   |              |  
|Weighted average common shares      |   |                      |   |   |                    |   |   |            |   |   |           |   |   |              |  
|outstanding                         |   | 38,665,200           |   |   | 5,278,874          |   |   | 38,665,200 |   |   | 5,139,437 |   |   |              |  

---

|Future Canada China Environment, Inc.                     
|----------------------------------------------------------
|(A Development Stage Company)                             
|Statement of Stockholders' Deficit--Unaudited             
|From Inception
      (February 5, 2008) to August 31, 2009

|                            |  |              |  |   |                 |  |  |         |  |   |             |  |   |               |  |   | Accumulated |   |   |          |  
|--------------------------- |  | ------------ |  | - | --------------- |  |  | ------- |  | - | ----------- |  | - | ------------- |  | - | ----------- | - | - | -------- | -
|                            |  |              |  |   |                 |  |  |         |  |   |             |  |   |               |  |   | Deficit     |   |   |          |  
|                            |  |              |  |   |                 |  |  |         |  |   |             |  |   | Additional    |  |   | During      |   |   | Total    |  
|                            |  | Common Stock |  |   | Preferred Stock |  |  | Paid-in |  |   | Development |  |   | Stockholders | 
|                            |  | Shares       |  |   | Amount          |  |  | Shares  |  |   | Amount      |  |   | Capital       |  |   | Stage       |   |   | Deficit  |  
|Balances, February 5, 2008  |  | -            |  | $ | -               |  |  | -       |  | $ | -           |  | $ | -             |  | $ | -           |   | $ | -        |  
|(Date of inception)         |  |              |  |   |                 |  |  |         |  |   |             |  |   |               |  |   |             |   |   |          |  
|Issuance of stock for cash, |  |              |  |   |                 |  |  |         |  |   |             |  |   |               |  |   |             |   |   |          |  
|$0.00001 per share          |  | 35,000,000   |  |   | 350             |  |  | -       |  |   | -           |  |   | -             |  |   | (300        | ) |   | 50       |  
|Net loss                    |  | -            |  |   | -               |  |  | -       |  |   | -           |  |   | -             |  |   | (45,343     | ) |   | (45,343  | )
|Balances, February 29, 2008 |  | 35,000,000   |  |   | -               |  |  | -       |  |   | -           |  |   | -             |  |   | (45,643     | ) |   | (45,293  | )
|Issuance of stock for cash, |  |              |  |   |                 |  |  |         |  |   |             |  |   |               |  |   |             |   |   |          |  
|$0.0285 per share           |  | 3,665,200    |  |   | 37              |  |  | -       |  |   | -           |  |   | 104,683       |  |   | -           |   |   | 104,720  |  
|Net loss                    |  | -            |  |   | -               |  |  | -       |  |   | -           |  |   | -             |  |   | (165,942    | ) |   | (165,942 | )
|Balances, February 29, 2009 |  | 38,665,200   |  |   | 387             |  |  | -       |  |   | -           |  |   | 104,683       |  |   | (211,585    | ) |   | (106,515 | )
|Issuance of stock option    |  | -            |  |   | -               |  |  | -       |  |   | -           |  |   | 48,012        |  |   | -           |   |   | 48,012   |  
|Net loss for the period     |  | -            |  |   | -               |  |  | -       |  |   | -           |  |   | -             |  |   | (232,230    | ) |   | (232,230 | )
|Balances, August 31, 2009   |  | 38,665,200   |  | $ | 387             |  |  | -       |  | $ | -           |  | $ | 152,695       |  | $ | (443,815    | ) | $ | (290,733 | )

---

|Future Canada China Environment, Inc.   
|----------------------------------------
|(A Development Stage Company)           
|Statement of
      Cash Flows--Unaudited

|                                                                        |   |                    |   |   |           |   |   | Inception    |  
|----------------------------------------------------------------------- | - | ------------------ | - | - | --------- | - | - | ------------ | -
|                                                                        |   |                    |   |   |           |   |   | (February 5, |  
|                                                                        |   | For the six months |   |   | **2008)** |  
|                                                                        |   | ended              |   |   | through   |  
|                                                                        |   | 31-Aug-09          |   |   | 31-Aug-08 |   |   | 31-Aug-09    |  
|Cash flows from operating activities                                    |   |                    |   |   |           |   |   |              |  
|Net loss                                                                | $ | (232,230           | ) | $ | (64,017   | ) | $ | (443,515     | )
|Adjustments to reconcile net loss to
      net cash used in operations: |   |                    |   |   |           |   |   |              |  
|Consulting expenses  non cash                                          |   | 38,750             |   |   | -         |   |   | 53,606       |  
|Debt forgiveness                                                        |   | (1,643             | ) |   | -         |   |   | (51,500      | )
|Stock compensation expense                                              |   | 48,012             |   |   | -         |   |   | 48,012       |  
|                                                                        |   |                    |   |   |           |   |   |              |  
|Changes in assets and liabilities:                                      |   |                    |   |   |           |   |   |              |  
|(Increase)/decrease in deposits                                         |   | 100                |   |   | -         |   |   | (495         | )
|(Increase)/decrease in prepaid expenses                                 |   | -                  |   |   | (15,000   | ) |   | (10,000      | )
|Increase/(decrease) in accounts
      payable                           |   | 40,403             |   |   | -         |   |   | 72,300       |  
|Increase/(decrease) in accounts payable  related
      party           |   | 44,000             |   |   | 5,000     |   |   | 86,807       |  
|Net cash used by
      operating activities                             |   | (62,608            | ) |   | (74,017   | ) |   | (244,785     | )
|                                                                        |   |                    |   |   |           |   |   |              |  
|Cash flows from financing activities                                    |   |                    |   |   |           |   |   |              |  
|Proceeds from issuance of common stock                                  |   | -                  |   |   | 104,720   |   |   | 104,770      |  
|Proceeds from related party                                             |   | 50,418             |   |   | -         |   |   | 204,996      |  
|Payments to related party                                               |   | (57,500            | ) |   | -         |   |   | (57,500      | )
|Net cash provided by
      (used in) financing activities               |   | (7,082             | ) |   | 74,052    |   |   | 252,266      |  
|                                                                        |   |                    |   |   |           |   |   |              |  
|Net change in cash                                                      |   | (69,690            | ) |   | 35        |   |   | 7,481        |  
|                                                                        |   |                    |   |   |           |   |   |              |  
|Cash, beginning of period                                               |   | 77,171             |   |   | 50        |   |   | -            |  
|                                                                        |   |                    |   |   |           |   |   |              |  
|Cash, end of period                                                     | $ | 7,481              |   | $ | 85        |   | $ | 7,481        |  
|                                                                        |   |                    |   |   |           |   |   |              |  
|Supplemental disclosure                                                 |   |                    |   |   |           |   |   |              |  
|Non cash stock compensation expenses                                    | $ | 48,012             |   | $ | -         |   | $ | 48,012       |  
|Non cash prepaid consulting
      services                              | $ | 4,500              |   | $ | -         |   | $ | 39,500       |  
|Non cash due to related party                                           | $ | 2,857              |   | $ | -         |   | $ | 2,857        |  

---

|Future Canada China Environment Inc.
|------------------------------------
|(A Development Stage Company)       
|Notes to Financial Statements       
|August 31, 2009                     
|(Unaudited)                         

|Note 1 | Nature of Operations
|------ | --------------------

The Company was incorporated on
February 5, 2008 under the law of Nevada, United States of America. It is a
consulting company, and accordingly, its principal purpose is to use its capital
to investigate and find a business to acquire.

The Company is currently in the
development stage as defined in SFAS No. 7. All activities of the Company to
date relate to the organizations initial funding and share issuances.

Going Concern

The accompanying financial statements
have been prepared in conformity with generally accepted accounting principles,
which contemplate continuation of the Company as a going concern. The Company
has not begun generating revenue, is considered a development stage company, has
experienced recurring net operating losses, had an accumulated deficit of
($443,815) and had a working capital deficit of ($291,228) as of August 31,
2009. These factors raise substantial doubt about the Companys ability to
continue as a going concern. Management plans to issue more shares of common
stock in order to raise funds. The Company will seek additional sources of
capital through the issuance of debt or equity financing, but there can be no
assurance the Company will be successful in accomplishing its objectives.

These financials do not include any
adjustments relating to the recoverability and reclassification of recorded
asset amounts, or amounts and classifications of liabilities that might result
from this uncertainty.

|Note 2 | Significant Accounting Policies
|------ | -------------------------------

(a) Basis of presentation

The financial statements have been
prepared in accordance with accounting principles generally accepted in the
United States. In the opinion of management, all adjustments, consisting of
normal recurring accruals considered necessary for a fair presentation, have
been included. Operating results for the three months ended August 31, 2009 are
not necessarily indicative of the results that may be expected for the year
ending February 28, 2010. For further information, refer to the financial
statements and footnotes thereto included in the Form 10-K for the year ended
February 28, 2009.

(b) Reclassification

Certain reclassifications, having no
effect on net loss, have been made to the previously issued financial statements
to conform to the current periods presentation of the Companys financial
statements. Reclassifications were made between accounts payable  related party
and due to related party.

---

|Future Canada China Environment Inc.
|------------------------------------
|(A Development Stage Company)       
|Notes to Financial Statements       
|August 31, 2009                     
|(Unaudited)                         

|Note 2 | Significant Accounting Policies
      (Continued)
|------ | -------------------------------------------------

(c) Use of estimates

The preparation of financial
statements in conformity with U.S. Generally Accepted Accounting Principles
requires management to make estimates and assumptions that affect 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
revenue and expense during the reporting period. Actual results could differ
from those estimates and may impact future results of operations and cash
flows.

(d) Cash and cash equivalents

For the purposes of the statement of
cash flows, the Company considers highly liquid financial instruments purchased
with maturities of three months or less to be cash equivalents.

(e) Income Taxes

The Company accounts for its income
taxes in accordance with Statement of Financial Accounting Standards No. 109,
which requires recognition of deferred tax assets and liabilities for future tax
consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases and tax credit carry-forwards. Deferred tax assets and liabilities are
measured using enacted tax rates expected to apply to taxable income in the
years in which those temporary differences are expected to be recovered or
settled. The effect on deferred tax assets and liabilities or a change in tax
rate is recognized in income in the period that includes the enactment date.

(f) Fair value of financial
instruments

Financial accounting standards
statement No. 107 Disclosure about Fair Value of Financial Instruments,
requires the Company to disclose, when reasonably attainable, the fair market
value of its assets and liabilities which are deemed to be financial
instruments. The carrying amount and estimated fair values of the Companys
financial instruments approximated their fair value due to their short-term
nature.

(g) Loss per share

The Company computes net loss per
share in accordance with SFAS No. 128, Earnings per Share (SFAS 128) and SEC
Staff Accounting Bulletin No. 98 (SAB 98). Under the provisions of SFAS 128 and
SAB 98, basic net loss per share is computed by dividing the net loss available
to common stockholders for the period by the weighted average number of shares
of common stock outstanding during the period.

Diluted loss per share is computed
using the weighted average number of shares and dilutive potential common shares
outstanding. Potentially dilutive common shares consist of employee stock
options, warrants, and restricted stock, and are excluded from the diluted
earnings per share computation in periods where the Company has incurred a net
loss.

---

|Future Canada China Environment Inc.
|------------------------------------
|(A Development Stage Company)       
|Notes to Financial Statements       
|August 31, 2009                     
|(Unaudited)                         

|Note 3 | Initial Public Offering
|------ | -----------------------

On April 24, 2008, Form S-1
registration statement was declared effective by the SEC. Pursuant to the S-1,
the Company offered 3,500,000 (post split-up in the form of a dividend) (post
split-up) shares minimum, 7,000,000 (post split-up) shares maximum at an
offering price of $0.0285 per share in a direct public offering, without any
involvement of underwriters or broker-dealers. As of August 31, 2009, the
Company had sold 3,665,200 (post split-up) shares of common stock and raised
$104,720. The Company is currently listed on the Over the Counter Bulletin Board
(OTCBB).

|Note 4 | Share Capital
|------ | -------------

The Company has 100,000,000 common
shares authorized with a par value of US $0.00001 per share and 100,000,000
preferred shares. In February 2008, in connection with its organization, the
Company issued 35,000,000 (post split-up) restricted shares of their authorized
common stock. The shares were issued for cash of $50.00. The Company completed
its initial public stock offering during the prior year ended February 28, 2009
and raised $104,720 through issuance of 3,665,200 (post split-up) shares of
registered common stock. In addition, on October 9, 2008, the Company issued a
split-up in the form of a dividend on the basis of 6 additional shares of common
stock for each 1 share of common stock outstanding. All references in these
financial statements and notes to financial statements of common shares to
number of shares, price per common share and weighted average number of common
shares outstanding prior to the 7:1 split-up in the form of dividend
(split-up) declared on October 9, 2008 have been adjusted to reflect the
split-up on a retroactive basis unless otherwise noted.

| |                                       |  | Number of  |  |   | Proceeds | 
| | ------------------------------------- |  | ---------- |  | - | -------- | 
| |                                       |  | Shares     |  |   |          | 
| | Balance, February 5, 2008             |  | -          |  | $ | -        | 
| |                                       |  |            |  |   |          | 
| | Issued for private placement          |  |            |  |   |          | 
| | 5,000,000 shares, and split-up        |  |            |  |   |          | 
| | in
      the form of a dividend 7:1   |  | 35,000,000 |  |   | 50       | 
| |                                       |  |            |  |   |          | 
| | Issued during initial public offering |  |            |  |   |          | 
| | 523,600 shares,
      and split-up    |  |            |  |   |          | 
| | in
      the form of a dividend 7:1   |  | 3,665,200  |  |   | 104,720  | 
| |                                       |  |            |  |   |          | 
| | Balance, August 31, 2009              |  | 38,665,200 |  | $ | 104,770  | 

---

|Future Canada China Environment Inc.
|------------------------------------
|(A Development Stage Company)       
|Notes to Financial Statements       
|August 31, 2009                     
|(Unaudited)                         

|Note 5 | Related Party Transactions
|------ | --------------------------

As of August 31, 2009, $118,592 is
owed to Hsi Chun Chiang and recorded as due to related party. This amount was
incurred from company expenses paid by Hsi Chun Chiang.

As of August 31, 2009, $26,523 is owed
to Paul Young and recorded as due to related party. This amount was incurred
from company expenses paid by Paul Young.

During the three months ended August
31, 2009, the Company reimbursed $6,170 of expenses paid on behalf of the
Company by Michael Hu, former President and CEO of the Company. As of August 31,
2009, $213 is owed to Michael Hu and recorded as due to related party. This
amount was incurred from company expenses paid by Michael Hu.

As of August 31, 2009, $5,024 is owed
to Rui Yang, President and CEO of the Company, and recorded as due to related
party. This amount was incurred from company expenses paid by Rui Yang.

Neither Hsi Chun Chiang, Paul Young,
Michael Hu nor Rui Yang will receive any interest on any funds that they advance
to the Company and there are no set repayment terms.

During the period, the Company accrued
$15,000 of director fees due to Rui Yang and $14,000 to Michael Hu.

Director fees payable is recorded as
accounts payable  related party.

On January 15, 2009, the Company
entered into a Public Relations, Promotion and Marketing Agreement with CityVac
Services. The consideration for CityVacs services is 5,000 restricted shares of
the companys common stock. The 5,000 shares of common stock were transferred
from Hsi Chun Chiangs, prior President of the company, personal shares.
CityVacs service was valued at $50,000 and 5,000 shares of Hsi Chun Chiangs
common stock were valued at $143. The difference of $49,857 was recorded as debt
forgiveness from CityVac IR Services on February 28, 2009.

On April 1, 2009, the company entered
into a financial advisory agreement with Network 1 Financial Securities, Inc.
The consideration for Network 1s services is 100,000 restricted shares of the
companys common stock. The 100,000 shares of common stock were transferred from
Hsi Chun Chiangs, prior President of the company, personal shares. Network 1s
service was valued at $4,500 and 100,000 shares of Hsi Chun Chiangs common
stock were valued at $2,857. The difference of $1,643 was recorded as debt
forgiveness from Network 1 Services on May 31, 2009.

---

|Future Canada China Environment Inc.
|------------------------------------
|(A Development Stage Company)       
|Notes to Financial Statements       
|August 31, 2009                     
|(Unaudited)                         

|Note 6 | Recently Issued Accounting
      Pronouncements
|------ | -----------------------------------------------

In May 2009, the FSAB issued SFAS No.
165, Subsequent Events, SFAS No. 165 is intended to establish general
standards of accounting for and disclosure of events that occur after the
balance sheet date, but before financial statements are issued or are available
to be issued. It requires the disclosure of the date through which an entity has
evaluated subsequent events and the basis for that date-that is, whether that
date represents the date the financial statements were issued or were available
to be issued. This disclosure should alert all users of financial statements
that an entity has not evaluated subsequent events after that date in the set of
financial statements being presented. SFAS No. 165 is effective for financial
statements issued for fiscal years and interim periods ending after June 15,
2009. We plan to adopt SFAS 165 in the first quarter of Fiscal 2010 and do not
expect it to have a material impact on our financial statements.

In June 2009, the FASB issued
Statement of Financial Accounting Standards No. 166, Accounting for Transfers
of Financial Assets, an amendment to SFAS No. 140, (SFAS 166). SFAS 166
eliminates the concept of a qualifying special-purpose entity, changes the
requirements for derecognizing financial assets, and requires additional
disclosures in order to enhance information reported to users of financial
statements by providing greater transparency about transfers of financial
assets, including securitization transactions, and an entitys continuing
involvement in and exposure to the risks related to transferred financial
assets. SFAS 166 is effective for fiscal years beginning after November 15,
2009. The Company will adopt SFAS 166 in fiscal 2011. The Company does not
expect that the adoption of SFAS 166 will have a material impact on the
financial statements.

In June 2009, the FASB issued
Statement of Financial Accounting Standards No. 167, Amendments to FASB
Interpretation No. 46(R), (SFAS 167). The amendments include: (1) the
elimination of the exemption for qualifying special purpose entities, (2) a new
approach for determining who should consolidate a variable-interest entity, and
(3) changes to when it is necessary to reassess who should consolidate a
variable-interest entity. SFAS 167 is effective for the first annual reporting
period beginning after November 15, 2009 and for interim periods within that
first annual reporting period. The Company will adopt SFAS 167 in fiscal 2011.
The Company does not expect that the adoption of SFAS 166 will have a material
impact on the financial statements.

In June 2009, the FASB issued
Statement of Financial Accounting Standards No. 168, The FASB Accounting
Standards Codification and the Hierarchy of Generally Accepted Accounting
Principles, (SFAS 168). SFAS 168 replaces FASB Statement No. 162, The
Hierarchy of Generally Accepted Accounting Principles, and establishes the FASB
Accounting Standards Codification (Codification) as the source of
authoritative accounting principles recognized by the FASB to be applied by
nongovernmental entities in the preparation of financial statements in
conformity with generally accepted accounting principles (GAAP). SFAS 168 is
effective for interim and annual periods ending after September 15, 2009. The
Company will begin to use the new Codification when referring to GAAP in its
annual report on Form 10-K for the fiscal year ending February 28, 2011. This
will not have an impact on the results of the Company.

---

|Future Canada China Environment Inc.
|------------------------------------
|(A Development Stage Company)       
|Notes to Financial Statements       
|August 31, 2009                     
|(Unaudited)                         

|Note 7 | Share  Based Compensation
|------ | --------------------------

As approved by the Board of Directors,
on May 5, 2009, the Company granted 200,000 shares fully vested stock options to
Rui Yang, appointed President, Treasurer and director of the company on July 7,
2009 at $5 per share for term of three years. The total fair value of these
options at the date of grant was estimated to be $7,189 and was determined using
the Black-Scholes option pricing model with an expected life of 1 year, a risk
free interest rate of 0.53%, a dividend yield of 0% and expected volatility of
99.57% and was recorded as a stock based compensation expense in 2009.

On July 28, 2009, the Company granted
930,000 shares of fully vested stock options to its officers and consultants for
term of three years. Of the 930,000 options, 920,000 are exercisable at $5 and
10,000 are exercisable at $0.25. The total fair value of these options at the
date of grant was estimated to be $40,823 and was determined using the
Black-Scholes option pricing model with an expected life of 1 year, a risk free
interest rate of 0.49%, a dividend yield of 0% and expected volatility of
100.09% and was recorded as a stock based compensation expense in 2009.

The Companys stock option activity
for the period ended August 31, 2009 is summarized as follows:

| |                                |  | Number of |  |   | Weighted  |  |  | Weighted        | 
| | ------------------------------ |  | --------- |  | - | --------- |  |  | --------------- | 
| |                                |  | Options   |  |   | average   |  |  | average         | 
| |                                |  |           |  |   | exercise  |  |  | remaining in    | 
| |                                |  |           |  |   | price     |  |  | contractual     | 
| |                                |  |           |  |   | per share |  |  | life (in years) | 
| |                                |  |           |  |   |           |  |  |                 | 
| | Balance, February 28, 2009     |  | -         |  | $ | -         |  |  | -               | 
| |                                |  |           |  |   |           |  |  |                 | 
| | Granted during the period      |  |           |  |   |           |  |  |                 | 
| |                                |  | 1,130,000 |  |   | 4.96      |  |  | 3               | 
| | Exercised                      |  | -         |  |   | -         |  |  | -               | 
| | Expired/Cancelled              |  | -         |  |   | -         |  |  | -               | 
| |                                |  |           |  |   |           |  |  |                 | 
| | Balance, August
      31, 2009 |  | 1,130,000 |  | $ | 4.96      |  |  | 3               | 

---

|Future Canada China Environment Inc.
|------------------------------------
|(A Development Stage Company)       
|Notes to Financial Statements       
|August 31, 2009                     
|(Unaudited)                         

|Note 8 | Commitments and Contingencies
|------ | -----------------------------

On February 2, 2009, the Company
entered into a share exchange agreement with Guangdong Hongmao Industrial Co.
Ltd. (Guangdong) located in Guang Zhou, China. The Company agrees to acquire
all of the issued and outstanding shares of Guangdongs common stock in exchange
for the issuance by the Company of such number of shares of the Companys common
stock as is equal to the total of Guangdongs assets divided by the market price
of the Companys common stock. As of the date of this report, the Company has
not completed the share exchange since the Company is awaiting audited financial
statements of Guangdong Hongmao Industrial Co., Ltd. to determine the number of
shares required in the share exchange. In the event that this agreement is
breached for any reason, the non-breaching party may seek damages from the
breaching party.

Hong Mao was established in 2002, is
principally engaged in the business of the production of biological fertilizer,
ecological tree growing, high quality garden and flower growing, organic food
and green vegetable processing and a vegetable basket service project.

|Note 9 | Changes in Control or Registrant
|------ | --------------------------------

On November 13, 2008, Chi Ching Chiang
transferred 32,920,000 restricted shares of common stock owned by her to Hsi
Chun Chiang, President and CEO of the Company. After the transfer, Hsi Chun
Chiang owns total of 32,920,000 restricted shares of common stock or 85.14% of
the total shares of common stock outstanding.

On February 27, 2009, Hsi Chun Chiang
resigned as President, Chief Executive Officer Secretary, Treasurer, Principal
Financial Officer and Principal Accounting Officer. Hsi continues to serve as a
member of the Board of Directors.

On February 27, 2009, Paul Young, a
member of the Board of Directors, was appointed as President, Principal
Executive Officer, Secretary, Treasurer, Principal Financial Officer and
Principal Accounting Officer. Paul Young resigned as Vice President on April 13,
2009.

On April 1, 2009, Hsi Chun Chiang,
former president of the company, entered into a share transfer agreement with
Paul Young. Paul Young was appointed President, Principal Executive Officer,
Secretary, Treasurer, Principal Financial Officer and Principal Accounting
Officer on February 27, 2009. Pursuant to the terms of the share transfer
agreement, Ms. Chiang transferred 24,395,000 shares of common stock to Mr.
Young.

On April 1, 2009, the company entered
into a financial advisory agreement with Network 1 Financial Securities, Inc.
Pursuant to the terms of the agreement, Network 1 Financial Securities, Inc.
will assist the company in financings and acquisitions. The term of the
agreement is for a period of six months. In consideration for Network 1
Financial Securities, Inc.s services, the company agreed to issue 100,000
restricted shares of the companys common stock to Network 1 Financial
Securities, Inc., which was transferred from Hsi Chun Chiang, former president
of the Company.

---

|Future Canada China Environment Inc.
|------------------------------------
|(A Development Stage Company)       
|Notes to Financial Statements       
|August 31, 2009                     
|(Unaudited)                         

|Note 9 | Changes in Control or Registrant
      (Continued)
|------ | --------------------------------------------------

On April 13, 2009, Paul Young resigned
as President, Secretary, Treasurer and director of the company. Mr. Young
entered into a share transfer agreement with (Michael) Hua Hu. Hua Hu was
appointed President, Secretary, Treasurer and director on April 13, 2009.
Pursuant to the terms of the share transfer agreement, Mr. Young transferred
24,285,000 shares of common stock to Mr. Hu. The aggregate number and percentage
of common shares of the issuer beneficially owned by Mr. Hua Hu was 24,285,000
or 62.81% .

On April 29, 2009, Rui Yang was
appointed as vice president of the company.

On April 30, 2009, Hsi Chun Chiang
resigned as director of the company. As a result, the board of directors now
solely consists of (Michael) Hua Hu.

On May 5, 2009, the company entered
into a stock option agreement with Rui Yang, the companys vice president. The
board of directors of the company has granted stock options to purchase a total
of 200,000 shares of the companys common stock at a price of $5.00 per share to
Mr. Yang. The stock options vested immediately and expire on May 5, 2012.

On July 7, 2009, Michael Hua Hu
resigned as President, Secretary, Treasurer and Director of the company.

On July 7, 2009, Rui Yang, vice
president of the company was appointed as President, Secretary, Treasurer and
director of the company. As a result, the board of directors now solely consists
of Rui Yang.

|Note 10 | Other Matters
|------- | -------------

On January 28, 2009, the Securities
and Exchange Commission announced the temporary suspension, pursuant to Section
12 (k) of the Securities Exchange Act of 1934, of trading in the securities of
the company. The temporary suspension expired February 10, 2009.

---

Item 2. Managements Discussion and Analysis of Financial
Condition and Results of Operations

Forward-Looking Statements

This quarterly report contains forward-looking statements.
These statements relate to future events or our future financial performance. In
some cases, you can identify forward-looking statements by terminology such as
"may", "should", "expects", "plans", "anticipates", "believes", "estimates",
"predicts", "potential" or "continue" or the negative of these terms or other
comparable terminology. These statements are only predictions and involve known
and unknown risks, uncertainties and other factors, including the risks in the
section entitled "Risk Factors", that may cause our or our industry's actual
results, levels of activity, performance or achievements to be materially
different from any future results, levels of activity, performance or
achievements expressed or implied by these forward-looking statements. Although
we believe that the expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future results, levels of activity, performance
or achievements. Except as required by applicable law, including the securities
laws of the United States, we do not intend to update any of the forward-looking
statements to conform these statements to actual results.

Our unaudited financial statements are stated in United States
Dollars (US$) and are prepared in accordance with United States Generally
Accepted Accounting Principles. The following discussion should be read in
conjunction with our financial statements and the related notes that appear
elsewhere in this quarterly report. The following discussion contains
forward-looking statements that reflect our plans, estimates and beliefs. Our
actual results could differ materially from those discussed in the forward
looking statements. Factors that could cause or contribute to such differences
include, but are not limited to, those discussed below and elsewhere in this
quarterly report, particularly in the section entitled "Risk Factors".

In this quarterly report, unless otherwise specified, all
dollar amounts are expressed in United States dollars. All references to "common
shares" refer to the common shares in our capital stock.

As used in this quarterly report and unless otherwise
indicated, the terms we, us, our company, mean Future Canada China
Environment Inc., a Nevada corporation, unless otherwise indicated.

Corporate History

Our company was incorporated in Nevada on February 5, 2008.

Since inception, we have been a development stage company and
we intended to provide consulting services to Chinese corporations in order to
assist them in reducing Greenhouse Gas emissions.

Due to the implementation of British Columbia Instrument 51-509
on September 30, 2008 by the British Columbia Securities Commission, we have
been deemed to be a British Columbia based reporting issuer. As such, we are
required to file certain information and documents at www.sedar.com.

On September 9, 2008, Kin Bun Kwong was appointed our Vice
President and Legal Representative in the Peoples Republic of China.

On September 30, 2008, Paul Young was appointed to our board of
directors and vice president.

On January 15, 2009, we entered into a Public Relations,
Promotion and Marketing Letter Agreement (the Agreement) with CityVac IR
Services (CityVac) located in Celebration, Florida, whereby CityVac will
provide consulting, promotional and marketing services for us. The consideration
for CityVacs services is 5,000 restricted shares of our common stock. The
shares of common stock were issued pursuant to the exemption from registration
contained in Section 4(2) of the Securities Act of 1933. CityVac was supplied
with copies of all information that can be found in a Form S-1 registration
statement and is a sophisticated investor. The term of the Agreement is from
January 18, 2009 to June 18, 2009. Each party agreed to mutual rights of
indemnification.

---

On February 2, 2009, we entered into a share exchange agreement with Guangdong Hongmao Industrial Co., Ltd., a Peoples Republic of China Corporation, and the shareholders of Guangdong Hongmao Industrial Co., Ltd. Pursuant to the terms of the
share exchange agreement, we have agreed to acquire all of the issued and outstanding shares of Guangdong Hongmao Industrial Co., Ltd.s common stock in exchange for the issuance by our company of such number of shares of our common stock as is
equal to the total of Guangdong Hongmao Industrial Co., Ltd.s assets, as set out in the audited statements of Guangdong Hongmao Industrial Co., Ltd., divided by the closing market price of our companys common stock as quoted on the Over
the Counter Bulletin Board as of the closing date of the agreement, to the shareholders of Guangdong Hongmao Industrial Co., Ltd. Due to conditions precedent to closing and the risk that these conditions precedent will not be satisfied, there is no
assurance that we will complete the share exchange.

On January 28, 2009, the Securities and Exchange Commission announced the temporary suspension, pursuant to Section 12(k) of the Securities Exchange of 1934, of trading in the securities of our company. The temporary suspension will expire at 11:59
p.m. (Eastern Standard Time) on February 10, 2009.

The Securities and Exchange Commission temporarily suspended trading in our securities due to recent trading activity in our companys common stock and due to questions concerning the accuracy and adequacy of the publicly available information
regarding our planned acquisition of Guangdong Hongmao Industrial Co., Ltd.

Upon termination of the temporary suspension and in compliance with Rule 15c2-11, any brokers wishing to acquire any of our securities must have a copy of our prospectus, our most recent annual report and our most recent current reports and
quarterly reports and based upon a review of such documents must have a reasonable basis for believing that such documents are accurate in all material respects and that the sources of such information are reliable.

Additionally, without limiting the foregoing, brokers must keep up-to-date information on our financial status, our companys name, the address of our principal executive office, our state of incorporation, the name of our transfer agent, our
insiders, the nature of our business, the nature of the products we offer and must provide this information to any potential purchasers of our common stock upon request.

Due to the implementation of British Columbia Instrument 51-509 on September 30, 2008 by the British Columbia Securities Commission, we have been deemed to be a British Columbia based reporting issuer. As such, we are required to file certain
information and documents at www.sedar.com

Further to our Form 8-K filed on October 10, 2008 and our press releases dated November 10, 2008 and December 19, 2008, we wish to correct certain disclosure relating to the name of the company we plan to acquire. We incorrectly disclosed the name
of the private company as Hong Mao Enterprise Ltd., the companys correct name is Guangdong Hongmao Industrial Co., Ltd.

On February 27, 2009, Hsi Chun Chiang resigned as President, Chief Executive Officer, Secretary, Treasurer, Principal Financial Officer and Principal Accounting Officer. Ms. Chiang continued to serve as a member of the Board of Directors.

On February 27, 2009, Paul Young, a member of our Board of Directors, was appointed as our President, Principal Executive Officer, Secretary, Treasurer, Principal Financial Officer and Principal Accounting Officer. Mr. Young resigned as our Vice
President. Mr. Young continued to serve on our Board of Directors.

On April 1, 2009, we entered into a financial advisory agreement with Network 1 Financial Securities, Inc. Pursuant to the terms of the agreement, Network 1 Financial Securities, Inc. will assist our company in financings and acquisitions. The term
of the agreement is for a period of six months. In consideration for Network 1 Financial Securities, Inc.s services, we have agreed to issue 100,000 restricted shares of our common stock to Network 1 Financial Securities, Inc.

On April 13, 2009, Paul Young resigned as President, Secretary, Treasurer and a director of our company. As a result of the resignation of Mr. Young on April 13, 2009, we appointed (Michael) Hua Hu as President, Secretary, Treasurer and director of
our company.

---

On April 29, 2009, Rui Yang was appointed as vice president of our company. On April 30, 2009, Hsi Chun Chiang resigned as director of our company.

On May 5, 2009, our company entered into a stock option agreement with Rui Yang, our companys vice president. The board of directors of our company has granted stock options to purchase a total of 200,000 shares of our common stock at a price
of $5.00 per share to Mr. Yang. The stock options vested immediately and expire on May 5, 2012.

On July 7, 2009, Michael Hua Hu resigned as President, Secretary, Treasurer and a director of our company. As a result of the resignation of Mr. Hua Hu on July 7, 2009, we appointed Rui Yang as President, Secretary, Treasurer and director of our
company. Our board of directors now solely consists of Rui Yang.

July 7, 2009, Michael Hua Hu, the Companys former President, Secretary, Treasurer and director, transferred 20,785,000 restricted shares of the Companys common stock to Kin Bun Kwong, the Companys Vice President and Legal
Representative in the Peoples of Republic of China. Mr. Kwong purchased the shares from personal funds in the amount of $500. Mr. Hua Hu now owns 9.05% of the issued and outstanding shares of the Company. Mr. Kin Bun Kwong now owns 53.8% of the
issued and outstanding shares of the Company.

On July 28, 2009, Mr. Rui Yang resigned as Secretary of our company. As a result of the resignation of Mr. Rui Yang on July 28, 2009, we appointed Mr. Alan Chan as Secretary of our company.

On July 28, 2009, we appointed Mr. Gang Xiang as Vice President of our company.

On July 28, 2009, we granted stock options to our secretary to purchase up to 10,000 shares of our common stock at an exercise price of $0.25 per share, exercisable until July 28, 2012. We issued the stock options to one (1) non-U.S. persons (at
that term as defined in Regulation S of the Securities Act of 1933), in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933.

On July 28, 2009, we granted stock options to five (5) individuals, including our president and secretary to purchase up to 920,000 shares of our common stock at an exercise price of $5.00 per share, exercisable until July 28, 2012. We issued
the stock options to five (5) non-U.S. persons (at that term as defined in Regulation S of the Securities Act of 1933), in an offshore transaction relying on Regulation S and/or Section 4(2) of the Securities Act of 1933.

Our board of directors now solely consists of Mr. Rui Yang.

Our Current Business

We were incorporated pursuant to the laws of the State of Nevada on February 5, 2008. Since our incorporation, we intended to be in the business of providing consulting services to Chinese corporations in order to assist them in reducing Greenhouse
Gas emissions.

On February 2, 2009, we entered into a share exchange agreement with Guangdong Hongmao Industrial Co., Ltd., a Peoples Republic of China Corporation, and the shareholders of Guangdong Hongmao Industrial Co., Ltd. Pursuant to the terms of the
share exchange agreement, we have agreed to acquire all of the issued and outstanding shares of Guangdong Hongmao Industrial Co., Ltd.s common stock in exchange for the issuance by our company of such number of shares of our common stock as is
equal to the total of Guangdong Hongmao Industrial Co., Ltd.s assets, as set out in the audited statements of Guangdong Hongmao Industrial Co., Ltd., divided by the closing market price of our companys common stock as quoted on the Over
the Counter Bulletin Board as of the closing date of the agreement, to the shareholders of Guangdong Hongmao Industrial Co., Ltd. As of the date of this filing, we have not completed the share exchange since we are awaiting audited financial
statements of Guangdong Hongmao Industrial Co., Ltd. to determine the number of shares required in the share exchange. Due to conditions precedent to closing and the risk that these conditions precedent will not be satisfied, there is no assurance
that we will complete the share exchange.

---

Guangdong Hongmao Industrial Co., Ltd. is principally engaged
in the business of the production of biological fertilizer, ecological tree
growing, high quality garden and flower growing, organic food and green
vegetable processing, and a vegetable basket service project.

In addition to attempting to complete the acquisition of
Guangdong Hongmao Industrial Co., Ltd., our management is currently evaluating
other potential business opportunities that might be available to our company.
Our management will begin analyzing various alternatives available to our
company to ensure our survival and to preserve our shareholder's investment in
our common shares. This analysis will include sourcing additional forms of
financing to engage in mergers and/or acquisitions. At this stage in our
operations, we believe either course is acceptable, as our operations have not
been profitable and our future prospects for our original consulting business
are not good.

On August 24, 2009, we entered into an amendment agreement to
the share exchange agreement with Guangdong Hongmao Industrial Co., Ltd., a
Peoples Republic of China Corporation, and the shareholders of Guangdong
Hongmao Industrial Co., Ltd. The amending agreement alters certain terms and
conditions to the share exchange agreement dated February 2, 2009. A copy of the
amending agreement was attached as Exhibit 10.1 to our Amended Current Report on
Form 8-K/A filed on August 27, 2009.

Results of Operations

The following summary of our results of operations should be
read in conjunction with our financial statements for the quarter ended August
31, 2009 which are included herein.

Three month period ended August 31, 2009 compared to the
three month period ended August 31, 2008.

Three Months EndedAugust 31
    
    
    August 312009
    
    
    2008Revenue
    $
    Nil
    
    $
    NilSelling, General and Administrative
    $
    125,624
    
    $
    28,796Debt Forgiveness
    $
      Nil
    
    $
    NilNet Operating Loss
    $
    125,624
    
    $
    28,796


Expenses

Our selling, general and administrative expenses for the three
month period ended August 31, 2009 was $125,624 and was mainly comprised of
rent, auditor fees, consulting fees, management fees, directors fees and legal
fees.

Six month period ended August 31, 2009 compared to the six
month period ended August 31, 2008.

Six Months EndedAugust 31
    
    
    August 312009
    
    
    2008Revenue
    $
    Nil
    
    $
    NilSelling, General and Administrative
    $
    233,873
    
    $
    64,017Debt Forgiveness
    $
    1,643
    
    $
    NilNet Operating Loss
    $
    232,230
    
    $
    64,017


Expenses

Our selling, general and administrative expenses for the six
month period ended August 31, 2009 was $233,873 and was mainly comprised of
rent, auditor fees, consulting fees, management fees, directors fees and legal
fees.

Revenues

We have not earned any revenues since our inception and we do
not anticipate earning revenues in the near future.

---

Liquidity and Capital Resources

As of August 31, 2009, our total current assets were $18,231
  and our total current liabilities were $309,459 and we had a working capital
  deficit of $291,228. Our financial statements report a net loss of $232,230
  for the six month period ended August 31, 2009, and a net loss of $443,515 for
  the period from Inception (February 5, 2008) to August 31, 2009.

We have suffered recurring losses from operations. The
continuation of our company is dependent upon our company attaining and
maintaining profitable operations and raising additional capital as needed. In
this regard we have raised additional capital through equity offerings and loan
transactions.

Cash Flows

|                                                    |   | At         |   |   | At         |  
|--------------------------------------------------- | - | ---------- | - | - | ---------- | -
|                                                    |   | August 31, |   |   | August 31, |  
|                                                    |   | 2009       |   |   | 2008       |  
|                                                    |   |            |   |   |            |  
|Net Cash (Used in) Operating Activities             | $ | (62,608    | ) | $ | (74,017    | )
|Net Cash Provided by (Used In) Investing Activities | $ | Nil        |   | $ | Nil        |  
|Net Cash Provided by (Used In) Financing Activities | $ | (7,082     | ) | $ | 74,052     |  
|Increase In Cash During The Period                  | $ | (69,690    | ) | $ | 35         |  

We had cash in the amount of $7,481 as of August 31, 2009 and a
working capital deficit of $291,228 as of August 31, 2009.

Our principal sources of funds have been from sales of our
common stock and Due to related party.

Contractual Obligations

As a smaller reporting company, we are not required to
provide tabular disclosure obligations.

Going Concern

We anticipate that additional funding will be required in the
form of equity financing from the sale of our common stock. At this time, we
cannot provide investors with any assurance that we will be able to raise
sufficient funding from the sale of our common stock or through a loan from our
directors to meet our obligations over the next twelve months. We do not have
any arrangements in place for any future debt or equity financing.

Off-Balance Sheet Arrangements

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

Application of Critical Accounting Policies

Basis of presentation

The financial statements have been prepared in accordance with
accounting principles generally accepted in the United States. In the opinion of
management, all adjustments, consisting of normal recurring accruals considered
necessary for a fair presentation, have been included. Operating results for the
three months ended August 31, 2009 are not necessarily indicative of the results
that may be expected for the year ending February 28, 2010. For further
information, refer to the financial statements and footnotes thereto included in
the Form 10-K for the year ended February 28, 2009.

---

Use of estimates

The preparation of financial statements in conformity with U.S.
Generally Accepted Accounting Principles requires management to make estimates
and assumptions that affect 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 revenue and expense during the reporting
period. Actual results could differ from those estimates and may impact future
results of operations and cash flows.

Cash and cash equivalents

For the purposes of the statement of cash flows, the Company
considers highly liquid financial instruments purchased with maturities of three
months or less to be cash equivalents.

Income Taxes

The Company accounts for its income taxes in accordance with
Statement of Financial Accounting Standards No. 109, which requires recognition
of deferred tax assets and liabilities for future tax consequences attributable
to differences between the financial statement carrying amounts of existing
assets and liabilities and their respective tax bases and tax credit
carry-forwards. Deferred tax assets and liabilities are measured using enacted
tax rates expected to apply to taxable income in the years in which those
temporary differences are expected to be recovered or settled. The effect on
deferred tax assets and liabilities or a change in tax rate is recognized in
income in the period that includes the enactment date.

Fair value of financial instruments

Financial accounting standards statement No. 107 Disclosure
about Fair Value of Financial Instruments, requires the Company to disclose,
when reasonably attainable, the fair market value of its assets and liabilities
which are deemed to be financial instruments. The carrying amount and estimated
fair values of the Companys financial instruments approximated their fair value
due to their short-term nature.

Loss per share

The Company computes net loss per share in accordance with SFAS
No. 128, Earnings per Share (SFAS 128) and SEC Staff Accounting Bulletin No.
98 (SAB 98). Under the provisions of SFAS 128 and SAB 98, basic net loss per
share is computed by dividing the net loss available to common stockholders for
the period by the weighted average number of shares of common stock outstanding
during the period.

Diluted loss per share is computed using the weighted average
number of shares and dilutive potential common shares outstanding. Potentially
dilutive common shares consist of employee stock options, warrants, and
restricted stock, and are excluded from the diluted earnings per share
computation in periods where the Company has incurred a net loss.

Recently Issued Accounting Pronouncements

In May 2009, the FSAB issued SFAS No. 165, Subsequent Events,
SFAS No. 165 is intended to establish general standards of accounting for and
disclosure of events that occur after the balance sheet date, but before
financial statements are issued or are available to be issued. It requires the
disclosure of the date through which an entity has evaluated subsequent events
and the basis for that date-that is, whether that date represents the date the
financial statements were issued or were available to be issued. This disclosure
should alert all users of financial statements that an entity has not evaluated
subsequent events after that date in the set of financial statements being
presented.

---

SFAS No. 165 is effective for financial statements issued for fiscal years and interim periods ending after June 15, 2009. We plan to adopt SFAS 165 in the first quarter of Fiscal 2010 and do not expect it to have a material impact on our financial
statements.

In June 2009, the FASB issued Statement of Financial Accounting Standards No. 166, Accounting for Transfers of Financial Assets, an amendment to SFAS No. 140, (SFAS 166). SFAS 166 eliminates the concept of a qualifying
special-purpose entity, changes the requirements for derecognizing financial assets, and requires additional disclosures in order to enhance information reported to users of financial statements by providing greater transparency about
transfers of financial assets, including securitization transactions, and an entitys continuing involvement in and exposure to the risks related to transferred financial assets. SFAS 166 is effective for fiscal years beginning after November
15, 2009. The Company will adopt SFAS 166 in fiscal 2011. The Company does not expect that the adoption of SFAS 166 will have a material impact on the financial statements.

In June 2009, the FASB issued Statement of Financial Accounting Standards No. 167, Amendments to FASB Interpretation No. 46(R), (SFAS 167). The amendments include: (1) the elimination of the exemption for qualifying special
purpose entities, (2) a new approach for determining who should consolidate a variable-interest entity, and (3) changes to when it is necessary to reassess who should consolidate a variable-interest entity. SFAS 167 is effective for the first annual
reporting period beginning after November 15, 2009 and for interim periods within that first annual reporting period. The Company will adopt SFAS 167 in fiscal 2011. The Company does not expect that the adoption of SFAS 166 will have a material
impact on the financial statements.

In June 2009, the FASB issued Statement of Financial Accounting Standards No. 168, The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles, (SFAS 168). SFAS 168 replaces FASB
Statement No. 162, The Hierarchy of Generally Accepted Accounting Principles, and establishes the FASB Accounting Standards Codification (Codification) as the source of authoritative accounting principles recognized by the
FASB to be applied by nongovernmental entities in the preparation of financial statements in conformity with generally accepted accounting principles (GAAP). SFAS 168 is effective for interim and annual periods ending after September 15,
2009. The Company will begin to use the new Codification when referring to GAAP in its annual report on Form 10-K for the fiscal year ending February 28, 2011. This will not have an impact on the results of the Company.

Item 4. Controls and Procedures

Managements Report on Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported
within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to our management, including our president (also our principal executive officer, principal
financial officer and principal accounting officer) to allow for timely decisions regarding required disclosure.

As of August 31, 2009, the end of our second quarter covered by this report, we carried out an evaluation, under the supervision and with the participation of our president (also our principal executive officer, principal financial and accounting
officer), of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our president (also our principal executive officer, principal financial and accounting officer) concluded that our
disclosure controls and procedures were effective in providing reasonable assurance in the reliability of our financial reports as of the end of the period covered by this quarterly report.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal controls over financial reporting that occurred during the quarter ended August 31, 2009 that have materially or are reasonably likely to materially affect, our internal controls over financial reporting.

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PART II

OTHER INFORMATION

Item 1. Legal Proceedings

We know of no material, active or pending legal proceedings
against the Company, nor are we involved as a plaintiff in any material
proceeding or pending litigation. There are no proceedings in which any of our
directors, officers or affiliates, or any registered or beneficial shareholder,
is an adverse party or has a material interest adverse to our interest.

Item 1A. Risk Factors

Much of the information included in this annual report includes
or is based upon estimates, projections or other forward looking statements.
Such forward looking statements include any projections and estimates made by us
and our management in connection with our business operations. While these
forward-looking statements, and any assumptions upon which they are based, are
made in good faith and reflect our current judgment regarding the direction of
our business, actual results will almost always vary, sometimes materially, from
any estimates, predictions, projections, assumptions or other future performance
suggested herein.

Such estimates, projections or other forward looking
statements involve various risks and uncertainties as outlined below. We
caution the reader that important factors in some cases have affected and, in
the future, could materially affect actual results and cause actual results to
differ materially from the results expressed in any such estimates, projections
or other forward looking statements.

Our common shares are considered speculative as our business is
still in an early growth stage of its development. Prospective investors should
consider carefully the risk factors set out below.

Because our auditors have issued a going concern opinion,
there is substantial uncertainty we will continue activities in which case you
could lose your investment.

Our auditors have issued a going concern opinion. This means
that there is substantial doubt that we can continue as an ongoing business for
the next twelve months. As such we may have to cease activities and you could
lose your investment.

Our management is currently seeking out potential business
opportunities and there are numerous risks associated with any potential
business opportunity.

We intend to use reasonable efforts to acquire or complete
potential business opportunities that our management determines is in the best
interests of our shareholders. Such combinations will be accompanied by risks
commonly encountered in acquisitions. Failure to manage and successfully
integrate acquisitions we make could harm our business, our strategy and our
operating results in a material way.

Trading in our common shares on the OTC Bulletin Board is
limited and sporadic making it difficult for our shareholders to sell their
shares or liquidate their investments.

Our common shares are currently listed for public trading on
the OTC Bulletin Board. The trading price of our common shares has been subject
to wide fluctuations. Trading prices of our common shares may fluctuate in
response to a number of factors, many of which will be beyond our control. The
stock market has generally experienced extreme price and volume fluctuations
that have often been unrelated or disproportionate to the operating performance
of companies with no current business operation. There can be no assurance that
trading prices and price earnings ratios previously experienced by our common
shares will be matched or maintained. These broad market and industry factors
may adversely affect the market price of our common shares, regardless of our
operating performance.

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In the past, following periods of volatility in the market
price of a companys securities, securities class-action litigation has often
been instituted. Such litigation, if instituted, could result in substantial
costs for us and a diversion of managements attention and resources.

Our stock is a penny stock. Trading of our stock may be
restricted by the SECs penny stock regulations which may limit a stockholders
ability to buy and sell our stock.

Our stock is a penny stock. The Securities and Exchange
Commission has adopted Rule 15g-9 which generally defines penny stock to be
any equity security that has a market price (as defined) less than $5.00 per
share or an exercise price of less than $5.00 per share, subject to certain
exceptions. Our securities are covered by the penny stock rules, which impose
additional sales practice requirements on broker-dealers who sell to persons
other than established customers and accredited investors. The term
accredited investor refers generally to institutions with assets in excess of
$5,000,000 or individuals with a net worth in excess of $1,000,000 or annual
income exceeding $200,000 or $300,000 jointly with their spouse. The penny stock
rules require a broker-dealer, prior to a transaction in a penny stock not
otherwise exempt from the rules, to deliver a standardized risk disclosure
document in a form prepared by the SEC which provides information about penny
stocks and the nature and level of risks in the penny stock market. The
broker-dealer also must provide the customer with current bid and offer
quotations for the penny stock, the compensation of the broker-dealer and its
salesperson in the transaction and monthly account statements showing the market
value of each penny stock held in the customers account. The bid and offer
quotations, and the broker-dealer and salesperson compensation information, must
be given to the customer orally or in writing prior to effecting the transaction
and must be given to the customer in writing before or with the customers
confirmation. In addition, the penny stock rules require that prior to a
transaction in a penny stock not otherwise exempt from these rules, the
broker-dealer must make a special written determination that the penny stock is
a suitable investment for the purchaser and receive the purchasers written
agreement to the transaction. These disclosure requirements may have the effect
of reducing the level of trading activity in the secondary market for the stock
that is subject to these penny stock rules. Consequently, these penny stock
rules may affect the ability of broker-dealers to trade our securities. We
believe that the penny stock rules discourage investor interest in and limit the
marketability of our common stock.

The Financial Industry Regulatory Authority, or FINRA, has
adopted sales practice requirements which may also limit a stockholder's ability
to buy and sell our stock.

In addition to the "penny stock" rules described above, FINRA
has adopted rules that require that in recommending an investment to a customer,
a broker-dealer must have reasonable grounds for believing that the investment
is suitable for that customer. Prior to recommending speculative low priced
securities to their non-institutional customers, broker-dealers must make
reasonable efforts to obtain information about the customer's financial status,
tax status, investment objectives and other information. Under interpretations
of these rules, FINRA believes that there is a high probability that speculative
low priced securities will not be suitable for at least some customers. FINRA
requirements make it more difficult for broker-dealers to recommend that their
customers buy our common stock, which may limit your ability to buy and sell our
stock and have an adverse effect on the market for our shares.

Trends, Risks and Uncertainties

We have sought to identify what we believe to be the most
significant risks to our business, but we cannot predict whether, or to what
extent, any of such risks may be realized nor can we guarantee that we have
identified all possible risks that might arise. Investors should carefully
consider all of such risk factors before making an investment decision with
respect to our common shares.

Item 2. Unregistered Sales of Equity Securities and Use of
Proceeds

None.

Item 3. Defaults Upon Senior Securities

None.

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Item 4. Submission of Matters to a Vote of Securities
Holders

None.

Item 5. Other Information

None.

Item 6. Exhibits

|Exhibit |                                                                                                                                                                                                                                                                    
|------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number  | Description                                                                                                                                                                                                                                                        
|(3)     | (i) Articles
        of Incorporation; and (ii) Bylaws                                                                                                                                                                                                             
|3.1     | Articles of Incorporation (incorporated
        by reference from our Registration Statement on Form S-1 filed on April
        7, 2008).                                                                                                                          
|3.2     | Bylaws (incorporated
        by reference from our Registration Statement on Form S-1 filed on April
        7, 2008).                                                                                                                                             
|(10)    | Material Agreements                                                                                                                                                                                                                                                
|10.1    | Share exchange
        agreement dated February 2, 2009 between our company and Guangdong Hongmao
        Industrial Co., Ltd. (incorporated by reference from our Current Report
        on Form 8-K filed on February 4, 2009).                                  
|10.2    | Amending Agreement to the Share
        Exchange Agreement dated August 24, 2009 between our company and Guangdong
        Hongmao Industrial Co., Ltd. (incorporated by reference from our Amended
        Current Report on Form 8-K/A filed on August 27, 2009).
|(14)    | Code of Ethics                                                                                                                                                                                                                                                     
|14.1*   | Code of Ethics and Business Conduct                                                                                                                                                                                                                                
|(31)    | Rule 13a-14(a)/15d-14(a)
        Certifications                                                                                                                                                                                                                    
|31.1*   | Certification
        of Principal Executive Officer and Principal Financial Officer filed pursuant
        to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                       
|(32)    | Section 1350
        Certifications                                                                                                                                                                                                                                
|32.1*   | Certification
        of Principal Executive Officer and Principal Financial Officer pursuant
        to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
        Act of 2002                                                      

* filed herewith

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SIGNATURES

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

| | FUTURE CANADA CHINA ENVIRONMENT INC.                               
| | -------------------------------------------------------------------
| |                                                                    
| |                                                                    
| |                                                                    
| | /s/ Rui Yang                                                       
| | Rui Yang                                                           
| | President, Secretary, Treasurer and Director                       
| | (Principal Executive Officer, Principal
      Financial Officer and
| | Principal                                                          
| | Accounting Officer)                                                
| | Date: October 13, 2009                                             

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