SECURITIES AND EXCHANGE
COMMISSION WASHINGTON, D.C.
20549 FORM 10-KSB  [x] Annual
Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934  For the fiscal year ended
June 30, 2007  [ ] Transition Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 For the transition period
from
 to  Commission File Number
0-27835  COZUMEL
CORPORATION (Exact name of small
business issuer in its charter)  DELAWARE  33-0619262 (State
or other jurisdiction of incorporation or organization)  (I.R.S. Employer
                                                                                                                                 Identification
No.) 24351
Pasto Road, Suite B Dana
Point, California 92629 (Address
of principal executive offices) (Zip
Code)  Registrant's telephone
number, including area code:
         (949)
489-2400 Securities registered
pursuant to Section 12(b) of the Act:
 None Securities registered
pursuant to Section 12(g) of the Act:  Common Stock, par value
$.001  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.  YES X      NO  Check
if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not 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-K
or any amendment to this Form 10-K. [ X ]  Indicate by check mark whether the Registrant is a shell company
(as defined in Rule 12b-2 of the Exchange Act).    Yes  [
   ]    No  [  X  ]  State
issuer's revenues for its most recent fiscal year: None  The
aggregate market value of the voting stock held by non-affiliates of the
registrant as of June 30, 2007 was not determinable since the Common Stock was
not traded.  The
number of shares outstanding of the issuer's classes of Common Stock as of June
30, 2007:  Common Stock, $.001 Par Value - 1,000,000 shares  PART I  Item 1. DESCRIPTION OF BUSINESS  Background  Cozumel
Corporation, a Delaware corporation (the "Company") was incorporated on April
20, 1994.  Until January 2005, the Company had no operating history other
than organizational matters, and was formed specifically to be a "clean public
shell" and for the purpose of either merging with or acquiring an operating
company with operating history and assets.  On January 25, 2005, the
Company organized a Florida subsidiary, Cozumel Yacht Brokers, Inc. (Cozumel
Yachts and collectively with the Company, Cozumel or we) and entered the
business of refitting and reselling yachts for its own account and carrying on
yacht brokerage activities incidental to that business.  We do not at this
time refit yachts for other parties although we are considering doing so, and we
are no longer seeking to acquire any other business.  The
executive offices of the Company are located at 24351 Pasto Road, Suite B, Dana
Point, California 92629.  Its telephone number is (949) 489-2400.  Yacht Refit
Business  We
purchase, refit or repair yachts and market them for resale. Our first and main
project is a Burger Aft cockpit motor yacht originally launched in 1965. This
yacht has an aluminum hull and superstructure, with an overall length of 74.
The Burger is being completely refit, with new propulsion, mechanical and
electrical systems and cosmetic renewal. Most of the basic structure has been
retained, but otherwise the Burger will be functionally a brand new boat. The
refit is expected to be completed 6 months from the time we obtain the remaining
funds at which time it will be marketed for sale.  The Burger Boat Company
is a well established brand of luxury yachts which is still in business and has
an excellent reputation. We do not have any relationship with Burger Boat
Company or any other manufacturer mentioned herein.  We have
several other projects of lesser magnitude. We purchased a 60 Nautical sailboat
at a U.S. Marshalls auction in late 2005 which was repaired and upgraded. We
also purchased a 52 Hatteras yacht at the U.S. Marshalls auction in late 2005.
We have purchased two smaller sailboats for refit, one of which we sold to our
President for a nominal amount of cash during fiscal 2006 and for services
rendered.  The second sailboat, a Pacific Seacraft 20, was acquired in
June 2006 as a salvage boat (it suffered minor hurricane damage from Hurricane
Katrina) and we completed its repair in October 2006. None of these yachts have
been sold to date.  Generally, in selecting yachts for refit, we try to choose those
with no serious structural problems from well regarded manufacturers. For
example, although the 20 sailboat mentioned above is a small yacht, it is
extremely well built and commands a premium in the used boat market. In our
opinion there is no better 20 sailboat commercially manufactured.  We try
to buy for an attractive price and generally hear of acquisition opportunities
by word of mouth.    Refit
Operations  Refit
operations are carried out at a Miami boatyard, where we rent approximately
1,000 square feet of workshop space and the required boat slips. We have a crew
of 8-10 persons supervised by a project manager. Our crew includes marine
craftsmen but from time to time, specialty tradesmen such as welders or engine
mechanics are engaged for specific repair items.  South Florida, including
Miami, Fort Lauderdale and the surrounding cities is one of the major yachting
regions in the United States, with a complete range of craftsmen and marine
suppliers. However, the 2005 hurricane season severely affected south Florida.
Although none of our operations or assets suffered damage, many yachts were
damaged in 2005, leading to a shortage of tradesmen. This shortage was
alleviated by summer of 2006; however, a repeat of a hurricane season like 2005
could result in another shortage. In early 2007, we suspended refit operations
for two reasons. First, because our public listing was delayed, we were unable
to obtain the required funding to complete the refit of the Burger. Secondly,
the owner of the boatyard determined to prohibit owner refit work at the
boatyard for larger boats. We have not yet found an alternative boatyard for our
activities and will not do so until we have sufficient funding.  Marketing  We
market our yachts through yacht brokerage and co-brokerage agreements. We have
developed a web site at cozumelyachts.com and cozumelyachtbrokers.com.  To
date we have not had sufficient funds to do so, but we intend in the future to
advertise our yachts in print media and at boat shows. We may employ
professional yacht brokers on a commission basis to market them as well.  Employees  The
Company's only employee at the present time is its sole officer and director,
who will devote as much time as the Board of Directors determine is necessary to
carry out the affairs of the Company.  (See "Management"). Remaining
consultants and craftsmen are paid as independent contractors.  Competition  Competition within the yacht repair and refitting industry is
intense. We face competition at the local, regional, national and international
levels. Our largest competitors for yacht refitting include several large
boatyards in the southeastern U.S., but we also compete with innumerable
independent persons who buy and fix up boats. We have tried to find a niche by
emphasizing quality and by keeping our costs down.  However, foreign repair
facilities (Venezuela, for example) have much lower labor costs and do not need
to meet U.S. environmental standards.  To the extent that we are buying and selling the yachts for our
own account, we compete with innumerable boat dealers and brokers and individual
sellers, as well as new boat manufacturers.   Regulations  Certain materials used in boat manufacturing are toxic, flammable,
corrosive or reactive and classified by state and federal governments as
"hazardous materials". Control of hazardous materials is regulated by the U.S.
Environmental Protection Agency and state environmental protection agencies. If
it is ever determined that our operations have resulted in hazardous waste
contamination, the costs of cleaning up those wastes could be substantial and
could have a material adverse effect on our business, financial condition and
results of operations. We cannot predict our future regulatory compliance costs
with precision and we cannot be certain of any costs that we may be forced to
incur in connection with our historical on-site or off-site waste disposal.  Certain states have required or are considering requiring a
license to operate a recreational boat. These licensing requirements are not
expected to be unduly restrictive. They may, however, discourage potential
first-time buyers, which could, in turn, adversely affect our business. In
addition, certain state and local governmental authorities are contemplating
regulatory efforts to restrict boating activities on certain inland bodies of
water. While the scope of these potential regulations is not yet known, their
adoption and enforcement could have a material adverse effect on our
business.  Effect of Fuel Prices and General Economy  Almost all higher end yachts are powered by diesel engines. A
significant increase in the price or tax on the sale, or an interruption in the
supply of diesel fuel on a regional, national or international basis could
adversely affect our sales and operating results. At various times in the past,
diesel or gasoline fuel has been difficult to obtain, and we cannot assure you
that the supply of those fuels will not be interrupted. In 2007, fuel prices did
increase substantially and, in conjunction with the real estate crisis in South
Florida, the resale market for yachts has been severely affected. Until the
market recovers, we will have a difficult time moving inventory.  Sales trends in the recreational boating industry are influenced
by several factors, including general economic growth, consumer confidence,
spending habits and household income and net worth levels. Interest rates and
fuel prices also have a direct impact on boat sales, as well as demographic
trends at the local, regional and national level. Competition from other leisure
and recreational activities, such as vacation properties and travel, can also
affect sales of recreational boats.  We target a narrow market of wealthy
or very wealthy individuals who can afford yachts. We believe that sales of
recreational power boats have grown steadily since 1971, except for the 1989 to
1992 time frame. During that four-year period, the effects of a recession, the
imposition of a luxury tax, and other adverse political and economic events had
a material adverse impact on sales of all boats, but particularly in the upper
end of the segment including cruisers and luxury yachts. Currently the industry
is in a severe downturn, and we do not know when the industry will recover.  Item 2. DESCRIPTION OF PROPERTY  The
Company shares administrative space with its sole officer.  The Company
pays its own charges for long distance telephone calls and other miscellaneous
secretarial, photocopying and similar expenses. The Company rented workshop
space through 2006 and rents boat slips as needed on a month-to-month basis at
several boatyards in the Miami area. We have the use of sales facilities
provided by our President without charge in St. John, USVI and on Antigua, WI to
accommodate potential foreign purchasers.  Item 3. LEGAL PROCEEDINGS  Not
Applicable.  Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS  No
matters were submitted to a vote of security holders during the fourth quarter
of the fiscal year ended June 30, 2007.  PART II   Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
STOCK­HOLDER MATTERS  The
Company's Common Stock has not traded.  As of June 30, 2007, there were 111
stockholders of record.  Sales of Unregistered Securities -  Not
Applicable.  Report of Offering of Securities and Use of Proceeds
Therefrom.  -  not applicable  Company repurchases of common stock during the year ended June
30, 2007.  There were no Company repurchases of common stock during the year
ended June 30, 2007. Not Applicable.    Equity Compensation Plans  We have no equity compensation plans. Securities and Exchange Commission Rule 15g Our Companys shares are covered by Rule 15g of the Securities and
Exchange Act of 1934, as amended that imposes additional sales practice
requirements on broker/dealers who sell such securities to persons other than
established customers and accredited investors (generally institutions with
assets in excess of $5,000,000 or individuals with net worth in excess of
$1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their
spouses). For transactions covered by the Rule, the broker/dealer must make a
special suitability determination for the purchase and have received the
purchasers written agreement to the transaction prior to the sale.
Consequently, the Rule may affect the ability of broker/dealers to sell our
securities and also may affect your ability to sell your shares in the secondary
market. Section 15(g) of the Exchange Act also imposes additional sales
practice requirements on broker/dealers who sell penny securities. These rules
require a one-page summary of certain essential items. The items include the
risk of investing in penny stocks in both public offerings and secondary
marketing; terms important in understanding of the function of the penny stock
market, such as bid and offer quotes, a dealers spread and    broker/dealer compensation; the broker/dealer compensation, the
broker/dealers duties to its customers, including the disclosures required by
any other penny stock disclosure rules; the customers rights and remedies in
causes of fraud in penny stock transactions; and, the NASDs toll free telephone
number and the central number of the North American Administrators Association,
for information on the disciplinary history of broker/dealers and their
associated persons. Change of Control. There have been no changes of control.  Item 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
OPERATIONS  We have
not yet enjoyed any revenues. As of June 30, 2007, we have expended $2,017,179
for the acquisition of four yachts and their refit. All of our capital needs
have been supplied by advances from an officer and director or proceeds on a
convertible debenture that have been advanced by an affiliate of that officer
and director. The interest rate on the note is 8%, but due to the related party
nature of the note, the interest expense is forgiven and accounted for as
additional paid in capital. The refit is complete on three yachts and we
estimate that the refit of the remaining yacht will require an additional
$400,000. We understand that this amount is beyond the financial capability of
the current funding source and we intend to carry out a public or private
offering of stock or debt as soon as the Registrant can obtain a listing of its
common stock. However, we have no arrangement or understanding for any funding.
The affiliate is under no legal obligation to continue to supply funding.
 An additional yacht which we refitted was transferred to our officer at
its cost of $154,157, to repay accrued compensation of $55,000 to this person
and to furnish a credit against his future compensation, which is treated as
advances to related party totaling $94,157 as of June 30, 2006.  In the
years ended June 30, 2007 and 2006, we received dividend income from invested
funds of $13 and $43, respectively.  As of
June 30, 2007, we had cash on hand of $1,199. Our cash needs to complete all
projects is estimated to be $400,000. A party affiliated with a shareholder has
indicated that it can loan only a portion of these funds to the Company, but is
under no legal obligation to do so. If we are unable to obtain sufficient
funding, we will not be able to complete projects and realize revenue upon their
sale. In the year ended June 30, 2007, our cash needs were met by related party
loans of $377,702.  Information included in this report includes forward looking
statements, which can be identified by the use of forward-looking terminology
such as may, expect, anticipate, believe, estimate, or continue, or the negative
thereof or other variations thereon or comparable terminology. The statements in
"Risk Factors" and other statements and disclaimers in this report constitute
cautionary statements identifying important factors, including risks and
uncertainties, relating to the forward-looking statements that could cause
actual results to differ materially from those reflected in the forward-looking
statements.  Since we have not yet generated any revenues, we are a development
stage company as that term is defined in paragraphs 8 and 9 of SFAS No. 7.
 Our activities to date have been limited to seeking capital; seeking
supply contracts and development of a business plan.  Our auditors have
included an explanatory paragraph in their report on our financial statements,
relating to the uncertainty of our business as a going concern, due to our lack
of operating history or current revenues, its nature as a start up business,
management's limited experience and limited funds.  We do not believe that
conventional financing, such as bank loans, is available to us due to these
factors.  We have no bank line of credit available to us.  Management
believes that it will be able to raise the required funds for    operations from one or more future offerings, in order to effect
our business plan.  Our
future operating results are subject to many facilities, including:  o
    our success in completing refits and reselling
yachts;  o
    our ability to attract and retain qualified
personnel;  o
    the effects of rising fuel prices and general economic
conditions affecting the market for luxury yachts;  o
    our ability to obtain additional financing; and  o
    other risks which we identify in future filings with the
SEC.  Any or all of our forward looking statements in this annual report
and in any other public statements we make may turn out to be wrong. They can be
affected by inaccurate assumptions we might make or by known or unknown risks
and uncertainties. Consequently, no forward looking statement can be guaranteed.
In addition, we undertake no responsibility to update any forward-looking
statement to reflect events or circumstances which occur after the date of this
report.  Item 7.  FINANCIAL
STATEMENTS AND SUPPLEMENTARY DATA  The
consolidated financial statements of the Company required to be included in Item
7 are set forth in the Financial Statements Index.  Item 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNT­ING AND FINANCIAL DISCLOSURE  On September 14, 2005, the Company terminated its relationship
with Pritchett, Siler & Hardy, P.C. (PSH) the principal accountant
previously engaged to audit the Companys financial statements.  The
Companys board of directors approved the dismissal of PSH. The audit reports of
PSH on the Companys financial statements for the fiscal years ending June 30,
2004 and 2003 did not contain any adverse opinion or disclaimer of opinion, nor
was it qualified or modified as to uncertainty, audit scope, or accounting
principles, except such report was modified to include an explanatory paragraph
for a going concern uncertainty. In connection with the audits of the fiscal
years ending June 30, 2004 and 2003 including the subsequent interim periods
since engagement through September 14, 2005, the date of termination, the
Company had no disagreements with PSH with respect to accounting or auditing
issues of the type discussed in Item 304(a)(iv) of Regulation S-B.  Had
there been any disagreements that were not resolved to their satisfaction, such
disagreements would have caused PSH to make reference in connection with their
opinion to the subject matter of the disagreement. In addition, during that time
there were no reportable events (as defined in Item 304(a)(1)(iv) of Regulation
S-B). During the fiscal year ending June 30, 2004, including the
subsequent interim periods since engagement through September 14, 2005, the date
of PSHs termination, the Company (or anyone on its behalf) did not consult with
any other accounting firm regarding any of the accounting or auditing concerns
stated in Item 304(a)(2) of Regulation S-B. Since there were no disagreements or
reportable events (as defined in Item 304(a)(2) of Regulation S-B), the Company
did not consult any other firm in respect to these matters during the time
periods detailed herein. The Company provided PSH with a copy of a Current Report on Form
8-K dated September 14, 2005. The Company requested that PSH furnish the Company
with a letter to the Securities and Exchange Commission stating whether PSH
agreed with the above statements. A copy of that letter dated September 16,
2005, is filed as an Exhibit to the Form 8-K. In February 2007, the Company engaged De Joya Griffith &
Company, LLC as its independent auditors. On September 8, 2008, Cozumel Corporation (the Company)
terminated its relationship with De Joya Griffith & Company LLC the
principal accountant previously engaged to audit the Companys financial
statements.  The Companys board of directors approved the dismissal of De
Joya Griffith & Company LLC. The audit reports of PSH on  the Companys
financial statements for the fiscal year ending June 30, 2005 and  did not
contain any adverse opinion or disclaimer of opinion, nor was it qualified or
modified as to uncertainty, audit scope, or accounting principles, except such
report was modified to include an explanatory paragraph for a going concern
uncertainty. In connection with the audit of the fiscal year ending June 30,
2005 including the subsequent interim periods since engagement through September
8, 2008, the date of termination, the Company had no disagreements with De Joya
Griffith & Company LLC with respect to accounting or auditing issues of the
type discussed in Item 304(a)(iv) of Regulation S-K, except as set forth in the
following paragraph.  Had there been any disagreements that were not
resolved to their satisfaction, such disagreements would have caused De Joya
Griffith & Company LLC to make reference in connection with their opinion to
the subject matter of the disagreement. In addition, during that time there were
no reportable events (as defined in Item 304(a)(1)(iv) of Regulation S-K),
except as set forth in the following paragraphs. As set
forth in Item 8A of the Annual Report on Form 10-KSB for the fiscal year ended
 June 30, 2005,  respectively,  the  Company  and
 De Joya Griffith & Company LLC identified significant
 deficiencies and material  weaknesses that existed in the design or
operation of the Company's  internal controls over financial
 reporting and such items are  incorporated  herein by
 reference.  The Company has authorized De Joya Griffith & Company
LLC to respond fully to any inquiries  by  The Blackwing Group LLC LLC
 regarding  the  significant deficiencies and material weaknesses
in internal control set forth in the Annual Report on Form 10-KSB.  During the fiscal year ending June 30, 2005, including the
subsequent interim periods since engagement through September 18, 2008, the date
of De Joya Griffith & Company LLC s termination, the Company (or anyone on
its behalf) did not consult with any other accounting firm regarding any of the
accounting or auditing concerns stated in Item 304(a)(2) of Regulation S-K. The
Company did not consult any other firm in respect to these matters during the
time periods detailed herein. The Company provided De Joya Griffith & Company LLC with a
copy of the Form 8-K. The Company requested that De Joya Griffith & Company
LLC furnish the Company with a letter to the Securities and Exchange Commission
stating whether PSH agreed with the above statements. A copy of that letter
dated September 26, 2005 was filed as an Exhibit to the Form 8-K. On September 8, 2008 the Registrant engaged The Blackwing Group,
LLC as its new independent auditor.  Prior to the engagement of The
Blackwing Group, LLC, the Registrant did not consult with The Blackwing Group,
LLC on the application of accounting principles to any specific transaction nor
the type of audit opinion that might be rendered on the Registrant's financial
statements.  Item 8A. CONTROLS AND PROCEDURES.  As of the end of the period covered by this report, we carried out
an evaluation, 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 and
procedures (as defined in Exchange Act Rule 13a-15(e) and 15d-15(e)). 
Based upon that evaluation, our Chief Executive Officer and Chief Financial
Officer concluded that as of the end of the period covered by this Annual Report
on Form 10-KSB our disclosure controls and procedures were not effective to
enable us to accurately record, process, summarize and report certain
information required to be included in the Companys periodic SEC filings within
the required time periods, and to accumulate and communicate to our management,
including the Chief Executive Officer and Chief Financial Officer, to allow
timely decisions regarding required disclosure. Specifically, the Company did
not request nor maintain copies of invoices from all vendors, and management
double booked some expenses advanced by a related party.  There were no changes in our internal control over financial
reporting that occurred during the most recent fiscal quarter that have
materially affected, or are reasonably likely to materially affect, our internal
control over financial reporting.  Item 8B. OTHER INFORMATION.Not Applicable.     PART III  Item 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT.  Directors and Executive
Officers  The
members of the Board of Directors of the Company serve until the next annual
meeting of stockholders, or until their successors have been elected.  The
officers serve at the pleasure of the Board of Directors.  Information as
to the director and executive officer of the Company is as follows.  Jehu
Hand, age 52, has been President, Chief Financial Officer and Secretary of the
Company since its inception.  Mr. Hand has been engaged in corporate and
securities law practice and has been a sole practitioner since May 1994 when
Hand & Hand incorporated as a law corporation in May 1994.  From 1999
to June 2003, Mr. Hand was semi-retired, but began working again in June 2003 as
sole shareholder of Hand & Hand, a professional corporation.
  From January 1992 to December 1992 he was the Vice
President-Corporate Counsel and Secretary of Laser Medical Technology, Inc.,
which designs, manufactures and markets dental lasers and endodontics equipment.
 He was a director of Laser Medical from February 1992 to February 1993.
 From January to October 1992, Mr. Hand was Counsel to the Law Firm of
Lewis, D'Amato, Brisbois & Bisgaard.  From January 1991 to January
1992, he was a shareholder of McKittrick, Jackson, DeMarco & Peckenpaugh, a
law corporation.   From January to December 1990, he was a partner of
Day, Campbell & Hand, and was an associate of its predecessor law firm from
July 1986 to December 1989.  From 1984 to June 1986, Mr. Hand was an
associate attorney with Schwartz, Kelm, Warren & Rubenstein in Columbus,
Ohio.  Jehu Hand received a J.D. from New York University School of Law and
a B.A. from Brigham Young University. He is a registered principal (Series 7, 24
and 63) of Jackson, Kohle & Co., a broker-dealer and member of FINRA, and
also Jackson, Kohle SE, a European broker dealer.   Mr. Hand was a
director and president of Albion Aviation, Inc. from 2000 to March 2003, and is
the sole officer and director of Russian Athena, Inc.  He was the Secretary
of DanaPC.com from 2006 to January 2008 and he currently devotes 10 hours per
week to Cozumel Corporation. In 2006, he was a director of Worldwide
Manufacturing Company USA, Inc.  Audit Committee  We do not
have an audit committee.  The entire Board of Directors serve as the audit
committee.  Because of the small size of the Company and the risk attendant
to a small public company, we are currently unable to attract an audit committee
financial expert to our Board of Directors.  Code
of Ethics  We
have not adopted a code of ethics which applies to the chief executive officer
or principal financial accounting officer, because of our level of operations at
this time.     Item 10. EXECUTIVE COMPENSATION  Mr.
Hand was accrued compensation of $5,000 per month commencing on July 1, 2005. Of
this amount, $55,000 was satisfied in June 2006 by the transfer of inventory to
Mr. Hand at cost. In the month of June 2006 $5,000 was credited from a related
party payable of $99,157 as of the transfer; thus the related party payable was
$34,157 and $94,157 as of June 30, 2008 and 2007, respectively. See Certain
Transactions.  Item 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT  The
following table sets forth information relating to the beneficial ownership of
Company common stock by those persons beneficially holding more than 5% of the
Companys capital stock, by the Company's directors and executive officers, and
by all of the Company's directors and executive officers as a group.  The
address of each person is care of the Company.  Percentage Name of Number of of
Outstanding Stockholder Shares Owned Common Stock  Jehu Hand(1) 800,000 80.0%  Kimberly Peterson 93,850 9.4%  All
officers and directors as a group (1 person) 800,000 80.0%  (1)  Mr. Hand
controls a family limited partnership which is the record holder of these
shares.  Item 12.  CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS  Mr.
Hand from time to time has advanced certain amounts for the Company. These
amounts are unsecured, due on demand and bear no interest. The amount
outstanding at June 30, 2008 and 2007 was $54,534   In June 2006, the
Company transferred a yacht held in inventory to Mr. Hand at its cost of
$154,197.  This amount was credited against Mr. Hands compensation of
$5,000 per month for the months of July 2005 to May 2006, inclusive, and the
remainder of $99,157 was accounted for as a non-interest bearing advance to Mr.
Hand, to be amortized against his monthly compensation. As of June 30, 2007 and
2006, the amount of this advance was $94,157 and $36,532, respectively, which
includes expenses paid by the Company and Mr. Hands behalf in 2007 of $2,375.  An
investment fund controlled by Mr. Hand has loaned funds to the Company under a
Convertible Debenture. The funds bear interest at 8% per annum and are secured
by a lien on the assets of the Company. The amount outstanding at June 30, 2007
and 2006 was $2,132,643 and $1,755,441, respectively. The interest has been
forgiven by the holder and classified as contributed capital. PART IV   Item 13. EXHIBITS AND REPORTS ON FORM 8-K  (a)
Exhibits.  The following exhibits of the Company are included herein.  Exhibit No. Document Description  3.
                Charter
and Bylaws  3.1.
    Articles of Incorporation(1) 3.2
     Bylaws(1)  10.
               Material
Contracts  10.1 Convertible Debenture.
Filed with 2005 10KSB and incorporated by reference herein.  16.
Changes in Accountants  16.1
Letter from Pritchett, Siler and Hardy, P.C. Filed with our Current Report on
Form 8-K dated September 14, 2005.  16.2 Letter from De Joya Griffith & Company LLC. Filed with
our Current Report on Form 8-K dated September 8, 2008.  Exhibit 31. Certification of the Chief Executive and Financial Officer
pursuant to Rule 13a-14 of the Securities and Exchange Act of 1934 as amended,
as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2003. Filed
herewith.  Exhibit 32, Certification of the Chief Executive and Financial Officer
pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2003. Filed herewith.  (1)
     Filed with the Company's original Form 10-SB.  (b) Reports on Form 8-K.  Not
Applicable.  Item
14. Principal Accountant Fees and Services.  Audit
Fees  Our
accountants, The Blackwing Group, LLC, billed us $12,000 for audit fees and
review of quarterly filings for the fiscal years ended June 30, 2006, 2007 and
2008; these fees were paid in fiscal 2009.  Less
than 50% of the hours expended by our auditors on the audit for the years ended
June 30, 2006, 2007 and 2008 were performed by persons other than The Blackwing
Group, LLC permanent full time employees.  There
were no funds paid in audit related fees, tax fees and all other fees to such
firm during the years ended June 30, 2006, 2007 or 2008.  Our
former principal accountants, De Joya Griffith & Company, LLC, billed us
$7,000 for audit fees and review of quarterly filings for the fiscal year ended
June 30, 2005; these fees were paid in fiscal 2008. An additional $8,000 was
billed in 2008 for the 2005 audit.  Less
than 50% of the hours expended by our auditors on the audit for the year ended
June 30, 2005 were performed by persons other than De Joya Griffith &
Company, LLC permanent full time employees.  There
were no funds paid in audit related fees, tax fees and all other fees to such
firm during the year ended June 30, 2005. No fees were paid to auditors in 2006
or 2007.  Audit
Committees pre-approval policies and procedures.  We do not have an
audit committee.  Our engagement of The Blackwing Group, LLC was approved
by the Board of Directors.  No services described in Item 9(e) (2) through
9(e) (4) of Schedule 14A were performed by our auditors.      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 on October
14, 2008.   COZUMEL CORPORATION   By: /s/
Jehu Hand Jehu
Hand President  Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on behalf of
the Registrant and in the capacities on October 14, 2008.    By: /s/ Jehu Hand President, Chief Financial Officer Jehu Hand and Director (chief executive and financial officer and accounting officer and duly authorized officer)                    COZUMEL CORPORATION AND SUBSIDIARY  (A DEVELOPMENT STAGE COMPANY)  AUDITED FINANCIAL STATEMENTS  FOR THE YEARS ENDED JUNE 30, 2007 AND 2006                         THE BLACKWING GROUP, LLC 18921G E VALLEY VIEW PARKWAY #325 INDEPENDENCE, MO 64055    TABLE OF CONTENTS  Page  INDEPENDENT
AUDITORS REPORT F-3  FINANCIAL
STATEMENTS  Balance
sheet F-4  Statement
of Operations F-5  Statement
of Cash Flows F-6  Statement
of Stockholders Equity F-7,
F-8  Notes
to Financial Statements F-9    THE BLACKWING GROUP, LLC 18921G E VALLEY VIEW PARKWAY #325 INDEPENDENCE, MO 64055 816-813-0098  Independent PCAOB Auditors Report   To the Board of Directors and Stockholders of Cozumel Corporation Dana Point, California  We have audited the accompanying balance
sheet of Cozumel Corporation (A Development Stage Company) as of June 30, 2007
and 2006, and the related statements of operations, stockholders equity
(deficit), and cash flows for the period ended June 30, 2007 and 2006.
 These financial statements are the responsibility of the Companys
management. Our responsibility is to express an opinion on these financial
statements based on our audit.  We conducted our audit in accordance with
the standards of the Public Company Accounting Oversight Board (United States).
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. The Company is not required to have, nor were we engaged to
perform, an audit of its internal control over financial reporting.  Our
audit included consideration of internal control over financial reporting as a
basis for designing audit procedures that are appropriate in the circumstances,
but not for the purpose of expressing an opinion on the effectiveness of the
Companys internal control over financial reporting.  Accordingly, we
express no such opinion.  An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.  In our opinion, the financial statements
referred to above present fairly, in all material respects, the financial
position of Cozumel Corporation (A Development Stage Company) as of June 30,
2007 and 2006, and the results of its operations and cash flows for the period
ended June 30, 2007 and 2006 in conformity with U.S. generally accepted
accounting principles.  The accompanying financial statements have
been prepared assuming the Company will continue as a going concern. As
discussed in Note 6 to the financial statements, the Company has suffered
recurring losses from operations, which raise substantial doubt about its
ability to continue as a going concern. Managements plans in regard to these
matters are also described in Note 6. The financial statements do not include
any adjustments that might result from the outcome of this uncertainty.  /s/ The Blackwing Group LLC The Blackwing Group, LLC Issuing Office:  Independence, MO October 12, 2008    COZUMEL
CORPORATION AND SUBSIDIARY (A Development Stage Company) CONSOLIDATED BALANCE SHEETS JUNE 30, 2007 AND 2006   ASSETS 2007 2006 Current Assets Cash and
cash equivalents $ 1,199 $ 24,715 Prepaid
Expenses 8,799 -- Total Current Assets 9,998 24,715  Other Asset Inventory 2,017,648 1,664,841 Other Asset
- Advance to Related Party 36,532 94,157 Total Other Assets 2,054,180 1,758,998  Total Assets 2,064,178 1,783,713  LIABILITIES AND STOCKHOLDERS' EQUITY  Current Liabilities Accounts
payable $ 3,192 $ 543 Advances Due
to  Related Party 54,534 54,534 Note Payable
 Related Party 2,132,644 1,755,441 Total Current Liabilities 2,190,369 1,810,518  Stockholders Equity (Note 4) Preferred stock, par value $.001;
1,000,000 shares authorized;
-0- shares issued and outstanding -- -- Common stock, $.001 par value,
20,000,000 shares authorized;
1,000,000 shares issued and outstanding 1,000 1,000 Additional
paid in capital 309,287 150,075 Retained
Earnings (Accumulated Deficit) (436,477) (177,881) Total Stockholders Equity (126,191) (26,806)  Total Liabilities and
Stockholders Equity $ 2,064,178 $ 1,783,713                 The accompanying notes are an integral part
of these financial statements.    COZUMEL
CORPORATION AND SUBSIDIARY (A Development Stage Company) CONSOLIDATED STATEMENTS OF
OPERATIONS FOR THE PERIODS ENDED JUNE 30, 2007 AND
2006  For the Years ended From Inception June 30, (April 20,
1994) ______________________ Through 2007 2006 June 30, 2007 Total Income $ -- $ -- $ --  Total Cost of Sales -- --  Gross Margin -- -- --  General and Administrative
Expenses 99,398 70,228 188,832  Operating Income (Loss) (99,398) (70,228) (188,832)  Other Income (Expense) Gain on Sale
of Available-for-Sale Securities -- -- 21,882 Dividend
Income 13 43 8,019 Interest
Expense  Related Party (159,212) (98,732) (277,507) Total Other Income
(Expense) (159,199) (98,689) (247,606)  Net Income (Loss) $ (258,597) $ (168,917) $ (436,438)  Net Income (Loss) Before
Provision for Income Taxes (258,597) (168,917) (436,438)  Provision
for Income Taxes (see Note 3) -- --39  Net Income (Loss) After
Provision for Income Taxes $ (258,597) $ (168,917) $ (436,477)  Other Comprehensive Income (Loss) Gain on Sale
of Available-for-Sale Securities -- Less:
Reclassification Adjustment -- -- -- Total Other Comprehensive
Income (Loss) $ -- $ -- $ --   Per Share Information:  Net Income (Loss) per share 
1,000,000 shares issued $ (0.26) $ (0.17) $ (0.44)  Basic weighted average number common stock
shares outstanding 1,000,000 1,000,000 1,000,000   Diluted weighted average number common stock
shares outstanding 1,000,000 1,000,000 1,000,000     The accompanying notes are an integral part
of these financial statements.    COZUMEL
CORPORATION AND SUBSIDIARY CONSOLIDATED STATEMENTS OF CASH
FLOWS FOR THE PERIODS ENDED JUNE 30, 2007 AND
2006  For the Years ended From Inception June 30, (April 20,
1994) ______________________ Through 2007 2006 June 30, 2007 CASH FLOWS FROM OPERATING ACTIVITIES Net Income (Loss) $ (258,597) $ (168,917) $ (436,477)  Adjustments to reconcile net income to net cash
provided by operating activities Depreciation -- -- -- (Increase) decrease in: Inventory (352,807) (1,158,979) (2,017,648) Prepaid
Expenses (8,799) -- (8,800) Related
Party Advances 57,625 (94,157) (36,532) Increase (decrease) in: Accounts
payable 2,649 (11,398) 3,192 Net Cash
Provided (Used) By Operating Activities (559,930) (1,433,451) (2,496,265)  CASH FLOWS FROM INVESTING ACTIVITIES  Gain (Loss)
on Sale of Available-for-Sale Securities -- -- (21,882) Forgiveness
of Interest  Related Party 159,212 98,731 307,508 Purchase of
Available-for-Sale Securities (202,139) Proceeds
from Sale of Available-for-Sale Securities -- -- 225,785 Net Cash
(Used) By Investing Activities 159,212 98,731 309,272  CASH FLOWS FROM FINANCING ACTIVITIES  Cash
Deficit -- -- -- Advances
from Related Party -- 60,011 112,574 Repayment of
Advances From Related Party -- (55,000) (58,040) Proceeds
from Note Payable  Related Party 377,202 1,330,311 2,132,643 Capital
Contributions -- -- 1,015 Net Cash
(Used) By Financing Activities 377,202 1,335,322 2,188,192  NET NCREASE
(DECREASE) IN CASH (23,516) 602 1,199  CASH AT BEGINNING OF PERIOD 24,714 24,112 --  CASH AT END OF PERIOD $ 1,199 $ 24,714 1,199  Supplemental Disclosures of Cash Flow Information: Cash Paid During the Period for: Interest -- -- -- Income
Taxes -- -- --  Supplemental Schedule of Non-cash Investing and Financing
Activities Forgiveness
of Debt  Related Party 159,212 98,732 307,508 Asset
Contribution in lieu of Inventory Purchase -- -- 30,000 The accompanying notes are an integral part
of these financial statements.


COZUMEL
CORPORATION AND SUBSIDIARY CONSOLIDATED
STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT) FROM INCEPTION
(APRIL 20, 1994) THROUGH JUNE 30, 2007  Total Capital Stock
Issued Number of Number of Additional Comprehensive Stockholders Preferred Common Paid In Income Deficit Equity Shares Amount Shares Value Capital (Loss) Accumulated (Deficit) -- Balance April
20, 1994 -- -- -- -- -- --  --  April 20, 1994 Common stock issued for cash
at .001 1,000,000 0.001 15 -- -- 1,015  Net Loss for the period from April 20,
1994 To June 30,
1994 -- -- -- -- (42) (42)  Balance as
of June 30, 1994 1,000,000 0.001 15 -- (42) 973  Net Loss for the
period from June 30, 1995 (338) (338)  Balance as
of June 30, 1995 1,000,000 0.001 15 -- (380) 635  Net Loss for the
period from June 30, 1996 (320) (320)  Balance as
of June 30, 1996 1,000,000 0.001 15 -- (700) 315  Net Loss for the
period from June 30, 1997 (314) (314)  Balance as
of June 30, 1997 1,000,000 0.001 15 -- (1,014) 1  Net Loss for the
period from June 30, 1998 (312) (312)  Balance as
of June 30, 1998 1,000,000 0.001 15 -- (1,326) (311)  Net Loss for the
period from June 30, 1999 (790) (790)  Balance as
of June 30, 1999 1,000,000 0.001 15 -- (2,116) (1,101)  The accompanying notes are an integral part
of these financial statements.  COZUMEL
CORPORATION AND SUBSIDIARY CONSOLIDATED
STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT) FROM INCEPTION
(APRIL 20, 1994) THROUGH JUNE 30, 2007  Total Capital Stock
Issued Number of Number of Additional Comprehensive Stockholders Preferred Common Paid In Income Deficit Equity Shares Amount Shares Value Capital (Loss) Accumulated (Deficit)  Net Loss for the period from June 30, 2000
         (1,134)  (1,134)  Balance as
of June 30, 2000 1,000,000 0.001 15 -- (3,250) (2,235)  Net Loss for the
period from June 30, 2001 (947) (947)  Balance as
of June 30, 2001 1,000,000 0.001 15 -- (4,197) (3,182)  Net Loss for the
period from June 30, 2002 (1,519) (1,519)  Balance as
of June 30, 2002 1,000,000 0.001 15 -- (5,716) (4,701)  Net Loss for the
period from June 30, 2003 (154) (154)  Balance as
of June 30, 2003 1,000,000 0.001 15 -- (5,870) (4,855)  Unrealized
holding gain -- -- -- 2,980 -- 2,980  Accrued interest expense forgiven by
related Party accounted for as contribution to capital -- -- 1,414 -- -- 1,414  Net Loss for the
period from June 30, 2004 (764) (764)  Balance as
of June 30, 2004 1,000,000 0.001 1,429 2,980 (6,634) (1,225)      The accompanying notes are an integral part
of these financial statements.





COZUMEL
CORPORATION AND SUBSIDIARY CONSOLIDATED
STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT) FROM INCEPTION
(APRIL 20, 1994) THROUGH JUNE 30, 2007  Total Capital Stock
Issued Number of Number of Additional Comprehensive Stockholders Preferred Common Paid In Income Deficit Equity Shares Amount Shares Value Capital (Loss) Accumulated (Deficit)  Contribution to capital
    --
 -                                                                                                                                                       
  -
 49,915                                  
--      --                    49,915  Realization of
holding loss -- -- -- (2,980) -- (2,980)  Net Loss for the
period from June 30, 2005 (2,330) (2,330)  Balance as
of June 30, 2005 1,000,000 0.001 51,344 -- (8,964) 43,380  Contribution to
capital -- -- 98,732 -- -- 98,732  Net Loss for the
period from June 30, 2006 (168,917) (168,917)  Balance as
of June 30, 2006 1,000,000 0.001 150,076 -- (177,881) (26,806)  Contribution to
capital -- -- 159,212 -- -- 159,212  Net Loss for the
period from June 30, 2007 (258,597) (258,597)  Balance as
of June 30, 2007 1,000,000 0.001 309,287 -- (436,478) (126,191)           The accompanying notes
are an integral part of these financial statements.





COZUMEL CORPORATION AND
SUBSIDIARY (A Development Stage
Company) NOTES TO FINANCIAL
STATEMENTS FOR THE PERIODS ENDING
JUNE 30, 2007 AND 2006  A summary of significant
accounting policies of Cozumel Corporation (A Development Stage Company) (the
Company) is presented to assist in understanding the Companys financial
statements.  The accounting policies presented in these footnotes conform
to accounting principles generally accepted in the United States of America and
have been consistently applied in the preparation of the accompanying financial
statements.  These financial statements and notes are representations of
the Companys management who are responsible for their integrity and
objectivity.  The Company has not realized revenues from its planned
principal business purpose and is considered to be in its development state in
accordance with SFAS 7, Accounting and Reporting by Development Stage
Companys.  NOTE 1 - DESCRIPTION OF THE BUSINESS,
HISTORY AND SUMMARY OF SIGNIFICANT
POLICIES  Organization - COZUMEL CORPORATION
(the Company) was organized under the laws of the State of Delaware on April
20, 1994 for the purpose of seeking out business opportunities, including
acquisitions.  The Company formed a Florida subsidiary, Cozumel Yacht
Brokers, Inc. in January 2005 and has entered the business of buying, selling,
remodeling and brokering the sale of yachts. The financial statements present
the consolidated financial position, results of operations and cash flows for
the consolidated entity. The Company has, at the present time, not paid any
dividends and any dividends that may be paid in the future will depend upon the
financial requirements of the Company and other relevant factors.  The Company is currently a development
stage company reporting under the provisions of Statement of Financial
Accounting Standard ("FASB") No. 7, "Accounting and Reporting for Development
Stage Companys."  Cash and Cash Equivalents - For
purposes of the statement of cash flows, the Company considers all highly liquid
financial instruments purchased with a maturity of three months or less to be
cash equivalents.  Inventory -Inventories are stated
at the lower of cost or market, cost being determined on the first-in, first-out
method. At June 30, 2007, inventory includes one Burger 74 motor yacht in
process of refit and three smaller yachts whose refits have been completed.  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.
 The calculation of diluted net loss per share gives effect to common stock
equivalents; however, potential common shares are excluded if their effect is
antidilutive.  For the years ended June 30, 2007 and 2006, no options and
warrants were included in the computation of diluted earnings per share because
their effect would be antidilutive.  Fair Value -The carrying amounts
reflected in the consolidated balance sheet for cash, accounts payable and
accrued expenses approximate the respective fair values due to the short
maturities of these items.  Reclassifications  Certain
amounts in prior year financial statements have been reclassified for
comparative purposes to conform to presentation in the current year financial
statements.  Accounting Estimates - The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities, the disclosures of
contingent assets and liabilities at the date of the financial statements, and
the reported amount of revenues and expenses during the reported period.
 Actual results could differ from those estimated.  COZUMEL CORPORATION AND
SUBSIDIARY (A Development Stage
Company) NOTES TO FINANCIAL
STATEMENTS FOR THE PERIODS ENDING
JUNE 30, 2007 AND 2006  NOTE 1 - DESCRIPTION OF THE BUSINESS,
HISTORY AND SUMMARY OF SIGNIFICANT
POLICIES (cont)  New Accounting Pronouncements In December 2004, the FASB issued SFAS No.
153, Exchanges of Nonmonetary Assets, an amendment of APB Opinion No. 29
(SFAS No. 153).  SFAS No. 153 is based on the principle that exchanges of
nonmonetary assets should be measured based on the fair value of the assets
exchanged.  APB Opinion No. 29, Accounting for
Nonmonetary Transactions, provided an exception to its basic measurement
principle (fair value) for exchanges of similar productive assets.  Under
APB Opinion No. 29, an exchange of a productive asset for a similar productive
asset was based on the recorded amount of the asset relinquished.  SFAS No.
153 eliminates this exception and replaces it with an exception of exchanges of
nonmonetary assets that do not have commercial substance. SFAS No. 153 was
applicable for nonmonetary asset exchanges occurring in fiscal periods beginning
after June 15, 2005. The implementation of SFAS 2005 is not expected to have any
material impact on the financial statements.  In May 2005, the FASB issued SFAS No. 154,
Accounting Changes and Error Corrections, a replacement of APB No. 20 and FASB
Statement No. 3 (SFAS No. 154).  SFAS No. 154 requires retrospective
application to prior periods financial statements of a voluntary change in
accounting principles unless it is impracticable.  APB Opinion No. 20
Accounting Changes previously required that most voluntary changes in
accounting principles be recognized by including in net income of the period of
the change the cumulative effect of changing to the new accounting principle.
 This Statement is effective for the Company as of January 1, 2006. The
Company does not believe that the adoption of SFAS No. 154 will have a material
impact on its financial statements.  In February 2006, the FASB issued Statement
of Financial Accounting Standards No. 155, Accounting for Certain Hybrid
Financial Instruments ("SFAS No. 155"), which amends Statement of Financial
Accounting Standards No. 133, Accounting for Derivative Instruments and Hedging
Activities ("SFAS No. 133") and Statement of Financial Accounting Standards No.
140, Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities ("SFAS No. 140").  SFAS No. 155 permits fair value measurement
for any hybrid financial instrument that contains an embedded derivative that
otherwise would require bifurcation, establishes a requirement to evaluate
interests in securitized financial assets to identify interests that are
freestanding derivatives or hybrid financial instruments containing embedded
derivatives. The Company will apply SFAS 155 for all financial instruments
acquired, issued, or subject to a re-measurement, occurring after our first
fiscal year that begins after September 15, 2006. Since the Company has not and
does not intend to acquire any hybrid financial instrument, the application of
SFAS 155 will have no impact on the Company.  In March 2006, the FASB issued SFAS No.
156, Accounting for Servicing of Financial Assets (SFAS 156), which amends
SFAS No. 140.  SFAS No. 156 may be adopted as early as January 1, 2006 by
calendar year-end entities, provided that no interim financial statements have
been issued.  Those not choosing to early adopt are required to apply the
provisions as of the beginning of the first fiscal year that begins after
September 15, 2006 (e.g., January 1, 2007 for calendar year-end entities).
 The intention of the new statement is to simplify accounting for
separately recognized servicing assets and liabilities, such as those common
with mortgage securitization activities, as well as, to simplify efforts to
obtain hedge-like accounting.  SFAS No. 156 permits a servicer using
derivative financial instruments to report both the derivative financial
instrument and related servicing asset or liability by using a consistent
measurement attribute or fair value.  The Company does not service any
financial assets or liabilities and the adoption of SFAS No. 156 had no impact
on the Companys consolidated financial position, results of operations or cash
flows. COZUMEL CORPORATION AND
SUBSIDIARY (A Development Stage
Company) NOTES TO FINANCIAL
STATEMENTS FOR THE PERIODS ENDING
JUNE 30, 2007 AND 2006  NOTE 1 - DESCRIPTION OF THE BUSINESS,
HISTORY AND SUMMARY OF SIGNIFICANT
POLICIES (cont)  New Accounting Pronouncements
(continued) In December 2004, the FASB issued SFAS No.
123(R), Share-Based Payment, which establishes standards for transactions in
which an entity exchanges its equity instruments for goods or services. This
standard replaces SFAS No. 123 and supersedes APB Opinion No. 25, Accounting
for Stock-based compensation. This standard requires a public entity to measure
the cost of employee services received in exchange for an award of equity
instruments based on the grant-date fair value of the award. This eliminates the
exception to account for such awards using the intrinsic method previously
allowable under APB Opinion No. 25. SFAS No. 123(R) will be effective for
interim or annual reporting periods beginning on or after June 15, 2005.
 The Company does not believe that the application of SFAS 123(R) will have
any material impact on the Company.  In June 2006, the Financial Accounting
Standards Board (FASB) issued FASB Interpretation No.  48, "Accounting for
Uncertainty in Income Taxes - an interpretation of FASB Statement No. 109" (FIN
48), which clarifies the accounting for uncertainty in tax positions. This
Interpretation requires that we recognize in our financial statements the
benefit of a tax position if that position is more likely than not of being
sustained on audit, based on the technical merits of the position. The
provisions of FIN 48 become effective as of the beginning of our 2008 fiscal
year, with the cumulative effect of the change in accounting principle recorded
as an adjustment to opening   retained earnings. We are currently
evaluating the impact that FIN 48 will have on our financial statements.  In September 2006, the FASB issued
Statement No. 157, "Fair Value Measurements" (FAS 157), which defines fair
value, establishes a framework for measuring fair value, and expands disclosures
about fair value measurements. The provisions of FAS 157 become effective as of
the beginning of our 2009 fiscal year. We are currently evaluating the impact
that FAS 157 will have on our financial statements.  In September 2006, the FASB issued
Statement No. 158, "Employer's Accounting for Defined Benefit Pension and Other
Postretirement Plans - an amendment of FASB Statements No. 87, 88, 106, and
132(R)" (FAS 158). FAS 158 requires that employers recognize the funded status
of their defined benefit pension and other postretirement plans on the balance
sheet and recognize as a component of other comprehensive income, net of tax,
the plan-related gains or losses and prior service costs or credits that arise
during the period but are not recognized as components of net periodic benefit
cost. We do not believe this will impact our financial statements.  In September 2006, the Securities and
Exchange Commission issued Staff Accounting Bulletin No. 108, "Considering the
Effects of Prior Year Misstatements when Quantifying Misstatements in Current
Year Financial Statements" (SAB 108), which addresses how to quantify the effect
of financial statement errors. The provisions of SAB 108 become effective as of
the end of our 2007 fiscal year. We do not expect the adoption of SAB 108 to
have a significant impact on our financial statements.  In February 2007, the FASB issued Statement
No. 159, "The Fair Value Option for Financial Assets and Financial Liabilities,
including an amendment of FASB Statement No. 115" (FAS159). FAS 159 permits
companies to choose to measure many financial instruments and certain other
items at fair value that are not currently required to be measured at fair value
and establishes presentation and disclosure requirements designed to facilitate
comparisons between companies that choose different measurement attributes for
similar types of assets and liabilities. The provisions of FAS 159 become
effective as of the beginning of our 2009 fiscal year. We are currently
evaluating the impact that FAS 159 will have on our financial statements.  COZUMEL CORPORATION AND SUBSIDIARY (A Development Stage
Company) NOTES TO FINANCIAL
STATEMENTS FOR THE PERIODS ENDING
JUNE 30, 2007 AND 2006  NOTE 1 - DESCRIPTION OF THE BUSINESS,
HISTORY AND SUMMARY OF SIGNIFICANT
POLICIES (cont)  New Accounting Pronouncements
(continued) In December 2007, the FASB issued
SFAS 160, Noncontrolling Interests in Consolidated Financial Statements,
an Amendment of ARB 51 (SFAS 160).  SFAS 160 establishes new
accounting and reporting standards for noncontrolling interests in a subsidiary
and for the deconsolidation of a subsidiary.  SFAS 160 will require
entities to classify noncontrolling interests as a component of stockholders
equity and will require subsequent changes in ownership interests in a
subsidiary to be accounted for as an equity transaction.  Additionally,
SFAS 160 will require entities to recognize a gain or loss upon the loss of
control of a subsidiary and to re-measure any ownership interest retained at
fair value on that date.  This statement also requires expandeddisclosures that clearly identify and
distinguish between the interests of the parent and the interests of the
noncontrolling owners.  SFAS 160 is effective on a prospective
basis for fiscal years, and interim periods within those fiscal years, beginning
on or after December 15, 2008, except for the presentation and disclosure
requirements, which are required to be applied retrospectively.  Early
adoption is not permitted.  In
March 2008, the FASB issued SFAS No. 161, Disclosures about Derivative
Instruments and Hedging Activities  an amendment of FASB Statement No. 133,
(SFAS 161) as amended and interpreted, which requires enhanced disclosures
about an entitys derivative and hedging activities and thereby improves the
transparency of financial reporting. Disclosing the fair values of derivative
instruments and their gains and losses in a tabular format provides a more
complete picture of the location in an entitys financial statements of both the
derivative positions existing at period end and the effect of using derivatives
during the reporting period. Entities are required to provide enhanced
disclosures about (a) how and why an entity uses derivative instruments, (b) how
derivative instruments and related hedged items are accounted for under
Statement 133 and its related interpretations, and (c) how derivative
instruments and related hedged items affect an entitys financial position,
financial performance, and cash flows. SFAS No. 161 is effective for financial
statements issued for fiscal years and interim periods beginning after November
15, 2008. Early adoption is permitted.  In May 2008, the Financial Accounting
Standards Board issued Statement of Financial Accounting Standards No. 162, The
Hierarchy of Generally Accepted Accounting Principles (SFAS No. 162).
 This Statement identifies the sources of accounting principles and the
framework for selecting the principles to be used in the preparation of
financial statements of nongovernmental entities that are presented in
conformity with generally accepted accounting principles (GAAP) in the United
States (the GAAP hierarchy).  The sources of accounting principles that are
generally accepted are categorized in descending order of authority as
follows:  a. FASB Statements of
Financial Accounting Standards and Interpretations, FASB Statement 133
Implementation Issues, FASB Staff Positions, and American Institute of Certified
Public Accountants (AICPA) Accounting Research Bulletins and Accounting
Principles Board Opinions that are not superseded by actions of the FASB.  b. FASB Technical Bulletins
and, if cleared by the FASB, AICPA Industry Audit and Accounting Guides and
Statements of Position.  c. AICPA Accounting
Standards Executive Committee Practice Bulletins that have been cleared by the
FASB, consensus positions of the FASB Emerging Issues Task Force  (EITF),
and the Topics discussed in Appendix D of EITF Abstracts (EITF
D-Topics)     COZUMEL CORPORATION AND SUBSIDIARY (A Development Stage
Company) NOTES TO FINANCIAL
STATEMENTS FOR THE PERIODS ENDING
JUNE 30, 2007 AND 2006  NOTE 1 - DESCRIPTION OF THE BUSINESS,
HISTORY AND SUMMARY OF SIGNIFICANT
POLICIES (cont)  New Accounting Pronouncements
(continued)  (b) Implementation guides
(Q&As) published by the FASB staff, AICPA Accounting Interpretations, AICPA
Industry Audit and Accounting Guides and Statements of Position not cleared by
the FASB, and practices that are widely recognized and prevalent either
generally or in the industry.  In May 2008, the Financial Accounting
Standards Board (FASB) issued SFAS No. 163, Accounting for financial
Guarantee Insurance Contracts  An interpretation of FASB Statement No. 60.
 SFAS 163 requires that an insurance Company recognize a claim liability
prior to an event of default when there is evidence that credit deterioration
has occurred in an insurance financial obligation.  It also clarifies how
Statement 60 applies to financial guarantee insurance contracts, including the
recognition and measurement to be used to account for premium revenue and claim
liabilities, and requires expanded disclosures about financial guarantee
insurance contracts.  It is effective for financial statements issued for
fiscal years beginning after December 15, 2008, except for some disclosures
about the insurance Companys risk-management activities.  SFAS 163
requires that disclosures about the risk-management activities of the insurance
Company be effective for the first period beginning after issuance.  Except
for those disclosures, earlier application is not permitted.  The adoption
of this statement is not expected to have a material effect on the Companys
future reported financial position or results of operations.  NOTE 2 - NOTE PAYABLE RELATED
PARTY  In May 2004, the Company issued a $150,000
note payable to an entity related to a shareholder of the Company The conversion
price for the Debentures in effect on any Conversion Date shall be the lesser of
(a)  $0.01 (the Fixed Conversion Price) and (b) one hundred percent
(100%) of the average of the three (3) lowest closing bid prices per share of
the Common Stock during the forty (40) Trading Days immediately preceding the
Conversion Date (the Floating Conversion Price); provided, however, that the
aggregate maximum number of shares of Common Stock that the First Debenture and
Second Debenture may be converted into shall be Three Million (3,000,000) shares
(the Maximum Conversion); and further provided, however, that upon the Maximum
Conversion, the Company may, at its option (a) increase the Maximum Conversion
or redeem the unconverted amount of the Debentures in whole or in part at
one hundred twenty five percent (125%) of the unconverted amount of such
Debentures being redeemed plus accrued interest thereon.  For purposes of determining the closing bid
price on any day, reference shall be to the closing bid price for a share of
Common Stock on such date on the OTCBB (or such other exchange, market, or other
system that the Common Stock is then traded on), as reported on Bloomberg, L.P.
(or similar organization or agency succeeding to its functions of reporting
prices).  The note is due on demand and accrues
interest at 8% per annum.  During the year ended June 30, 2007 and 2006,
respectively, interest expense was $159,212 and $98,732.  During the year
ended June 30, 2007 and 2006, respectively, the related party forgave accrued
interest of $159,212 and $98,731.  Due to the related party nature of the
forgiveness, the Company accounted for it as a capital contribution. The Company
has determined the convertible debenture to not have a beneficial conversion
feature, therefore, no beneficial conversion feature has been recorded as of
June 30, 2007.    COZUMEL CORPORATION AND SUBSIDIARY (A Development Stage
Company) NOTES TO FINANCIAL
STATEMENTS FOR THE PERIODS ENDING
JUNE 30, 2007AND 2006  NOTE 3 - INCOME TAXES  At June 30, 2007 and 2006, the Company had
a federal operating loss carryforward of approximately $437,466 and $177,881,
respectively, which expires in varying amounts between 2007 and 2006.  Components of net deferred tax assets,
including a valuation allowance, are as follows at June 30:  2007

2006Deferred tax assets:Net operating loss carryforward

$
            153,220

$
         62,121Total deferred
tax assets

(153,220)

(62,121)Less: Valuation Allowance

--

--Net Deferred Tax
Assets

$
                  --

$
                   --   The valuation allowance for deferred tax
assets as of June 30, 2007 and 2006 was $153,220 and $62,121, respectively.
 In assessing the recovery of
the deferred tax assets, management considers whether it is more likely than not
that some portion or all of the deferred tax assets will not be realized.
 The ultimate realization of deferred tax assets is dependent upon the
generation of future taxable income in the periods in which those temporary
differences become deductible.  Management considers the scheduled
reversals of future deferred tax assets, projected future taxable income, and
tax planning strategies in making this assessment.  As a result, management
determined it was more likely than not the deferred tax assets would not be
realized as of June 30, 2007 and 2006 and, accordingly, recorded a full
valuation allowance.  Reconciliation between the statutory rate
and the effective tax rate is as follows at June 30:  2007

2006Federal statutory tax rate

(35.0)%

(35.0)%State taxes, net of federal benefit

(8.7)%

(8.7)%Change in valuation allowance

43.7
%

43.7
%Effective tax rate

0.0
%

0.0
%  NOTE 4 - STOCKHOLDERS
EQUITY (DEFICIT)  Preferred Stock- The Company has
authorized 1,000,000 shares of preferred stock, $.001 par value, with such
rights, preferences and designations and to be issued in such series as
determined by the Board of Directors. No shares are issued and outstanding at
June 30, 2007.  Common Stock- The Company has
authorized 20,000,000 shares of common stock with a par value of $.001.  On
April 20, 1994, in connection with its organization, the Company issued
1,000,000 shares of its previously authorized, but unissued common stock.
 The shares were issued for cash of $1,015 (or $.001 per share).    COZUMEL CORPORATION AND SUBSIDIARY (A Development Stage
Company) NOTES TO FINANCIAL
STATEMENTS FOR THE PERIODS ENDING
JUNE 30, 2007 AND 2006  NOTE 4 - STOCKHOLDERS
EQUITY (DEFICIT) (continued)  1994 Stock Option Plan -On April
20, 1994, the Company adopted the 1994 Stock Option Plan.  The plan expired
in 2004.  NOTE 5 - RELATED PARTY
TRANSACTIONS  Advances -During the years ended
June 30, 2007 and 2006, a former officer/shareholder of the Company directly
paid expenses totaling $0 and $60,011 on behalf of the Company.  No
interest is being accrued on the advances.  In the years ended June 30,
2007 and 2006, the Company directly paid $2,375 and $0 on behalf of this
officer.  These amounts were added to the related party advances
account.  Note Payable -The Company has a
note payable to an entity related to a shareholder of the Company (see note 3 
Note payable Related Party).  Management Compensation -For the
year ended June 30, 2007 and 2006, the Company did not pay any compensation to
any officer or director of the Company.  Office Space - The Company
has not had a need to rent office space. An officer/shareholder of the Company
is allowing the Company to use his offices as a mailing address, as needed, at
no expense to the Company.  NOTE 6 - 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.  However, the Company has incurred losses
since its inception and has not yet been successful in establishing profitable
operations.  The Company has an accumulated deficit of $436,477, and a
working capital deficit of $2,180,370 as of June 30, 2007. These factors raise
substantial doubt about the ability of the Company to continue as a going
concern.  In this regard, management is proposing to raise any necessary
additional funds not provided by operations through loans or through additional
sales of its common stock.  There is no assurance that the Company will
be successful in raising this additional capital or achieving profitable
operations.  The financial statements do not include any adjustments that
might result from the outcome of these uncertainties.