UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.   20549



FORM 10-KSB





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|[ X ] | ANNUAL REPORT UNDER SECTION 13 0R 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



For the fiscal year endedDecember 31, 2006




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|[    ] | TRANSITION REPORT UNDER SECTION 13 0R 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



For the transition period fromCommission file number000-30919






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|CTT INTERNATIONAL DISTRIBUTORS INC.           
|(Name of Small Business Issuer in its charter)





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|Delaware                                                       |            | 98-6218467                          
|(State or other jurisdiction of incorporation or organization) |            | (I.R.S. Employer Identification No.)
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|500 Mamaroneck Ave., Harrison, New York                        |            | 10528                               
|(Address of principal executive offices)                       | (Zip Code)



Issuers telephone number  (914) 777-2090





Securities registered pursuant to Section 12(b) of the Act:

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|Title of each class |  | Name of each exchange on which registered
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|None                |  | N/A                                      





Securities registered pursuant to Section 12(g) of the Act:





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|Common Stock - $0.0001 par value
|(Title of Class)                



Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the last 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes   [ X ]     No   [    ]



Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B is not contained in this form, and no disclosure will be contained, to the best of registrants knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or any amendment to this Form 10-KSB.  [ 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









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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 2





State issuers revenues for its most recent fiscal year.

$936



State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was sold, or the average bid and asked price of such common equity, as of a specified date within the past 60 days: Inapplicable. Common Stock has not traded.



State the number of shares outstanding of each of the issuers classes of common equity, as of the latest practicable date.



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| | -------------------------------- | ---------------------------
| | Class                            | Outstanding at May 14, 2007
| |                                  |                            
| | Common Stock - $0.0001 par value | 9,397,101                  



Documents incorporated by reference:

None



Transitional Small Business Disclosure Format (Check one):Yes   [   ]     No   [ x ]









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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 3







Forward Looking Statements



This Annual Report on Form 10-KSB for the year ended December 31, 2006, including the discussion of the business of CTT Distributors International Inc. (CTT or the Company), managements discussion and analysis of financial condition and results of operations, as well as other sections of this Annual Report contain forward-looking statements within the meaning of United States federal securities laws.  Certain information contained or incorporated by reference in this Annual Report, including the information set forth as to the future financial or operating performance of CTT, constitutes forward-looking statements.  These statements may be identified by their use of words like plans, expect, aim, believe, projects, anticipate, intend, estimate, will, should, could, contemplate, target, continue, budget, may, schedule, and other similar expressions that indicate future events and trends and identify forward-looking statements.  All statements, other than historical statements of fact, that address expectations or projections about the future, including statements about CTTs strategy for growth, product development, market position, expenditures and financial results, are forward-looking statements.



Forward-looking statements in this Form 10-KSB include statements regarding (1) expectation that revenue will increase during fiscal 2007; (2) expectation of business operations increasing as a result of website development and an increase in marketing; (3) expectation of future operating expenses increasing; (4) expectation that the expansion of business operations will cause marketing and promotional costs to increase; (5) expectation that working capital needs for fiscal 2007 will be funded through the equity capital markets and private financings; (6) expectation that an increase in business operations will lead to hiring of additional employees or independent contractors; (7) expectation of future developments of content, products, features, and services to be provided on the website; (8) uncertainty of utilizing deferred tax assets; and (9) expectation that inflation will not have a material impact on future operations.  All forward-looking statements are made as of the date of filing of this Form 10-KSB and CTT disclaims any duty to update such statements.



These forward-looking statements involve a number of risks and uncertainties, including, but not limited to, those discussed in these paragraphs.  Factors that could cause future results to differ from these expectations include general economic conditions particularly related to demand for CTTs products and services; changes in business strategy; competitive factors (including the introduction or enhancement of competitive services); pricing pressures; changes in operating expenses; inability to attract or retain consulting, sales and/or development talent; changes in customer requirements; and/or evolving industry standards; and other factors described in CTTs filings with the Securities and Exchange Commission.  The results that CTT achieves may differ materially from any forward-looking statements due to these risks and uncertainties.  The forward-looking statements in this Form 10-KSB for the fiscal year ended December 31, 2006, are subject to risks and uncertainties that could cause actual results to differ materially from this results expressed in or implied by the statements contained in this report.



As a result, the identification and interpretation of data and other information and their use in developing and selecting assumptions from and among reasonable alternatives requires the exercise of judgment.  To the extent that the assumed events do not occur, the outcome may vary substantially from anticipated or projected results, and accordingly, no opinion is expressed on the achievability of those forward-looking statements.  No assurance can be given that any of the assumptions relating to the forward-looking statements specified in the following information are accurate.  All forward-looking statements are made as of the date of filing of this Form 10-KSB and CTT disclaims any duty to update any such forward-looking statements.



CTT may, from time to time, make oral forward-looking statements.  CTT strongly advises that the above paragraphs and the risk factors described in this Annual Report and in CTTs other documents filed with the United States Securities and Exchange Commission should be read for a description of certain factors that could cause the actual results of CTT to materially differ from those in the oral forward-looking statements.  CTT disclaims any intention or obligation to update or revise any oral or written forward-looking statements whether as a result of new information, future events or otherwise.









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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 4





PART I



Item 1.

Description of Business.



General



CTT International Distributors Inc. (CTT) is a holding company merged under the laws of the State of Delaware on January 7, 2005.  CTT was formed by the merger of Slabsdirect.com, Inc. and CTT International Distributors Inc.  Slabsdirect.com, Inc. was incorporated under the laws of the State of Delaware on January 14, 2000 (Slabsdirect).  CTT International Distributors Inc. was incorporated under the laws of the State of Delaware on November 1, 2004.  As part of the merger, the Articles of Slabsdirect.com, Inc. were adopted as the Articles of CTT.



CTT has one subsidiary, CTT Distributors Ltd. (the Subsidiary), which is the operating company and was incorporated under the laws of the Province of British Columbia on May 17, 2004.  The Subsidiary is a wholly-owned subsidiary of CTT.



Pursuant to a share exchange agreement dated December 29, 2004, Slabsdirect agreed to issue 455,001 shares of common stock in exchange for all of the issued and outstanding shares of common stock of the Subsidiary.  The acquisition was considered a reverse acquisition for accounting and financial reporting purposes.  See Exhibit 10.1  Share Exchange Agreement for more details.



Prior to the acquisition of the Subsidiary, Slabdirects sole asset consisted of ownership of a 100% interest in the issued and outstanding capital stock of Slabsdirect.com Online (BC) Ltd. (SlabsOnline), a company incorporated in the Province of British Columbia, Canada.  SlabsOnline has been unsuccessful in the business of establishing a vertical trade portal on the Internet for the natural stone industry. Slabsdirect disposed of its interest in SlabsOnline to the former president of Slabsdirect pursuant to the stock purchase agreement dated December 29, 2004.  See Exhibit 10.2  Stock Purchase Agreement for more details.



CTT maintains its statutory registered agents office at 3511 Silverside Road, Suite 105, Wilmington, Delaware and its business office is located at 500 Mamaroneck Ave., Harrison, NY.  CTTs office telephone number is (914) 777-2090.



References in this Annual Report to CTT includes the Subsidiary, unless otherwise stated.



Subsequent Event

CTT entered into an Agreement and Plan of Merger (the Merger Agreement) dated April 16, 2007 with Reliablecom Acquisition Corp., a wholly-owned subsidiary of the Company incorporated on April 16, 2007 (Acquisition), Reliablecom, Inc. (Reliablecom), and Kapadia Holdings, Inc., the sole shareholder of Reliablecom (Holdings).  Pursuant to the terms of the Merger Agreement, Acquisition will merge with and into Reliablecom, which will become a wholly-owned subsidiary of the CTT (the Merger).  CTT will issue an aggregate of 14,625,000 post-dividend shares of common stock and 292,500 shares of series A Preferred stock (the Preferred Stock) to Holdings at the time of the closing of the merger. Each share of Preferred Stock will be convertible into 50 post-dividend shares of the Companys common stock, upon effectuation of an increase in CTTs authorized shares of common stock to 100,000,000 shares.

Upon execution of the Merger Agreement, CTTs former President Amit Sankhala (Sankhala) resigned as an officer and a member of the Board of Directors of CTT. Sankhala also agreed to the return and cancellation of 8,000,000 pre-dividend shares of CTTs common stock owned by him.

Prior to the closing of the Merger Agreement, CTT agreed to change its name to SK3 Group, Inc., and declare a two-for-one dividend on outstanding shares of common stock.

The closing of the Merger Agreement is subject to customary closing conditions. In the event the Merger Agreement has not closed by June 30, 2007, the Merger Agreement shall be terminated unless otherwise agreed to by the respective parties.







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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 5







On May 9, 2007, CTT, Reliablecom and Sohel Distributors Inc. (SDI), and Sohel Kapadia, the sole shareholder of SDI (Seller), entered into a Stock Purchase Agreement (the Purchase Agreement).  Pursuant to the terms of the Purchase Agreement, Reliablecom will acquire 100% of the issued and outstanding capital stock of SDI in exchange for (i) 85,000 shares of series A preferred stock of CTT (the Preferred Stock), and (ii) an earn-out of additional compensation for three years from the closing. The seller will receive 50% of the quarterly profits in excess of $37,500, together with 50% of the annual profits in excess of $150,000 plus the quarterly profit payments. The purchase price is subject to adjustment in the event the working capital of SDI is less than zero at closing. Each share of Preferred Stock has a liquidation preference of $0.01 and will be convertible into 50 post-dividend shares of the Companys common stock, upon effectuation of an increase in CTTs authorized shares of common stock to 100,000,000 shares.

Upon closing of the Purchase Agreement, CTT, Reliablecom and the Seller will enter into an Escrow and Lock-up Agreement, subject to various terms, and pursuant to which the Seller will place the Preferred Stock into escrow.

Upon closing of the Purchase Agreement, the Seller will enter into an employment agreement with SDI, pursuant to which the Seller will serve as President of SDI. For the first three years of the term of the employment agreement, the seller will be paid $150,000 per year. The agreement has a term of three years, and will automatically be renewed for additional one year terms unless terminated by either party at lease 90 days prior to expiration.

The closing of the Purchase Agreement is subject to customary closing conditions. The Purchase Agreement may be terminated prior to closing at the election of the Seller or Reliablecom, in the event the Purchase Agreement has not closed by June 30, 2007.



Business of CTT



CTT is in the e-commerce business and provides high-quality, non-branded computer and electronic merchandise at discount prices to the internet consumer through its website www.cheaperthanthem.com.  The website is hosted by Ezyra E-Business Services, an unrelated party, which charges CTT an annual fee of $372.36 to host the website.



Products and Services



CTT has a direct business, in which it buys and takes possession of excess electronic and computer inventory for resale (the Direct Business).  In addition, CTT has a fulfillment partner business, in which CTT facilitates the sale of merchandise of other retailers, cataloguers or manufacturers (collectively Fulfillment Associates) through the website (the Fulfillment Business).



For both the Direct Business and Fulfillment Business, CTT has developed a consumer and a wholesaler sales channel.  Therefore, CTTs business consists primarily of four combinations of these components: direct consumer, direct wholesaler, fulfillment business consumer and fulfillment business wholesaler.  Wholesale purchases make up over 80% of CTTs revenues to date.  Direct sales to consumers are 20%.  Retail goods are marked up by a margin of 50% and higher. Wholesale customers are charged 10-20% above cost depending on the volumes they order. There is no wholesaler agreement that CTT uses as sales are strictly volume based.  CTT currently serves four wholesale clients.



The security measures taken by CTT include only allowing the president of the CTT access to the confidential data and access to CTTs server via secured password.  Also, none of the confidential payment information is accessible via the Website as it is e-mailed or faxed directly to CTT, and it is kept in a locked cabinet, which only Mr. Sankhala has access to.   CTT does retain credit card information on the order forms for a period of six months, after which the information is shredded.



CTTs sales have come from the United States and Canada.  The majority of CTTs retail sales are from the United States off CTTs website.  The majority of the wholesale sales are in Canada.  Sales from the United States account for 25% and sales from Canada account for 75%.



CTT utilizes the Internet to create a more efficient market for liquidation computer and electronic merchandise.  CTTprovides consumers and businesses with quick and convenient access to high-quality, non-branded computer and electronic merchandise at discount prices.



CTTs objective is to leverage the Internet to become the dominant closeout solution for holders of non-branded computer and electronic merchandise.  CTT is pursuing this objective through the following key strategies:









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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 6





CTT intends to source its products from lower cost jurisdictions, primarily in Asia.

CTT offers a 30-day money back guarantee on all products. Customers pay for shipping on purchases and returns. If returned, the item is checked for damage and repackaged if sound.

Management believes that by utilizing targeted online campaigns such as banner ad and e-mail campaigns, the results of which CTT is able to quantify, it will be able to keep its per customer acquisition costs low.

Management believes it offers its wholesale customers a compelling opportunity for purchasing bulk inventory online at low prices with high-quality service.  Management believes that the small retail market is underserved by existing liquidators and it is working to take advantage of this significant opportunity.



Management believes that closeout electronic and computer merchandise is typically available in inconsistent quantities and prices and often is only available to consumers after it has been purchased and resold by disparate liquidation wholesalers.  Management believes that the traditional liquidation market for computer and electronic products is therefore characterized by fragmented supply and fragmented demand.  CTT is utilizing the Internet to aggregate both supply and demand and create a more efficient market for liquidation of electronic and computer merchandise.  Although CTT currently only offers MP3 players and MP3 accessories, it intends to expand its products to include other computer and electronic products after it has raised sufficient funds to do so. CTT cannot provide any guarantees of its ability to raise financing.



Direct Business



CTTs Direct Business involves buying and taking possession of inventory for resale.  CTT currently offers MP3 players and an FM transmitter accessory for MP3 players on the website.  CTT intends to become an online retailer offering various discount, non-branded electronic and computer merchandise for sale over the Internet.  CTT will offer its customers an opportunity to shop for bargains conveniently, while offering its suppliers an alternative inventory liquidation distribution channel.  CTT expects to add new, limited inventory products to the website in order to create an atmosphere that encourages customers to visit frequently and purchase products before its inventory sells out.



CTTs three suppliers are currently from Taiwan and China.  The Taiwanese suppliers have the factories in China.  CTT currently uses LTP Tech because they have an office in Richmond, British Columbia which is close to CTTs office.  CTT has other suppliers but has not elected to purchase from them until CTT has the demand for those products.  CTTs supply agreements are simply purchase orders to the supplier.  There are no contractual obligations, the higher the volume purchased, the lower CTTs costs.  CTT holds merchandise for usually 90 days.  CTT has the right to return defective merchandise within a one year period.  CTT does not offer any extended warranties on products.



Fulfillment Partner Business



CTT also has a Fulfillment Business where CTT sells merchandise of Fulfillment Associates through the website.  CTT manages the orders collected for the Fulfillment Associates through the website and forwards the orders on to the Fulfillment Associate, who then fills the order.  The Fulfillment Associates perform essentially the same operations as a warehouse: order picking and shipping.  From a customers point of view, shipping from CTT or from the warehouse of one of these Fulfillment Associates is indistinguishable.  CTT also utilizes a secured warehouse of one of its Fulfillment Associates located at Unit 110, 4471 - #6 Road, Richmond, British Columbia.



CTT currently has a business relationship with three Fulfillment Associates.  The three Fulfillment Associates are RJTech, Inc., LTP Tech and Shian Wang.  In the fulfillment component of its business, CTT does not physically handle the merchandise it sells for the Fulfillment Associates, as the merchandise was shipped directly by them.  The Fulfillment Associate also handles all customer returns.



Manufacturers and retailers traditionally hold inventory to buffer against uncertain demand within their normal, inline sales channels.  Inline sales channels are manufacturers primary distribution channels, which are characterized by regularly placed orders by established retailers at or near wholesale prices.  In recent years, several dynamics have shifted inventory risk from retailers to manufacturers, including:



dominant retailers insist on just-in-time deliveries from manufacturers;

dominant retailers often cancel orders mid-production and return unsold merchandise;

style, color, or model changes can quickly turn inventory into closeout merchandise;

incorrect estimates of consumer demand that can lead to overproduction; and

changes in a retailer financial situation or strategy results in cancelled orders.







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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 7







The disposal of excess, or overstock, inventory represents a substantial burden for many manufacturers.  Manufacturers seek to avoid liquidating through traditional retail channels where the manufacturers discounted products may be sold alongside other full-price products.  This can result in weaker pricing and decreased brand strength, and is known as channel conflict or sales channel pollution.  As a result, many manufacturers turn to liquidation wholesalers and discount retailers.  These liquidation channels provide manufacturers limited control of distribution and are, management believes, unreliable and expensive to manage when compared with their inline channels.



Fulfillment Business differs from Direct Business in that CTT remits payment to its Fulfillment Associates by company check on industry standard terms of 2% on 30 days.  Margins for the Fulfillment Business are lower than the Direct Business.



Distribution of Products and Services



When customers place orders on the website, orders are fulfilled either by a Fulfillment Associate or directly from CTTs suppliers warehouse located in Richmond, British Columbia.  CTTs merchandise is stored at CTTs suppliers secured warehouse, which is insured and secured.  They charge CTT $0.05 cents per unit for storage and insurance that they sell CTT.  This saves CTT the expense of storing the merchandise itself.  The $0.05 is built into the price of every unit CTT purchases.  The inventory is stored at the suppliers warehouse.  The cost is not segregated as it is merely a courtesy to CTT from the supplier.



CTT monitors both sources for accurate order fulfillment and timely shipment.  Through the website, orders are relayed to the warehouse management system throughout each day, and the warehouse management system in turn confirms to the shipment of each order.  CTT advertises a standard of shipping within two business days of order placement, but most orders ship within one business day.  As a general policy, CTT requires verification of receipt of payment or credit card authorization before it ships products to consumers or wholesale purchasers.  CTT currently charges $10.00 for basic ground shipping, but customers can choose from various expedited shipping services at their expense.  CTT offers a 30-day money back guarantee on all products.  Customers pay for shipping on both purchases and returns.  If returned, the item is checked for damage and repackaged if sound.  The manufacturer is responsible for all defective merchandise for one year.  Customers e-mail CTT and CTT responds as such.  CTT endeavors to respond within 5 business hours of receiving an e-mail from a customer.



Market



The primary and initial target market for CTTs products is currently males between the ages of 21 and 45, who desire the best quality electronic products for their entertainment.  These consumers tend to have a high level of product knowledge and usually know specifically what they are searching for.  Currently it is a challenge for them to access high-performance but inexpensive electronic products and components that are manufactured in Asia.



Secondly, once CTT has the capital to do so, CTT intends to also cater to the impulse purchaser by providing an entertaining website focusing on lifestyle fulfillment, not merely the fulfillment end of a warehouse type environment.



Thirdly, as a part of CTTs marketing plan and subject to the availability of capital, CTT intends to develop strategic Internet alliances with several companies that are offering e-engine software that will assist CTT in operating an online e-commerce site.  CTT is currently in the process of creating relationships with the webmasters of various strategic sites on the Internet in order to drive traffic and sales on the website.  These relationships may include reciprocal hyperlinks, banner ads or profiles on these sites.



Fourthly, CTT plans to target more Fulfillment Associates and create a business relationship with those Fulfillment Associates.  Despite the challenges encountered by manufacturers in the liquidation market, the proliferation of outlet malls, wholesale clubs and discount chains is evidence of the strong level of consumer demand for discount and closeout merchandise.  However, consumers face several difficulties in shopping for closeout and overstock merchandise.  For example, many traditional merchandise liquidation outlets are located in remote locations and have limited shopping hours, which management believes makes shopping burdensome and infrequent for many consumers.  In addition, the space available in a traditional merchandise liquidation outlet constrains the number of products that a traditional merchandise liquidation outlet can offer at any given time.









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However, management believes that the market for online liquidation is still early in its development and is characterized by only a large number of competitors, some of which utilize an auction model to price their goods.  Furthermore, management believes that there are no dominant companies in the online liquidation market, and many of the companies that do offer overstock or liquidation merchandise are focused on single product lines.



Lastly, small retailers are under competitive pressure from large national retailers.  Small retailers generally do not have purchasing leverage with manufacturers; consequently, they are more likely to pay full wholesale prices and are more likely to receive inferior service.  Management believes that small retailers generally do not have access to the liquidation market because liquidation wholesalers are most often interested in liquidating large volumes of merchandise, rather than the small quantities appropriate for small, local retailers.



Principal Suppliers



CTT is not dependent on any single supplier for its products.  CTTs products are supplied by a variety of manufactures, liquidation wholesalers, and Fulfillment Associates.  CTT currently utilizes three Fulfillment Associates because of choice and relationship to CTT and product mix.  The three Fulfillment Associates are RJTech, Inc., LTP Tech and Shian Wang.



CTT is not reliant on any one supplier. CTT sources its products from China and utilizes LTP Tech in North America as its only supplier.  CTT elects not to use other suppliers as LTP Tech is able to supply the products that CTT requires at this time and LTP Tech offers CTT the best price points.  CTT has dozens of other suppliers that it could utilize, if needed.



CTT has three manufacturer relationships and two liquidator relationships that it maintains.  There are no exclusivity contracts with any supplier or liquidator.  Suppliers tend to be external agents of electronic products, manufacturers are companies that CTT goes direct to for product cutting out the agents, and liquidators are usually those individuals who purchase excess stock and inventory at a steep discount to the retail and then liquidate that inventory to companies like CTT.  The manufacturers and liquidators are related to both CTTs wholesale and direct business.



Technology and Intellectual Property



CTT uses its internally developed website and uses the services of Telus Communications to obtain connectivity to the Internet.  CTT currently stores its data on an Access database cluster using Dell server system computer hardware.  Currently, CTT uses two Dell servers for the website, which are connected to its database.



CTT regards its domain name and similar intellectual property as critical to its success.  CTT relies on a combination of laws and contractual restrictions with its employees, customers, suppliers, affiliates and others to establish and protect its proprietary rights.  Despite these precautions, it may be possible for a third party to copy or otherwise obtain and use CTTs intellectual property without authorization.  In addition, CTT cannot assure you that others will not independently develop similar intellectual property.



From time to time, CTT may be subject to legal proceedings and claims in the ordinary course of its business, including claims of alleged infringement of the trademarks and other intellectual property rights of third parties by CTT.  These types of claims could result in increased costs of doing business through legal expenses, adverse judgments or settlements or require CTT to change its business practices in expensive ways.  In addition, litigation could result in interpretations of the law that require CTT to change its business practices or otherwise increase its costs.  Currently, CTT does not have any insurance coverage for any potential liabilities.  In the future, if it is affordable, CTT may obtain general liability insurance.



Also, third parties may recruit CTT employees who have had access to CTTs proprietary technologies, processes and operations. These recruiting efforts expose CTT to the risk that such employees will misappropriate CTT intellectual property.



Additional litigation may be necessary in the future to enforce CTTs intellectual property rights, to protect its trade secrets or to determine the validity and scope of the proprietary rights of others.  Any litigation, regardless of outcome or merit, could result in substantial costs and diversion of management and technical resources, any of which could materially harm CTTs business.









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Competition



CTTs products and services compete with other online retailers and traditional liquidation brokers, some of which may specifically adopt CTTs methods and target its customers.  CTT currently competes with a variety of companies that can be divided into several broad categories:



liquidation e-tailers such as Overstock.com;

online retailers with discount departments such as Amazon.com, Inc., eBay, Inc. and Buy.com, Inc.; and

traditional retailers and liquidators such as Sears Inc., Walmart Stores, Inc. and Best Buy Inc.



CTT also face potential competition from Internet companies not yet focused on the liquidation market, and from retail companies not yet operating online.  CTT is unable to anticipate which other companies are likely to offer services in the future that will compete with the services it provides.



In addition, many of CTTs current and potential competitors have greater brand recognition, longer operating histories, larger customer bases and significantly greater financial, marketing and other resources than CTT, and may enter into strategic or commercial relationships with larger, more established and well-financed companies.  Some of CTTs competitors could enter into exclusive distribution arrangements with CTT vendors and deny CTT access to their products, devote greater resources to marketing and promotional campaigns and devote substantially more resources to their web site and systems development than CTT.  New technologies and the continued enhancement of existing technologies also may increase competitive pressures on CTT.  CTT cannot assure you that it will be able to compete successfully against current and future competitors or address increased competitive pressures.



The online liquidation services market is new, rapidly evolving, intensely competitive and has relatively low barriers to entry, as new competitors can launch new web sites at relatively low cost.  CTT believe that competition in the online liquidation market is based predominantly on (1) price, (2), product quality and selection, (3) shopping convenience, and (4) customer service.



CTT provides manufacturers of electronic and computer products with a one-stop liquidation channel to sell both large and small quantities of excess and closeout inventory without disrupting sales through traditional channels.  Key advantages for manufacturers liquidating their excess inventory through CTT include:



Resolution of channel conflict.  Channel conflicts arise when a manufacturers excess inventory is sold through the same channel as their other product offerings. Since excess inventory is usually sold at a discount, sales of the manufacturers other product offerings may be impacted as a consumer in a retail store may opt for the excess product or become confused by the pricing and model discrepancies. By using CTT, management believes manufacturers have an alternative and independent channel where they can sell excess inventory without the fear of hindering the sale of their other products.

Single point of distribution.  Manufacturers often use multiple liquidation sources to clear their excess inventory. Multiple sources create additional logistics issues that they would rather avoid. By using CTT, manufacturers have a single source for the distribution of excess inventory.

Improved control of distribution.  By using CTT, manufacturers can monitor what kind of customer, whether individual consumer or small retailer, ultimately purchases their merchandise. In addition, a manufacturer can request that its products be offered in only one of its sales channels in order to avoid sales channel pollution.

Improved transaction experience.  By having a reliable inventory clearing channel, manufacturers are able to more quickly and easily dispense of their excess merchandise.



However, some key disadvantages for manufacturers liquidating their excess inventory through CTT include manufacturers may not want to work with CTT due to its limited operating history, resources and CTTs only officers lack of experience in the sector.



CTT also offers consumers a compelling alternative for bargain shopping.  Key advantages for consumers include convenient access on a secure site and responsive customer care.  CTT has developed a secure e-commerce site that has industry standard encryption, but has elected to use PayPal as a processor for credit cards for ease of transaction.  CTT also offers small businesses and retailers a compelling method for obtaining products for resale.  CTT believes that small businesses and retailers can secure lower prices and better service through CTT than they typically receive from manufacturers or other distributors.







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Management believes CTT is able to offer these advantages because, unlike many small businesses and retailers, CTT will have the ability to access the liquidation market to buy merchandise in bulk quantities for which it often receives volume-based price discounts provided CTT has sufficient working capital to make these types of acquisitions.  Accordingly, CTT has designed it shipping and receiving operations with the flexibility to accommodate both the receipt of large shipments of inventory purchases, and the distribution of bulk loads to its small business customers.  CTT receives all shipments to its Fulfillment Associate and manufacturer in Richmond, British Columbia.  As stated, this supplier has secured warehouse facilities and as such CTT has no logistical issues.  CTTs products are small in size and as such 100 units can fit into a four square foot box.  The largest order that CTT received and shipped to date was its FM receiver line where 500 units were received and 400 units were shipped.



Regulations



CTT is subject to general business regulations and laws, as well as regulations and laws specifically governing the Internet and e-commerce.  Currently, other than business and operations licenses applicable to most commercial ventures and the standard consumer protection laws, CTT is not required to comply with any extraordinary regulations for its business operations.  As a result of doing business through the Internet in many jurisdictions, CTT must comply with many laws and regulations that deal with taxation, advertising, consumer protection, user privacy, data protection, pricing, content, copyrights, distribution, electronic contracts and other communications, broadband residential Internet access, and the characteristics and quality of products and services.



CTT is subject to the same federal, state and local laws as other companies conducting business on the Internet.  Today there are relatively few laws specifically directed towards conducting business on the Internet.  However, due to the increasing popularity and use of the Internet, many laws and regulations relating to the Internet are being debated at the state and federal levels.  These laws and regulations could cover issues such as user privacy, freedom of expression, pricing, fraud, quality of products and services, taxation, advertising, intellectual property rights and information security. Applicability to the Internet of existing laws governing issues such as property ownership, copyrights and other intellectual property issues, taxation, libel, obscenity and personal privacy could also harm CTTs business.  For example, United States and foreign laws regulate CTTs ability to use customer information and to develop, buy and sell mailing lists.  The vast majority of these laws was adopted prior to the advent of the Internet, and do not contemplate or address the unique issues raised thereby. T hose laws that do reference the Internet, such as the Digital Millennium Copyright Act and the CAN-SPAM Act of 2003, are only beginning to be interpreted by the courts and their applicability and reach are therefore uncertain.  These current and future laws and regulations could harm CTTs business, results of operation and financial condition.



However, there can be no assurance that current or new laws or regulations will not, in the future, impose additional fees and taxes on CTT and its business operations.  Any new laws or regulations relating to the Internet or any new interpretations of existing laws could have a negative impact on CTTs business and add additional costs to CTTs business operations.



Currently, CTT only operates in British Columbia and has no nexus to any State.  Accordingly, CTT is not required to collect or remit any tax on its transactions with consumers, with the exception of the 7% sales tax charged to British Columbia consumers and the 7% goods and service tax charged to consumers residing in Canada.



Websites are not currently subject to direct federal laws or regulations applicable to access, content or commerce on the Internet.  However, due to the increasing popularity and use of the Internet, it is possible that a number of laws and regulations may be adopted with respect to the Internet covering issues such as:



 user privacy

 freedom of expression

 pricing

 content and quality of products and services

 taxation

 advertising

 intellectual property rights

 information security









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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 11





The adoption of any such laws or regulations might decrease the rate of growth of Internet use, which in turn could decrease the demand for CTTs products and services, increase the cost of doing business, or in some other manner have a negative impact on CTTs business, financial condition and operating results.  In addition, applicability to the Internet of existing laws governing issues such as property ownership, copyrights and other intellectual property issues, taxation, libel, obscenity and personal privacy is uncertain.  The vast majority of such laws were adopted prior to the advent of the Internet and related technologies and, as a result, do not contemplate or address the unique issues of the Internet and related technologies.



Additionally, in response to concerns regarding spam (unsolicited electronic messages), pop-up web pages and other Internet advertising, the federal government and a number of states have adopted or proposed laws and regulations that would limit the use of unsolicited Internet advertisements.  While a number of factors may prevent the effectiveness of such laws and regulations, the cumulative effect may be to limit the attractiveness of effecting sales on the Internet, thus reducing the value of CTTs business operations.  Currently, CTT does not spam and there are no laws or regulations governing Internet advertising that have a negative impact on CTTs business.



Also, several telecommunications companies have petitioned the Federal Communications Commission to regulate Internet service providers and on-line service providers in a manner similar to long distance telephone carriers and to impose access fees on those companies.  This could increase the cost of transmitting data over the Internet.



Finally, CTT has adopted a code of ethics (the Code) that is applicable to every officer, director, employee and consultant of the company and its affiliates.  The Code reaffirms the high standards of business conduct required of all employees.  The Code is part of CTTs continuing efforts to (1) ensure that it complies with all applicable laws, (2) have an effective program in place to prevent and detect violations of law, and (3) educate and train its employees to be aware and understand ethical business practices.  In most circumstances, the Code sets standards that are higher than the law requires.



Employees and Employment Agreements



Currently, CTT has no employees and CTT does not intend to hire third party independent contractors to provide services to CTT.  Mr. Sankhala, the sole officer and director until April 16, 2007, was responsible for all the business operations of CTT.  Such duties are now handled by Sajid Kapadia, whose duties included website maintenance, all corporate governance, order processing and shipping, and all other business tasks related to the products and to CTT.  Mr. Sankhala resigned on April 16, 2007 and Sajid Kapadia was appointed sole officer of CTT.



At present, CTTs sole officer does not have an employment agreement with CTT.  CTT presently does not have pension, health, annuity, insurance, stock options, profit sharing or similar benefit plans; however, CTT may adopt plans in the future.  There are presently no personal benefits available to any employees.



CTT has also adopted eight corporate values to provide a framework for all employees in conducting themselves in their jobs.  These values are not intended to substitute for the Code, but will serve as guidelines in helping the employees to conduct CTTs business in accordance with the Code.



The Code is not intended to cover every possible situation in which an employee may find himself or herself.  It is meant to give each employee the boundaries within which CTT expects each employee to conduct himself or herself while representing CTT.  An employee may find himself or herself in a situation where there is no clear guidance given by the Code.  If that occurs, return to the objective stated below: common sense, good judgment, high ethical standards and integrity, and refer to CTTs values.  In addition, there are many resources upon which an employee may rely, including the president.



RISK FACTORS



You should consider each of the following risk factors and the other information in this Annual Report, including CTTs financial statements and the related notes, in evaluating CTTs business and prospects.  The risks and uncertainties described below are not the only ones that impact on our business.  Additional risks and uncertainties not presently known to CTT or that CTT currently considers immaterial may also impair its business operations.  If any of the following risks actually occur, CTTs business and financial results could be harmed. In that case, the trading price of CTTs common stock could decline.









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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 12





Risks associated with CTT:



1.

CTT is a development stage company and may not be able to continue as a going concern and may not be able to raise additional financing.



A note provided by CTTs independent auditors in CTTs financial statements for the period from inception, May 17, 2004, through December 31, 2006 contains an explanatory note that indicates that CTT is a development stage company and its ability to continue as a going concern and to emerge from the development stage is dependent on continued financial support from its shareholders, raising additional capital to fund future operations and ultimately to attain profitable operations.



CTT has a working capital deficiency and has accumulated losses since inception. These factors raise substantial doubt about CTTs ability to continue as a going concern.  To date there has been no significant revenue. In a development stage company, management devotes most of its activities to developing a market for its products and services. These consolidated financial statements have been prepared on a going concern basis, which implies that CTT will continue to realize its assets and discharge its liabilities in the normal course of business.  CTT has not generated significant revenue and has never paid any dividends. CTT is unlikely to pay dividends or generate significant earnings in the immediate or foreseeable future. There is no guarantee that CTT will be able to raise any equity financing or generate profitable operations. CTT has a working capital deficit of $91,220 and has accumulated losses of $195,923 since inception. These factors raise substantial doubt regarding CTTs ability to continue as a going concern.



This note may make it more difficult for CTT to raise additional equity or debt financing needed to run its business and is not viewed favorably by analysts or investors.  CTT urges potential investors to review this report before making a decision to invest in CTT.



2.

CTT lacks an operating history and has losses that it expects to continue into the future. If the losses continue CTT will have to suspend operations or cease operations.



CTT has had no significant operating history upon which an evaluation of its future success or failure can be made.  CTTs net loss since its inception on May 17, 2004 is $195,923.  CTTs ability to achieve and maintain profitability and positive cash flow is dependent upon its ability to generate revenues from its planned business operations and to reduce development costs.  Without the generation of any revenues or any capital being raised in an equity or debt financing, CTT will run out of operating funds within four months.



Based upon current plans, CTT expects to incur $3,000 per month in operating losses in the next 12 to 18 months.  This will happen because there are expenses associated with the development and operation of its website.  CTT cannot guaranty that it will be successful in generating revenues in the future or that it will be able to raise any working capital for operating funds in the future.  Failure to generate revenues or raise any financing may cause CTT to go out of business.



3.

CTT is relatively new to the internet marketplace with no history of operations and, as a result, CTTs ability to operate and compete effectively may be affected negatively.



In deciding whether to purchase CTTs shares of common stock, and the likelihood CTTs success, you should consider that CTT is relatively new to the internet marketplace and has no operating history upon which to judge its current operations.  As a result, you will be unable to assess CTTs future operating performance or its future financial results or condition by comparing these criteria against its past or present equivalents.



Also, the computer and Internet industries are characterized by rapidly changing technologies, frequent introductions of new products, services, and industry standards.  CTTs future success will depend on its continued ability to adapt to rapidly changing technologies by continually improving the performance features and reliability of CTTs services, as well as, the development and maintenance of the Internets infrastructure to cope with this increased traffic.  CTTs future success will also depend in large part on its continued ability to develop and enhance CTTs products and services.  There are significant technical risks in the development of new or enhanced services, including the risk that CTT will be unable to effectively use new technologies, adapt its services to emerging industry standards, or develop, introduce and market new or enhanced products and services.







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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 13





Also, if CTT is unable to develop and introduce enhanced or new products and services quickly enough to respond to market or user requirements or to comply with emerging industry standards, or if these products and services do not achieve market acceptance, CTT may not be able to compete effectively.



4.

CTT does not have sufficient funds to complete each phase of its proposed plan of operation and as a result may have to suspend operations.



Each of the phases of CTTs plan of operation is limited and restricted by the amount of working capital that CTT has and is able to raise from financings and generate from business operations.  CTT currently does not have sufficient funds to complete each phase of its proposed plan of operation and CTT expects that it will not satisfy its cash requirements for the next 12 months.  As a result, CTT may have to suspend or cease its operations on one or more phases of the proposed plan of operation.



As of December 31, 2006, CTT had $16,928 in cash.  Until CTT is able to generate any consistent and significant revenue it will be required to raise additional funds by way of equity financing to finance its operations.  At any phase of CTTs plan of operation, if CTT finds that it does not have adequate funds to complete a phase, it may have to suspend its operations and attempt to raise more money so it can proceed with its business operations.  If CTT cannot raise the capital to proceed it may have to suspend operations until it has sufficient capital.



CTT will also require additional financing if the costs of the proposed phases of the plan of operation are greater than anticipated. CTT will require additional financing to sustain its business operations if CTT is not successful in earning revenues from its business operations.  CTT can provide no assurance to investors that CTT will be able to find additional financing if required.  Any sale of additional share capital will result in dilution to existing shareholders.



5.

Since CTTs management lacks any formal training or experience in operating an e-commerce business, CTT may have to hire or retain qualified personnel.  If CTT is unable to hire or retain any qualified personnel, CTT may have to suspend or cease operations, which will result in the loss of your investment.



CTTs sole officer, Sajid Kapadia, is inexperienced in operating an e-commerce business, CTT may be forced to hire or retain qualified management, employees or consultants to perform administrative, sales or marketing roles related to an e-commerce business.  Mr. Kapadia has no direct training or experience in these areas and as a result may not be fully aware of all of the specific requirements related to working within this industry.  Mr. Kapadia s decisions and choices may not take into account standard managerial approaches e-commerce companies commonly use.  Consequently, CTTs operations, earnings, and ultimate financial success could suffer irreparable harm due to managements lack of experience in this industry.  As a result, CTT may have to suspend or cease operations that will result in the loss of your investment.



Competition for qualified personnel is intense and CTT may not be able to hire or retain qualified personnel, which could also have a negative impact on CTTs business.







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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 14







6.

CTT has no independent board members, which places them in a conflict of interest with respect to compliance with CTTs Code of Ethics.



There is no independent director and no other compliance officer or employee to oversee compliance of CTTs Code of Ethics.  As a result, a conflict of interest when it comes to overseeing compliance and enforcement of CTTs Code of Ethics.  The Code of Ethics is part of CTTs continuing efforts to (1) ensure that it complies with all applicable laws, (2) have an effective program in place to prevent and detect violations of law, and (3) educate and train its Employees to be aware and understand ethical business practices.  As Mr. Sankhala is the sole compliance officer, he would be conflicted if he had to investigate himself if any operation or activity that involved CTT, and as a result Mr. Sankhala as the sole officer and director of CTT, was in violation of the law or of the Code of Ethics.  Such reportable violations include insider trading, non-compliance with financial reporting and record keeping requirements, failure to communicate accurate and timely information, failure to keep information confidential, failure to ensure the health and safety of CTTs employees, a conflict of interest for personal gain at the expense of CTT, failure to compete fairly, and non-compliance with all state, federal, or international regulations.  Violations of the law or the Code of Ethics could subject CTT to severe penalties and fines, which could negatively impact on CTTs financial position and business



7.

Because Mr. Sankhala owns more than 50% of the outstanding shares, he will be able to decide who will be elected to the board of directors and you may not be able to elect any board member, which may lead to the entrenchment of management, and will also be able to impede or effect a change of control or a sale of assets.



Amit Sankhala, CTTs director currently owns an aggregate 6,634,168 shares (70.6%) and has voting control of CTT.  Holders of CTTs shares of common stock do not have cumulative voting rights, which means that the holders of more than 50% of the outstanding shares, voting for the election of members of the board of directors, can elect all of the members to be elected, if they so choose, and, in that event, the holders of the remaining shares will not be able to elect any of member to CTTs board of directors.  As a result, Mr. Sankhala will be able to set the number of directors to be elected and to elect all of the members of CTTs board of directors, to control CTTs business operations, and to entrench management.



Also, as a result of Mr. Sankhala having voting control of CTT, Mr. Sankhala has the ability to approve or defeat a change of voting control of CTT and to approve or reject any offer for the purchase and sale of CTTs assets.



CTT is also afforded the protections of Section 203 of the Delaware General Corporation Law, which could delay or prevent a change in control of CTT or could impede a merger, consolidation, takeover or other business combination involving CTT or discourage a potential acquirer from making a tender offer or otherwise attempting to obtain control of CTT.



8.

CTT does not expect to pay dividends in the foreseeable future.



CTT has never paid cash dividends on its shares of common stock and has no plans to do so in the foreseeable future.  CTT intends to retain earnings, if any, to develop and expand its business operations.



9.

CTTs director owns a substantial amount of CTTs shares of common stock: if he were to sell his shares in the public market within a short period of time, the price of CTTs shares of common stock could drop significantly.



Amit Sankhala, a director of CTT, currently owns 6,634,168 shares of common stock, which represent 70.6% of the 9,397,101 issued and outstanding shares of common stock of CTT.  Mr. Sankhala may sell large amounts of common stock into the public market over relatively short periods of time subject to Rule 144.  Any sale of a substantial amount of CTTs common stock in the public market by Mr. Sankhala may adversely affect the market price of CTTs common stock.  Such sales could create public perception of difficulties or problems with CTTs business and may depress CTTs stock price.







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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 15







10.

A change in control of CTT can be delayed, impeded or effected by the director of CTT, who owns 70.6% of the outstanding shares.



CTTs director owns 6,634,168 shares of common stock and as a result have the ability to influence the vote for a change of voting control of CTT or the vote to approve or reject any offer for the purchase and sale of CTTs assets.



11.

Penny Stock rules may make buying or selling CTTs shares of common stock difficult, and severely limit the market and liquidity of the shares of common stock.



Trading in CTTs shares of common stock is subject to certain regulations adopted by the SEC commonly known as the penny stock rules.  These rules govern how broker-dealers can deal with their clients and penny stocks.  The additional burdens imposed upon broker-dealers by the penny stock rules may discourage broker-dealers from effecting transactions in CTTs securities, which could severely limit their market price and liquidity of CTTs securities.  See Penny Stock Rules below on page 19 for more information.



Risks associated with CTT business:



12.

Failure to successfully compete in the e-commerce industry with established e-commerce companies may result in CTTs inability to continue with its business operations.



Currently, there is significant competition in this market.  CTT expects competition in this market to increase significantly as traditional liquidators and online retailers continue to develop services that compete with CTTs services and there are a few barriers to entry in this market.  In addition, competitors may decide to create their own websites to sell their own excess inventory and the excess inventory of third parties.



Many of CTTs current competitors have longer operating histories, larger customer bases, greater brand recognition and significantly greater financial, marketing and other resources than CTT does.  Some of CTTs competitors may be able to secure merchandise from suppliers on more favorable terms, devote greater resources to marketing and promotional campaigns, adopt more aggressive pricing or inventory availability policies, and devote substantially more resources to their website and systems development than CTT does.  Increased competition may result in reduced operating margins, loss of market share and a diminished brand franchise.  CTT cannot assure you that we will be able to compete successfully against current and future competitors.



If CTT is unable to develop and introduce enhanced or new technology or services quickly enough to respond to market or user requirements or to comply with emerging industry standards, or if these services do not achieve market acceptance, CTT may not be able to compete effectively.  Competitive pressures created by any one of CTTs competitors could have a negative impact on CTTs business, results of operations and financial condition and as a result, CTT may not be able to continue with its business operations.



13.

Since CTT relies on one provider to host its website, CTTs technical systems could fail if this service is interrupted, which in turn would have a negative impact on CTTs business.



Although CTT has back up facilities for its computer systems, CTT relies on one provider to host the website, Ezyra E-Business Services.  If Ezyra E-Business Services failed to provide service to its systems, CTT would be unable to maintain website availability.  Interruptions could result from natural disasters as well as power loss, telecommunications failure and similar events.   CTTs business depends on the efficient and uninterrupted operation of its computer and communications hardware systems.  Any system interruptions that cause its website to be unavailable could materially adversely affect its business.  Furthermore, CTT will be depending on outside expertise to maintain and expand its website design and capabilities.  There is no assurance that website consultants can be retained who will understand the needs of and have the solution for a desirable, user-friendly commercial website.







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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 16







14.

CTT relies on one supplier for its Direct Business and on three Fulfillment Associates for its Fulfillment Business for a majority of its inventory.



CTT currently sources its entire inventory for its Direct Business from one supplier, LTP Tech.  Also, CTT sources a majority of its inventory for its Fulfillment Business from three Fulfillment Associates.  CTT does not have long-term contracts or arrangements with its supplier or Fulfillment Associates to guarantee the availability of inventory.  If CTTs current supplier and Fulfillment Associates were to stop supplying inventory to CTT on acceptable terms, CTT may not be able to acquire inventory from other suppliers in a timely and efficient manner and on acceptable terms.  CTTs accounts payable are due 30 days after receipt of the invoice.



15.

CTTs business exposes CTT to potential product liability claims, and CTT may incur substantial expenses if CTT is subject to product liability claims or litigation, which could result in a negative impact on its business.



CTTs products involve a minimal inherent risk of product liability claims and associated adverse publicity.  However, CTT may be held liable if any product it sells causes injury or is otherwise found unsuitable.  Currently, CTT does not carry any product liability insurance or general business coverage.  A product liability claim, regardless of its merit or eventual outcome, could result in significant legal defense costs.  These costs would have the effect of increasing CTTs expenses and diverting managements attention away from the operation of its business, and could harm CTTs business.



16.

CTT may be subject to legal proceedings involving its intellectual property that could result in substantial costs and which could materially harm CTTs business operations.



From time to time, CTT may be subject to legal proceedings and claims in the ordinary course of its business, including claims of alleged infringement of the trademarks and other intellectual property rights of third parties by CTT.  These types of claims could result in increased costs of doing business through legal expenses, adverse judgments or settlements or require CTT to change its business practices in expensive ways.  Additional litigation may be necessary in the future to enforce CTTs intellectual property rights, to protect its trade secrets or to determine the validity and scope of the proprietary rights of others.  Any litigation, regardless of outcome or merit, could result in substantial costs and diversion of management and technical resources, any of which could materially harm CTTs business.



Risks associated with CTTs industry:



17.

Any new laws or regulations relating to the Internet or any new interpretations of existing laws could have a negative impact on CTTs business.



Currently, other than business and operations licenses applicable to most commercial ventures, CTT is not required to obtain any governmental approval for its business operations.  However, there can be no assurance that current or new laws or regulations will not, in the future, impose additional fees and taxes on CTT and its business operations.  Additionally, in response to concerns regarding spam (unsolicited electronic messages), pop-up web pages and other Internet advertising, the federal government and a number of states have adopted or proposed laws and regulations that would limit the use of unsolicited Internet advertisements.  While a number of factors may prevent the effectiveness of such laws and regulations, the cumulative effect may be to limit the attractiveness of effecting sales on the Internet, thus reducing the value of CTTs business operations.  Also, several telecommunications companies have petitioned the Federal Communications Commission to regulate Internet service providers and on-line service providers in a manner similar to long distance telephone carriers and to impose access fees on those companies.  This could increase the cost of transmitting data over the Internet.  Any new laws or regulations relating to the Internet or any new interpretations of existing laws could have a negative impact on CTTs business and add additional costs to CTTs business operations.







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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 17







18.

CTT may be subject to liability for past sales, which could have a negative impact on CTTs future business operations.



In accordance with current industry practice, CTT does not currently collect sales or other similar taxes for physical shipments of inventory into the United States.  One or more local, state or foreign jurisdictions may seek to impose sales tax collection obligations on CTT and other out-of-state companies that engage in online commerce.  CTTs business could be adversely affected if one or more States or any foreign country successfully asserts that CTT should collect sales or other taxes on the sale of its inventory.  Currently, decisions of the U.S. Supreme Court restrict the imposition of obligations to collect state and local sales and use taxes with respect to sales made over the Internet.  However, a number of States, as well as the U.S. Congress, have been considering various initiatives that could limit or supersede the Supreme Courts position regarding sales and use taxes on Internet sales.  If any of these initiatives addressed the Supreme Courts constitutional concerns and resulted in a reversal of its current position, CTT could be required to collect sales and use taxes in certain or all States.  The imposition by state and local governments of various taxes upon Internet commerce could create administrative burdens for CTT and could decrease its future sales and have a negative impact on CTTs future business operations.



19.

CTT is subject to regulations relating to consumer privacy and data protection, which may adversely affect the growth of CTTs Internet business or its marketing efforts.



CTT is subject to increasing regulation at the federal, state and international levels relating to privacy and the use of personal user information.  For example, CTT is subject to various telemarketing laws that regulate the manner in which CTT may solicit future suppliers and customers.  Such regulations, along with increased governmental or private enforcement, may increase the cost of growing CTTs business.



In addition, several States have proposed, and California, Minnesota, Utah, and Vermont have recently passed, legislation that would limit the uses of personal user information gathered online or require online services to establish privacy policies.  In addition to these four States, many other jurisdictions already have such laws and continuously consider strengthening them, especially against online services. CTT in certain instances are subject to some of these current laws.



The Federal Trade Commission has adopted regulations regarding the collection and use of personal identifying information obtained from children under 13.  Bills proposed in Congress would extend online privacy protections to adults.  Moreover, proposed legislation in this country and existing laws in foreign countries require companies to establish procedures to notify users of privacy and security policies, obtain consent from users for collection and use of personal information, and/or provide users with the ability to access, correct and delete personal information stored by CTT.  CTT could become a party to a similar enforcement proceeding.  These data protection regulations and enforcement efforts may restrict CTTs ability to collect demographic and personal information from users, which could be costly or harm CTTs marketing efforts.



Specific statutes intended to protect user privacy have been passed in many non-U.S. jurisdictions, including virtually every non-U.S. jurisdiction in which CTT currently offers its products.  Failure to comply could subject CTT to lawsuits, fines, criminal penalties, statutory damages, adverse publicity, and other losses that could harm our business.  Changes to existing laws or the passage of new laws intended to address these privacy and data protection and retention issues could directly affect the way CTT does business or could create uncertainty on the Internet.  This could reduce demand for CTTs inventory, increase the cost of doing business as a result of litigation costs or increased inventory or delivery costs, or otherwise harm CTTs business.







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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 18







20.

Security of online transactions via the Internet and any security breaches will have a negative impact on CTTs business.



The secure transmission of confidential information over public telecommunications facilities is a significant barrier to electronic commerce and communications on the Internet.  CTT retains all pertinent data about a customer, including name, payment information, address, what they purchased, and credit card information.  Many factors may cause compromises or breaches of security systems used by CTT and other Internet sites to protect proprietary information.  A compromise of security on the Internet would materially negatively affect the use of the Internet for commerce and communications.  This in turn would negatively affect CTTs business.  Circumvention of CTTs security measures could result in misappropriation of its proprietary information or cause interruptions of CTTs operations.  Protecting against the threat of such security breaches may require CTT to expend significant amounts of capital and other resources.  There can be no assurance that CTTs security measures will prevent security breaches.  Currently, CTT has no security features in place on its website, with the exception that CTT utilizes PayPal as a processor for credit cards.



CTT does not carry insurance against the risk of credit card fraud, so the failure to adequately control fraudulent credit card transactions could reduce CTTs net revenues and its gross margin.  CTT may in the future suffer losses as a result of orders placed with fraudulent credit card data even though the associated financial institution approved payment of the orders.  If CTT is unable to detect or control credit card fraud, CTTs liability for these transactions could negatively impact CTTs business.  To date, CTT has not been assessed any fines for chargebacks in the past, but chargebacks may arise in the future.  CTT has taken measures to detect and reduce the risk of fraud, but these measures may not be effective.  If these measures do not succeed, CTTs business will suffer.



21.

CTTs business will be adversely affected if the infrastructure of the Internet is unable to support demands placed on it by CTTs business.



The success of commercial use of the Internet depends in large part upon the development and maintenance of the Internet  s infrastructure, including the development of complementary products such as various broadband technologies.  The number of users of the Internet and the amount of traffic on the Internet have grown significantly and are expected to continue to grow, placing greater demands on the Internet's infrastructure.  This infrastructure may not be able to support the demands placed on it by this continued growth without its performance or reliability being decreased.  Any outages or delays in services could lower the level of Internet usage.  In addition, the infrastructure and complementary products and services necessary to make the Internet a viable commercial marketplace may not develop.  If usage of the Internet is curtailed due to infrastructure constraints or lack of complementary products, CTT expects an adverse impact on its business and revenues.  Even if such infrastructure and complementary products and services do develop, there can be no guarantee that the Internet will become a viable commercial marketplace for products and services such as those offered by CTT.



Item 2.

Description of Property.



CTTs primary asset is its 100% interest in CTT Distributors Ltd.  CTT Distributors Ltd.s assets consist of its domain name www.cheaperthanthem.com, its website, and the inventory it has in stock at this time.



CTT operates from its principal office located at 500 Mamaroneck Ave., Harrison, NY.    CTT also utilizes a secured warehouse of one of its Fulfillment Associates located at Unit 110, 4471 - #6 Road, Richmond, British Columbia on a rent free basis.  For allowing CTT to use the space in the warehouse for its products, CTT pays the supplier $0.05 per each unit that is sold from the warehouse.   The $0.05 is built into the price of every unit CTT purchases.  The inventory is stored at the suppliers warehouse.  The cost is not segregated as it is merely a courtesy to CTT from the supplier.  LTP Tech owns the space where CTT stores its inventory.  CTT is currently in compliance with Section 9 regarding insurance coverage, as the primary tenants insurance provides blanket coverage for CTT.



Item 3.

Legal Proceedings.



CTT is not a party to any pending legal proceedings and, to the best of CTTs knowledge, none of CTTs property or assets are the subject of any pending legal proceedings.







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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 19





Item 4.

Submission of Matters to a Vote of Security Holders.



No matter was submitted to a vote of security holders, through the solicitation of proxies or otherwise, during the fourth quarter of the fiscal year covered by this report.



PART II



Item 5.

Market for Common Equity and Related Stockholder Matters.



(a)

Market Information



CTTs shares of common stock have been quoted on the NASD OTC Bulletin Board since January 17, 2007 under the symbol CTND. The shares have not traded to date and consequently, no prices are provided.



(b)

Holders of Record



CTT has 50 registered holders of common stock.



(c)

Dividends



CTT has declared no dividends on its common stock in fiscal 2006.  CTT has no current plans to declare or pay any cash dividend on its common stock.



(d)

Recent Sales of Unregistered Securities



In the past three fiscal years, CTT has sold the following securities that were not registered under the Securities Act of 1933.



On December 29, 2004, CTT issued 455,001 shares of common stock to the shareholders of the subsidiary for the acquisition of all of the outstanding shares of CTT Distributors Ltd. pursuant to the terms of the share exchange agreement.  CTT relied upon Rule 903 of Regulation S for the applicable exemption to issue the unregistered shares.  No offer was made or accepted in the United States and the share certificates representing the shares have been legended with the applicable trading restrictions.



The list of shareholders, the number of shares exchanged and the number of shares received are listed in the following table:



|                   |                  |                            |                
|------------------ | ---------------- | -------------------------- | ---------------
|Shareholders       | Shares Exchanged | Percentage of Total Shares | Shares Received
|Jessika Prasad     | 35,000           | 7.69%                      | 35,000         
|Michael Shevchenko | 23,000           | 5.05%                      | 23,000         
|Jagdeep Bhathal    | 20,000           | 4.40%                      | 20,000         
|Nicholas Brown     | 25,000           | 5.49%                      | 25,000         
|Taryn Enns         | 12,000           | 2.64%                      | 12,000         
|Tom Novis          | 13,000           | 2.86%                      | 13,000         
|Lynne Enns         | 9,000            | 1.98%                      | 9,000          
|Roy Enns           | 9,000            | 1.98%                      | 9,000          







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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 20







|                |         |         |        
|--------------- | ------- | ------- | -------
|Kate MacLean    | 10,000  | 2.20%   | 10,000 
|Susan Novis     | 17,000  | 3.74%   | 17,000 
|Richard Novis   | 100,000 | 21.98%  | 100,000
|Gordon Moreland | 17,000  | 3.74%   | 17,000 
|Harry Joa       | 80,000  | 17.58%  | 80,000 
|Kerri Enns      | 19,000  | 4.18%   | 19,000 
|Ali Hussain     | 26,000  | 5.71%   | 26,000 
|Abid Shah       | 18,000  | 3.96%   | 18,000 
|Cyrus Kashani   | 22,000  | 4.84%   | 22,000 
|Amit Sankhala   | 1       | 0.00%   | 1      
|Totals          | 455,001 | 100.00% | 455,001



On July 13, 2005, the board of directors authorized the issuance of up to 1,000,000 shares of common stock at an offering price of $0.10 per share. The offering price was arbitrarily set by CTT and had no relationship to its assets, book value, revenues or other established criteria of value.  All the restricted shares issued in this offering were issued for investment purposes in a private transaction.



On July 13, 2005, CTT raised $70,000 in cash from this offering and issued an aggregate 700,000 restricted shares to the subscribers as listed below.  This offering was closed in September 2005.



| |                    |                 |              
| | ------------------ | --------------- | -------------
| | Name of Subscriber | Number of Units | Consideration
| | Anna Liza Aman     | 150,000         | $15,000      
| | Angelito Dela Cruz | 120,000         | $12,000      
| | Emirita Hernandez  | 125,000         | $12,500      
| | Annabelle Layugan  | 150,000         | $15,000      
| | Ria Reyes          | 155,000         | $15,500      
| | Total              | 700,000         | $70,000      



CTT relied upon Rule 903 of Regulation S promulgated pursuant to that Act by the Securities and Exchange Commission.  Management is satisfied that the requirements of the exemption from the registration and prospectus delivery requirements of the Securities Act of 1933 have been fully complied with.  The offering was not a public offering and was not accompanied by any general advertisement or any general solicitation.  CTT received from each subscriber a completed and signed subscription agreement containing certain representations and warranties, including, among others, that (a) the subscriber was not a U.S. person, (b) the subscriber subscribed for the shares for their own investment account and not on behalf of a U.S. person, and (c) there was no prearrangement for the sale of the shares with any buyer.  No offer was made or accepted in the United States and the share certificates representing the shares have been legended with the applicable trading restrictions.



On June 29, 2006, the Securities and Exchange Commission declared CTTs Form SB-2 Registration Statement effective, file number 333-124286, permitting CTT to offer up to 2,500,000 shares of common stock at $0.10 per share. There was no underwriter involved in CTTs public offering.  On November 28, 2006, CTT sold 380,000 shares of common stock in the public offering and raised $38,000 from this offering and no fees or commissions were paid.  The net proceeds were used for working capital.  CTT did not sell any other shares under this public offering.  The offering period for the public offering expired on December 29, 2006.









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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 21





(e)

Penny Stock Rules



Trading in CTTs common stock is subject to the penny stock rules. The SEC has adopted regulations that generally define a penny stock to be any equity security that has a market price of less than $5.00 per share, subject to certain exceptions. These rules require that any broker-dealer who recommends CTTs common stock to persons other than prior customers and accredited investors, must, prior to the sale, make a special written suitability determination for the purchaser and receive the purchasers written agreement to execute the transaction. Unless an exception is available, the regulations require the delivery, prior to any transaction involving a penny stock, of a disclosure schedule explaining the penny stock market and the risks associated with trading in the penny stock market. In addition, broker-dealers must disclose commissions payable to both the broker-dealer and the registered representative and current quotations for the securities they offer. The additional burdens imposed upon broker-dealers by such requirements may discourage broker-dealers from effecting transactions in CTTs common stock, which could severely limit their market price and liquidity of CTTs common stock.



The penny stock rules also imposes additional sales practice requirements on broker/dealers who sell penny stock. These rules require a one page summary of certain essential items. The items include the risk of investing in penny stocks in both public offerings and secondary marketing; terms important to in understanding of the function of the penny stock market, such as bid and offer quotes, a dealers spread and broker/dealer compensation; the broker/dealer compensation, the broker/dealers duties to its customers, including the disclosures required by any other penny stock disclosure rules; the customers rights and remedies in causes of fraud in penny stock transactions; and, the NASDs toll free telephone number and the central number of the North American Administrators Association, for information on the disciplinary history of broker/dealers and their associated persons.



Item 6.

Managements Discussion and Analysis.



THE FOLLOWING PRESENTATION OF MANAGEMENTS DISCUSSION AND ANALYSIS OF CTT INTERNATIONAL DISTRIBUTORS INC. SHOULD BE READ IN CONJUNCTION WITH THE AUDITED FINANCIAL STATEMENTS AND OTHER FINANCIAL INFORMATION INCLUDED HEREIN.



Overview



CTT is a start-up, development stage company and has not generated any significant revenues from its e-commerce business operations.



CTT was incorporated under the laws of the State of Delaware on January 14, 2000 as Slabsdirect.com, Inc.  On January 7, 2005, the former sole director and officer of CTT resigned and the current sole director and officer, Amit Sankhala was appointed.  Until January 7, 2005, Slabsdirect.com, Inc. was an online auction marketplace for natural stone products, equipment and related items with no operations, no revenues, no financial backing and few assets.  On January 7, 2005, CTT merged with Slabsdirect.com, Inc. and became the parent company to CTT Distributors Ltd.



On December 29, 2004, Slabsdirect.com, Inc. agreed to issue 455,001 shares of common stock in exchange for all of the issued and outstanding shares of common stock of CTT Distributors Ltd.  See Exhibit 10.1  Share Exchange Agreement for more details.  The acquisition was considered a reverse acquisition for accounting and financial reporting purposes.  The consolidated financial statements include the accounts of CTT since the reverse merger (December 29, 2004) and the historical accounts of CTT Distributors Ltd. since the date of its inception, May 17, 2004.  All significant intercompany balances and transfers have been eliminated in consolidation.



Prior to the acquisition of CTT Distributors Ltd., Slabdirect.com, Inc.s sole asset consisted of ownership of a 100% interest in the issued and outstanding capital stock of Slabsdirect.com Online (BC) Ltd., a company incorporated in the Province of British Columbia, Canada.  SlabsOnline has been unsuccessful in the business of establishing a vertical trade portal on the Internet for the natural stone industry.  CTT disposed of its interest in Slabsdirect.com Online (BC) Ltd. to the former president of Slabsdirect.com, Inc. pursuant to the stock purchase agreement dated December 29, 2004.  See Exhibit 10.2  Stock Purchase Agreement for more details.



During the fiscal year ended December 31, 2006, CTT focused its efforts on the e-commerce operations of its business, including the development of the website and its strategic alliances for marketing.









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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 22





During the next 12 months, CTT has no current plan to (1) buy any specific additional plant or equipment, (2) conduct any significant research or development activities, or (3) to hire any employees, other than what will be required as part of CTTs plan of operation.  See Plan of Operation below for more information.  Other than as described in this section, CTT has no other financing plans.



Financial Condition



CTT is a development stage company and CTTs ability to continue as a going concern is dependent on raising additional capital to fund future operations and ultimately to attain profitable operations.  This means that CTTs auditors believe there is substantial doubt that CTT can continue as an on-going business for the next twelve months unless CTT obtains additional capital to pay its bills.  CTTs auditors report on its 2006 financial statements contained an explanatory paragraph that states that due to recurring losses since inception and negative cash flows substantial doubt exists as to CTTs ability to continue as a going concern.  Accordingly, CTTs financial statements contained in this annual report have been prepared on a going concern basis, which assumes that CTT will be able to realize its assets and discharge its obligations in the normal course of business.  CTT incurred net losses for the period from inception of May 17, 2004 to December 31, 2006 of $195,923.



CTT had net loss of $66,287 during the year ended December 31, 2006.  As of December 31, 2006, CTT had a cash balance of $16,928, accounts receivable of $936, and prepaid expenses of $429.  When these current assets were offset against CTTs current liabilities of $109,513, in accounts payable of $37,793, in accrued liabilities of $290, and in a note payable of $49,736, CTT was left with a working capital deficit of $91,220 at December 31, 2006.



CTT had net loss of $76,753 during the year ended December 31, 2005.  As of December 31, 2005, CTT had a cash balance of $14,061, accounts receivable of $7,213, prepaid expenses of $429, and inventory of $2,527.  When these current assets were offset against CTTs current liabilities of $81,246, in accounts payable of $32,685, in accrued liabilities of $28,131, and in a note payable of $8,736, CTT was left with a working capital deficit of $57,016 at December 31, 2005.



CTTs financial statements included in this annual report have been prepared without any adjustments that would be necessary if CTT becomes unable to continue as a going concern and would therefore be required to realize upon its assets and discharge its liabilities in other than the normal course of its business operations.



Limited operating history; need for additional capital



There is no historical financial information about CTT upon which to base an evaluation of its performance as an e-commerce company.  CTT is an e-commerce company but has not generated any significant revenues from its e-commerce business.  CTT cannot guarantee it will be successful in the e-commerce industry.  CTTs business is subject to risks inherent in the establishment of a new business enterprise, including limited working capital, possible delays in the development of its products and services, and possible cost overruns due to price and cost increases in products and services.



CTT has adopted a phased plan of operation to the development of the website and its operations.  See Plan of Operation below for more detail.  This allows CTT to allocate the expenditures of its resources in a very timely and measured manner.  CTT will not continue with expenditures in any phase of the development if Amit Sankhala thinks CTT will be unable to complete the designated task.  CTT may require further equity financing to provide for some of the working capital required to implement future development of the website and operations beyond the final phase of the plan of operation or for services and products that are currently not anticipated to be developed.



To meet its need for cash, CTT will rely on any revenues generated from its business operations and on equity financings.  Any revenue and financings will be applied to (1) development of CTTs website www.cheaperthanthem.com and implementation of CTTs plan of operation, (2) development and delivery of its products and services, (3) operation of its business, (4) repayment of debt, and (5) working capital.  Management does not know for certain how long CTT can satisfy its cash requirements.  Management believes that CTT can satisfy its cash needs for until June 2006 based upon its receivables and inventory on hand.  As well, with the payment terms that CTT has with its suppliers, it can purchase most inventory on 60 day terms.  CTT keeps its costs down by paying Amit Sankhala a salary and keeping its operating expenses low.









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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 23





If CTT requires additional proceeds, CTT will have to find alternative sources, like a public offering, a private placement of securities, or loans from its sole officer or others.  CTT has no assurance that future equity financing will be available to it on acceptable terms.  If financing is not available on satisfactory terms, CTT may be unable to continue, develop or expand its e-commerce operations.  Equity financing could result in additional dilution to existing shareholders. At the present time, CTT has not made any arrangements to raise additional cash.



If CTT is unable to complete any phase of its plan of operation because it does not have enough money, CTT will suspend business operations until CTT raises additional working capital.  If CTT cannot raise the required working capital, CTT will either have to suspend operations until it does raise the required working capital, or cease operations entirely. If CTT ceases business operations, CTT does not know what it will do and does not have any plans to do anything else.  At that time, if it is in the best interest of CTT and its shareholders, management will consider liquidation.



Comparison of the Fiscal Years Ended December 31, 2006 and 2005



Results of Operation



While CTT is currently generating some revenue, CTT does not anticipate earning significant revenues until it completes Phase 2 of its plan of operation.  However, there is no assurance that CTT will be able to complete its plan of operation and management does not know when CTTs business operations will generate significant revenues.  There is no guaranty that CTT will generate revenues from the website, or that if CTT does complete Phase 2 of its plan of operation, that CTTs business operations will generate significant revenues or that CTT will be able to secure the financing necessary to proceed with the other phases of its plan of operations.



For the year ended December 31, 2006, CTT had net loss of $66,287, which was a decrease of $10,466 from CTTs net loss of $76,753 for year ended December 31, 2005.  The decrease in net loss for the year ended December 31, 2006, as compared to the year ended December 31, 2005, was primarily due to a decrease in professional fees.



Revenues



Total revenue for the year ended December 31, 2006 was $936 compared to $30,462 for the year ended December 31, 2005.  During 2006, CTT commenced its business operations and went live with its website.  Management expects revenues to increase from CTTs business operations.



CTT has generated revenues of $62,367 from operations since its inception and has no long-term commitments or contingencies.  For the fiscal year ended December 31, 2006, CTT realized the following sales:



| |              |                 |                       |                     
| | ------------ | --------------- | --------------------- | --------------------
| | Unit Type    | Number of Units | Average Selling Price | Average Gross Margin
| | FM Receivers | 33              | $13.00                | 42%                 
| | MP3 Players  | 37              | $148.61               | 41%                 



For the fiscal year ended December 31, 2005, CTT realized the following sales:



| |              |                 |                       |                     
| | ------------ | --------------- | --------------------- | --------------------
| | Unit Type    | Number of Units | Average Selling Price | Average Gross Margin
| | FM Receivers | 1,760           | $14.24                | 42%                 
| | MP3 Players  | 35              | $133.32               | 41%                 



There is no real reason for the rate of decline on sales of FM receivers other than the lack of customer demand on the website.  The average gross margins on the sale of receivers remained consistent over the past two years.









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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 24





The breakdown of CTTs sales between its Direct Business and its Fulfillment Business is 100% and nil respectively.  Inventory is kept low as CTTs suppliers have inventory on hand.  CTTs purchases inventory on an as needed basis to fill orders.  Management will monitor the demand and supply for inventory to ensure that there is sufficient inventory with CTTs supply channels to meet demands.  If CTT is unable to provide the inventory and meet demands, it will place mark the product as out of stock on the website.  To date, CTT has not made any fulfillment sales.



As a general policy, CTT requires verification of receipt of payment or credit card authorization before it ships products to consumers or wholesale purchasers.  CTT has two types of customers that it deals with, one being retail which are internet customers and one being wholesale which are customers that call up the Company and the Company has had past relationships with.  The verification process is for the retail (internet sales) with either credit cards or certified cheques.  The wholesale customers are relationships from the past and are given extended credit.  Once payment is verified for retail customers, the shipment is shipped.  At December 31, 2005 the average days outstanding was 86 days and at December 31 2006 the average number of days had increased to 270 days.  The increase in days outstanding is due to CTT collecting its outstanding accounts receivable balances on a less timely basis.  There is definitely a direct correlation between the outstanding accounts and CTTs liquidity.  CTT will be less able to turn its cash around to purchase inventory so it potentially decreases CTTs profitability



Operating Expenses



Total operating expenses decreased to $64,149 for the year ended December 31, 2006, from $90,202 for the year ended December 31, 2005, due primarily to increases in consulting fees of $7,553 and in general and administrative of $360, and to decreases in advertising and marketing of $83, in donated services of $1,247, and in professional fees of $32,636.  CTTs expenses decreased because CTT decreased its business operations and its investing and financing activities.  Management expects CTTs operating expenses to continue to increase as CTT increases its business operations and its investing and financing activities.



For the fiscal year ended December 31, 2006, CTT realized $936 in sales of its products.  The concurrent cost of sales was $3,074, resulting in negative gross profit from operations of $2,138.  CTTs cost of sales consists solely of inventory costs.  During the same period, CTT incurred (a) general administrative expenses of $9,891, which included $3,222 for general and office expenses and $6,669 for rent; (b) professional fees of $34,368, which included legal fees of $11,768, accounting fees of $9,450 for preparation of the financial statements, and auditors fees of $13,150 (d) consulting fees of $13,265; (e) donated services of $6,000, representing the fair value of services provided by Amit Sankhala, the former president, of which Mr. Sankhala does not expect repayment; and (f) amortization of $625 for the accumulated amortization on the website.  Therefore, for the fiscal period ending December 31, 2006 CTT had total net loss of $66,287.



For the fiscal year ended December 31, 2005, CTT realized $30,462 in sales of its products.  The concurrent cost of sales was $17,193, resulting in gross profit from operations of $13,449.  CTTs cost of sales consists solely of inventory costs.  During the same period, CTT incurred (a) advertising and marketing expenses of $83; (b) general administrative expenses of $9,531, which included $3,790 for rent; (c) professional fees of $66,665, which included legal fees of $43,065, accounting fees of $10,150 for preparation of the financial statements, and auditors fees of $13,450 (d) consulting fees of $5,712; (e) donated services of $7,247, representing the fair value of services provided by Amit Sankhala, of which Mr. Sankhala does not expect repayment; and (f) amortization of $625 for the accumulated amortization on the website.  Therefore, for the fiscal period ending December 31, 2005 CTT had total net loss of $76,753.



Management believes that CTTs software development costs are non-recurring.  The software development costs are non-recurring because CTT is just amending the website.  By investing $110,000, CTT will be enhancing its online marketing strategy and potentially changing the architecture of the website, the programming language etc.  This feeds into CTTs comment that by developing new technology service offerings CTT will be able to attract new customers and offer a better product to its consumers.



CTT has not attained profitable operations and is dependent upon obtaining financing to continue and to expand its existing business operations and to complete its plan of operation.  For these reasons, CTTs auditors stated in their report that they have substantial doubt that CTT will be able to continue as a going concern.









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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 25





Off-Balance Sheet Arrangements



CTT has no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on CTTs financial condition, changes in financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors, nor does CTT have any non-consolidated, special-purpose entities.



Liquidity and Capital Resources



CTTs capital resources have been limited.  CTT currently does not generate significant revenue from its business operations to be profitable, and to date has primarily relied on the sale of equity for working capital for its business operations.



CTT had cash of $16,928 and a working capital deficit of $91,220 at December 31, 2006.  During the fiscal year ended December 31, 2006 CTT funded its operations through revenues from CTTs business operations of $936 and the private placement of 380,000 shares of common stock for which CTT received cash of $38,000 and related party advances of $56,000.



The notes to CTTs consolidated financial statements as of December 31, 2006 contain footnote disclosure regarding CTTs uncertain ability to continue as a going concern.  CTT has not generated sufficient revenues to cover its expenses, and CTT has an accumulated deficit of $230,205.  While management believes that CTT will begin to generate more revenue during the year, as of December 31, 2006, CTT had $109,513 in current liabilities and CTT cannot assure that it will succeed in generating revenue sufficient to meet its ongoing cash needs.



While CTT has raised capital to meet its working capital and financing needs in the past, additional financing is required in order to fully complete its plan of operation and continue with its business operations.  CTT is seeking financing in the form of equity in order to provide the necessary working capital, but currently has no commitments for financing.  There are no assurances CTT will be successful in raising the funds required and there can be no assurances that CTT can obtain financing on terms reasonably acceptable to it or at all.  The lack of capital may force CTT to suspend its business operations.



Management believes that CTTs existing capital resources will be sufficient to fund its current level of operating activities, capital expenditures and other obligations through the next three months, except any required working capital for its plan of operation.  Even though CTTs monthly burn was $7,490 in the fiscal year ended December 31, 2006, CTT had sufficient financing that would lead management to believe that CTT has three months of working capital available.  However, if during that period or thereafter, CTT is not successful in generating sufficient liquidity from operations or in raising sufficient capital resources, on terms acceptable to the CTT, this could have a material adverse effect on CTTs business, results of operations, liquidity and financial condition.



Below is a discussion of CTTs sources and uses of funds for the year ended December 31, 2006.



Net Cash Used in Operating Activities



CTT had cash of $16,928 and a working capital deficit of $91,220 at December 31, 2006.  During the fiscal year ended December 31, 2006, CTT used $73,591 in cash for operating activities.  This was primarily a result of an operating loss of $66,287, offset by non-cash items for amortization ($625) and donated services ($6,000), and a net decrease in operating assets and liabilities of $13,929.  During the fiscal year ended December 31, 2006, CTT paid $22,733 towards accounts payable, which was offset by a decrease in accounts receivable of $6,277 representing the collection of outstanding amounts.  The large decrease in accounts payable was primarily a result of payment of legal fees during the period ended December 31, 2006, which were accrued during the period ended December 31, 2005.  The decrease in accounts receivable resulted from sales generated during the period ended December 31, 2006, which were collected during the fiscal year ended December 31, 2006.  CTT also received $51,000 as short term loans from the president of CTT that is non-interest bearing and payable on demand.  There were also minor changes in prepaid expenses, inventory and due to related parties resulting in a net use of cash of $2,527.



Net Cash Used in Financing Activities



CTT generated $76,458 from financing activities during the fiscal year ended December 31, 2006 from the receipt of subscription proceeds related to 380,000 shares of common stock at $0.10 per share, net of stock offering costs of $12,542.  CTT has no contingencies or long-term commitments.









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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 26





Net Cash Used in Investing Activities



During the fiscal year ended December 31, 2006, CTT did not incur any change in cash flows from investing activities.



Contingencies and Commitments



CTT does not currently have any commitments for material capital expenditures over the short or long term.  CTT expects to incur $3,000 per month in operating losses in the next 12 to 18 months, largely due to expenses associated with the development and operation of the website but also due to operating costs during that same time period.  CTTs monthly operating costs include CDN$600 for rent of CTTs principal office, CDN$43 for Internet services and access, and $500 for miscellaneous office expenses.



Critical Accounting Policies



CTTs discussion and analysis of its financial condition and results of operations, including the discussion on liquidity and capital resources, are based upon its 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 judgements that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities.  Actual results could differ from those estimates. On an on going basis, management re-evaluates its estimates and judgments, including but not limited to, those related to revenue recognition and collectibility of accounts receivable.  Critical accounting policies identified are as follows:



Revenue Recognition



CTT recognizes revenue from the sale of electronic products, such as MP3 players, in accordance with Securities and Exchange Commission Staff Accounting Bulletin No. 104 (SAB 104), Revenue Recognition in Financial Statements. Revenue consists of the sale of electronic products and is recognized only when the price is fixed or determinable, persuasive evidence of an arrangement exists, the product is shipped, and collectibility is reasonably assured.  Trade accounts receivable relate to the sale of electronic products, such as MP3 players.  Amit Sankhala regularly reviews the collectibility of any outstanding balance, together with his estimate of the credit worthiness of the client.  CTT sells to customers based on standard credit policies and regularly reviews accounts receivable for any bad debts.  Allowances for doubtful accounts are based on estimate of losses on customer receivable balances.  As at December 31, 2006 there was no allowance for doubtful accounts.



Foreign Currency Transaction/ Balances



CTTs functional and reporting currency is the United States dollar.  Monetary assets and liabilities denominated in foreign currencies are translated in accordance with SFAS No. 52 Foreign Currency Translation, using the exchange rate prevailing at the balance sheet date.  Gains and losses arising on translation or settlement of foreign currency denominated transactions or balances are included in the determination of income.  Foreign currency transactions are primarily undertaken in Canadian dollars.  CTT has not entered into derivative instruments to offset the impact of foreign currency fluctuations.



Website Development Costs



CTT recognizes the costs associated with developing a website in accordance with the American Institute of Certified Public Accountants (AICPA) Statement of Position (SOP) No. 98-1, Accounting for the Costs of Computer Software Developed or Obtained for Internal Use.  Relating to website development costs CTT follows the guidance pursuant to the Emerging Issues Task Force (EITF) No. 00-2, Accounting for Website Development Costs.



Going Concern Issue



The going concern basis of presentation assumes CTT will continue in operation throughout the next fiscal year and into the foreseeable future and will be able to realize its assets and discharge its liabilities and commitments in the normal course of business. Certain conditions, discussed below, currently exist that raise substantial doubt upon the validity of this assumption.  The financial statements d o not include any adjustments that might result from the outcome of the uncertainty.







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|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 27





CTTs future business activities are dependent upon its ability to obtain third party financing in the form of debt and equity and ultimately to generate future profitable e-commerce activity or revenue from its product and services.  As of December 31, 2006, CTT has only generated $62,367 in revenues since inception, and has experienced negative cash flow from its e-commerce activities.  CTT may look to secure additional funds through future debt or equity financings.  Such financings may not be available or may not be available on reasonable terms.



Internal and External Sources of Liquidity



CTT has funded its operations principally from the issuance of common stock, borrowings in the form of advances payable, and a short-term note payable.



Inflation



CTT does not believe that inflation will have a material impact on CTTs future business operations.



Plan of Operations for the Next Twelve Months



CTT has not had any significant revenues generated from its business operations since inception.



CTT may not be able to satisfy its working capital requirements for the next 12 months.  Accordingly, CTT will need to raise additional working capital to continue its operations.  CTT anticipates funding its working capital needs for the next 12 months through the equity capital markets and private financings.  Although the foregoing actions are expected to cover CTTs anticipated cash needs for working capital and capital expenditures for at least the next 12 months, no assurance can be given that CTT will be able to raise sufficient cash to meet these cash requirements.



Also, CTT expects revenues generated from the website to contribute to CTTs required working capital, but expects that the revenues generated from the website for the next 12 months will not be enough for its required working capital.  Until CTT is able to generate any consistent and significant revenue it may be required to raise additional funds by way of equity.



CTT plans to improve CTTs cash flows and operating results by raising additional capital through a registered offering, private placements of stock, and private loans. Therefore, CTT has not contemplated any plan of liquidation if it does not generate revenues.  CTT cannot ensure, however, that these plans will be successful.



At any phase, if CTT finds that it does not have adequate funds to complete a phase, it may have to suspend its operations and attempt to raise more money so it can proceed with its business operations.  If CTT cannot raise the capital to proceed it may have to suspend operations until it has sufficient capital.



To become profitable and competitive, CTT needs to establish its website as a comprehensive on-line shopping mall.  To achieve this goal, CTT has prepared a plan of operation for the next 12 months.  Each of the phases of the plan of operations listed below will be implemented as resources are available.



Phase 1 - Develop and populate website (3 months)



In Phase 1, CTT plans to (1) upgrade and update the website so that it is more visually appealing and technologically sound and (2) update its product line and visuals on the website.  CTT has budgeted $50,000 for this phase and expects it to take three months to complete, with completion expected within the first three months of CTTs plan of operation.  This budget includes the cost of a fully functional, e-commerce enabled format and the costs associated with installation and technicians.  Also in this phase, CTT will continue to maintain and populate the website with new products and updated visuals.



Phase 2 - Expand inventory and products (6 months)



In Phase 2, CTT plans to expand its product line to include inventory and products as the new products become available from suppliers and Fulfillment Associates.  CTT will allocate 25% of this phases budget to the purchase of new and existing merchandise.









---

|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 28





CTTs expansion goals in this phase are to (1) expand its inventory product line by 12 new inventory products, (2) expand its business by offering products directly applicable to its retail model, and (3) to expand its inventory of products to provide a 15  100% gross margin.  CTT has a 100% margin on some of its MP3 products.  As the cost of components drops to the manufacturer, especially flash memory, those costs are passed on to CTT.  Management believes that as CTT sources directly from manufacturers, it will increase its margins as the cost of components decrease.



CTT has budgeted $75,000 for this phase and expects it to take six months to complete, with completion expected within the first six months of CTTs plan of operation.



Phase 3- Implement marketing strategy (6 months)



In Phase 3, CTT plans to (1) hire personnel for sales, marketing and customer service, (2) create a marketing strategy for the website and its products, and (3) implement its marketing strategy on its target market, including international customers.



CTTs marketing goals in this phase are to attract potential and repeat customers to the website and have customers perceive the website as a preferred source of non-branded, discount products that are delivered in a professional, authoritative and efficient manner.



CTT has budgeted $75,000 for this phase and expects it to take six months to complete with completion expected within the second six months of CTTs plan of operation.



Phase 4- Corporate Development (4 months)



In Phase 4, CTT plans to expand its business operations by creating products directly applicable to the non-branded, discounted product market.  CTT intends to create products that are copies of the products that mainstream producers like Apple, Sony and Samsung produce.  Create means to develop a product that has similar functionality and style, yet does not and will not infringe on anyones intellectual property.  CTT currently has no in house manufacturing.  CTT will identify a trend in electronics being sold by companies such as the Apple iPod or Sony MP3 players and work with the manufacturer to create similar looking and functioning products.



CTT has budgeted $50,000 for this phase and expects it to take four months to complete, with completion expected within the final four months of CTTs plan of operation.



During any phase of the plan of operation, if CTT does not have adequate working capital to complete a phase of its proposed plan of operation, CTT may have to suspend its business operations and attempt to raise more working capital so that CTT can proceed.  If CTT cannot raise the necessary working capital to proceed CTT may have to cease business operations until there is sufficient working capital.



CTT anticipates continuing to rely on private loans, equity sales of common shares, or debt financing in order to fund its proposed plan of operation.  The issuance of additional shares will result in dilution to existing shareholders of CTT.



CTT is not currently conducting any research and development activities other than the development of the website.  It does not anticipate conducting such activities in the near future.  As CTT expands its customer base and product lines, it will need to hire additional employees or independent contractors as well as purchase or lease additional equipment.



Uncertainties Relating to Forward-Looking Statements



This Form 10-KSB Annual Report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  You can identify these statements by managements use of words such as plan, expect, aim, believe, project, anticipate, intend, estimate, will, should, could and other expressions that indicate future events and trends.  All statements that address expectations or projections about the future, including statements about CTTs plan of operations and raising capital from external sources are forward-looking statements.









---

|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 29





Managements discussion and analysis of CTTs financial condition and the results of its operations and other sections of this report contain forward looking statements that are based upon the current beliefs and expectations of management, as well as assumptions made by, and information currently available to, management.  Because these statements involve risks and uncertainties, actual actions and strategies and the timing and expected results may differ materially from those expressed or implied by the forward-looking statements.  As well, CTTs future results, performance or achievements could differ materially from those expressed in, or implied by, any forward-looking statements due to a number of uncertainties including, but not limited to, those discussed in this section.  Factors that could cause CTTs future results to differ from these expectations include general economic conditions, particularly as they affect CTTs business operations and its ability to raise sufficient working capital.  As a result, the identification and interpretation of data and other information and their use in developing and selecting assumptions from and among reasonable alternatives requires the exercise of judgment.  To the extent that the assumed events do not occur, CTTs outcome may vary substantially from its anticipated or projected results, and accordingly, CTT expresses no opinion on the achievability of those forward-looking statements and gives no assurance that any of the assumptions relating to the forward-looking statements are accurate.



All forward-looking statements are made as of the date of filing of this Form 10-KSB and CTT disclaims any duty to update these statements.



CTT may, from time to time, make oral forward-looking statements.  CTT strongly advises you to read the foregoing paragraphs and the risk factors described in this annual report and in CTTs other documents filed with the United States Securities and Exchange Commission for a description of certain factors that could cause CTTs actual results to differ materially from those in the oral forward-looking statements.  CTT disclaims any intention or obligation to update or revise any oral or written forward-looking statements whether as a result of new information, future events or otherwise.







---

|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 30





Item 7.

Financial Statements



CTT International Distributors Inc.

(A Development Stage Company)

December 31, 2006

|                                                           
|-----------------------------------------------------------
|                                                           
|Index                                                      
|                                                           
|                                                           
|Report of Independent Registered Public Accounting Firm
F1
|                                                           
|Consolidated Balance Sheets
F2                            
|                                                           
|Consolidated Statements of Operations
F3                  
|                                                           
|Consolidated Statements of Cash Flows
F4                  
|                                                           
|Consolidated Statements of Stockholders Deficit
F5       
|                                                           
|Notes to the Consolidated Financial Statements
F6         























---

|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 31







[cttintl10ksbmay11002.gif]







Report of Independent Registered Accounting Firm



To the Stockholders and Board of Directors

of CTT International Distributors Inc.

(A Development Stage Company)



We have audited the accompanying consolidated balance sheets of CTT International Distributors Inc. (A Development Stage Company) as of December 31, 2006 and 2005 and the related consolidated statements of operations, cash flows and stockholders deficit for the years then ended and accumulated for the period from May 17, 2004 (Date of Inception) to December 31, 2006. These consolidated financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.



We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits 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 audits provide a reasonable basis for our opinion.



In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of CTT International Distributors Inc. (A Development Stage Company) as of December 31, 2006 and 2005, and the results of its operations and cash flows for the years then ended and accumulated for the period from May 17, 2004 (Date of Inception) to December 31, 2006, in conformity with generally accepted accounting principles used in the United States of America.



The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has a working capital deficiency and has accumulated losses since inception. These factors raise substantial doubt about the Companys ability to continue as a going concern. Managements plans in regard to these matters are also discussed in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.



/s/ MANNING ELLIOTT LLP



CHARTERED ACCOUNTANTS

Vancouver, Canada

March 30, 2007, except as to Note 8 which is as of May 9, 2007





F-1









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|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 32





CTT International Distributors Inc.

(A Development Stage Company)

Consolidated Balance Sheets

(Expressed in US dollars)





|                                                                                                                                                   |                   |                  
|-------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------- | -----------------
|                                                                                                                                                   | December 31,
2006 | December 31,
2005
|                                                                                                                                                   | $                 | $                
|                                                                                                                                                   |                   |                  
|ASSETS                                                                                                                                             |                   |                  
|                                                                                                                                                   |                   |                  
|Current Assets                                                                                                                                     |                   |                  
|                                                                                                                                                   |                   |                  
|Cash                                                                                                                                               | 16,928            | 14,061           
|Accounts receivable                                                                                                                                | 936               | 7,213            
|Inventory                                                                                                                                          |                  | 2,527            
|Prepaid expenses                                                                                                                                   | 429               | 429              
|                                                                                                                                                   |                   |                  
|Total Current Assets                                                                                                                               | 18,293            | 24,230           
|                                                                                                                                                   |                   |                  
|Intangible Assets (Note 3)                                                                                                                         | 937               | 1,562            
|                                                                                                                                                   |                   |                  
|Total Assets                                                                                                                                       | 19,230            | 25,792           
|                                                                                                                                                   |                   |                  
|                                                                                                                                                   |                   |                  
|LIABILITIES AND STOCKHOLDERS DEFICIT                                                                                                              |                   |                  
|                                                                                                                                                   |                   |                  
|Current Liabilities                                                                                                                                |                   |                  
|                                                                                                                                                   |                   |                  
|Accounts payable                                                                                                                                   | 37,793            | 32,685           
|Accrued liabilities                                                                                                                                | 290               | 28,131           
|Due to related party (Note 4)                                                                                                                      | 71,430            | 20,430           
|                                                                                                                                                   |                   |                  
|Total Liabilities                                                                                                                                  | 109,513           | 81,246           
|                                                                                                                                                   |                   |                  
|Contingencies and Commitments (Notes 1 and 5)                                                                                                      |                   |                  
|                                                                                                                                                   |                   |                  
|Stockholders Deficit                                                                                                                              |                   |                  
|                                                                                                                                                   |                   |                  
|Preferred Stock
Authorized: 5,000,000 preferred shares with a par value of $0.0001
Issued and outstanding: none                                    |                  |                 
|                                                                                                                                                   |                   |                  
|Common Stock
Authorized: 30,000,000 common shares with a par value of $0.0001
Issued and outstanding: 11,397,101 shares (2005  11,017,101 shares) | 1,140             | 1,102            
|                                                                                                                                                   |                   |                  
|Additional Paid in Capital                                                                                                                         | 122,035           | 96,615           
|                                                                                                                                                   |                   |                  
|Donated Capital                                                                                                                                    | 16,747            | 10,747           
|                                                                                                                                                   |                   |                  
|Deficit Accumulated During the Development Stage                                                                                                   | (230,205)         | (163,918)        
|                                                                                                                                                   |                   |                  
|Total Stockholders Deficit                                                                                                                        | (90,283)          | (55,454)         
|                                                                                                                                                   |                   |                  
|Total Liabilities and Stockholders Deficit                                                                                                        | 19,230            | 25,792           
|                                                                                                                                                   |                   |                  





(The accompanying notes are an integral part of these consolidated financial statements)

F2







---

|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 33





CTT International Distributors Inc.

(A Development Stage Company)

Consolidated Statements of Operations

(Expressed in US dollars)





|                                    |                                                      |                    |                   
|----------------------------------- | ---------------------------------------------------- | ------------------ | ------------------
|                                    | Accumulated
from
May 17, 2004
(Date of Inception) to | For the
Year Ended | For the
Year Ended
|                                    | December 31,                                         | December 31,       | December 31,      
|                                    | 2006                                                 | 2006               | 2005              
|                                    | $                                                    | $                  | $                 
|                                    |                                                      |                    |                   
|                                    |                                                      |                    |                   
|Revenue                             | 62,367                                               | 936                | 30,462            
|                                    |                                                      |                    |                   
|Cost of Sales                       | (48,103)                                             | (3,074)            | (17,193)          
|                                    |                                                      |                    |                   
|Gross Profit                        | 14,264                                               | (2,138)            | 13,449            
|                                    |                                                      |                    |                   
|                                    |                                                      |                    |                   
|Expenses                            |                                                      |                    |                   
|                                    |                                                      |                    |                   
|Advertising & marketing             | 5,820                                                |                   | 83                
|Amortization                        | 1,562                                                | 625                | 625               
|Consulting                          | 21,266                                               | 13,265             | 5,712             
|Donated services                    | 16,747                                               | 6,000              | 7,247             
|General and administrative          | 24,228                                               | 9,891              | 9,531             
|Professional fees                   | 122,823                                              | 34,368             | 67,004            
|                                    |                                                      |                    |                   
|Total Expenses                      | 192,446                                              | 64,149             | 90,202            
|                                    |                                                      |                    |                   
|Loss from Operations                | (178,182)                                            | (66,287)           | (76,753)          
|                                    |                                                      |                    |                   
|Loss on disposal of subsidiary      | (17,741)                                             |                   |                  
|                                    |                                                      |                    |                   
|Net Loss                            | (195,923)                                            | (66,287)           | (76,753)          
|                                    |                                                      |                    |                   
|                                    |                                                      |                    |                   
|Loss Per Share  Basic and Diluted  |                                                      | (0.01)             | (0.01)            
|                                    |                                                      |                    |                   
|                                    |                                                      |                    |                   
|Weighted Average Shares Outstanding |                                                      | 11,045,000         | 10,486,000        
|                                    |                                                      |                    |                   





(The accompanying notes are an integral part of these consolidated financial statements)

F3







---

|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 34





CTT International Distributors Inc.

(A Development Stage Company)

Consolidated Statements of Cash Flows

(Expressed in US dollars)





|                                                                           |                                                      |                    |                    
|-------------------------------------------------------------------------- | ---------------------------------------------------- | ------------------ | -------------------
|                                                                           | Accumulated
from
May 17, 2004
(Date of Inception) to | For the
Year Ended | For the
Year  Ended
|                                                                           | December 31,                                         | December 31,       | December 31,       
|                                                                           | 2006                                                 | 2006               | 2005               
|                                                                           | $                                                    | $                  | $                  
|                                                                           |                                                      |                    |                    
|                                                                           |                                                      |                    |                    
|Operating Activities                                                       |                                                      |                    |                    
|                                                                           |                                                      |                    |                    
|Net loss for the year                                                      | (195,923)                                            | (66,287)           | (76,753)           
|                                                                           |                                                      |                    |                    
|Adjustments to reconcile net loss to net cash used in operating activities |                                                      |                    |                    
|Amortization                                                               | 1,562                                                | 625                | 625                
|Donated services                                                           | 16,747                                               | 6,000              | 7,247              
|Loss on disposal of subsidiary                                             | 17,741                                               |                   |                   
|                                                                           |                                                      |                    |                    
|Changes in operating assets and liabilities:                               |                                                      |                    |                    
|Accounts receivable                                                        | (936)                                                | 6,277              | 15,616             
|Inventory                                                                  | 8,736                                                | 2,527              | (2,127)            
|Prepaid expenses                                                           | (429)                                                |                   | (429)              
|Accounts payable and accrued liabilities                                   | (13,701)                                             | (22,733)           | (16,713)           
|Due to related parties                                                     | 538                                                  |                   | 538                
|                                                                           |                                                      |                    |                    
|Net Cash Flows Used in Operating Activities                                | (165,665)                                            | (73,591)           | (71,996)           
|                                                                           |                                                      |                    |                    
|Investing Activities                                                       |                                                      |                    |                    
|                                                                           |                                                      |                    |                    
|Website development costs                                                  | (2,500)                                              |                   |                   
|Disposal of subsidiary                                                     | 1,726                                                |                   |                   
|Cash received on acquisition of CTT Distributors Ltd.                      | 718                                                  |                   |                   
|                                                                           |                                                      |                    |                    
|Net Cash Flows Used in Investing Activities                                | (56)                                                 |                   |                   
|                                                                           |                                                      |                    |                    
|Financing Activities                                                       |                                                      |                    |                    
|                                                                           |                                                      |                    |                    
|Proceeds from issuance of note payable to related party                    | 62,156                                               | 51,000             |                   
|Proceeds from issuance of common stock, net of offering costs              | 120,493                                              | 25,458             | 57,933             
|                                                                           |                                                      |                    |                    
|Net Cash Flows Provided by Financing Activities                            | 182,649                                              | 76,458             | 57,933             
|                                                                           |                                                      |                    |                    
|Increase (Decrease) in Cash                                                | 16,928                                               | 2,867              | (14,063)           
|                                                                           |                                                      |                    |                    
|Cash  Beginning of Period                                                 |                                                     | 14,061             | 28,124             
|                                                                           |                                                      |                    |                    
|Cash  End of Period                                                       | 16,928                                               | 16,928             | 14,061             
|                                                                           |                                                      |                    |                    
|                                                                           |                                                      |                    |                    
|Supplemental Disclosures                                                   |                                                      |                    |                    
|                                                                           |                                                      |                    |                    
|Interest paid                                                              |                                                     |                   |                   
|Income taxes paid                                                          |                                                     |                   |                   
|                                                                           |                                                      |                    |                    



(The accompanying notes are an integral part of these consolidated financial statements)

F4







---

|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 35





CTT International Distributors Inc.

(A Development Stage Company)

Consolidated Statement of Stockholders Deficit

From May 17, 2004 (Date of Inception) to December 31, 2006

(Expressed in U.S. dollars)





|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         
|------------------------------------------------------------------- |  | ---------- |  | -------- |  | ---------- |  | ------- |  | ----------- |  | --------
|                                                                    |  |            |  |          |  |            |  |         |  | Deficit     |  |         
|                                                                    |  |            |  |          |  |            |  |         |  | Accumulated |  |         
|                                                                    |  |            |  |          |  | Additional |  |         |  | During the  |  |         
|                                                                    |  | Common     |  |          |  | Paid in    |  | Donated |  | Development |  |         
|                                                                    |  | Shares     |  | Amount   |  | Capital    |  | Capital |  | Stage       |  | Total   
|                                                                    |  | #          |  | $        |  | $          |  | $       |  | $           |  | $       
|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         
|Balance  May 17, 2004 (Date of Inception) of CTT Distributors Ltd. |  |           |  |         |  |           |  |        |  |            |  |        
|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         
|Common stock issued for cash                                        |  | 455,001    |  | 45,501   |  |           |  |        |  |            |  | 45,501  
|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         
|Stock offering costs                                                |  |           |  |         |  | (8,399)    |  |        |  |            |  | (8,399) 
|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         
|Adjustments for reverse acquisition:                                |  |            |  |          |  |            |  |         |  |             |  |         
|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         
|Remove stock of CTT Distributors Ltd.                               |  | (455,001)  |  | (45,501) |  |           |  |        |  |            |  | (45,501)
|Add stock of CTT International Distributors Inc.                    |  | 10,312,100 |  | 1,031    |  | 44,470     |  |        |  |            |  | 45,501  
|Stock issued on reverse acquisition                                 |  | 455,001    |  | 46       |  | 3,354      |  |         |  |             |  | 3,400   
|Transaction costs of reverse acquisition                            |  |           |  |         |  | (718)      |  |        |  | (34,282)    |  | (35,000)
|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         
|Stock returned to treasury and cancelled                            |  | (450,000)  |  | (45)     |  | 45         |  |        |  |            |  |        
|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         
|Donated services                                                    |  |           |  |         |  |           |  | 3,500   |  |            |  | 3,500   
|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         
|Net loss                                                            |  |           |  |         |  |           |  |        |  | (52,883)    |  | (52,883)
|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         
|Balance  December 31, 2004                                         |  | 10,317,101 |  | 1,032    |  | 38,752     |  | 3,500   |  | (87,165)    |  | (43,881)
|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         
|Common stock issued  for cash at $0.10 per share                    |  | 700,000    |  | 70       |  | 69,930     |  |        |  |            |  | 70,000  
|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         
|Stock offering costs                                                |  |           |  |         |  | (12,067)   |  |        |  |            |  | (12,067)
|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         
|Donated services                                                    |  |           |  |         |  |           |  | 7,247   |  |            |  | 7,247   
|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         
|Net loss                                                            |  |           |  |         |  |           |  |        |  | (76,753)    |  | (76,753)
|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         
|Balance  December 31, 2005                                         |  | 11,017,101 |  | 1,102    |  | 96,615     |  | 10,747  |  | (163,918)   |  | (55,454)
|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         
|Common stock issued for cash at $0.10 per share                     |  | 380,000    |  | 38       |  | 37,962     |  |        |  |            |  | 38,000  
|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         
|Stock offering costs                                                |  |           |  |         |  | (12,542)   |  |        |  |            |  | (12,542)
|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         
|Donated services                                                    |  |           |  |         |  |           |  | 6,000   |  |            |  | 6,000   
|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         
|Net loss                                                            |  |           |  |         |  |           |  |        |  | (66,287)    |  | (66,287)
|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         
|Balance  December 31, 2006                                         |  | 11,397,101 |  | 1,140    |  | 122,035    |  | 16,747  |  | (230,205)   |  | (90,283)
|                                                                    |  |            |  |          |  |            |  |         |  |             |  |         





(The accompanying notes are an integral part of these consolidated financial statements)

F5









---

|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 36



CTT International Distributors Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

(Expressed in US dollars)



1.

Development Stage Company

The Company was incorporated in the State of Delaware on January 14, 2000. Pursuant to an Agreement dated December 29, 2004 (the Agreement), the Company issued 455,001 shares of common stock in exchange for all of the issued and outstanding shares of common stock of CTT Distributors Ltd. (Distributors). Distributors was incorporated in the Province of British Columbia, Canada, on May 17, 2004. The acquisition was considered a reverse acquisition for accounting and financial reporting purposes. The consolidated financial statements include the accounts of the Company since the reverse merger (December 29, 2004) and the historical accounts of Distributors since the date of its inception, May 17, 2004. All significant intercompany balances and transfers have been eliminated on consolidation. Prior to the acquisition of Distributors, the Companys sole asset consisted of ownership of a 100% interest in Slabsdirect.com Online (BC) Ltd. (SlabsOnline), a company incorporated in the Province of British Columbia, Canada. SlabsOnline was unsuccessful in the business of establishing a vertical trade portal on the Internet for the natural stone industry. The Company disposed of its interest in SlabsOnline to the former President of the Company.

The Company incorporated a wholly-owned subsidiary, CTT International Distributors Inc. on November 1, 2004 under the laws of the State of Delaware. Effective January 7, 2005, CTT International Distributors Inc. merged with and into the Company, and the Company was the surviving corporation. Concurrent with the merger, the Company changed its name from Slabsdirect.com, Inc. to CTT International Distributors Inc.

The Company is based in Vancouver, British Columbia, and its principal business is as an online fulfillment company that markets unique products to the internet consumer through its website Cheaperthanthem.com. The Companys website offers electronic products consisting of OEM, non-branded and overstock electronic and computer products for the consumer and wholesaler.

The Company is in the development stage and planned principal activities have commenced, but to date there has been no significant revenue. In a development stage company, management devotes most of its activities to developing a market for its products and services. These consolidated financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The Company has not generated significant revenue and has never paid any dividends. The Company is unlikely to pay dividends or generate significant earnings in the immediate or foreseeable future. The continuation of the Company as a going concern and the ability of the Company to emerge from the development stage are dependent upon the continued financial support from its shareholders, the ability of the Company to obtain necessary equity financing to continue operations and to generate sustainable significant revenue. There is no guarantee that the Company will be able to raise any equity financing or generate profitable operations. As at December 31, 2006, the Company has a working capital deficiency of $91,220 and has accumulated losses of $230,205 since inception. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. These factors raise substantial doubt regarding the Companys ability to continue as a going concern.

The Company filed an amended Form SB-2 Registration Statement (SB-2) with the United States Securities and Exchange Commission on June 14, 2006 to register 2,382,933 shares of common stock held by existing shareholders for resale at a price of $0.10 per share. The SB-2 was declared effective on June 29, 2006. The Company will not receive any proceeds from the resale of shares of common stock by the selling stockholders. Also, pursuant to the SB-2, the Company planned to offer up to 2,500,000 common shares at a price of $0.10 per share for maximum proceeds of $250,000 to the Company. As at December 31, 2006, the Company has issued 380,000 common shares for proceeds of $38,000 with respect to the offering. Subsequent to year end, the Company entered into Plan of Merger and Stock Purchase Agreements. Refer to Note 8.





2.

Summary of Significant Accounting Principles

a)

Basis of Presentation

These consolidated financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States, and are expressed in US dollars. The Company has not produced significant revenues from its principal business and is a development stage company as defined by Statement of Financial Accounting Standard (SFAS) No. 7 Accounting and Reporting by Development Stage Enterprises. These financial statements include accounts of the Company and its wholly-owned subsidiary, CTT Distributors Ltd. All intercompany transactions and balances have been eliminated. The Companys fiscal year end is December 31.

F-6







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|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 37



CTT International Distributors Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

(Expressed in US dollars)



2.

Summary of Significant Accounting Principles (continued)

b)

Use of Estimates

The preparation of financial statements in conformity with US 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. The Company regularly evaluates estimates and assumptions related to donated expenses, collectibility of accounts receivable, inventory reserves, intangible assets, and deferred income tax asset valuations. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Companys estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

c)

Cash and Cash Equivalents

The Company considers all highly liquid instruments with a maturity of three months or less at the time of issuance to be cash equivalents.

d)

Inventory

Inventory is recorded at the lower of cost and net realizable value on a first-in, first-out basis. At December 31, 2006, the Company did not hold any inventory.

e)

Comprehensive Loss

SFAS No. 130, Reporting Comprehensive Income, establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As at December 31, 2006 and 2005, the Company has no items that represent a comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the consolidated financial statements.

f)

Financial Instruments and Concentration Risk

The fair value of financial instruments which include cash, accounts receivable, accounts payable, accrued liabilities, note payable and due to a related party were estimated to approximate their carrying value due to the immediate or relatively short maturity of these instruments. Financial instruments which potentially subject the Company to a concentration of credit risk consist primarily of cash and accounts receivable. The Company deposits cash with a high quality financial institution. The largest concentration of risk is one customer who represents 55% (2005 - 29%) of the total accounts receivable and from a second customer who represents 38% (2005 - 25%) of the total accounts receivable. For the year ended December 31, 2006, revenue from one customer represented 55% (2005 - 25%) of total revenue and from a second customer represented 38% (2005 - 14%) of total revenue. For the year ended December 31, 2006, the Company did not purchase any inventory. For the year ended December 31, 2005, the Company purchased 100% of its inventory from one vendor.

g)

Basic and Diluted Net Income (Loss) Per Share

The Company computes net income (loss) per share in accordance with SFAS No. 128, "Earnings per Share", which requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing Diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti dilutive.

h)

Website Development Costs

The Company recognizes the costs associated with developing a website in accordance with the American Institute of Certified Public Accountants (AICPA) Statement of Position (SOP) No. 98-1, Accounting for the Costs of Computer Software Developed or Obtained for Internal Use. Relating to website development costs the Company follows the guidance pursuant to the Emerging Issues Task Force (EITF) No. 00-2, Accounting for Website Development Costs.

F-7







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|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 38



CTT International Distributors Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

(Expressed in US dollars)



2.

Summary of Significant Accounting Principles (continued)

i)

Long-Lived Assets

In accordance with SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets, the Company tests long-lived assets or asset groups for recoverability when events or changes in circumstances indicate that their carrying amount may not be recoverable. Circumstances which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than not be sold or disposed significantly before the end of its estimated useful life.

Recoverability is assessed based on the carrying amount of the asset and its fair value which is generally determined based on the sum of the undiscounted cash flows expected to result from the use and the eventual disposal of the asset, as well as specific appraisal in certain instances. An impairment loss is recognized when the carrying amount is not recoverable and exceeds fair value.

j)

Foreign Currency Translation

The Companys functional and reporting currency is the United States dollar. Monetary assets and liabilities denominated in foreign currencies are translated in accordance with SFAS No. 52 Foreign Currency Translation, using the exchange rate prevailing at the balance sheet date. Gains and losses arising on settlement of foreign currency denominated transactions or balances are included in the determination of income. Foreign currency transactions are primarily undertaken in Canadian dollars. The Company has not, to the date of these financials statements, entered into derivative instruments to offset the impact of foreign currency fluctuations.

k)

Revenue Recognition

The Company recognizes revenue from the sale of electronic products, such as MP3 players, in accordance with Securities and Exchange Commission Staff Accounting Bulletin No. 104 (SAB 104), Revenue Recognition in Financial Statements. Revenue consists of the sale of electronic products and is recognized only when the price is fixed or determinable, persuasive evidence of an arrangement exists, the product is shipped, and collectibility is reasonably assured. The Company continually monitors timely payments and assesses any collection issues. The allowance for doubtful accounts is based on the Companys detailed assessment of the collectibility of specific customer accounts. Any significant customer accounts that are not expected to be collected are excluded from revenues.

l)

Income Taxes

Potential benefits of income tax losses are not recognized in the accounts until realization is more likely than not. The Company has adopted SFAS No. 109 Accounting for Income Taxes as of its inception. Pursuant to SFAS No. 109 the Company is required to compute tax asset benefits for net operating losses carried forward. Potential benefit of net operating losses have not been recognized in these financial statements because the Company cannot be assured it is more likely than not it will utilize the net operating losses carried forward in future years.

m)

Stock-based Compensation

The Company records stock-based compensation in accordance with SFAS No. 123R Share Based Payments, using the fair value method. The Company has not issued any stock options since its inception.

n)

Recent Accounting Pronouncements

In February 2007, the Financial Accounting Standards Board (FASB) issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities  Including an Amendment of FASB Statement No. 115. This statement permits entities to choose to measure many financial instruments and certain other items at fair value. Most of the provisions of SFAS No. 159 apply only to entities that elect the fair value option. However, the amendment to SFAS No. 115 Accounting for Certain Investments in Debt and Equity Securities applies to all entities with available-for-sale and trading securities. SFAS No. 159 is effective as of the beginning of an entitys first fiscal year that begins after November 15, 2007. Early adoption is permitted as of the beginning of a fiscal year that begins on or before November 15, 2007, provided the entity also elects to apply the provision of SFAS No. 157, Fair Value Measurements. The adoption of this statement is not expected to have a material effect on the Company's financial statements.

F-8







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|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 39



CTT International Distributors Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

(Expressed in US dollars)



2.

Summary of Significant Accounting Principles (continued)

n)

Recent Accounting Pronouncements (continued)

In September 2006, the SEC issued Staff Accounting Bulletin (SAB) No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements. SAB No. 108 addresses how the effects of prior year uncorrected misstatements should be considered when quantifying misstatements in current year financial statements. SAB No. 108 requires companies to quantify misstatements using a balance sheet and income statement approach and to evaluate whether either approach results in quantifying an error that is material in light of relevant quantitative and qualitative factors. SAB No. 108 is effective for periods ending after November 15, 2006. The adoption of SAB No. 108 did not have a material effect on the Companys financial statements.

In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements. The objective of SFAS No. 157 is to increase consistency and comparability in fair value measurements and to expand disclosures about fair value measurements. SFAS No. 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. SFAS No. 157 applies under other accounting pronouncements that require or permit fair value measurements and does not require any new fair value measurements. The provisions of SFAS No. 157 are effective for fair value measurements made in fiscal years beginning after November 15, 2007. The adoption of this statement is not expected to have a material effect on the Company's future reported financial position or results of operations.

In September 2006, the FASB issued SFAS No. 158, Employers Accounting for Defined Benefit Pension and Other Postretirement Plans  an amendment of FASB Statements No. 87, 88, 106, and 132(R). This statement requires employers to recognize the overfunded or underfunded status of a defined benefit postretirement plan (other than a multiemployer plan) as an asset or liability in its statement of financial position and to recognize changes in that funded status in the year in which the changes occur through comprehensive income of a business entity or changes in unrestricted net assets of a not-for-profit organization. This statement also requires an employer to measure the funded status of a plan as of the date of its year-end statement of financial position, with limited exceptions. The provisions of SFAS No. 158 are effective for employers with publicly traded equity securities as of the end of the fiscal year ending after December 15, 2006. The adoption of this statement is not expected to have a material effect on the Company's future reported financial position or results of operations.

In June 2006, the Financial Accounting Standards Board (FASB) issued FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes, an interpretation of FASB Statements No. 109. FIN 48 clarifies the accounting for uncertainty in income taxes by prescribing a two-step method of first evaluating whether a tax position has met a more likely than not recognition threshold and second, measuring that tax position to determine the amount of benefit to be recognized in the financial statements. FIN 48 provides guidance on the presentation of such positions within a classified statement of financial position as well as on derecognition, interest and penalties, accounting in interim periods, disclosure, and transition. FIN 48 is effective for fiscal years beginning after December 15, 2006. The adoption of this statement is not expected to have a material effect on the Company's future reported financial position or results of operations.

In March 2006, the FASB issued SFAS No. 156, "Accounting for Servicing of Financial Assets, an amendment of FASB Statement No. 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities". This statement requires all separately recognized servicing assets and servicing liabilities be initially measured at fair value, if practicable, and permits for subsequent measurement using either fair value measurement with changes in fair value reflected in earnings or the amortization and impairment requirements of Statement No. 140. The subsequent measurement of separately recognized servicing assets and servicing liabilities at fair value eliminates the necessity for entities that manage the risks inherent in servicing assets and servicing liabilities with derivatives to qualify for hedge accounting treatment and eliminates the characterization of declines in fair value as impairments or direct write-downs. SFAS No. 156 is effective for an entity's first fiscal year beginning after September 15, 2006. The adoption of this statement is not expected to have a material effect on the Company's future reported financial position or results of operations.

F-9







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|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 40



CTT International Distributors Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

(Expressed in US dollars)



2.

Summary of Significant Accounting Principles (continued)

n)

Recent Accounting Pronouncements (continued)

In February 2006, the FASB issued SFAS No. 155, "Accounting for Certain Hybrid Financial Instruments-an amendment of FASB Statements No. 133 and 140", to simplify and make more consistent the accounting for certain financial instruments. SFAS No. 155 amends SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities", to permit fair value re-measurement for any hybrid financial instrument with an embedded derivative that otherwise would require bifurcation, provided that the whole instrument is accounted for on a fair value basis. SFAS No. 155 amends SFAS No. 140, "Accounting for the Impairment or Disposal of Long-Lived Assets", to allow a qualifying special-purpose entity to hold a derivative financial instrument that pertains to a beneficial interest other than another derivative financial instrument. SFAS No. 155 applies to all financial instruments acquired or issued after the beginning of an entity's first fiscal year that begins after September 15, 2006, with earlier application allowed. The adoption of this statement is not expected to have a material effect on the Company's future reported financial position or results of operations.

o)

Reclassifications

Certain reclassifications have been made to the prior periods financial statements to conform to the current periods presentation.





3.

Intangible Assets

| |                           |        |                            |                                        |                                       
| | ------------------------- | ------ | -------------------------- | -------------------------------------- | --------------------------------------
| |                           | Cost
$ | Accumulated
Amortization
$ | December 31,
2006
Net Carrying
Value
$ | December 31,
2005
Net Carrying
Value
$
| |                           |        |                            |                                        |                                       
| | Website development costs | 2,500  | 1,563                      | 937                                    | 1,562                                 
| |                           |        |                            |                                        |                                       

Costs associated with the website consist primarily of website design costs. These capitalized costs are being amortized based on their estimated useful life over four years. Internal costs related to the development of website content are charged to operations as incurred.





4.

Related Party Balances/Transactions

a)

During the year ended December 31, 2006, the Company issued a demand note in the amount of $10,000 to the President of the Company. The note is unsecured, non-interest bearing and due on demand. The Company owes $1,794 to the President of the Company for expenses paid on behalf of the Company, which is unsecured, non-interest bearing and due on demand.

b)

During the year ended December 31, 2006, the Company recognized a total of $6,000 (2005 - $6,000) for donated services provided by the President of the Company and $nil (2005 - $1,247) of donated rent.

c)

On April 9, 2006, the Company issued a demand promissory note to the President of the Company for cash advances of $41,000. The note is unsecured, non-interest bearing and due on demand.

d)

On June 9, 2004, the Company issued a demand promissory note to the President of the Company for the acquisition of its opening inventory in the amount of $8,736.  The note is unsecured, non-interest bearing and due on demand.





5.

Commitment

On October 1, 2005, the Company entered into a lease agreement for office premises at a rate of CDN$535 per month plus overhead expenses, on a month-to-month basis. For the years ended December 31, 2006 and 2005, the Company incurred rent expense of $6,669 and $3,790, respectively, which has been recorded as general and administrative expense.

F-10







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|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 41



CTT International Distributors Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

(Expressed in US dollars)



6.

Common Stock

a)

On December 4, 2006, the Company issued 380,000 common shares at $0.10 per share for cash proceeds of $25,458, net of offering costs of $12,542.

b)

On October 4, 2005, the Company issued 700,000 common shares at $0.10 per share for cash proceeds of $57,933, net of offering costs of $12,067.





7.

Income Tax

Potential benefits of income tax losses are not recognized in the accounts until realization is more likely than not. The Company has non-capital losses carried forward totalling $221,000 for US tax purposes and $40,000 for Canadian tax purposes, which expire starting in 2020 and 2011, respectively. Pursuant to SFAS No. 109 the Company is required to compute tax asset benefits for net operating losses carried forward. Potential benefit of net operating losses have not been recognized in these financial statements because the Company cannot be assured it is more likely than not it will utilize the net operating losses carried forward in future years. For the years ended December 31, 2006 and 2005, the valuation allowance established against the deferred tax assets increased by $21,050 and $24,900, respectively.

The components of the net deferred tax asset at December 31, 2006 and 2005, the statutory tax rate, the effective tax rate and the elected amount of the valuation allowance are scheduled below:



|                       |  |                     |  |                    
|---------------------- |  | ------------------- |  | -------------------
|                       |  | December 31,
2006
$ |  | December 31,
2005
$
|                       |  |                     |  |                    
|Net Operating Loss     |  | 261,000             |  | 201,000            
|                       |  |                     |  |                    
|Statutory Tax Rate     |  | 35%                 |  | 35%                
|                       |  |                     |  |                    
|Effective Tax Rate     |  |                    |  |                   
|                       |  |                     |  |                    
|Deferred Tax Asset     |  | 91,350              |  | 70,300             
|                       |  |                     |  |                    
|Valuation Allowance    |  | (91,350)            |  | (70,300)           
|                       |  |                     |  |                    
|Net Deferred Tax Asset |  |                    |  |                   





8.

Subsequent Events

a)

The Company entered into an Agreement and Plan of Merger (the Merger Agreement) dated April 16, 2007 with Reliablecom Acquisition Corp., a wholly-owned subsidiary of the Company incorporated on April 16, 2007 (Acquisition), Reliablecom, Inc. (Reliablecom), and Kapadia Holdings, Inc., the sole shareholder of Reliablecom (Holdings). Pursuant to the terms of the Merger Agreement, Acquisition will merge with and into Reliablecom, which will become a wholly-owned subsidiary of the Company (the Merger). The Company will issue an aggregate of 14,625,000 post-dividend shares of common stock and 292,500 shares of series A Preferred stock (the Preferred Stock) to Holdings at the time of the closing of the merger. Each share of Preferred Stock will be convertible into 50 post-dividend shares of the Companys common stock, upon effectuation of an increase in the Companys authorized shares of common stock to 100,000,000 shares.

Upon execution of the Merger Agreement, the Companys former President Amit Sankhala (Sankhala) resigned as an officer and a member of the Board of Directors of the Company. Sankhala also agreed to the return and cancellation of 8,000,000 pre-dividend shares of the Companys common stock owned by him.

Prior to the closing of the Merger Agreement, the Company agreed to change its name to SK3 Group, Inc., declare a two-for-one dividend on outstanding shares of common stock, and complete a private placement offering for an aggregate of $6,500,000 of the Companys common shares at a minimum price of $2.00 per share.

The closing of the Merger Agreement is subject to customary closing conditions. In the event the Merger Agreement has not closed by June 30, 2007, the Merger Agreement shall be terminated unless otherwise agreed to by the respective parties.

F-11







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|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 42



CTT International Distributors Inc.

(A Development Stage Company)

Notes to the Consolidated Financial Statements

(Expressed in US dollars)



8.

Subsequent Events (continued)

b)

On May 9, 2007, the Company, Reliablecom and Sohel Distributors Inc. (SDI), and Sohel Kapadia, the sole shareholder of SDI (Seller), entered into a Stock Purchase Agreement (the Purchase Agreement). Pursuant to the terms of the Purchase Agreement, Reliablecom will acquire 100% of the issued and outstanding capital stock of SDI in exchange for (i) 85,000 shares of series A preferred stock of the Company (the Preferred Stock), and (ii) an earn-out of additional compensation for three years from the closing. The seller will receive 50% of the quarterly profits in excess of $37,500, together with 50% of the annual profits in excess of $150,000 plus the quarterly profit payments. The purchase price is subject to adjustment in the event the working capital of SDI is less than zero at closing. Each share of Preferred Stock has a liquidation preference of $0.01 and will be convertible into 50 post-dividend shares of the Companys common stock, upon effectuation of an increase in the Companys authorized shares of common stock to 100,000,000 shares.

Upon closing of the Purchase Agreement, the Company, Reliablecom and the Seller will enter into an Escrow and Lock-up Agreement, subject to various terms, and pursuant to which the Seller will place the Preferred Stock into escrow.

Upon closing of the Purchase Agreement, the Seller will enter into an employment agreement with SDI, pursuant to which the Seller will serve as President of SDI. For the first three years of the term of the employment agreement, the seller will be paid $150,000 per year. The agreement has a term of three years, and will automatically be renewed for additional one year terms unless terminated by either party at lease 90 days prior to expiration.

The closing of the Purchase Agreement is subject to customary closing conditions. The Purchase Agreement may be terminated prior to closing at the election of the Seller or Reliablecom, in the event the Purchase Agreement has not closed by June 30, 2007.





















F-12









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|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 43





Item 8.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.



There are no changes in and disagreements with CTTs accountants on accounting and financial disclosure.  CTTs Independent Registered Public Accounting Firm from inception to the current date is Manning Elliott LLP, Chartered Accountants, 1100 - 1050 West Pender Street, Vancouver, British Columbia, V6E 3S7, Canada.



Item 8A. Controls and Procedures.



Disclosure Controls and Procedures



Amit Sankhala, CTTs Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of CTTs disclosure controls and procedures (as such term is defined in Rules 13a-15 and 15d-15 under the Securities Exchange Act of 1934 (the Exchange Act )) as of the end of the period covered by this annual report (the Evaluation Date).  Based on such evaluation, Mr. Sankhala has concluded that, as of the Evaluation Date, CTTs disclosure controls and procedures are effective in alerting CTT on a timely basis to material information required to be included in its reports filed or submitted under the Exchange Act.



Changes in Internal Controls



During the quarter of the fiscal year covered by this report, there were no changes in CTTs internal controls or, to CTTs knowledge, in other factors that have materially affected, or are reasonably likely to materially affect, these controls and procedures subsequent to the date CTT carried out this evaluation.



Item 8B.  Other Information



During the fourth quarter of the year covered by this Form 10-KSB, CTT had no information to be disclosed as required on a Form 8-K that was not disclosed.



PART III



Item 9.

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



(a)

Identify Directors and Executive Officers



CTTs directors are elected by the stockholders to a term of one year and serves until his successor is elected and qualified.  CTTs officers are appointed by the board of directors to a term of one year and serves until his successor is duly appointed and qualified, or until he is removed from office.



The names, addresses, ages and positions of CTTs officers and directors as of May 14, 2007, are set forth below:



|                                                     |     |                                                                                                   
|---------------------------------------------------- | --- | --------------------------------------------------------------------------------------------------
|Name and Address                                     | Age | Positions                                                                                         
|Sajid Kapadia
500 Mamoreneck Ave.
Harrison, NY
10528 | 34  | Chief Executive Officer, Chief Financial Officer and Secretary, member of CTTs Board of Directors

INSERT A

Amit Sankhala●  Amit Sankhala (24 years) had been director of CTT since December 2004.  Mr. Sankhala was an officer of CTT from December 2004 until April 16, 2007. Mr. Sankhala is currently a Political Science student attending Simon Fraser University.  In 2001, Mr. Sankhala developed an internet marketing strategy for his tour company, Dynamic Tours Pvt. Ltd..  Since May 2003, Mr. Sankhala has been an employee of Tiger Ventures Inc., which oversees operations of Dynamic Tours Pvt. Ltd. and Tiger Resorts Pvt. Ltd.  Since 2003, Mr. Sankhala has been the Managing Director of Dynamic Tours Pvt. Ltd. of New Delhi, India, an organization established in 1983 that caters to wildlife, adventure and special interest tours in India.  Since 2003, Mr. Sankhala has also been the Managing Director of Tiger Resorts Pvt. Ltd. of New Delhi, India, an organization which has two jungle lodges, located in Kanha National Park and Bandhavgarh National Park, which are both world renowned jungles for their tiger population.

Sajid Kapadia ●  Mr. Kapadia has been Chief Executive Office, Chief Financial Officer and Secretary and a member of CTT’s Board of Directors since April 2007. Mr. Kapadia has been President of Reliablecom since January 2007, when Reliablecom acquired Reliable Reliable E-Commerce from Mr. Kapadia. He has been President of Reliable E-Commerce Inc. since 2006. From 2004 through 2005, Mr. Kapadaia was vice president of 9278 Dot Com and was President of 9278 Distributor from 1999 through 2004. Each of these companies was engaged in the distribution and sale of prepaid phone cards, telecommunications sales or related business activities. Mr. Kapadia received a degree in Mechanical Engineering from Gandhi Engineering College.







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|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 44





Conflicts of interest



CTT thinks that its sole officer may be subject to conflicts of interest because the sole officer may not be able to devote all his time to CTTs operations.  Mr. Kapadia devotes 10 hours a week to CTTs operations.



(b)

Identify Significant Employees



CTT does not have any significant employees.  However, CTT has retained Ezyra E-Business Services to host the website and as required, will engage a web developer to make enhancements and changes to the website.  Amit Sankhala believes that the third party independent contractors that CTT engages from time to time make a significant contribution to CTTs business operations.



(c)

Family Relationships



There are no family relationships among the directors, executive officers or persons nominated or chosen by CTT to become directors or executive officers.



(d)

Involvement in Certain Legal Proceedings



(1)

No bankruptcy petition has been filed by or against any business of which any director was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time.



(2)

No director has been convicted in a criminal proceeding and is not subject to a pending criminal proceeding (excluding traffic violations and other minor offences).



(3)

No director has been subject to any order, judgement, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities.



(4)

No director has been found by a court of competent jurisdiction (in a civil action), the Securities Exchange Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, that has not been reversed, suspended, or vacated.



(e)

Compliance with Section 16(a) of the Exchange Act.



All reports were filed with the SEC on a timely basis and CTT is not aware of any failures to file a required report during the period covered by this annual report.



(f)

Nomination Procedure for Directors



CTT does not have a standing nominating committee; recommendations for candidates to stand for election as directors are made by the board of directors.  CTT has not adopted a policy that permits shareholders to recommend nominees for election as directors or a process for shareholders to send communications to the board of directors.



(f)

Audit Committee Financial Expert



CTT has no financial expert.  Amit Sankhala believes the cost related to retaining a financial expert at this time is prohibitive. Further, because of CTTs limited operations, Amit Sankhala believes the services of a financial expert are not warranted.











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|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 45





(g)

Identification of Audit Committee



CTT does not have a separately-designated standing audit committee. Rather, CTTs audit committee is comprised of its sole director and officer.  Amit Sankhala is the only member of CTTs audit committee, but does not meet the independent requirements for an audit committee member.  CTTs audit committee is responsible for: (1) selection and oversight of our independent accountant; (2) establishing procedures for the receipt, retention and treatment of complaints regarding accounting, internal controls and auditing matters; (3) establishing procedures for the confidential, anonymous submission by our employees of concerns regarding accounting and auditing matters; (4) engaging outside advisors; and, (5) funding for the outside auditory and any outside advisors engagement by the audit committee.  CTT has adopted an audit committee charter, a copy of which is filed as an exhibit to this report.  See Exhibit 99.1  Audit Committee Charter for more information.



(h)

Disclosure Committee and Charter



CTT has a disclosure committee and disclosure committee charter.  CTTs disclosure committee is comprised of its sole officer and director.  The purpose of the committee is to provide assistance to the chief executive officer and the chief financial officer in fulfilling their responsibilities regarding the identification and disclosure of material information about CTT and the accuracy, completeness and timeliness of CTTs financial reports.  CTT has adopted a disclosure committee charter, a copy of which is filed as an exhibit to this report.   See Exhibit 99.2  Disclosure Committee Charter for more information.



(i)

Code of Ethics



CTT has adopted a code of ethics that applies to all its executive officers and employees, including its CEO and CFO.  A copy of CTTs adopted code of ethics is attached to this annual report.  See Exhibit 14  Code of Ethics for more information.  Also, CTTs code of ethics has been posted on its website at www.cheaperthanthem.com.  CTT undertakes to provide any person with a copy of its code of ethics free of charge.  Please contact Amit Sankhala at 604-733-2600 to request a copy of CTTs code of ethics.  CTT believes CTTs code of ethics is reasonably designed to deter wrongdoing and promote honest and ethical conduct; provide full, fair, accurate, timely and understandable disclosure in public reports; comply with applicable laws; ensure prompt internal reporting of code violations; and provide accountability for adherence to the code.



Item 10.  Executive Compensation.



SUMMARY COMPENSATION TABLE



|                                                         |                |                  |                 |                       |                        |                                    |                                                        |                                  |                
|-------------------------------------------------------- | -------------- | ---------------- | --------------- | --------------------- | ---------------------- | ---------------------------------- | ------------------------------------------------------ | -------------------------------- | ---------------
|Name and principal position

(a)                         | Year



(b)    | Salary

($)

(c) | Bonus

($)

(d) | Stock Awards
($)

(e) | Option Awards
($)

(f) | Non-Equity Incentive Plan
($)

(g) | Non-qualified Deferred Compen-
sation Earnings ($)
(h) | All other compen-sation
($)

(i) | Total

($)

(j)
|Amit Sankhala
CEO, CFO, and President
Jan 05 to Apr 07 | 2004
2005
2006 | n/a
nil
nil      | n/a
nil
nil     | n/a
nil
nil           | n/a
nil
nil            | n/a
nil
nil                        | n/a
nil
nil                                            | n/a
nil
nil                      | n/a
nil
nil    
|Steven Bruk
CEO, CFO, and President
Jan 00 to Jan 05   | 2004
2005
2006 | nil
nil
n/a      | nil
nil
n/a     | nil
nil
n/a           | nil
nil
n/a            | nil
nil
n/a                        | nil
nil
n/a                                            | nil
nil
n/a                      | nil
nil
n/a    



Currently, there are no arrangements between CTT and any of its directors or between the Subsidiary and any of its directors whereby such directors are compensated for any services provided as directors.











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|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 46





Item 11.  Security Ownership of Certain Beneficial Holders and Management.



Security Ownership of Certain Beneficial Owners (more than 5%)



The following table sets forth, as of the date of this annual report, the total number of shares of common stock owned beneficially by CTTs sole director, officer and key employee, individually and as a group, and the present owners of 5% or more of CTTs total outstanding shares of common stock.  The stockholder listed below has direct ownership of his shares and possesses sole voting and dispositive power with respect to the shares.



| |                |                                                                                           |                                          |                    
| | -------------- | ----------------------------------------------------------------------------------------- | ---------------------------------------- | -------------------
| | Title of Class | Name and Address of Beneficial Owner                                                      | Amount and Nature of Beneficial Owner[1] | Percent
of Class[2]
| | Common Stock   | Amit Sankhala
Suite 203
6595 Willingdon Avenue
Burnaby, British Columbia
V5H 4E5   Canada | 6,634,168                                | 70.6%              

[1]The listed beneficial owner has no right to acquire any shares within 60 days of the date of this Form 10-KSB from options, warrants, rights, conversion privileges or similar obligations excepted as otherwise noted.

[2]Based on 9,397,101 shares of common stock issued and outstanding as of May 14, 2007.

Security Ownership of Management



| |                |                                                                                           |                                       |                    
| | -------------- | ----------------------------------------------------------------------------------------- | ------------------------------------- | -------------------
| | Title of Class | Name and Address of Beneficial Owner                                                      | Amount and Nature of Beneficial Owner | Percent
of Class[1]
| | Common Stock   | Amit Sankhala
Suite 203
6595 Willingdon Avenue
Burnaby, British Columbia
V5H 4E5   Canada | 6,634,168                             | 70.6%              
| | Common Stock   | Sajid Kapadia
500 Mamoreneck Ave.
Harrison, NY
10528                                      | 0                                     | -                  
| | Common Stock   | Directors and Executive Officers as a group                                               | 6,634,168                             | 70.6%              

[1]Based on 9,397,101 shares of common stock issued and outstanding as of May 14, 2007.



Changes in Control



CTT is not aware of an arrangement that may result in a change in control of CTT, with the exception of the following:



CTT entered into an Agreement and Plan of Merger (the Merger Agreement) dated April 16, 2007 with Reliablecom Acquisition Corp., a wholly-owned subsidiary of the Company incorporated on April 16, 2007 (Acquisition), Reliablecom, Inc. (Reliablecom), and Kapadia Holdings, Inc., the sole shareholder of Reliablecom (Holdings).  Pursuant to the terms of the Merger Agreement, Acquisition will merge with and into Reliablecom, which will become a wholly-owned subsidiary of the CTT (the Merger).  CTT will issue an aggregate of 14,625,000 post-dividend shares of common stock and 292,500 shares of series A Preferred stock (the Preferred Stock) to Holdings at the time of the closing of the merger. Each share of Preferred Stock will be convertible into 50 post-dividend shares of the Companys common stock, upon effectuation of an increase in CTTs authorized shares of common stock to 100,000,000 shares.

Upon execution of the Merger Agreement, CTTs former President Amit Sankhala (Sankhala) resigned as an officer and a member of the Board of Directors of CTT. Sankhala also agreed to the return and cancellation of 8,000,000 pre-dividend shares of CTTs common stock owned by him.

Prior to the closing of the Merger Agreement, CTT agreed to change its name to SK3 Group, Inc., and declare a two-for-one dividend on outstanding shares of common stock.

The closing of the Merger Agreement is subject to customary closing conditions. In the event the Merger Agreement has not closed by June 30, 2007, the Merger Agreement shall be terminated unless otherwise agreed to by the respective parties.









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|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 47





On May 9, 2007, CTT, Reliablecom and Sohel Distributors Inc. (SDI), and Sohel Kapadia, the sole shareholder of SDI (Seller), entered into a Stock Purchase Agreement (the Purchase Agreement).  Pursuant to the terms of the Purchase Agreement, Reliablecom will acquire 100% of the issued and outstanding capital stock of SDI in exchange for (i) 85,000 shares of series A preferred stock of CTT (the Preferred Stock), and (ii) an earn-out of additional compensation for three years from the closing. The seller will receive 50% of the quarterly profits in excess of $37,500, together with 50% of the annual profits in excess of $150,000 plus the quarterly profit payments. The purchase price is subject to adjustment in the event the working capital of SDI is less than zero at closing. Each share of Preferred Stock has a liquidation preference of $0.01 and will be convertible into 50 post-dividend shares of the Companys common stock, upon effectuation of an increase in CTTs authorized shares of common stock to 100,000,000 shares.

Upon closing of the Purchase Agreement, CTT, Reliablecom and the Seller will enter into an Escrow and Lock-up Agreement, subject to various terms, and pursuant to which the Seller will place the Preferred Stock into escrow.

Upon closing of the Purchase Agreement, the Seller will enter into an employment agreement with SDI, pursuant to which the Seller will serve as President of SDI. For the first three years of the term of the employment agreement, the seller will be paid $150,000 per year. The agreement has a term of three years, and will automatically be renewed for additional one year terms unless terminated by either party at lease 90 days prior to expiration.

The closing of the Purchase Agreement is subject to customary closing conditions. The Purchase Agreement may be terminated prior to closing at the election of the Seller or Reliablecom, in the event the Purchase Agreement has not closed by June 30, 2007.



Item 12.  Certain Relationships and Related Transactions.



(a)

Transactions with Related Persons



Since the beginning of CTTs last fiscal year, no director, executive officer, security holder, or any immediate family of such director, executive officer, or security holder has had any direct or indirect material interest in any transaction or currently proposed transaction, which CTT was or is to be a participant, that exceeded the lesser of (1) $120,000 or (2) one percent of the average of CTTs total assets at year-end for the last three completed fiscal years, except for the following:



During the year ended December 31, 2006, CTT issued a demand note in the amount of $10,000 to Amit Sankhala.  The note is unsecured, non-interest bearing and due on demand. CTT owes $1,794 to Mr. Sankhala for expenses paid on behalf of CTT, which is unsecured, non-interest bearing and due on demand.

On April 9, 2006, CTT issued a demand promissory note to Mr. Sankhala for cash advances of $41,000.  The note is unsecured, non-interest bearing and due on demand.

On June 9, 2004, CTT issued a demand promissory note to Mr. Sankhala for the acquisition of its opening inventory in the amount of $8,736.   The note is unsecured, non-interest bearing and due on demand.



(b)

Promoters and control persons



Amit Sankhala is the sole promoter of CTT.  Mr. Sankhala is the only person who has taken an initiative in founding and organizing its current business.  Mr. Sankhala has not received anything of value from CTT nor is Mr. Sankhala entitled to receive anything of value from CTT for services provided as a promoter.



(c)

Director independence



CTTs shares of common stock are not listed on a national securities exchange or in an inter-dealer quotation system that has requirements that directors be independent.  As a result, CTTs board of directors has adopted, pursuant to Item 407(a)(1)(ii) of Regulation S-B of the Securities Act, the independence standards of the NASDAQ, as set forth in Rule 4200(a)(15) of the NASDAQ Manual, to determine the independence of its directors and those directors serving on its committees, if any.  These standards provide that a person will be considered an independent director if he or she is not an officer of CTT and, in the view of the CTTs board of directors, is free of any relationship that would interfere with the exercise of independent judgment.  In summary, an independent director means a person other than an officer or employee of CTT or its Subsidiary or any other individual having a relationship which, in the opinion of CTTs board of directors, would interfere with the exercise of independent judgement in carrying out the responsibilities of a director, and includes any director who accepted any compensation from CTT in excess of $200,000 during any period of 12 consecutive months with the three past fiscal years.  Also, the ownership of CTTs stock will not preclude a director from being independent.



CTTs board of directors has determined that its sole director does would meet this standard, and therefore, would be considered not to be independent.











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|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 48





As of the date of the report, CTT did not maintain a separately designated audit, compensation or nominating committee.

However, CTT has also adopted this standard for the independence of the members of its audit committee.  Mr. Sankhala is the sole member of CTTs audit committee.  CTTs board of directors has determined that Mr. Sankhala is not independent for purposes of Rule 4200(a)(15) of the NASDAQ Manual, applicable to audit, compensation and nominating committee members, and is therefore not independent for purposes of Section 10A(m)(3) of the Securities Exchange Act.



Item 13.  Exhibits.



(a)

Index to and Description of Exhibits.



|        |                                                                                                                                                                                                                                     |         
|------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------
|Exhibit | Description                                                                                                                                                                                                                         | Status  
|3.1     | Certificate of Ownership of Slabsdirect.com, Inc. and CTT International Distributors Inc. filed as an Exhibit to CTTs Form 8-K (Current Report) filed on January 12, 2005 and incorporated herein by reference.                    | Filed   
|3.2     | Certificate of Incorporation for Slabsdirect.com, Inc. filed as an Exhibit to CTTs Form 10-SB (Registration Statement) filed on June 28, 2000 and incorporated herein by reference.                                                | Filed   
|3.3     | By-laws of Slabsdirect.com, Inc. filed as an Exhibit to CTTs Form 10-SB (Registration Statement) filed on June 28, 2000 and incorporated herein by reference.                                                                      | Filed   
|3.4     | Certificate of Incorporation for CTT Distributors Ltd. filed as an Exhibit to CTTs Form 10-KSB (Annual Report) filed on April 1, 2005 and incorporated herein by reference.                                                        | Filed   
|3.5     | Notice of Articles for CTT Distributors Ltd. filed as an Exhibit to CTTs Form 10-KSB (Annual Report) filed on April 1, 2005 and incorporated herein by reference.                                                                  | Filed   
|3.6     | Articles of CTT Distributors Ltd. filed as an Exhibit to CTTs Form 10-KSB (Annual Report) filed on April 1, 2005 and incorporated herein by reference.                                                                             | Filed   
|10.1    | Share Exchange Agreement dated December 29, 2004, among Slabsdirect.com, Inc, CTT Distributors Ltd., and the shareholders of CCT Distributors Ltd. filed as an exhibit to CTTs Form 8-K (Current Report) filed on January 6, 2005. | Filed   
|10.2    | Stock Purchase

Agreement dated December 29, 2004, between Steven Bruk and Slabsdirect.com, Inc. filed as an exhibit to CTTs Form 8-K (Current Report) filed on January 6, 2005.                                                   | Filed   
|10.3    | Stock Purchase

Agreement dated December 29, 2004, between Amit Sankhala and Steven Bruk filed as an exhibit to CTTs Form 8-K (Current Report) filed on January 6, 2005.                                                           | Filed   
|14      | Code of Ethics filed as an Exhibit to CTTs Form 10-KSB (Annual Report) filed on April 1, 2005 and incorporated herein by reference.                                                                                                | Filed   
|31      | Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                           | Included
|32      | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                             | Included
|99.1    | Audit Committee Charter filed as an Exhibit to CTTs Form 10-KSB (Annual Report) filed on April 1, 2005 and incorporated herein by reference.                                                                                       | Filed   
|99.2    | Disclosure Committee Charter filed as an Exhibit to CTTs Form 10-KSB (Annual Report) filed on April 1, 2005 and incorporated herein by reference.                                                                                  | Filed   









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|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 49





Item 14.   Principal Accounting Fees and Services



(1)   Audit Fees and Related Fees



The aggregate fees billed for each of the last two fiscal years for professional services rendered by the principal accountant for CTTs audit of annual financial statements and for review of financial statements included in CTTs Form 10-QSBs or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years was:



2006 - $13,150 - Manning Elliott LLP  Chartered Accountants

2005 - $11,950 - Manning Elliott LLP  Chartered Accountants



(2)  Audit-Related Fees



The aggregate fees billed in each of the last two fiscal years for assurance and related services by the principal accountants that are reasonably related to the performance of the audit or review of CTTs financial statements and are not reported in the preceding paragraph:



2006 - $nil - Manning Elliott LLP  Chartered Accountants

2005 - $nil - Manning Elliott LLP  Chartered Accountants



(3)   Tax Fees



The aggregate fees billed in each of the last two fiscal years for professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning was:



2006 - $nil - Manning Elliott LLP  Chartered Accountants

2005 - $nil - Manning Elliott LLP  Chartered Accountants

(4)   All Other Fees



The aggregate fees billed in each of the last two fiscal years for the products and services provided by the principal accountant, other than the services reported in paragraphs (1) and (2) was:



2006 - $nil - Manning Elliott LLP  Chartered Accountants

2005 - $nil - Manning Elliott LLP  Chartered Accountants

(5)

CTTs audit committees pre-approval policies and procedures described in paragraph (c)(7)(i) of Rule 2-01 of Regulation S-X were that the audit committee pre-approve all accounting related activities prior to the performance of any services by any accountant or auditor.



(6)

The percentage of hours expended on the principal accountants engagement to audit CTTs financial statements for the most recent fiscal year that were attributed to work performed by persons other than the principal accountants full time, permanent employees was nil.











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|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 50







SIGNATURES





In accordance with Section 13 or 15(d) of the Securities and Exchange Act of 1934, CTT International Distributors Inc. has caused this report to be signed on its behalf by the undersigned duly authorized person.





CTT INTERNATIONAL DISTRIBUTORS INC.





By:  /s/SAJID KAPADIA

Name:

Sajid Kapadia

Title:

CEO and CFO

Dated:

May 15, 2007





Pursuant to the requirements of the Securities Exchange Act of 1934, the following persons on behalf of CTT International Distributors Inc. and in the capacities and on the dates indicated have signed this report below.





|                  |                                                                                                                                                   |             
|----------------- | ------------------------------------------------------------------------------------------------------------------------------------------------- | ------------
|Signature         | Title                                                                                                                                             | Date        
|/s/ SAJID KAPADIA | Chief Executive Officer, Chief Financial Officer, (Principal Executive Officer and
Principal Financial Officer),
member of the Board of Directors | May 15, 2007
|Sajid Kapadia     |                                                                                                                                                   |             
|                  |                                                                                                                                                   |             
|/s/ AMIT SANKHALA | Director                                                                                                                                          | May 15, 2007
|Amit Sankhala     |                                                                                                                                                   |             











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|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 51







________________________________________



Exhibit 31

________________________________________











---

|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 52





CTT INTERNATIONAL DISTRIBUTORS INC. 
CERTIFICATIONS PURSUANT TO 
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, Sajid Kapadia, certify that:

1.   I have reviewed this annual report on Form 10-KSB of CTT International Distributors Inc.;

2.  Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.  Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the small business issuer as of, and for, the periods presented in this report;

4.  The small business issuers other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the small business issuer and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the small business issuers disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the small business issuers internal control over financial reporting that occurred during the small business issuers most recent fiscal quarter (the small business issuers fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuers internal control over financial reporting; and

5.  The small business issuers other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuers auditors and the audit committee of the small business issuers board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuers ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuers internal control over financial reporting.



Date: May 15, 2007





/s/ SAJID KAPADIA____

Sajid Kapadia,

Chief Executive Officer

Chief Financial Officer











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|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 53







________________________________________



Exhibit 32

________________________________________













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|                                    |                    |        
|----------------------------------- | ------------------ | -------
|CTT International Distributors Inc. | Form 10-KSB - 2006 | Page 54





CERTIFICATION PURSUANT TO 
18 U.S.C. SECTION 1350, 
AS ADOPTED PURSUANT TO 
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002



In connection with the Annual Report of CTT International Distributors Inc. (the Company) on Form 10-KSB for the period ending December 31, 2006 as filed with the Securities and Exchange Commission on the date hereof (the Report), I, Sajid Kapadia, Chief Executive Officer and Chief Financial Officer of the Company and a member of the Board of Directors, certify, pursuant to s.906 of the Sarbanes-Oxley Act of 2002, that:

(1)   The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)   The information contained in the Report fairly represents, the financial condition and result of operations of the Company.







/s/ SAJID KAPADIASajid Kapadia,

Chief Executive Officer

and Chief Financial Officer 
May 15, 2007