U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-QSB/A

ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2006

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Commission file number 000-49709

CARDIFF INTERNATIONAL, INC.

(Name of Small Business Issuer as specified in its charter)

Colorado	84-1044583
(State or other jurisdiction of	(I.R.S. employer
incorporation or organization	identification No.)

16255 Ventura Boulevard, Suite 525, Encino, CA 91436

(Address of principal executive offices)

Registrant's telephone no., including area code: (818) 879-9722

N/A

Former name, former address, and former fiscal year, if changed since last report.

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

Securities registered pursuant to Section 12(g) of the Exchange Act: No Par Value Common Stock

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 registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. (1) Yes ý No ¨ (2) Yes ý No¨

Indicate by check mark whether the registrant is an accelerated filer (as defined in rule 12b-2 of the Exchange Act). Yes¨ No ý

Common Stock outstanding at May 16, 2006, 21,596,903 shares of $.001 par value Common Stock.

DOCUMENTS INCORPORATED BY REFERENCE: NONE

FORM 10-QSB

FINANCIAL STATEMENTS AND SCHEDULES

CARDIFF INTERNATIONAL, INC.

For the Quarter ended March 31, 2006

The following financial statements and schedules of the registrant are submitted herewith:

PART I - FINANCIAL INFORMATION

Page of

Form 10-QSB

Item 1.	Financial Statements:
	Balance Sheet	3
	Statements of Operations	4
	Statements of Cash Flows	5 - 6
	Statements of Shareholders’ Equity	7 - 8
	Notes to Financial Statements	9 - 16
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3.	Controls and Procedures, Evaluation of Disclosure Controls and Procedures	21

PART II - OTHER INFORMATION

Page

Item 1.	Legal Proceedings	22
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	22
Item 3.	Defaults Upon Senior Securities	23
Item 4.	Submission of Matters to a Vote of Security Holders	23
Item 5.	Other Information	23
Item 6.	Exhibits	23

2

PART I - FINANCIAL INFORMATION

ITEM 1: FINANCIAL STATEMENTS

CARDIFF INTERNATIONAL, INC. dba LEGACY CARD COMPANY

(A DEVELOPMENT STAGE COMPANY)

BALANCE SHEET

March 31, 2006

ASSETS
	2006
CURRENT ASSETS:
Cash and cash equivalents	$	22,001
Deposit in escrow account		-
TOTAL CURRENT ASSETS		22,001
FIXED ASSETS:
Artwork		6,536
Computer equipment		71,050
Domain names		1,250
Furniture and fixtures		72,984
Leasehold improvements		9,201
Office equipment		31,180
Software		1,596
Accumulated depreciation and amortization		(161,262	)
FIXED ASSETS, NET		32,535
OTHER ASSETS:
Deposits		600
Loan fees, net		9,375
TOTAL ASSETS	$	64,511
CURRENT LIABILITIES:
Accounts payable	$	927,573
Interest payable		120,633
Advances from shareholders		291,987
Note payable - Legacy Investors, current		618,000
Note payable - Maricopa Equity Management Corporation, current		100,000
TOTAL CURRENT LIABILITIES		2,058,193
SHAREHOLDERS EQUITY (DEFICIT):
Common stock, no par value; 30,000,000 shares authorized; 21,411,903 shares issued and outstanding		3,784,091
Additional paid in capital		208,474
Deferred compensation		(11,131	)
Deficit accumulated during the development stage		(5,975,116	)
TOTAL SHAREHOLDERS' EQUITY (DEFICIT)		(1,993,682	)
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)	$	64,511

Prepared without audit.

See notes to financial statements.

3

CARDIFF INTERNATIONAL, INC. dba LEGACY CARD COMPANY

(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF OPERATIONS

THREE MONTHS ENDED MARCH 31, 2006 AND 2005 AND THE PERIOD

AUGUST 29, 2001 (DATE OF INCEPTION) THROUGH MARCH 31, 2006

							August 29, 2001
							(Date of Inception)
	Three Months Ended March 31,						through
	2006			2005			March 31, 2006
REVENUE	$	-		$	-		$	-
COST OF SALES		-			-			-
GROSS PROFIT		-			-			-
OPERATING EXPENSES:
Legal services		102,136			1,070			679,484
Consulting and outside services		88,369			5,175			1,345,218
Salaries and wages		86,143			-			717,089
Guaranteed payments		-			-			512,958
Advertising		-			-			363,800
Rent		-			4,934			411,586
Other operating expenses		157,238			37,693			1,767,755
TOTAL OPERATING EXPENSES		433,886			48,872			5,797,890
NET INCOME (LOSS) FROM OPERATIONS		(433,886	)		(48,872	)		(5,797,890	)
OTHER INCOME AND (EXPENSES):
Sublease rental income		-			-			55,979
Interest income		-			-			6,768
Misc. income		-			-			48,812
Interest expense		(22,666	)		(25,000	)		(288,785	)
TOTAL OTHER INCOME AND (EXPENSES)		(22,666	)		(25,000	)		(177,226	)
LOSS BEFORE INCOME TAXES		(456,552	)		(73,872	)		(5,975,116	)
NET LOSS	$	(456,552	)	$	(73,872	)	$	(5,975,116	)
Basic and diluted earnings (loss) per share		(0.02	)		(0.00	)
Weighted average shares outstanding		21,154,038			17,977,500

Prepared without audit.

See notes to financial statements.

4

CARDIFF INTERNATIONAL, INC. dba LEGACY CARD COMPANY

(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF CASH FLOWS

THREE MONTHS ENDED MARCH 31, 2006 AND 2005 AND THE PERIOD

AUGUST 29, 2001 (DATE OF INCEPTION) THROUGH MARCH 31, 2006

							August 29, 2001
							(Date of Inception)
	Three Months Ended March 31,						through
	2006			2005			March 31, 2006
CASH FLOW FROM OPERATING ACTIVITIES
Net loss	$	(456,552	)	$	(73,872	)	$	(5,975,116	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		10,739			10,614			196,887
Compensation expense		4,770			-			111,609
Issuance of common stock for loan costs		-			-			110,000
Issuance of warrants as loan costs		-			-			85,734
(Increase) decrease in:
Deposits		-			-			(600	)
Increase (decrease) in:
Accounts payable		86,050			-			1,049,144
Interest payable		21,770			25,000			282,743
Payroll and payroll tax payable		-			-			-
NET CASH USED IN OPERATING ACTIVITIES		(333,223	)		(38,258	)		(4,139,599	)
CASH FLOW FROM INVESTING ACTIVITIES
Acquisition of equipment		-			-			(193,797	)
NET CASH USED IN INVESTING ACTIVITIES		-			-			(193,797	)
CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from shareholder advances		24,608			144,200			927,509
Repayments of shareholder advances		(190,076	)		(134,025	)		(758,301	)
Proceeds from note payable-Legacy Investors		-			-			451,428
Proceeds from note payable-Maricopa Equity Management Corporation		-			-			100,000
Proceeds from convertible notes payable		-			-			1,098,699
Proceeds from sale of common stock		547,100			35,000			2,536,062
Book overdraft		(26,408	)		-			-
NET CASH PROVIDED BY FINANCING ACTIVITIES		355,224			45,175			4,355,397
NET INCREASE IN CASH		22,001			6,917			22,001
CASH AT BEGINNING OF THE YEAR		-			5,144			-
CASH AT END OF YEAR	$	22,001		$	12,061		$	22,001
SUPPLEMENTAL DISCLOSURES
Interest paid in cash	$	896		$	-		$	6,028

Prepared without audit.

See notes to financial statements.

5

CARDIFF INTERNATIONAL, INC. dba LEGACY CARD COMPANY

(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF CASH FLOWS

THREE MONTHS ENDED MARCH 31, 2006 AND 2005 AND THE PERIOD

AUGUST 29, 2001 (DATE OF INCEPTION) THROUGH MARCH 31, 2006

NON-CASH ACTIVITIES

Accrued interest in the amounts of $4,320, $0 and $126,593 were capitalized to shareholder advances for the three months ended March 31, 2006 and 2005, and for the period from August 29, 2001 (inception) through March 31, 2006, respectively.

During the year ended December 31, 2005, convertible debt in the about of $1,098,699 plus the related accrued interest of $39,330, was converted into 998,635 shares of common stock.

Out of the $1,000,000 debentures from Legacy Investors, $106,572 was used to pay loan related fees, and $442,000 remained in an escrow account at December 31, 2004. During the year ended December 31, 2005, the escrow funds were returned to Legacy Investors.

Prepared without audit.

See notes to financial statements.

6

CARDIFF INTERNATIONAL, INC. dba LEGACY CARD COMPANY

(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF SHAREHOLDERS’ EQUITY

THREE MONTHS ENDED MARCH 31, 2006 AND 2005 AND THE PERIOD

AUGUST 29, 2001 (DATE OF INCEPTION) THROUGH MARCH 31, 2006

					Additional
	Common Stock				Paid in		Deferred			Accumulated
	Shares		Amount		Capital		Compensation			Deficit			Total
BALANCE, AUGUST 29, 2001
(Date of Inception)		-	$	-	$	-	$	-		$	-		$	-
Issuance for cash, 2001		2,066,717		200,833		-		-			-			200,833
Issuance for cash, 2002		10,703,678		1,040,129		-		-			-			1,040,129
Net loss		-		-		-		-			(1,182,273	)		(1,182,273	)
BALANCE, DECEMBER 31, 2002		12,770,395		1,240,962		-		-			(1,182,273	)		58,689
Issuance for cash, 2003		4,846,930		471,000		-		-			-			471,000
Net loss		-		-		-		-			(1,608,882	)		(1,608,882	)
BALANCE, DECEMBER 31, 2003		17,617,325		1,711,962		-		-			(2,791,155	)		(1,079,193	)
Net loss		-		-		-		-			(1,058,911	)		(1,058,911	)
BALANCE, DECEMBER 31, 2004		17,617,325		1,711,962		-		-			(3,850,066	)		(2,138,104	)
Issuance for cash, March 2005		360,175		35,000		-		-			-			35,000
Issuance for cash, April 2005		22,500		45,000		-		-			-			45,000
Stock options issued, May 2005		-		-		63,790		-			-			63,790
Stock options issued, August 2005		-		-		39,869		-			-			39,869
Issuance for consideration of loan, October 2005		100,000		110,000		-		-			-			110,000
Conversion of notes payable, November 2005		998,635		1,138,029		-		-			-			1,138,029
Warrants issued in connection with    notes payable , November 2005		-		-		85,734		-			-			85,734
Stock options issued, November 2005		-		-		19,081		(15,901	)		-			3,180
Recapitalization of common equity, note 5		1,615,000		-		-		-			-			-
Issuance for cash, November 2005		135,908		149,500		-		-			-			149,500
Issuance for cash, December 2005		43,181		47,500		-		-			-			47,500
Net loss		-		-		-		-			(1,668,498	)		(1,668,498	)
BALANCE, DECEMBER 31, 2005		20,892,724		3,236,991		208,474		(15,901	)		(5,518,564	)		(2,089,000	)

Prepared without audit.

See notes to financial statements.

7

CARDIFF INTERNATIONAL, INC. dba LEGACY CARD COMPANY

(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF SHAREHOLDERS’ EQUITY

THREE MONTHS ENDED MARCH 31, 2006 AND 2005 AND THE PERIOD

AUGUST 29, 2001 (DATE OF INCEPTION) THROUGH MARCH 31, 2006

					Additional
	Common Stock				Paid in		Deferred			Accumulated
	Shares		Amount		Capital		Compensation			Deficit			Total
Issuance for cash, January 2006		183,634		202,000		-		-			-			202,000
Issuance for cash, February 2006		70,000		77,000		-		-			-			77,000
Issuance for cash, March 2006		265,545		268,100		-		-			-			268,100
Compensation costs recognized, January 2006 - March 2006		-		-		-		4,770			-			4,770
Net loss		-		-		-		-			(456,552	)		(456,552	)
		21,411,903	$	3,784,091	$	208,474	$	(11,131	)	$	(5,975,116	)	$	(1,993,682	)

Prepared without audit.

See notes to financial statements.

8

CARDIFF INTERNATIONAL, INC. dba LEGACY CARD COMPANY

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

MARCH 31, 2006

1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization and Nature of Operations

Legacy Card Company was formed as a Limited Liability Company on August 29, 2001. On April 18, 2005, the Company converted from a California Limited Liability Company to a Nevada Corporation. On November 10, 2005, the Company merged with Cardiff International, Inc. (“Cardiff”), a publicly held corporation. The purpose of the Company is to develop a co-marketing agreement with a premier national bank to offer an integrated financial program to consumers. Legacy Card Company, LLC is a credit card marketing company. The Company offers a new credit card that takes advantage of Internal Revenue Code Section 529 educational savings tax-reform legislation, providing significant tax-free savings and economic incentives for families to save early and often for college tuition and related expenses. The Company will derive its revenues from new credit card one-time account fees, new mutual (ESA) one-time account fees, credit card dollar purchase fees, any negotiated mutual fund (ESA) annual account management fees and any negotiated credit card annual renewal fees. The Company expects to commence the launch of their credit card in a test market in Spring 2006.

Basis of Presentation

The accompanying unaudited financial statements of Cardiff International, Inc. have been prepared pursuant to the rules of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to such rules and regulations. These unaudited financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-KSB for the year ended December 31, 2005. In the opinion of management, the accompanying unaudited financial statements reflect all adjustments, which are of a normal recurring nature, necessary for a fair presentation of the results for the periods presented.

The results of operations presented for the three months ended March 31, 2006 are not necessarily indicative of the results to be expected for any other interim period or any future fiscal year.

Development Stage Activities

The Company is focusing its efforts in two areas during the development stage. First, the Company is devoting substantial time to the development of the credit card technology software, which will be used to capture information at the credit card transaction level. Second, the Company is working to contract with merchants to participate in the program and add incentives for consumers to both use the credit card and make purchases from these merchants.

Prepared without audit.

9

CARDIFF INTERNATIONAL, INC. dba LEGACY CARD COMPANY

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

MARCH 31, 2006

1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Going Concern

The Company has sustained operating losses since its inception and has negative working capital and an accumulated deficit. The accompanying financial statements have been prepared on a going concern basis of accounting, which contemplates continuity of operations, realization of assets and liabilities and commitments in the normal course of business. The accompanying financial statements do not reflect any adjustments that might result if the Company is unable to continue as a going concern. The ability of the Company to continue as a going concern and appropriateness of using the going concern basis is dependent upon, among other things, additional cash infusions. Management has prospective investors, and believes the raising of capital will allow the Company to pursue the development of its credit card business.

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of three (3) months or less to be cash equivalents.

Property and Equipment

Property and equipment are carried at cost. Expenditures for major renewals and betterments that extend the useful lives of property and equipment are capitalized. Expenditures for maintenance and repairs are charged to expense as incurred. Depreciation and amortization of property and equipment is provided using the straight-line method for financial reporting purposes at rates based on the following estimated useful lives:

	Years
Artwork	7
Computer equipment	3
Domain and software	3
Furniture and fixtures	5
Office equipment	5
Leasehold improvements	life of lease

During the three months ended March 31, 2006 and 2005 and for the period August 29, 2001 (date of inception) through March 31, 2006, depreciation expense was $5,725, $4,989 and $110,553 respectively.

Advertising Costs

Advertising costs are charged to expense when incurred. During the three months ended March 31, 2006 and 2005 and for the period August 29, 2001 (date of inception) through March 31, 2006, the amount charged to expense was $0, $0 and $363,800, respectively.

Prepared without audit.

10

CARDIFF INTERNATIONAL, INC. dba LEGACY CARD COMPANY

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

MARCH 31, 2006

1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Research and Development

Research and development costs are charged to expense when incurred. These costs primarily include the costs associated with the development of the credit card software technology. During the three months ended March 31, 2006 and 2005 and for the period August 29, 2001 (date of inception) through March 31, 2006, the amount charged to expense was $0, $0 and $210,810, respectively.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Management uses its historical records and knowledge of its business in making these estimates. Accordingly, actual results could differ from those estimates.

Income Taxes

The Company was treated as a partnership for federal income tax purposes up to April 18, 2005, when it converted to a Nevada Corporation. Consequently, federal income taxes were not payable by, or provided for, the Company. Members were taxed individually on their shares of the Company’s earnings. The Company’s net income or loss was allocated among the members in accordance with the regulations of the Company.

Earnings (Loss) per Share

Earnings (loss) per share is computed using the weighted average number of common shares outstanding during the periods presented. Warrants and options to purchase shares of the Company’s stock may have a dilutive effect on the Company’s earnings per share in the future, but are not included in the calculation for the three months ended March 31, 2006 and 2005 because they have an antidilutive effect in those periods.

Stock options

The Company accounts for its stock options under SFAS No. 123(R).

2.RELATED PARTY TRANSACTIONS

Advances from Shareholders

The Company borrowed funds from Daniel Thompson and Gary Teel, both are Shareholders and Officers of the Company. The terms of repayment stipulate the loans are due twenty-four (24) months after the launch of the Legacy Tuition Card at an annual interest rate of six (6) percent. The balance due to both Daniel Thompson and Gary Teel at March 31, 2006, including accrued interest, is as follows:

Prepared without audit.

11

CARDIFF INTERNATIONAL, INC. dba LEGACY CARD COMPANY

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

MARCH 31, 2006

2.RELATED PARTY TRANSACTIONS (Continued)

	March 31, 2006
Daniel Thompson	$145,994
Gary Teel	$145,993
Total	$291,987

Currently, the Company uses an office provided by one of the officers and no rent is charged to the Company.

Employment Agreements

The employment agreements that both Daniel Thompson and Gary Teel have with the Company provides for their compensation to be $25,000 each, per month. Both Daniel Thompson and Gary Teel have waived their right to receive any unpaid balances.

3.NOTES PAYABLE, ESCROW DEPOSIT & LOAN FEES

Legacy Investors, LLC

On August 5, 2004, the Company entered into a loan agreement with Legacy Investors, LLC, a Florida limited liability company. The initial loan amount of $1,000,000 (the “Initial Loan Amount”) was made by Legacy Investors, LLC upon the satisfaction of the post-closing covenant, comprising of a convertible debenture in the amount of $500,000 and an initial debenture for the amount of $500,000. Lenders required funds to be deposited into an escrow account. Disbursements were required to be from an escrow agent.

The convertible debenture in the amount of $500,000 bears an interest rate of 10.00% per year and matures in August 2006, when the principal and accrued interest is due and payable in full. The indebtedness was convertible into Series A Preferred Membership interests of the Company.

The initial debenture in the amount of $500,000 bears an interest rate of 10.00% per year. Principal payments shall be payable in thirty-six (36) consecutive monthly installments, commencing August 2004, and are payable out of the distributable net cash of the Company.

Under an event of default, the interest rate on both debentures increases to 18% and the terms of repayment and the maturity dates are subject to change. Although Legacy Investors, LLC has raised an issue that the loan might be in default, management does not believe they are in breach of the terms of the agreement, and therefore no additional liability has been recorded relating to a higher interest rate.

Prepared without audit.

12

CARDIFF INTERNATIONAL, INC. dba LEGACY CARD COMPANY

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

MARCH 31, 2006

3.NOTES PAYABLE, ESCROW DEPOSIT & LOAN FEES (Continued)

Legacy Investors, LLC (Continued)

The Company entered into a security agreement stating that the assets of the Company as well as the stock pledges are collateral on this loan.

As of December 31, 2004, the Company received $451,428 of these funds, assumed $106,572 of fees and the balance of $442,000 was deposited in an escrow account. The balance remaining in the escrow account at March 31, 2006 was $0. In May 2005, $382,000 was paid back to Legacy Investors, LLC and $60,000 of fees was left with the escrow agent. Management believes this $60,000 was not owed to the escrow agent, but nevertheless excluded the $60,000 from its assets. The balance on the note payable was $618,000 at March 31, 2006.

The loan fees related to the portion of loan funds that were not received by the Company as of March 31, 2006, were expensed during the year, leaving an amortized balance of loan fees of $9,375.

Corporate Capital Management, LLC and VentureBanc, Inc.

On March 28, 2005, the Company entered into a loan agreement of approximately $1,000,000 with Corporate Capital Management, LLC and VentureBanc, Inc. Simultaneously with the merger with Cardiff International, Inc. (See Note 5), Corporate Capital Management, LLC and VentureBanc, Inc. agreed to loan an additional $875,000 to the Company. These notes bear interest at 8% per annum and the term of the notes is six months after receipt of the loan. At the date of the merger, the balance outstanding of $1,027,296 (including accrued interest) converted into 898,635 shares of common stock of the Company at the rate of $1.10 per share. In addition, the holders of the notes received warrants to purchase 50% of the shares into which the notes are convertible. The term of the warrants is 5 years and the exercise price is $1.75 per share. The value of the warrants, established at $85,734 under the Black Scholes method was expensed in 2005.

Convertible Promissory Note

On October 19, 2005, the Company entered into a loan agreement in the amount of $110,000 with an unaffiliated third-party. The loan bears interest at 8% per annum and matures on April 16, 2006, 6 months after the date of issuance. At the date of the merger, the balance outstanding of $110,733 (including accrued interest) converted into 100,000 shares of common stock of the Company at the rate of $1.10 per share.

Maricopa Equity Management Corporation

On October 27, 2005, the Company entered into a loan agreement in the amount of $100,000 with Maricopa Equity Management Corporation. The loan bears interest at 8% per annum and became due at the closing of the merger with Cardiff International, Inc. As of March 31, 2006, the balance of the loan of $100,000 remained outstanding. In connection with their loan, the Company issued 100,000 shares of common stock ($110,000), which was expensed in 2005.

Prepared without audit.

13

CARDIFF INTERNATIONAL, INC. dba LEGACY CARD COMPANY

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

MARCH 31, 2006

4.COMMITMENTS AND CONTINGENCIES

Operating Lease

On February 1, 2003, the Company signed a lease with Red Bull North America, Inc. for office space. The lease commenced February 1, 2003 and was to expire March 31, 2006. The Company vacated the premises in 2004. On April 22, 2003, the Company signed a lease with Pitney Bowes for mailing equipment. This lease commenced April 22, 2003 and expires October 30, 2006. In July 2005, the Company assumed auto leases from the two officers of the Company, of which one expires in December 2006 and the other expires in July 2008. Future minimum rental payments under these leases are:

Year Ended
March 31,
2007	$ 28,951
2008	16,314
2009	5,438
Total	$ 50,703

Rent expense for the three months ended March 31, 2006 and 2005 and for the period August 29, 2001 (date of inception) through March 31, 2006 was $0, $4,934 and $411,586, respectively.

Litigation

On June 2, 2005, the Company went to trial for a complaint filed by a prior officer of the Company, alleging that his employment was not terminated in January 2002, and claiming back wages. On August 9, 2005, the Court issued a ruling and order that found that the officer was entitled to back pay. On April 4, 2006, the Court granted the Company’s motion for a new trial and found that the tentative decision previously rendered was made by a “disqualified judge”. Therefore, any rulings previously made are void and a new trial is expected to take place later this year. At March 31, 2006 and 2005, the Company had $261,958 accrued as a payable to this officer, which does not include interest, should the officer be entitled to interest. The officer also claimed approximately $56,000 for pre judgment interest. The Company does not believe it owes this money and has not accrued this $56,000.

On December 15, 2005, the Company settled a mutual dispute with Sheppard Mullin Richter and Hampton concerning the representation of the Company. In full and final settlement, the Company is released from all sums claimed by Sheppard Mullin Richter and Hampton under the contract and the Company released Sheppard Mullin Richter and Hampton of all claims, which resulted in a gain of $48,812.

From time to time, the Company is also involved in claims and litigations arising during the course of business.

Prepared without audit.

14

CARDIFF INTERNATIONAL, INC. dba LEGACY CARD COMPANY

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

MARCH 31, 2006

5.RECAPITALIZATION

In November 2005, Legacy Card consummated a transaction, pursuant to which Cardiff International, Inc. acquired all the outstanding shares of Legacy Card, with Legacy Card surviving as a wholly-owned subsidiary of Cardiff International. Legacy Card recorded this transaction as a recapitalization followed by the issuance of shares to the shareholders of Cardiff International. Prior to the recapitalization transaction, Cardiff International was not an operating company, and had no assets. Under the terms of the transaction, Cardiff International issued 18,000,000 shares of Cardiff International common stock to the former shareholders of Legacy Card in exchange for all the outstanding shares of Legacy Card.

6.INCOME TAXES

The Company has loss carryforwards that it can use to offset a certain amount of taxable income in the future. The loss carryforwards are subject to significant limitations due to change in ownership. The Company is currently analyzing its amount of loss carryforwards, but has recorded a valuation allowance for the entire benefit due to the uncertainty of its realization.

7.STOCK OPTIONS AND WARRANTS

Stock Options

The Company granted stock options to consultants and employees during 2005. These stock options have been valued using the Black Scholes method, with the following assumptions:

Interest rate	4.01	%
Dividend yield	-
Term	5 Years
Expected volatility	30.00	%

The following is a schedule summarizing stock option activity for the three months ended March 31, 2006:

		Weighted-
	Number of	Average
	Options	Exercise Price
Outstanding at January 1, 2006	$ 425,000	$ 1.37
Granted	-	-
Exercised	-	-
Forfeited	-	-
Outstanding at March 31, 2006	$ 425,000	$ 1.37
Exercisable at March 31, 2006	$ 366,667	$ 1.31

Prepared without audit.

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CARDIFF INTERNATIONAL, INC. dba LEGACY CARD COMPANY

(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS

MARCH 31, 2006

7.STOCK OPTIONS AND WARRANTS (Continued)

Stock Options (Continued)

Information about stock options outstanding at March 31, 2006 is summarized below:

		Weighted-
		Average	Weighted-		Weighted-
Exercise	Number	Remaining	Average	Number	Average
Price	Outstanding	Contractual Life	Exercise Price	Exercisable	Exercise Price
$ 1.25	325,000	5 years	$ 1.25	325,000	$ 1.25
$ 1.75	100,000	5 years	$ 1.75	41,667	$ 1.75

Warrants

The Company also issued warrants to purchase shares of common stock in 2005. The following is a summary of the warrants outstanding at March 31, 2006:

Number of Warrants	Exercise Price	Maturity
449,318	$1.75	April-August 2010

Prepared without audit.

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ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Overview

Cardiff International, Inc. (“Cardiff”), acquired Legacy Card Company, Inc. (“Legacy”) in a merger transaction in November 2005. The transaction was accounted for as a reverse merger transaction whereby Legacy, although a subsidiary of Cardiff, was deemed to be the surviving entity for accounting purposes. In January 2006, Cardiff changed its fiscal year end to December 31^st from September 30^th to have the same year end as Legacy.

Legacy is a marketing and sales firm that has developed the Simply Brilliant Tuition Card, a national credit card. Legacy is currently in negotiations with a national bank to be the issuing bank.  Legacy anticipates the credit card will be available to the public commencing in the third or fourth quarter of 2006.  Legacy’s business plan calls for revenue to be generated as customers sign up for the credit card and when purchases are made with the credit card. Legacy has generated no revenues since its inception and has expended considerable funds in developing its business plan and funding its operations to date. Legacy was formed as a limited liability company in August 2001. In April 2005, Legacy was converted into a Nevada corporation.

The auditors’ report for the years ended December 31, 2005 and 2004 include a going concern qualification.

Liquidity and Capital Resources

At March 31, 2006

Since inception, the principal sources of cash have been funds raised from the sale of common stock, advances from shareholders, and loans in the form of debentures and convertible notes. At March 31, 2006, we had cash of $22,001. At December 31, 2005 we had no cash or cash equivalents, and total assets amounted to $53,248, which included fixed assets and other assets.

Net cash used in operating activities was $333,223 and $38,258 for the three months ended March 31, 2006 and March 31, 2005, respectively. The increase in the amount of net cash used in operating activities during these quarters was attributable to increased compensation expense, professional fees and other operating costs.

Net cash provided by financing activities was $355,224 and $45,175 for the three months ended March 31, 2006 and March 31, 2005, respectively. The cash flows from financing activities in the three months ended March 31, 2006 were attributable to proceeds from the sale of common stock of $547,100 from unaffiliated third parties. We repaid $190,076 of shareholder advances during the three months ended March 31, 2006.

We have incurred operating losses since its inception and at March 31, 2006, we had an accumulated deficit of $5,975,116.

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Current liabilities at March 31, 2006 consisted primarily of accounts payable of $927,573, amounts due to shareholders of $291,987, convertible and non-convertible promissory notes in the amount of $718,000, and accrued interest in the amount of $120,633. Current liabilities at December 31, 2005 consisted primarily of accounts payable of $841,522, amounts due to shareholders of $453,135, convertible and non-convertible promissory notes in the amount of $718,000, and accrued interest in the amount of $103,183.

Gary R. Teel and Daniel Thompson, the officers and directors of the Company, have entered into employment agreements calling for a monthly salary of $25,000 ($300,000 annually); however, both have waived their unpaid salaries. This waiver of salary not only reduced our operating expenses and loss, it reduced the amount of capital needed to fund our operations. During the three months March 31, 2006, we repaid $101,290 to Mr. Teel and $88,786 to Mr. Thompson on outstanding loans.

There can be no assurance that we will be able to obtain sufficient capital from debt or equity transactions or from operations in the necessary time frame or on terms acceptable to us. Should we be unable to raise sufficient funds, we may be required to curtail our operating plans and possibly relinquish rights to portions of our technology or products. In addition, increases in expenses or delays in product development may adversely impact our cash position and may require cost reductions. No assurance can be given that we will be able to operate profitably on a consistent basis, or at all, in the future.

In order to continue our operations, development of our products, and implementation of our business plan, we need additional financing. During the first quarter of 2006 we raised $547,100 from the sale of 519,179 shares of our common stock and $24,608 from shareholder advances. We are also attempting to obtain additional working capital in a term loan transaction. Additionally, we anticipate that our credit card will be launched in the second quarter of 2006 thereby commencing the generation of revenue shortly thereafter. In addition, we also anticipate that we will continue to operate at a loss for the foreseeable future. There can be no assurance that we will be successful in obtaining financing or in our efforts to increase revenues and decrease operating costs. If we are unable to obtain additional financing, we may be required to reduce operations, reduce or discontinue further research and development, and/or reduce or eliminate further acquisition activities.

Results of Operations

For the Quarters Ended March 31, 2006 and 2005

We had no operating revenues for the three months ended March 31, 2006 or March 31, 2005.

We had operating expenses of $433,886 for the three months ended March 31, 2006 and $48,872 for the three months ended March 31, 2005, representing an increase of $385,014. The increase in operating expenses was primarily due to increases in legal fees, salaries and wages consulting fees, and travel and entertainment costs.

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We had a net loss of $456,552, for the three months ended March 31, 2006 compared to a net loss of $73,872 for the three months ended March 31, 2005, representing an increase of $382,680.

Inflation

We do not believe that inflation will negatively impact our business plans.

Plan of Operation

Our current business plan is described in “Item 1 - Description of Business” of Form 10-KSB for the year ended December 31, 2005.

Critical Accounting Policies

This Management’s Discussion and Analysis of Financial Condition and Results of Operations discuss the Company’s Financial Statements, which have been prepared in accordance with accounting principles generally accepted in the United States.

We have not yet commenced active operations. The preparation of our financial statements requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management evaluates its estimates and assumptions. We anticipate that management will base its estimates and judgments on historical experience of the operations we may acquire and on various other factors that are believed to be 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.

Management believes the following critical accounting policies, among others, will affect its more significant judgments and estimates used in the preparation of our Consolidated Financial Statements:

We utilize the fair value based method of accounting for stock-based compensation, in accordance with Statement of Financial Accounting Standards No. 123(R).

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Recent Accounting Pronouncements

In February 2006, the FASB issued Statement of Financial Accounting Standards No. 155, "Accounting for Certain Hybrid Financial Instruments" ("SFAS 155"), which amends SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities" ("SFAS 133") and SFAS No. 140, "Accounting for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities" ("SFAS 140"). SFAS 155 amends SFAS 133 to narrow the scope exception for interest-only and principal-only strips on debt instruments to include only such strips representing rights to receive a specified portion of the contractual interest or principle cash flows. SFAS 155 also amends SFAS 140 to allow qualifying special-purpose entities to hold a passive derivative financial instrument pertaining to beneficial interests that itself is a derivative instruments. The Company believes that this new standard will not have a material impact on the Company's financial position, results of operations or cash flows.

Forward Outlook and Risks

This Form 10-QSB and our Form 10-KSB for the year ended December 31, 2005 contain and incorporates by reference certain “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act with respect to results of our operations and businesses. All statements, other than statements of historical facts, included in this Form 10-KSB, including those regarding market trends, our financial position, business strategy, projected costs, and plans and objectives of management for future operations, are forward-looking statements. In general, such statements are identified by the use of forward- looking words or phrases including, but not limited to, “intended,” “will,” “should,” “may,” “expects,” “expected,” “anticipates,” and “anticipated” or the negative thereof or variations thereon or similar terminology. These forward-looking statements are based on our current expectations. Although we believe that the expectations reflected in such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. Because forward-looking statements involve risks and uncertainties, our actual results could differ materially. Important factors that could cause actual results to differ materially from our expectations are disclosed hereunder and elsewhere in this Form 10-QSB. These forward-looking statements represent our judgment as of the date of this Form 10-QSB. All subsequent written and oral forward-looking statements attributable to Cardiff are expressly qualified in their entirety by the Cautionary Statements. We disclaim, however, any intent or obligation to update our forward-looking statements.

Operating History. We have not commenced active business operations. We anticipate we will commence active operations during the second quarter of 2006. Potential investors should be aware that there is only a limited basis upon which to evaluate our prospects for achieving our intended business objectives. We have limited resources and have had no revenues since our formation.

Possibility of Total Loss of Investment. An investment in Cardiff is an extremely high risk investment, and should not be made unless the investor has no need for current income from the invested funds and unless the investor can afford a total loss of his or her investment.

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Additional Financing Requirements. We will likely be required to seek additional financing in order to fund our operations and carry out our business plan. In order to fund our operations and effect additional acquisitions, we will be required to obtain additional capital. There can be no assurance that such financing will be available on acceptable terms, or at all. We do not have any arrangements with any bank or financial institution to secure additional financing and there can be no assurance that any such arrangement, if required or otherwise sought, would be available on terms deemed to be commercially acceptable and in our best interest.

No Public Market for Securities. There is no active public market for our common stock and we can give no assurance that an active market will develop, or if developed, that it will be sustained.

Auditor’s Opinion has a Going Concern Qualification. Our auditor’s report dated March 24, 2006 for the years ended December 31, 2005 and 2004 and for the period from inception through December 31, 2005 includes a going concern qualification which states that our significant recurring operating losses and negative working capital raise substantial doubt about our ability to continue as a going concern.

We do not anticipate paying any dividends and any gains from your investment in our stock will have to come from increases in the price of such stock.We currently intend to retain any future earnings for use in our business and do not anticipate paying any cash dividends in the foreseeable future.

We Operate in a Competitive Market. The credit card industry is competitive and new offerings and technologies are becoming available regularly. We cannot guarantee that we will compete successfully against our potential competitors, especially those with significantly greater financial resources or brand name recognition.

ITEM 3. CONTROLS AND PROCEDURES

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

(a) Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of March 31, 2006 (as defined in Rule 13a-15(e) or 15d-15(e) under the Securities Exchange Act of 1934 (the "Exchange Act")). In connection with this evaluation, management identified a deficiency that existed in the design or operation of our internal control over financial reporting that it considers to be a “material weaknesses.” The Public Company Accounting Oversight Board has defined a material weakness as a “significant deficiency or combination of significant deficiencies that results in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected.”

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The deficiency in our internal control related to accounting for the debt discount resulting from the warrants issued in connection with the convertible notes and the related beneficial conversion feature. The adjustment to record the debt discount and beneficial conversion feature was detected and has been appropriately recorded and disclosed in this Form 10-QSB. We are in the process of improving our internal control over financial reporting in an effort to remediate this deficiency.

Based upon that evaluation and the deficiency identified above, the Chief Executive Officer and Chief Financial Officer concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were not effective in timely alerting them to the material information relating to us (or our consolidated subsidiaries) required to be included in the reports we file or submit under the Exchange Act.

(b)Changes in Internal Controls

There were no significant changes in the Company's internal controls over financial reporting or in other factors that could significantly affect these internal controls subsequent to the date of their most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

PART II - OTHER INFORMATION

Item 1.Legal Proceedings. On June 2, 2005, the Company went to trial for a complaint filed by a prior officer of the Company, alleging that his employment was not terminated in January 2002, and claiming back wages. In August 2005, the Court issued a ruling and order that found that the officer was entitled to back pay. At March 31, 2006 and 2005, the Company had $261,958 accrued as a payable to this officer, which does not include interest, should the officer be entitled to interest. The officer also claimed approximately $56,000 for pre judgment interest. The Company does not believe it owes this money and has not accrued this $56,000. On April 4, 2006 the court found that a disqualified judge rendered the decision made and therefore the judgment is vacated as to all defendants and all rulings from August 2005 are void. The prior officer has until November 2006 to request a new trial against Cardiff International, Inc.

Item 2.Unregistered Sales of Equity Securities. During the quarter ended March 31, 2006 we issued 519,179 shares of our common stock un registered transactions. All of such shares were issued in reliance on Section 4(1) of the Securities Act of 1933, as amended, as shares issued in a non-public transaction. Such shares were issued to the following:

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Name	Date	Number of Shares	Price
Glenn Solie	01/03/06	8,181	$9,000.00
Eric J. Vogstrom	01/04/06	8,181	$9,000.00
Greg Bertagnoli	01/04/06	12,272	$13,500.00
Rod and Sandra Merry	01/04/06	20,000	$22,000.00
The Escalera Living Trust	01/06/06	50,000	$55,000.00
Dick Jones	01/18/06	25,000	$27,500.00
W & R Inc. - Steve King	01/18/06	10,000	$11,000.00
John S. & Robin G. Cone	01/24/06	50,000	$55,000.00
Patrick Doherty	02/10/06	10,000	$11,000.00
The Cole Trust	02/17/06	50,000	$55,000.00
David L. Raber	02/22/06	10,000	$11,000.00
Steven Posner	03/01/06	200,000	$200,000.00
Dennis & Cynthia Kingery	03/07/06	14,545	$15,999.50
Thomas A. & Jane L. Brust	03/17/06	11,000	$12,100.00
Howard Jacobson	03/30/06	20,000	$20,000.00
Mitchell Block	03/30/06	20,000	$20,000.00

Item 3.Defaults by the Company on its Senior Securities. None

Item 4.Submission of Matters to Vote of Security Holders. None

Item 5.Other Information.

Item 6. Exhibits.	31.1 Certification by the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	31.2 Certification by the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1 Certification by the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2 Certification by the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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SIGNATURE

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

Dated: June 23, 2006	CARDIFF INTERNATIONAL, INC.
	By/s/ Daniel Thompson
	Chief Executive Officer, President
	By/s/ Gary R. Teel
	Chief Financial Officer/ Secretary/Chairman

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