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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM l0-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 for the quarterly period ended SEPTEMBER 30, 2009
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE AC T OF 1934
 for the transition period from  to
 Commission File Number. 0-15113
 VERITEC, INC.
 (Exact name of Registrant as Specified in its Charter)
 Nevada
    
    95-3954373(State or Other Jurisdiction of 
Incorporation or Organization)
    
    (IRS Employer
Identification No.)2445 Winnetka Avenue N. Golden Valley, MN
    
    55427(Address of principal executive offices)
    
    (Zip Code)
  þ o
 o o
  Large Accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company þ(Do not check if a smaller reporting company)
 Yes o No þ
 Yes þ No o




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TABLE OF CONTENTS
 Page No.PART I
    
    
    3ITEM 1 FINANCIAL STATEMENTS
    
    
    3ITEM 2 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
    
    
    10ITEM 3 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
    
    
    12ITEM 4 CONTROLS AND PROCEDURES
    
    
    12PART II
    
    
    13ITEM 1 LEGAL PROCEEDINGS
    
    
    13ITEM 1A RISK FACTORS
    
    
    13ITEM 6 EXHIBITS
    
    
    13SIGNATURES
    
    
    13Exhibit 31.1Exhibit 31.2Exhibit 32.1




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ITEM 1
    
    FINANCIAL STATEMENTS
 VERITEC, INC. AND SUBSIDIARIES  CONDENSED CONSOLIDATED BALANCE SHEETS
 September 30,
    
    
    June 30,2009
    
    
    2009(Unaudited)ASSETSCurrent Assets:Cash
    
    $
    53,384
    
    
    $
    50,019Accounts receivable, net of allowance of $8,400
    
    
    64,273
    
    
    
    28,376Inventories
    
    
    3,829
    
    
    
    6,217Prepaid expenses
    
    
    16,656
    
    
    
    23,281Employee advances
    
    
    6,900
    
    
    
    8,500Total Current Assets
    
    
    145,042
    
    
    
    116,393Property and Equipment, net
    
    
    80,726
    
    
    
    93,292Other assets
    
    
    43,756
    
    
    
    43,756Total Assets
    
    $
    269,524
    
    
    $
    253,441LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)Current Liabilities:Notes payable
    
    $
    1,360,027
    
    
    $
    20,039Accounts payable
    
    
    304,955
    
    
    
    187,368Accrued expenses
    
    
    256,884
    
    
    
    353,161Total Current Liabilities
    
    
    1,921,866
    
    
    
    560,568Notes Payable
    
    
    100,034
    
    
    
    885,673Commitments and ContingenciesStockholders Equity:Convertible preferred stock, par value $1.00;
authorized 10,000,000 shares, 276,000 shares of
Series H authorized, 1,000 shares issued
    
    
    1,000
    
    
    
    1,000Common stock, par value $.01; authorized
20,000,000 shares, 16,315,088 and 16,165,088
shares issued
    
    
    163,151
    
    
    
    161,651Additional paid-in capital
    
    
    14,092,430
    
    
    
    13,943,046Accumulated deficit
    
    
    (16,008,957
    )
    
    
    (15,298,497
    )Total Stockholders Deficit
    
    
    (1,752,376
    )
    
    
    (1,192,800
    )Total Liabilities and Stockholders Equity (Deficit)
    
    $
    269,524
    
    
    $
    253,441
   Page 3 of 13




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VERITEC, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 Three months ended September 30,2009
    
    
    2008License and other revenue
    
    $
    200,641
    
    
    $
    432,532Cost of Sales
    
    
    159,459
    
    
    
    63,596Gross Profit
    
    
    41,182
    
    
    
    368,936Operating Expenses:Selling, general and administrative
    
    
    536,411
    
    
    
    321,376Research and development
    
    
    188,005
    
    
    
    99,095Total Operating Expenses
    
    
    724,416
    
    
    
    420,471Loss from Operations
    
    
    (683,234
    )
    
    
    (51,535
    )Other Income:Interest income
    
    
    29
    
    
    
    1,061Interest expense
    
    
    (27,255
    )
    
    
    Total Other Income
    
    
    (27,226
    )
    
    
    1,061Net Loss
    
    $
    (710,460
    )
    
    $
    (50,474
    )Loss Per Common ShareBasic and Diluted
    
    $
    (0.05
    )
    
    $
    (0.00
    )
   Page 4 of 13




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VERITEC, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 Three months ended September 30,2009
    
    
    2008CASH FLOWS FROM OPERATING ACTIVITIESNet loss
    
    $
    (710,460
    )
    
    $
    (50,474
    )Adjustments to reconcile net loss to net cash used by operating activities:Depreciation
    
    
    12,566
    
    
    
    9,721Amortization of debt issuance cost
    
    
    771
    
    
    
    Amortization of discount on notes payable
    
    
    3,306
    
    
    
    Stock compensation
    
    
    113,384
    
    
    
    1,171Interest added to notes payable
    
    
    23,772
    
    
    
    Changes in operating assets and liabilities:Accounts receivable
    
    
    (35,897
    )
    
    
    (57,911
    )Employee advances
    
    
    1,600
    
    
    
    Inventories
    
    
    2,388
    
    
    
    14,676Prepaid expenses
    
    
    6,625
    
    
    
    Accounts payables and accrued expenses
    
    
    58,810
    
    
    
    62,917Net cash used by operating activities
    
    
    (523,135
    )
    
    
    (19,900
    )CASH FLOWS FROM INVESTING ACTIVITIESPurchase of property and equipment
    
    
    
    
    
    
    (906
    )CASH FLOWS FROM FINANCING ACTIVITIESProceeds from notes payable
    
    
    591,500
    
    
    
    Payments on notes payable
    
    
    (65,000
    )
    
    
    Net cash provided by financing activities
    
    
    526,500
    
    
    
    NET INCREASE (DECREASE) IN CASH
    
    
    3,365
    
    
    
    (20,806
    )CASH AT BEGINNING OF PERIOD
    
    
    50,019
    
    
    
    334,702CASH AT END OF PERIOD
    
    $
    53,384
    
    
    $
    313,896SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATIONCash paid for interest
    
    $
    177
    
    
    $
    NONCASH ACTIVITIESIssuance of common stock for accrued expenses
    
    $
    37,500
    
    
    $
    Debt issuance cost netted to proceeds from note payable
    
    
    9,250
    
    
    
    
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® ®
 ® ® ® ® ®
 ® ®
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®
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Numberof
    
    
    Weighted  AverageShares
    
    
    Exercise PriceOutstanding at June 30, 2009
    
    
    721,749
    
    
    $
    0.49Granted
    
    
    97,500
    
    
    $
    0.38Outstanding at September 30, 2009
    
    
    819,249
    
    
    $
    0.48
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Determination of the Useful Life of Intangible
Assets Business Combinations,
 The FASB Accounting Standards Codification and
the Hierarchy of Generally Accepted Accounting Principles The
Hierarchy of Generally Accepted Accounting Principles
      Page 9 of 13




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ITEM 2
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 Results of Operations  September 30, 2009 compared to September 30, 2008
    Cost of Goods Sold
  Operating Expenses
    Other Income (Expense)
   Page 10 of 13




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Liquidity
   Commitments and Contractual Obligations
    Off-Balance Sheet Arrangements
  Critical Accounting Policies
        Page 11 of 13




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ITEM 3
    
    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
  
 ITEM 4
    
    CONTROLS AND PROCEDURES
 Disclosure Controls and Procedures
     Internal Control over Financial Reporting
   Page 12 of 13




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ITEM 1
    
    LEGAL PROCEEDINGS
  
 ITEM 1A
    
    RISK FACTORS
  
 ITEM 6
    
    EXHIBITS
 31.1
    
    
    CEO Certification required by Rule 13a14(a)/15d14(a) under the Securities Exchange Act of
1934.31.2
    
    
    CFO Certification required by Rule 13a14(a)/15d14(a) under the Securities Exchange Act of
1934.32.1
    
    
    Veritec, Inc. Certification of CEO/CFO pursuant to Section 906 of the Sarbanes-Oxley Act of
2002 (18 U.S.C. §1350).
 
 SIGNATURES
  VERITEC, INC.By
    
    /s/ Jeffrey Hattara

Jeffrey Hattara
    
    November 16, 2009President, Chief Executive Officer and Interim Chief Financial OfficerBy
    
    /s/ Van Tran
    
    November 16, 2009Van TranExecutive Chairman of the Board
  Page 13 of 13