U.S.
Securities and Exchange Commission
 Washington,
D.C. 20549
  
 FORM
10-Q
 
  (Mark One)
                          xQuarterly Report Pursuant to Section 13 or 15(d) of the Securities
      Exchange Act of 1934
                          
                          For
      the quarterly period ended June 30, 2009
                          
                          oTransition Report Pursuant to Section 13 or 15(d) of the Securities
      Exchange Act
                          For the
      transition period from N/A to N/A
  
 
 Commission
File No. 000-52775
  
 Royal
Equine Alliance Corporation
 (Name of
small business issuer as specified in its charter)
  Nevada
                  20-4076559State
      of Incorporation
                  IRS
      Employer Identification No.
 269
South Beverly Drive, Suite 1222
 Beverly
Hills, California 90212
 (Address
of principal executive offices)
 
 (310)
882-6830
 (Issuer’s
telephone number)
 Securities
registered under Section 12(b) of the Exchange Act:
 None
 Securities
registered under Section 12(g) of the Exchange Act:
 Common
Stock, $0.0001 par value per share
 (Title
of Class)
 
 Indicate
by check mark whether the Registrant (1) has filed all reports required 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  ̈
 
 Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files). Yes [_] No [
]
 
 Indicate
by check mark whether the Registrant is a large accelerated filer, an
accelerated filer, or a non–accelerated filer. See definition of “accelerated
filer and large accelerated filer” in Rule 12b–2 of the Exchange Act. (Check
one):
 
 Large
accelerated filer   ̈                    Accelerated
filer   ̈                    Non–Accelerated
filer   ̈ Small Business
Issuer  x
 
 Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b–2 of the Exchange Act).  Yes  x    No   ̈
 
 Indicate
the number of shares outstanding of each of the issuer’s classes of common
stock, as of the latest practicable date.
 
 Class
                
                Outstanding
      at  August 14, 2009Common
      stock, $0.0001 par value
                
                4,900,000
 
 1
 
 ROYAL
EQUINE ALLIANCE CORPORATION
 INDEX
TO FORM 10-QSB FILING
 FOR
THE THREE AND SIX MONTHS ENDED JUNE 30, 2009
 
 TABLE
OF CONTENTS
 
 PART
I
 FINANCIAL
INFORMATION
 
 PAGEPART
      I - FINANCIAL INFORMATIONItem 1.
                
                Financial
      Statements (unaudited)Balance
      Sheets
                
                3Statements
      of Operations
                
                4Statements
      of Cash Flows
                
                5Notes
      to Financial Statements
                
                6Item 2.
                
                Management
      Discussion & Analysis of Financial Condition and Results of
      Operations
                
                11Item 3.
                
                Quantitative
      and Qualitative Disclosures About Market Risk
                
                13Item 4.
                
                Controls
      and Procedures
                
                13PART
      II - OTHER INFORMATIONItem 1.
                
                Legal
      Proceedings
                
                14Item 1A.
                
                Risk
      Factors
                
                14Item 2.
                
                Unregistered
      Sales of Equity Securities and Use of Proceeds
                
                14Item 3.
                
                Defaults
      Upon Senior Securities
                
                15Item 4.
                
                Submission
      of Matters to a Vote of Security Holders
                
                15Item 5.
                
                Other
      information
                
                15Item 6.
                
                Exhibits
                
                15
  
 CERTIFICATIONS
 
 Exhibit
31 – Management certification............................................................... 16-19
 
 Exhibit 32 – Sarbanes-Oxley
Act...................................................................... 20-21
 
 
 2
 ROYAL
EQUINE ALLIANCE CORPORATION
 (A
Development Stage Company)
 BALANCE
SHEETS
 
 June
      30,
                        
                        
                        December
      31,2009
                        
                        
                        2008(unaudited)
                        
                        
                        (audited)ASSETSCURRENT
      ASSETSCash
                        
                        $
                        -
                        
                        
                        $
                        -Total
      Current Assets
                        
                        
                        -
                        
                        
                        
                        -TOTAL
      ASSETS
                        
                        $
                        -
                        
                        
                        $
                        -LIABILITIES AND STOCKHOLDERS' EQUITY
      (DEFICIT)CURRENT
      LIABILITIESAccounts
      payable and accrued expenses
                        
                        $
                        11
      557
                        
                        
                        $
                        6
      157Loan
      payable - related Party
                        
                        
                        7
      199
                        
                        
                        
                        5
      299Total
      Current Liabilities
                        
                        
                        18
      756
                        
                        
                        
                        11
      456STOCKHOLDERS'
      EQUITY (DEFICIT)Preferred
      stock; $0.001 par value, 5,000,000 sharesauthorized;
      no shares issued or outstanding
                        
                        
                        -
                        
                        
                        
                        -Common
      stock; $0.001 par value, 70,000,000 sharesauthorized;
      4,900,000 shares issued or outstandingas
      of June 30, 2009 and December 31, 2008
                        
                        
                        4
      900
                        
                        
                        
                        4
      900Additional
      paid-in capital
                        
                        
                        149
      055
                        
                        
                        
                        149
      055Accumulated
      deficit during development stage
                        
                        
                        (172
      711
                        )
                        
                        
                        (165
      411
                        )Total
      Stockholders' Equity (Deficit)
                        
                        
                        (18
      756
                        )
                        
                        
                        (11
      456
                        )TOTAL
      LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
                        
                        $
                        -
                        
                        
                        
                        -
 
 The
accompanying notes are an integral part of these statements
 
 3
 ROYAL
EQUINE ALLIANCE CORPORATION
 (A
Development Stage Company)
 STATEMENTS OFOPERATIONS
 (Unaudited)
 
 From
      InceptionThree
                    
                    
                    Three
                    
                    
                    Six
                    
                    
                    Six
                    
                    
                    January
      10,Months
      Ended
                    
                    
                    Months
      Ended
                    
                    
                    Months
      Ended
                    
                    
                    Months
      Ended
                    
                    
                    2006,
      ThroughJune
      30,
                    
                    
                    June
      30
                    
                    
                    June
      30,
                    
                    
                    June
      30,
                    
                    
                    June
      30,2009
                    
                    
                    2008
                    
                    
                    2009
                    
                    
                    2008
                    
                    
                    2009REVENUES
                    
                    $
                    -
                    
                    
                    $
                    -
                    
                    
                    $
                    -
                    
                    
                    $
                    -
                    
                    
                    $
                    4
      000COST
      OF SALES
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -GROSS
      PROFIT
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    4
      000EXPENSESGeneral
      and administrative
                    
                    
                    2
      400
                    
                    
                    
                    -
                    
                    
                    
                    7
      300
                    
                    
                    
                    26
      639
                    
                    
                    
                    158
      731Total
      Expenses
                    
                    
                    2
      400
                    
                    
                    
                    -
                    
                    
                    
                    7
      300
                    
                    
                    
                    26
      639
                    
                    
                    
                    158
      731OPERATING
      LOSS
                    
                    
                    (2
      400
                    )
                    
                    
                    -
                    
                    
                    
                    (7
      300
                    )
                    
                    
                    (26
      639
                    )
                    
                    
                    (154
      731
                    )OTHER
      INCOME (EXPENSE)Other
      loss
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (17
      980
                    )Total
      other income (expense)
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (17
      980
                    )INCOME
      TAX EXPENSE
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -NET
      INCOME (LOSS)
                    
                    $
                    (2
      400
                    )
                    
                    $
                    -
                    
                    
                    $
                    (7
      300
                    )
                    
                    $
                    (26
      639
                    )
                    
                    $
                    (172
      711
                    )BASIC
      LOSS  PER SHAREPER
      SHARE
                    
                    $
                    -0.00
                    
                    
                    $
                    0.00
                    
                    
                    $
                    -0.00
                    
                    
                    $
                    -0.01WEIGHTED
      AVERAGE NUMBERNUMBER
      OF SHARES OUTSTANDING
                    
                    
                    4
      900 000
                    
                    
                    
                    4
      900 000
                    
                    
                    
                    4
      900 000
                    
                    
                    
                    4
      900 000
 
 The
accompanying notes are an integral part of these statements
 4
 ROYAL
EQUINE ALLIANCE CORPORATION
 (A
Development Stage Company)
 STATEMENTSOF CASH
FLOWS
 (Unaudited)
 
 From
      InceptionFor
      the Six
                      
                      
                      For
      the Six
                      
                      
                      January
      10,Months
      Ended
                      
                      
                      Months
      Ended
                      
                      
                      2006,
      ThroughJune
      30,
                      
                      
                      June
      30,
                      
                      
                      June
      30,2009
                      
                      
                      2008
                      
                      
                      2009CASH
      FLOWS FROM OPERATING ACTIVITIESNet
      income (loss)
                      
                      $
                      (7
      300
                      )
                      
                      $
                      (26
      639
                      )
                      
                      $
                      (172
      711
                      )Adjustments
      to reconcile net loss tonet
      cash used by operating activities:Changes
      in operating assets and liabilitiesIncrease
      (decrease) in accounts payable
                      
                      
                      5
      400
                      
                      
                      1
      968
                      
                      
                      
                      11
      557Net
      Cash Used by Operating Activities
                      
                      
                      (1
      900
                      )
                      
                      
                      (24
      671
                      )
                      
                      
                      (161
      154
                      )CASH
      FLOWS FROM INVESTING ACTIVITIES
                      
                      
                      -
                      
                      
                      
                      
                      
                      
                      
                      -CASH
      FLOWS FROM FINANCING ACTIVITIESIncrease
      in due to related party
                      
                      1
      900
                      
                      
                      
                      -
                      
                      
                      
                      7
      199Common
      stock issued for cash
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      153
      955Net
      Cash Provided by Financing Activities
                      
                      1
      900
                      
                      
                      
                      -
                      
                      
                      
                      161
      154NET
      DECREASE IN CASH
                      
                      
                      -
                      
                      
                      
                      (24
      671
                      )
                      
                      
                      -CASH
      AT BEGINNING OF PERIOD
                      
                      
                      -
                      
                      
                      
                      24
      671
                      
                      
                      
                      -CASH
      AT END OF PERIOD
                      
                      $
                      -
                      
                      
                      $
                      -
                      
                      
                      $
                      -SUPPLIMENTAL
      DISCLOSURES OFCASH
      FLOW INFORMATIONCASH
      PAID FOR:Interest
                      
                      $
                      -
                      
                      
                      $
                      -
                      
                      
                      $
                      -Income
      Taxes
                      
                      $
                      -
                      
                      
                      $
                      -
                      
                      
                      $
                      -
 
 The
accompanying notes are an integral part of these statements
 5
 ROYAL
EQUINE ALLIANCE CORPORATION
 (A
Development Stage Company)
 NOTES TO FINANCIAL
STATEMENTS (Unaudited)
 June 30,
2009
 
 NOTE 1.GENERAL ORGANIZATION AND
BUSINESS
 
 Royal
Equine Alliance Corporation (“Company”) was incorporated in the State of Nevada
on January 10, 2006. The Company is in its development stage and with a
principal business objective of eventually acquiring horse properties and in the
short term building an income stream from horse racing operations including race
horse boarding, training and racing facilities, as well as revenue generation
through the direct and indirect ownership of racing horses.
 
 NOTE
2. BASIS OF PRESENTATION
 
 Interim
Financial Statements
  The
accompanying interim unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and Article
8 of Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In our opinion, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. Operating results for the three and six months period ended June 30,
2009 and 2008 are not necessarily indicative of the results that may be expected
for the year ending December 31, 2009. For further information, refer to the
financial statements and footnotes thereto included in our Form 10-K Report for
the fiscal year ended December 31, 2008.
 
 NOTE
3.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
 The
relevant accounting policies and procedures are listed below.
 
 Accounting
Basis
 
 The
statements were prepared following generally accepted accounting principles of
the United States of America consistently applied.  The Company uses a
December 31 year end.
 
 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 disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenue and expenses during
the reporting period. Actual results could differ from those
estimates.
 
 Cash
and Cash Equivalents
 
 Cash and
cash equivalents include all short-term liquid investments that are readily
convertible to know amounts of cash and have original maturities of twelve
months or less. As of June 30, 2009 there were no cash equivalents.
  6
 Revenue
Recognition
 
 The
company recognized when products are fully delivered or services have been
provided and collection is reasonably assured.
 
 Earnings
per Share
 
 The basic
earnings (loss) per share are calculated by dividing the Company’s net income
available to common shareholders by the weighted average number of common shares
during the year. The diluted earnings (loss) per share is calculated by dividing
the Company’s net income (loss) available to common shareholders by the diluted
weighted average number of shares outstanding during the year. The diluted
weighted average number of shares outstanding is the basic weighted number of
shares adjusted for any potentially dilutive debt or equity.
 
 Dividends
 
 The
Company has not yet adopted any policy regarding payment of dividends. No
dividends have been paid during the periods shown.
 
 Stock
Based Compensation
 
 The
Company accounts for its stock based compensation based upon provisions in SFAS
No. 123, Accounting for
Stock-Based Compensation.  In this statement stock based
compensation is divided into two general categories, based upon who the stock
receiver is, namely: employees/directors and
non-employees/directors.  The employees/directors category is further
divided based upon the particular stock issuance plan, namely compensatory and
non-compensatory.  The employee/directors non-compensatory securities
are recorded at the sales price when the stock is sold.  The
compensatory stock is calculated and recorded at the securities’ fair value at
the time the stock is given.  SFAS 123 also provides that stock
compensation paid to non-employees be recorded with a value which is based upon
the fair value of the services rendered or the value of the stock given,
whichever is more reliable.  The Company has selected to utilize the
fair value of the stock issued as the measure of the value of services
obtained.
 
 Income
Taxes
 
 The
provision for income taxes is the total of the current taxes payable and the net
of the change in the deferred income taxes. Provision is made for the deferred
income taxes where differences exist between the period in which transactions
affect current taxable income and the period in which they enter into the
determination of net income in the financial statements.
 
 Accounting Standards Codification
and the Hierarchy of Generally Accepted Accounting
Principles
 
 In June
2009, the Financial Accounting Standards Board issued Statement “FASB” issued
Statement No. 168, “The FASB Accounting Standards Codification and the Hierarchy
of Generally Accepted Accounting Principles” (“SFAS No. 168”).  SFAS
No. 168 will become the single source of authoritative nongovernmental U.S.
generally accepted accounting principles (“GAAP”), superseding existing FASB,
American Institute of Certified Public Accountants (“AICPA”), Emerging Issues
Task Force (“EITF”), and related accounting literature.  SFAS No. 168
reorganizes the thousands of GAAP pronouncements into roughly 90 accounting
topics and displays them using a consistent structure.  Also included
is relevant Securities and Exchange Commission guidance organized using the same
topical structure in separate sections.  SFAS No. 168 will be
effective for financial statements issued for reporting periods that end after
September 15, 2009.  This statement will have an impact on the
Company’s financial statements since all future references to authoritative
accounting literature will be references in accordance with SFAS No. 168.
The Company will adopt the use of the Codification for the quarter ending
September 30, 2009.  The Company is currently evaluating the effect on
its financial statement disclosures since all future references to authoritative
accounting literature will be references in accordance with the
Codification.
 
 7
  Subsequent
Events
 
 In May
2009, the FASB issued SFAS No. 165, “Subsequent Events”.(“SFAS No. 165”)
This Statement establishes general standards of accounting for and disclosures
of events that occur after the balance sheet date but before financial
statements are issued or are available to be issued.  It requires the
disclosure of the date through which an entity has evaluated subsequent events
and the basis for that date and is effective for interim and annual periods
ending after June 15, 2009.  We are currently assessing the impact of
the adoption of SFAS 165, if any, on our financial position, results of
operations or cash flows.
 
 Development
Stage Enterprise
 
 The
Company is a development stage enterprise, as defined in Financial Accounting
Standards Board No. 7.  The Company’s planned principal operations
have not fully commenced.
 
 Management
plans to seek funding from its shareholders and other qualified investors to
pursue its business plan.
 
 NOTE
4. GOING CONCERN
 
 The
Company’s financial statements are prepared using generally accepted accounting
principles applicable to a going concern which contemplates the realization of
assets and liquidation of liabilities in the normal course of business. From
inception date to through June 30, 2009, the Company has had no revenues and has
generated losses from operations $172,711.
 
 In order
to continue as a going concern and achieve a profitable level of operations, the
Company will need, among other things, additional capital resources and to
develop a consistent source of revenues.  Management’s plans include
of investing in and developing all types of businesses related to the equine
industry.
 
 The
ability of the Company to continue as a going concern is dependent upon its
ability to successfully accomplish the plan described in the preceding paragraph
and eventually attain profitable operations. The accompanying financial
statements do not include any adjustments that might be necessary if the Company
is unable to continue as a going concern.
 
 NOTE
5.  PROVISION FOR INCOME TAXES
 
 Income
taxes are provided in accordance with Statement of Financial Accounting
Standards No. 109 (SFAS 109), Accounting for Income Taxes.  A deferred
tax asset or liability is recorded for all temporary differences between
financial and tax reporting and net operating loss
carryforwards.  Deferred tax expense (benefit) results from the net
change during the year of deferred tax assets and liabilities.
 
 Deferred
tax assets are reduced by a valuation allowance when, in the opinion of
management, it is more likely than not that some portion or all of the deferred
tax assets will be not realized.  Deferred tax assets and liabilities
are adjusted for the effects of changes in tax laws and rates on the date of
enactment.
 
 8
 No
provision was made for Federal income tax.  The provision for income
taxes consists of the state minimum tax imposed on corporations.
 
 NOTE
6.  RELATED PARTY TRANSACTION
 
 As of
June 30, 2009, the Company has concluded a Personal Loan Agreement with CEO. The
loan is in the amount of $7,199 and is for administrative purposes. The amount
due to the related party is unsecured and non interest-bearing.
 
 NOTE
7.  STOCKHOLDERS EQUITY TRANSACTIONS
 
 The
Company is authorized 5,000,000 preferred stock shares with a $0.001 par value.
As of June 30, 2009, no shares were issued and outstanding.
 
 The
Company is authorized 70,000,000 common shares with a $0.001 par value. As of
June 30, 2009, 4,900,000 shares were issued and outstanding.
 
 On
December 31, 2006, the Company issued 3,800,000 shares of common stock for
$98,955 cash. The Company later issued 1,100,000 shares of common stock for
$55,000 cash or $0.05 per share.
 
 NOTE  8.
THE EFFECT OF RECENTLY ISSUED ACCOUNTING  STANDARDS
 
 Below is
a listing of the most recent Statement of Financial
Accounting Standards (SFAS) and their effect on the Company.
  In May
2008, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 163,
“Accounting for Financial Guarantee Insurance Contracts-and interpretation of
FASB Statement No. 60”.  SFAS No. 163 clarifies how Statement 60
applies to financial guarantee insurance contracts, including the recognition
and measurement of premium revenue and claims liabilities. This statement also
requires expanded disclosures about financial guarantee insurance contracts.
SFAS No. 163 is effective for fiscal years beginning on or after December 15,
2008, and interim periods within those years. SFAS No. 163 has no effect on the
Company’s financial position, statements of operations, or cash flows at this
time.
 
 In June
2009, the Financial Accounting Standards Board issued Statement “FASB” issued
Statement No. 168, “The FASB Accounting Standards Codification and the Hierarchy
of Generally Accepted Accounting Principles” (“SFAS No. 168”).  SFAS
No. 168 will become the single source of authoritative nongovernmental U.S.
generally accepted accounting principles (“GAAP”), superseding existing FASB,
American Institute of Certified Public Accountants (“AICPA”), Emerging Issues
Task Force (“EITF”), and related accounting literature.  SFAS No. 168
reorganizes the thousands of GAAP pronouncements into roughly 90 accounting
topics and displays them using a consistent structure.  Also included
is relevant Securities and Exchange Commission guidance organized using the same
topical structure in separate sections.  SFAS No. 168 will be
effective for financial statements issued for reporting periods that end after
September 15, 2009.  This statement will have an impact on the
Company’s financial statements since all future references to authoritative
accounting literature will be references in accordance with SFAS No. 168.
The Company will adopt the use of the Codification for the quarter ending
September 30, 2009.  The Company is currently evaluating the effect on
its financial statement disclosures since all future references to authoritative
accounting literature will be references in accordance with the
Codification.
 
 In May
2009, the FASB issued SFAS No. 165, “Subsequent Events”.(“SFAS No. 165”)
This Statement establishes general standards of accounting for and disclosures
of events that occur after the balance sheet date but before financial
statements are issued or are available to be issued.  It requires the
disclosure of the date through which an entity has evaluated subsequent events
and the basis for that date and is effective for interim and annual periods
ending after June 15, 2009.  We are currently assessing the impact of
the adoption of SFAS 165, if any, on our financial position, results of
operations or cash flows.
 
 9
 In March
2008, the Financial Accounting Standards Board, or FASB, issued SFAS No. 161,
Disclosures about Derivative Instruments and Hedging Activities—an amendment of
FASB Statement No. 133.  This standard requires companies 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. This Statement is effective for
financial statements issued for fiscal years and interim periods beginning after
November 15, 2008, with early application encouraged. SFAS No. 161 has no effect
on the Company’s financial position, statements of operations, or cash flows at
this time
 
 In
December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in
Consolidated Financial Statements—an amendment of ARB No. 51.  This
statement amends ARB 51 to establish accounting and reporting standards for the
noncontrolling interest in a subsidiary and for the deconsolidation of a
subsidiary. It clarifies that a noncontrolling interest in a subsidiary is an
ownership interest in the consolidated entity that should be reported as equity
in the consolidated financial statements. Before this statement was issued,
limited guidance existed for reporting noncontrolling interests. As a result,
considerable diversity in practice existed. So-called minority interests were
reported in the consolidated statement of financial position as liabilities or
in the mezzanine section between liabilities and equity. This statement improves
comparability by eliminating that diversity. This statement is effective for
fiscal years, and interim periods within those fiscal years, beginning on or
after December 15, 2008 (that is, January 1, 2009, for entities with calendar
year-ends). Earlier adoption is prohibited. The effective date of this statement
is the same as that of the related Statement 141 (revised 2007). It is not
believed that this will have an impact on the Company’s financial position,
results of operations or cash flows. In this
Quarterly Report on Form 10-Q, “Company,” “our company,” “us,” and “our” refer
to Royal Equine Alliance Corp., Inc. unless the context requires
otherwise.
 
 10
 ITEM
2 - MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
 
 Management’s
Discussion and Analysis contains various “forward looking statements” within the
meaning of Section 21E of the Securities Exchange Act of 1934, as amended,
regarding future events or the future financial performance of the Company that
involve risks and uncertainties. Certain statements included in this Form
10-QSB, including, without limitation, statements related to anticipated cash
flow sources and uses, and words including but not limited to “anticipates”,
“believes”, “plans”, “expects”, “future” and similar statements or expressions,
identify forward looking statements. Any forward-looking statements herein are
subject to certain risks and uncertainties in the Company’s business. The
Company’s actual results could differ materially from those anticipated in these
forward-looking statements as a result of certain factors, including those set
forth therein.
 
 Forward-looking
statements involve risks, uncertainties and other factors, which may cause our
actual results, performance or achievements to be materially different from
those expressed or implied by such forward-looking statements. Factors and risks
that could affect our results and achievements and cause them to materially
differ from those contained in the forward-looking statements include those
identified in the section titled “Risk Factors” in the Company’s Annual Report
on Form 10-KSB for the year ended December 31, 2007, as well as other factors
that we are currently unable to identify or quantify, but that may exist in the
future.
  In
addition, the foregoing factors may affect generally our business, results of
operations and financial position. Forward-looking statements speak only as of
the date the statement was made. We do not undertake and specifically decline
any obligation to update any forward-looking statements.
 
 Plan
of Operations
 
 We were
incorporated in the State of Nevada on January 10, 2006. Our company is a
startup and has not yet realized any revenues. Our efforts, to date, have
focused primarily on the development and implementation of our business plan. No
development-related expenses have been or will be paid our
affiliates.
  During
the period from inception through June 30, 2009, we generated no revenues
of and incurred a net loss of $172,711. The cumulative net loss was attributable
solely to general and administrative expenses related to the costs of start-up
operations.
  Our
officer and director believe that our cash on hand as of June 30, 2009 in
the amount of zero may not be sufficient to maintain our current minimal level
of operations for current calendar year and management may need to explore other
alternative sources of revenue.
 
 If we do
not generate sufficient revenues to meet our expenses over the next 12 months,
or if we need additional capital to acquire real estate properties, we may need
to raise additional capital. We intend to seek access to capital through the
issues of debt securities or through issuing additional capital stock in
exchange for cash, in order to continue as a going concern. There are no formal
or informal agreements to attain such financing. We can not assure you that any
financing can be obtained or, if obtained, that it will be on reasonable terms.
Without realization of additional capital, it would be unlikely for us to
continue as a going concern.
  Since our
incorporation, we have raised a total of $153,955 through private sales of our
common equity.
 
 11
 RESULTS
OF OPERATIONS
 
 Results of Operations for
the three and six months ended June 30, 2009
 
 We had
zero revenues for the three and six months ended June 30, 2009.
 
 Operating Expenses for the
three and six months ended June 30, 2009.
 
 We had
operating expenses of $2,400 and $7,300 for the three and six months ended June
30, 2009, respectively. These expenses consisted of general operating expenses
and professional fee incurred in connection with the day to day operation of our
business and preparation and filing our periodic reports. Our operating expenses
from inception through June 30, 2009 was $158,731.
 
 On March
3, 2008, Michael Schlosser, the holder of 3,500,000 shares of common stock of
the Company, representing 71.43% of the Company’s issued and outstanding shares
of Common Stock, sold his shares of Common Stock in a private transaction to
Demitro Marianovich.
 
 Our management believes that establishing our
brand name is imperative to our ability to continue as a going concern.
Establishing a personal local presence is critical to reaching a broad consumer
base, including web based contacts. We intend to develop a comprehensive website
to offer information about our company and provide contact information. We will
update the website as time and financial assets allow. The website will be
primarily for contact information and some general information about the
company. It will serve as our secondary method of generating service
contracts.
  Off-Balance
Sheet Arrangements
 
 We do not
have any off-balance sheet arrangements.
 
 We do not
expect to incur any significant research and development costs.
 
 We
currently do not own any significant plant or equipment that we would seek to
sell in the near future.
 
 We have
not paid for expenses on behalf of our director. Additionally, we believe that
this fact shall not materially change.
 
 We do not
intend to engage in a merger with, or effect an acquisition of, another company
in the foreseeable future.
 
 Additional
Information
 
 We file
reports and other materials with the Securities and Exchange
Commission.  These documents may be inspected and copied at the
Securities and Exchange Commission, Judiciary Plaza, 100 F Street, N.E., Room
1580, Washington, D.C. 20549.  You can obtain information on the
operation of the Public Reference Room by calling the Commission at
1-800-SEC-0330.  You can also get copies of documents that the Company
files with the Commission through the Commission’s Internet site at www.sec.gov.
 
 12
  ITEM 3.
              QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
      RISK
 
 We do not
hold any derivative instruments and do not engage in any hedging
activities.
 
 ITEM
4.     CONTROLS AND PROCEDURES
  a)
Evaluation of Disclosure Controls and Procedures
 
 Our Chief
Executive Officer and Chief Financial Officer evaluated the effectiveness of our
disclosure controls and procedures as of the end of the period covered by this
report. Based on that evaluation, Chief Executive Officer and Chief Financial
Officer concluded that our disclosure controls and procedures as of the end of
the period covered by this report were effective such that the information
required to be disclosed by us in reports filed under the Securities Exchange
Act of 1934 is (i) recorded, processed, summarized and reported within the time
periods specified in the SEC's rules and forms and (ii) accumulated and
communicated to the Chief Executive Officer and Chief Financial Officer, as
appropriate to allow timely decisions regarding disclosure. A controls system
cannot provide absolute assurance, however, that the objectives of the controls
system are met, and no evaluation of controls can provide absolute assurance
that all control issues and instances of fraud, if any, within a company have
been detected.
 
 Our Chief
Executive Officer and Chief Financial Officer are responsible for establishing
and maintaining adequate internal control over financial reporting (as defined
in Rule 13a-15(f) under the Exchange Act). Our internal control over financial
reporting is a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with accounting principles generally
accepted in the United States.
 
 Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements. Therefore, even those systems determined to be
effective can provide only reasonable assurance of achieving their control
objectives. Furthermore, smaller reporting companies face additional
limitations. Smaller reporting companies employ fewer individuals and find it
difficult to properly segregate duties. Often, one or two individuals control
every aspect of the Company's operation and are in a position to override any
system of internal control. Additionally, smaller reporting companies tend to
utilize general accounting software packages that lack a rigorous set of
software controls.
 
 Our Chief
Executive Officer and Chief Financial Officer evaluated the effectiveness of the
Company's internal control over financial reporting as of June 30, 2009. In
making this assessment, our Chief Executive Officer and Chief Financial Officer
used the criteria set forth by the Committee of Sponsoring Organizations of the
Treadway Commission (COSO) in Internal Control -- Integrated Framework. Based on
this evaluation, our Chief Executive Officer and Chief Financial Officer
concluded that, as of June 30, 2009, our internal control over financial
reporting was effective.
 
 b)
Changes in Internal Control over Financial Reporting.
 
 During
the Quarter ended June 30, 2009, there was no change in our internal control
over financial reporting (as such term is defined in Rule 13a-15(f) under the
Exchange Act) that has materially affected, or is reasonably likely to
materially affect, our internal control over financial reporting.
  13
 PART
II – OTHER INFORMATION
 
 ITEM
1. LEGAL PROCEEDINGS
 
 We are
currently not involved in any litigation that we believe could have a material
adverse effect on our financial condition or results of operations. There is no
action, suit, proceeding, inquiry or investigation before or by any court,
public board, government agency, self-regulatory organization or body pending
or, to the knowledge of the executive officers of our company or any of our
subsidiaries, threatened against or affecting our company, our common stock, any
of our subsidiaries or of our companies or our subsidiaries' officers or
directors in their capacities as such, in which an adverse decision could have a
material adverse effect.
 
 ITEM 1A
-Risk Factors
 
 We have
updated the risk factors previously disclosed in our registration statement on
Form SB-2, filed December 21, 2006 and subsequently amended (the “Form SB-2”)
and in our Annual Report on Form 10–K for the year ended December 31, 2008,
which was filed with the Securities and Exchange Commission on
March 25, 2009 (the “Fiscal 2008 10–K”). We believe there are no changes
that constitute material changes from the risk factors previously disclosed in
the Fiscal 2008 10–K and the Form SB-2 except as disclosed or repeated
below.
 
 Our
Common Stock Is Subject To Penny Stock Regulation
 
 Our
shares are subject to the provisions of Section 15(g) and Rule 15g-9 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), commonly
referred to as the "penny stock" rule. Section 15(g) sets forth certain
requirements for transactions in penny stocks and Rule 15g-9(d)(1) incorporates
the definition of penny stock as that used in Rule 3a51-1 of the Exchange Act.
The Commission generally defines penny stock to be any equity security that has
a market price less than $5.00 per share, subject to certain exceptions. Rule 3a51-1
provides that any equity security is considered to be penny stock unless that
security is: registered and traded on a national securities exchange meeting
specified criteria set by the Commission; authorized for quotation on the NASDAQ
Stock Market; issued by a registered investment company; excluded from the
definition on the basis of price (at least $5.00 per share) or the registrant's
net tangible assets; or exempted from the definition by the Commission. Since
our shares are deemed to be "penny stock", trading in the shares will be subject
to additional sales practice requirements on broker/dealers who sell penny stock
to persons other than established customers and accredited
investors.
 
 The
Liquidity Of Our Common Stock Is Seriously Limited And There Is A Limited Market
For Our Common Stock
 
 Our stock
is currently being traded on the NASDAQ Over-The-Counter Bulletin Board, and the
liquidity of our common stock is limited. The Bulletin Board is a limited market
and subject to substantial restrictions and limitations in comparison to the
NASDAQ system. Any broker/dealer that makes a market in our stock or other
person that buys or sells our stock could have a significant influence over its
price at any given time.
 
 ITEM
2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
SECURITIES
 
 There
were no changes in securities and small business issuer purchase of equity
securities during the period ended June 30, 2009.
 
 
 14
 ITEM
3.  DEFAULTS UPON SENIOR SECURITIES
 
 There
were no defaults upon senior securities during the period ended June 30,
2009.
 
 ITEM
4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
 
 There
were no matters submitted to the vote of securities holders during the period
ended June 30, 2009.
 
 ITEM
5.  OTHER INFORMATION
  There is
no information with respect to which information is not otherwise called for by
this form.
  ITEM
6.  EXHIBITS
  31.1
              Certification
      of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley
      Act31.2
              Certification
      of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley
      Act.32.1
              Certification
      of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley
      Act.32.2
              Certification
      of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley
      Act.
 
 
 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.
  Registrant
                
                Date:
      August 12, 2009
              
              Royal
      Equine Alliance Corporation
                
                By: /s/Demitro
      MarianovichDemitro
      MarianovichChief
      Executive Officer (Principle Executive Officer, Principle Financial
      Officer)
  15