BTCS Inc. - FORM 10-Q/A - January 28, 2014

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EXCEL - IDEA: XBRL DOCUMENT - BTCS Inc.	Financial_Report.xls
EX-31.1 - CERTIFICATION - BTCS Inc.	f10q0613a4ex31i_touchit.htm
EX-32.1 - CERTIFICATION - BTCS Inc.	f10q0613a4ex32i_touchit.htm
EX-32.2 - CERTIFICATION - BTCS Inc.	f10q0613a4ex32ii_touchit.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q/A

Amendment Number 4

x QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2013

¨ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from _________ to _____________

Commission file number 333-151252

TouchIT Technologies, Inc.

(Exact Name of Registrant as Specified in Its Charter)

Nevada		26-2477977
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

101 West Big Beaver Road, Suite 1400, Troy, MI, 48084, USA

(Address of Principal Executive Offices) (Zip Code)

248 764 1084

(Registrant’s Telephone Number, Including Area Code)

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 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 ¨ No ¨

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 definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Larger accelerated filer ¨	Accelerated filer ¨
Non-accelerated filer ¨ (Do not check if a smaller reporting company)	Smaller reporting company x

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

Yes ¨ No x

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: 228,064,419 shares of common stock outstanding as of August 13, 2013.

TOUCHIT TECHNOLOGIES, INC.

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2013

INDEX

PART I - FINANCIAL INFORMATION

Item 1.	Financial Statements.	4

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations.	8

Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	15

Item 4.	Controls and Procedures.	15

PART II - OTHER INFORMATION

Item 1.	Legal Proceedings.	16

Item 6.	Exhibits.	17

PART III – REVIEW BY INDEPENDENT CERTIFIED PUBLIC ACCOUNTING FIRM		18

Signature		19

This amendment no. 1 to Quarterly Report on Form 10-Q for period ended June 30, 2013 is pursuant to that certain Current Report on Form 8-K Item 4.02 filed with the Securities and Exchange Commission on January __, 2014 pertaining to non-reliance on previously issued financial statements. On approximately January 18, 2014, the Board of Directors was advised by the Company's independent public accountant, Edward Richardson Jr. CPA that its financial statements reviewed and/or audited by Richard for the quarters referenced below as filed (collectively, the Financial Statements") with the Securities and Exchange Commission could not be relied upon based upon the inadvertent non-disclosure of two 8% convertible notes due May 17, 2015 in the principal amounts of $400,000 and $100,000, respectively, on the balance sheets as of the dates indicated (collectively, the "Convertible Notes"), and accrued interest payable under the Convertible Notes.

The Convertible Notes were previously issued in connection with certain subscription agreements entered into by the Company and the related share exchange agreement dated May 7, 2010 among the Company, TouchIt Technologies Koll Sti ("TouchIt Tech KS), the stock holders of TouchIt Tech KS, TouchIt Education Koll Sti ("TouchIt Ed"), and the stockholders of TouchIt Ed (the "Share Exchange Agreement"), pursuant to which the Company entered into various agreements with purchasers of the Convertible Notes.

Period Ended	Form	Date Filed with SEC

September 30, 2011	10-Q	November 14, 2011

December 31, 2011	10-K	April 5, 2012

March 31, 2012	10-Q	May 10, 2012

June 30, 2012	10-Q	August 2, 2012

September 30, 2012	10-Q	November 9, 2012

December 31, 2012	10-K	March 28, 2013

March 31, 2013	10-Q	May 15, 2013

June 30, 2013	10-Q	August 14, 2013

September 30, 2013	10-K	November 14, 2013

See "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operation. "

EXPLANATORY NOTE

TouchIT Technologies, Inc. (the “Company”) was incorporated in the State of Nevada as “Hotel Management Systems, Inc.” On May 7, 2010, the Company entered into a share exchange agreement, with TouchIT Technologies Koll Sti (“TouchIT Tech KS”), TouchIT Education Koll Sti (“TouchIT Ed”)(“TouchIT Ed” and together with TouchIT Tech KS, “TouchIT”), and the stockholders of TouchIT Tech KS and Touch Ed. Both TouchIT Tech KS and TouchIT Ed are corporations formed under the laws of Turkey and are based in Istanbul, Turkey. The closing of the transaction (the “Closing”) took place on May 7, 2010 (the “Closing Date”), all as disclosed on Form 8-K filed by the Company with the Securities and Exchange Commission on May 24, 2010. See “Recent Developments”. Subsequently, the Registrant amended its Articles of Incorporation to change its name to TouchIT Technologies, Inc., as disclosed on Form 8-K filed by the Registrant with the Securities and Exchange Commission on May 24, 2010.

Unless otherwise specified or required by context, as used in this Quarterly Report on Form 10-Q, the terms “we,” “our,” “us” and the “Company” refer collectively to (i) TouchIT Technologies, Inc., a Nevada corporation (“TouchIT”), (ii) TouchIT Tech KS and TouchIT Ed, both being wholly-owned subsidiaries of TouchIT. In this Quarterly Report on Form 10-Q, unless otherwise specified, all dollar amounts are expressed in United States dollars and all references to “common shares” refer to the shares of our common stock, $0.001 par value per share. All financial information presented is for the combined entity TouchIT, which comprises of TouchIT Tech KS and TouchIT Ed. They have not been consolidated and inter-company transactions, although not significant, do exist.

CAUTIONARY NOTE ON FORWARD LOOKING STATEMENTS

In addition to historical information, this Quarterly Report on Form 10-Q (this “Quarterly Report”) contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. The forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those reflected in such forward looking statements. Factors that might cause such a difference include, but are not limited to, those discussed in the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Readers are cautioned not to place undue reliance on these forward looking statements, which reflect management’s opinions only as of the date thereof.

In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “projects,” “potential,” “proposed,” “intended” or “continue” or the negative of these terms or other comparable terminology. You should read statements that contain these words carefully, because they discuss our expectations about our future operating results or our future financial condition or state other forward-looking information. Although we believe that the expectations reflected in the forward looking statements are reasonable, we cannot guarantee future results, growth rates, and levels of activity, performance or achievements. There may be events in the future that we are not able to accurately predict or control.

All forward-looking statements included in this Quarterly Report are based on information available to us on the date of this Quarterly Report. Except to the extent required by applicable laws or rules, we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. All subsequent written and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements contained throughout this Quarterly Report.

PART I - FINANCIAL INFORMATION

TOUCHIT TECHNOLOGIES, INC

BALANCE SHEETS

FOR THE PERIODS ENDED 30 JUNE 2013 & 2012 AND 31 DECEMBER 2012 & 2011

(Amounts expressed in US Dollars (USD) in full unless otherwise indicated)

CURRENT ASSETS	30/06/2013			31/12/2012			30/06/2012			31/12/2011

Cash and cash equivalents		9,722			6,413			15,584			70,289
Trade receivables, net		201,339			64,170			122,194			240,867
Due from related parties		-			-			-			-
Due from Shareholders		-			-			-			-
Inventories		68,829			111,461			32,419			55,689
Other current assets

Total current assets		279,890			182,043			170,196			366,845

NON CURRENT ASSETS

Property, plant and equipment,net		5,353			6,076			2,032			1,027
Other Assets		-									-
Other non current assets		400,000			400,000			400,000			-

Total non current assets		405,353			406,076			402,032			1,027

TOTAL ASSETS		685,243			588,119			572,228			367,872

CURRENT LIABILITIES
Borrowings		-			-			-			-
Trade payables		218,517			274,352			143,672			181,984
Due to shareholders		-			-			-			-
Due to related parties		189,499			261,499			324,499			265,318
Other current liabilities		153,808			11,310			47,260			27,390

Total current liabilities		561,824			547,161			525,431			474,692

NON CURRENT LIABILITIES
Borrowings		-			-			71,841			250,000
Employee termination benefits		-			-			-			-
Reserve for retirement pay		-			-			-			-
Convertible Notes		629,856			583,200			583,200			540,000

Total non current liabilities		629,856			583,200			655,041			790,000

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS' EQUITY
Share capital		507,428			544,303			544,303			127,570
Retained earnings		(1,047,613	)		(1,061,404	)		(1,103,654	)		(637,698	)
Net income / (loss) for the period		33,748			(25,141	)		(92,092	)		(386,692	)

Total shareholders’ equity		(506,437	)		(542,141	)		(608,244	)		(896,820	)

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY		685,243			588,119			572,228			367,872

TOUCHIT TECHNOLOGIES, INC

COMBINED STATEMENTS OF COMPREHENSIVE INCOME

FOR THE THREE AND SIX MONTH PERIODS ENDED 30 JUNE 2013 & 2012

(Amounts expressed in US Dollars (USD) in full unless otherwise indicated)

	3 Months Ended June 30 2013			3 Months Ended June 30 2012			6 Months Ended June 30 2013		6 Months Ended June 30 2012

NET SALES		423,578			285,803			800,189		505,685
COST OF SALES		283,423			202,746			550,489		353,002
Gross profit		140,155			93,057			249,700		152,683
MARKETING AND SELLING EXPENSE		8,383			3,675			14,717		37,458
GENERAL AND ADMINISTRATIVE EXPENSES		133,453			97,716			210,255		208,517
Profit from operations		(1,681	)		(8,335	)		24,727		(93,292	)
OTHER INCOME AND EXPENSES,net		--			1,200			9,021		1,200
FINANCIAL INCOME AND EXPENSES, net		--			--			--		--
Profit Loss before taxation and currency translation gain/(loss)		(1,681	)		(7,135	)		33,748		(92,092	)
TAXATION CHARGE		--			--			--		--
Taxation current		--			--			--		--
Deferred		--			--			--		--
CURRENCY TRANSLATION GAIN/(LOSS)		--			--			--		--
Net income/(loss) for the Period		(1,681	)		(7,135	)		33,748		(92,092	)
OTHER COMPREHENSIVE INCOME		--			--			--		--
Total comprehensive income		(1,681	)		(7,135	)		33,748		(92,092	)

TOUCHIT TECHNOLOGIES, INC

STATEMENT OF CASH FLOWS

FOR THE PERIODS ENDED 30 JUNE 2013 & 2012

(Amounts expressed in US Dollars (USD) in full unless otherwise indicated)

	6 Months Ended June 30 2013			6 Months Ended June 30 2012
CASH FLOWS FROM OPERATING ACTIVITIES
Net income		33,748			(92,092	)
Adjustments to reconcile net income to net cash provided		0			(436,865	)
By operating activities:
Depreciation and amortisation		723
Provision for employee benefit		--			--

Changes in operating assets and liabilities
Trade receivables, net		(137,169	)		118,674
Due from shareholders		--			--
Due from related parties		--			--
Inventories		42,632			23,270
Other current assets		--			--
Other non current assets		--			--
Trade payables		133,664			30,869
Due to shareholders		--			--
Due to related parties		--			--
Other current liabilities		142,498			19,870
Convertible Notes

Net cash generated from (used for) operating activities		218,152			(293,074	)

CASH FLOWS FROM FINANCING ACTIVITIES
Increase/(decrease) in short-term borrowings		(214,843	)		--
Increase/(decrease) in long-term borrowings					281,774
Dividends paid		--			--

Net cash (used for) provided from financing activities		(214,843	)		281,774

CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property, plant and equipment and intangible assets		--			(205	)
Share capital increase

Net cash used for investing activities		--			(205	)

NET INCREASE / (DECREASE) IN CASH AND BANKS		3,309			(54,705	)

CASH AND BANKS AT BEGINNING OF THE YEAR		6,413			70,289

CASH AND BANKS AT END OF THE PERIOD		9,722			15,584

TOUCHIT TECHNOLOGIES, INC.
STATEMENT OF CHANGES IN STOCKHOLDER'S EQUITY
FOR THE PERIOD ENDED JUNE 30, 2013 AND 2012

																				Total
																	Retained			Stockholder's
	Common Stock				Preferred Stock				Paid-in Capital				Treasury Stock				Earnings			Equity
	Shares		Amount		Shares		Amount		Shares		Amount		Shares		Amount		Amount			Amount

Balance at January 1, 2013		228,064,419	$	127,570	$	-	$	-		228,064,419	$	379,858		-	$	-	$	(1,011,234	)	$	(542,241	)

Net Income		-		-		-		-		-		-		-		-		33,748			33,748

Capital Transactions		-		-		-		-		-		-		-		-		-			-

Prior Period Adjustments		-		-		-		-		-		-		-		-		36,379			2,056

Balance at June 30, 2013		228,064,419	$	127,570	$	-	$	-		228,064,419		379,858		-	$	-	$	(1,013,865	)	$	(506,437	)

																				Total
																	Retained			Stockholder's
	Common Stock				Preferred Stock				Paid-in Capital				Treasury Stock				Earnings			Equity
	Shares		Amount		Shares		Amount		Shares		Amount		Shares		Amount		Amount			Amount

Balance at January 1, 2012		55,839,419	$	127,570	$	-	$	-		55,839,419	$	416,733		-	$	-	$	(1,109,348	)	$	(565,045	)

Net Income		-		-		-		-		-		-		-		-		(48,893	)		(48,893	)

Capital Transactions		18,350,000		-		-		-		18,350,000		-		-		-		(36,065	)		(36,065	)

Prior Period Adjustments		-		-		-		-		-		-		-		-		5,694			5,694

Balance at June 30, 2012		228,064,419	$	127,570	$	-	$	-		74,189,419	$	416,733		-	$	-	$	(1,142,547	)	$	(608,244	)

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our financial statements and the related notes appearing elsewhere in this Quarterly Report. This discussion and analysis may contain forward-looking statements based on assumptions about our future business. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors.

Forward-Looking Statements

This Quarterly Report contains forward-looking statements. The forward-looking statements are contained principally in, but not limited to, the sections entitled “Management’s Discussion and Analysis or Plan of Operation,” “Business” and those listed in our other Securities and Exchange Commission filings. Forward-looking statements provide our current expectations or forecasts of future events. Forward-looking statements include statements about our expectations, beliefs, plans, objectives, intentions, assumptions and other statements that are not historical facts. Words or phrases such as “anticipate,” “believe,” “continue,” “ongoing,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project” or similar words or phrases, or the negatives of those words or phrases, may identify forward-looking statements, but the absence of these words does not necessarily mean that a statement is not forward-looking.

Forward-looking statements are subject to known and unknown risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. Our actual results could differ materially from those anticipated in forward-looking statements for many reasons. Accordingly, you should not unduly rely on these forward-looking statements, which speak only as of the date of this Report.

Unless required by law, we undertake no obligation to publicly revise any forward-looking statement to reflect circumstances or events after the date of this Report or to reflect the occurrence of unanticipated events. You should, however, review the factors and risks we describe in the reports we will file from time to time with the SEC after the date of this Report.

Management cautions that these statements are qualified by their terms and/or important factors, many of which are outside of our control, and involve a number of risks, uncertainties and other factors that could cause actual results and events to differ materially from the statements made, including, but not limited to, the following:

● actual or anticipated fluctuations in our quarterly and annual operating results;

● actual or anticipated product constraints;

● decreased demand for our products resulting from changes in consumer preferences;

● product and services announcements by us or our competitors;

● loss of any of our key executives;

● regulatory announcements, proceedings or changes;

● announcements in the touch technology community;

● competitive product developments;

● intellectual property and legal developments;

● mergers or strategic alliances in the touch technology industry;

● any business combination we may propose or complete;

● any financing transactions we may propose or complete; or

● broader industry and market trends unrelated to its performance.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements.

Plan of Operation

The ability of our Company to achieve our business objectives is contingent upon our success in raising additional capital until adequate revenues are realized from operations.

We are a manufacturer (via 3rd party contract manufacture) of touch based visual communication products for education and corporate worldwide marketplaces. Our mission is to design and manufacture high quality technology products. We manufacture a large range of touch screen and touch board products to suite all types of application from pen input wireless tablets, to large enameled steel touch-sensitive interactive whiteboards and large interactive Liquid Crystal Displays (“LCD”). Our products stand out from our competition in terms of our design, functionality and price offering. Our customers seek our products as they provide them with a different point of entry to the market in terms of price, quality of design and margin. Currently, demand for our products is exceeding our ability to supply.

COMPANY OVERVIEW

We manufacture touch-based visual communication products for the education and corporate worldwide marketplaces. Our products stand out from our competition in terms of design, functionality and price offering. Our customers seek our products as they provide them a different point of entry to the market in terms of price, quality of design and margin.

Our keys to success are:

1. Establish and maintain working relationships and contractual agreements with distribution and Original Equipment Manufacturer (“OEM”) customers;

2. Increase our profit margin by lowering the import and raw material costs by bulk purchasing from vendors;

3. By increasing our purchasing power, we can increase our stock holding and lowering delivery times to customers thus enabling further sales growth; and

4. Effectively communicate with our current and potential customers, through targeted efforts, our position as a differentiated provider of the highest quality of margin laden touch-based communication products.

Recent Developments

On April 11, 2012, we borrowed Two Hundred Fifty Thousand Dollars ($250,000) (the “Advance”) from Bibby International Trade Finance (the “Lender”) pursuant to a revolving credit facility evidenced by a Master Purchase Agreement with an effective date of April 11, 2012 (the “MPA”).

The MPA evidences a revolving credit facility for the purchase of the Company’s accounts receivable up to the principal amount of $250,000, which subject to Lender approval, may be increased. The outstanding principal amount is due on April 11, 2013. This facility was renewed for a further year on April 11, 2013.

The Advance is secured by, among other things, (i) the MPA made by and between our Company and the Lender pursuant to which the Borrower has granted a security interest in all of the Borrower's assets to the Lender (the "Security Agreement"), (ii) a personal guaranty and validity guaranty executed by Andrew Brabin, Chief Executive Officer of our Company.

The MPA also includes customary representations and warranties and affirmative and negative covenants, including, among others, payment of certain customary fees and expenses, covenants relating to financial reporting, maintenance of property and insurance, incurrence of liens and/or other indebtedness. The MPA also contains customary provisions for events of default, remedies in circumstances of default, required notices, governing law and jurisdiction of governance.

We have now completed the development and the establishment of a production line in Taiwan for a new range of Interactive LED products. Supply of LCD panels has become challenging as panel manufacturers have sent many models end of life in favor of the LED equivalent. These products include Interactive LEDs, with and without an embedded PC in sizes from 32” to 80”. The unique feature for the range of LEDs is that they do not require a driver to be installed, nor do they require any form of calibration by the user. These are true plug and play devices. All of these products are full high definition and touch-based and include options of multiple input “multi-touch”. We have also launched the TouchIT LED Fusion which is three interactive products in one. An Interactive LED, and Interactive Easel and an Interactive Table. This is a revolutionary product as it takes us into new group collaboration markets. Management believes the LED range of product will give us an advantage in the marketplace as the competition try and catch up with their own development.

We have finished the development of a new range of four point touch models of LED. These models were launched at the beginning of the quarter. These models have some unique features especially concerning the Apple Macintosh Operating System (“MAC OS”). Traditionally, MAC OS only allows for third party touch screens to operate in single touch mode. However, we have developed a range of LED screens that allow for multi-touch gesture support in MAC OS. Management believes that this new feature will give the Company a unique sales point in the marketplace and will also appeal the growing number of MAC users World-Wide. These models are now sold in all our markets world-wide.

TouchIT has been awarded with the CTICK standard mark for its range of LED product in Australia. After several weeks of testing the standard can now be applied to its products. Furthermore, the product has also been approved for governmental use during the same testing procedure. Management believes that this will give the Company a competitive advantage in governmental tenders where the competition does not have such suitability certification.

We launched and sold into the Australian marketplace a range of IP65 (A standard for all weather, outdoor and sunlight readable products) LCD & LED panels. The Company is able to offer these models in both touch and non-touch formats. Management believes that our niche for this particular product line is the Company’s ability to do small custom design builds of the products for customers that other manufacturers may not entertain. This is a range of products that if successful in the Australian marketplace we will roll out world-wide. The Company has sold these into both private (Perth International Rugby Stadium) and government (Western Australian Government) entities in Australia and these were installed in Quarter 2 2013 through our distributor Ingram Micro. There is an increase in demand for this kind of product in Australia and Management believes we will look to expand this category later in the year.

We have sold units into the United States, Australia and the Middle East for the new LED product line. The company has received excellent feedback on these models and Management expects that by Quarter 4 2013, the LED range will be 75% of revenue. The LED range represents a higher ticket item which will impact revenues and also presents a greater margin opportunity which Management believes will have a positive impact on profits.

With our partner DEMCO, we participated in the American Library Association show in Chicago 27th June 2nd July. Management believes that we will continue to see continued revenues from Demco. Demco is currently waiting to take delivery of an order which is destined for the Madison, WI Public Library System.

Sales of TouchIT WIS continue to increase. TouchIT WIS TouchIT "WIS" (Wireless Interactive Screen, pronounced "WIZ") is a wireless presentation system. TouchIT "WIS" allows a group of students in a class or business professionals in a meeting room to take turns in presenting from their Windows or MAC computer or even a mobile device, which are connected wirelessly to the TouchIT LED Duo transmitting in full HD. The increase of Bring Your Own Device (BYOD) initiatives is proving that there is a strong market for this variant of the TouchIT LED product line.

With our partner Shiffler Inc, we participated in School Dude University in Myrtle Beach SC, USA. This mini-tradeshow event gave the Company some prestigious exposure amongst the attendees of the event, as corporate sponsorship is limited to a select few.

At the request of the Apple Division at Ingram Micro Australia, we participated in the Apple Mobility Roadshow. This was a series of events in Brisbane, Melbourne, and Sydney where we showcased our 4 point touch LED and the gesture support that it has under the MAC operating system. This was the first outing for this product and the feedback that we received from the specialist MAC resellers was encouraging. Management believes that this will lead to revenue being recognized in Q3 as a direct result of this event.

We participated in the ISTE Trade Show in San Antonio TX, USA in July. This is the Company’s main educational trade show event for the year. The Company’s exhibition booth was focused around the LED product range where we displayed 4 stations of LED along with the Fusion. We received over 100 leads from the show that Management believes will generate revenue for the company in Q3 2013.

The Company is finalizing a new Digital Signage product that it will launch in Q3 2013. This product will comprise of a standalone player and signage software. The Company has been receiving a number of requests for such a product. The product will be unique in that it will be able to cater for all types of digital signage, moreover touch and non-touch applications with the same piece of software. This is something that most of the competition do not cater for. The go to market strategy for this new product will be to target both the touch and non-touch applications. Therefore, this product will take us into a different vertical market of signage which Management believes will become a revenue stream for the Company by Q4 2013.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The accompanying financial statements include the financial statements of TouchIT Tech KS and TouchIT Ed. Although not significant, it should be noted that inter-company transactions and balances do exist and have not been consolidated. TouchIT Tech KS and TouchIT Ed together are also referred to as the “Company.”

This management's discussion and analysis of our financial condition and results of operations are based on the financial statements of both TouchIT Tech and TouchIT Ed, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements as well as the reported net sales and expenses during the reporting periods. On an ongoing basis, we will evaluate these estimates and assumptions. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

We believe that the following accounting policies are the most critical to aid you in fully understanding and evaluating this management discussion and analysis:

Basis of presentation financial statements:

Our Company maintains its books of account and prepares its statutory financial statements in accordance with accounting principles in the United States of America and tax legislation. The accompanying financial statements are based on the statutory records, with adjustments and reclassifications, for the purpose of fair presentation in accordance with United States generally accepted accounting principles (“US GAAP”).

There are inter-company transactions that have not been consolidated on these financial statements.

Revenue recognition:

Revenue is measured at the fair value of the consideration received or receivable. Revenue is reduced for customer returns, rebates, and other similar allowances.

Inventories:

Inventories are stated at the lower of cost or net realizable value. Costs, including an appropriate portion of fixed and variable overhead expenses, are assigned to inventories held by the method most appropriate to the particular class of inventory being valued on the weighted average basis. Net realizable value represents the estimated selling price less all estimated costs of completion and costs necessary to deliver service.

Property, plant and equipment:

Property, plant and equipment are carried at cost less accumulated depreciation and any accumulated impairment losses, if any. Depreciation is charged so as to write off the cost of assets, other than land and construction in progress, over their estimated useful lives, using straight line method. The estimated useful lives, residual values and depreciation method are reviewed at each year end, with the effect of any changes in estimate accounted for on a prospective basis.

Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or, where shorter, the term of the relevant lease. The gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in profit or loss.

The ranges of estimated useful lives are as follows:

-	Machinery and equipments: 2-6 years

-	Motor vehicles: 4 years

-	Furniture, fixtures and office equipments: 4-5 years

Shipping and handling:

Shipping and handling costs related to costs of the raw material purchased is included in cost of revenues.

Research and development costs:

Research and development costs are expensed as incurred. The costs of material and equipment that are acquired or constructed for research and development activities, and have alternative future uses, either in research and development, marketing, or sales, are classified as property and equipment or depreciated over their estimated useful lives.

Company reporting year end:

We use a calendar year as our fiscal year ending December 31.

RESULTS OF OPERATIONS

TOUCHIT TECHNOLOGIES, INC STATEMENTS OF COMPREHENSIVE INCOME

FOR QUARTER ENDED JUNE 30, 2013 & 2012

(Amounts expressed in US Dollars (USD) in full unless otherwise indicated)

	36/06/2013		30/06/2012

NET SALES		800,189		505,685
COST OF SALES		550,489		353,002
Gross profit		249,700		152,683
MARKETING AND SELLING EXPENSE		14,717		37,458
GENERAL AND ADMINISTRATIVE EXPENSES		210,255		208,517
Profit from operations		24,727		(93,292	)
OTHER INCOME AND EXPENSES,net		9,021		1,200
FINANCIAL INCOME AND EXPENSES, net		--		--
Profit Loss before taxation and currency translation gain/(loss)		33,748		(92,092	)
TAXATION CHARGE		--		--
Taxation current		--		--
Deferred		--		--
CURRENCY TRANSLATION GAIN/(LOSS)		--		--
Net income/(loss) for the year		33,748		(92,092	)
OTHER COMPREHENSIVE INCOME		--		--
Total comprehensive income		33,748		(92,092	)

NET SALES (REVENUE) – For the first six months of the year, quarter ended June 30, 2013, as compared to the six months ended June 30, 2012, revenue has increased by 58% or by $294,504 from $505,685 to $800,189. This increase can be attributed to a change in strategy by Management. Our going forward sales activity reflects our management’s plan of increasing focus on the development of recurring business in existing and new markets for the new Interactive LED Line. Our management does anticipate that revenues will continue to grow for the balance of the year due to the LED product line which represents a much larger value ticket item which will drive revenues higher and the current back order that the Company has built up.

GROSS PROFIT – For the first six months of the year, quarter ended June 30, 2013, as compared to the six months ended June 30, 2012, gross profit has increased by $97,017 from $152,683 to 249,700. This is primarily due to the restructuring of the business over the last year and the focus on the more profitable LED product line. Our management does anticipate gross profits to continue to rise for the balance of the year.

OPERATIONAL PROFIT – For the first six months of the year, quarter ended June 30, 2013, as compared to the six months ended June 30, 2012, operational profit has increased from a net loss of $(93,292) to a net profit of $24,727, an increase of $68,565. This can be attributed to the Management’s focus on reducing overhead costs to maximize profitability when revenues increase.

	30/06/2013			30/06/2012

MARKETING AND SELLING EXPENSE	$	14,717		$	37,458
As a percentage of revenue		2	%		7	%
GENERAL AND ADMINISTRATIVE EXPENSES	$	210,255		$	208,517
As a percentage of revenue		26	%		41	%

NET INCOME FOR THE PERIOD – For the first six months of the year, quarter ended June 30, 2013, as compared to the six months ended June 30, 2012, NET income for the period has increased by $58,344 from a net loss of $(92,092) to a net profit of $33,748. This can be attributed to the Management’s focus on reducing overhead costs to maximize profitability when revenues increase.

TOUCHIT TECHNOLOGIES, INC BALANCE SHEET AT JUNE 30, 2013 & 2012

(Amounts expressed in US Dollars (USD) in full unless otherwise indicated)

CURRENT ASSETS	30/06/2013			30/06/2012

Cash and cash equivalents		9,722			15,584
Trade receivables, net		201,339			122,194
Due from related parties		-			-
Due from Shareholders		-			-
Inventories		68,829			32,419
Other current assets

Total current assets		279,890			170,196

NON CURRENT ASSETS

Property, plant and equipment,net		5,353			2,032
Other Assets		-
Other non current assets		400,000			400,000

Total non current assets		405,353			402,032

TOTAL ASSETS		685,243			572,228

CURRENT LIABILITIES
Borrowings		-			-
Trade payables		218,517			143,672
Due to shareholders		-			-
Due to related parties		189,499			324,499
Other current liabilities		153,808			47,260

Total current liabilities		561,824			525,431

NON CURRENT LIABILITIES
Borrowings		-			71,841
Employee termination benefits		-			-
Reserve for retirement pay		-			-
Convertible Notes		629,856			583,200

Total non current liabilities		629,856			655,041

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS' EQUITY
Share capital		507,428			544,303
Retained earnings		(1,047,613	)		(1,103,654	)
Net income / (loss) for the period		33,748			(48,893	)

Total shareholders’ equity		(506,437	)		(608,244	)

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY		685,243			572,228

CURRENT ASSETS – For the first six months of the year, quarter ended June 30, 2013, as compared to the six months ended June 30, 2012, total current assets have increased by $109,694 or 64%. This increase is primarily due to an increase in Trade Receivables which have increased by 65% when compared to the same period in 2012.

NON-CURRENT ASSETS – For the first six months of the year, quarter ended June 30, 2013, as compared to the six months ended June 30, 2012, total non-current assets have increased by $3,321 or 1%. This is mainly due to a small increase in fixed assets on the Company’s balance sheet.

TOTAL ASSETS – For the first six months of the year, quarter ended June 30, 2013, as compared to the six months ended June 30, 2012, total assets have increased by $113,015 or 20% from $572,228 to $685,243. The reason for the increase in assets is primarily due to an increase in Trade Receivables which have increased by 65% when compared to the same period in 2012.

CURRENT LIABILITIES – For the first six months of the year, quarter ended June 30, 2013, as compared to the six months ended June 30, 2012, total current liabilities have increased by $36,393 from $525,431 to $561,824, a 7% increase. Trade payables have increased by 52% or $74,845, which can be attributed to the trade credit that is being offered to the Company from the LED supplier.

NON-CURRENT LIABILITIES - For the first six months of the year, quarter ended June 30, 2013, as compared to the six months ended June 30, 2012 they have decreased by $25,185 from $655,041 to $629,856. This can be attributed to a reduction in Company borrowings.

Convertible Notes

Two 8% convertible notes due May 17, 2015 in the principal amounts of $400,000 and $100,000, respectively, on the balance sheets as of the dates indicated (collectively, the "Convertible Notes"), and accrued interest payable under the Convertible Notes. The Convertible Notes were issued in connection with certain subscription agreements entered into by the Company and the related share exchange agreement dated May 7, 2010 among the Company, TouchIt Tech KS, the stock holders of TouchIt Tech KS, TouchIt Ed, and the stockholders of TouchIt Ed (the "Share Exchange Agreement"), pursuant to which we entered into various agreements with purchasers of the Convertible Notes.

As of June 30, 2013, we owed approximately $500,000 in aggregate principal amount and $129,856 in accrued interest.

TOUCHIT TECHNOLOGIES, INC STATEMENT OF CASH FLOW FOR QUARTERS ENDED

JUNE 30, 2013 & 2012

(Amounts expressed in US Dollars (USD) in full unless otherwise indicated)

	30/06/2013			30/06/2012
CASH FLOWS FROM OPERATING ACTIVITIES
Net income		33,748			(92,092	)
Adjustments to reconcile net income to net cash provided		2,056			(436,865	)
By operating activities:
Depreciation and amortisation		723
Provision for employee benefit		--			--

Changes in operating assets and liabilities
Trade receivables, net		(137,169	)		118,674
Due from shareholders		--			--
Due from related parties		--			--
Inventories		42,632			23,270
Other current assets		--			--
Other non current assets		--			--
Trade payables		133,664			30,869
Due to shareholders		--			--
Due to related parties		--			--
Other current liabilities		142,498			19,870
Convertible Notes

Net cash generated from (used for) operating activities		(218,152	)		(293,074	)

CASH FLOWS FROM FINANCING ACTIVITIES
Increase/(decrease) in short-term borrowings		(214,843	)		--
Increase/(decrease) in long-term borrowings					281,774
Dividends paid		--			--

Net cash (used for) provided from financing activities		(214,843	)		238,574

CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property, plant and equipment and intangible assets		--			(205	)
Share capital increase

Net cash used for investing activities		--			(205	)

NET INCREASE / (DECREASE) IN CASH AND BANKS		3,309			(54,705	)

CASH AND BANKS AT BEGINNING OF THE YEAR		6,413			70,289

CASH AND BANKS AT END OF THE PERIOD		9,722			15,584

NET INCOME FOR THE PERIOD – For the first six months of the year, quarter ended June 30, 2013, as compared to the six months ended June 30, 2012, NET income for the period has increased by $37,205 from a net loss of $(92,092) to a net profit of $33,748. This can be attributed to the Management’s focus on reducing overhead costs to maximize profitability when revenues increase.

NET CASH GENERATED FOR OPERATING ACTIVITIES – For the first six months of the year, quarter ended June 30, 2013, as compared to the six months ended June 30, 2012, NET cash generated for operating activities was $264,808 compared to $(293,074) which is an increase of $557,882. This can be attributed primarily in the increase of credit from Trade Payables and Other Liabilities.

Cash flow in general has improved as we make use of the Credit Facility from our Lender. Our management expects to utilize the facility to its full extent as our business grows.

CASH FLOW FROM FINANCING ACTIVITES – For the first six months of the year, quarter ended June 30, 2013, as compared to the six months ended June 30, 2012, cash flow used by financing activities was $(214,843) compared to cash flow from financing activities of $238,574 at June 30, 2012. This was due to the restructuring of our credit lines and the switch from TCA’s structure to that of our current Lender BITF.

CASH POSITION. There was a NET decrease in the cash and cash equivalents of $5862 from the beginning of the period through June 30, 2013. This change in cash position can be attributed to being normal in course of regular business We generally pay our suppliers on 30 day terms and as a business, remain to be cash poor with low cash reserves.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

We are a “smaller reporting company” (as defined by Rule 12b-2 of the Exchange Act) and are not required to provide the information required under this item.

Item 4. Controls and Procedures.

(a) Disclosure Controls and Procedures

Regulations under the Securities Exchange Act of 1934 require public companies to maintain “disclosure controls and procedures,” which are defined to mean a company’s controls and other procedures that are designed to ensure that information required to be disclosed in the reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms.

We carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the period covered by this Report. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that as of June 30, 2013, our disclosure controls and procedures were effective at the reasonable assurance level, but we did identify the material weaknesses described below.

A material weakness is a control deficiency (within the meaning of the Public Company Accounting Oversight Board (PCAOB) Auditing Standard No. 2) or combination of control deficiencies that result in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected. Management has identified the following six material weaknesses in our disclosure controls and procedures:

1. We do not have written documentation of our internal control policies and procedures. Written documentation of key internal controls over financial reporting is a requirement of Section 404 of the Sarbanes-Oxley Act. Management evaluated the impact of our failure to have written documentation of our internal controls and procedures on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness.

2. We do not have sufficient segregation of duties within accounting functions, which is a basic internal control. Due to our size and nature, segregation of all conflicting duties may not always be possible and may not be economically feasible. However, to the extent possible, the initiation of transactions, the custody of assets and the recording of transactions should be performed by separate individuals. Management evaluated the impact of our failure to have segregation of duties on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness.

3. We do not have review and supervision procedures for financial reporting functions. The review and supervision function of internal control relates to the accuracy of financial information reported. The failure to review and supervise could allow the reporting of inaccurate or incomplete financial information. Due to our size and nature, review and supervision may not always be possible or economically feasible. Management evaluated the impact of our significant number of audit adjustments and has concluded that the control deficiency that resulted represented a material weakness.

To address these material weaknesses, management performed additional analyses and other procedures to ensure that the financial statements included herein fairly present, in all material respects, our financial position, results of operations and cash flows for the periods presented.

(b) Changes in internal control over financial reporting

During the six months ended June 30, 2013, our Company has not made any changes to internal control over financial reporting.

PART II - OTHER INFORMATION

On August 5th 2013, pursuant to the Advance from Bibby International Trade Finance, the Lender, the Lender agreed to increase the MPA from $250,000 to $500,000. All other terms of the MPA remained unchanged. Management requested this increase in order to capitalize on sales that will be recognized in Quarter 3 2013.

Item 1. Legal Proceedings.

We are currently not aware of any such legal proceedings or claims that will have, individually or in the aggregate, a material adverse affect on its business, financial condition or operating results.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

On May 7, 2010, we entered into a Share Exchange Agreement with TouchIT Tech KS, the stockholders of TouchIT Tech KS, TouchIT, and the stockholders of Touch Ed, pursuant to which we issued 48,330,000 shares of our Common Stock to the shareholders of TouchIT Tech KS and TouchIT Ed in exchange for all shares held by these shareholders in TouchIT Tech KS and TouchIT Ed. The issuance of these shares was exempted from registration pursuant to Section 4(2) of the Securities Act of 1933. The terms of the Share Exchange Agreement are discussed more fully in Item 1.01 and 2.01 on Form 8-K, filed with the SEC on May 12, 2010.

In connection with the closing of the Share Exchange Agreement, on May 7, 2010, we entered into a Subscription Agreement with certain investors for the sale of up to $1,500,000 of principal amount convertible promissory notes of the Company convertible into up to 6,000,000 shares of our Common Stock and share purchase warrants to purchase up to 6,000,000 shares of our Common Stock. The terms of the Subscription Agreement, Notes and Warrants (including the terms of conversion and/or exercise of the Notes and Warrants) are discussed more fully in Item 1.01 and 2.01 on Form 8-K, filed with the SEC on May 12, 2010. The issuance of these securities was exempted from registration pursuant to Section 4(2) of the Securities Act of 1933.

On April 10th 2013 The Company entered into an agreement with Ronald George Murphy to convert debt for services as an Officer and President of World Wide Sales for the period April 1, 2012 to March 31, 2013 in exchange for the Company’s restricted Common Stock in the aggregate of 45,000,000 shares for an accrued amount of $10,000. The company owed him a balance of $108,413 at June 30, 2013

On April 10th 2013 The Company entered into an agreement with Andrew Stuart Brabin to convert debt for services as Chief Executive Officer for the period April 1, 2012 to March 31, 2013 in exchange for the Company’s restricted Common Stock in the aggregate of 45,000,000 shares for an accrued amount of $10,000. The company owed him a balance of $81,086 at June 30, 2013

Item 6. Exhibits

(a) Exhibits

Exhibit Number		Description of Exhibit

31.1		Certification of Principal Executive Officer pursuant to Rule 13a-14 and Rule 15d-14(a), promulgated under the Securities and Exchange Act of 1934, as amended.

31.2		Certification of Principal Financial Officer pursuant to Rule 13a-14 and Rule 15d 14(a), promulgated under the Securities and Exchange Act of 1934, as amended.

32.1		Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Principal Executive Officer).

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PART III – REVIEW BY INDEPENDENT CERTIFIED PUBLIC ACCOUNTING FIRM

Edward Richardson Jr., CPA

15565 Northland Suite 508 West

Southfield, MI. 48075

To the Board of Directors

TouchIT Technologies, Inc.

101 West Beaver Road

Suite 1400, Troy, MI. 48084

I have reviewed the accompanying balance sheet of TouchIT Technologies, Inc. as of June 30, 2013 and 2012, and the related statements of income and retained earnings and cash flows for the period then ended, and the accompanying supplementary information, which is presented only for supplementary analysis purposes, in accordance with the standards of the Public Company Accounting Oversight Board (United States). All information included is the representation of the Board of Directors of TouchIT Technologies.

A review consists principally of inquiries of company personnel and analytical procedures applied to financial data. It is substantially less in scope than an examination in accordance with US Generally Accepted Accounting Principles (“US GAAP”) standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, I do not express such an opinion.

Based on my review, I am not aware of any material modifications that should be made to the accompanying financial statements in order for them to be in conformity with US GAAP standards.

My review was made for the purpose of expressing limited assurance that there are no material modifications that should be made to the financial statements in order for them to be in conformity with US GAAP. The information in the accompanying statements and schedules is presented only for supplementary analysis purposes. Such information has been subject to the inquiry and analytical procedures applied in the review of the basic financial statements, and I am not aware of any material medications that should be made thereto.

/S/ Edward Richardson Jr., CPA

August 12, 2013

SIGNATURES

Pursuant to the requirements 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.

	TouchIT Technologies, Inc.

	By:	/s/ Andrew Brabin
		Andrew Brabin Chief Executive Officer Dated: January 27, 2014

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