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

# FORM 10-QSB

# QUARTERLY REPORT UNDER
SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

# FOR THE QUARTERLY
PERIOD ENDED SEPTEMBER 30, 2006

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# Commission file number:
333-125542

Eliason Funding
Corporation (Exact Name of Small Business Issuer as Specified in its Charter)

|WISCONSIN                                | 20-1150223                             
|---------------------------------------- | ---------------------------------------
|(State of incorporation)                 | (I.R.S. employer identification number)
|548 Highway 155                         
|ST. GERMAIN, WISCONSIN                   | 54558                                  
|(Address of principal executive offices) | (Zip code)                             
|                                         |                                        

Issuers telephone
number, including area code: (715) 479-5535

Check 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 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. |X| Yes [_] No

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

State the number of shares
outstanding of each of the issuers classes of Common equity, as of the latest
practicable date: As of September 30, 2006, the issuer had 100 shares of common stock issued
and outstanding

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# ELIASON FUNDING
CORPORATIONFORM 10-QSB FOR THE QUARTER ENDED SEPTEMBER 30, 2006

|                                                                       
|-----------------------------------------------------------------------
|PART I. FINANCIAL INFORMATION                                          
|ITEM 1. Financial Statements                                           
|Statements of Financial Condition                                      
|September 30, 2006 (Unaudited) and December 31, 2005                   
|Statements of Operations (Unaudited)                                   
|Quarter ended and Nine Months ended September 30, 2006                 
|and September 30, 2005                                                 
|Statements of Changes in Stockholders' Equity (Unaudited)              
|Nine Months ended September 30, 2006 and September 30, 2005            
|Statements of Cash Flows (Unaudited)                                   
|Nine Months ended September 30, 2006 and September 30, 2005            
|Notes to Financial Statements                                          
|ITEM 2. Management's Discussion and Analysis of Financial Condition and
|Results of Operations                                                  
|ITEM 3. Controls and Procedures                                        
|PART II. OTHER INFORMATION                                             
|ITEM 6. Exhibits                                                       
|Signature                                                              
|302 Certification of Chief Executive Officer                           
|302 Certification of Principal Financial Officer                       
|906 Certification of Reporting Officers                                

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# PART I. FINANCIAL
INFORMATION

# ITEM 1. FINANCIAL
STATEMENTS

# ELIASON FUNDING
CORPORATION STATEMENTS OF
FINANCIAL CONDITION

|                                           | September 30, 2006 | December 31, 2005
|------------------------------------------ | ------------------ | -----------------
|
|ASSETS                                     |                    |                  
|Cash and cash equivalents                  |                    |                  
|Prepaid expenses                           |                    |                  
|Notes receivable - related party           |                    |                  
|                                           |                    |                  
|Total current assets                       |                    |                  
|                                           |                    |                  
|                                           |                    |                  
|LIABILITIES AND STOCKHOLDERS' EQUITY       |                    |                  
|Accounts payable and accrued expenses      |                    |                  
|                                           |                    |                  
|Notes payable - short-term                 |                    |                  
|                                           |                    |                  
|Total current liabilities                  |                    |                  
|                                           |                    |                  
|                                           |                    |                  
|Notes payable - long-term                  |                    |                  
|STOCKHOLDERS' EQUITY:                      |                    |                  
|Common stock                               |                    |                  
|Additional paid in capital                 |                    |                  
|Accumulated deficit                        |                    |                  
|                                           |                    |                  
|Total stockholders' equity                 |                    |                  
|                                           |                    |                  
|Total liabilities and stockholders' equity |                    |                  
|                                           |                    |                  

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

1

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# ELIASON FUNDING
CORPORATION STATEMENTS OF
OPERATIONS (Unaudited)

|                     | Three
Months Ended
September 30, 2006 | Three
Months Ended
September 30, 2005 | Nine
Months Ended
September 30, 2006 | Nine
Months Ended
September 30, 2005
|-------------------- | ------------------------------------- | ------------------------------------- | ------------------------------------ | ------------------------------------
|Revenues:            |                                       |                                       |                                      |                                     
|Interest income      |                                       |                                       | $                                    | 43,500                              
|                     |                                      
|Total revenues       |                                       |                                       |                                      | 43,500                              
|Expenses:            |                                       |                                      
|Legal and accounting |                                       |                                       |                                      | 29,666                              
|Advertising          |                                       |                                       |                                      | 367                                 
|Administrative       |                                       |                                       |                                      | 24,420                              
|Interest expense     |                                       |                                       |                                      | 42,382                              
|                     |                                      
|Total expenses       |                                       |                                       |                                      | 96,835                              
|                     |                                      
|NET LOSS             |                                       |                                       | $                                    | (53,335                             
|                     |                                      

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

2

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# ELIASON FUNDING
CORPORATION STATEMENTS OF CHANGES
IN STOCKHOLDERS EQUITY (Unaudited)

# For the Nine Months
Ended September 30, 2006

|                          
|--------------------------
|Balance December 31, 2005 
|Additional paid in capital
|Net loss                  
|                          
|Balance September 30, 2006
|                          

# For the Nine Months Ended
September 30, 2005

|                          
|--------------------------
|Balance December 31, 2004 
|Additional paid in capital
|Net loss                  
|                          
|Balance September 30, 2005
|                          

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

3

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# ELIASON FUNDING
CORPORATION STATEMENTS OF CASH
FLOWS (Unaudited)

|                                                                           
|---------------------------------------------------------------------------
|Cash flows from operating activities:                                      
|Net loss                                                                   
|Adjustments to reconcile net loss to net cash used in operating activities:
|Prepaid expenses                                                           
|Notes receivable-related party                                             
|Accounts payable and accrued liabilities                                   
|                                                                           
|Net cash used in operating activities                                      
|Cash flows from financing activities:                                      
|Borrowings on long-term debt                                               
|Contribution of capital                                                    
|                                                                           
|Net cash provided by financing activities                                  
|                                                                           
|NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS                       
|                                                                           
|Cash and cash equivalents at beginning of period                           
|                                                                           
|Cash and cash equivalents at end of period                                 
|                                                                           
|Supplemental disclosures of cash flow information:                         
|Cash paid during the year for:                                             
|Interest                                                                   

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

4

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# ELIASON FUNDING
CORPORATION NOTES TO FINANCIAL
STATEMENTS SEPTEMBER 30, 2006 (Unaudited)

# NOTE A 
ORGANIZATION AND PRESENTATION

Eliason Funding Corporation is a
State of Wisconsin Corporation that is headquartered in St. Germain, Wisconsin. The
Company provides financing to affiliated entities through the issuance of public debt.

The financial statements presented
herein are based on interim amounts. In the opinion of management, all adjustments
(consisting only of normal recurring accruals) necessary to present fairly the financial
position, results of operations and cash flows at September 30, 2006 and for all periods
presented have been made. The loss from operations for the period ended September 30, 2006
is not necessarily indicative of the operating results for the full year.

# NOTE B  SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES

# 1.      Use of Estimates

The preparation of financial
statements in conformity with accounting principles generally accepted in the United
States of America requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosures of contingent assets and
liabilities at the date of the financial statements and accompanying notes. Management
believes that the estimates utilized in preparing its financial statements are reasonable
and prudent. Actual results could differ from those estimates.

# 2.      Cash and Cash
Equivalents

The Company considers cash and cash
equivalents to include those investments with maturities of 90 days or less.

# 3.      Income Taxes

The Company has elected, for Federal
and state income tax purposes, to be treated as Qualified S-Corporation subsidiary under
the provisions of the Internal Revenue Code. Accordingly, the Companys taxable
income is included in the tax return of its parent company, Eliason, Inc.

# 4.      Revenue Recognition

The Company recognizes interest
income on notes receivable as it is earned.

# 5.      Notes Receivable

The Company records notes receivable
at their stated value as disclosed on the face of the note.

# 6.      Notes Payable

The Company records notes payable at their
stated value as disclosed on the face of the note.

5

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# NOTE B  SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

# 7.      Advertising

The Company expenses advertising as
incurred.

# 8.      Fair Value

All cash and cash equivalents and
notes receivable  related party are financial assts with a carrying value that
approximates fair market value. All accounts payable and accrued expenses and notes
payable are financial assets with a carrying value that approximates fair market value.

# 9.      Prospective
Accounting Pronouncements

In July 2006, the FASB issued FASB
Interpretation (FIN) No. 48,Accounting for Uncertainty in Income TaxesAn
Interpretation of FASB Statement No. 109 (FIN 48). This Interpretation
clarifies the accounting for uncertainty in income taxes recognized in a companys
financial statements. FIN 48 requires companies to determine whether it is more
likely than not that a tax position will be sustained upon examination by the
appropriate taxing authorities before any part of the benefit can be recorded in the
financial statements. It also provides guidance on the recognition, measurement and
classification of income tax uncertainties, along with any related interest and penalties.
FIN 48 will also require significant additional disclosures. This Interpretation will be
effective for fiscal years beginning after December 15, 2006. We will implement this
Interpretation in the first quarter of 2007 on a prospective basis. We are currently
evaluating the potential impact this Interpretation will have on our financial position
and results of operations.

# NOTE C  NOTES
RECEIVABLE  RELATED PARTY

As of September 30, 2006, the Company
had $1,692,500 in outstanding notes receivable from a related party.

$1,692,500 was loaned in several
notes to Eliason 1031 Properties Corporation (related party through common ownership) to
purchase or facilitate the purchase of properties in metropolitan Atlanta, Georgia, Troy,
Ohio and Stevens Point, Wisconsin. The notes bear interest at 9.5% to 12% per annum with
interest payments due quarterly. The notes mature in varying amounts between December 2006
and July 2007, but the notes are callable at anytime by the Company. The notes are
guaranteed by the stockholders of the related party.

# NOTE D  RELATED
PARTY TRANSACTIONS

The Company has a Management Services
agreement with Eliason, Inc. (a related party through common ownership) as described
below. The agreement calls for payments of $5,000 per month for management and accounting
services. The agreement is automatically renewed on an annual basis unless notification is
provided thirty days prior to the end of the year. Through September 30, 2006 a total of
$45,000 has been expensed under this agreement.

Notes receivable related parties
consist of the following at September 30, 2006:

6

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Eliason 1031 Properties
Corporation $1,692,500

Eliason, Inc., through subsidiaries,
is the parent Company of both Eliason 1031 Properties Corporation and Eliason Funding
Corporation.

The notes receivable from Eliason
1031 Properties Corporation (see Note C) bear interest at 9.5% to 12% per annum and
interest payments are due quarterly. The notes have stated due dates of December 31, 2006
and July 31, 2007, but the notes are callable at any time by the Company. The notes are
guaranteed by the stockholders of the related entities.

On January 13, 2005, the Company
entered into a Contribution Agreement with Eliason, Inc., Eliason Capital Group, Inc. and
Brian Eliason and David Eliason (related parties through common ownership). Under the
agreement, the related parties have agreed to fund the obligations of the Company as
necessary. For the nine months ended September 30, 2006, $150,000 has been contributed
under the terms of the agreement.

The Company leases office space from
Eliason Financial Group, LLC (related party through common ownership). The lease is on a
month-to-month basis at $200 per month beginning in August 2005. The lease was terminated
on August 31, 2006. Rent expense was $1,600 under the terms of the lease for the eight
months ended August 31, 2006.

# NOTE E  NOTES
PAYABLE

As of September 30, 2006, the Company
had outstanding notes payable of $1,982,500. These notes were issued under a public debt
offering beginning August 19, 2005. There are four classes of notes based upon their
maturity from issuance. The classes are Two-Year, Five-Year, Seven-Year and Ten-Year notes
with terms as follows:

|Class   | Maximum
Principal | Maturity | Rate | Notes Issued
|------- | ----------------- | -------- | ---- | ------------
|2-Year  |                   |          | $    | 4,000,000   
|5-Year  |                   |          | $    | 5,000,000   
|7-Year  |                   |          | $    | 6,000,000   
|10-Year |                   |          | $    | 6,000,000   
|        |                   |          |      |             
|        |                   |          |      |             
|        |                   |          |      |             

Future maturities consist of the
following at September 30, 2006:

|2007       |  |  | $ | 115,000   | 
|---------- |  |  | - | --------- | 
|2008       |  |  |   | 10,000    | 
|2009       |  |  |   | --        | 
|2010       |  |  |   | 105,000   | 
|2011       |  |  |   | 65,000    | 
|Thereafter |  |  |   | 1,687,500 | 
|           | 
|           |  |  | $ | 1,982,500 | 
|           | 

7

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# NOTE F  RESCISSION
OFFER

In April 2006, the Company discovered
that its former securities counsel had inadvertently failed to register the note offering
with certain state securities authorities. Due to this oversight, the Company suspended
selling notes on April 14, 2006 while a rescission offer was conducted to existing
noteholders and registered the note offering with the appropriate state securities
authorities. The rescission offer gave eligible noteholders the right to have the Company
repurchase their notes and to receive a refund of the principal plus a statutory amount of
interest. The rescission offer expired on July 26, 2006 and none of the eligible
noteholders chose to accept the rescission offer.

# NOTE G 
TERMINATION OF OFFERING

In August 2006, the Company decided
to terminate its public note offering and filed an amendment to its registration statement
deregistering the remaining $19,017,500 of unsold notes, effective September 7, 2006. The
Company will continue to make loans from the proceeds of the note offering collected to
date, and will continue to service the notes already sold.

# NOTE H  SUBSEQUENT
EVENT

From September 30, 2006 through
October 27, 2006 the Company issued an additional $301,500 of related party notes
receivable.

8

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# ITEM 2.    MANAGEMENT'S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

# CAUTIONARY STATEMENT
REGARDING FORWARD-LOOKING STATEMENTS

This
Form 10-QSB contains forward-looking statements within the meaning of that term in the
Private Securities Litigation Reform Act of 1995 (the Act) (Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934). Additional
written or oral forward-looking statements may be made by the Company from time to time in
filings with the Securities Exchange Commission, press releases, or otherwise. Statements
contained in this Form 10-QSB that are not historical facts are forward-looking statements
made pursuant to the safe harbor provisions of the Act. Forward-looking statements may
include, but are not limited to, projections of revenue, income or loss and capital
expenditures, statements regarding future operations, anticipated financing needs,
compliance with financial covenants in loan agreements, plans for acquisitions or sales of
assets or businesses, plans relating to products or services of the Company, assessments
of materiality, predictions of future events, the effects of pending and possible
litigation, and assumptions relating to the foregoing. In addition, when used in this Form
10-QSB, the words anticipates, believes, estimates,
expects, intends, plans and variations thereof and
similar expressions are intended to identify forward-looking statements.

Forward-looking
statements are inherently subject to risks and uncertainties, some of which cannot be
predicted or quantified based on current expectations. Consequently, future events and
actual results could differ materially from those set forth in, contemplated by, or
underlying the forward-looking statements contained in this Form 10-QSB, or in other
Company filings, press releases, or otherwise. In addition to the factors discussed in
this Form 10-QSB, other factors that could contribute to or cause such differences
include, but are not limited to, developments in any one or more of the following areas:
our borrowers ability to make payments to us, economic slowdowns in our market
areas, deterioration in the value of collateral used to secure loans made by us and other
risk factors which may be detailed from time to time in the Companys Securities and
Exchange Commission filings.

Readers
are cautioned not to place undue reliance on any forward-looking statements contained
herein, which speak only as of the date hereof. The Company undertakes no obligation to
publicly release the result of any revisions to these forward-looking statements that may
be made to reflect events or circumstances after the date hereof or to reflect the
occurrence of unexpected events.

General: On August 19, 2005,
we received approval to offer up to $21,000,000 in public notes. As of September 30, 2006,
notes totaling $1,982,500 had been sold and issued to the public. Of this amount,
$1,682,500 were Ten Year notes, $5,000 were Seven Year notes, $170,000 were Five Year
notes, and $125,000 were Two Year notes.

In August 2006, the Company decided
to terminate its public note offering and filed an amendment to its registration statement
deregistering the remaining $19,017,500 of unsold notes, effective September 7, 2006. The
Company will continue to make loans from the proceeds of the note offering collected to
date, and will continue to service the notes already sold.

9

---

Results of operations: As of
September 30, 2006, we reported a quarterly loss of $53,335 and a year-to-date loss of
$175,927. These losses were primarily the result of compliance costs, marketing efforts
directed at selling the notes and administrative expenses related to the Management
Services Agreement with Eliason, Inc. Additional expenditures related to compliance and
administration are anticipated.

# Quarter Ended
September 30, 2006 compared to the Quarter Ended September 30, 2005

Revenues:
Revenues totaled $43,500 for the quarter ended September 30, 2006 and $1,626 for the
quarter ended September 30, 2005. For the quarter ended September 30, 2006, $10,510 of the
income was earned on bank deposits and $32,990 was earned as the result of lending to
related parties the proceeds of our public debt offering. For the quarter ended September
30, 2005, with the exception of minor amounts derived from interest earned on bank
deposits, these were earned as the result of lending to related parties the proceeds of
our public debt offering. The total amount lent at September 30, 2006 was $1,692,500 and
$492,000 at September 30, 2005.

Legal and
accounting: Legal and accounting fees totaled $29,666 for the quarter ended
September 30, 2006 and $104,371 for the quarter ended September 30, 2005. Legal and
accounting fees for the quarter ended September 30, 2006 related to on-going regulatory
compliance requirements including preparing and conducting a rescission offer and the
necessary filings to terminate the offering. Legal and accounting fees for the quarter
ended September 30, 2005 related to the regulatory requirements of issuing the notes.

Advertising:
Advertising expenses totaled $367 for the quarter ended September 30, 2006 and $10,321 for
the quarter ended September 30, 2005. Advertising expenses for the quarter ended September
30, 2006 were negligible because we suspended our marketing efforts while we prepared and
conducted the rescission offer. Advertising expenses for the quarter ended September 30,
2005 were related to the initial costs of starting the advertising campaign.

Administrative:
Administrative expenses were $24,420 for the quarter ended September 30, 2006 and $35,062
for the quarter ended September 30, 2005. For the quarter ended September 30, 2006,
$15,000 was related to our Management Services Agreement with Eliason, Inc., $3,600 was
related to Directors and Officers Liability Insurance and $5,000 was related to trustee
fees. The remaining amounts were related to general administrative items such as postage
and office supplies. For the quarter ended September 30, 2005, $15,000 was related to the
Management Services Agreement with Eliason, Inc., $10,000 was related to trustee fees and
$5,000 was related to directors and officers liability insurance. The remaining amounts
were related to general and administrative items such as postage and office supplies.

Interest
expense: Interest expense was $42,382 for the quarter ended September 30,
2006 and $1,787 for the quarter ended September 30, 2005. Interest expense was related to
the issuance of public debt beginning August 19, 2005. The amount of public debt issued at
September 30, 2006 totaled $1,982,500. The interest rates on the notes sold to the public
are all fixed rates and range from 5.5% to 9.0%.

10

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# Nine Months Ended
September 30, 2006 compared to the Nine Months Ended September
30, 2005

Revenues:
Revenues totaled $141,485 for the nine months ended September 30, 2006 and $1,784 for the
nine months ended September 30, 2005. With the exception of minor amounts derived from
interest earned on bank deposits, these were earned as the result of lending to related
parties the proceeds of our public debt offering. For the nine months ended September 30,
2006, the revenue earned was primarily the result of receiving approval to issue public
notes on August 19, 2005, with the corresponding ability to lend those funds out. The
total amount lent at September 30, 2006 was $1,692,500.

Legal and
accounting: Legal and accounting fees totaled $111,185 for the nine months
ended September 30, 2006 and $176,554 for the nine months ended September 30, 2005. Legal
and accounting fees for the nine months ended September 30, 2006 related to on going
regulatory compliance requirements including issues related to preparing and conducting
our rescission offer and the necessary filings to terminate our offering. Legal and
accounting fees for the nine months ended September 30, 2005 related to the regulatory
requirements of issuing the notes.

Advertising:
Advertising expenses totaled $20,199 for the nine months ended September 30, 2006 and
$16,098 for the nine months ended September 30, 2005. Advertising expenses for the nine
months ended September 30, 2006 were related to the marketing campaign. During the
quarter ended September 30, 2006 they were negligible because we suspended our marketing
efforts while we prepared and conducted our rescission offer. Advertising expenses for the
nine months ended September 30, 2005 were related to the initial costs of starting the
advertising campaign.

Administrative:
Administrative expenses were $67,159 for the nine months ended September 30, 2006 and
$65,169 for the nine months ended September 30, 2005. For the nine months ended September
30, 2006, $45,000 was related to our Management Services Agreement with Eliason, Inc.,
$10,800 was related to Directors and Officers Liability Insurance and $5,000 was related
to trustee fees. The remaining amounts were related to general administrative items such
as postage and office supplies. For the nine months ended September 30, 2005, $45,000 was
related to the Management Services Agreement with Eliason, Inc., $10,000 was related to
trustee fees and $5,000 was related to directors and officers liability insurance. The
remaining amounts were related to general and administrative items such as postage and
office supplies.

Interest
expense: Interest expense totaled $118,869 for the nine months ended
September 30, 2006 and $1,787 for the nine months ended September 30, 2005. Interest
expense was related to the issuance of public debt beginning August 19, 2005. The amount
of public debt issued at September 30, 2006 totaled $1,982,500. The interest rates on the
notes sold to the public are all fixed rates and range from 5.5% to 9.0%.

# LIQUIDITY AND CAPITAL
RESOURCES

From
December 31, 2005 to September 30, 2006 cash and cash equivalents decreased by $7,614.
This was the result of $150,000 in capital contributions made by our parent company,
Eliason Capital Group, Inc., to cover operating activities and $424,500 in public debt
issued. These sources of cash were offset by $582,114 in cash used in operating
activities.

11

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Of
the $582,114 of cash used in operating activities, $2,087,500 was lent to a related party
as part of our normal business operations. $1,644,867 was repaid during the period
resulting in a net cash use of $442,633. The remaining cash used in operations of $139,481
was our loss for the nine months ended September 30, 2006 of $175,927 plus the increase in
prepaid expenses of $3,600 and offset by an increase in accounts payable and accrued
liabilities of $40,046.

Cash
provided from financing activities consisted of $424,500 of public debt issued from
December 31, 2005 through September 30, 2006 and $150,000 of capital contributions from
our parent corporation, Eliason Capital Group, Inc.

On
January 13, 2005, we entered into a Contribution Agreement with Eliason, Inc, Eliason
Capital Group, Inc, and Brian and David Eliason (related parties). Under the Contribution
Agreement, the related parties have agreed to fund our obligations as necessary.

At
September 30, 2006, we were still reliant upon our parent corporation for capital
contributions to meet our operating cash flow needs, without depleting the principal
received from the issuance of the public debt. Pursuant to the Contribution Agreement
cited above, we expect to rely upon this agreement until the first quarter of 2007, after
which we believe cash flow will be sufficient to pay the interest owed and cover
administrative expenses. We believe this will be the case because of the lowered
administrative, accounting and legal expenses as the result of the termination of our
offering, which also results in no advertising costs going forward.

In
April 2006, we discovered that our former securities counsel had inadvertently failed to
register our note offering with certain state securities authorities. Due to this
oversight, we suspended selling notes on April 14, 2006 while we conducted a rescission
offer to our existing noteholders and registered our note offering with the appropriate
state securities authorities. The rescission offer gave eligible noteholders the right to
have us repurchase their notes and to receive a refund of the principal plus a statutory
amount of interest. The rescission offer expired on July 26, 2006 and none of the eligible
noteholders chose to accept the rescission offer.

12

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# THE POTENTIAL IMPACT OF
KNOWN FACTS, COMMITMENTS, EVENTS AD UNCERTAINTIES

Off-balance sheet
arrangements: As of September 30, 2006, we did not have any off-balance sheet
arrangements.

Contractual Obligations:There
were no material changes outside the ordinary course of our business to contractual
obligations during the three months period ended September 30, 2006.

Critical Accounting Policies:There were no changes in our critical accounting policies during the three month
period ended September 30, 2006.

# ITEM 3. CONTROLS AND
PROCEDURES

Under
the supervision and with the participation of our management, including our principal
executive officer and principal financial officer, we conducted an evaluation of the
effectiveness of the design and operation of our disclosure controls and procedures, as
defined in Rules 13a-14(c) and 15d-14(c) under the Securities Exchange Act of 1934, as of
September 30, 2006 (the Evaluation Date). Based upon this evaluation, our
principal executive officer and principal financial officer concluded as of the Evaluation
Date that our disclosure controls and procedures were effective such that the material
information required to be included in our Securities and Exchange Commission
(SEC) reports is recorded, processed, summarized, and reported within the time
periods specified in SEC rules and forms relating to the Company, including, our
consolidated subsidiaries, and was made known to them by others within those entities,
particularly during the period when this report was being prepared.

In addition, there were no
significant changes in our internal controls or in other factors that could significantly
affect these controls subsequent to the Evaluation Date. We have not identified any
significant deficiencies or material weaknesses in our internal controls, and therefore,
there were no corrective actions taken.

13

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# PART II. OTHER
INFORMATION

# ITEM 6: EXHIBITS

# INDEX TO EXHIBITS

|EXHIBIT
NUMBER | DESCRIPTION                                                                                   
|-------------- | ----------------------------------------------------------------------------------------------
|3.1            | Articles of Incorporation (1)                                                                 
|3.2            | Bylaws (1)                                                                                    
|4.1            | Form of Indenture between Eliason Funding Corporation and US Bank, national Association, as   
|               | Trustee (2)                                                                                   
|10.1           | Form of Management Services Agreement between Eliason Funding Corporation and Eliason, Inc.,  
|               | dated October 31, 2004 (1)                                                                    
|10.2           | Form of Contribution Agreement between Eliason Funding Corporation, Brian Eliason, David      
|               | Eliason, Eliason, Inc. and Eliason Capital Group, Inc., dated January 13, 2005 (2)            
|31.1           | Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 
|               | 2002                                                                                          
|31.2           | Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act
|               | of 2002                                                                                       
|32             | Certification of Reporting Officers pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 

|(1) | Incorporated by reference from Registration Statement on Form SB-2 of Eliason
          Funding Corporation Registration No. 333-125542, filed June 6, 2005.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Incorporated by reference from Amendment No. 1 to Registration Statement on Form
          SB-2 of Eliason Funding Corporation Registration No. 333-125542, filed July 27,
          2005.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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---

# SIGNATURE

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

# ELIASON FUNDING
CORPORATION

(Registrant)

|Date: November 3, 2006 | /s/ David J. Eliason       
|---------------------- | ---------------------------
|                       |                            
|                       | David J. Eliason, President

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