U

10QSB/A 1 freedom305qsba2.htm AMENDED MARCH 31, 2005 10-QSB/A2 U

U.S. SECURITIES AND EX CHANGE COMMISSION

Washington, D.C. 20549

FORM 10-QSB/A 2

[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2005

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

For the transition period from to

Commission File No. 000-32735

FREEDOM RESOURCES ENTERPRISES, INC.

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

Nevada

(State or other jurisdiction of incorporation

or organization)

87-0567033

(IRS Employer Identification No.)

901 East 7800 South, Midvale, UT 84047

(Address of principal executive offices)

801-566-5931

(Issuer’s telephone number)

Not Applicable

(Former name and address)

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

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13, or 15(d) of the Exchange Act subsequent to the distribution of securities under a plan confirmed by a court. Yes [ ] No [ ]

APPLICABLE ONLY TO CORPORATE ISSUERS:

State the number of shares outstanding of each of the issuer’s classes of common equity, as of March 31, 2005: 4,750,000 shares of common stock, par value $0.001.

Transitional Small Business Format: Yes [ ] No [ X ]

FREEDOM RESOURCES ENTERPRISES, INC.

FORM 10-QSB

MARCH 31, 2005

INDEX


		Page
PART I.	Financial Information	3
	Item 1. Unaudited Condensed Financial Statements Unaudited Condensed Balance Sheets – March 31, 2005 and December 31, 2004 Unaudited Condensed Statements of Operations for the three months ended March 31, 2005 and 2004, and from inception on November 6, 1996 through March 31, 2005 Unaudited Condensed Statements of Cash Flows for the three months ended March 31, 2005 and 2004, and from inception on November 6, 1996 through March 31, 2005 Notes to Unaudited Condensed Financial Statements Item 2. Management’s Discussion and Analysis of Financial Condition or Plan of Operation Item 3. Controls and procedures	4 6 7 8 9-15 16 18
PART II.	Other Information Item 6. Exhibits and Reports on Form 8-K	18
	Signatures	19

(Inapplicable items have been omitted)

PART I.

Financial Information

Item 1. Unaudited Condensed Financial Statements

In the opinion of management, the accompanying unaudited condensed financial statements included in this Form 10-QSB/A reflect all adjustments (consisting only of normal recurring accruals) necessary for a fair presentation of the results of operations for the periods presented. The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year.

FREEDOM RESOURCES ENTERPRISES, INC.

[A Development Stage Company]

UNAUDITED CONDENSED FINANCIAL STATEMENTS

MARCH 31, 2005

FREEDOM RESOURCES ENTERPRISES, INC.

[A Development Stage Company]

CONTENTS

PAGE

—

Unaudited Condensed Balance Sheets,

March 31, 2005 and December 31, 2004

—

Unaudited Condensed Statements of Operations,

for the three months ended March 31, 2005

and 2004 and from inception on November 6,

1996 through March 31, 2005

—

Unaudited Condensed Statements of Cash Flows,

for the three months ended March 31, 2005

and 2004 and from inception on November 6,

1996 through March 31, 2005

—

Notes to Unaudited Condensed Financial Statements

9 - 15

FREEDOM RESOURCES ENTERPRISES, INC.

[A Development Stage Company]

UNAUDITED CONDENSED BALANCE SHEETS

ASSETS

March 31,

December 31,

2005

2004

^___________

CURRENT ASSETS:

Cash

225

247

^___________

Total Current Assets

225

247

PROPERTY AND EQUIPMENT, net

OTHER ASSETS:

Manuscripts and transcripts, net

^___________

225

247

^___________

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES:

Accounts payable

43,254

48,688

Accounts payable – related party

420

Advances from a shareholder

1,370

120

Accrued taxes

873

868

Accrued interest – related party

^___________

Total Current Liabilities

45,965

50,096

^___________

CONVERTIBLE NOTE PAYABLE – RELATED PARTY

5,000

___________

Total Liabilities

50,965

50,096

___________

STOCKHOLDERS' EQUITY (DEFICIT):

Preferred stock, $.001 par value,

5,000,000 shares authorized,

no shares issued and outstanding

Common stock, $.001 par value,

50,000,000 shares authorized,

4,750,000 shares issued and outstanding

4,750

Capital in excess of par value

47,918

Deficit accumulated during the

development stage

(103,408)

(102,517)

^___________

Total Stockholders' Equity (Deficit)

(50,740)

(49,849)

^___________

225

247

^___________

Note: The balance sheet at December 31, 2004 was taken from the audited financial statements at that date and condensed.

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

FREEDOM RESOURCES ENTERPRISES, INC.

[A Development Stage Company]

UNAUDITED CONDENSED STATEMENTS OF OPERATIONS

For the Three

From Inception

Months Ended

on November 6,

March 31,

1996 Through

^{_____________________}

March 31,

2005

2004

2005

^__________

^____________

REVENUE

400

2,060

^__________

^____________

EXPENSES:

Depreciation and amortization

4,174

General and administrative

4,940

1,442

69,211

Research and development

15,674

Impairment of long-lived assets

21,285

^__________

^____________

Total Expenses

4,940

1,528

110,344

^__________

^____________

LOSS BEFORE OTHER INCOME (EXPENSE)

(4,940)

(1,128)

(108,284)

OTHER INCOME (EXPENSE):

Interest income

1,216

Interest expense – related party

(48)

(216)

Gain on settlement of debt

4,097

^__________

^____________

Total Other Income (Expense)

4,049

5,097

LOSS BEFORE INCOME

TAXES

(891)

(1,128)

(103,187)

CURRENT TAX EXPENSE

DEFERRED TAX EXPENSE

^__________

^____________

LOSS FROM CONTINUING

OPERATIONS

(891)

(1,128)

(103,187)

CUMULATIVE EFFECT OF CHANGE

IN ACCOUNTING PRINCIPLE

(221)

^__________

^____________

NET LOSS

(891)

(1,128)

(103,408)

^__________

LOSS PER COMMON SHARE:

Continuing operations

(.00)

(.03)

Change in accounting

principle

(.00)

^__________

^____________

Loss per common

(.00)

(.03)

^__________

^____________

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

FREEDOM RESOURCES ENTERPRISES, INC.

[A Development Stage Company]

UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS

For the Three

From Inception

Months Ended

on November 6,

March 31,

1996 Through

^{______________________}

March 31,

2005

2004

2005

Cash Flows from Operating Activities: ___________ __________ _____________

Net loss

(891)

(1,128)

(103,408)

Adjustments to reconcile net loss to net cash provided

(used) by operating activities:

Amortization expense

2,432

Depreciation expense

1,742

Loss on impairment of long-lived assets

21,285

Effect of change in accounting principle

221

Gain on settlement of debt

(4,097)

Changes in assets and liabilities:

Increase (decrease) in accounts payable

(1,337)

1,438

47,351

Increase in accounts payable – related party

420

Increase in accrued taxes

873

Increase in accrued interest – related party

216

^__________

^{_____________}

Net Cash Provided (Used) by Operating Activities

(6,272)

480

(32,965)

^__________

^{_____________}

Cash Flows from Investing Activities:

Purchase of property and equipment

(1,742)

Organization costs

(288)

Cost of manuscripts

(23,650)

^__________

^{_____________}

Net Cash (Used) by Investing Activities

(25,680)

^__________

^{_____________}

Cash Flows from Financing Activities:

Proceeds from sale of common stock

52,500

Stock offering costs

(5,000)

Proceeds from issuance of notes payable

5,000

10,000

Advances from a shareholder

1,250

1,370

^__________

^{_____________}

Net Cash Provided by Financing Activities

6,250

58,870

^__________

^{_____________}

Net Increase (Decrease) in Cash

(22)

480

225

Cash at Beginning of Period

247

^__________

^{_____________}

Cash at End of Period

225

552

225

^___________

^{______________}

Supplemental Disclosures of Cash Flow Information:

Cash paid during the period for:

Interest

Income taxes

Supplemental Schedule of Noncash Investing and Financing Activities:

For the three months ended March 31, 2005:

In February 2005, the Company settled accounts payable of $9,097 for $5,000 cash and recognized $4,097 gain on settlement of debt.

For the three months ended March 31, 2004:

None

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

FREEDOM RESOURCES ENTERPRISES, INC.

[A Development Stage Company]

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization - Freedom Resources Enterprises, Inc. (“the Company”) was organized under the laws of the State of Nevada on November 6, 1996. The Company has not generated significant revenues from its planned principal operations and is considered a development stage company as defined in Statement of Financial Accounting Standards No. 7. The Company originally planned to research and publish a self-improvement book based on the insights and understanding of major world cultures. However, the Company never published the book but instead has used the materials gathered during its research to develop a series of eight self-help workshops. Each self-taught workshop consists of an audio tape and a workbook. The Company intends to market these workshops over the Internet. The Company has, at the present time, not paid any dividends and any dividends that may be paid in the future will depend upon the financial requirements of the Company and other relevant factors.

Condensed Financial Statements - The accompanying financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations and cash flows at March 31, 2005 and 2004 and for the periods then ended have been made.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America have been condensed or omitted. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s December 31, 2004 audited financial statements. The results of operations for the periods ended March 31, 2005 and 2004 are not necessarily indicative of the operating results for the full year.

Cash and Cash Equivalents - The Company considers all highly liquid debt investments purchased with a maturity of three months or less to be cash equivalents.

Property and Equipment - Property and equipment are stated at cost. Expenditures for major renewals and betterments that extend the useful lives of property and equipment are capitalized upon being placed in service. Expenditures for maintenance and repairs are charged to expense as incurred. Depreciation is computed for financial statement purpose on a straight-line method over the estimated useful life of five years.

Long-Lived Assets - The Company has adopted Statement of Financial Accounting Standards No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets”. The Company periodically reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. During the year ended December 31, 2000, the Company recorded an impairment write-down of $21,285 of manuscript costs.

Income Taxes - The Company accounts for income taxes in accordance with Statement of Financial Accounting Standards No. 109, “Accounting for Income Taxes”. [See Note 9].

FREEDOM RESOURCES ENTERPRISES, INC.

[A Development Stage Company]

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Revenue Recognition - The Company’s revenue has come from the sale of items where the Company acted only as an agent. The Company recognizes revenue when the product is delivered. The Company records revenues generated by the sale of items that the Company produces or purchases as inventory on the gross basis. On a gross basis, the entire sale amount is recorded as revenue. The Company records revenue generated by the sale of items where the Company only acts as an agent or when the Company has no risk of loss on the net basis. The Company records revenue generated by Internet sales utilizing third party websites on the net basis. On a net basis, only the share of revenue belonging to the Company is recorded as revenue.

Stock-Based Compensation - The Company has one stock-based employee compensation plan [See Note 5]. The Company accounts for its plan under the recognition and measurement principles of Accounting Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees” and related Interpretations. The Company has not issued any stock options or warrants under the plan.

Loss Per Share - The computation of loss per share is based on the weighted average number of shares outstanding during the period presented in accordance with Statement of Financial Accounting Standards No. 128, “Earnings Per Share” [See Note 10].

Accounting Estimates - The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reported period. Actual results could differ from those estimated.

Recently Enacted Accounting Standards - Statement of Financial Accounting Standards (“SFAS”) No. 151, “Inventory Costs – an amendment of ARB No. 43, Chapter4”, SFAS No. 152, “Accounting for Real Estate Time-Sharing Transactions – an amendment of FASB Statements No. 66 and 67”, SFAS No. 153, “Exchanges of Nonmonetary Assets – an amendment of APB Opinion No. 29”, and SFAS No. 123 (revised 2004), “Share-Based Payment”, were recently issued. SFAS No. 151, 152, 153, and 123 (revised 2004) have no current applicability to the Company or their effect on the financial statements would not have been significant.

Reclassification - The financial statements for periods prior to March 31, 2005 have been reclassified to conform to the headings and classifications used in the March 31, 2005 financial statements.

Restatement - In February 2005, the Company approved a 10 – for – 1 forward stock split [See Note 5]. The financial statements have been restated, for all periods presented, to reflect the stock split.

FREEDOM RESOURCES ENTERPRISES, INC.

[A Development Stage Company]

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

NOTE 2 - PROPERTY AND EQUIPMENT

Property and equipment consisted of the following at:

March 31,

December 31,

2005

2004

^___________

Office equipment

1,742

Less: Accumulated depreciation

(1,742)

^___________

Depreciation expense for the three months ended March 31, 2005 and 2004 was $0 and $86, respectively.

NOTE 3 - MANUSCRIPTS, TRANSCRIPTS, ETC.

In 1999 and 2000, the Company paid consultants to prepare manuscripts which the Company had planned to publish as a book. In December 2000, in accordance with Statement of Financial Accounting Standards No. 121, the Company recorded an impairment write-down of $21,285 due to the Company not generating any revenues from the manuscripts. A summary of manuscripts, transcripts, etc. consists of the following at:

March 31,

December 31,

2005

2004

^___________

Manuscripts, transcripts, etc.

23,650

Less: Accumulated amortization

(2,365)

Less: Loss on impairment

(21,285)

^___________

Amortization expense for the three months ended March 31, 2005 and 2004 was $0 and $0, respectively.

NOTE 4 – CONVERTIBLE NOTES PAYABLE – RELATED PARTY

In April 2004, the Company issued a $5,000 note payable to a shareholder of the Company. The note accrued interest at 8% per annum, was due April 2006, and was convertible with accrued interest into 1,000,000 shares of common stock. In September 2004, the shareholder exercised his conversion right and the Company issued 1,000,000 shares of common stock.

In February 2005, the Company issued a $5,000 note payable to a shareholder of the Company. The note accrues interest at 8% per annum, is due in February 2007, and is convertible with accrued interest into 1,000,000 shares of common stock. At March 31, 2005, accrued interest amounted to $48.

FREEDOM RESOURCES ENTERPRISES, INC.

[A Development Stage Company]

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

NOTE 5 - CAPITAL STOCK

Preferred Stock - The Company has authorized 5,000,000 shares of preferred stock, $.001 par value with such rights, preferences and designations and to be issued in such series as determined by the Board of Directors. No shares are issued and outstanding at March 31, 2005 and December 31, 2004.

Common Stock - In November 1996, in connection with its organization, the Company issued 2,500,000 shares of its previously authorized but unissued common stock. Total proceeds from the sale of stock amounted to $2,500 (or $.001 per share).

In August 1997, the Company issued 237,500 shares of its previously authorized but unissued common stock. Total proceeds from the sale of stock amounted to $9,500 (or $.04 per share).

In May and August 1998, the Company issued 1,012,500 shares of its previously authorized but unissued common stock. Total proceeds from the sale of stock amounted to $40,500 (or $.04 per share). Stock offering costs of $5,000 were offset against the proceeds.

In September 2004, the Company issued 1,000,000 shares of its previously authorized but unissued common stock on conversion of a note payable of $5,000 with accrued interest of $168.

In February 2005, the Company approved a 10 – for – 1 forward stock split. The financial statements have been restated, for all periods presented, to reflect the stock split.

Stock Option Plan - In 1997, the Board of Directors adopted the 1997 Stock Option Plan (“the Plan”). Under the terms and conditions of the Plan, the Board is empowered to grant stock options to employees, officers, directors and consultants of the Company. Additionally, the Board will determine, at the time of the grant, vesting provisions of the grant and whether the options will qualify as incentive stock options under section 422 of the Internal Revenue code. The Plan was approved by the shareholders of the Company at its 1997 shareholder meeting. The total number of shares of common stock available under the Plan may not exceed 750,000 shares. As of March 31, 2005, no options have been issued under the Plan.

FREEDOM RESOURCES ENTERPRISES, INC.

[A Development Stage Company]

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

NOTE 6 - RELATED PARTY TRANSACTIONS

Accounts Payable - In 2004, the Company sold products owned by LDI [See Note 8]. At March 31, 2005 and December 31, 2004, the Company owed $420 to LDI for the cost of the products.

Convertible Notes Payable – The Company has issued convertible notes payable to a shareholder of the Company [See Note 4].

Advances from a Shareholder – In February and March 2005, an officer/shareholder of the Company advanced $1,250 to the Company. At March 31, 2005 and December 31, 2004, the Company owed $1,370 and $120, respectively, to the officer/shareholder. The advances bear no interest and are due on demand.

Management Compensation - The Company has not paid any compensation to its officers and directors.

Office Space - The Company has not had a need to rent office space. An officer/shareholder of the Company is allowing the Company to use his office as a mailing address, as needed, at no expense to the Company.

Marketing Agreement - The Company has a marketing agreement with Life Discovery Institute, an organization that is owned and operated by the Company’s president [See Note 8].

NOTE 7 - GOING CONCERN

The accompanying financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America, which contemplate continuation of the Company as a going concern. However, the Company has incurred losses since its inception and has current liabilities in excess of current assets. These factors raise substantial doubt about the ability of the Company to continue as a going concern. In this regard, management is proposing to raise any necessary additional funds not provided by operations through loans or through additional sales of its common stock. There is no assurance that the Company will be successful in raising this additional capital or in achieving profitable operations. The financial statements do not include any adjustments that might result from the outcome of these uncertainties.

FREEDOM RESOURCES ENTERPRISES, INC.

[A Development Stage Company]

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

NOTE 8 - MARKETING AGREEMENT

In 1999 and 2000, the Company invested in developing a website to market its products via the Internet. Ultimately, the Company did not launch its website. Instead, the Company assigned its interest in the website to Life Discovery Institute (“LDI”), an education and publishing organization owned and operated by the Company’s President. On May 31, 2001, the Company entered into a five-year marketing agreement with LDI. Under the agreement, the Company assigned all its interest and investment in developing the website to LDI which completed development and launched the website. In exchange for the Company’s prior investment in the website, LDI allows the Company to market its products at no charge through the LDI website. This agreement will end on May 31, 2006. The Company currently has no other sources of distribution for its workshops.

NOTE 9 - INCOME TAXES

The Company accounts for income taxes in accordance with Statement of Financial Accounting Standards No. 109, “Accounting for Income Taxes”. SFAS No. 109 requires the Company to provide a net deferred tax asset/liability equal to the expected future tax benefit/expense of temporary reporting differences between book and tax accounting methods and any available operating loss or tax credit carryforwards.

The Company has available at March 31, 2005, unused operating loss carryforwards of approximately $79,800 which may be applied against future taxable income and which expire in various years through 2025. The amount of and ultimate realization of the benefits from the operating loss carryforwards for income tax purposes is dependent, in part, upon the tax laws in effect, the future earnings of the Company, and other future events, the effects of which cannot be determined. Because of the uncertainty surrounding the realization of the loss carryforwards, the Company has established a valuation allowance equal to the tax effect of the loss carryforwards and, therefore, no deferred tax asset has been recognized for the loss carryforwards. The net deferred tax assets are approximately $27,100 and $26,800 as of March 31, 2005 and December 31, 2004, respectively, with an offsetting valuation allowance of the same amount, resulting in a change in the valuation allowance of approximately $300 during the three months ended March 31, 2005.

FREEDOM RESOURCES ENTERPRISES, INC.

[A Development Stage Company]

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

NOTE 10 - LOSS PER SHARE

The following data show the amounts used in computing loss per share for the periods presented:

For the Three

From Inception

Months Ended

on November 6,

March 31,

1996 Through

^{_____________________}

March 31,

2005

2004

2005

^__________

^____________

Loss from continuing operations available

to common shareholders

(numerator)

(891)

(1,128)

(103,187)

^__________

^____________

Cumulative effect of change in

accounting principle (numerator)

(221)

^__________

^____________

Weighted average number of

common shares outstanding

used in loss per share for the

period (denominator)

4,750,000

3,750,000

3,580,176

^__________

^____________

Dilutive loss per share was not presented, as the Company had no common stock equivalent shares for all periods presented that would affect the computation of diluted loss per share. At March 31, 2005, the Company had a note payable convertible into 1,000,000 shares which was not used in the computation of loss per share because its effect would be anti-dilutive.

NOTE 11 – SETTLEMENT OF DEBT

In February 2005, the Company settled accounts payable of $9,097 for $5,000 cash and recognized a $4,097 gain on settlement of debt.

NOTE 12 - CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE

In 1996, the Company paid $288 in organization costs which reflect amounts expended to organize the Company. The Company was previously amortizing the costs, but during 1998, in accordance with Statement of Position 98-5, the Company expensed the remaining $221 in organization costs which has been accounted for as a change in accounting principle.

NOTE 13 – SUBSEQUENT EVENT

Related Party Advance - In July 2005, a shareholder of the Company advanced $1,000 to the company.

Item 2. Management’s Discussion and Analysis of Financial Condition or Plan of Operation

Forward-Looking Statement Notice

This Form 10-QSB contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For this purpose any statements contained in this Form 10-QSB that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, words such as “may,” “will,” “expect,” “believe,” “anticipate,” “estimate” or “continue” or comparable terminology are intended to identify forward-looking statements. These statements by their nature involve substantial risks and uncertainties, and actual results may differ materially depending on a variety of factors, many of which are not within our control. These factors include but are not limited to economic conditions generally and in the industries in which we may participate; competition within our chosen industry, including competition from much larger competitors; technological advances and failure to successfully develop business relationships.

Description of Business.

Freedom Resources Enterprises, Inc., was incorporated in the state of Nevada on November 6, 1996 to research and publish a self-improvement book based on the insights and understandings of major world cultures. The working title for the proposed book was Personal Freedom and Prosperity. We did not publish the book, but instead used materials gathered during our research to develop a series of eight self-help workshops. Each self-taught workshop consists of an audiotape and a workbook. The workshops are sold online under a marketing agreement with Life Discovery Institute, a related party that maintains a website dedicated to self-improvement products and education. As of March 31, 2005, we have total revenue of $2,060 since inception on November 6, 1996.

Our principal purpose is to sell our techniques in critical thinking, self-image psychology, and self-motivation to help people improve the quality of their lives. We are dedicated to the discovery and implementation of critical insights and understandings that are intended to give people a clearer view of themselves, others, and the world in which they live.

Our research indicates that cultures either enter into prosperity, or fall into decline, as a result of the fundamental views held by its citizenry. We believe these fundamental views are the product of contributions from many disciplines. While some of these contributions help produce honest and clear thinking, other contributions produce dishonesty and confusion, leading to an eventual social decline. We believe that clear and thoughtful views are essential for a society to thrive. Our workshops are intended to help people develop problem-solving techniques through clear and honest thinking. We hope that people who use our workshops will be able to secure personal freedom and prosperity and contribute to society.

Our Products

Our research is condensed into a series of eight self-taught workshops. Each workshop consists of an audiotape and a workbook directed toward improving a particular facet of an individual’s quality of life or interaction with others.

The Company’s eight workshops are titled:

Provisional vs. Providential Living: This workshop introduces our research and explains our philosophy.

The Reality-Based Dream: This workshop attempts to help people to distinguish between internal conflicts and external forces in business dealings and personal relationships.

Real and Assumed Needs: This workshop is directed towards helping people identify and prioritize their needs and desires.

Real Choice: This workshop is intended to help people make decisions that will have a positive impact on their lives and the lives of others.

Circumstances-- Friend or Foe: This workshop examines how people deal with conflict and suggests strategies to achieve positive results under negative circumstances.

Destiny vs. Fate: This workshop provides strategies intended to help people exercise greater control over their lives.

Meaning and The Dream: This workshop is intended to help people identify what is truly important in their lives and suggests strategies for achieving personal goals.

Never Ending Journey: This is the final workshop in the series, summarizing our research and self-improvement strategies.

Our Contract with Life Discovery Institute

On May 31, 2001, we entered into an exclusive agreement with the Life Discovery Institute (“LDI”), an education and publishing organization operated by our president, to sell our workshops through their website. Our agreement is for a term of five years and is currently the only source of distribution for our workshops. We may seek additional sources of distribution in the future but we have no agreements or arrangements in place or pending at the present time.

Competition

The self-improvement and motivational training industry in general is very competitive, with several major companies involved. We face competition from large, well-established companies with considerably greater financial, marketing, sales and technical resources than those available to us. Additionally, many of our present and potential competitors have research and development capabilities that may allow such competitors to develop new and improved products that may compete with our products.

Our direct competitors utilize much of the same philosophy for self-improvement and motivation, and use the same or similar medium for marketing their products and services. We expect to encounter substantial competition in our efforts to promote, sell, and market our products.

Three Month Periods Ended March 31, 2005 and 2004

Our revenues since inception total $2,060 and we have a cumulative net loss of $103,408 from inception through March 31, 2005. For the three months ending March 31, 2005 net loss was $891 compared to $1,128 for the same period in 2004. Expenses during the three months ended March 31, 2005, consisted of $4,940 in general and administrative expense. Expenses during the comparable period in 2004 totaled $1,528 and consisted of $86 in depreciation and amortization and $1,442 in general and administrative expenses. In February of 2005 the company issued a $5,000 convertible promissory note to a shareholder. Interest on the note totaled $48 for the three months ended March 31, 2005. In addition the company had a gain on settlement of debt that totaled $4,097.

As of March 31, 2005 our total assets were $225 consisting of cash. Total current liabilities at March 31, 2005 were $45,965 consisting of $43,674 in accounts payable, $1,370 in advances from a shareholder, $873 in accrued taxes, and $48 in accrued interest. We also had and a convertible note payable to a shareholder of $5,000.

Liquidity and Capital Resources

At March 31, 2005 we had $225 cash and have had total revenues since inception of $2,060. We expect that we will generate additional future revenues through our marketing agreement with LDI although we cannot assure this. Since inception, we have focused our attention on the research and development of our workshops and the LDI website. In the coming months we will turn our attention to actively promoting our products and attracting potential customers to the LDI website. Possible strategies include developing links with online search engines and news groups and exploring cross-promotions with other websites dedicated to self-improvement. If these efforts are unsuccessful, we may explore supplementary means of marketing our workshops. However, we are not seeking additional sources of marketing or distribution at the present time.

We estimate that general and administrative expenses for the next twelve months will be approximately $10,000 to $15,000. At March 31, 2005 we also had total liabilities of $50,965. As a result, we will need to generate up to $70,000 to pay our debts and meet our ongoing financial needs. Since inception we have primarily financed our operations through the sale of common stock. In order to raise the necessary capital to continue operations, we may sell additional stock, arrange debt financing or seek advances from our officers or shareholders. We do not have any commitments for financing.

Item 3. Controls and Procedures

(a)

Evaluation of Disclosure Controls and Procedures. The Company's management, with the participation of the chief executive officer/chief financial officer, carried out an evaluation of the effectiveness of the Company's "disclosure, controls and procedures" (as defined in the Securities Exchange Act of 1934 (the "Exchange Act") Rules 13a-15(e) and 15-d-15(e) as of the end of the period covered by this quarterly report (the "Evaluation Date"). Based upon that evaluation, the chief executive officer/chief financial officer concluded that, as of the Evaluation Date, the Company's disclosure, controls and procedures are effective, providing material information relating to the Company as required to be disclosed in the reports the Company files or submits under the Exchange Act on a timely basis.

(b)

Changes in Internal Control over Financial Reporting. There were no changes in the Company's internal controls over financial reporting, known to the chief executive officer or the chief financial officer, that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

PART II. OTHER INFORMATION

Item 6. Exhibits and Reports on Form 8-K.

Reports on Form 8-K: Freedom Resources did not file any reports on Form 8-K during the period covered by this report.

Exhibit No.

SEC Ref. No.

Title of Document

Location

31.1

Certification of the Principal Executive Officer/ Principal

Financial Officer pursuant to Section 302 of the Sarbanes

-Oxley Act of 2002

Attached

32.1

Certification of Chief Executive Officer and Chief Financial

Officer pursuant to section 906 of the Sarbanes-Oxley Act

of 2002*

Attached

* The Exhibit attached to this Form 10-QSB shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act") or otherwise subject to liability under that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.

SIGNATURES

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

FREEDOM RESOURCES ENTERPRISES, INC.

Date: December 27, 2005

/s/ Neil Christiansen

Neil Christiansen

Chief Executive Officer

Chief Financial Officer