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

FORM 10-K/A
(Amendment No. 1)

(Mark One)

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

For the fiscal year ended December 31, 2011

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

Commission file number 000-29895

SMART-TEK SOLUTIONS INC.
(Name of small business issuer in its charter)

Nevada		98-0206542
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
1100 Quail Street, Suite 100, Newport Beach, California		92660
(Address of principal executive offices)		(Zip Code)

Issuer’s telephone number (858) 798-1644

Securities registered under Section 12(b) of the Exchange Act:

None		N/A
Title of each class		Name of each exchange on which registered
Securities registered under Section 12(g) of the Exchange Act:

Common Stock, $0.001 par value
(Title of class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes [  ]          No [X]

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act.

Yes [  ]          No [X]

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 [  ]

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Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes [X]          No [  ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§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 or any amendment to this Form 10-K.

[X]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [  ]	Accelerated filer [  ]
Non-accelerated filer [  ]	Smaller reporting company [X]

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

Yes [  ]          No [X]

As of December 31, 2011 (the last business day of the registrant’s year -end), the aggregate market value of the shares of the Registrant’s common stock held by non-affiliates (based upon the closing price of such shares as quoted on the Electronic Bulletin Board maintained by the National Association of Securities Dealers, Inc.) was approximately $726,409. Shares of the Registrant’s common stock held by each executive officer and director and each by each person who owns 10 percent or more of the outstanding common stock have been excluded in that such persons may be deemed to be affiliates of the Registrant. This determination of affiliate status is not necessarily a conclusive determination for other purposes.

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date. As of March 31, 2012, there were 49,212,123 shares of common stock, par value $0.001, outstanding

DOCUMENTS INCORPORATED BY REFERENCE

If the following documents are incorporated by reference, briefly describe them and identify the part of the Form 10-KSB (e.g., Part I, Part II, etc.) into which the document is incorporated: (1) any annual report to security holders; (2) any proxy or information statement; and (3) any prospectus filed pursuant to Rule 424(b) or (c) of the Securities Act of 1933 (“Securities Act”). The listed documents should be clearly described for identification purposes (e.g., annual report to security holders for fiscal year ended December 24, 1980). N/A

Transitional Small Business Disclosure Format (Check one): 

Yes [  ]          No [X]

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EXPLANATORY NOTE

Smart-tek Solutions, Inc. (the “Company”) is filing this Amendment No. 1(the “Form 10-K/A) to our Form 10-K for the year ended December 31, 2011(the “Form 10-K), filed with the U.S. Securities and Exchange Commission (“SEC”) on May 14, 2012, for the following purpose: to amend the filing to provide an audit report which covers the year ended December 31, 2010. As required by Rule 12b-15 under the Securities Exchange Act of 1934, as amended, new certifications by our principal executive officer and principal financial officer are being filed as exhibits to this Amendment No. 1. Except as described above, no other changes have been made to the 2011 Form 10K Annual Report. The 2011 Annual Report continues to speak as of the date of the 2011 Annual Report, and we have not updated the disclosures contained therein to reflect any events which occurred at a date subsequent to the filing of the 2011 Annual Report other than as expressly indicated in this Amendment No. 1.

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Smart-tek Solutions Inc.
Period Ended December 31, 2011 and 2010

PART I -- FINANCIAL INFORMATION
CONTENTS	PAGES
AUDITOR’S REPORTS	2
FINANCIAL STATEMENTS
Consolidated Balance Sheets	4
Consolidated Statements of Operations and Comprehensive Income	5
Consolidated Statements of Changes in Stockholders’ Equity (Deficit)	6
Consolidated Statements of Cash Flows	7
Notes to the Consolidated Financial Statements	8 - 19

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AUDITOR’S REPORT

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and
Stockholders of Smart-Tek Solutions, Inc.

We have audited the accompanying consolidated balance sheet of Smart-Tek Solutions, Inc. as of December 31, 2011 and the related statements of operations and comprehensive income, stockholders’ equity (deficit), and cash flows for the year ended December 31, 2011. Smart-Tek Solutions, Inc.’s management is responsible for these consolidated financial statements. Our responsibility is to express an opinion on these consolidated financial statements based on our audit. The consolidated financial statements of Smart-Tek Solutions, Inc. as of December 31, 2010 were audited by other auditors whose report dated May 11, 2012 expressed an unqualified opinion on those statements.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. The company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Smart-Tek Solutions, Inc. as of December 31, 2011 and the results of its operations and its cash flows for the year ended December 31, 2011 in conformity with accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has sustained recurring losses from operations and has an accumulated deficit of approximately $13 million at December 31, 2011. These factors raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in this regard are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ PMB Helin Donovan, LLP

PMB Helin Donovan, LLP
Dallas, Texas
May 11, 2012

2

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FINANCIAL STATEMENTS
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To: The Board of Directors and Shareholders
        Smart-tek Solutions, Inc. (formerly Royce Biomedical Inc.)

I have audited the accompanying consolidated balance sheet of Smart-tek Solutions, Inc. and subsidiary (the Company) as of December 31, 2010 and the related consolidated statements of operations and cash flows for the year ended December 31, 2010. These consolidated financial statements are the responsibility of the Company’s management. My responsibility is to express an opinion on these consolidated financial statements based on my audit.

I conducted my audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor was I engaged to perform, an audit of its internal control over financial reporting. My audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but do not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, I express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe that my audit provides a reasonable basis for my opinion.

In my opinion the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Smart-tek Solutions, Inc. and its subsidiaries as of December 31, 2010, and the results of their operations and cash flows for the year ended December 31, 2010, in conformity with accounting principles generally accepted in the United States of America.

/s/ John Kinross-Kennedy

John Kinross-Kennedy
Certified Public Accountant
Irvine, California
May 11, 2012

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Smart-tek Solutions Inc. Consolidated Balance Sheets As of December 31, 2011 and 2010
		December 31,			December 31,
		2011			2010
Assets
Current assets
Cash and cash equivalents	$	132,492		$	781,720
Accounts receivable, net		1,626,583			1,689,986
Due from related parties		2,739,220			-
Prepaid expenses and deposits		52,152			69,094
Total current assets		4,550,447			2,540,800
Equipment, net of accumulated depreciation		55,007			47,501
Prepaid workers compensation		3,440,000			2,345,877
Goodwill		476,356			-
	$	8,521,810		$	4,934,178
Liabilities
Current liabilities
Accounts payable and accrued liabilities	$	1,268,378		$	2,356,739
Accrued payroll taxes		11,958,012			1,414,032
Accrued workers compensation		1,055,980			-
Payable to related parties		609,022			388,415
Note payable to related party		500,000			-
Total current liability		15,391,392			4,159,186
Other long-term liabilities		35,000			-
Total liabilities		15,426,392			4,159,186
Commitments and contingencies		-			-
Stockholders’ Equity (Deficit)
Preferred stock: $0.001 par value, 5,000,000 shares authorized, zero shares of Class A preferred issued and outstanding at December 31, 2011 and 2010		-			-
Common stock: $0.001 par value, 500,000,000 shares authorized, 49,212,123 and 24,314,124 issued and outstanding at December 31, 2011 and 2010, respectively		49,212			24,315
Additional paid in capital		7,271,945			6,852,863
Accumulated deficit		(14,225,739	)		(6,102,186	)
Total stockholders’ equity (deficit)		(6,904,582	)		774,992
	$	8,521,810		$	4,934,178

See accompanying notes to the consolidated financial statements.

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Smart-tek Solutions Inc.
Consolidated Statements of Operations and Comprehensive Income
For the years ended December 31, 2011 and 2010
		2011			2010
Revenue (gross billings of $97.394 and $68.556 million, less worksite employee payroll cost of $75.646 million and $51.33 million respectively)	$	21,748,488		$	17,226,416
Cost of revenue and service delivery		20,805,474			13,321,537
Gross profit		943,014			3,904,879
Selling, general and administrative expenses		6,953,960			3,161,877
Operating income (loss)		(6,010,946	)		743,002
Other Income (expense)
Interest		(192,304	)		(21,914	)
Tax penalties		(1,744,050	)		-
Legal Settlement		(180,000	)		-
Other income/(expense)		3,747			-
Total other expense		(2,112,607	)		(21,914	)
Net income (loss) from continuing operations		(8,123,553	)		721,088
Net income from discontinued operations		-			134,100
Comprehensive income (loss)	$	(8,123,553	)	$	855,188
Earnings per share of common stock, basic and diluted	$	(0.21	)	$	0.01
Weighted average shares of common stock outstanding, basic and diluted		38,025,077			64,505,905

See accompanying notes to the consolidated financial statements.

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Smart-tek Solutions Inc.
Consolidated Statement of Changes in Stockholders’ Equity (Deficit)

		Common			Stock			Additional
								Paid in			Accumulated
		Shares			Amount			Capital			Deficit			Total
Balance – December 31, 2009 (unaudited)		69,314,124		$	69,315		$	6,852,863			($6,957,374	)		($35,196	)
Shares cancelled for amended Marketing Partner Agreement		(45,000,000	)		(45,000	)		-			-			(45,000	)
Net income		-			-			-			855,188			855,188
Balance – December 31, 2010		24,314,124			24,315			6,852,863			(6,102,186	)		774,992
Share-based compensation		24,897,999			24,897			419,082			-			443,979
Net loss		-			-			-			(8,123,553	)		(8,123,553	)
Balance - December 31, 2011		49,212,123		$	49,212		$	7,271,945			($14,225,739	)		($6,904,582	)

See accompanying notes to the consolidated financial statements.

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Smart-tek Solutions Inc. Consolidated Statements of Cash Flows For the Years Ended December 31, 2011 and 2010
		2011			2010
Operating Activities
Net income (loss)	$	(8,123,553	)	$	855,188
Adjustments to reconcile net income (loss) to cash provided in operating activities
Depreciation and amortization		20,214			22,363
Share based compensation expense		443,979			(45,000	)
Miscellaneous assets		(11,356	)		-
Provision for doubtful accounts		150,000			-
Changes in operating assets and liabilities
Accounts receivable		(86,597	)		(1,456,753	)
Due from related party		(2,739,220	)
Proceeds from related party		220,607			388,415
Prepaid expenses and deposits		16,942			(785,328	)
Prepaid worker compensation expense		(1,094,123	)		-
Payroll taxes payable		10,440,980			-
Accrued workers compensation		1,055,980
Accounts payable and accrued liabilities		(950,361	)		1,846,175
Net cash provided (used) by operating activities		(656,508	)		825,060
Investing activities
Purchase of equipment		(27,720	)		(38,532	)
Cash paid in purchase of Solvis Medical Group assets		35,000			-
Net cash used in investing activities		7,280			(38,532	)
Financing activities
		-			-
Net cash provided by (used in) financing activities		-			-
Net increase (decrease) in cash from continuing operations		(649,228	)		786,528
Net increase (decrease) in cash from discontinued operations		-			(239,364	)
		78
Cash and cash equivalents, beginning of the year		1,720			234,552
Cash and cash equivalents, end of the year	$	132,492		$	781,720
Supplemental cash flow information
Interest paid	$	194,304		$	21,914
Income taxes payable	$	-		$	-
Non cash supplemental information
Note payable - purchase of Solvis Medical Group assets	$	500,000		$	-

See accompanying notes to the consolidated financial statements.

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1.	Summary of significant accounting policies

Nature of operations, basis of financial statement presentation

Smart-tek Solutions Inc. (“the Company”) was incorporated in the State of Nevada on March 22, 1995.

In August 2005, the Company changed its name from Royce Biomedical Inc. to Smart-tek Solutions Inc. (“STS” or the “Company”) to better reflect its new business activities.

In March 2005, the Company entered into a Letter of Intent to acquire Smart-tek Communications, Inc. (“SCI”) a British Columbia based security design and installation contractor. Pursuant to a Share Exchange Agreement executed in April 2005, SCI became a wholly-owned subsidiary of the Company.

On July 1, 2010, the Company completed the disposition of the Company’s wholly-owned subsidiary SCI to its president and founder Perry Law.

On February 11, 2009, Smart-tek Automated Services Inc., a wholly-owned subsidiary of the Company, was incorporated in the State of Nevada for the purpose of adding a yet to be determined new business line. On June 17, 2009, Brian Bonar was contracted to use his expertise and contacts in the PEO area for the benefit of Smart-tek Automated Services, Inc. Smart-tek Automated Services Inc. provides integrated and cost-effective management solutions in the area of human resources for public and private companies. Though Smart-tek Automated Services Inc., provides mainly professional employer organization (“PEO”) services, it is equipped to provide temporary staffing services as well. In a PEO co-employment contract, the Company becomes the employer of record for client company employees’ for tax and insurance purposes. The client company continues to direct the employees’ day-to-day activities, and charges a service fee for providing services. 100% of Smart-tek Automated Services Inc.’s operations are in the United States.

On October 1, 2011 Smart-tek Solutions, Inc. purchased the assets and brand name of Solvis Medical Group from American Marine LLC dba AMS Outsourcing a Montana limited liability corporation. The asset has three distinct business lines: Solvis Medical Staffing and Solvis Medical provide medical staffing services to hospitals, medical clinics, surgical centers, and skilled nursing facilities; and, in certain cases, nursing care to patients in their homes. Solvis Physical Therapy, Inc. is a licensed provider of physical therapy services, but is currently inactive.

The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and include the following significant accounting policies:

Liquidity and Management Plans

At December 31, 2011, the Company had cash and cash equivalents of approximately $132,492, a working capital deficit of approximately $10.8 million and an accumulated deficit of $14.2 million. Due to these circumstances, the Company’s management monitors and attempts to minimize, to the extent possible, all cash expenditures. The Company plans to seek additional funds, equity or debt, to support its operations. The Company’s management believes it will generate sufficient additional revenues to meet its working capital needs in future periods.

Going Concern

The Company incurred a net operating loss of approximately $8.13 million for the year ended December 31, 2011, and has incurred accumulated losses totalling approximately $14.2 million through December 31, 2011. Because of these conditions, the Company will require additional working capital to continue operations and develop its business. The Company intends to raise additional working capital either through private placements, public offerings and/or bank financing, and continues to strive to increase its revenues each year.

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Going Concern - continued

There are no assurances that the Company will be able to achieve a level of revenues adequate to generate sufficient cash flow from operations or obtain additional financing through private placements, public offerings and/or bank financing necessary to support the Company’s working capital requirements. To the extent that funds generated from any private placements, public offerings and/or bank financing are insufficient the Company will have to raise additional working capital. No assurance can be given that additional financing will be available, or if available, will be on terms acceptable to the Company. If adequate working capital is not available, the Company may not continue its operations or execute its business plan.

These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Principles of consolidation

The consolidated financial statements include the accounts of Smart-tek Solutions Inc. and its wholly-owned subsidiary Smart-tek Automated Services Inc. Significant inter-company transactions have been eliminated in consolidation.

Use of estimates

The preparation of these consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect reported amounts and related disclosures. Specific areas, among others, requiring the application of management’s estimates and judgment includes assumptions pertaining to credit worthiness of customers, interest rates, useful lives of assets, future cost trends, tax strategies, and other external market and economic conditions. Actual results could differ from estimates and assumptions made.

Cash and equivalents

Cash and cash equivalents consist of cash on hand and bank deposits. For financial reporting purposes, the Company considers all highly liquid debt instruments with original maturities of three months or less to be cash equivalents. The Company maintains its cash in bank deposit accounts, which at times, may exceed federally insured limits. The Company has not experienced any losses related to this concentration of risk. At December 31, 2011 and 2010, the Company did not have any deposits in excess of federally insured limits.

Accounts Receivable

Accounts receivables are recorded at net realizable value consisting of the carrying amount less an allowance for uncollectible accounts, as needed. The Company uses the allowance method to account for uncollectible accounts receivable balances. Under the allowance method, if needed, an estimate of uncollectible customer balances is made based upon specific account balances that are considered uncollectible. Factors used to establish an allowance include the credit quality and payment history of the customer. The allowance for doubtful accounts was $ 150,000 and zero as of December 31, 2011 and 2010, respectively.

The Company regularly discounts selected trade accounts receivable from clients to a commercial factoring company. Under the terms of the factoring agreement, the factor remits the invoiced amounts to the Company less a portion for reserves. When paid in full, the factor remits the reserve amount less a portion for processing fees and interest. Accounts are factored with recourse as to credit losses. The Company reflects a liability to the factoring company on its Balance Sheet for the uncollected amounts that remain uncollected until the factored invoices have been paid in full.

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Workers compensation insurance

The Company maintains reserves in the form of prepaid cash deposits for known workers' compensation claims which are made up of estimated collateral required to pay claims and estimated expenses to settle the claims. The collateral amounts are determined by the insurance carrier and are not recoverable by the Company until all claims related to a policy period are settled.

The prepaid cash deposits will not be recoverable in the near term and accordingly, they are classified as a long term asset. The Company reserves prepaid cash deposits for claims incurred but not reported (IBNR). This is an estimated liability based upon evaluation of information provided by our internal claims adjusters and our third-party administrators`. Included in these liabilities are case reserve estimates for the costs of the claim, administrative costs as well as legal costs. These estimates are continually reviewed and adjustments to liabilities are reflected in current operating results as they become known.

Concentration of credit risk

Credit risk arises from the potential that a counterpart will fail to perform its obligations. The Company is exposed to credit risk related to its accounts receivable. The Company’s receivables are comprised of a number of debtors which minimizes the concentration of credit risk. It is management’s opinion that the Company is not exposed to significant credit risk associated with its accounts receivable.

Equipment

Equipment is recorded at cost and depreciated using accelerated methods over the estimated useful lives of the related assets ranging from 3 to 5 years. The Company reviews the carrying value of long-term assets to be held and used when events and circumstances warrant such a review. If the carrying value of a long-lived asset is considered impaired, a loss is recognized based on the amount by which the carrying value exceeds the fair market value. Fair market value is determined primarily using the anticipated cash flows discounted at a rate commensurate with the risk involved. The cost of normal maintenance and repairs is charged to operations as incurred. Major overhaul that extends the useful life of existing assets is capitalized. When equipment is retired or disposed, the costs and related accumulated depreciation are eliminated and the resulting profit or loss is recognized in income.

Income taxes

The Company recognizes consolidated deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are determined based on the difference between the tax basis of assets and liabilities and their financial reporting amounts based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income.

Deferred tax assets are recognized for deductible temporary differences and for carry forwards. Deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized.

Revenue recognition

The Company recognizes professional employment organizations (PEO) revenues when each periodic payroll is delivered. The Company’s net PEO revenues and cost of PEO revenues do not include the payroll cost of its worksite employees. Instead, PEO revenues and cost of PEO revenues are comprised of all other costs related to its worksite employees, such as payroll taxes, employee benefit plan premiums and workers’ compensation insurance. PEO revenues also include professional service fees, which are primarily computed as a percentage of client payroll or on a per check basis. Revenues related to the Solvis staffing business are recognized when the services are invoiced to the client.

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Revenue recognition - continued

In determining the pricing of the markup component of its billings, the Company takes into consideration its estimates of the costs directly associated with its worksite employees, including payroll taxes, benefits and workers’ compensation costs, plus an acceptable gross profit margin. As a result, the Company’s operating results are significantly impacted by the Company’s ability to accurately estimate, control and manage its direct costs relative to the revenues derived from the markup component of the Company’s gross billings.

Goodwill

The Company’s goodwill was derived from the acquisition of Solvis assets. Goodwill is the excess of cost over the fair market value of net tangible assets acquired. Goodwill is not amortized but tested for impairment on an annual basis or if certain circumstances indicate a possible impairment may exist.

Share-based compensation

The Company measures the cost of employee services received in exchange for equity awards based on the grant date fair-value of the awards. Fair value is typically the market price of the shares on the date of issuance. Costs are recognized as compensation expense over the vesting period of the awards. Under this method, the Company began recognizing compensation cost for equity-based compensation for all new or modified grants after the date of adoption. The pro-forma disclosures previously permitted under SFAS No. 123 are no longer an alternative to financial statement recognition.

Earnings (loss) per share

The Basic net earnings (loss) per common share is computed by dividing the net earnings (loss) available to common stock outstanding during the period. Net earnings (loss) per share on a diluted basis is computed by dividing the net earnings (loss) for the period by the weighted average number of common and dilutive common stock equivalent shares outstanding during the period.

Fair Value of Financial Instruments

Fair value is determined to be the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. The Company follows a fair value hierarchy that prioritizes the inputs used in measuring fair value into three broad levels as follows:

Level 1—Quoted prices in active markets for identical assets or liabilities.

Level 2—Inputs, other than the quoted prices in active markets, are observable either directly or indirectly.

Level 3—Unobservable inputs based on the Company's assumptions.

The Company is required to use observable market data if such data is available without undue cost and effort.

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Fair Value of Financial Instruments - continued

At December 31, 2011 and 2010, the carrying amounts of financial instruments, including cash, accounts and other receivables, accounts payable and accrued liabilities, and accounts payable to related parties approximate fair value because of their short maturity.

Recent Accounting Pronouncements

In December 2010, the Financial Accounting Standards Board (“FASB”) issued FASB Accounting Standards Update No. 2010-28 “Intangibles— Goodwill and Other (Topic 350): When to Perform Step 2 of the Goodwill Impairment Test for Reporting Units with Zero or Negative Carrying Amounts” (“ASU 2010-28”). Under ASU 2010- 28, if the carrying amount of a reporting unit is zero or negative, an entity must assess whether it is more likely than not that goodwill impairment exists. To make that determination, an entity should consider whether there are adverse qualitative factors that could impact the amount of goodwill, including those listed in ASC 350-20-35-30. As a result of the new guidance, an entity can no longer assert that a reporting unit is not required to perform the second step of the goodwill impairment test because the carrying amount of the reporting unit is zero or negative, despite the existence of qualitative factors that indicate goodwill is more likely than not impaired. ASU 2010-28 is effective for fiscal years, and for interim periods within those years, beginning after December 15, 2010, with early adoption prohibited. Adoption of this guidance did not have any impact on its consolidated financial position, results of operations, or cash flows.

In June 2011, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2011-05, “Comprehensive Income: Presentation of Comprehensive Income.” This new guidance requires the components of net income and other comprehensive income to be presented in one continuous statement, referred to as the statement of comprehensive income, or in two separate consecutive statements. The new guidance also eliminates the current option to report other comprehensive income and its components in the statement of stockholders’ equity. While the new guidance changes the presentation of comprehensive income, there are no changes to the components that are recognized in net income or other comprehensive income under current accounting guidance. ASU 2011-05 is effective for periods beginning after December 15, 2011; however, the Company has adopted this guidance as of the end of its 2011 reporting period as permitted by the guidance.

In September 2011, the FASB issued Accounting Standards Update (“ASU”) No. 2011-08 Intangibles – Goodwill and Other (Topic 350) Testing Goodwill for Impairment. The ASU simplifies how entities, both public and non-public, test goodwill for impairment. The revised standard allows an entity to first assess qualitatively whether it is necessary to perform step one of the two-step annual goodwill impairment test. An entity is required to perform step one only if the entity concludes that it is more likely than not that a reporting unit’s fair value is less than its carrying amount, a likelihood of more than 50 percent. An entity can choose to perform the qualitative assessment on none, some, or all of its reporting units. Moreover, an entity can bypass the qualitative assessment for any reporting unit in any period and proceed directly to step one of the impairment test, and then perform the qualitative assessment in any subsequent period. The revised standard is effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011 and early adoption is permitted. The Company does not believe this guidance will have any impact on its consolidated financial position, results of operations, or cash flows.

Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the AICPA, and the SEC did not or are not believed by management to have a material impact on the Company's present or future consolidated financial statements.

2.	Discontinued operations

On July 1, 2010, the Company completed the sale of the Company’s wholly-owned subsidiary Smart-tek Communications Inc. to its president and founder Perry Law.

The aggregate purchase price of Smart-tek Communications, Inc. is $821,757 allocated as follows:

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2.	Discontinued operations – continued
	(a)	$821,756 of the purchase price shall be paid and satisfied by setting-off the Company’s indebtedness to Perry Law; and
	(b)	$1.00 of the purchase price shall be paid by Perry Law for transferring 32,817 shares owned by him to the Company.

Results of operations and cash flows are classified as pertaining to “discontinued operations” if those operations and cash flows are attributable to a distinguishable component of the Company that will be eliminated from the ongoing operations of the Company as a result of the disposition.

The results of discontinued operations are classified separately in both the current period and prior years. The results of discontinued operations are presented net of applicable income taxes.

If certain long-term assets and liabilities of the Company can be distinguished as being directly related to the discontinued operations, and if those assets and liabilities are disposed of pursuant to the disposition of the discontinued business component, then those assets and liabilities are classified on the consolidated balance sheet in both the current and prior periods as current or non-current assets of discontinued operations and liabilities of discontinued operations, respectively.

Current and non-current assets and liabilities of discontinued operations are re-measured at the time of discontinuation at the lower of their carrying amount or their fair value less cost to sell. Any resultant unrealized gains or losses are recognized in net income in the period when the Company disposes the related operations.

The following table presents the effect of the discontinued operations in the Consolidated Statements of Operations and Comprehensive Income:

		2011			2010
Revenue	$	-		$	-
Cost of revenue and service delivery		-			-
Gross profit		-			-
Selling, general and administrative expenses		-			-
Operating income		-			-
Other expense
Interest expense		-			-
Gain on disposition of discontinued operations		-			339,641
Net income from discontinued operations	$	-		$	339,641

The effect on the stockholders’ deficit was $0 and $339,641 for the years ending December 31, 2011 and December 31, 2010 respectively.

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3.

Equipment

		Cost			Accumulated Depreciation			December 31, 2011 Net Book Value			Cost			Accumulated Depreciation			December 31, 2010 Net Book Value
Computer equipment & software	$	55,008		$	20,574		$	34,434		$	28,882		$	9,628		$	19,254
Office furniture & equipment		19,334			7,397			11,937			12,993			8,008			4,985
Automobile		23,242			14,606			8,636			27,989			4,727			23,262
	$	97,584		$	42,577		$	55,007		$	69,864		$	22,363		$	47,501

Depreciation and amortization of property and equipment was $20,214 and $22,363 for the years ended December 31, 2011 and 2010 respectively.

4.	Income taxes

The Company regularly assesses uncertain tax positions in each of the tax jurisdictions in which it has operations and accounts for the related financial statement implications. Unrecognized tax benefits are reported using the two-step approach under which tax effects of a position are recognized only if it is “more-likely-than-not” to be sustained and the amount of the tax benefit recognized is equal to the largest tax benefit that is greater than fifty percent likely of being realized upon ultimate settlement of the tax position. Determining the appropriate level of unrecognized tax benefits requires the Company to exercise judgment regarding the uncertain application of tax law. The amount of unrecognized tax benefits is adjusted when information becomes available or when an event occurs indicating a change is appropriate. Future changes in unrecognized tax benefits requirements could have a material impact on the results of operations. The Company files U.S. federal and U.S. state tax returns.

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4.	Income taxes - continued

The Company generated a deferred tax credit through net operating loss carry forwards. As of December 31, 2011 the company had federal and state net operating loss carry forwards of $14,161,666 that can be used to offset future federal and state income tax. The federal and state net operating losses are reduced by a valuation allowance, when, in the opinion of management, utilization is not reasonably assured. A valuation allowance of 100% has been established; based on it is more likely than not that some portion or all of the deferred tax credit will not be realized.

At December 31, 2011, STTN had available federal net operating loss (NOL) carry forwards of $8,375,878. Under Section 382 of the internal Revenue Code of 1986, as amended, the use of prior losses including NOLs is subject to rules if a corporation undergoes an “ownership change”. Future issuances of equity interests by us for acquisitions or the exercise of outstanding options to purchase our capital stock may result in an ownership change that is large enough for a limitation on the use of NOLs to apply. If the limitation applies, we may be unable to use a material portion of its available NOL carry forwards to reduce future taxable income. The income tax effect of temporary differences between financial and tax reporting gives rise to the deferred tax asset at December 31, 2011 and 2010 as follows:

		December 31,			December 31,
		2011			2010
Deferred tax asset, beginning	$	1,946,027		$	2,245,343
Provision of current year’s operating gain		985,531			(299,316	)
Gross deferred tax asset, ending	$	2,931,558		$	1,946,027
Valuation allowance, beginning	$	(1,946,027	)	$	(2,45,313	)
Current year’s gain provision		(985,531	)		299,316
Valuation allowance, ending	$	(2,931,558	)	$	(1,946,027	)
Deferred tax asset, net	$	-		$	-
Tax at blended U.S./Canadian statutory rates		(35%	)		(35%	)
Loss carryover		35%			35%
Tax expense	$	-		$	-

As of December 31, 2011 the Company had accrued Federal and State withholding taxes of $11,958,012 versus $1,414,032 as of December 31, 2010. Of the $11,958,012 at December 31, 2011, $6,667,132 is related to Federal and State Withholding Taxes Q4, 2011, $1,744,050 in penalties, and $3,516,689 relates to the first three quarters of 2011.

The Company has paid the various State tax obligations in early 2012, and is developing a payment plan with the IRS for past due federal withholding tax obligations. The Company is current will all its federal tax liabilities for the first quarter ended March 31, 2012.

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5.

Equity

At December 31, 2011, the Company is authorized to issue:

	1.	5,000,000 shares of preferred stock, par value $0.001 per share.
	2.	500,000,000 shares of common stock, par value $0.001 per share.

Common Stock

At December 31, 2011, there are 49,212,123 shares of common stock outstanding.

On June 16, 2011 the Board of Directors approved the Smart-tek Solutions 2011 Stock Compensation Plan (“2011 Plan”) authorizing the sale or award of up to an additional 10,000,000 shares and/or options of the Company's Common Stock. The Stock Option Plan expires in August 20, 2013. No stock options were issued during 2011. During 2011, 3,000,000 shares were issued to a consultant as compensation for services rendered. The cost of these shares was measured at the market value of $.075 per share or $225,000 and expensed at the time of issuance. The value in excess of Par Value was recognized as Additional Paid In Capital. 7,000,000 share and/or options of the Company’s common stock are available for issuance under the 2011 Plan as of December 31, 2011.

Preferred Shares

There are no preferred shares issued or outstanding.

6.	Earnings (loss) per share
			2011			2010
	Net income (loss)	$	(8,123,553	)	$	855,188
	Weighted number of shares outstanding		38,025,077			64,505,905
	Income(loss) per share	$	(0.21	)	$	0.01

7.	Acquisitions

On October 1, 2011, Smart-tek Solutions, Inc. acquired the assets and the brand name of Solvis Medical Group from American Marine LLC dba AMS Outsourcing, a Montana limited liability corporation.

The purchase price was $535,000 consisting of a $35,000 cash payment at closing plus a $500,000 promissory note that matures on September 31, 2012 and bears a 6% simple interest rate. The purchase price will be revalued at the one and two year time periods based on performance as follows:

• Year 2012 – At December 31, 2012, the acquired net assets will be revalued at four (4) times pretax earnings. A one year promissory note at 6% interest will be issued for the net change between the original value and the 2012 revalue.

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7.	Acquisitions - continued

• Year 2013 - At December 31, 2013, the acquired net assets will be revalued at four (4) times pretax earnings. A one year promissory note at 6% interest will be issued for the net change between the revalue as of December 31, 2012 and the revalue at December 31, 2013 .

The Company recorded the purchase price as follows:

Management does not believe that the calculation of 4 times earnings will exceed the purchase price of $535,000.

8.	Short Term Note Payable

At December 31, 2011, the Company has an outstanding note payable in the amount of $500,000 payable to an affiliated company relating to the acquisition of Solvis Medical Group assets. The loan is unsecured, bears a simple 6% interest and matures at September 30, 2012.

9.	Related Party Transactions

During the year ended December 31, 2011, Smart-tek Communications Inc. (a wholly-owned subsidiary) paid $1,485,097 in management salaries to its President and Vice President which included commissions of $434,312 and benefits of $348,297. Such Costs have been reflected in the accompanying statement of operations.

From time to time, Smart-tek Automated Services Inc. purchases additional services from related parties to take advantage of economies of scale as opposed to maintaining full time staff and resources within its own operations. Likewise, Smart-tek Automated services shares its own resources with these same related parties again to leverage economies of scale.

During the year ended December 31, 2011, Smart-tek Automated Services Inc. (a wholly-owned subsidiary) paid consulting fees of $515,693 to a company controlled by an officer of the Company for Financial, HR and Legal Services. Such costs have been reflected in the accompanying statement of operations.

Smart-tek additionally pays certain fees to another related party for the sharing to office space and utilities. These expenses, which are relatively small, are included in the accompanying statement of operations and were based upon actual usage or allocations agreed to by management personnel.

Following is a summary of the balances both Due To and From these related parties as of December 31, 2011 which in some cases is an accumulation over several years of activity:

		Due From			Due To
Due From Allegiant Professional Services	$	2,132,027		$	89,542
Due From American Marine Services	$	280,781		$	352,225
Due From Dalrada Financial Services	$	275,900		$	127,472
Note Receivable Related Party	$	50,512			-
Other		-		$	39,783
Total Due from Related Parties	$	2,739,220		$	609,022

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9.	Related Party Transactions- continued

Amounts due to officers and directors were $0 and $388,415 as of December 31, 2011 and 2010 respectively.

10.	Commitments

Operating leases

The Company’s wholly owned subsidiary Smart-tek Automated Services Inc. entered into non-cancellable operating leases for office space on March 1, 2008 for its China Mart sales office in July of 2009 and Solvis medical staffing office in Michigan in June, 2011. Both leases expire in 2012. The minimum payments required under these operating leases for the remaining term of the lease subsequent to December 31, 2011 are approximately as follows:

Rental expenses were $61,708 and $38,560 for the years ended December 31, 2011 and 2010 respectively.

Marketing partner agreement

On December 9, 2010, the board of Smart-tek Solutions Inc. (“Smart-tek”) amended the marketing agreement entered into on June 17, 2009 in order to clarify basis for calculating the shares to be issued for compensation pursuant to the marketing agreement. The agreement was between Smart-tek Solutions Inc., it’s wholly owned subsidiary Smart-tek Automated Services, Inc., and its affiliated businesses (hereinafter collectively referred to as the “Company”) and, Brian Bonar, an individual (hereinafter referred to as the “Marketing Partner”)

Pursuant to the terms of the amended marketing agreement, Brian Bonar agreed to provide certain services to Smart-tek Automated to promote and market the new business of Smart-tek to prospective clients, in consideration of which Smart-tek agreed to pay Mr. Bonar a commission consisting of the following: For each US$1,000,000 in actual net sales of the Company subsequent to the first aggregate of US $20,000,000 in actual net sales and up to the first aggregate of US $30,000,000 in actual net sales of the Company, introduced by Marketing Partner to the Company (the “Client Contacts”), Marketing Partner will receive 4,500,000 Shares without further compensation. The maximum aggregate Shares that may be issued to the Marketing Partner under the Agreement are 45,000,000 Shares.

After an aggregate of US$30,000,000 in actual net sales is reached by the Company resulting from Client contacts introduced by Marketing Partner to the Company, Marketing Partner will receive two percent (2%) of annual net revenues of the Company for the amounts in excess of US$5,000,000 of actual net revenues in any given fiscal year in cash.

On June 13, 2011, pursuant to the above agreement 21, 897 999 shares of restricted common stock were issued to Mr. Bonar.

The agreement is for an indefinite term and may be terminated by either party without cause on 30 days written notice.

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10.	Commitments - continued

Settlement agreement

In July, 2009 Smart-tek negotiated a settlement with Richardson & Patel LLP pursuant to the terms of which the Company would be required to pay Richardson & Patel $10,000 per month, commencing August 1, 2009, until payments in the aggregate of $200,000 were made in full and final settlement of all claims that the firm had or may have had against the Company with respect to certain outstanding accounts owed by the Company to the firm totaling approximately $315,000 for legal services rendered. In connection with the settlement, Richardson & Patel requested that the parties enter into a stock pledge agreement pursuant to which Perry Law (1,829 shares pledged), P5 Holdings Ltd (30,984 shares pledged), Agri-Tech Marketing (22,000 shares pledged), Donald Gee (40,000 shares pledged) and Joe Law (21,795 shares pledged) would pledge an aggregate of 116,608 (post-split) shares of the Company issued and outstanding common stock as security for repayment of the amounts owed to Richardson & Patel. As of the date of this Annual Report: there has been no settlement of all amounts owed to Richardson & Patel, Richardson & Patel received and continues to hold the pledged shares and the Company has not made any payments to Richardson & Patel. The Company has not recorded any liability related to this settlement at either December 31, 2011 or 2010 respectively.

12.	Subsequent events

On February 24, 2012 the Company entered into a Joint Settlement Agreement with AmeriFactors relating to a lawsuit between the two companies whereby Smart-tek would pay AmeriFactors the sum of $180,000, to be paid in the following manner:

1)	One payment of $25,000 upon execution of the Settlement Agreement
2)	Fifteen monthly payments of $10,000 due on the first day of each respective month with the first such payment due March 1, 2012
3)	The final payment of $5,000.

The Company has recorded the full $180,000 obligation as of December 31, 2011 of which $145,000 is a current liability and $35,000 is non-current.

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PART IV

ITEM 15.

EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

*Filed herewith

SIGNATURES

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

SMART-TEK SOLUTIONS INC.

By	/s/ Brian Bonar                                                                          Brian Bonar Chief Executive Officer, Chief Financial Officer and Director (Principal Executive Officer, Principal Accounting Officer and Principal Financial Officer)
Date:	August 30, 2012

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

By	/s/ Brian Bonar                                                                          Brian Bonar Chief Executive Officer, Chief Financial Officer and Director (Principal Executive Officer, Principal Accounting Officer and Principal Financial Officer)
Date:	August 30, 2012

	/s/ Owen Naccarato                                                                     Owen Naccarato Director
Date:	August 30, 2012

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