10-Q/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q/A

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

For the quarterly period ended June 30, 2011

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

For the transition period from __________ to __________

Commission File Number 333-141482

Princeton Security Technologies, Inc.

(Exact name of registrant as specified in its charter)

Nevada	20-5506885
(State or other jurisdiction of	(IRS Employer Identification No.)
Incorporation or organization)

303C College Road, Princeton, New Jersey 08540

 (Address of principal executive offices)       (Zip Code)

609-924-7310

 (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 past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

 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 [X]   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.

Large 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]

Indicate the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date.

14,233,513 shares of $0.001 par value common stock on July 31, 2011

EXPLANATORY NOTE

The purpose of this Amendment No.1 to the Quarterly Report of Princeton Security Technologies, Inc (the “Company”) on Form 10-Q for the quarterly period ended June 30, 2011,filed with the Securities and Exchange Commission on August 15,2011(the ‘Form 10-Q), is to furnish Exhibit 101 to the Form 10-Q in accordance with Rule 405 of Regulation S-T and to furnish Exhibit 21.01 to the Form 10-Q. Exhibit 101 to this report provides the consolidated financial statements and related notes from the Form 10-Q formatted in XBRL (eXtensible Business Reporting Language).

Other than the aforementioned, no other changes have been made to the Form 10-Q. This Amendment No.1 to the Form 10-Q speaks as of the original filing date of the Form 10-Q, does not reflect events that may have occurred subsequent to the original filing date, and does not modify or update in any way disclosures made in the original Form 10-Q.

Pursuant to Rule 406T of the Regulation S-T, the interactive data files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

Part I - FINANCIAL INFORMATION

Item 1. Financial Statements

Princeton Security Technologies, Inc.

FINANCIAL STATEMENTS

June 30, 2011

The financial statements included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission.  Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted.  However, in the opinion of management, all adjustments (which include only normal recurring accruals) necessary to present fairly the financial position and results of operations for the periods presented have been made.  These financial statements should be read in conjunction with the accompanying notes, and with the historical financial information of the Company.

PRINCETON SECURITY TECHNOLOGIES, INC.
CONSOLIDATED BALANCE SHEETS
	June 30, 2011				December 31, 2010
ASSETS	(Unaudited)
Current Assets
Cash		$	214,366		$	39,567
Accounts receivable -net of allowance			163,677			225,827
Other receivables			33,463			1,030
Inventory			435,090			289,872
Prepaid expenses			50,688			58,729
Total Current Assets			897,284			615,025
Property, plant & equipment (net of accumulated depreciation of $1,403,185 and $1,398,115 respectively)			31,924			24,596
Total Assets		$	929,208		$	639,621
LIABILITIES
Accounts payable		$	236,210		$	178,074
Accrued expenses			49,445			48,526
Accrued related party expenses			20,000			36,000
Accrued vacation expenses			41,732			33,647
Credit line advances			-			23,684
Deferred revenue			149,238			159,450
Total Current Liabilities			496,625			479,381
Total Liabilities			496,625			479,381
STOCKHOLDERS’ EQUITY
Preferred stock; $.001 par value, 10,000,000 shares authorized; no shares issued and outstanding			-			-
Common stock; $.001 par value, 90,000,000 shares authorized; 14,233,513 and 14,043,513 shares issued and outstanding as of June 30, 2011 and December 31, 2010, respectively			14,233			14,043
Additional paid-in capital			2,002,485			1,961,575
Retained earnings (deficit)			(1,584,135	)		(1,815,378	)
Total Stockholders’ Equity			432,583			160,240
Total Liabilities and Stockholders’ Equity		$	929,208		$	639,621
See notes to Unaudited Consolidated Financial Statements.

PRINCETON SECURITY TECHNOLOGIES, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2011			2010			2011			2010
Revenues
Sales (net of returns)	$	892,351			455,076		$	1,762,872			940,777
Costs of goods sold		463,110			258,724			874,388			509,624
Gross Profit		429,241			196,352			888,484			431,153
Expenses
Depreciation and amortization		1,409			5,518			5,070			11,037
Selling and marketing		69,217			53,957			124,937			108,122
General and administrative		224,967			152,272			382,025			324,419
Research and development		78,549			78,384			140,460			144,405
Total Expenses		374,142			290,131			652,492			587,983
Profit from operations		55,099			(93,779	)		235,992			(156,830	)
Other income/(expenses)		(4,289	)		769			(4,749	)		(1,771	)
Provision for income taxes		-			-			-			-
Net Profit/(Loss)	$	50,810			(93,010	)		231,243			(158,601	)
Net Profit/(Loss) per share of common stock	$	0.00			(0.01	)		0.02			(0.01	)
Weighted average number of common shares		14,233,513			13,729,172			14,055,331			13,727,601
See notes to Unaudited Consolidated Financial Statements.

PRINCETON SECURITY TECHNOLOGIES, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
For the six months ended June 30, 2011 and 2010
	2011			2010
Cash flow from operating activities
Net income/(loss)	$	231,243		$	(158,601	)
Depreciation and amortization		5,070			11,037
Stock issued for services		41,100			12,000
Change in operating assets and liabilities
Accounts receivable		62,150			132,305
Other receivables		(32,433	)		(11,847	)
Inventory		(145,218	)		(38,437	)
Prepaid expenses		8,041			11,469
Accounts payable		58,136			(16,046	)
Accrued expenses		2,991			11,660
Warranty expenses		(9,987	)		(5,250	)
Deferred revenue		(10,212	)		67,579
Cash flow provided by operating activities		210,881			15,869
Cash flow from investing activities
Purchase of property and equipment		(12,398	)		(10,350	)
Cash flow used in investing activities		(12,398	)		(10,350	)
Cash flow from financing activities
Lines of Credit		(23,684	)		490
Cash flow provided by financing activities		(23,684	)		490
Increase/(decrease) in cash position		174,799			6,009
Cash position at beginning of period		39,567			21,333
Cash position at end of period	$	214,366		$	27,342
Supplemental disclosure of cash flow information:
Cash paid for:
Interest expense	$	-		$	-
Income taxes	$	-		$	-
See notes to Unaudited Consolidated Financial Statements.

PRINCETON SECURITY TECHNOLOGIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months ending June 30, 2011 and 2010

Note 1           Organization

Princeton Security Technologies, Inc. (the Company) was incorporated on September 8, 2006 in the State of Nevada. The Company is the holding company of Princeton Gamma-Tech Instruments, Inc. (PGTI). PGTI was incorporated on February 16, 2005 in the State of New Jersey. On February 19, 2005, PGTI purchased the assets of Princeton Gamma-Tech, Inc.  This acquisition included the assets, liabilities, operations, clients and intellectual property of Princeton Gamma-Tech, Inc., including its wholly owned subsidiary in the United Kingdom, Princeton Gamma-Tech (UK) Limited.  On December 28, 2006, Princeton Gamma-Tech (UK) Limited was sold.  The Company has elected a fiscal year end of December 31.

Recently Enacted Accounting Standards

In June 2009, the FASB established the Accounting Standards Codification (“Codification” or “ASC”) as the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in accordance with generally accepted accounting principles in the United States (“GAAP”). Rules and interpretive releases of the Securities and Exchange Commission (“SEC”) issued under authority of federal securities laws are also sources of GAAP for SEC registrants. Existing GAAP was not intended to be changed as a result of the Codification, and accordingly the change did not impact our financial statements. The ASC does change the way the guidance is organized and presented.

Statement of Financial Accounting Standards (“SFAS”) No. 165 (ASC Topic 855), “Subsequent Events”, SFAS No. 166 (ASC Topic 810), “Accounting for Transfers of Financial Assets-an Amendment of FASB Statement No. 140”, SFAS No. 167 (ASC Topic 810), “Amendments to FASB Interpretation No. 46(R),” and SFAS No. 168 (ASC Topic 105), “The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles- a replacement of FASB Statement No. 162” were recently issued. SFAS No. 165, 166, 167, and 168 have no current applicability to the Company or their effect on the financial statements would not have been significant.

Accounting Standards Update (“ASU”) ASU No. 2009-05 (ASC Topic 820), which amends Fair Value Measurements and Disclosures – Overall, ASU No. 2009-13 (ASC Topic 605), Multiple-Deliverable Revenue Arrangements, ASU No. 2009-14 (ASC Topic 985), Certain Revenue Arrangements that include Software Elements, and various other ASU’s No. 2009-2 through ASU No. 2011-07 which contain technical corrections to existing guidance or affect guidance to specialized industries or entities were recently issued. These updates have no current applicability to the Company or their effect on the financial statements would not have been significant.

Note 2           Business Activity

Princeton Gamma-Tech Instruments, Inc. is a leading supplier of X-ray and Gamma-ray Detectors and Spectroscopy systems and  Radioactive Isotope Identifiers. The Company serves a broad customer base in scientific research, industrial materials analysis, and Homeland Security. The Company operates a full customer service and support program, backed by a modern manufacturing and service facility.

Note 3           Use of Estimates in the preparation of the financial statements

The preparation of the Company's financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in these financial statements and accompanying notes. Actual results could differ from those estimates. The interim financial information is unaudited.  Interim results are not necessarily indicative of results of operations for the full year. The condensed consolidated financial statements include the accounts of Princeton Security Technologies, Inc. and subsidiary after elimination of inter-company transactions and accounts.

PRINCETON SECURITY TECHNOLOGIES, INC.

NOTES TO) CONSOLIDATED FINANCIAL STATEMENTS (Continued)

For the Three Months ending June 30, 2011 and 2010

Note 4           Subsequent Events

The Company has evaluated subsequent events from the balance sheet date through the date of this filing, and no  significant events have occurred.

At the present time there is no projected taxable income as the existing carried over losses will continue to be offset by the valuation allowance.

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

Special Note Regarding Forward-Looking Statements

This periodic report contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the Plan of Operations provided below, including information regarding the Company’s financial condition, results of operations, business strategies, operating efficiencies or synergies, competitive positions, growth opportunities, and the plans and objectives of management. The statements made as part of the Plan of Operations that are not historical facts are hereby identified as "forward-looking statements."

Business of the Company

Corporate Information

Princeton was founded in February 2005 to acquire the detector and microanalysis business of Outokumpu Oyj.  In February 2005, Princeton completed the acquisition of the detector and microanalysis business from a subsidiary of Outokumpu Oyj.  As part of the acquisition of the business, Princeton retained the management and scientific staff of the subsidiary’s detector business unit to continue to operate the detection and microanalysis business.  Additionally, Princeton assumed the lease on the premises occupied by Outokumpu Oyj.  The facilities were located in Rocky Hill, New Jersey and served as the Company’s offices, manufacturing and research facilities.  In March 2006, Princeton moved its offices to 303C College Road East, Princeton, and New Jersey where its management, manufacturing and research and development are currently located.

As part of the goal in acquiring the detector business, following the acquisition, Princeton divested the Microanalysis business to a subsidiary of Bruker Biosciences Corp. so that management could focus on, what it believed to be, the more lucrative and profitable detector business within the Homeland Security industry.

In September 2006, Princeton restructured its corporate status by creating a Nevada corporation called Princeton Security Technologies, Inc. to be the holding company of Princeton Gamma Tech Instruments, Inc.  Management reincorporated in Nevada and completed a stock exchange making Princeton Gamma Tech Instruments the wholly owned subsidiary of the Nevada Corporation.  The creation of a Nevada parent corporation was accomplished as part of Princeton’s ongoing efforts to start seeking equity investments from outside investors.   Princeton offices and facilities will continue to be located in Princeton, New Jersey.   Princeton’s primary focus will continue to be on the X-ray and Gamma-ray Detector  systems, as well as Radioactive Isotope Identifier products. Our products detect radioactive and other nuclear materials in various security and environmental settings.

Products

Through the purchase of the detector business, Princeton acquired X-ray and Gamma-ray Detectors and Spectroscopy systems, and Radioisotope Identifier products.  More importantly, we also acquired the management and scientific teams responsible for the development of this technology.  Currently we produce both individual detection units as well as component parts for larger units manufactured and sold by other companies.

The uses for our products encompass a variety of industrial, commercial and security concerns ranging from the homeland security need to detect concealed radioactive material, to silicon wafer fabrication companies that use our products and components to analyze silicon wafers for defects.

The nature of our technology allows our products to encompass a variety of uses.   Our products typically have three basic technologies that can be combined to create a detection unit or system.  Each of our products contains a sensor or a detector, electronic circuitry to process the signal from the sensor and firmware or software to analyze and interpret the processed signal.  Princeton has design, development and manufacturing capability in all three-technology areas.  By focusing on these three core competencies used in detectors and components, we are able to design products for multiple industries and users.

As part of our core technology, we have developed the internal capability to produce a high purity germanium radiation detectors, Sodium Iodide and Lanthanum Bromide Isotope Identifier solutions, which are the key component in Gamma-ray detection systems.  We do also have an internal capability to process x-ray detectors, such as SiLi and Silicon Drift detectors. These capabilities allow us to compete with the limited number of companies who have the ability to work with these types of sensors.  These sensors are most frequently used to detect radioactive isotopes.

Currently, our product line includes the following component and detectors:

-   Category 1: Radioactive Isotope Identifier Products.

The current product is termed the SAM Radioactive Isotope Identifiers (RIID).  This hand-held instrument is a self-contained radiation detector, low-noise signal processor, and user interface.  Our proprietary analysis software provides an intuitive color display suitable for both First Responders as well as more technically trained Health Physicists.  This product and product versions are mainly used for large homeland security market applications, as well as for environmental, industrial and medical purposes.  This product detects neutron and gamma radiation from over 100 isotopes. The SAM was designed to meet the latest American National Standards Institute “ANSI” and other government standards for portable radiation detection equipment.

We introduced recently a Fixed Installation unit, called Area Monitor, to our product offering. That product is being offered and used in e.g. building security applications, hospitals, and industrial applications and generally in security applications where an identified area or facility needs to be secured. .We recently introduced  gamma – neutron Area Monitor which is the latest addition to our Radioactive Isotope Identifier product family.

-   Category 2: Nuclear/ Gamma-ray detectors and spectrometers:

Princeton is one of the handful of companies worldwide that manufactures and processes High Purity Germanium Detectors and associated electronics and software for the most sensitive and accurate detection and analysis of radioactive samples in a laboratory environment.  A typical application is the measurement of very low-levels of radioisotopes in soil, water or geological samples to determine the efficacy of radioactive waste cleanup or to conduct geophysics research.  This type of lab-based instrumentation is also used by the nuclear power industry for on-line monitoring.  Customers include Federal and State governmental authorities, research laboratories and large corporations.

-   Category 3: X-ray detectors and spectrometers.

These products address the research and industrial analysis need in the Microanalysis or XRF market. The Microanalysis Market is the branch of industry and scientific research that requires the non-destructive analysis of materials on a sub-millimeter dimensional scale.

The non-destructive testing of materials by X-ray analysis utilizes a range of detector products from small hand-held units to large systems installed on a Synchrotron and used for the fundamental research of materials.  Princeton supplies both detector components as an OEM supplier and also complete X-ray spectrometer systems.  Applications include quality control (e.g., for Silicon wafer fabrication), fundamental material research (e.g., on a synchrotron), and industrial control and monitoring, (e.g., engine wear analysis). A typical application is analyzing various metals for quality or research purposes.

Discussion and Analysis of Financial Condition and Results of Operations

Critical Accounting Policies and Estimates

The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the unaudited Condensed Consolidated Financial Statements and accompanying notes.  Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from these estimates under different assumptions or conditions.  The Company believes there have been no significant changes during the period ended June 30, 2011.

The Company’s accounting policies are more fully described in Note 1 of the consolidated financial statements.  As discussed in Note 1, the preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions about the future events that affect the amounts reported in the consolidated financial statements and the accompanying notes. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances.  Actual differences could differ from these estimates under different assumptions or conditions.  The Company believes that the following addresses the Company’s most critical accounting policies.

We recognize revenue in accordance with Securities and Exchange Commission Staff Accounting Bulletin No. 104, “Revenue Recognition” (“SAB 104”).  Under SAB 104, revenue is recognized at the point of passage to the customer of title and risk of loss, when there is persuasive evidence of an arrangement, the sales price is determinable, and collection of the resulting receivable is reasonably assured.  We recognize revenue as services are provided with specific long lead-time orders.

Our allowance for doubtful accounts is maintained to provide for losses arising from customers’ inability to make required payments.  If there is deterioration of our customers’ credit worthiness and/or there is an increase in the length of time that the receivables are past due greater than the historical assumptions used, additional allowances may be required. For example, at June 30, 2011, every additional one percent of our accounts receivable that becomes uncollectible would reduce our operating income by approximately $1,637.

We account for income taxes in accordance with ASC Topic 740. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which the differences are expected to reverse.  Deferred tax assets will be reflected on the balance sheet when it is determined that it is more likely than not that the asset will be realized.  A valuation allowance has currently been recorded to reduce our deferred tax asset to $0.

Our Business Growth

For the quarter ended June 30, 2011 our sales increased approximately 96% to $892,351 from $455,076 for the same period last year. Our gross profit increased to $429,241 compared to $196,352 for the same period in 2010. This represents approximately 118% increase in Gross Profit. Our Radioactive Isotope Identifier Products had the biggest sales volume of all product categories, $728,553, totaling about 82 % of the total sales for the quarter ending June 30, 2011; Nuclear Detector Products produced 9% and X-ray Detectors 9%. The largest growth in the quarter ended June 30, 2011, came from Radioactive Isotope Identifier Products, due to purchases from our domestic OEM customers as well as new customers who received orders related to Japan Nuclear power crises during the quarter ended June 30, 2011.  We anticipate the biggest growth to continue to come from Radioactive Isotope Identifier products due to continued demand coming from  Nuclear crisis as well as from Nuclear detectors due to increased demand on Nuclear Power market.

Results of Operations

Total sales increased 96% for the comparable quarterly periods in June30, 2011 from 2010 due to increased  sales in Radioactive Isotope Identifier Products.  Our gross profit increased by 118% or $232,889 for the quarter ending June 30 2011 compared to the same period in 2010. Our operating expenses increased to $374,142 for the quarter ended June 30, 2011, from $290,131 for the same period last year. Our Net Profit was  $50,810 compared to a net loss of $93,010 for the same period in 2010.

The quarterly profit was a combination of increased overall sales volume and the higher gross profit margin compared to previous quarters due to more favorable product mix as well as improved cost of goods. We continue to invest in our Research and Development activities, which partially affects our net profit for the next few quarters.  As we have had a chance to work on our production efforts, we have been able to keep the cost of goods in control.  We are hopeful, as our R&D will generate new products we are able to increase sales as well as continue to stay profitable, which can be done with the similar quarterly sales revenue and cost structure.

Overall we will be dependent on sales to stay on current levels in order to stay profitable.  We may have to seek additional financing to fund additional R&D projects.

Seasonality and Cyclicality

In our business, we have experienced lower sales volume during the past years in the first two quarters in general.  We believe this trend may continue in the future, as well.

Liquidity and Capital Resources

Historically, we have financed our working capital requirements through internally generated funds and sales of equity and debt securities. Since inception through June 30, 2011, we raised approximately $2 million from the sale of equity securities.  As we continue to expand our operations, we anticipate seeking additional capital through the sale of equity securities.  Our goal is to position Princeton to be able to raise larger amounts of equity capital through the public markets or through private investments.  At this time we do not know the extent of the overall financing we will need in the future.  Financing will depend on how well our products are received in the marketplace.

At June 30, 2011, we had $400,659 in working capital.  The biggest component in current liabilities as of June 30, 2011, was our Accounts Payable of $236,210.  We feel we will be able to service ongoing payables and liabilities with current revenue and existing capital.  Our current assets consist of $214,366 in cash, $163,677 in accounts receivable and $435,090 in inventory. Therefore we will be dependent on selling our inventory and collecting receivables to cover our payables.  We may seek additional debt or equity capital to cover any liquidity needs that may arise as we try and increase sales.

We anticipate profits to continue for the year because of an estimated higher sales volume, due to existing order backlog for the next quarter.  However, it is our goal to increase R&D expenses for the new products, which may require additional capital. In the future, we may issue additional debt or equity securities to satisfy our cash needs.  Any debt incurred or issued may be secured or unsecured, at a fixed or variable interest rates and may contain other terms and conditions that our board of directors deems prudent.  Any sales of equity securities may be at or below existing market prices.

Off-Balance Sheet Arrangements

We have no off balance sheet arrangements as of June 30, 2011.

Forward-looking Statements

The Private Securities Litigation Reform Act of 1995 (the “Act”) provides a safe harbor for forward-looking statements made by or on behalf of our Company. Our Company and our representatives may from time to time make written or oral statements that are “forward-looking,” including statements contained in this Quarterly Report and other filings with the Securities and Exchange Commission and in reports to our Company’s stockholders. Management believes that all statements that express expectations and projections with respect to future matters, as well as from developments beyond our Company’s control including changes in global economic conditions are forward-looking statements within the meaning of the Act. These statements are made on the basis of management’s views and assumptions, as of the time the statements are made, regarding future events and business performance. There can be no assurance; however, that management’s expectations will necessarily come to pass. Factors that may affect forward- looking statements include a wide range of factors that could materially affect future developments and performance, including the following:

Changes in Company-wide strategies, which may result in changes in the types or mix of businesses in which our Company is involved or chooses to invest; changes in U.S., global or regional economic conditions, changes in U.S. and global financial and equity markets, including significant interest rate fluctuations, which may impede our Company’s access to, or increase the cost of, external financing for our operations and investments; increased competitive pressures, both domestically and internationally, legal and regulatory developments, such as regulatory actions affecting environmental activities, the imposition by foreign countries of trade restrictions and changes in international tax laws or currency controls; adverse weather conditions or natural disasters, such as hurricanes and earthquakes, labor disputes, which may lead to increased costs or disruption of operations.

This list of factors that may affect future performance and the accuracy of forward-looking statements are illustrative, but by no means exhaustive. Accordingly, all forward-looking statements should be evaluated with the understanding of their inherent uncertainty.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk.

This item is not required for Smaller Reporting Companies.

Item 4.  Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our President and Principal Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, our President and Principal Financial Officer concluded that our disclosure controls and procedures as of the end of the period covered by this report were effective such that the information required to be disclosed by us in reports filed under the Exchange Act is (iI) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to our management, including our President and Principal Financial Officer, as appropriate to allow timely decisions regarding disclosure. A controls system cannot provide absolute assurance, however, that the objectives of the controls system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.

Management’s Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance of achieving their control objectives.

Our management, with the participation of the President and Principal Financial Officer, evaluated the effectiveness of our internal control over financial reporting as of June 30, 2011.  Based on this evaluation, our management, with the participation of the President and Principal Financial Officer, concluded that, as of June 30, 2011, our internal control over financial reporting was effective.

Changes in internal control over financial reporting

There have been no changes in internal control over financial reporting that occurred during the last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1.  Legal Proceedings

None

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

Recent Sales of Unregistered Securities

We have not sold any restricted securities during the three months ended June 30, 2011.

Use of Proceeds of Registered Securities

None. Not applicable.

Purchases of Equity Securities by Us and Affiliated Purchasers

During the three months ended June 30, 2011, we have not purchased any equity securities nor have any officers or directors of the Company.

ITEM 3.  Defaults Upon Senior Securities

We are not aware of any defaults upon senior securities.

ITEM 4.  Removed and Reserved

ITEM 5. Other Information

None

ITEM 6.  Exhibits

(a) Exhibits.

Item 4	Exhibit No.	Instruments Defining the Rights of Security Holders	Location
4.01	4	Specimen Stock Certificate	Incorporated
			By Reference*
31.01	31	CEO certification Pursuant to 18 USC Section 1350,
		as adopted pursuant to Section 302
		of Sarbanes-Oxley Act of 2002	Filed August 15, 2011
31.02	31	Principal Financial Officer certification Pursuant
		to 18 USC Section 1350, as adopted pursuant
		to Section 302 of Sarbanes-Oxley Act of 2002	Filed August 15, 2011
32.01	32	CEO Certification pursuant to section 906	Filed August 15, 2011
32.02	32	Principal Financial Officer Certification pursuant to Section 906	Filed August 15, 2011
	101.INS	XBRL Instance	This Filing
	101.XSD	XBRL Schema	This Filing
	101.CAL	XBRL Calculation	This Filing
	101.DEF	XBRL Definition	This Filing
	101.LAB	XBRL Label	This Filing
	101.PRE	XBRL Presentation	This Filing

* Incorporated by reference from the Company's registration statement on Form SB-2 filed with the Commission, SEC file no. 333-141482.

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.

	Princeton Security Technologies, Inc.
	(Registrant)
Date:   August 12, 2011	By:	/s/ Juhani Taskinen
August 12, 2011	By:	/s/ Trupti Mehta
		Juhani Taskinen, CEO and Trupti Mehta,Principal Financial Officer

EX-31.1

Exhibit 31.1

Certification of Principal Executive Officer

Pursuant to 18 U.S.C. 1350

 (Section 302 of the Sarbanes-Oxley Act of 2002)

I, Juhani Taskinen certify that:

1.   I have reviewed this quarterly report on Form 10-Q of Princeton Security Technologies, Inc.;

2.   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.   The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.   Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.   Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.   The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a.   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b.   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 10, 2011                                         

Princeton Security Technologies, Inc.

/s/ Juhani Taskinen                                                      

Juhani Taskinen, Chief Executive Officer

EX-31.2

Exhibit 31.2

Certification of Principal Financial Officer

Pursuant to 18 U.S.C. 1350

(Section 302 of the Sarbanes-Oxley Act of 2002)

I, Trupti Mehta certify that:

1.   I have reviewed this quarterly report on Form 10-Q of Princeton Security Technologies, Inc.;

2.   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.   The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.   Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.   Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.   The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a.   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b.   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 10, 2011                                                                          

Princeton Security Technologies, Inc.

/s/ Trupti Mehta                                                               

Trupti Mehta, Principal Financial officer

EX-32.1

                                                                    EXHIBIT 32.1

Certification of Principal Executive Officer

Pursuant to 18 U.S.C. 1350

(Section 906 of the Sarbanes-Oxley Act of 2002)

The undersigned, Juhani Taskinen, Chief Executive Officer, and Trupti Mehta, Principal Financial Officer, of Princeton Security Technologies, Inc. (the "Registrant") do hereby certify, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of our knowledge, based upon a review of the Quarterly Report on Form 10-Q for the period June 30, 2011 of the Registrant, as filed with the Securities and Exchange Commission on the date hereof (the "Report"):

 (1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

 (2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

Dated:  August 10, 2011                                                                

By:  /s/ Juhani Taskinen                                                                                              

Juhani Taskinen

Chief Executive Officer

   August 10, 2011                                                      

By:  /s/ Trupti Mehta                                                                                                     

Trupti Mehta

Principal Financial Officer

 * A signed original of this written statement required by Section 906 has been provided to Princeton Security Technologies, Inc. and will be retained by Princeton Security Technologies, Inc. and furnished to the Securities Exchange Commission or its staff upon request.

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CONSOLIDATED BALANCE SHEET PARENTHETICALS (USD $)	Jun. 30, 2011	Dec. 31, 2010
Property, plant and equipment, accumulated depreciation	$ 1,403,185	$ 1,398,115
Preferred Stock, par or stated value	$ 0.001	$ 0.001
Preferred Stock, shares authorized	10,000,000	10,000,000
Common Stock, par or stated value	$ 0.001	$ 0.001
Common Stock, shares authorized	90,000,000	90,000,000
Common Stock, shares issued	14,233,513	14,043,513
Common Stock, shares outstanding	14,233,513	14,043,513

XML



UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010
Sales (net of returns)	$ 892,351	$ 455,076	$ 1,762,872	$ 940,777
Costs of goods sold	463,110	258,724	874,388	509,624
Gross Profit	429,241	196,352	888,484	431,153
Depreciation and amortization	1,409	5,518	5,070	11,037
Selling and marketing	69,217	53,957	124,937	108,122
General and administrative	224,967	152,272	382,025	324,419
Research and development	78,549	78,384	140,460	144,405
Total Expenses	374,142	290,131	652,492	587,983
Profit from operations	55,099	(93,779)	235,992	(156,830)
Other income/(expenses)	(4,289)	769	(4,749)	(1,771)
Provision for income taxes	0	0	0	0
Net Profit/(Loss)	$ 50,810	$ (93,010)	$ 231,243	$ (158,601)
Net Profit/(Loss) per share of common stock	$ 0.00	$ (0.01)	$ 0.02	$ (0.01)
Weighted average number of common shares	14,233,513	13,729,172	14,055,331	13,727,601

XML



Document and Entity Information	3 Months Ended
	Jun. 30, 2011	Jul. 31, 2011
Document and Entity Information
Entity Registrant Name	Princeton Security Technologies, Inc.
Document Type	10-Q
Document Period End Date	Jun. 30, 2011
Amendment Flag	false
Entity Central Index Key	0001391614
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		14,233,513
Entity Filer Category	Smaller Reporting Company
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Document Fiscal Year Focus	2011
Document Fiscal Period Focus	Q2

XML



Use of Estimates

3 Months Ended

Jun. 30, 2011

Use of Estimates

Use of Estimates, Policy [Policy Text Block]

Note 3           Use of Estimates in the preparation of the financial statements

The preparation of the Company's financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in these financial statements and accompanying notes. Actual results could differ from those estimates. The interim financial information is unaudited.  Interim results are not necessarily indicative of results of operations for the full year. The condensed consolidated financial statements include the accounts of Princeton Security Technologies, Inc. and subsidiary after elimination of inter-company transactions and accounts.

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Organization, Consolidation and Presentation of Financial Statements

3 Months Ended

Jun. 30, 2011

Organization, Consolidation and Presentation of Financial Statements

Organization, Consolidation and Presentation of Financial Statements Disclosure and Significant Accounting Policies [Text Block]

Note 1           Organization

Princeton Security Technologies, Inc. (the Company) was incorporated on September 8, 2006 in the State of Nevada. The Company is the holding company of Princeton Gamma-Tech Instruments, Inc. (PGTI). PGTI was incorporated on February 16, 2005 in the State of New Jersey. On February 19, 2005, PGTI purchased the assets of Princeton Gamma-Tech, Inc.  This acquisition included the assets, liabilities, operations, clients and intellectual property of Princeton Gamma-Tech, Inc., including its wholly owned subsidiary in the United Kingdom, Princeton Gamma-Tech (UK) Limited.  On December 28, 2006, Princeton Gamma-Tech (UK) Limited was sold.  The Company has elected a fiscal year end of December 31.

Recently Enacted Accounting Standards

In June 2009, the FASB established the Accounting Standards Codification (“Codification” or “ASC”) as the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in accordance with generally accepted accounting principles in the United States (“GAAP”). Rules and interpretive releases of the Securities and Exchange Commission (“SEC”) issued under authority of federal securities laws are also sources of GAAP for SEC registrants. Existing GAAP was not intended to be changed as a result of the Codification, and accordingly the change did not impact our financial statements. The ASC does change the way the guidance is organized and presented.

Statement of Financial Accounting Standards (“SFAS”) No. 165 (ASC Topic 855), “Subsequent Events”, SFAS No. 166 (ASC Topic 810), “Accounting for Transfers of Financial Assets-an Amendment of FASB Statement No. 140”, SFAS No. 167 (ASC Topic 810), “Amendments to FASB Interpretation No. 46(R),” and SFAS No. 168 (ASC Topic 105), “The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles- a replacement of FASB Statement No. 162” were recently issued. SFAS No. 165, 166, 167, and 168 have no current applicability to the Company or their effect on the financial statements would not have been significant.

Accounting Standards Update (“ASU”) ASU No. 2009-05 (ASC Topic 820), which amends Fair Value Measurements and Disclosures – Overall, ASU No. 2009-13 (ASC Topic 605), Multiple-Deliverable Revenue Arrangements, ASU No. 2009-14 (ASC Topic 985), Certain Revenue Arrangements that include Software Elements, and various other ASU’s No. 2009-2 through ASU No. 2011-07 which contain technical corrections to existing guidance or affect guidance to specialized industries or entities were recently issued. These updates have no current applicability to the Company or their effect on the financial statements would not have been significant.

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Subsequent Events

3 Months Ended

Jun. 30, 2011

Subsequent Events

Schedule of Subsequent Events [Table Text Block]

Note 4           Subsequent Events

The Company has evaluated subsequent events from the balance sheet date through the date of this filing, and no  significant events have occurred.

At the present time there is no projected taxable income as the existing carried over losses will continue to be offset by the valuation allowance.

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UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010
Net income/(loss)	$ 231,243	$ (158,601)
Depreciation and amortization	5,070	11,037
Stock issued for services	41,100	12,000
Accounts receivable	62,150	132,305
Other receivables	(32,433)	(11,847)
Inventory	(145,218)	(38,437)
Prepaid expenses	8,041	11,469
Accounts payable	58,136	(16,046)
Accrued expenses	2,991	11,660
Warranty expenses	(9,987)	(5,250)
Deferred revenue	(10,212)	67,579
Cash flow provided by operating activities	210,881	15,869
Purchase of property and equipment	(12,398)	(10,350)
Cash flow used in investing activities	(12,398)	(10,350)
Lines of Credit	(23,684)	490
Cash flow provided by financing activities	(23,684)	490
Increase/(decrease) in cash position	174,799	6,009
Cash position at beginning of period	39,567	21,333
Cash position at end of period	214,366	27,342
Interest expense	0	0
Income taxes	$ 0	$ 0

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Business Combinations

3 Months Ended

Jun. 30, 2011

Business Combinations

Business Combination Disclosure [Text Block]

Note 2           Business Activity

Princeton Gamma-Tech Instruments, Inc. is a leading supplier of X-ray and Gamma-ray Detectors and Spectroscopy systems and  Radioactive Isotope Identifiers. The Company serves a broad customer base in scientific research, industrial materials analysis, and Homeland Security. The Company operates a full customer service and support program, backed by a modern manufacturing and service facility.

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CONSOLIDATED BALANCE SHEETS (USD $)	Jun. 30, 2011	Dec. 31, 2010
Cash	$ 214,366	$ 39,567
Accounts receivable -net of allowance	163,677	225,827
Other receivables	33,463	1,030
Inventory	435,090	289,872
Prepaid expenses	50,688	58,729
Total Current Assets	897,284	615,025
Property, plant & equipment (net of accumulated depreciation of $1,403,185 and $1,398,115 respectively)	31,924	24,596
Total Assets	929,208	639,621
Accounts payable	236,210	178,074
Accrued expenses	49,445	48,526
Accrued related party expenses	20,000	36,000
Accrued vacation expenses	41,732	33,647
Credit line advances	0	23,684
Deferred revenue	149,238	159,450
Total Current Liabilities	496,625	479,381
Total Liabilities	496,625	479,381
Preferred stock; $.001 par value, 10,000,000 shares authorized; no shares issued and outstanding	0	0
Common stock; $.001 par value, 90,000,000 shares authorized; 14,233,513 and 14,043,513 shares issued and outstanding as of June 30, 2011 and December 31, 2010, respectively	14,233	14,043
Additional paid-in capital	2,002,485	1,961,575
Retained earnings (deficit)	(1,584,135)	(1,815,378)
Total Stockholders' Equity	432,583	160,240
Total Liabilities and Stockholders' Equity	$ 929,208	$ 639,621