U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549  FORM 10-KSB  xANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]  For the fiscal year ended December 31, 2006  o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]  Commission file number: 000-28581  Quantum Companies, Inc. (Name of Small Business Issuer in Its Charter)  Nevada88-0448810 (State or Other Jurisdiction of Incorporation(I.R.S. Employer Identification No.) or Organization)
  3200 Airport Avenue, Suite 20, Santa Monica, California  90405 (Address of principal executive office)                                  (Zip Code)  (310) 636-9225 (Issuers Telephone Number, Including Area Code)  Securities registered under Section 12(g) of the Exchange Act:  Name of Exchange Title of Each ClassOn Which Registered Common Stock (par value $0.001)  Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  YesxNo o  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-KSB or any amendment to this Form 10-KSB.  o  State issuer's revenues for its most recent fiscal year:  $0.  The aggregate market value of the voting stock held by non-affiliates (12,308,500) shares of Common Stock) was $0.00 as of December 31, 2006.  The stock price for computation purposes was $0.00 since the Companys common stock is not traded on any market. This value is not intended to be a representation as to the value or worth of the Registrant's shares of Common Stock.  The number of shares of non-affiliates   of the Registrant has been calculated by subtracting shares held by persons affiliated with the Registrant from outstanding shares. The number of shares outstanding of the Registrant's Common Stock as of December 31, 2006 was: 12,408,500.




APPLICABLE ONLY TO CORPORATE ISSUERS



State the number of shares outstanding of each of the issuers classes of common equity, as of the latest practicable date.  Number of Common Shares outstanding as of April 10, 2007:  12,408,500.




DOCUMENTS INCORPORATED BY REFERENCE



If the following documents are incorporated by reference, briefly describe them and identify the part of the Form 10-KSB (e.g., Part I, Part II, etc.) into which the document is incorporated: (1) any annual report to security holders; (2) any proxy or information statement; and (3) any prospectus filed pursuant to Rule 424(b) or (c) of the Securities Act of 1933 (ASecurities Act@).  The listed documents should be clearly described for identification purposes (e.g., annual report to security holders for fiscal year ended December 31, 2006).



Transitional Small Business Disclosure Format (check one):




Yes o Nox































2



QUANTUM COMPANIES, INC.

INDEX TO ANNUAL REPORT

ON FORM 10-KSB




PagePART IItem 1. DESCRIPTION OF BUSINESS
        
        5Item 2. DESCRIPTION OF PROPERTY
        
        8Item 3. LEGAL PROCEEDINGS
        
        8Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITYHOLDERS
        
        
        8PART IIItem 5. MARKET FOR COMMON EQUITY AND RELATEDSTOCKHOLDER MATTERS
        
        8Item 6.MANAGEMENT'S DISCUSSION AND ANALYSIS OFFINANCIAL CONDITION AND RESULTS OF OPERATIONS
        
        9Item 7.FINANCIAL STATEMENTS
        
        12Item 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTSON ACCOUNTING AND FINANCIAL DISCLOSURE
        
        12Item 8A.  CONTROLS AND PROCEDURES
        
        12Item 8B.  OTHER INFORMATION
        
        13Item 9. DIRECTORS, EXECUTIVE OFFICERS AND CONTROLPERSON; COMPLIANCE WITH SECTION 16(a) OF THEEXCHANGE ACT
        
        14Item 10.EXECUTIVE COMPENSATION
        
        15Item 11.SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERSAND MANAGEMENT
        
        16Item 12.CERTAIN RELATIONSHIPS ANDRELATED TRANSACTIONS
        
        17Item 13.EXHIBITS AND REPORTS ON FORM 8-K
        
        17Item14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
        
        18INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
        
        F-1
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
        
        F-2





3



PART I



THIS FORM 10-KSB CONTAINS "FORWARD-LOOKING STATEMENTS". FORWARD-LOOKING STATEMENTS ARE STATEMENTS CONCERNING PLANS, OBJECTIVES, GOALS, STRATEGIES, EXPECTATIONS, INTENTIONS, PROJECTIONS, DEVELOPMENTS, FUTURE EVENTS, PERFORMANCE OR PRODUCTS, UNDERLYING (EXPRESSED OR IMPLIED) ASUMPTIONS AND OTHER STATEMENTS THAT ARE OTHER THAN HISTORICAL FACTS.  IN SOME CASES FORWARD-LOOKING STATEMENTS CAN BE IDENTIFIED BY THE USE OF FORWARD-LOOKING WORDS SUCH AS "BELIEVES," "EXPECTS," "MAY," "WILL," "SHOULD," OR "ANTICIPATES," OR THE NEGATIVE OF THESE WORDS OR OTHER VARIATIONS OF THESE WORDS OR COMPARABLE WORDS, OR BY DISCUSSIONS OF PLANS OR STRATEGY THAT INVOLVE RISKS AND UNCERTAINTIES.  MANAGEMENT WISHES TO CAUTION THE READER THAT THESE FORWARD-LOOKING STATEMENTS, INCLUDING,  BUT NOT LIMITED TO, STATEMENTS REGARDING THE COMPANYS MERGER PLANS, GOALS, COMPETITIVE TRENDS AND OTHER MATTERS THAT ARE NOT HISTORICAL FACTS ARE
ONLY PREDICTIONS.  NO ASSURANCES CAN BE GIVEN THAT SUCH PREDICTIONS WILL PROVE CORRECT OR THAT THE ANTICIPATED FUTURE RESULTS WILL BE ACHIEVED.  ACTUAL EVENTS OR RESULTS MAY DIFFER MATERIALLY EITHER BECAUSE ONE OR MORE PREDICTIONS PROVE TO BE ERRONEOUS OR AS A RESULT OF OTHER RISKS FACING THE COMPANY. FORWARD-LOOKING STATEMENTS SHOULD BE READ IN LIGHT OF THE CAUTIONARY STATEMENTS AND IMPORTANT FACTORS DESCRIBED IN THIS FORM 10-KSB, INCLUDING, BUT NOT LIMITED TO "THE FACTORS THAT MAY AFFECT FUTURE RESULTS" SHOWN AS ITEM 1A AND IN MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. THE RISKS INCLUDE, BUT ARE NOT LIMITED TO, THE RISKS ASSOCIATED WITH AN EARLY-STAGE COMPANY THAT HAS ONLY A LIMITED HISTORY OF OPERATIONS, THE COMPARATIVELY LIMITED FINANCIAL RESOURCES OF THE COMPANY, THE INTENSE COMPETITION THE COMPANY FACES FROM OTHER ESTABLISHED COMPETITORS, REGULATORY CHANGES THAT MAY LIMIT THE ABILITY OF THE COMPANY TO ACQUIRE A SUITABLE COMPANY OR
EXISTING BUSINESS OR ADVERSELY IMPACT THE TERMS OF ANY ACQUISITION TRANSACTION.  ANY ONE OR MORE OF THESE OR OTHER RISKS COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THE FUTURE RESULTS



4



INDICATED, EXPRESSED, OR IMPLIED IN SUCH FORWARD-LOOKING STATEMENTS.  WE UNDERTAKE NO OBLIGATION TO UPDATE OR REVISE ANY FORWARD-LOOKING STATEMENT TO REFLECT EVENTS, CIRCUMSTANCES, OR NEW INFORMATION AFTER THE DATE OF THIS FORM 10-KSB OR TO REFLECT THE OCCURRENCE OF UNANTICIPATED OR OTHER SUBSEQUENT EVENTS.



Item 1.  Description of Business.



As used herein, the terms we, our, us, and the Company refer to Quantum Companies, Inc., a Nevada corporation.



Company Structure



Quantum Companies, Inc., a Nevada corporation (the Company) was incorporated in the state of Nevada on October 15, 1999.  Initially the Company was formed to acquire real estate.  On January 20, 2001, we entered into an agreement to purchase a seven unit apartment building from Triad Industries, Inc., a publicly-traded company.  Later, this real estate was sold on August 13, 2002.  We currently have no material assets or operations and our common stock is not currently traded in any market.



Our management is actively undertaking efforts to locate a private company which will serve as a suitable merger candidate. The exact form and nature of any transaction with a private has not yet been determined.  In our current condition, the Securities and Exchange Commission has defined and designated us as a "blind pool" and "blank check" company with all of the unfortunate aspects of that moniker.



Currently, we seek to acquire a business or an entity that has an existing business.  We have not selected any company for acquisition or merger and we do not currently intend to limit potential acquisition candidates to any particular field or industry, but we may limit acquisition or merger candidates to a particular field or industry.



We will not likely restrict our search to any specific business, industry or geographical location, and we may participate in a business venture of virtually any kind or nature.  The discussion of the proposed business under this caption is purposefully general and is not meant to be restrictive of our virtually unlimited discretion to search for and enter into potential business opportunities.



We may obtain funds in one or more private placements to finance the operation of any acquired business. Persons purchasing securities in these placements and other shareholders will likely not have the opportunity to participate in the decision relating to any acquisition. Our proposed business is sometimes referred to as a "blind pool" because any investors will entrust their investment monies to the Company's management before they have a chance to analyze any ultimate use to which their money may be put.  Consequently, our potential success is heavily dependent on our management, which will



5




have virtually unlimited discretion in searching for and entering into a business opportunity. There can be no assurance that we will be able to raise any funds in one or more private placements.



Management anticipates that it will only participate in one potential business venture which may or may not involve the residential housing industry.  This lack of diversification should be considered a substantial risk in investing in the Company because it will not permit the Company to offset potential losses from one venture against gains from another.



We may seek a business opportunity with a firm which only recently commenced operations, or a developing company in need of additional funds for expansion into new products or markets, or seeking to develop a new product or service, or an established business which may be experiencing financial or operating difficulties and is in the need for additional capital which is perceived to be easier to raise by a public company.  In some instances, a business opportunity may involve the acquisition or merger with a corporation which does not need substantial additional cash but which desires to establish a public trading market for its common stock.  We may purchase assets and establish wholly owned subsidiaries in various businesses or purchase existing businesses as subsidiaries.  Currently, our common stock is not trading in any public market and, as a result, the ability of the Company to
acquire another business or company may be limited due to the lack of any trading market for the Companys common stock. For these reasons, we may not attract a suitable merger candidate.



We anticipate that the selection of a business opportunity in which to participate will be complex and extremely risky.  Because of general economic conditions, rapid technological advances being made in some industries, and shortages of available capital, management believes that there are numerous firms seeking the benefits of a publicly traded corporation.  Such perceived benefits of a publicly traded corporation may include facilitating or improving the terms on which additional equity financing may be sought, providing liquidity for the principals of a business, creating a means for providing incentive stock options or similar benefits to key employees, providing liquidity (subject to restrictions of applicable statutes) for all shareholders, and other factors.  Potentially available business opportunities may occur in many different industries and at various stages of development, all of which will make
the task of comparative investigation and analysis of such business opportunities extremely difficult and complex.



As is customary in the industry, we may pay a finders fee for locating an acquisition prospect.  If any such fee is paid, it will be approved by the Companys Board of Directors and will be in accordance with the industry standards.  Such fees are customarily between 1% and 5% of the size of the transaction, based upon a sliding scale of the amount involved. The amount of any such fees is not known at this time.



We currently have insufficient capital with which to provide the owners of business opportunities with any significant cash or other assets.  However, management believes the Company may be able to offer owners of business opportunities the opportunity to



6




acquire a controlling ownership interest in a company that could gain public status at substantially less cost than is required to conduct an initial public offering.



The owners of the business opportunities will, however, typically incur significant post-merger or acquisition registration costs in the event they wish to register a portion of their shares for subsequent sale.  We will likely also incur significant legal and accounting costs in connection with the acquisition of a business opportunity including the costs of preparing post-effective amendments, Forms 8-K, agreements and related reports and documents, nevertheless, the officers and directors of the Company have not conducted market research and are not aware of statistical data which would support the perceived benefits of a merger or acquisition transaction for the owners of a business opportunity. For these and other reasons, we are subject to continuing uncertainties.



Item 1a.  Factors that May Affect Future Results



We have no significant assets, business, or operations and there can be no assurance that we will ever have or acquire any assets, business, or operations at any time in the future.  The Company is a mere Anon-trading public shell@ and currently we do not have any certain prospect of ever acquiring any business or operations.  An investment into the Company or the purchase of our common stock should be considered appropriate only for those persons who can accept the total loss of their investment since the Company and the Company=s securities involve continuing and substantial risks that are not suitable or appropriate for investment purposes.  Overall, these risks arise from factors over which the Company will have little or no control.  Some adverse events may be more likely than others and the consequence of some adverse events may be greater than others.  No attempt has been made to
rank risks in the order of their likelihood or potential harm.  In addition to those general risks enumerated elsewhere, any purchaser of the Company's Common Stock should also consider the following factors.



1.  Lack of Business, Uncertainty, & Lack of Financial Resources and Lack of Any Source of Financing.While we are seeking to acquire a business or an interest in an operating company, the Company has no current active business. Under these circumstances and since the Company has and will continue to need financing to support its continued existence as a corporate enterprise.   Further, we have only a minimal amount of financial resources and there is no certain prospect that the Company will obtain sufficient financial resources in the future.



2. Uncertainties of Company and Uncertainties of Future Plans.In the event that we are unable to develop any plans to develop or acquire a business for the Company or if the Company is unable to obtain necessary financing to support its corporate existence, we may not achieve any of our goals or plans.  In addition, the regulatory burden imposed on us may increase as new securities laws and rules may limit our ability to acquire or close any acquisition.



3.  Limited Management Time & Limited Management.We have only one corporate officer and he is employed on a full time basis in other pursuits. We have no current



7



ability to pay suitable cash compensation to our sole officer and there can be no assurance that we will have sufficient cash resources in the future to do so.



4. No Existing Public Market.  There is no public market for our Common Shares, and there is no guarantee that we will be successful in gaining any trading market for our common stock or, if one is achieved, that a continuous liquid trading market will ever develop.  There can be no assurance that our Common Shares will ever gain any liquid trading volumes in any other market or gain listing on any stock exchange. Further, our Common Stock would likely have the status of a Penny Stock and as such, the ability of the Company to gain a liquid trading market for it will be inhibited by various regulations and there can be no assurance that any liquid trading market for our Common Stock will ever develop or, if it does develop, that it can be maintained.



5. Potential Dilution.In the event that the Company obtains any new financing or acquires a business or entity, the Company will likely result in substantial and on-going dilution of the Company's existing stockholders.  While there can be no guarantee that the Company will be successful in raising additional capital, if the Company is successful in obtaining any additional capital, existing stockholders will likely incur substantial dilution.



Item 2.  Description of Property



The Company maintains an office on a rent free basis under an oral agreement with the Companys sole officer and director, Derek Jones.



Item 3.  Legal Proceedings



The Company was not a party to any legal proceedings during 2006.



Item 4.  Submission of Matters to a Vote of Security Holders.



The Company has not held any meeting of the Company=s shareholders in 2006 and no

action of the Companys shareholders was taken in 2006.



PART II




Item 5.
        Market for Common Equity and Related Stockholder Matters.



The Company's Common Stock is not traded on any market and there is no guarantee that the Companys common stock will gain any status as a publicly-traded company in the near future.



The Company has followed the policy of reinvesting earnings, if any, and, consequently, has not paid any cash dividends.  At the present time, no change in this policy is under consideration by the Board of Directors.  The payment of cash dividends in the future



8




will be determined by the Board of Directors in light of conditions then existing, including the Company's earnings, financial requirements and condition, opportunities for reinvesting earnings, business conditions and other factors.



The number of shareholders of record of Common Stock on December 31, 2006 was approximately 35.



Item 6.  Managements Discussion and Analysis or Plan of Operation.



The Companys discussion and analysis of its financial condition and results of operations and plan of operation are based upon its consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States.  The preparation of these financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, and expenses and related disclosures of contingent liabilities.  On an ongoing basis, management evaluates its estimates, including those that relate to income tax contingencies, revenue recognition, and litigation.  Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets
and liabilities that are not readily apparent from other sources.  Actual results may differ from these estimates under different assumptions and conditions. If actual results significantly differ from managements estimates, our financial condition and results of operations could be materially impaired.



Plan of Operation



We seek to acquire a business or a business entity.  While we have had limited discussions with potential acquisition candidates, we have not identified any specific business, industry, or entity to acquire.



We continue to review and evaluate potential transactions but we can not be certain that we will be successful in identifying a suitable acquisition candidate or, if we are successful, that any transaction can be completed on any reasonable terms.



We are aware that the negotiations and closing of any acquisition may far exceed our current resources.  We continue to evaluate our options and, to the extent that we are able, to examine potential acquisition opportunities.



Management Discussion and Analysis



Fiscal 2006 vs. Fiscal 2005



During the twelve months ending December 31, 2006 (AFiscal 2006"), our Revenues were $0 which compares to our Revenues of $0 for the twelve month period ending December 31, 2005 (AFiscal 2005").   The absence of revenues during both periods reflects the lack of any business.



9




During Fiscal 2006, we did record $54,361 as General Selling and Administrative Expenses.  This compares to $4,067 in General Selling and Administrative Expenses incurred during Fiscal 2005.  The increase in these expenses during Fiscal 2006 reflected the increased administrative and managerial efforts undertaken by us during Fiscal 2006. These expenses were primarily composed of office and management expenses; and accounting, legal, and other general and administrative expenses.



During Fiscal 2006 we recorded $2,669 in Other Income, $29,000 as a Gain on Marketable Securities and $4,000 as Interest Expense.  The $29,000 was recorded after the Company sold 100,000 shares of Whos Your Daddy, Inc. (OTCBB: WYDY) that were previously acquired. During Fiscal 2005, we recorded $75 as a Loss on Marketable Securities.



As a result, we recorded Net Loss from Continuing Operations of $26,692 during Fiscal 2006 compared to a Net Loss from Continuing Operations of only $4,142 during Fiscal 2005.  The amount of our Net Loss in Fiscal 2006 was $26,692 and the Net Loss in Fiscal 2005 was $4,142.



The number of shares of our common stock during Fiscal 2006 was 7,166,582 compared to 301,116 during Fiscal 2005.  This resulted in a Basic Loss Per Share of ($0.00) in Fiscal 2006 compared to a Basic Loss Per Share of ($0.01) in Fiscal 2005. There is no certain prospect that we will generate revenues in the near future.



Critical Accounting Policies



The preparation of our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America requires us 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 amount of revenues and expenses during the reporting periods.  We are required to make judgments and estimates about the effect of matters that are inherently uncertain.  Actual results could differ from our estimates.  While we are a development-stage company, the most significant areas involving our judgments and estimates are principally those involving our current liabilities and current assets.



Going Concern



We currently have no source of operating revenue, and have only limited working capital with which to pursue our business plan.  The amount of capital required to sustain operations until we acquire a suitable business or entity is not known.  It likely will be necessary for us to secure additional working capital through loans or sales of common stock, and there can be no assurance that such funding will be available in the future. These conditions raise substantial doubt about our ability to continue as a going concern.






10




Off Balance Sheet Arrangements



We are not currently party to any off balance sheet arrangement as that term is defined in Item 303 (c)(2) of Regulation SB.





Safe Harbor for Forward-Looking Statements



This Form 10-KSB contains forward-looking statements as defined by federal securities laws which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  Forward-looking statements are statements concerning plans, objectives, goals, strategies, expectations, intentions, projections, developments, future events, performance or products, underlying (express or implied) assumptions and other statements which are other than historical facts.  In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "could," "expects," "intends," "plans," "anticipates," "contemplates," "believes," "estimates," "predicts," "projects," and other similar terminology or the negative of these terms. From time to time we may publish or otherwise make available forward-looking statements of this nature.  All such forward-looking statements,
whether written or oral, and whether made by us or on our behalf, are expressly qualified by the cautionary statements described in this Form 10-KSB, including those set forth in Section 1A entitled "Factors That May Affect Future Results."  In addition, we undertake no obligation to update or revise any forward-looking statement to reflect events, circumstances, or new information after the date of this Form 10-KSB or to reflect the occurrence of unanticipated or other subsequent events, and we disclaim any such obligation.



Liquidity and Capital Resources



As of December 31, 2006 the Company had Total Current Liabilities of $0 compared to $20,000 as of December 31, 2005.



On December 31, 2006, the Company had $65,119 in Total Assets compared to $13,211 in Total Assets as of December 31, 2005.  Since the Company has no source of revenues or existing business, the ability of the Company to meet its financial commitments is not certain.  The Company continues to control its cash outlays and monitor the expenses it incurs so as to avoid unnecessary and unexpected cash needs.



Impact of Inflation



Because of our lack of any existing business, we do not believe that inflation had a significant impact on its sales or profits.







11



Item 7.  Financial Statements.



The financial statements and related financial information required to be filed hereunder are indexed on page F-1 of this report and are incorporated herein by reference.



Item 8. Changes in and Disagreements with Accountants.



None.





Item 8A.  Controls and Procedures.



Disclosure Controls and Procedures



The Companys management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Companys disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the Exchange Act)) as of the end of the period covered by this report.  Based on such evaluation, Chief Executive Officer has concluded that, as of the end of such period, the Companys disclosure controls and procedures are effective in recording, processing, summarizing and reporting information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act, but that such disclosure controls and procedures are not effective to insure reporting is on a timely basis.  In addition, our Chief Executive Officer has concluded
that, as of the end of such period, the Companys disclosure controls and procedures are effective in ensuring that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Companys management, including the Companys Chief Executive Officer and Chief Financial Officer, as appropriate but that such disclosure controls and procedures are not effective to insure information is communicated to allow for timely decisions regarding required disclosure.



Changes in Internal Controls Over Financial Reporting



There have not been any changes in the Companys internal controls over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during our most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Companys internal controls over financial reporting.



Managements Report on Internal Control Over Financial Reporting



The Companys management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-



12





Report of Independent Registered Public Accounting Firm
        F-2Consolidated Balance Sheets
        F-3Consolidated Statements of Operations
        F-4Consolidated Statement of Stockholders Equity
        F-5Consolidated Statements of Cash Flows
        F-6Notes to Consolidated Financial Statements
        F-7




F-1




Chang G. Park, CPA, Ph. D.

371 E STREET  CHULA VISTA  CALIFORNIA 91910-2615(

TELEPHONE (858)722-5953  FAX (858) 408-2695   FAX (858) 764-5480

E-MAILchanggpark@gmail.com(



Report of Independent Registered Public Accounting Firm



To the Board of Directors and Stockholders

Quantum Companies, Inc.

(A Development Stage Company)



We have audited the accompanying balance sheet of Quantum Companies, Inc. (A Development Stage Company) as of December 31, 2006 and the related statements of operation, changes in shareholders equity and cash flows for the years then ended, and for the period from October 15, 1999 (inception) to December 31, 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. The financial statements of Quantum Companies, Inc. as of December 31, 2005, and for the period from October 15, 1999 (inception) to December 31, 2005 were audited by other auditors whose report dated March 1, 2006, expressed an unqualified opinion on those statements.  Their report included an explanatory paragraph regarding going concern.



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.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.  An audit also includes 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 Quantum Companies, Inc. as of December 31, 2006, and the results of its operation and its cash flows for the year then ended, and for the period from October 15, 1999 (inception) to December 31, 2006 in conformity with U.S. generally accepted accounting principles.



The financial statements have been prepared assuming that the Company will continue as a going concern.  As discussed in Note 3 to the financial statements, the Companys losses from operations raise substantial doubt about its ability to continue as a going concern.  The financial statements do not include any adjustments that might result from the outcome of this uncertainty.





/s/Chang G. Park

CHANG G. PARK, CPA



March 8, 2007

San Diego, CA. 91910





Member of the California Society of Certified Public Accountants

Registered with the Public Company Accounting Oversight Board



F-2



QUANTUM COMPANIES, INC.(A Development Stage Company)Balance SheetsASSETSAs of
        
        
        As ofDecember 31,
        
        
        December 31,2006
        
        
        2005Current AssetsCash
        $
        119
        
        $
        6,666Trading securities
        
        -
        
        
        1,125Loan receivable
        
        65,000
        
        
        -Total Current Assets
        
        65,119
        
        
        7,791Other AssetsInvestments in other companies
        
        -
        
        
        2,000Web-site
        
        -
        
        
        3,420Total Other Assets
        
        -
        
        
        5,420TOTAL ASSETS
        $
        65,119
        
        $
        13,211.LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT)Current LiabilitiesAccounts payable
        $
        -
        
        $
        -Loan payable - related party
        
        -
        
        
        20,000Total Current Liabilities
        
        -
        
        
        20,000TOTAL LIABILITIES
        
        -
        
        
        20,000STOCKHOLDERS' EQUITY (DEFICIT)Common stock ($0.001 par value, 100,000,000 shares



authorized; 12,408,500 and 308,500 shares issued andoutstanding as of December 31, 2006 and 2005)
        
        12,409
        
        
        3,085Additional paid-in capital
        
        205,441
        
        
        117,765Stock subscription receivable
        
        -
        
        
        (1,600)Deficit accumulated during development stage
        
        (152,731)
        
        
        (126,039)Total Stockholders' Equity (Deficit)
        
        65,119
        
        
        (6,789)TOTAL LIABILITIES &STOCKHOLDERS' EQUITY (DEFICIT)
        $
        65,119
        
        $
        13,211














F-3


QUANTUM COMPANIES, INC.







(A Development Stage Company)Statements of OperationsOctober 15, 1999(Inception)Year Ended
        
        
        Year Ended
        
        
        throughDecember 31,
        
        
        December 31,
        
        
        December 31,2006
        
        
        2005
        
        
        2006Revenues
        $
        -
        
        $
        -
        
        $
        -Operating ExpensesGeneral & administrative expenses
        
        54,361
        
        
        4,067
        
        
        94,893Total Operating expenses
        
        54,361
        
        
        4,067
        
        
        94,893Operating Income (Loss)
        
        (54,361)
        
        
        (4,067)
        
        
        (94,893)Other Income (Expenses)Loss in investment
        
        -
        
        
        -
        
        
        (3,000)Loss on marketable securities
        
        -
        
        
        -
        
        
        (900)Other income
        
        2,669
        
        
        -
        
        
        2,781Gain on marketable securities
        
        29,000
        
        
        (75)
        
        
        29,225Interest expense
        
        (4,000)
        
        
        -
        
        
        (4,000)Total Other Income (Expenses)
        
        27,669
        
        
        (75)
        
        
        24,106Net Income (Loss) from continuing operations
        $
        (26,692)
        
        $
        (4,142)
        
        $
        (70,787)Discontinued OperationsGain (loss) on operations of apartment building
        
        -
        
        
        -
        
        
        (81,944)Net Income (Loss)
        
        (26,692)
        
        
        (4,142)
        
        
        (152,731)Basic Income (Loss) Per Share
        $
        (0.00)
        
        $
        (0.01)



Weighted average number ofcommon shares outstanding
        
        7,166,582
        
        
        301,116











































F-4




QUANTUM COMPANIES, INC.(A Development Stage Company)Statement of Changes in Stockholders' Equity (Deficit)From October  15, 1999 (inception) through December 31, 2006DeficitCommon
        Additional
        Stock
        AccumulatedCommon
        Stock
        Paid - in
        Subscription
        During
        TotalStock
        Amount
        Capital
        Receivable
        DevelopmentStageBeginning balance, October 15, 1999
        -
        $                 -
        $                 -
        $                 -
        $                 -
        $                 -Common stock issued on October 15, 1999 fororganization costs @ $0.1 per share
        10,000
        10
        990
        
        
        1,000Net income,  December 31, 1999
        
        
        
        
        -Balance,  December 31, 1999
        10,000
        10
        990
        -
        -
        1,000Common stock issued on September 5, 2000 inconnection with a private placement valued @$0.1 per share (less $5,000 stock subscription)
        155,000
        155
        15,345
        (5,000)
        
        10,500Common stock issued on September 5, 2000 forsubscription receivable @ $0.1 per share
        16,000
        16
        1,584
        (1,600)
        
        -Net loss,  December 31, 2000
        
        
        
        
        (1,000)
        (1,000)Balance,  December 31, 2000
        181,000
        181
        17,919
        (6,600)
        (1,000)
        10,500Common stock issued on March 1, 2001 inconnection with a real estate purchase contractvalued @ $1.00 per share
        100,000
        100
        99,900
        
        
        100,000Net loss,  December 31, 2001
        
        
        
        
        (8,304)
        (8,304)Balance,  December 31, 2001
        281,000
        281
        117,819
        (6,600)
        (9,304)
        102,196Stock subscription received on April 30, 2002
        
        
        
        5,000
        
        5,000Net loss,  December 31, 2002
        
        
        
        
        (81,505)
        (81,505)



Balance,  December 31, 2002
        281,000
        281
        117,819
        (1,600)
        (90,809)
        25,691Common stock issued on April 9, 2003 fordirectors fees @ $0.1 per share
        17,500
        18
        1,732
        
        
        1,750Common stock issued on April 9, 2003 toCorporate Capital @ $0.1 per share
        10,000
        10
        990
        
        
        1,000Net loss,  December 31, 2003
        
        
        
        
        (17,869)
        (17,869)Balance,  December 31, 2003
        308,500
        309
        120,541
        (1,600)
        (108,678)
        10,572Net loss,  December 31, 2004
        
        
        
        
        (13,219)
        (13,219)Balance,  December 31, 2004
        308,500
        309
        120,541
        (1,600)
        (121,897)
        (2,647)Net loss,  December 31, 2005
        
        
        
        
        (4,142)
        (4,142)Balance,  December 31, 2005
        308,500
        309
        120,541
        (1,600)
        (126,039)
        (6,789)Stock subscription
        
        
        
        1,600
        
        1,600Common stock issued on May 30, 2006 inexchange for 100,000 shares of WYDY stock
        7,300,000
        7,300
        65,700
        
        
        73,000Common stock issued on June 20, topay off debt @ $0.005 per share
        4,800,000
        4,800
        19,200
        
        
        24,000Net lncome,  December 31, 2006
        
        
        
        
        (26,692)
        (26,692)Balance,  December 31, 2006
        12,408,500
        $         12,409
        $       205,441
        $                 -
        $      (152,731)
        $         65,119

















F-5




QUANTUM COMPANIES, INC.(A Development Stage Company)Statements of Cash FlowsOctober 15, 1999(Inception)Year Ended
        
        
        Year Ended
        
        
        throughDecember 31,
        
        
        December 31,
        
        
        December 31,2006
        
        
        2005
        
        
        2006CASH FLOWS FROM OPERATING ACTIVITIESNet income (loss)
        $
        (26,692)
        
        $
        (4,142)
        
        $
        (152,731)Adjustments to reconcile net loss to net cashused in operating activities:Gain on marketable securities
        
        (29,000)
        
        
        -
        
        
        (29,000)Common stock issued for services
        
        -
        
        
        -
        
        
        2,750(Increase) decrease in assets:Accounts receivables
        
        -
        
        
        2,000
        
        
        -Investment in trading securities
        
        1,125
        
        
        75
        
        
        -Increase (decrease) in liabilities:Payables & current liabilities
        
        -
        
        
        (135)
        
        
        -Net cash provided by (used in) operating activities
        
        (54,567)
        
        
        (2,202)
        
        
        (178,981)CASH FLOWS FROM INVESTING ACTIVITIESNotes receivable
        
        (65,000)
        
        
        -
        
        
        (65,000)Investments
        
        2,000
        
        
        -
        
        
        -Website development
        
        3,420
        
        
        -
        
        
        -Procceds from selling marketable securities
        
        102,000
        
        
        -
        
        
        102,000Net cash provided by (used in) investing activities
        
        42,420
        
        
        -
        
        
        37,000CASH FLOWS FROM FINANCING ACTIVITIESStock subscription
        
        1,600
        
        
        -
        
        
        -Proceeds from loans payable
        
        4,000
        
        
        -
        
        
        24,000

Common stock
        
        -
        
        
        -
        
        
        2,810Paid in Capital
        
        -
        
        
        -
        
        
        115,290Net cash provided by (used in) financing activities
        
        5,600
        
        
        -
        
        
        142,100Net increase (decrease) in cash
        
        (6,547)
        
        
        (2,202)
        
        
        119Cash at beginning of year
        
        6,666
        
        
        8,868
        
        
        -Cash at end of year
        $
        119
        
        $
        6,666
        
        $
        119Supplemental Cash Flows Disclosures:Cash paid during period for interest
        $
        4,000.00
        
        $
        -Cash paid during period for income taxes
        $
        -
        
        $
        -Schedule of Non-Cash Activities:Common stock issued to pay off debt
        
        24,000
        
        
        -Issurance on common stock in exchange for WYDY stock
        $
        73,000
        
        $
        -97,000
        
        
        -


See accompanying notes to consolidated financial statements

F-6


QUANTUM COMPANIES, INC.

(A Development Stage Company)

Notes to Financial Statements

As of December 31, 2006






NOTE 1.
        ORGANIZATION AND DESCRIPTION OF BUSINESS



Quantum Companies, Inc. (the Company) was incorporated under the laws of the State of Nevada on October 15, 1999.  The Company was incorporated with the intent of acquiring real estate.  On January 30, 2001 the Company entered into an agreement to purchase a 7-unit apartment building from Triad Industries, Inc. a publicly traded company.  The Company purchased the property for $399,000 of which $100,000 was paid by the issuance of the Companys common stock, by issuing 1,000,000 shares at $.10 per share.  Due to logistics, the property was sold on August 13, 2002 for $350,000 to an unrelated third party.  Therefore the real estate operation is presented as a discontinued operation.  The Company received cash proceeds of about $27,000 from the sale of the property, of which it has approximately used $6,095 to develop Eshop Communities, Inc. (referred to hereafter as Eshop).



The Company is currently searching for an ideal merger candidate.  The Company has issued 12,408,500 shares of $0.001 par value common stock.




NOTE 2.
        SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES




a.
        Accounting Method



The Companys financial statements are prepared using the accrual method of accounting.  The Company has elected a December 31, year-end.




b.
        Cash Equivalents



The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.




c.
        Estimates and Adjustments



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 and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.  In accordance with FASB 16 all adjustments are normal and recurring.







F-7





QUANTUM COMPANIES, INC.

(A Development Stage Company)

Notes to Financial Statements

As of December 31, 2006






NOTE 2.
        SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES




d.
        Investments in Securities




Trading securities at December 31, 2005 were classified and disclosed as available for sale securities under the requirements of SFAS No. 130. Under such statement, the Companys securities are required to be reflected at fair market value.   As of December 31, 2006 the Company did not hold any investment in insecurities.




e.
        Basic Earnings per Share



In February 1997, the FASB issued SFAS No. 128, Earnings Per Share, which specifies the computation, presentation and disclosure requirements for earnings (loss) per share for entities with publicly held common stock.  SFAS No. 128 supersedes the provisions of APB No. 15, and requires the presentation of basic earnings (loss) per share and diluted earnings (loss) per share.  The Company has adopted the provisions of SFAS No. 128 effective October 15, 1999 (inception).



Basic net loss per share amounts is computed by dividing the net loss by the weighted average number of common shares outstanding.  Diluted earnings per share are the same as basic earnings per share due to the lack of dilutive items in the Company.




f.
        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 of all of the deferred tax assets will be realized.  Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.







F-8









QUANTUM COMPANIES, INC.

(A Development Stage Company)

Notes to Financial Statements

As of December 31, 2006






NOTE 3.
        GOING CONCERN



The accompanying financial statements are presented on a going concern basis.  The Company had no operations during the period from October 15, 1999 (inception) to December 31, 2006 and generated a net loss of $152,731. This condition raises substantial doubt about the Company's ability to continue as a going concern. The Company's continuation as a going concern is dependent on its ability to meet its obligations, to obtain additional financing as may be required and ultimately to attain profitability. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.



NOTE 4.  BASIC INCOME / (LOSS) PER COMMON SHARE



Basic gain (loss) per common share has been calculated based on the weighted average number of shares of common stock outstanding during the period.  Diluted gain (loss) per common share has been calculated based on the weighted average number of shares of common and preferred stock outstanding during the period.




December 31,
        December 30,2006
        2005Net income (loss) from operations  (Numerator)
        $        (26,692)
        $       (4,142)Weighed average number of shares outstanding  (Denominator)
        7,166,582
        301,116Basic Income (Loss) Per Share
        $          (0.00)
        $         (0.01)





NOTE 5.  INCOME TAXES




As of December 31, 2006Deferred tax assets:Net operating tax carryforwards
        $            51,929Other
        -0-Gross deferred tax assets
        51,929Valuation allowance
        (51,929)Net deferred tax assets
        $              -0-



Realization of deferred tax assets is dependent upon sufficient future taxable income during the period that deductible temporary differences and carryforwards are expected to be available to reduce taxable income.  As the achievement of required future taxable income is uncertain, the Company recorded a valuation allowance.


F-9



QUANTUM COMPANIES, INC.

(A Development Stage Company)

Notes to Financial Statements

As of December 31, 2006





NOTE 6.  SCHEDULE OF NET OPERATING LOSSES




1999  Net Operating Income
        
        $                02000  Net Operating Loss
        
        (1,000)2001  Net Operating Loss
        
        (8,304)2002  Net Operating Loss
        
        (81,505)2003  Net Operating Loss
        
        (17,869)2004  Net Operating Loss
        
        (13,219)2005  Net Operating Loss
        
        (4,142)2006  Net Operating Loss
        
        (26,692)Net Operating Loss
        
        $     (152,731)



As of December 31, 2006, the Company has net operating loss carryforwards of approximately $152,731.  Net operating loss carryforward expires twenty years from the date the loss was incurred.



NOTE 7.  STOCK TRANSACTIONS



Transactions, other than employees stock issuance, are in accordance with paragraph 8 of SFAS 123. Thus issuances shall be accounted for based on the fair value of the consideration given up or received; whichever is more readily determinable. Transactions with employees stock issuance are in accordance with paragraphs (16-44) of SFAS 123. These issuances shall be accounted for based on the fair value of the consideration received or the fair value of the equity instruments issued, or whichever measure is deemed more reliable.  On May 30, 2006 the board approved a 1:10 reverse of the common stock.  All issuances have been retroactively adjusted.



On October 15, 1999, the Company issued 10,000 shares of common stock at $.01 for consideration of $1,000 for organizational costs incurred by others for the Company.



In September of 2000, the Company issued 1,710,000 shares of common stock at $.10 in conjunction with a private placement offering by the Company for total consideration of $17,100.  The Company received cash of $10,500 and is due $6,600 that has been recorded by the receipt of a stock subscription receivable by the Company.



On March 31, 2001, the Company issued 100,000 shares of common stock at $1.00 per share or consideration of $100,000 for the down payment of the Bancroft property purchase.



In April of 2002, the Company received $5,000 of the $6,600 the Company was due from the outstanding stock subscription receivable.






F-10



QUANTUM COMPANIES, INC.

(A Development Stage Company)

Notes to Financial Statements

As of December 31, 2006





NOTE 7.  STOCK TRANSACTIONS (CONTINUED)



On April 9, 2003, the Company issued 17,500 shares of common stock at $0.10 per share to directors for services rendered.



On April 9, 2003 the Company issued 10,000 shares of common stock at $0.10 per share to Corporate Capital formation for services rendered.



On May 30, 2006, the Company issued 7,300,000 shares of common stock at $0.73 per share in exchange of 100,000 shares of WYDY common stock.



On June 22, 2006, the Company issued 4,800,000 shares of common stock at $0.005 per share to pay a note payable.



As of December 31, 2006, the Company had 12,408,500 shares of common stock issued and outstanding.



NOTE 8.  STOCKHOLDERS EQUITY



The stockholders equity section of the Company contains the following class of capital stock as of December 31, 2006.





        Common stock, $0.001 par value; 100,000,000 shares authorized: 12,408,500 shares issued and outstanding as of December 31, 2006.







F-11













15(f) and 15d-15(f) under the Exchange Act.  The Companys internal control over financial reporting has been designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with accounting principles generally accepted in the United States of America.



The Companys internal control over financial reporting includes policies and procedures that pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect transactions and dispositions of assets of the Company; provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America, and that receipts and expenditures are being made only in accordance with authorization of management and directors of the Company; and provide reasonable assurance regarding prevention or detection of unauthorized acquisition, use or disposition of the Companys assets that could have a material effect on the Companys financial statements.  Management believes the internal control policies and procedures have been and are
likely to continue to be effective in meeting these needs.



In addition, our internal control over financial reporting also includes policies and procedures that pertain to the timeliness of information and reporting, both to management and to the public.  These policies and procedures are important to support Managements decision making processes, to quickly identify inappropriate activities and minimize loss, and to empower investors with timely information in support of their investment decisions.  Management has determined that these internal control policies and procedures have not been effective to ensure that financial statements for internal and external reporting purposes are prepared on a timely basis.  In addition, management does not believe the necessary changes to these control policies and procedures to rectify this deficiency have been implemented.  As such, management believes financial statements may continue to suffer from
lack of timely preparation and dissemination, and that this condition will continue until adequate changes have been designed and implemented.



Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.



Item 8B.  Other Information




None.









13




PART III



Item 9.  Directors, Executive Officers, Promoters, and Control Persons; Compliance With Section 16(a) of the Exchange Act.



Directors and Executive Officers



Our By-laws authorize four directors. Currently we have only one Director. The Director serves until the next annual meeting of shareholders or until their successors are elected.  The officers serve at the pleasure of the Board of Directors.  Information as to the directors and executive officers of the Company is as follows:






Name
        Age
        Position
        Date Elected






Derek Jones
        69
        CEO, Chairman, Chief Financial
        04/01/06



3200 Airport Avenue,
        Officer, & Secretary

Santa Monica, CA 90405


La Jolla,  California 92037





Mr. Jones may be deemed a "promoter" of the Company, as that term is defined in the rules and regulations promulgated under the Securities Act of 1933.  Directors are elected to serve until the next annual meeting of stockholders and until their successors have been elected and have qualified.



Derek Joneswas elected the Companys Chief Executive Officer, Chairman, Chief Financial Officer, and Secretary on April 1, 2006.  From September 2001 to the present, Mr. Jones has been employed as a consultant.  Mr. Jones is also a Director of Whos Your Daddy, Inc., a publicly-traded company (OTCBB).



Compliance with Section 16(a) of the Exchange Act



Section 16(a) of the Securities Exchange Act of 1934 (the "Exchange Act") requires the Company's directors, executive officers and persons who own more than 10% of the Company's Common Stock (collectively "Covered Persons") to file initial reports of ownership (Form 3) and reports of changes in ownership of Common Stock (Forms 4 and Forms 5) with the Securities and Exchange Commission as well as the Company and any exchange upon which the Company's Common Stock is listed.



14




The Company is required to identify Covered Persons that the Company knows have failed to file or filed late Section 16(a) reports during the previous fiscal year.  To the Company's knowledge, the following Covered Persons during the fiscal year ended December 31, 2006 failed to file on a timely basis reports required by Section 16(a) of the Exchange Act:



No. of Reports Not


Filed



Name
        Position
        a Timely Basis(1)




Derek Jones
        Chief Executive Officer
        Form 3 and 4

____________________



(1)To the Company's knowledge, based solely on a review of the copies of the reports furnished to the Company by such persons, in the fiscal year ended December 31, 2006.



Item 10.  Executive Compensation



Compensation Discussion and Analysis



During 2006, the Company did not pay or compensate the Companys officers or directors.   The Company has limited cash reserves and the Company sole employee is its Chioef Executive Officer, Derek Jones.  Since the Company is not a listed company (as that term is defined under SEC rules) and as a result the Company does not maintain and is not required to maintain a Compensation Committee.  The Companys limited financial resources and its limited prospect of obtaining any financial resources in the future has precluded the Company from entering into or giving any commitment for any long-term cash compensation to any officer or director.



Currently, the Company's Board of Directors has authorized the compensation of its officers with the following annual cash salaries:



SUMMARY COMPENSATION TABLE 1






Annual Compensaton
        Long-Term CompensationAwards                 PayoutsName and
        
        
        
        Other
        
        
        LTIPPrincipal
        
        Salary
        Bonus
        Annual
        Restricted
        Securities
        PayoutsPosition
        Year
        ($)
        ($)
        Compen-
        Stock
        Underly-ing
        ($)
        All Other(a)
        (b)
        (c)
        (d)
        sation
        Awards
        Options/
        (h)
        Compen-($)
        (s)
        SARs
        
        sation





15




(e)
        ($)
        (#)
        
        ($)(f)
        (g)
        
        (i)Derek JonesChairman,CEO,
        2004
        $0
        $0
        $0
        $0
        0
        $0
        $0Secretary,
        2005
        $0
        $0
        $0
        $0
        0
        $0
        $0and CFO......
        2006
        $5,000
        $0
        $5,000
        $0
        0
        $0
        $0Total for AllOfficers andDirectors asa group (1
        2004
        $0
        $0
        $0
        $0
        0
        $0
        $0person)
        2005
        $0
        $0
        $0
        $0
        0
        $0
        $02006
        $5,000
        $0
        $5,000
        $5,000
        0
        $0
        $0





Footnotes:



* No other compensation was paid, accrued or received by any of the Companys officers or directors for any of the years shown.



(1) No stock options were issued or granted in 2004, 2005 or 2006.



With respect to cash salaries, the Company may change or increase salaries as the

Company's profits and cash flow allow.  The amount of any increase in salaries and compensation for existing officers has not been determined at this time and the number and dollar amount to be paid to additional management staff that will likely be employed has not been determined.



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 as of April 10, 2007:




Name of Stockholder
        No of Common Shares Held
        No. of Votes
        Percentage of Total VotesOutstanding (1)Derek Jones, CEOTreasurer, Secretary,
        100,000 Shares
        100,000
        0.81%& Chairman





16




OPTION/SAR GRANTS IN LAST TWO FISCAL YEARS

(2006 Fiscal Year Individual Grants)




No. Of
        Percent ofSecurities
        Total Options/Underlying
        SARs Granted
        Exercise ofOptions/SARS
        to Employees
        Base PriceGranted
        in Fiscal Year
        ($/Sh)
        ExpirationName
        (#)
        (c)1
        (d)
        Date(a)
        (b)
        
        
        (e)None
        0
        0%
        $0
        --Total
        0
        0%
        $0
        -



Footnote:



(1) The Company did not have any outstanding exercisable stock options as of December 31, 2006.



Stock Options



The Company did not grant or issue any stock options in 2004, 2005, or 2006.



Item 12.  Certain Relationships and Related Transactions.



None.




Item 13.
        Exhibits and Reports on Form 8-K



(a) Reports on Form 8-K.



None.



(b) The Company hereby files the following Exhibits with this Annual Report:




31.1
        Certification



31.2
        Certification



32.1
        Certification



32.2
        Certification







17




Item 14.
        Principal Accountant Fees and Services



Audit Fees



The anticipated aggregate fees to Chang Park, for professional services rendered for the audit of the Companys annual financial statements for the fiscal year ended December 31, 2006 and for the reviews of the financial statements included in the Companys Quarterly Reports on Form 10-QSB for that fiscal year are approximately $10,000. Audit related services generally include fees for accounting consultations, business acquisitions, and work related thereto.  No audit-related fees for assurance and related services were billed by or paid to Chang Park, CPA in 2004 or in 2005.




Tax Fees



An aggregate of $0 was spent for Tax Fees (as defined in Item 14(3) of Form 10-KSB of the Securities and Exchange Commission) during the last two fiscal years ended December 31, 2006.




Other Fees



No other fees for audit-related services or products were billed by or paid to Chang Park, CPA, in 2005 or 2006.



Audit Committee Charter



The Company currently does not have an audit committee but the Company intends to establish an Audit Committee of the Companys Board of Directors and thereby to establish a Charter for the Audit Committee.  For the year ending December 31, 2006 and due to limited financial resources, the Company has delayed the implementation of these plans until such later date at which the Company may have the financial resources available.




Audit Committee Report



Since the Company did not establish an Audit Committee for the year ending December 31, 2006, no Audit Committee Report for that period is available.











18




SIGNATURES



In accordance with Section 13 or 15(d) of the Exchange Act, the Registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.









(Registrant):

Quantum Companies, Inc.



Date: April 11, 2007


By: /s/Derek Jones



Derek Jones

Chief Executive Officer

Chairman of the Board, Secretary, and

Chief Financial Officer





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






By:/s/ Derek Jones
        Date: April 11, 2007



Derek Jones

Chief Executive Officer





19