**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**





**FORM
      10-QSB**








[xx]
            QUARTERLY
                REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
                1934
                FOR THE QUARTERLY PERIOD ENDED MARCH 31,
                2007





Commission
      file Number: 0-28053





**INVESTMENT
      ASSOCIATES, INC.**


(Exact
      name of small business issuer as specified in its charter)





Nevada


(State
      or
      other jurisdiction of incorporation or organization)





98-0204280


(I.R.S.
      Employer Identification Number)





Suite
      700


1620
      Dickson Avenue


Kelowna,
      British Columbia, V1Y 9Y2


(Address
      of principal executive offices)





(250)
      868-8177


(Issuer's
      telephone number)








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





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act).


(check
      one): Yes [ X ] No [ ]





State
      the
      number of shares outstanding of each of the issuer's classes of common equity,
      as of the latest practicable date:   1,000,000
      common shares as at May 14, 2007





Transitional
      Small Business Disclosure Format (check one): Yes [ ] No [ X ]








*-
          1
          -*


**INVESTMENT
      ASSOCIATES, INC.**






**INDEX**


PART
                    1.
                FINANCIAL
                    INFORMATIONItem
                    1.
                
                Financial
                    StatementsBalance
                      Sheet as of March 31, 2007 (unaudited)
                3Statements
                    of Operations for the six monthsended
                    March
                    31, 2007 and 2006 (unaudited)
                4Statements
                  of Cash Flows for the six monthsended March
                  31, 2007 and 2006 (unaudited)
                5Condensed
                    Notes to Interim Financial Statements
                6Item
                    2
                
                Plan
                    of Operation
                10Item
                    3
                
                Controls
                    and Procedures
                13PART
                    II.
                OTHER
                    INFORMATIONItem
                    1
                
                Legal
                    Proceedings
                1Item
                    2
                
                Unregistered
                    Sales of Equity Securities and Use of Proceeds
                13Item
                    3
                
                Defaults
                    Upon Senior Securities
                14Item
                    4
                
                Submission
                    of Matters to a Vote of Security Holders
                14Item
                    5
                
                Other
                    Information
                14Item
                    6
                
                Exhibits
                    and Reports on Form 8K
                14SIGNATURES
                
                
                14





*-
          2
          -*






**INVESTMENT
      ASSOCIATES, INC.**


**(A
      Development Stage Enterprise)**


**BALANCE
          SHEETS**





March
                  31,2007
              
              September
                  30,(unaudited)
              
              2006**ASSETS**CURRENT
                  ASSETSCash
              
              $
              -
              
              $
              457**TOTAL
                  ASSETS**
              
              $
              -
              
              $
              457**LIABILITIES
                  AND STOCKHOLDERS' DEFICIT**CURRENT
                  LIABILITIESChecks
                  in excess of deposits
              
              $
              255
              
              $
              -Accounts
                  payable and accrued liabilities
              
              
              42
              
              
              1,079Indebtedness
                  to related parties
              
              
              2,720
              
              
              24,720Loans
                  payable
              
              
              10,000
              
              
              10,000TOTAL
                  CURRENT LIABILITIES
              
              
              13,017
              
              
              35,799COMMITMENTS
                  AND CONTINGENCIES
              
              
              -
              
              
              -STOCKHOLDERS'
                  DEFICITCommon
                  stock, 25,000,000 shares authorized; $0.001par
                  value; 1,000,000 shares issued and outstanding
              
              
              1,000
              
              
              1,000Additional
                  paid-in capital
              
              
              61,283
              
              
              29,283Accumulated
                  deficit during development stage
              
              
              (75,300
              )
              
              (65,625
              )TOTAL
                  STOCKHOLDERS' DEFICIT
              
              
              (13,017
              )
              
              (35,342
              )**TOTAL
                  LIABILITIES AND STOCKHOLDERS' DEFICIT**
              
              $
              -
              
              $
              457


The
        accompanying condensed notes are an integral part of these interim financial
        statements.




*-
          3
          -*




**INVESTMENT
        ASSOCIATES, INC.**
 **(A
        Development Stage Enterprise)**
 **STATEMENTS
        OF OPERATIONS** 
  FromJuly
                      18,Three
                      Months
                  
                  Three
                      Months
                  
                  Six
                      Months
                  
                  Six
                      Months
                  
                  1997Ended
                  
                  Ended
                  
                  Ended
                  
                  Ended
                  
                  (Inception)
                      toMarch
                      31,
                  
                  March
                      31,
                  
                  March
                      31,
                  
                  March
                      31,
                  
                  March
                      31,2007
                  
                  2006
                  
                  2007
                  
                  2006
                  
                  2007(unaudited)
                  
                  (unaudited)
                  
                  (unaudited)
                  
                  (unaudited)
                  
                  (unaudited)REVENUES
                  
                  $
                  -
                  
                  $
                  -
                  
                  $
                  -
                  
                  $
                  -
                  
                  $
                  -EXPENSESSelling,
                      general and administrative expenses
                  
                  
                  5,509
                  
                  
                  3,472
                  
                  
                  9,674
                  
                  
                  5,056
                  
                  
                  79,077Loss
                      on write-down of note receivable
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  18,679Gain
                      on forgiveness of note payable
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  (22,500
                  )Interest
                      expense
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  44TOTAL
                      EXPENSES
                  
                  
                  5,509
                  
                  
                  3,472
                  
                  
                  9,674
                  
                  
                  5,056
                  
                  
                  75,300LOSS
                      FROM OPERATIONS
                  
                  
                  (5,509
                  )
                  
                  (3,472
                  )
                  
                  (9,674
                  )
                  
                  (5,056
                  )
                  
                  (75,300
                  )LOSS
                      BEFORE TAXES
                  
                  
                  (5,509
                  )
                  
                  (3,472
                  )
                  
                  (9,674
                  )
                  
                  (5,056
                  )
                  
                  (75,300
                  )INCOME
                      TAXES
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -
                  
                  
                  -NET
                      LOSS
                  
                  $
                  (5,509
                  )
                  $
                  (3,472
                  )
                  $
                  (9,674
                  )
                  $
                  (5,056
                  )
                  $
                  (75,300
                  )NET
                      LOSS PER COMMON SHARE,BASIC
                      AND DILUTED
                  
                  $
                  (0.01
                  )
                  $
                  nil
                  
                  $
                  (0.01
                  )
                  $
                  (0.01
                  )WEIGHTED
                      AVERAGE NUMBEROF
                      COMMON SHARES OUTSTANDING,BASIC
                      AND DILUTED
                  
                  
                  1,000,000
                  
                  
                  1,000,000
                  
                  
                  1,000,000
                  
                  
                  1,000,000




The
      accompanying condensed notes are an integral part of these interim financial
      statements.






*-
          4
          -*






**INVESTMENT
      ASSOCIATES, INC.**


**(A
      Development Stage Enterprise)**


**STATEMENTS
      OF CASH FLOWS**






FromJuly
                  18,Six
                  Months
              
              Six
                  Months
              
              1997Ended
              
              Ended
              
              (Inception)
                  toMarch
                  31,
              
              March
                  31,
              
              March
                  31,2007
              
              2006
              
              2007(unaudited)
              
              (unaudited)
              
              (unaudited)**CASH
                  FLOWS FROM OPERATING ACTIVITIES:**Net
                  loss
              
              $
              (9,674
              )
              $
              (5,056
              )
              $
              (75,300
              )Adjustments
                  to reconcile net loss to net cash used in operating
                  activities:
              
              
              
              
              
              
              
              
              -Loss
                  on write-down of note receivable
              
              
              -
              
              
              -
              
              
              18,679Gain
                  on forgiveness note payable
              
              
              -
              
              
              -
              
              
              (22,500
              )Increase
                  (decrease) in checks in excess of deposits
              
              
              255
              
              
              -
              
              
              255Increase
                  (decrease) in accounts payable and accrued
                  liabilities
              
              
              (1,038
              )
              
              (1,499
              )
              
              42Net
                  cash used by operating activities
              
              
              (10,457
              )
              
              (6,555
              )
              
              (78,824
              )**CASH
                  FLOWS PROVIDED BY INVESTING ACTIVITIES:**Issuance
                  of note receivable
              
              
              -
              
              
              -
              
              
              (18,679
              )Net
                  cash used by investing activities
              
              
              -
              
              
              -
              
              
              (18,679
              )**CASH
                  FLOWS PROVIDED BY FINANCING ACTIVITIES:**Issuance
                  of common stock
              
              
              -
              
              
              -
              
              
              1,000Proceeds
                  from issuance of loan payable
              
              
              -
              
              
              -
              
              
              10,000Proceeds
                  from related party advances
              
              
              10,000
              
              
              7,000
              
              
              34,720Proceeds
                  from issuance of note payable
              
              
              -
              
              
              -
              
              
              22,500Capital
                  contributed by an affiliate
              
              
              -
              
              
              -
              
              
              29,283Net
                  cash provided by financing activities
              
              
              10,000
              
              
              7,000
              
              
              97,503**NET
                  INCREASE (DECREASE) IN CASH**
              
              
              (457
              )
              
              445
              
              
              -**CASH,
                  BEGINNING OF PERIOD**
              
              
              457
              
              
              2,258
              
              
              -**CASH,
                  END OF PERIOD**
              
              $
              -
              
              $
              2,703
              
              $
              -**SUPPLEMENTAL
                  CASH FLOW INFORMATION:**Interest
                  paid
              
              $
              -
              
              $
              -
              
              $
              44Income
                  taxes paid
              
              $
              -
              
              $
              -
              
              $
              -**NON-CASH
                  TRANSACTIONS:**1,000,000
                  shares of common stock issued for services
              
              $
              -
              
              $
              -
              
              $
              1,000Cotntributed
                  capital in exchange for related party indebtedness
              
              $
              32,000
              
              $
              -
              
              $
              32,000




The
        accompanying condensed notes are an integral part of these interim financial
        statements.





*-
          5
          -*


**INVESTMENTS
        ASSOCIATES, INC.**
 **(A
        Development Stage Enterprise)**
 **CONDENSED
        NOTES TO THE INTERIM FINANCIAL STATEMENTS**
 **March
        31, 2007**


Investment
        Associates, Inc. (the “Company”) was incorporated, under the laws of Nevada on
        July 18, 1997 to engage in any lawful corporate undertaking, including, but
        not
        limited to, selected mergers and acquisitions. The Company’s business plan is to
        evaluate, structure and complete a merger with, or acquisition of, a privately
        owned corporation.
 
 The
        Company has been in a development stage since its inception on July 18, 1997
        and
        has not realized any revenues from its planned operations. The Company’s year
        end is September ** 30.
 
 **NOTE
        1 - BASIS OF PRESENTATION**
 
 The
        foregoing unaudited interim financial statements have been prepared in
        accordance with generally accepted accounting principles for interim financial
        information and with the instructions to Regulation S-B as promulgated by
        the
        Securities and Exchange Commission. Accordingly, these financial statements
        do
        not include all of the disclosures required by generally accepted accounting
        principles in the United States of America for complete financial statements.
        These unaudited interim financial statements should be read in conjunction
        with
        the audited financial statements for the period ended September 30, 2006.
        In the
        opinion of management, the unaudited interim financial statements furnished
        herein include all adjustments, all of which are of a normal recurring nature,
        necessary for a fair statement of the results for the interim period presented.
        Operating results for the six-month period ending March 31, 2007 are not
        necessarily indicative of the results that may be expected for the year ending
        September 30, 2007.
 
 The
        Company is a “blank check” company. It was organized to evaluate, structure and
        complete a merger with, or acquisition of, a privately owned
        corporation.
 
 
 **NOTE
        2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**
 
 Going
        Concern
 The
        accompanying financial statements have been prepared on a going concern basis,
        which contemplates the realization of assets and the satisfaction of liabilities
        in the normal course of business. As shown in the accompanying financial
        statements, the Company has no revenues, minimal cash, and recurring losses
        since inception. These factors, among others, may indicate that the Company
        will
        be unable to continue as a going concern for a reasonable period of
        time.
 
  *-
            6
            -*
  **INVESTMENTS
          ASSOCIATES, INC.**
 **(A
          Development Stage Enterprise)**
 **CONDENSED
          NOTES TO THE INTERIM FINANCIAL STATEMENTS**
 **March
          31, 2007**
 
 
 The
        financial statements do not include any adjustments relating to the
        recoverability and classification of liabilities that might be necessary
        should
        the Company be unable to continue as a going concern. Management’s plans are to
        engage in evaluating, structuring, and completing a merger with, or acquisition
        of, a privately owned corporation. These plans, if successful, will mitigate
        the
        factors which raise substantial doubt about the Company’s ability to continue as
        a going concern. The Company’s continuation as a going concern is dependent upon
        continuing capital contributions from an affiliate to meet its obligations
        on a
        timely basis, consummating a business combination with an operating company,
        and
        ultimately attaining profitability. There is no assurance that the affiliate
        will continue to provide capital to the Company or that the Company can identify
        a target company and consummate a business combination. The financial statements
        do not include any adjustments that might result from the outcome of this
        uncertainty.
 
 Use
        of
        Estimates
 The
        process of preparing financial statements in conformity with accounting
        principles generally accepted in the United States of America requires the
        use
        of estimates and assumptions regarding certain types of assets, liabilities,
        revenues, and expenses. Such estimates primarily relate to unsettled
        transactions and events as of the date of the financial statements. Accordingly,
        upon settlement, actual results may differ from estimated amounts.
 
 
 **NOTE
        3 - LOAN PAYABLE**
 
 During
        the year ended September 30, 2002, an unrelated third party made an unsecured,
        non-interest bearing loan to the Company for working capital. The loan remains
        unpaid at March 31, 2007 and is due on demand.
 
 
 **NOTE
        4 - RELATED PARTY TRANSACTIONS**
 
 The
        Company maintains a mailing address at the offices of RD Capital, Inc. (“RD
        Capital”), an affiliate under common control. At this time, the Company has no
        need for an office.
 
 RD
        Capital has assumed responsibility for funding the Company’s limited operations.
        The Company accounts for such proceeds as contributed capital or as indebtedness
        to a related party. During the year ended September 30, 2004, RD Capital
        made
        contributions to the Company totaling $6,092. No capital contributions were
        made
        during the year ended September 30, 2005 and 2006. Through March 31, 2007,
        RD
        Capital has contributed a total of $61,283 on behalf of the stockholders,
        which
        is included in the accompanying financial statements as “additional paid-in
        capital”. RD Capital does not expect to be repaid for its capital contributions
        to the Company.
 
  *-
            7
            -*
  **INVESTMENTS
        ASSOCIATES, INC.**
 **(A
        Development Stage Enterprise)**
 **CONDENSED
        NOTES TO THE INTERIM FINANCIAL STATEMENTS**
 **March
        31, 2007**
 
 
 During
        the year ended September 30, 2001, Strathmore Minerals Corp, an affiliate
        corporation under common control, loaned $2,720 to the Company. During the
        year
        ended September 30, 2006 and 2005, RD Capital loaned $13,000 and $9,000,
        respectively, to the Company. During the six months ended March 31, 2007,
        RD
        Capital loaned $10,000 to the Company. During the period ended March 31,
        2007,
        pursuant to an agreement with RD Capital, this indebtedness of $32,000 to
        RD
        Capital has been reclassified as “paid-in capital”. This indebtedness is
        non-interest bearing, not collateralized and due on demand. At March 31,
        2007,
        the Company owed $2,720 to related parties.
 
 **NOTE
        5 - COMMON STOCK**
 
 During
        the year ended September 30, 1997, the Company issued 1,000,000 shares of
        common
        stock in exchange for services. There have been no issuances of the Company’s
        common stock after September 30, 1997.


*-
          8
          -*




**Item 2- Plan
        of Operation**


**PLAN
      OF OPERATIONS**





The
      following discussion of the plan of operations of the Company should be read
      in
      conjunction with the financial statements and the related notes thereto included
      elsewhere in this quarterly report for the six months ended March 31, 2007.
      This
      quarterly report contains certain forward-looking statements and the Company's
      future operation results could differ materially from those discussed
      herein.





We
      intend
      to seek to acquire assets or shares of an entity actively engaged in a business
      that generates revenues, in exchange for its securities. We have not identified
      a particular acquisition target and have not entered into any negotiations
      regarding an acquisition. None of our officers, directors, promoters or
      affiliates have engaged in any preliminary contact or discussions with any
      representative of any other company regarding the possibility of an acquisition
      or merger with us as of the date of this quarterly report.





Depending
      upon the nature of the relevant business opportunity and the applicable state
      statutes governing how the transaction is structured, the Company's Board of
      Directors expects that it will provide our shareholders with complete disclosure
      documentation concerning a potential business opportunity and the structure
      of
      the proposed business combination prior to consummation. Disclosure is expected
      to be in the form of a proxy or information statement, in addition to the
      post-effective amendment.





While
      any
      disclosure must include audited financial statements of the target entity,
      we
      cannot assure you that such audited financial statements will be available.
      As
      part of the negotiation process, the Board of Directors does intend to obtain
      certain assurances of value, including statements of assets and liabilities,
      material contracts, accounts receivable statements, or other indicia of the
      target entity's condition prior to consummating a transaction, with further
      assurances that an audited statement would be provided prior to execution of
      a
      merger or acquisition agreement. Closing documents will include representations
      that the value of the assets transferred will not materially differ from the
      representations included in the closing documents, or the transaction will
      be
      voidable.





Due
      to
      our intent to remain a shell corporation until a merger or acquisition candidate
      is identified, it is anticipated that its cash requirements shall be minimal,
      and that all necessary capital, to the extent required, will be provided by
      the
      directors or officers. We do not anticipate that we will have to raise capital
      in the next twelve months. We also do not expect to acquire any plant or
      significant equipment.





We
      have
      not and do not intend to enter into, any arrangement, agreement or understanding
      with non-management shareholders allowing non-management shareholders to
      directly or indirectly participate in or influence our management of the
      Company. As a result, management is in a position to elect a majority of the
      directors and to control our affairs.





We
      have
      no full time employees. Our President and Secretary have agreed to allocate
      a
      portion of their time to our activities, without compensation. These officers
      anticipate that our business plan can be implemented by their devoting
      approximately five (5) hours each per month to our business affairs and,
      consequently, conflicts of interest may arise with respect to their limited
      time
      commitment. We do not expect any significant changes in the number of employees.
      See "Management."





Our
      officers and directors may become involved with other companies who have a
      business purpose similar to ours. As a result, potential conflicts of interest
      may arise in the future. If a conflict does arise and an officer or director
      is
      presented with business opportunities under circumstances where there may be
      a
      doubt as to whether the opportunity should belong to the Company or another
      "blank check" company they are affiliated with, they will disclose the
      opportunity to all the companies. If a situation arises where more than one
      company desires to merge with or acquire that target company and the principals
      of the proposed target company have no preference as to which company will
      merge
      with or acquire the target company, the company that first filed a registration
      statement with the Securities and Exchange Commission will be entitled to
      proceed with the proposed transaction. See "Risk Factors - Affiliation With
      Other "Blank Check" Companies."










*-
            9
            -*






General
      Business Plan


Our
      purpose is to seek, investigate and, if investigation warrants, acquire an
      interest in business opportunities presented to it by persons or firms that
      desire to seek the perceived advantages of an Exchange Act registered
      corporation. We will not restrict our search to any specific business, industry,
      or geographical location and we may participate in a business venture of
      virtually any kind or nature. This discussion of the proposed business is
      purposefully general and is not meant to restrict our discretion to search
      for
      and enter into potential business opportunities. Management anticipates that
      it
      may be able to participate in only one potential business venture because we
      have nominal assets and limited financial resources. This lack of
      diversification should be considered a substantial risk to our shareholders
      because it will not permit us to offset potential losses from one venture
      against gains from another.





We
      may
      seek a business opportunity with entities that have recently commenced
      operations, or that wish to utilize the public marketplace in order to raise
      additional capital in order to expand into new products or markets, to develop
      a
      new product or service, or for other corporate purposes. We may acquire assets
      and establish wholly owned subsidiaries in various businesses or acquire
      existing businesses as subsidiaries.





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





We
      have,
      and will continue to have, no capital to provide the owners of business
      opportunities with any significant cash or other assets. However, management
      believes we will be able to offer owners of acquisition candidates the
      opportunity to acquire a controlling ownership interest in a publicly registered
      company without incurring the cost and time required to conduct an initial
      public offering. The owners of the business opportunities will, however, incur
      significant legal and accounting costs in connection with acquisition of a
      business opportunity, including the costs of preparing Form 8-K's, 10-KSB's,
      or
      10-QSB's, agreements and related reports and documents. The '34 Act specifically
      requires that any merger or acquisition candidate comply with all applicable
      reporting requirements, which include providing audited financial statements
      to
      be included within the numerous filings relevant to complying with the `34
      Act.
      Nevertheless, the officers and directors of the Company have not conducted
      market research and are not aware of statistical data that would support the
      perceived benefits of a merger or acquisition transaction for the owners of
      a
      business opportunity.





The
      analysis of new business opportunities will be undertaken by our officers and
      directors, none of whom is a professional business analyst. Management intends
      to concentrate on identifying preliminary prospective business opportunities
      that may be brought to our attention through present associations of our
      officers and directors, or by our shareholders. In analyzing prospective
      business opportunities, management will consider:





-
            the
                available technical, financial and managerial
                resources;


-
            working
                capital and other financial
                requirements;


-
            history
                of operations, if any;


-
            prospects
                for the future;


-
            nature
                of present and expected
                competition;


-
            the
                quality and experience of management services that may be available
                and
                the depth of that management;


-
            the
                potential for further research, development, or
                exploration;


-
            specific
                risk factors not now foreseeable but could be anticipated to impact
                our
                proposed activities;


-
            the
                potential for growth or expansion;


-
            the
                potential for profit;


-
            the
                perceived public recognition of acceptance of products, services,
                or
                trades;


-
            name
                identification; and


-
            other
                relevant factors.





*-
            10
            -*











Our
      officers and directors expect to meet personally with management and key
      personnel of the business opportunity as part of their "due diligence"
      investigation. To the extent possible, the Company intends to utilize written
      reports and personal investigations to evaluate the above factors. We will
      not
      acquire or merge with any company that cannot provide audited financial
      statements within a reasonable period of time after closing of the proposed
      transaction.





Our
      management, while probably not especially experienced in matters relating to
      the
      prospective new business of the Company, shall rely upon their own efforts
      and,
      to a much lesser extent, the efforts of our shareholders, in accomplishing
      our
      business purposes. We do not anticipate that any outside consultants or
      advisors, except for our legal counsel and accountants, will be utilized by
      us
      to accomplish our business purposes. However, if we do retain an outside
      consultant or advisor, any cash fee will be paid by the prospective
      merger/acquisition candidate, as we have no cash assets. We have no contracts
      or
      agreements with any outside consultants and none are contemplated.





We
      will
      not restrict our search for any specific kind of firms, and may acquire a
      venture that is in its preliminary or development stage or is already operating.
      We cannot predict at this time the status of any business in which we may become
      engaged, because the business may need to seek additional capital, may desire
      to
      have its shares publicly traded, or may seek other perceived advantages that
      we
      may offer. Furthermore, we do not intend to seek capital to finance the
      operation of any acquired business opportunity until we have successfully
      consummated a merger or acquisition.





We
      anticipate that we will incur nominal expenses in the implementation of its
      business plan. Because we has no capital to pay these anticipated expenses,
      present management will pay these charges with their personal funds, as interest
      free loans, for a minimum of twelve months from the date of this quarterly
      report. If additional funding is necessary, management and or shareholders
      will
      continue to provide capital or arrange for additional outside funding. However,
      the only opportunity that management has to have these loans repaid will be
      from
      a prospective merger or acquisition candidate. Management has no agreements
      with
      us that would impede or prevent consummation of a proposed transaction. We
      cannot assure, however, that management will continue to provide capital
      indefinitely if a merger candidate cannot be found. If a merger candidate cannot
      be found in a reasonable period of time, management may be required reconsider
      its business strategy, which could result in our dissolution.





Acquisition
      of Opportunities





In
      implementing a structure for a particular business acquisition, we may become
      a
      party to a merger, consolidation, reorganization, joint venture, or licensing
      agreement with another corporation or entity. It may also acquire stock or
      assets of an existing business. On the consummation of a transaction, it is
      probable that our present management and shareholders will no longer be in
      control. In addition, our directors may, as part of the terms of the acquisition
      transaction, resign and be replaced by new directors without a vote of our
      shareholders. Furthermore, management may negotiate or consent to the purchase
      of all or a portion of our stock. Any terms of sale of the shares presently
      held
      by officers and/or directors will be also afforded to all other shareholders
      on
      similar terms and conditions. Any and all sales will only be made in compliance
      with the securities laws of the United States and any applicable
      state.





While
      the
      actual terms of a transaction that management may not be a party to cannot
      be
      predicted, it may be expected that the parties to the business transaction
      will
      find it desirable to avoid the creation of a taxable event and thereby structure
      the acquisition in a so-called "tax-free" reorganization under Sections
      368(a)(1) or 351 of the Internal Revenue Code (the "Code"). In order to obtain
      tax-free treatment under the Code, it may be necessary for the owners of the
      acquired business to own 80% or more of the voting stock of the surviving
      entity. In that event, the shareholders of the Company would retain 20% or
      less
      of the issued and outstanding shares of the surviving entity, which would result
      in significant dilution in the equity of the shareholders.








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As
      part
      of the "due diligence" investigation, our officers and directors will meet
      personally with management and key personnel, may visit and inspect material
      facilities, obtain independent analysis of verification of certain information
      provided, check references of management and key personnel, and take other
      reasonable investigative measures to the extent of our limited financial
      resources and management expertise. How we will participate in an opportunity
      will depend on the nature of the opportunity, the respective needs and desires
      of the parties, the management of the target company and our relative
      negotiation strength.





With
      respect to any merger or acquisition, negotiations with target company
      management are expected to focus on the percentage of our Company that the
      target company shareholders would acquire in exchange for all of their
      shareholdings in the target company. Depending upon, among other things, the
      target company's assets and liabilities, our shareholders will probably hold
      a
      substantially lesser percentage ownership interest following any merger or
      acquisition. The percentage ownership may be subject to significant reduction
      in
      the event we acquire a company with substantial assets. Any merger or
      acquisition effected by us can be expected to have a significant dilutive effect
      on the percentage of shares held by our then shareholders.





We
      will
      participate in a business opportunity only after the negotiation and execution
      of appropriate written agreements. Although we cannot predict the terms of
      the
      agreements, generally the agreements will require some specific representations
      and warranties by all of the parties, will specify certain events of default,
      will detail the terms of closing and the conditions that must be satisfied
      by
      each of the parties prior to and after the closing, will outline the manner
      of
      bearing costs, including costs associated with our attorneys and accountants,
      will set forth remedies on default and will include miscellaneous other
      terms.





As
      stated
      previously, we will not acquire or merge with any entity that cannot provide
      independent audited financial statements concurrent with the closing of the
      proposed transaction. We are subject to the reporting requirements of the '34
      Act. Included in these requirements is our affirmative duty to file independent
      audited financial statements as part of its Form 8-K to be filed with the
      Securities and Exchange Commission upon consummation of a merger or acquisition,
      as well as our audited financial statements included in our annual report on
      Form 10-K (or 10-KSB, as applicable) and quarterly reports on Form 10-Q (or
      10-QSB, as applicable). If the audited financial statements are not available
      at
      closing, or if the audited financial statements provided do not conform to
      the
      representations made by the candidate to be acquired in the closing documents,
      the closing documents will provide that the proposed transaction will be
      voidable at the discretion of our present management. If the transaction is
      voided, the agreement will also contain a provision providing for the
      acquisition entity to reimburse us for all costs associated with the proposed
      transaction.





Competition





We
      will
      remain an insignificant participant among the firms that engage in the
      acquisition of business opportunities. There are many established venture
      capital and financial concerns that have significantly greater financial and
      personnel resources and technical expertise than we do. In view of our combined
      extremely limited financial resources and limited management availability,
      we
      will continue to be at a significant competitive disadvantage compared to our
      competitors.








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**Item
      3 - Controls and Procedures**





**(a)**  **Evaluation
      of disclosure controls and procedures.**





As
      required by Rule 13a-15 under the Securities Exchange Act of 1934, as amended
      (the "Exchange Act"), the Company carried out an evaluation under the
      supervision and with the participation of the Company's management, including
      the President and Chief Executive Officer and the Chief Financial Officer,
      of
      the effectiveness of the Company's disclosure controls and procedures as of
      March 31, 2007. In designing and evaluating the Company's disclosure controls
      and procedures, the Company and its management recognize that there are inherent
      limitations to the effectiveness of any system of disclosure controls and
      procedures, including the possibility of human error and the circumvention
      or
      overriding of the controls and procedures. Accordingly, even effective
      disclosure controls and procedures can only provide reasonable assurance of
      achieving their desired control objectives. Additionally, in evaluating and
      implementing possible controls and procedures, the Company's management was
      required to apply its reasonable judgment. Furthermore, in the course of this
      evaluation, management considered certain internal control areas, in which
      we
      have made and are continuing to make changes to improve and enhance controls.
      Based upon the required evaluation, the Chief Executive Officer and the Chief
      Financial Officer concluded that as of March 31, 2007, the Company's disclosure
      controls and procedures were effective (at the "reasonable assurance" level
      mentioned above) to ensure that information required to be disclosed by the
      Company in the reports it files or submits under the Exchange Act is recorded,
      processed, summarized and reported within the time periods specified in the
      Securities and Exchange Commission's rules and forms.





From
      time-to-time, the Company and its management have conducted and will continue
      to
      conduct further reviews and, from time to time put in place additional
      documentation, of the Company's disclosure controls and procedures, as well
      as
      its internal control over financial reporting. The Company may from time to
      time
      make changes aimed at enhancing their effectiveness, as well as changes aimed
      at
      ensuring that the Company's systems evolve with, and meet the needs of, the
      Company's business. These changes may include changes necessary or desirable
      to
      address recommendations of the Company's management, its counsel and/or its
      independent auditors, including any recommendations of its independent auditors
      arising out of their audits and reviews of the Company's financial statements.
      These changes may include changes to the Company's own systems, as well as
      to
      the systems of businesses that the Company has acquired or that the Company
      may
      acquire in the future and will, if made, be intended to enhance the
      effectiveness of the Company's controls and procedures. The Company is also
      continually striving to improve its management and operational efficiency and
      the Company expects that its efforts in that regard will from time to time
      directly or indirectly affect the Company's disclosure controls and procedures,
      as well as the Company's internal control over financial reporting.





**(b)**  **Changes
      in internal controls.**





There
      were no significant changes in the Company's internal controls or other factors
      that could significantly affect the Company's internal controls subsequent
      to
      the date of their evaluation.








**PART
      II**


**OTHER
      INFORMATION**





Item
      1.   LEGAL
      PROCEEDINGS





None








Item
      2   UNREGISTERED
      SALES OF EQUITY SECURITIES AND USE OF PROCEEDS





None





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Item
      3   DEFAULTS
      UPON SENIOR SECURITIES





None





Item
      4   SUBMISSION
      OF MATTERS TO A VOTE OF SECURITY HOLDERS





None





Item
      5   OTHER
      INFORMATION





None





Item
      6   EXHIBITS
      AND REPORTS ON FORM 8-K





(a)  Exhibits





31.1  Section
      302 Certification of Chief Executive Officer


31.2  Section
      302 Certification of Chief Financial Officer


32  Section
      906 Certification








(b)  Reports
      on Form 8-K





None


**SIGNATURES**





In
      accordance with the requirements of the Exchange Act, the registrant caused
      this
      report to be signed on its behalf by the undersigned, thereunto duly
      authorized.







**INVESTMENT ASSOCIATES, INC.**Dated:
              May 14, 2007
            Per:
            /s/ Robert
              HemmerlingRobert
                Hemmerling,
              C.F.O.,
                Secretary, Treasurer and Director


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