U.S. Securities and Exchange Commission
                             Washington, D.C. 20549
--------------------------------------------------------------------------------
                                  FORM 10-KSB/A
                                (Amendment No. 1)

[X]   Annual report under Section 13 or 14(d) of the Securities Exchange Act of
      1934 for the fiscal year ended December 31, 2004.

[_]   Transition report under Section 13 or 15(d) of the Securities Exchange Act
      of 1934 for the transition period from          to

                        Commission File Number: 000-27507

                                  AUXILIO, INC.
                 (Name of Small Business Issuer in its Charter)

                Nevada                                 88-0350448
    (State or other jurisdiction of                 (I.R.S. Employer
    incorporation or organization)                 Identification No.)

           27401 Los Altos, Suite 100, Mission Viejo, California 92691
           -----------------------------------------------------------
                    (Address of principal executive offices)

                                 (949) 614-0700
                                 --------------
                           (Issuer's telephone number)

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

             Securities registered under Section 12(g) of the Act:

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

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

      Check if there is no disclosure of delinquent filers in response to Item
405 of Regulation S-B contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [_]

      Issuer's revenues for the year ended December 31, 2004 were $7,281,809.

      The aggregate market value for the Issuer's voting stock held by
non-affiliates of the Issuer based upon the $1.79 per share closing sale price
of the Common Stock on March 23, 2006 as reported on the Over-the-Counter
Bulletin Board, was approximately $25,374,272. Shares of Common Stock held by
each officer and director and by each person who owns 5% or more of the
outstanding common stock have been excluded in that such persons may be deemed
to be affiliates. This determination of affiliate status is not necessarily a
conclusive determination for other purposes.

      As of March 23, 2006, Registrant had 15,961,410 shares of Common Stock
outstanding.


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<PAGE>

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


                                Explanatory Note

      We are filing this Amendment to our Annual Report on Form 10-KSB for the
fiscal year ended December 31, 2004, as filed with the U.S. Securities and
Exchange Commission (SEC) on April 19, 2005 in response to a request by the SEC
to make certain changes to the disclosure in Item 8A Controls and Procedures.

      Other than the change referred to above, all other information included in
the above described Form 10-KSB remains unchanged. This amendment does not
reflect events occurring after the filing of such Form 10-KSB and does not
modify or update the disclosures therein in any way other than as required to
reflect the amendment as described above and set forth below.


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<PAGE>

Item 8A.      Controls and Procedures

      We maintain disclosure controls and procedures that are designed to ensure
that information required to be disclosed in our Securities Exchange Act reports
is recorded, processed, summarized and reported within the time periods
specified in the SEC's rules and forms, and that such information is accumulated
and communicated to our management, including our chief executive officer and
chief financial officer, to allow timely decisions regarding required
disclosure. In designing and evaluating the disclosure controls and procedures,
management recognized that any controls and procedures, no matter how well
designed and operated, can provide only reasonable assurance of achieving the
desired control objectives, as ours are designed to do, and management
necessarily was required to apply its judgment in evaluating the cost-benefit
relationship of possible controls and procedures.

      As of December 31, 2004, an evaluation was performed under the supervision
and with the participation of our management, including our chief executive
officer and chief financial officer, of the effectiveness of the design and
operation of our disclosure controls and procedures..

      Our independent registered public accounting firm, Stonefield Josephson,
Inc., advised us in connection with the completion of their audit for the year
ended December 31, 2004, that they had identified certain matters involving the
operation of our internal controls that they consider to be a material weakness.
A "material weakness" is a reportable condition in which the design or operation
of one or more of the internal control components does not reduce to a
relatively low level the risk that misstatements caused by errors in amounts
that would be material in relation to the consolidated financial statements
being audited may occur and not be detected within a timely period by employees
in the normal course of performing their assigned functions.

      The deficiency in our internal controls, as noted above, related to the
timely reconciliation of income taxes required by SFAS No. 109. The unrecorded
transactions and disclosure deficiency was detected in the audit process and has
been appropriately recorded and disclosed in this Form 10-KSB.

      The matter identified by Stonefield Josephson, Inc. has been reviewed with
management and with the Audit Committee. Management believes that the material
weakness identified by Stonefield Josephson, Inc. was attributable in
significant part to the purchase of The Mayo Group resulting in positive income
requiring a tax provision calculation and our lack of internal accounting and
finance personnel that possess technical expertise required to calculate a
complex tax provision.

      We have implemented the following changes that have a material affect on
our internal controls and procedures as they relate to financial reporting to
respond to these matters. Our responsive actions include the engagement of a
consultant to assist the Company with complex accounting issues including the
tax provision, the hiring of a new chief financial officer that has experience
in dealing with complex accounting issues and recruiting to increase staffing
levels in certain areas of the finance organization.

      Our certifying officers believe that we have implemented sufficient
compensating controls to minimize the risks associated with this material
weakness identified by our independent auditors.

Based on management's evaluation, and including consideration of the matter
identified above, we believe the disclosure controls and procedures are
effective.


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<PAGE>

Item 13.      Exhibits

Exhibits

<TABLE>
<CAPTION>
-------------- ---------------------------------------------------------------------------------------------------------------
No.            Item
-------------- ---------------------------------------------------------------------------------------------------------------
<S>            <C>
2.1            Agreement and Plan of Reorganization dated as of November 20, 2001, by and between the Company and
               e-Perception, Inc. (incorporated by reference to Exhibit 1.1 to the Registrant's Form 8-K filed on January
               24, 2002).
-------------- ---------------------------------------------------------------------------------------------------------------
2.2            Agreement and Plan of Merger, dated April 1, 2004, by and between Auxilio, Inc., PPVW Acquisition
               Corporation, and Alan Mayo & Associates, Inc. (filed as Exhibit 2.1 to the Registrant's Form 8-K filed on
               April 16, 2004).
-------------- ---------------------------------------------------------------------------------------------------------------
3.1            Certificate of Incorporation
-------------- ---------------------------------------------------------------------------------------------------------------
3.2            Bylaws (incorporated by reference to Exhibit 2 to the Registrant's Form 10-SB filed on October 1, 1999).
-------------- ---------------------------------------------------------------------------------------------------------------
4.1            Subscription Agreement, dated as of January 9, 2002, by and among the Company and each of the stockholders of
               e-Perception, Inc. (incorporated by reference to Exhibit 1.1 to the Registrant's Form 8-K filed on January
               24, 2002).
-------------- ---------------------------------------------------------------------------------------------------------------
10.1           2000 Stock Option Plan
-------------- ---------------------------------------------------------------------------------------------------------------
10.2           2001 Stock Option Plan
-------------- ---------------------------------------------------------------------------------------------------------------
10.3           2003 Stock Option Plan
-------------- ---------------------------------------------------------------------------------------------------------------
10.4           2004 Stock Option Plan
-------------- ---------------------------------------------------------------------------------------------------------------
10.5           Standard Office Lease by and between Arden Realty Limited Partnership and e-Perception Technologies, Inc.
               (incorporated by reference to Exhibit 10.1 to the Registrant's Form 10-QSB filed on May 15, 2002).
-------------- ---------------------------------------------------------------------------------------------------------------
10.6           Asset Purchase Agreement between Workstream USA, Inc., Workstream, Inc. and PeopleView, Inc. dated March 8,.
               2004 (incorporated by reference to Exhibit 2.1 to the Registrant's Form 8-K filed on April 2, 2004).
-------------- ---------------------------------------------------------------------------------------------------------------
10.7           Addendum dated as of May 27, 2004 to Asset Purchase Agreement dated March 17th, 2004 between Workstream Inc.
               Workstream USA, Inc. and PeopleView, Inc. (incorporated by reference to Exhibit 2.1 to the Registrant's Form
               8-K/A filed on August 3, 2004).
-------------- ---------------------------------------------------------------------------------------------------------------
10.8           Revolving Loan and Security Agreement between Auxilio, Inc. and Michael D. Vanderhoof (filed as Exhibit 10.1
               to the Registrant's Form 8-K filed on December 29, 2004).
-------------- ---------------------------------------------------------------------------------------------------------------
10.9           Executive Employment Agreement between Registrant and Etienne Weidemann, President and Chief Operating
               Officer dated April 1, 2004.
-------------- ---------------------------------------------------------------------------------------------------------------
10.10          Executive Employment Agreement between Registrant and Joseph J Flynn, Chief Executive Officer and Chairman of
               the Board of Directors dated April 1, 2004.
-------------- ---------------------------------------------------------------------------------------------------------------
10.11          Executive Employment Agreement between Registrant and James Stapleton, Chief Financial Officer and Corporate
               Secretary dated April 1, 2004.
-------------- ---------------------------------------------------------------------------------------------------------------
10.12          Executive Employment Agreement between Registrant and Paul T. Anthony, Chief Financial Officer and Corporate
               Secretary dated December 10, 2004.
-------------- ---------------------------------------------------------------------------------------------------------------
10.13          Standard Office Lease agreement by and between Auxilio, Inc and McMorgan Institutional Real Estate Fund I,
               LLC. dated October 13, 2004.
-------------- ---------------------------------------------------------------------------------------------------------------
14             Registrants Code of Ethics (incorporated by reference to Exhibit 14.1 to the Registrant's Form 10-KSB filed
               on April 14, 2004).
-------------- ---------------------------------------------------------------------------------------------------------------
16             Letter regarding change in certifying accountants dated February 14, 2002 (incorporated by reference to
               Exhibit 16 to the Registrant's Form 8-K filed on February 15, 2002).
-------------- ---------------------------------------------------------------------------------------------------------------
21.1           Subsidiaries
-------------- ---------------------------------------------------------------------------------------------------------------
31.1           Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) and rule 15d-14(a).
-------------- ---------------------------------------------------------------------------------------------------------------
31.2           Certification  of the Chief Financial  Officer  pursuant to Rule 13a-14(a) and rule 15d-14(a).
-------------- ---------------------------------------------------------------------------------------------------------------
32.1           Certification of the CEO and CFO pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of The
               Sarbanes-Oxley Act of 2002 (incorporated by reference to Exhibit 32.1.1 to the Registrant's Form 10-KSB filed
               on April 19, 2005).
-------------- ---------------------------------------------------------------------------------------------------------------
</TABLE>


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<PAGE>

                                   Signatures

      In accordance with section 13 or 15(d) with the Securities Exchange Act of
1934, the Company has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized, on the 28th day of March 2006.

                                      AUXILIO, Inc.

                                      By: /s/ Joseph Flynn
                                          ----------------
                                      Joseph Flynn
                                      Chief Executive Officer
                                      Principal Executive Officer

                                      By: /s/ Paul T. Anthony
                                          -------------------
                                      Paul T. Anthony
                                      Chief Financial Officer
                                      Principal Financial Officer

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

     Signature                       Title                           Date
     ---------                       -----                           ----


/s/ Joseph Flynn                Chief Executive Officer
----------------                (Principal Executive Officer      March 28, 2006
Joseph Flynn                    and Director)


/s/ Paul T. Anthony             Chief Financial Officer           March 28, 2006
-------------------             (Principal Financial and
Paul T. Anthony                 Accounting Officer)


/s/ Michael Vanderhoof          Director                          March 28, 2006
----------------------
Michael Vanderhoof


/s/ John D. Pace                Director                          March 28, 2006
----------------
John D. Pace


/s/ Robert L. Krakoff           Director                          March 28, 2006
---------------------
Robert L. Krakoff


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