UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549

FORM 10-KSB/A
ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended January 31, 2006

Advanced Technologies Group, LTD
(Exact name of registrant as specified in its charter) 

 Nevada 0-30987 80-0987213
 (State of (Commission (I.R.S. Employer
Incorporation) File Number) Identification Number)

921 Bergen Avenue, Suite 405, Jersey City, NJ 07306
(Address of Principal Executive Offices Including Zip Code)

(201)-680-7142
(Registrant's Telephone Number)

Securities registered pursuant to Section 12(b) of the Act: None

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

Common Stock $.0001 par value
(Title of Class)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (Sec. 229.405 of this chapter) is not contained herein, and will not be contained, to the best of Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K [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

The aggregate market value of voting stock held by Registrant's non-affiliates on May 1, 2006 was $0.

The registrant's gross revenues for its most recent fiscal year were $951,644.

Number of shares outstanding of each of the registrant's classes of common equity as of January 31, 2006 is, 17,263,140. There is no public market for Registrant's securities at the date of this Report.

FORM 10-KSB/A
JANUARY 31, 2006
ADVANCED TECHNOLOGIES GROUP, LTD.

TABLE OF CONTENTS 

FORWARD LOOKING STATEMENTS 1

PART I

 ITEM 1. Description of Business 1
 ITEM 2. Description of Property 11
 ITEM 3. Legal Proceedings 11
 ITEM 4. Submission of Matters to a Vote of Security Holders 11

PART II

 ITEM 5. Market for Registrant's Common Equity and Related 11
 Stockholder Matters
 ITEM 6. Management's Discussion and Analysis of Financial 11
 Condition and Results of Operations
 ITEM 7. Financial Statements 14
 ITEM 8. Changes in and Disagreements with Accountants 14

PART III

 ITEM 9. Directors, Executive Officers, Promoters and Control Persons 15
 ITEM 10. Executive Compensation 21
 ITEM 11. Security Ownership of Certain Beneficial Owners
 and Management 21
 ITEM 12. Certain Relationships and Related Transactions 22
 ITEM 13. Exhibits and Reports on Form 8-K 22

Signatures 23

Independent Auditor's Report F-1

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FORWARD LOOKING STATEMENTS

Some of the information contained in this Report may constitute forward-looking statements or statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations and projections about future events. The words "estimate", "plan", "intend", "expect", "anticipate" and similar expressions are intended to identify forward-looking statements which involve, and are subject to, known and unknown risks, uncertainties and other factors which could cause the Company's actual results, financial or operating performance, or achievements to differ from future results, financial or operating performance, or achievements expressed or implied by such forward-looking statements. Projections and assumptions contained and expressed herein were reasonably based on information available to the Company at the time so furnished and as of the date of this filing. All such projections and assumptions are subject to significant uncertainties and contingencies, many of which are beyond the Company's control, and no assurance can be given that the projections will be realized. Potential investors are cautioned not to place undue reliance on any such forward-looking statements, which speak only as of the date hereof. The Company undertakes no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

ITEM 1. DESCRIPTION OF BUSINESS

(A) CORPORATE HISTORY

Advanced Technologies Group, Ltd. (the Company) was incorporated in the State of Nevada in February 2000. In January 2001, the Company purchased 100% of the issued and outstanding shares of FX3000, Inc. (formerly Oxford Global Network, Ltd.), a Delaware corporation, the designer of the FX3000 software program. The FX3000 software program is a financial real time quote and money management platform for use by independent foreign currency traders. In March 2002, the Company transferred its FX3000 software program to FX Direct Dealer, LLC, a joint venture company that will market the FX3000 software program. The Company received a 25% interest in the joint venture in return for the transfer. The remaining 75% of the joint venture is owned by Tradition, N.A., a subsidiary of Compagnie Financiere Tradition, a major Swiss-based financial company. The un-depreciated cost of the FX 3000 program at the date of the transfer was $1,670,485. However, as of January 31, 2006, the Company presently carries the value of its investment in the joint venture at $-0-.

At that point, the Company ceased all its efforts to directly market the FX3000 software and redirected its efforts to the acquisition, development and commercialization of other types of technology intended for the e-commerce marketplace.

During October 2001, the Company acquired 100% of the issued and outstanding common stock of Luxury Lounge Inc. ("Luxury") in exchange for 7,918,565 shares of its common stock. Luxury, at the time of acquisition, operated an on-line interactive web site specializing in selling jewelry and other luxury appliances at a discount to the retail and wholesale consumer. In addition, Luxury was also in the process of developing several ancillary technologies designed to provide on-line marketers with analytical information relating to the effectiveness of their on-line marketing techniques as well as allowing them to offer additional services to their customers. The Company believes that these technologies, (known as PromotionStat and Promote4Free) when properly developed, will have the potential for generating significant revenues and profits for the Company. The

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PromotionStat program will allow on-line retailers and advertisers to verify customers and categorize the patrons of on-line retail stores. Due to economic conditions, the Company terminated Luxury's on-line marketing operations and devoted all of its efforts and resources to complete the development and initiate the commercialization of the PromotionStat and Promote4Free technologies.

The Company, through its wholly owned subsidiaries, seeks to generate revenue through its investment in FX Direct Dealer and the PromotionStat e-commerce advertising screening platform software. To date, limited revenues ($951,644 in fiscal 2006, compared to $494,075 in fiscal 2005) have been generated from the Company's continuous software development and maintenance of FX Direct Dealer platform and no revenues have resulted from the PromotionStat e-commerce software platform during fiscal 2006. Neither the Company nor its predecessor has been involved in a bankruptcy, receivership or similar proceeding.

(B) BUSINESS OF REGISTRANT GENERAL

The Company's business centers around the development and/or acquisition of new technologies that in management's opinion provide a novel or significantly improved methodology to solve existing problems, meet current demands among business and which have the potential for commercialization. Initially, management has elected to concentrate on technologies within the developing e-commerce marketplace.

I. THE FX3000 SYSTEM

The Company's first venture after its formation was development of the patent pending, Internet-based FX3000 software system, a Java-based online foreign exchange dealing system. This system created an on-line foreign currency exchange ("Forex") trading service that offers a complete and technologically superior software platform that allows the retail-level foreign exchange clients access to 24-hour, commission-free foreign exchange dealing, using inter-bank liquidity and efficiencies. As mentioned above, in 2002 the Company reached an agreement with Tradition N.A., a subsidiary of Compagnie Financiere Tradition, a major international financial institution, to implement FX3000 on a commercial scale through a joint venture with the Company.
Under the joint venture, the Company assigned all of the FX3000 technology to the new joint venture company with Tradition NA, which assumed all administrative, funding and marketing responsibilities of commercializing the FX3000 system. Management believes that as the joint venture continues to develop its commercial operations this will be the leading source of revenues for the Company over the foreseeable future. As such, in order to provide a better understanding of the potential of this new technology, following is a brief discussion of the Forex markets and how the FX3000 system operates.

With the advent of Internet communications and related Web technologies, the Company perceived a growing demand for faster, cheaper and more efficient foreign currency exchange trade executions. The present Forex market is estimated to be at $1.5 Trillion in currencies traded every day. Most Forex trading is done at the wholesale level amongst brokers and major banks via private or vendor-supplied computer networks. The availability of Internet technologies is increasing the availability of lower-cost trading opportunities at the retail level for money managers, sophisticated high net worth traders, international corporations and small and medium size institutions. Individual investors are also being drawn to on-line Forex trading in increasing numbers, further increasing the pool of prospective trading participants.

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The Company's FX3000 technology was designed to serve as a gateway to those inside Inter-bank markets. This technology ensures that all trades are executed as soon as they are received at openly posted executable prices that closely match those of the foreign exchange Inter-bank market by aggregating the trades as they are received and, in turn, executing them in the Inter-bank markets. This allows individual traders and investors to receive the benefits of the massive liquidity and tight quote spreads available in the Inter-bank markets, and allows those markets in turn to service this retail sector without having to manage individual retail accounts.

The Company initially developed its on-line trading environment to include real-time dealing quotes, charting, technical analysis tools and news all in one comprehensive product. FX3000 fully integrates the client, dealer, back office and System Administrator functions. Product features include high-speed execution of client orders and the ability to monitor in real time margin availability, net exposure and profit and loss on all open positions. Following establishment of the joint venture, the Company continued upgrading the FX3000 system to enable the system to better fulfill its market mission and meet the performance criteria established by its joint venture partner. Commercial operation of the upgraded FX3000 software platform began, on a limited basis, during calendar year 2003 and have continued to develop and evolve through 2006.

II. ADDITIONAL TECHNOLOGIES UNDER DEVELOPMENT

GENERAL

Through the acquisition of Luxury, the Company acquired several new technologies related to the e-commerce markets which management believes offer an exceptional commercial opportunity to the Company. Principal among these new technologies are PROMOTIONSTAT and PROMOTE4FREE. Both of these technologies have been designed to meet the most basic problems that have resulted in the loss of confidence in Internet-based advertising of products and services to consumers. Given the widespread agreement that Internet marketing is, and will continue to be, a mainstay of how consumers will purchase goods and services in the future, management believes that a critical need exists and will continue to grow for methods to improve the success and viability of Internet-based advertising.

PROMOTIONSTAT AND PROMOTE4FREE TECHNOLOGIES

BACKGROUND: THE INTERNET MARKETPLACE

In less than a decade, Internet-based electronic commerce, or e-commerce, has emerged as the fastest growing factor in the creation of new wealth and overall economic activity in the United States. Additionally, it seems clear that the e-commerce phenomenon is well on its way to redefining how the entire world does business. The trend, say analysts, is not only being driven by the arrival of new consumer users, but also will be spurred by the increasing confidence shown by the business sector in Internet-based commerce. Companies in virtually every market sector and industry must now determine how to develop innovative business strategies to remain competitive in the digital marketplace. Although it is still early, one thing does seem certain: those who make the commitment to integrate e-commerce as a mainstream element in their business practices within and between companies are the ones most likely to wind up on top.

The advertising market as a whole is characterized by the fact that it is difficult to measure, evaluate or analyze the results of a specific ads' effectiveness. For instance the effectiveness of an ad in the newspaper or

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magazine is related to the amount of purchases or subscriptions of that publication which is clearly a poor measurement. The effectiveness of an ad on television is typically measured by the amount of viewers during a specific airing of an ad, which is calculated by an independent company who cannot verify how effective the ad was in producing results for the advertiser. With the advent of the Internet measuring the effectiveness of ads became somewhat simpler. A visitor may click on a banner or link of an advertiser and wind up on their web site. It is sufficient to place a counter on the advertiser's web site to determine the amount of visitors to that site. It seems simple at first glance. However, when a site receives a visitor, a company has no way of knowing whether a visitor was accidentally routed there, found the site through a search engine or came because of an offer by the advertising company. The increased number of visitors to a site may be due to a variety of reasons besides advertising including the possibility that the numbers were inflated by technological means. Most importantly, if a company advertises in more than one location, it is difficult to determine which ad brought more visitors. Consequently, a company may not be in a position to determine which advertising strategy is most effective in promoting its products or services.

Because it is very difficult to measure and predict the effectiveness of a specific ad placement, a company may continue spending a great sum of money on advertising based on inaccurate data and assumptions. In essence, a company may be spending money on advertising that does not work, which creates a dilemma. How can a company figure out how to budget advertising dollars correctly and allocate money to advertising sources that will lead to profitability when there is no way to measure advertising effectiveness? Presently, there are two basic methods to address this issue on the Internet:

1. SERVER LOG FILE ANALYSIS. This type of analysis can be conducted either online or offline via a company's Internet Service Provider or by means of software that is installed on the server. However this information does not allow for a direct tracing or analysis of which advertising or promotional source brought the product request or sale. Additionally there is no way to track and analyze purchased banner/logo impressions placed on other web sites. Basically, this method does provide a means to determine how many unique visitors resulted and what these visitors did when they visited the web site.
2. BANNER IMPRESSIONS ANALYSIS. Such analysis typically includes the amount of impressions, list of web pages showing this impression, date of the impression, CTR of a particular banner or logo, etc. However, none of the companies offering this type of analysis follow the visitor after the click and have no means to determine which product was of most interest to a particular visitor directed to a web site from a particular advertising source. If a company had access to such information it would be able to conduct a marketing research study for a particular group of visitors. A company would also be able to determine the efficiency of a particular advertising and promotional campaign in providing real traffic and interested consumers.

Clearly, existing methodology does not meet the challenge nor provide the information necessary to structure an effective advertising campaign. It was within this environment that management turned it's attention to developing a new approach aimed at assisting E-Businesses by helping them become more profitable. The resulting technology has been carefully structured to provide meaningful information to a company and foster the biggest "bang for the buck." The result was development of the PromotionStat technology.

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PROMOTIONSTAT, INC.

The PromotionStat technology is a statistical and analytical traffic-monitoring tool designed to help marketing executives monitor the effectiveness of every dollar spent on advertising and promotions as well as utilize a free promotional tool at a favorable exchange ratio. The PromotionStat system tracks visitors' pre and post click activities while identifying what visitors came from which advertisements or links. With PromotionStat's Internet Advertising Rating System, a web site will be able to identify and rate their advertising sources and find out which ads are successful. In essence PromotionStat is capable of reporting and separating visitors from different advertising vehicles and tracking their behavior once they get there. This type of analysis will allow companies to allocate their advertising budget appropriately and prevent them from spending money on ads that are costly and inefficient.

The PromotionStat system is designed to analyze the effectiveness of advertising and promotional campaigns of web sites. This system keeps track of visitors via a series of invisible data collectors placed within individual pages of the web site. An advertiser will be able to identify visitors by the various advertising companies that directed them to their site as well as keep track of both the amount of visitors and their level of interest in the advertiser's products or services. The system calculates the percentage of visitors who looked at the home page versus those who continued browsing other internal pages. In this way a company will be able to determine which advertising company is more effective and whether it is worthwhile to continue utilizing their services.

In addition to finding visitors with high "targetability", the PromotionStat technology is able to record and analyze detailed information regarding visitors. This innovative screening system allows web owners to track and identify the referring source of their visitors, calculate the amount of unique visitors on a daily basis, describe the nature and dynamics of visitor activity on a web site and much more. PromotionStat also has a built in mechanism that can detect artificially inflated traffic, which is unfortunately a common practice on the Internet as web sites are paying "per click". This will help web owners eliminate dishonest promoters that employ such tactics.

A WORKING EXAMPLE OF THE BENEFITS OF THE PROMOTIONSTAT SYSTEM

To best understand the usefulness of the PromotionStat system it may be helpful to track a hypothetical advertising campaign by a company using the Company's system. Assume that Company A paid for 10,000 banner impressions of its product banner to SomeAdvertiser.com. According to the contract with SomeAdvertiser.com., Company A's banner is supposed to be placed on a particular page with similar products and information. So Company A should expect a well-targeted audience to visit its online store. In order to determine the efficiency of its advertising dollars, the PromotionStat system can first determine whether Company A's banner was in fact shown 10,000 times as promised and whether it was shown on the requested page.The PromotionStat System can also be used by Company A to provide:

* Real traffic on the pages of the ad promoter and compare those numbers with the numbers promised;
* Efficiency of Company A's banner based on the CTR so that Company A may make effective modifications to its advertising.

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* By utilizing a special filtering feature in the PromotionStat reporting system, Company A can input the special reference number assigned SomeAdvertiser.com and receive the actual number of unique visitors that came from their web page daily.
* Company A can receive detailed information about these visitors including date and time of their visit, where they came from, who referred them, their IP number and the geographic region they are from.
* Company A can receive information regarding which pages were visited, which product, department or category was of most interest and which resulted in actual sales for each day of the week broken down by referral source or tracked on an individual basis.

What is the benefit derived from all of this information provide to Company A? If visitors do not leave the web site after clicking on the first page this will confirm that Company A's impressions are well targeted and not inflated artificially. Further, Company A can use this information to study product demand for a specific product type, product category or department. This provides management with a powerful marketing research tool that will allow Company A to change product offerings to meet market demand. Finally Company A can conduct a final analysis of the efficiency of the money spent on advertising and promotions and compare the amount spent on the 10,000 impressions with the amount of demand or sales generated.

PROMOTE4FREE, INC.

PromotionStat is not limited to providing traffic monitoring tools that measure advertising effectiveness as it works in conjunction with a free promotional service called Promote4Free, that will allow e-commerce companies to decrease their advertising spending and increase market presence simultaneously. One of the most effective methods of web site promotion is to join a banner exchange network that provides a web site access to showing its banner in exchange for showing other members' banners on their web site. Most existing banner exchange networks have an exchange ratio of 2:1, which means that for every one showing of a banner the client must show the banner of another member twice. This ratio is not that effective in bringing traffic as accumulating showings, or "points," at this rate, becomes difficult.

Promote4Free is a banner exchange system that is intended to provide a higher exchange rate of 4:3, allowing for three points to accumulate in the member's account for every four showings of the banner of another. In addition to a favorable exchange ratio, Promote4Free provides broad and detailed statistical information regarding banner showings and allows members complete control of their banner campaigns and point distribution. Promote4Free has a built in fraud protection system that protects members from dishonest practices of other members. This innovative technology does not presently exist in any other banner exchange network program on the Internet.

By combining the innovative services offered by PromotionStat with the advantageous services offered by Promote4Free, management believes that the Company will become a leader in restoring confidence in Internet advertising and making advertising online profitable. Promote4Free and PromotionStat are two innovative software systems that are designed to address an existing basic need of E-Businesses of today and strive to promote web sites efficiently and effectively while reducing advertising spending and optimizing financial rewards.

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III. COMPETITION

The market for new, Internet-based technologies is evolving rapidly, and will be intensely competitive reacting quickly to the accelerating pace of technological change. The Company faces competition in this market sector from a broad sector of companies in many diverse fields whose primary focus is to identify problems and to create new technological solutions for these problems. Further, the search to acquire new technology developed by other for commercialization is also an intensely competitive area. In its efforts to acquire new technology the Company will be competing with many companies in a wide range of industries, most of whom have greater financial resources than the Company and greater market recognition.

Although management believes that the Company's current technologies provides a number of competitive advantages in the markets for which they have been designed, it must be remembered that many of its competitors have longer operating histories, a larger customer base, greater brand recognition and greater financial, technical, marketing and other resources than the Company. Current and potential competitors also have established or may establish relationships among themselves or with others in order to increase the services offered within the same business sectors as the Company.

IV. RISK FACTORS

1. LIMITED OPERATING HISTORY AND RECORD OF EARNINGS. The Company has only a limited history of operations. The Company has transferred its principal technology to a joint venture formed with Tradition N.A., a major brokerage and financial company, in exchange for a 25% interest in the joint venture. The joint venture has only recently begun to market the FX3000 software system and to provide revenues to the Company. The Company is also developing additional software product aimed at the e-commerce market, although no assurance can be given as to when these additional technologies will result in operating revenues to the Company. For fiscal year 2005, the Company realized a net loss of $905,298 (as compared to a net loss of $1,436,378 for fiscal 2005). As a development stage enterprise, the Company is subject to all of the risks inherent in the establishment of a new business, including the absence of a significant operating history, lack of market recognition and limited banking and financial relationships. Further, the Company's auditor has included a "going concern" footnote in the Company's audited financial statements for fiscal 2006. See "FINANCIAL STATEMENTS - FOOTNOTE 12."

2. RELIANCE UPON MANAGEMENT. The Company is largely dependent upon the personal efforts of its current management, the loss of any of which could have a material adverse effect upon the Company's business and prospects. The Company does not have key-man life insurance upon the life of any of its officers or directors. Additionally, as the Company implements its commercial operations, it will require the services of additional skilled personnel. There can be no assurance that the Company can attract persons with the requisite skills and training to meet its future needs or, even if such persons are available, that they can be hired on terms favorable to the Company.

3. UNCERTAINTY AS TO MANAGEMENT'S ABILITY TO CONTROL COSTS AND EXPENSES. With respect to the Company's development of its technologies and the implementation of commercial operations, the Company cannot accurately project or give any assurance, with respect to management's ability to control the Company's development and operating costs and/or expenses. Consequently, if management is not able to adequately control costs and expenses, such operations may not generate any profit or may result in operating losses.

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4. POSSIBLE ADVERSE EFFECT OF REGULATORY CHANGES. At present, none of the business segments where the Company plans to operate have significant government regulation that could be expected to adversely affect the commercialization of the Company's technologies. However, all of the Company's present technology is related to the Internet and it is possible that the current federal, state or local laws and regulations which apply to the Internet and which relate to services the Company plans to offer its customers, may change in the future. Although it is not possible to predict the extent of any such changes, and although management is not aware of any pending adverse changes in the regulations applicable to Its planned business operations, it is possible that future or unforeseen changes may have an adverse impact upon the Company's ability to continue or expand operations as presently planned.

5. INTELLECTUAL PROPERTY RIGHTS. The Company's success will depend in significant part on certain methodologies it plans to utilize in connection with the commercial applications for its newly acquired technology, as well as with respect to its FX3000 trading system, and on proprietary intellectual property rights it has and may in the future develop. The Company plans to rely on a combination of nondisclosure and other contractual arrangements and trade secrets, copyright, patent and trademark laws to protect its proprietary rights and the proprietary rights of third parties from whom the Company may licenses intellectual property. The Company also plans to enter into confidentiality agreements with its employees and consultants and limits access to, and distribution of, proprietary information. There can be no assurance that the steps planned by the Company in this regard will be adequate to deter misappropriation of proprietary information or that the Company will be able to detect unauthorized use and take appropriate steps to enforce its intellectual property rights.

6. RELIANCE UPON WEB SITE, NETWORK INFRASTRUCTURE AND TRANSACTION-PROCESSING SYSTEMS. The satisfactory performance, reliability and availability of the Company's Internet-based technologies, transaction-processing systems and network infrastructure are critical to its operating results, as well as to its ability to attract and retain customers and maintain adequate customer service levels. Any system interruptions that result in the unavailability of or reduced performance of the Company's systems would reduce the volume of revenues and the functionality of the Company's technology. Further, any interruptions in such service could adversely impact the effectiveness of the Company's technology and its ability to perform the functions for which they have been designed. This would seriously harm the Company's business, operating results and financial condition. Management expects that there will be a need to periodically upgrade its system architecture to accommodate increased traffic and processing needs as the Company's business continues to develop. Management expects this process to be time consuming and expensive without any assurance that such upgrades will be successful.

7. DEPENDENCE ON INCREASED USE OF THE INTERNET AND ON THE GROWTH OF ONLINE COMMERCE. The Company's future revenues depend upon the increased acceptance and use of the Internet and other online services as a medium of commerce. The market for Internet services is in an early stage of growth. Rapid growth in the use of the Internet, the Web and online services is a recent phenomenon. As a result, acceptance and use may not continue to develop at historical rates and a sufficiently broad base of customers may not adopt, and/or continue to use, the Internet and other online services as a medium of commerce.

8. RISK OF TECHNOLOGICAL OBSOLESCENCE. All industries based upon innovative technology, such as the Company's planned Internet-based systems, are characterized by rapid technological advances, evolving industry standards in computer hardware and software technology, changes in customer requirements and frequent new developments and technological enhancements. As a result, the

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Company's ability to remain competitive will depend in significant part upon its ability to continually upgrade its systems and service to keep up with such technological advances and changes in a timely and cost-effective manner in response to both evolving demands of the marketplace, requirements of applicable laws and regulations and product/service offerings by its competitors. In addition, over the longer term, the Company's ability to remain competitive will depend in significant part upon its ability to develop and introduce, in a timely and cost-effective manner, enhancements to its basic systems and products, which incorporate new technological advances that provide an advantage over its competition. If the Company faces material delays in introducing new services, products and enhancements, customers may forego the use of the Company's system and services and use those of competitors.

9. NO DIVIDENDS AND NONE ANTICIPATED. The Company has not paid any dividends nor, by reason of its contemplated financial requirements, does it anticipate paying any dividends upon its Common Shares in the foreseeable future. Further, the Company has existing commitments to pay dividends on its Preferred Shares which are ongoing and currently in default.

10. ADDITIONAL FINANCING. The Company will require significant additional capital to complete development of its recently acquired technology, commercialization of this technology and for general working capital purposes. To date, such financing has been provided either by loans from the Company's principal shareholders or through the sale of the Company's securities, or a combination of both. There can be no assurance that such sources of capital will prove sufficient in the future. There can be no assurance that any additional sources of financing will be available in the future or, if available, that it can be obtained on terms favorable to the Company.

11. NO PUBLIC MARKET FOR SECURITIES. There is currently no public market for any of the Company's securities. Although management expects that a market will develop for its Common Shares in the future, no assurance can be given that any trading market that develops will be sustained or that shareholders will be able to sell their shares.

12. RISKS OF LOW-PRICED STOCKS; POSSIBLE EFFECT OF "PENNY STOCK" RULES ON LIQUIDITY FOR THE COMPANY'S SECURITIES. It is likely that if the Company's stock is eligible to be traded in the future it will be defined as a "penny stock" under Rule 3a51-1 adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934. In general, a "penny stock" includes securities of companies which are not listed on the principal stock exchanges or the National Association of Securities Dealers Automated Quotation System ("NASDAQ") or National Market System ("NASDAQ NMS") and have a bid price in the market of less than $5.00; and companies with net tangible assets of less than $2,000,000 ($5,000,000 if the issuer has been in continuous operation for less than three years), or which has recorded revenues of less than $6,000,000 in the last three years. "Penny stocks" are subject to rule 15g-9, which imposes additional sales practice requirements on broker-dealers that sell such securities to persons other than established customers and "accredited investors" (generally, individuals with net worth in excess of $1,000,000 or annual incomes exceeding $200,000, or $300,000 together with their spouses, or individuals who are officers or directors of the issuer of the securities). For transactions covered by Rule 15g-9, a broker-dealer must make a special suitability determination for the purchaser and have received the purchaser's written consent to the transaction prior to sale. Consequently, this rule may adversely affect the ability of broker-dealers to sell the Company's stock, and therefore, may adversely affect the ability of the Company's stockholders to sell stock in the public market.

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13. FORWARD-LOOKING STATEMENTS. This document contains forward-looking statements. Readers are cautioned that all forward-looking statements involve risk and uncertainty. Although the Company believes that the assumptions underlying the forward-looking statements contained herein are reasonable, any of the assumptions could be inaccurate, and therefore, there can be no assurance that the forward-looking statements included in this document will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by the Company or any other person that the objectives and plans of the Company will be achieved. (See "Forward Looking Statements", PART I above).

(C) REPORTS TO SECURITY HOLDERS

The public may read and copy any materials filed with the SEC at the SEC's Public Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. The address of that SEC internet site is http://www.sec.gov.

ITEM 2. DESCRIPTION OF PROPERTY

The Company's office is located at 32 Broadway, 3rd Floor, New York, NY10004, and its telephone number is 212-968-0941. The Company occupies these premises, which consist of approximately 2,000 square feet of office space pursuant to a written sub-lease with an affiliated party that expires in February, 2009. The Company currently pays rent of approximately $3,500 per month pursuant to said sub-lease. See Financial Statements, Footnote 13, for more detailed information concerning the Company's obligations under this lease. The premises and contents are fully insured.

At this time, the Company has no policy in terms of investment in real estate nor does it have any investment in real estate. The Company has no immediate plans to invest in real estate mortgages.

ITEM 3. LEGAL PROCEEDINGS

Following the end of the fiscal year, a former consultant to the Company brought a suit against the Company and certain of its management alleging that he was entitled to receive certain shares of the Company's common stock and for other damages. The Company has retained special litigation counsel and will vigorously defend against the claims made by the plaintiff in that action. After consulting with such counsel management believes that the claims made by the plaintiff are without merit and expects to prevail in all respects in that action.

Apart from the foregoing action, the Company is not a party to any litigation and to its knowledge, no action, suit or proceedings against it or any officer or director, in his capacity as such, has been threatened by any person or entity.

ITEM 4. SUBMISSIONS OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matters have been submitted to a vote of security holders during fiscal 2006.

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PART II

ITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

(a) There is currently no public market for any of the Registrant's Securities. Although management expects that a market will develop for the Common Shares in the future, no assurance can be given that any trading market that develops will be sustained or that investors will be able to recoup their investment.

(b) There are approximately 275 holders of the common equity of the Company.

(c) There have been no cash dividends declared to date and there are no plans to do so. There are no restrictions that limit the ability to pay dividends on common equity other than the dependency on the Company's revenues, earnings and financial condition.

The Company's Common Stock has been approved for trading on the OTC Bulletin Board system under the symbol "AVGG."

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

BACKGROUND

Advanced Technologies Group, Ltd. (the Company) was incorporated in the State of Nevada in February 2000. Although the Company had begun to generate revenues from the leasing of the FX3000 software system, in March 2002, the Company transferred its FX3000 system to FX Direct Dealer, LLC, a joint venture company that will market the FX3000 software program. At that time the Company terminated all existing leases for the FX3000 system. The Company received a 25% interest in the joint venture company in return for the transfer. The remaining 75% of the joint venture company is owned by Tradition, N.A., a subsidiary of Compagnie Financiere Tradition, a major Swiss-based financial company.

The Company also is the developer of the PromotionStat and Promote4Free software program, which assists on-line advertisers in monitoring their marketing effectiveness and which is planned to be marketed through the Company's subsidiaries. The Company believes that these technologies, when properly developed, will have the potential for generating significant revenues and profits for the Company.

GENERAL STATEMENT: FACTORS THAT MAY AFFECT FUTURE RESULTS.

With the exception of historical information, the matters discussed in Management's Discussion and Analysis of Financial Condition and Results of Operations contain forward looking statements under the 1995 Private Securities Litigation Reform Act that involve various risks and uncertainties. Typically, these statements are indicated by words such as "anticipates", "expects", "believes", "plans", "could", and similar words and phrases. Factors that could cause the company's actual results to differ materially from management's projections, forecasts, estimates and expectations include but are not limited to the following:

11

* Inability of the company to secure additional financing
* Unexpected economic changes in the United States
* The imposition of new restrictions or regulations by government agencies that affect the Company's business activities.

To the extent possible, the following discussion will highlight the activities of the Company's business activities for the fiscal years ended January 31, 2006 and January 31, 2005.

I. RESULTS OF OPERATIONS

COMPARISON OF OPERATING RESULTS.

CONSOLIDATED SALES, GROSS PROFIT, AND NET INCOME:

Total gross revenues for the fiscal year 2006 were $951,644 (compared to $940,195 for fiscal 2005), which consisted of $951,644 in revenues realized from the FX3000 joint venture (compared to $859,444 for fiscal 2005) and $-0- from the on-line use of the PromotionStat software (compared to $80,751 for fiscal 2005). After costs of revenues of $624,877 (compared to $557,939 for fiscal 2005) the Company realized net revenues of $326,767 for fiscal 2006, compared to $382,256 for fiscal 2005. The decrease in net revenues was due primarily to the decrease in revenues from the sales of the PromotionStat software product and certain costs incurred in the maintenance of that software product. During fiscal year 2006 PromotionStat software was extensively utilized (free of charge) by FXDirectDealer and resulted in substantial savings for the user's internet advertising budget. Technilogical feasability for PromotionStat has been established as per SFAS No. 86, paragraph 4 at the same time a working model was established in 2002. However, with its primary focus being on its FXDirectDealer joint venture, management cannot predict when it will have adequate funds to devote to the promotion and commercialization of the PromotionStat technology. It is important to note that during fiscal 2005 the Company's efforts with respect to PromotionStat resulted in very limited initial revenues with respect to this technology. During fiscal 2006 management elected to focus on the finalization of development of that software and elected to only offer its use as a promotion for the FX3000 software free of charge to new subscribers to the FX3000 software. Management intends to continue this promotion in the foreseeable future and does not expect any revenues from its PromotionStat technology during the current fiscal year.

Management's cut its administrative costs, which began during fiscal 2004, continued during 2006 with total general and administrative expense for fiscal 2006 declining to $1,240,742 compared to $1,458,720 for last year, a decrease of $217,978 or slightly less than 15%. The main area of decreased costs was consulting expenses that decreased to $179,640 (compared with $378,913 in fiscal 2005); promotion and advertising costs which decreased to $347,786 (compared to $361,197 in fiscal 2005); and general administration expenses which decreased to $356,861 (compared to $554,792 in fiscal 2005). However, the Company did realize increases in salaries and benefits, which rose to $293,664 (compared to $135,308 in fiscal 2005) and in depreciation expenses which rose to $34,752 (compared to $28,510 in fiscal 2005). During fiscal 2006 management's principal focus was on the joint venture for its FX3000 technology. Virtually all of its resources and efforts went into providing the support and technology upgrades required by its joint venture partner to further the operations of the joint venture company. Management expects this focus to continue for the foreseeable future. For this reason, the major areas of expenses for the Company continue to be related to its FX3000 technology including consulting costs. During fiscal 2006 there were

12

no increases in the maintenance costs charged to the joint venture company, which remain the Company's only source of revenues.

After deducting general and administrative costs, the Company experienced a loss from operations of $913,975 for the fiscal 2006, compared to a loss of $1,436,378 for last year. This represents a decrease in the Company's loss of $531,080 or approximately 37% over that experienced in fiscal 2005. Management attributes this to normal fluctuations in revenues while commercial operations are established by the joint venture and the Company's continued success in reducing operating costs.

Net loss for fiscal 2006 was $905,298, or $0.05 per share, compared to a loss of $1,436,378, or $.13 per share for last year. In calculating the loss per share, the Company had to take into account the dividends due the preferred shareholders at January 31, 2006 and January 31, 2005. At January 31, 2006 and January 31, 2005, the preferred dividends were in arrears for $-0- and $653,879, respectively.

II. DISCUSSION OF FINANCIAL CONDITION: LIQUIDITY AND CAPITAL RESOURCES

At January 31, 2006 cash on hand was $442,575 as compared with $597,547 at January 31, 2005. During fiscal 2006, the Company issued 1,196,427 shares of preferred stock and received net proceeds of $589,093. The Company applied $1,138,171 received in fiscal 2005 for the preferred B towards this issuance.

The Company used these cash proceeds to pay for its business operations, to purchase and upgrade its computer hardware, and to pay down a loan from a shareholder. The Company does not expect any material capital expenditures in fiscal year 2007.

At January 31, 2006, the Company had working capital of $393,066 compared to working capital of $569,437 at January 31, 2005. Working capital decreased mainly as a result of reduced cash on hand due to normal fluctuations in the use of cash by the Company and repayment of a loan due to a shareholder during fiscal 2006.

Total assets at January 31, 2006 were $560,749 as compared to $773,184 at January 31, 2005. The principal cause of this decrease in total assets at January 31, 2006 was the decrease in cash on hand and prepaid expenses at January 31, 2006.

The Company's total stockholders' equity decreased to $466,240 at January 31, 2006 from $678,019 at January 31, 2005. Stockholders' equity decreased principally because of the loss from operations experienced by the Company, as offset in part by the issuance of preferred stock for cash during the period.

During fiscal year 2006, the Company issued 35,485 shares of common stock to consultants for services rendered. In addition, the Company issued 437,528 shares of common stock to preferred A and preferred B stock holders to pay preferred dividends in arrears. The Company valued the shares of common stock issued during fiscal 2006 at $1,390,658.

During fiscal 2006 FXDirectDealer LLC, the Company's joint venture with Tradition NA began to recognize a net profit from operations. However, due to the loans that Tradition had made to the joint venture during the initial years when it was developing its business operations, all of the net profits generated to date have been applied to the partial repayment of these loans. Management

13

believes that, based upon the rate of growth of the joint venture's operations and its projected profitability, all loans due to Tradition will be fully repaid during fiscal 2007. Thereafter, management expects that the Company will begin to receive profit distributions on a quarterly basis as provided for in the joint venture agreement.

ITEM 7. FINANCIAL STATEMENTS

The Financial Statements of the Company are filed as a part of this Annual Report. Included are the audited statements of Advanced Technologies Group, Ltd. for the years ending January 31, 2006 and 2005 are submitted herewith as PART F/S on Pages 31 to 45.

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL MATTERS

There have been no disagreements with the registrants former or present Accountants on accounting and financial matters.

PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

The Company has three officers and three directors.

The following table sets forth as of the date hereof, with respect to each of the Company's directors and officers their position and their ages: 

 NAME AGE POSITION
 ---- --- --------
Alex Stelmak 57 Chief Executive Officer, Chairman of the Board
 of Directors & CFO

Stan Mashov 37 Vice President, Chief Technology Officer & Director

Dr. Abel Raskas 65 President, Senior Marketing Director and Director
 of the Company; CEO and Director of Luxury Lounge
 and its Subsidiaries

The directors will serve until the next annual meeting of stockholders and until their successors are qualified and elected. The officers are also newly appointed and serve at the will of the Board of Directors. There are no existing committees of the Board of Directors. There are no family relationships among the officers and directors of the Company. There are at present no committees of the Board of Directors.

There are no agreements that a director will resign at the request of another person and the above named Directors are not acting on behalf of nor will act on behalf of another person.

The following is a brief summary of the Directors and Officers including their business experiences for the past five years.

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ALEX STELMAK, CHAIRMAN AND CHIEF EXECUTIVE OFFICER

Mr. Stelmak founded and has been President and Chief Executive Officer of the Company since its formation in 1997. He has over twenty years of experience in operation and management, building highly successful financial services firms. Mr. Stelmak has served as President of Commonwealth Capital Group, Ltd., a financial advisory and investment-banking firm that has been engaged as a consultant to the Company. From 1996 to 1998, he served as the President of Oxford Holdings - a Registered Commodities Broker/Dealer principally engaged in providing managed currency-trading programs for Institutional and private clients. Prior to 1996 Mr. Stelmak also served as a stockbroker with BDS Securities, Greenway Capital and US Securities, Inc. He holds a Series 7 and 63 licenses from the National Association of Securities Dealers. Mr. Stelmak holds a BS degree in Business Administration with a major in accounting.

STAN MASHOV, VICE PRESIDENT AND CHIEF TECHNOLOGY OFFICER

Mr. Mashov founded and has been Vice President and head of information technology of the Company since its formation in 1997. He has also served in the same capacity for Oxford since its formation in September 1997. Mr. Mashov has been mainly responsible for the design, development and implementation of the FX3000 on-line currency trading software platform. He is also responsible for FX3000's human and technical resources dedicated to software, technology and infrastructure development, implementation and business support. During his tenure with the Company Mr. Mashov assembled a superior team of programmers who, under his supervision designed, developed and implemented FX3000's assignment for a new software system to meet trading, risk management and back office business requirements. He was also instrumental in implementing FX3000's web site, manual and educational material. Prior to joining the Company, Mr. Mashov served as Chief Analyst and Currency Trader for Oxford Holdings, a company principally engaged in providing managed currency trading programs for individual investors. Mr. Mashov received his Degree in Accounting from Berkeley College.

DR. ABEL RASKAS, PRESIDENT/SENIOR MARKETING DIRECTOR

Dr. Raskas has served as a director of the Company since 1998. He is also Founder and President of Luxury Lounge, Inc. - an Internet wholesaler and retailer of luxury and premium quality goods and services recently acquired by the Company. Prior to establishing Luxury Lounge, Inc. Dr Raskas served as Vice President of Trimol Group, Ltd., a Publicly Held company engaged in the business of producing specialized documents through patented software. As a Principal of Trimol Group, Ltd, Dr. Raskas was instrumental in bringing the Company to the Public Market. Prior to joining Trimol, from 1991 to 1998, he was a Principal and Vice President of Ocean Bridge International, Ltd., a company principally engaged in commercial finance and International trade with Eastern European countries. From 1980 to 1986 Dr. Raskas was the Founder and Principal of ABDATA Independence, Inc., a computer service bureau that was acquired in 1986 by Sandata Corp. Following the sale of ABDATA, Dr. Raskas remained a director of Marketing for Sandata Corp. until 1991. During this same period Dr. Raskas managed a data processing school and was one of the founders of CAIS Systems, a computer advertising information system. From 1966 through 1979 Dr. Raskas was an independent consultant in the design and implementation of management information systems ("MIS") to different industries. Dr. Raskas holds the equivalent of a Doctorate Degree in business management and computer science

15

from St. Petersburg University (received in 1973). He has authored 20 articles and one book all in the field of business management and computer science.

KEY EMPLOYEES

DMITRY FINKELSTEIN, DIRECTOR OF SOFTWARE DEVELOPMENT

Mr. Finkelstein joined the Company in the beginning of 2000 as a special technical adviser. Mr. Finkelstein was instrumental in establishing its Software Development Department. As a Director of the Software Development Department, Mr. Finkelstein is managing development efforts dedicated to FX3000 trading platform. While at the Company, Mr. Finkelstein assembled a number of talented and dedicated software professionals into a creative and productive development team with a high level of software engineering culture and challenging goals. More importantly, Mr. Finkelstein helped establish the Company's software development process and quality assurance standards and practices designed to provide consistent quality control in all aspects of the Company's technology development. With his broad software engineering experience Mr. Finkelstein also took part in the development of high-level design and architectural concepts for the next generation of the FX3000 platform and has been managing all the analytical, design, implementation and testing activities for subsequent FX3000 releases. Mr. Finkelstein holds a Master of Science Degree in Mathematics from St. Petersburg Institute of Fine Mechanics and Optics.

None of the Directors, Officers or key employees has been convicted or is subject to a pending criminal proceeding, nor have they been subjected to any type of order barring, suspending or otherwise limiting their involvement in any type of business, securities or banking activities. Furthermore, none of the Directors and Officers has been found by a court of competent jurisdiction, the Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law.

BOARD OF ADVISORS

The Company has assembled a Board of Advisors to advise the Board with respect to specific matters affecting the Company and its business operations. Depending upon the nature of the advice requested by the Board, they may receive compensation in specific circumstances as determined by the Board of Directors. Their recommendations are purely advisory and the Board is not obligated to follow any recommendations made. Following are profiles for each member of the Board of Advisors:

DR. ALFRED D. MORGAN, PH.D. SPECIAL FINANCIAL ADVISOR TO THE BOARD OF DIRECTORS

Dr. Alfred D. Morgan joined the Company in November 2000. Mr. Morgan brings to the Company more than 25 years of versatile and diverse financial experience with major Public and Private Corporations. He worked for 4 years with Lehman Bros. as a Securities Analyst, Portfolio Manager and General Corporate Financing Executive. After that Mr. Morgan accepted a position of Director of Development with Fairbanks Whitney Corp (NYSE). Subsequently, he joined a NYSE firm Federman, Stonehill as a Partner directly responsible for major IPO`s (Subaru of America, Cablevision Systems). At the same time (1980-1983) Mr. Morgan was a Special Professor of Finance with Hofstra University School of Business. By 1984 he devoted his full time to teaching as Professor of Finance at Southern Connecticut State University, where he introduced courses in Entrepreneurship and Security Analysis. At the same time he was involved with managing of Peachtree Venture Capital Fund and was directly responsible for aiding a number

16

of growth companies to penetrate Public Markets by Reverse Merger (Transmedia Network, Resources America, MSH Entertainment). During his distinguished career in the financial community, Mr. Morgan also held a number of Directorship positions with major Public and Private Corporations: Magic Marker Pens Co., Transmedia, Resources America Oil Co., Columbia Financial Exchange, MSH Entertainment, etc. Mr. Morgan also enjoys a long lasting working relationship with a number of financial publications where he frequently publishes his articles including Wharton Journal of Venture Capital, Oxford Journal of Statistics, Bankers Magazine, US Investor, Nation. Dr: Morgan holds Ph.D. in Economics from Harvard, Teaching Fellowship, Research Scholarship Oxford University for Ph.D. Thesis, M.A. Scholarship from University of Wisconsin, Assistant in Statistics, M.A. Thesis. Non-Degree courses with New York University in Accounting, Arbitrage, Investment Banking. Honors and Recognition's: Appointed by U.S Secretary of Commerce to Connecticut State District Council; Held a Seat on New York Commodities Exchange; Nominated as Teacher of the Year by Finance Club, Southern Connecticut State Univ. and Univ. of Georgia; Rhodes Scholar Nominee, Phi Beta Kappa.

JOSEPH BOTKIER, SPECIAL ADVISOR TO THE BOARD OF DIRECTORS

Mr. Botkier joined the Company in October 2000 as a special advisor to the Board. Mr. Botkier brings over 25 years of hands-on professional and management experience in the Banking and Currency Industries. His career started in 1972 as Deputy Operations Manager with HARRIS TRUST Co. of New York. From 1974 to 1985 Mr. Botkier served as Assistant Operations Manager and was later advanced to the position of Vice President and Treasurer of CREDITO ITALIANO. While at CREDITO ITALIANO Mr. Botkier is credited with establishing the bank as one of the first banks to trade Currency Futures and use Swap's and FRA's. As one of the youngest Bank Treasurers in New York, he assumed responsibility for Futures and Foreign Currency Dealing and posted profits yearly (From 1976-1985) while building a $1Bill. Portfolio with over $75 Million in profits. From 1985 to 1988 Mr. Botkier joined BANK CARIPLO of New York as First Vice President and Deputy General Manager, where he was directly responsible for establishing the bank's New York Treasury operations, which consisted of trading Money Market instruments, Currencies and Derivatives. From 1988 to 1998 Mr. Botkier had accepted a position of Senior Vice President and Treasurer and, later was promoted to Executive Vice President and Deputy General Manager with BANK BRUSSELS LAMBERT of New York. During his tenure at BBL he was fully responsible for the entire Foreign Exchange Department as well as Money Markets, Capital Markets, Derivatives and the structuring and funding of loan portfolios and Asset Management. As such, he was credited with successfully rebuilding the Trading Operations, transforming the Bank's Foreign Exchange desk from negative performance to cumulative profits in excess of $200 Million. At the same time, he instituted a computer based Risk Management System to monitor and evaluate Treasury Instruments. At BANK BRUSSELS LAMBERT Mr. Botkier was credited with restoring treasury function to profitability in 12 months (From $1.5 Mill. In 1989, $8 Mill. in 1990); establishing a proprietary mortgage-backed securities portfolio in 1992 ($1.5 Bill.) and asset-backed portfolio in 1993 ($1.1 Bill.); starting a Domestic High-Yield Trading and Asset Management Group in 1996 and growing the assets to over $200 Mill. In 1996 he Created and Managed a Proprietary Fund worth over $500 Mill. For the Bank, which was directly invested in Corporate Bonds. In 1997 Mr. Botkier launched the first Leveraged High Yield Fund for the Bank's account with $150 Mill. in assets. During the same year, he also established and managed a Proprietary Fund (75 Mill.) participating in Emerging Market Debt and launched the bank's first "Fund of Funds"($50 Mill.) In 1998 Mr. Botkier successfully concluded a $170 Mill. CBO in partnership with Goldman Sachs. During his distinguished career, Mr. Botkier became a successful senior level Banking Industry Executive with extensive strength in developing and executing highly profitable trading strategies dealing with: Currencies, Currency Options, Euro Bonds, Derivatives, Swaps, FRA's and High Yield

17

Securities. He is highly skilled and perceptive in fostering and maintaining long-term relationships with major Banks and Fortune 500 Company's, building organizational infrastructures to drive and sustain revenues, generating strong profits as well as identifying and capitalizing on new and niche market opportunities. In his long and successful career Mr. Botkier has maintained well over $5 Billion in capital under management. Mr. Botkier holds a BS degree in Mathematics. He also received his Advanced Studies from The American Institute of Banking.

ALEXANDER GORLOV, PH.D. CHIEF TECHNOLOGY ADVISOR TO THE BOARD OF DIRECTORS

Professor Alexander M. Gorlov of Northeastern University in Boston is the 2001 recipient of the prestigious ASME Thomas Edison Patent Award for his patented invention of the Gorlov Helical Turbine. The Edison Patent Award was established in 1997 in order to recognize the creativity of a patented device or process that has the potential to significantly enhance some aspects of mechanical engineering. Professor Gorlov is a Professor Emeritus at Northeastern. During his rich professional career, Professor Gorlov has established himself as a major powerhouse in High Technology field. He holds 21 International and US patents in such fields as Renewable Energy, Structural Analysis & Design, Theoretical Mechanics as well as the design of Bridges and Tunnels. In particular, his recent invention "Terrorist Truck-Bomb Protection System" is certified by 4 US patents and is placed on the US Department of State list of certified equipment. That allows the system to be used for protection of vital Government installations such as Nuclear Power Plants, Military Bases around the World, Embassies, Bridges and Tunnels as well as other potential strategic targets from terrorist attacks. Professor Gorlov is a recipient of research grants from the US Dept. Of Energy, Allied Signal Co., New England Power Co. He is a leading designer of a number of major worldwide construction projects such as subway systems, hydroelectric power plants, tunnels, bridges etc. Professor Gorlov is an author of over 90 periodical technical papers and 3 books.

CARL P. RANNO, SPECIAL LEGAL ADVISOR TO THE BOARD OF DIRECTORS

Mr. Ranno currently serves as Chairman and CEO of Spectrum Advisors, LLC, a company engaged in the business of mergers and acquisitions as well as advisory functions to its clients. Mr. Ranno is member of numerous boards of directors of both publicly held and private companies. Apart from his other duties and business affiliations, Mr. Ranno has been a practicing attorney since 1968 and currently serves as general counsel to numerous publicly held companies advising these companies in the areas of general corporate law and, specifically, in the areas of U.S. securities laws. From 1992 to 1997 Mr. Ranno served as President and CEO of Pollution Controls International Corp., a publicly traded company engaged in the manufacture and marketing of automotive after-market products on a global basis. From 1990 to 1992 Mr. Ranno also operated as an independent Investment Banker associated with Corporate Capital Group and, ultimately, Ladenburg Thalman in New York. His activities during this period principally involved the acquisition of companies that supply automotive manufacturers. Mr. Ranno hold a Bachelor of Science degree in Economics and Chemistry from Xavier University and a Juris Doctor degree from the University of Michigan School of Law.

DR. MARK G. KARPOVSKY, PH.D. SPECIAL ADVISOR TO THE BOARD OF DIRECTORS

Dr. Karpovsky has been a full Professor of Electrical and Computer Engineering of the Boston University, and Director of the Reliable Computing Laboratory since 1983. He conducts research in the areas of new techniques for design of reliable multiprocessors, networks of workstations and local area networks, routing in computer and communications networks, testing, and diagnosis of

18

computer networks combining on-line and off-line techniques for error detection and/or location, and fault-tolerant message routing for computer networks. Dr. Karpovsky teaches graduate courses on interconnection networks, computer hardware testing, fault-tolerant computing, and error-correcting codes. Dr. Karpovsky received the B.S., M.S. and Ph.D. degrees in 1961, 1963 and 1967, respectively. He has been Visiting Professor at the University of Dortmund and Ecole National Superieure des Telecommunication, Paris. Dr. Karpovsky has been a consultant for IBM, Digital Corp., Honeywell, and AT&T, and is currently Director of the Reliable Computing Laboratory. He has published more than 140 papers and several books in the areas of logic design, testing and diagnosis, fault-tolerant computing and error-correcting codes.

DR. V. L. KVINT, PH.D. SPECIAL ADVISOR TO THE BOARD OF DIRECTORS

Dr. Kvint has, since 1997, served as an independent consultant for the United Nations. Dr. Kvint also served as the Director of Emerging Markets for Arthur Andersen LLP where his duties included the analysis of various economies and development of the commercial environment in emerging markets world-wide. Dr. Kvint also currently serves as a Professor of Management Systems and International Business at the Graduate School of Business, Fordham University and as Adjunct Professor of Management Strategies in Emerging Markets at the Department of International Business, Leonard N. Stern School of Business, New York University. Dr. Kvint received his Masters of Science Degree in 1972 and his Doctorate Degree in Economics in 1975. In 1997, Dr. Kvint was named an Honorary Fellow by the New England Center for International and Regional Studies in Connecticut and also received an Honorary Doctorate Degree from the University of Bridgeport. IN 2001 DR. KVINT WAS AWARDED WITH THE PRESTIGIOUS
FULLBRIGHTE SCHOLAR AWARD IN ECONOMICS.

DR. JOSEPH MEDVED, PH.D. SPECIAL ADVISOR TO THE BOARD OF DIRECTORS

Dr. Medved has over 30 years in Data Processing experience, the last 20 years of which have been in development of database online applications. Dr. Medved positions included Project Manager, Business Analyst, System Architect and Database Administrator for major database online projects. For the past 10 years Dr. Medved has served as business Analyst-Database Administrator for the City University of New York, with primary duties in Internet application development. Dr. Medved is currently serving as full Professor of the Computer Science Dept. of the City University of New York. Dr. Medved served as System Architect for New York Life Insurance Company, where he was personally responsible for the entire computer system design and implementation. Dr. Medved holds a Masters Degree in Computer Science and Economics and a Ph.D. in Computer Science.

THEODORE JAY, PATENT COUNSEL TO THE BOARD OF DIRECTORS

Mr. Jay has been an attorney his entire career, having been admitted to practice before the bar in New York, New Jersey and Connecticut as well as being admitted to practice as a patent attorney in the United States Patent and Trademark Office. In 1946 he became a member of the patent department for GTE and was promoted successively from the position of Patent Attorney for the Research Laboratories to a Counsel for Telephone and Electronic Systems. During his tenure with GTE Mr. Jay led negotiations in concluding world-wide patent cross licenses with General Electric, AT&T and other major corporations as well as directing various types of patent and trademark litigation. During his employment with GTE Mr. Jay prepared and filed over 300 patent applications in various electronic, mechanical and chemical fields. In 1987 Mr. Jay accepted early retirement from GTE and established his present independent practice providing patent, copyright and Science Degree in General Engineering from the

19

Massachusetts Institute of Technology and his Doctorate of Law Degree from New York University School of Law. Mr. Jay was directly responsible for the successful completion of Patent Pending Application for FX3000 Proprietary Internet Currency Trading System.

SHOLIM GINSBURG, STRATEGIC TECHNOLOGY ADVISOR TO THE BOARD OF DIRECTORS

Sholim Ginsburg has over 26 years experience in management and programming in various fields of data processing and data communications in the banking, brokerage and engineering industries. Presently, Mr. Ginsburg serves as Vice President of Citicorp's Global Technology Organization where he manages the communications software area. Mr. Ginsburg has worked for Citicorp for over 15 years, having been involved with Citicorp's Y2K initiative and having overseen Citicorp's implementation of some of the first Web enabling technologies and TCP/IP on mainframe computers and router based communications networks in the banking industry. Also while at Citicorp, Mr. Ginsburg was in charge of communications hardware and software strategic planning with responsibilities for the network design, organization and integration to enhance network capabilities. Prior to joining Citicorp in 1985, Mr. Ginsburg held a senior technical position at Prudential Securities and Gibbs & Hills, Inc. Mr. Ginsburg holds both a Bachelors and Masters Degrees in Mathematics.

KEN R. LEW, SPECIAL ADVISOR TO THE BOARD OF DIRECTORS.

Mr. Lew is a consultant in the merger/acquisition business. Mr. Lew has been an Officer/Director of a public company since January 2000. He holds an M.B.A. in Business Finance, a B.Sc. in Cell Biology, and a B.A. in Chemistry from the University of Washington and Seattle City University. Mr. Lew has produced and edited two financial books and he has written numerous technical publications. His education, technical background and experience in business finance provide a valued source of technical and financial guidance.

COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

The Officers, Directors and those beneficially owning more than 10% of small business Company's class of equity securities registered under Section 12 of the Exchange Act, shall file reports of ownership and any change in ownership with the Securities and Exchange Commission. Copies of these reports are to be filed with the Company.

ITEM 10. EXECUTIVE COMPENSATION

The executive officers of the issuer received salaries, benefits and other compensation during fiscal 2006 of $275,422 in the aggregate. At present, there are no written employment agreements between the Company and any of its officers or directors.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth the Common Stock ownership of each person and /or group known by the Company to be the beneficial owner of five percent or more of the Company's Common Stock, each director individually, and all officers and

20

directors as a group. Each person has sole voting and investment with respect to the shares of Common Stock shown, and all ownership is of record and beneficial. 

 Number of Percent
 Name Shares Owned (1) Owned
 ---- ---------------- -----
Alex Stelmak 4,389,476 25.43%
32 Broadway, 3rd Floor
New York, NY 10004

Stan Mashov 827,778 4.8%
32 Broadway, 3rd Floor
New York, NY 10004

Dr. Abel Raskas 4,389,476 25.43%
32 Broadway, 3rd Floor
New York, NY 10004

Officers & Directors
as a Group (3 Persons) 9,606,730 55.66%

----------

(1) Based upon 17,263,140 issued and outstanding.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

During fiscal years 2006 and 2005, the Company sub-leased office space in New York, New York from a consulting firm that is the principle lessee of the office space. The company paid rent of $36,539 and $47,220 in fiscal years 2006 and 2005, respectively, for the space.

At January 31, 2005, the Company had loans outstanding in the amount of $15,388 from a company that is owned by an officer and a shareholder of the Company. The loan payable is unsecured, due on demand, and non-interest bearing. The loan was repaid during fiscal 2006.

There are no parents of this small business Company.

There are and have been no transactions with promoters.

There were no material underwriting discounts and commissions upon the sale of securities by the Company where any of the specified persons was or is to be a principal underwriter or is a controlling person or member of a firm that was or is to be a principal underwriter.

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ITEMS 13. EXHIBITS AND REPORTS ON FORM 8-K 

(a) Exhibits

 Exhibit No. Description
 ----------- -----------

 31.1 Certification under Section 302 of the Sarbanes-Oxley Act of
 2002 of Chief Executive Officer

 31.2 Certification under Section 302 of the Sarbanes-Oxley Act of
 2002 of Chief Financial Officer

 32 Certification under Section 906 of the Sarbanes-Oxley Act of
 2002 of Chief Executive Officer and Chief Financial Officer

(b) Reports on Form 8-K

None

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

ADVANCED TECHNOLOGIES GROUP, LTD. 

Dated: February 12, 2008 By: /s/ Alex Stelmak
 ------------------------------------
 Alex Stelmak
 Chief Executive Officer and Director


Dated: February 12, 2008 By: /s/ Abel Raskas
 ------------------------------------
 Abel Raskas
 President and Director


Dated: ebruary 12, 2008 By: /s/ Alex Stelmak
 ------------------------------------
 Alex Stelmak
 Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. 

Dated: February 12, 2008 By: /s/ Alex Stelmak
 ------------------------------------
 Alex Stelmak
 Director


Dated: February 12, 2008 By: /s/ Abel Raskas
 ------------------------------------
 Abel Raskas
 Director


Dated: February 12, 2008 By: /s/ Stan Mashov
 ------------------------------------
 Stan Mashov
 Director

23

MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rules 13-a-15(f) and 15d-15(f) under the Exchange Act as a process designed by, or under the supervision of, the Company's principal executive and principal financial officers and effected by the Company's board of directors, management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles and includes those policies and procedures that:

* pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;

* provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorization of management and directors of the Company; and

* provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company's assets that could have a material effect on the financial statements.

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

Management assessed the effectiveness of the Company's internal control over financial reporting as of January 31, 2006. In making this assessment, management used the criteria established in "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Based on this assessment, management believes that, as of January 31, 2006 the Company's internal control over financial reporting is effective.

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

24

DONAHUE ASSOCIATES, LLC
Certified Public Accountants
27 Beach Road Suite CO5A
Monmouth Beach, NJ 07750
Tel. 732-229-7723

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of Advanced Technologies Group, Ltd., and its Subsidiary

We have audited management's assessment, included in the accompanying Management's Report on Internal Control Over Financial Reporting Advanced Technologies Group, Ltd., and its Subsidiary maintained effective internal control over financial reporting as of January 31, 2006, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). Advanced Technologies Group, Ltd.'s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting. Our responsibility is to express an opinion on management's assessment and an opinion on the effectiveness of the company's internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, evaluating management's assessment, testing and evaluating the design and operating effectiveness of internal control, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

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

F-1

In our opinion, management's assessment that Advanced Technologies Group Ltd and its Subsidiary maintained effective internal control over financial reporting as of January 31, 2006, is fairly stated, in all material respects, based on the COSO criteria.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of Advanced Technologies Group Ltd as of January 31, 2006 and January 31, 2005, and the related consolidated statements of operations, stockholders' equity, and cash flows for the years then ended and express an unqualified opinion thereon.

As more fully discussed in Note 12 to the consolidated financial statements, there are significant matters concerning the Company that raise substantial doubt as to the ability of the Company to continue as a going concern. Management's plans with regard to these matters are also described in Note 12 to the consolidated financial statements. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded assets or the amounts and classifications of recorded liabilities that might be necessary in the event that the Company cannot continue in existence. 

/s/ Donahue Associates, LLC
----------------------------------
Monmouth Beach, New Jersey
April 25, 2006

F-2

Advanced Technologies Group, Ltd.


Consolidated Balance Sheets

As of January 31, 2006 and January 31, 2005 

 2006 2005
 ------------ ------------
ASSETS

Current assets:
 Cash & short term deposits $ 442,575 $ 597,547
 Prepaid expense 0 21,955
 ------------ ------------
 Total current assets 442,575 619,502

Other assets:
 Fixed assets- net $ 64,089 $ 98,991
 Security deposit 45,000 45,000
 Trademark- net 9,085 9,691
 ------------ ------------

 Total assets $ 560,749 $ 773,184
 ============ ============

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
 Accounts payable & accrued expenses $ 94,509 $ 79,677
 ------------ ------------
 Total current liabilities 94,509 79,677

Shareholder loan payable 0 15,388

Shareholders' equity:
 Series A preferred stock, one share convertible to one share of common;
 13% cumulative non-participating, authorized 1,000,000 shares at
 stated value of $3 per share, issued and outstanding 880,588 shares $ 2,068,122 $ 2,068,122

 Series B preferred stock, one share convertible to one share of common;
 6% cumulative non-participating, authorized 7,000,000 shares at stated
 value of $3 per share, issued and outstanding 1,713,598 shares
 at January 31, 2006 and 517,171 at January 31, 2005 4,724,804 4,379,769

 Common stock- $.0001 par value, authorized 100,000,000 shares, issued
 and outstanding, 17,263,140 shares at January 31, 2006 and 16,790,127
 shares at January 31, 2005 1,727 1,679
 Additional paid in capital 31,275,783 29,641,115
 Accumulated deficit (37,604,196) (35,412,566)
 ------------ ------------
 Total shareholders' equity 466,240 678,119
 ------------ ------------

 Total Liabilities & Shareholders' Equity $ 560,749 $ 773,184
 ============ ============

See the notes to the financial statements.

F-3

Advanced Technologies Group, Ltd.

Consolidated Statements of Operations
For the Years Ended January 31st 

 2006 2005
 ------------ ------------
Revenues:
 Revenues from FX Direct Dealer LLC $ 951,644 $ 940,195
 Cost of revenues (624,877) (557,939)
 ------------ ------------
 Gross profit $ 326,767 $ 382,256

General and administrative expenses:
 Salaries and benefits $ 293,664 $ 135,308
 Promotion & advertising 347,786 361,197
 Consulting 207,679 378,913
 General administration 356,861 554,792
 Depreciation 34,752 28,510
 ------------ ------------
 Total general & administrative expenses 1,240,742 1,458,720
 ------------ ------------

Net loss from operations $ (913,975) $ (1,076,464)

Other revenues and expenses:
 Loss on investment in joint venture 0 (365,369)
 Interest income 8,677 5,455
 ------------ ------------

Net loss before provision for income taxes $ (905,298) $ (1,436,378)

Provision for income taxes 0 0
 ------------ ------------

Net loss $ (905,298) $ (1,436,378)
 ============ ============
Loss per common share:
 Basic & fully diluted $ (0.05) $ (0.13)

Weighted average of common shares:
 Basic & fully diluted 17,004,648 16,725,172

See the notes to the financial statements.

F-4

Advanced Technologies Group, Ltd.

Consolidated Statements of Cash Flows
For the Years Ended January 31st 

 2006 2005
 ----------- -----------
Operating Activities:
 Net loss $ (905,298) $(1,436,378)
 Adjustments to reconcile net loss items
 not requiring the use of cash:
 Amortization 606 607
 Depreciation 43,596 54,871
 Consulting expense 104,326 180,000
 Loss on investment in joint venture 0 365,369
 Changes in other operating assets and liabilities:
 Prepaid expense 21,955 (15,574)
 Accounts payable & accrued expenses 14,832 19,939
 ----------- -----------
Net cash used by operations $ (719,983) $ (831,166)

Investing Activities:
 Purchase of equipment $ (8,694) $ (35,051)
 ----------- -----------
Net cash provided by investing activities (8,694) (35,051)

Financing Activities:
 Issuance of preferred stock $ 626,348 $ 71,025
 Subscriptions received 0 1,138,171
 Placement fees (37,255) (50,269)
 Shareholder advances repaid (15,388) (57,019)
 ----------- -----------
Net cash provided by financing activities 573,705 1,101,908
 ----------- -----------

Net increase (decrease) in cash during the period (154,972) 235,691

Cash balance at February 1st 597,547 361,856
 ----------- -----------

Cash balance at January 31st $ 442,575 $ 597,547
 =========== ===========

Supplemental disclosures of cash flow information:
 Interest paid during the period $ 0 $ 0
 Income taxes paid during the period $ 8,646 $ 15,844

See the notes to the financial statements.

F-5

Advanced Technologies Group, Ltd. Consolidated Statement of Changes in Shareholders' Equity For the Years Ended January 31, 2006 and January 31, 2005 

 Common Common Preferred Preferred Paid in Accumulated
 Shares Par Value Shares Value Capital Deficit Total
 ------ --------- ------ ----- ------- ------- -----
Balance at February 1, 2004 16,619,603 $1,662 1,374,084 $5,293,793 $29,124,761 $(33,644,646) $ 775,570

Preferred stock
 subscriptions received 1,138,171 1,138,171

Preferred stock issued 23,675 15,927 4,829 20,756

Shares issued for services 60, 0 6 179,994 180,000

Stock dividend paid 110,524 11 331,531 (331,542) 0

Net loss for the fiscal year (1,436,378) (1,436,378)
 ---------- ------ --------- ---------- ----------- ------------ -----------

Balance at January 31, 2005 16,790,127 $1,679 1,397,759 $6,447,891 $29,641,115 $(35,412,566) $ 678,119

Preferred stock issued 1,196,427 345,035 244,058 589,093

Shares issued for services 35,485 4 104,322 104,326

Stock dividend paid 437,528 44 1,286,288 (1,286,332) 0

Net loss for the fiscal year (905,298) (905,298)
 ---------- ------ --------- ---------- ----------- ------------ -----------

Balance at January 31, 2006 17,263,140 $1,727 2,594,186 $6,792,926 $31,275,783 $(37,604,196) $ 466,240
 ========== ====== ========= ========== =========== ============ ===========

See the notes to the financial statements.

F-6

ADVANCED TECHNOLOGIES GROUP, LTD.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED JANUARY 31, 2006 AND JANUARY 31, 2005

1. ORGANIZATION OF THE COMPANY AND SIGNIFICANT ACCOUNTING PRINCIPLES

Advanced Technologies Group, Ltd. (the Company) was incorporated in the State of Nevada in February 2000. The Company is the designer of the FX3000, a foreign currency trading software program.

In March 2002, the Company sold the FX3000 software program, for a 25% interest in a joint venture with FX Direct Dealer LLC, a company that markets the FX3000 software. The Company does not have operational control over FX Direct Dealer LLC and the 75% owner of FX Direct Dealer LLC (Tradition NA) is the primary beneficiary.

The Company also is the developer of the PromotionStat software platform, which assists on-line advertisers in monitoring their marketing effectiveness.

CONSOLIDATION- the accompanying consolidated financial statements include the accounts of the company and its wholly owned subsidiaries. All significant inter-company balances have been eliminated.

USE OF ESTIMATES- The preparation of the consolidated financial statements in conformity with generally accepted accounting principles requires management to make reasonable estimates and assumptions that affect the reported amounts of the assets and liabilities and disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses at the date of the financial statements and for the period they include. Actual results may differ from these estimates.

REVENUE RECOGNITION

In March 2002, the Company sold the FX3000 software program, for a 25% interest in a joint venture with Tradition NA, a company that markets the FX3000 software. Under the terms of the agreement, the Company provides software maintenance services and receives 25% of the net profits from the joint venture. The Company is not obligated for any net losses of the joint venture.

The Company's interest in the joint venture is accounted for on a cost basis and adjusted for any net profits of the joint venture. Profit sharing revenues received from the joint venture are first applied to the cost of the investment and then to revenues.

The Company is providing software maintenance and support services for the users of the FX3000 program. The Company receives a fixed monthly fee from the joint venture for these services. Revenues received for the maintenance and support services are recognized by the Company when they are earned.

Under the terms of the agreement, Tradition NA is entitled to a full reimbursement of the startup costs and initial losses on the joint venture incurred prior to any revenue payments to the Company. The Company has received no profit sharing revenues since its investment in the joint venture in March 2002.

F-7

CASH AND INTEREST BEARING DEPOSITS- For the purpose of calculating changes in cash flows, cash includes all cash balances and highly liquid short-term investments with an original maturity of three months or less.

SOFTWARE DEVELOPMENT COSTS- The Company applies Statement of Financial Accounting Standard No. 86 (SFAS No. 86), ACCOUNTING FOR THE COSTS OF COMPUTER
SOFTWARE TO BE SOLD, LEASED, OR OTHERWISE MARKETED, (SFAS No. 86), to account for the costs in developing the FX3000. The software is designed to enable clients to execute on-line trades and monitor currency transactions that are entered into by the prospective client.

SFAS No. 86 provides that the costs of producing software programs subsequent to establishing technological feasibility shall be capitalized. The capitalization of such costs ceases when the product becomes available to customers. Amortization of the capitalized costs begins when the software product becomes available to customers and is calculated using the straight-line method over a period of three years.

FIXED ASSETS- Office and computer equipment are stated at cost. Depreciation expense is computed using the straight-line method over the estimated useful life of the asset. The following is a summary of the estimated useful lives used in computing depreciation expense: 

Furniture & lease improvements 7 years
Office equipment 3 years
Computer hardware 3 years
Software 3 years

Expenditures for major repairs and renewals that extend the useful life of the asset are capitalized. Minor repair expenditures are charged to expense as incurred.

LONG LIVED ASSETS- The Company reviews for the impairment of long-lived assets whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss would be recognized when estimated future cash flows expected to result from the use of the asset and its eventual disposition is less than its carrying amount.

INCOME TAXES- The Company accounts for income taxes in accordance with the Statement of Accounting Standards No. 109 (SFAS No. 109), "ACCOUNTING FOR INCOME TAXES". SFAS No. 109 requires an asset and liability approach to financial accounting and reporting for income taxes. Deferred income tax assets and liabilities are computed annually for differences between financial statement and income tax bases of assets and liabilities that will result in taxable income or deductible expenses in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets and liabilities to the amount expected to be realized. Income tax expense is the tax payable or refundable for the period adjusted for the change during the period in deferred tax assets and liabilities.

RECLASSIFICATIONS- Certain 2005 amounts in the consolidated financial statements have been reclassified to conform to the 2006 presentation.

F-8

RECENT ACCOUNTING PRONOUNCEMENTS:

STATEMENT OF FINANCIAL ACCOUNTING STANDARDS NO. 123R, "SHARE-BASED PAYMENT". In December 2004, the FASB issued Statement No. 123R, "Share-Based Payment". SFAS No. 123R is a revision of SFAS No. 123, "Accounting for Stock-Based Compensation," and supersedes APB 25. SFAS No. 123R eliminates the option of using the intrinsic value method of accounting previously available, and requires companies to recognize in the financial statements the cost of employee services received in exchange for awards of equity instruments based on the grant date fair value of those awards. The effective date of SFAS No. 123R is January 1, 2006 for calendar year companies. SFAS No. 123R permits companies to adopt its requirements using either a "modified prospective" method, or a "modified retrospective" method. Under the "modified prospective" method, compensation cost is recognized in the financial statements beginning with the effective date, based on the requirements of SFAS No. 123R, for all share-based payments granted after that date, and for all unvested awards granted prior to the effective date of SFAS No. 123R. Under the "modified retrospective" method, the requirements are the same as under the "modified prospective" method, but it also permits entities to restate financial statements of previous periods based on pro-forma disclosures made in accordance with SFAS No. 123. The adoption of SFAS No. 123 has no material impact on the Company's consolidated results of operations, financial condition, or cash flows.

FASB INTERPRETATION NO. 47, "ACCOUNTING FOR CONDITIONAL ASSET RETIREMENT OBLIGATIONS". In March 2005, the FASB issued FASB Interpretation ("FIN") No. 47, "Accounting for Conditional Asset Retirement Obligations." The interpretation clarifies the requirement to record abandonment liabilities stemming from legal obligations when the retirement depends on a conditional future event. FIN No. 47 requires that the uncertainty about the timing or method of settlement of a conditional retirement obligation be factored into the measurement of the liability when sufficient information exists. The Company adopted FIN No. 47 as of December 31, 2005. There was no material impact on the Company's consolidated results of operations, financial condition, or cash flows.

STATEMENT OF FINANCIAL ACCOUNTING STANDARDS NO. 154, "ACCOUNTING CHANGES AND ERROR CORRECTIONS, A REPLACEMENT OF APB OPINION NO. 20 AND FASB STATEMENT NO. 3". In May 2005, the FASB issued SFAS No. 154, "Accounting Changes and Error Corrections, a replacement of APB Opinion No. 20 and FASB Statement No. 3". SFAS No. 154 requires retrospective application to prior period financial statements for changes in accounting principle, unless it is impracticable to determine either the period-specific effects or the cumulative effect of the change. SFAS No. 154 also requires that retrospective application of a change in accounting principle be limited to the direct effects of the change. Indirect effects of a change in accounting principle should be recognized in the period of the accounting change. SFAS No. 154 will become effective for the Company's fiscal year beginning January 1, 2006. The impact of SFAS No. 154 will depend on the nature and extent of any voluntary accounting changes and correction of errors after the effective date, but management does not currently expect SFAS No. 154 to have a material impact on the Company's consolidated results of operations, financial condition, or cash flows.

EMERGING ISSUES TASK FORCE (EITF) ISSUE 04-13 "ACCOUNTING FOR PURCHASES AND SALES OF INVENTORY WITH THE SAME COUNTERPARTY". The Emerging Issues Task Force considered Issue No. 04-13 in its May 17, 2005 and June 16, 2005 meetings to discuss inventory sales to another entity in the same line of business from which it also purchases inventory. The Task Force reached consensus on the issue that purchases and sales of inventory with the same counterparty should be combined as a single non-monetary transaction (net) and noted factors that may

F-9

indicate that transactions were entered into in contemplation of one another. The Task Force ratified Issue No. 04-13 at its September 28, 2005 meeting, which should be applied to new arrangements entered into in the first interim or annual reporting period beginning after March 15, 2006. The Company does not expect Issue No. 04-13 to have a material impact on the Company's consolidated results of operations, financial condition, or cash flows.

3. NET LOSS PER SHARE

The Company applies SFAS No. 128, EARNINGS PER SHARE to compute net loss per share. In accordance with SFAS No. 128, basic net loss per share has been computed based on the weighted average of common shares outstanding during the years. Diluted net loss per share gives the effect of outstanding common stock equivalents in the form of detachable common warrants issued with the preferred stock and the convertible preferred stock. These common stock equivalents outstanding are convertible into 5,492,344 and 3,099,490 shares of common stock at January 31, 2006 and January 31, 2005, respectively. The effects on net loss per share of the common stock equivalents, however, are not included in the calculation of net loss per share since their inclusion would be anti-dilutive.

Net loss per common share has been computed as follows: 

 2006 2005
 ------------ ------------

Shares outstanding 17,263,140 16,790,127
 ============ ============

Weighted average 17,004,648 16,725,172
 ============ ============

Net loss $ (905,298) $ (1,436,378)

Preferred dividends in arrears 0 (689,277)
 ------------ ------------

Loss available to common shares $ (905,298) $ (2,125,655)
 ============ ============
Loss per common share:
Basic & fully diluted $ (0.05) $ (0.13)
 ============ ============

4. FIXED ASSETS

The following table is a summary of fixed assets at January 31, 2006 and at January 31, 2005: 

 2006 2005
 --------- ---------

PromotionStat software $ 89,778 $ 89,172
Lease Improvements 27,904 22,504
Furniture & Fixtures 30,174 30,176
Equipment 229,520 226,830
Accumulated depreciation (313,287) (269,691)
 --------- ---------

Fixed assets-net $ 64,089 $ 98,991
 ========= =========

F-10

5. STOCK WARRANTS OUTSTANDING

The following table summarizes the details of the number of warrants issued and outstanding, the weighted average exercise price of these warrants, and weighted average years remaining on these warrants. 

 Wgtd Avg
 Wgtd Avg Years to
 Amount Exercise Price Maturity
 ------ -------------- --------
Outstanding at February 1, 2004 1,678,056
 Issued 23,675
 Expired 0
 Exercised 0
 ---------

Outstanding at January 31, 2005 1,701,731 $5 1.54
 Issued 1,196,427
 Expired 0
 Exercised 0

 ---------
Outstanding at January 31, 2006 2,898,158 $5 2.56
 =========

The Company applied an option pricing model to determine the fair value of the detachable stock warrants issued with the convertible preferred stock in fiscal year 2006 and 2005. The following assumptions were used in the model. The dividend yield is 0%, volatility is 20%, and the risk-free interest rate is 3.50%. The fair values generated by the options pricing model may not be indicative of the future values, if any, that may be received by the warrant holder.

The Company allocated $244,058 and $4,829 of the proceeds received from the issuance of the preferred stock to additional paid in capital in fiscal years 2006 and 2005, respectively, as a result of the valuation of the warrants.

The Company has no formal stock option plan for employees.

F-11

6. INCOME TAXES

Provision for income taxes is comprised of the following: 

 2006 2005
 ----------- -----------

Net loss before provision for income taxes $ (913,975) $(1,076,464)
 =========== ===========
Current tax expense:
 Federal $ 0 $ 0
 State 0 0
 ----------- -----------
 Total $ 0 $ 0

Less deferred tax benefit:
 Timing differences (3,038,486) (2,567,128)
 Allowance for recoverability 3,038,486 2,567,128
 ----------- -----------
 Provision for income taxes $ 0 $ 0
 =========== ===========

A reconciliation of provision for income taxes at the statutory rate to provision for income taxes at the Company's effective tax rate is as follows: 

Statutory U.S. federal rate 34% 34%
Statutory state and local income tax 10% 10%
Less allowance for tax recoverability -44% -44%
 ----------- -----------
Effective rate 0% 0%
 =========== ===========

Deferred income taxes are comprised of the following: 

Timing differences $ 3,038,486 $ 2,567,128
Allowance for recoverability (3,038,486) (2,567,128)
 ----------- -----------
Deferred tax benefit $ 0 $ 0
 =========== ===========

Note: The deferred tax benefits arising from the timing differences expires in fiscal years 2020 to 2026 and may not be recoverable upon the purchase of the Company under current IRS statutes.

7. FAIR VALUES OF FINANCIAL INSTRUMENTS

The carrying amounts of cash and short term deposits, prepaid expense, and accounts payable and accrued expenses reported in the consolidated balance sheets are estimated by management to approximate fair value at January 31, 2006 and January 31, 2005.

F-12

8. ISSUANCES OF COMMON STOCK

During fiscal year 2006, the Company issued 35,485 shares of common stock to consultants for services rendered. In addition, the Company issued 437,528 shares of common stock to preferred A and preferred B stock holders to pay preferred dividends in arrears.

During fiscal year 2005, the Company issued 60,000 shares of common stock to consultants for services rendered. In addition, the Company issued 110,524 shares of common stock to preferred A and preferred B stock holders to pay preferred dividends in arrears.

9. ISSUANCES OF PREFERRED STOCK

CLASS A PREFERRED STOCK: Class A preferred stock has a stated value of $3 per share and a cumulative non-participating dividend of 13%. The Class A preferred stock is convertible into common stock at a conversion ratio of one preferred share for one common share. Each Class A preferred share includes one detachable common stock warrant. One common stock warrant is exercisable into one common share at an exercise price of $5 and expires five years from the date of its issuance.

CLASS B PREFERRED STOCK: Class B preferred stock has a stated value of $3 per share and a cumulative non-participating dividend of 6%. The Class B preferred stock is convertible into common stock at a conversion ratio of one preferred share for one common share. Each Class B preferred share includes one detachable common stock warrant. One common stock warrant is exercisable into one common share at an exercise price of $5 and expires five years from the date of issuance.

In fiscal year 2006, the Company issued 1,196,427 shares of preferred B and received net proceeds of $589,093. The Company applied $1,138,171 received in fiscal 2005 for the preferred B towards this issuance.

In fiscal year 2005, the Company issued 23,675 shares of preferred B and received net proceeds of $20,756.

At January 31, 2006 and January 31, 2005, the preferred dividends were in arrears for $-0- and $653,879, respectively.

10. RELATED PARTY TRANSACTIONS

During fiscal years 2006 and 2005, the Company paid a consulting firm that is owned by the chief executive officer, $160,778 and $207,775, respectively, for marketing, investor relations, business planning, financial services, and public relations consulting services.

During fiscal years 2006 and 2005, the Company sub-leased office space in New York, New York from a consulting firm that is the principle lessee of the office space. The company paid rent of $36,539 and $47,220 in fiscal years 2006 and 2005, respectively, for the space.

At January 31, 2005, the Company was indebted to an officer for $15,388. The loan was unsecured and due on demand. The loan was paid in 2006.

F-13

11. CONCENTRATION OF CREDIT RISK

At January 31, 2006 and January 31, 2005, cash on deposit with financial institutions in excess of insured amounts were $342,575 and $497,547, respectively. In the event of the insolvency of these financial institutions, the recovery of the Company's assets may be limited to a pro rata share of funds available.

All of the Company's revenues are software maintenance fees on the FX3000 received by contract arrangement from the joint venture, FX Direct Dealer, LLC. A discontinuation of this relationship would have a material adverse affect on the financial position of the Company.

12. GOING CONCERN

The accompanying consolidated financial statements have been presented in accordance with generally accepted accounting principals, which assume the continuity of the Company as a going concern. However, during the years ending January 31, 2006 and January 31, 2005, the Company has experienced, and continues to experience, certain going concern issues related to profitability.

13. COMMITMENTS AND CONTINGENCIES

The Company is committed to a non-cancelable lease for office space in New York City, New York expiring in 2012. Future minimum lease payments required under this lease is as follows: 

2007 $127,481
2008 131,306
2009 135,245
2010 139,302
2011 143,481
2012 24,448
 --------

Total $573,781
 ========

The Company currently sub leases this space to the joint venture company, FX Direct Dealer on a "month to month" basis. There was no rent expense from this space to the Company in fiscal 2006 and 2005.

The Company has deposited $45,000 as a security deposit on the office space described above. The deposit is non-interest bearing and is due at the termination of the lease.

DONAHUE ASSOCIATES, LLC

F-14
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