Quarterly report pursuant to Section 13 or 15(d)

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

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CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $)
 6 Months Ended 51 Months Ended
Dec. 31, 2011
Dec. 31, 2010
Dec. 31, 2011
CASH FLOWS FROM OPERATING ACTIVITIES      
Net loss $ (5,782,033) $ (1,041,034) $ (9,628,373)
Adjustments to reconcile net loss to net cash used in operating activities:      
Issuances of common stock for services 0 341,349 290,733
Amortization of prepaid shares issued for services 5,640,097 0 6,285,204
Officer shares contributed to third party consultant 0 0 299,737
Depreciation expense 973 744 9,330
Changes in operating assets and liabilities:      
Accounts receivable 0 0 (664)
GST receivable (2,035) 5,349 (1,673)
Other assets (7,632) (459,354) (7,097)
Accounts payable 49,951 (37,442) 69,751
Employee benefit liability 3,272 8,175 33,358
Accrued expenses 56,453 (39,425) 72,412
Accrued interest 797 0 184,614
Net cash used in operating activities (40,157) (1,221,638) (2,392,668)
CASH FLOWS FROM INVESTING ACTIVITIES      
Patent costs 0 (22,882) (25,726)
Purchase of equipment 0 (3,349) (14,786)
Net cash used in investing activities 0 (26,231) (40,512)
CASH FLOWS FROM FINANCING ACTIVITIES      
Sale of common stock 10,321 1,283,130 1,461,971
Contributed capital 0 0 495,665
Subscriptions receivable – related party 0 0 22
Related party expenses paid on behalf of company 0 0 57,262
Loan repayments of principal stockholder 0 (14,172) (14,834)
Investor advances 0 0 79,112
Proceeds from convertible promissory notes 70,009 0 70,009
Loan proceeds from principal stockholder 0 0 369,174
Net cash provided by financing activities 80,330 1,268,958 2,518,381
Effect of exchange rate changes on cash (577) 23,057 (45,473)
NET INCREASE IN CASH 39,596 44,146 39,728
CASH AT BEGINNING OF PERIOD 132 528  
CASH AT END OF PERIOD 39,728 44,674 39,728
Supplemental Disclosure of cash flow information      
Interest 0 0 0
Income Tax 0 0 0
Supplemental disclosure of non-cash investing and financing activities:      
Conversion of notes payable to common stock 0 0 341,208
Conversion of accrued interest to common stock 0 0 193,648
Gain on related party debt conversion 0 0 9,252
Prepaid common stock issued for services 0 0 10,823,048
Advance from Investor – related party, reclassified to common stock 80,000 0 80,000
Conversion of accrued expenses to common stock $ 36,272 $ 0 $ 36,272