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 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 [_] Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B is not contained in this form, and no disclosure will be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or any amendment to this Form 10-KSB. [_] Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act): ` Yes [_] No [X] State issuer's revenues for its most recent fiscal year ended March 31, 2008: $0.00 Of the 7,755,000 shares of voting stock of the registrant issued and outstanding as of March 31, 2008, 5,250,000 shares were held by non-affiliates. The aggregate market value of the voting stock held by non-affiliates of the registrant computed by reference to the closing bid price of its Common Stock as reported on the OTC Bulletin Board on July 9, 2008: US $6,562,500. Transitional Small Business Disclosure Format (check one): Yes [_] No [X] CAUTION REGARDING FORWARD-LOOKING INFORMATION This Annual Report on Form 10-KSB and the information incorporated by reference includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended. Various statements, estimates, predictions, and projections stated under "Risk Factors," "Management's Discussion and Analysis or Plan of Operations" and "Business," and elsewhere in this Annual Report are "forward-looking statements" within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. These statements appear in a number of places in this Annual Report and include statements regarding the intent, belief or current expectations of Madison Explorations, Inc. or our officers with respect to, among other things, the ability to successfully implement our exploration strategies, including trends affecting our business, financial condition and results of operations. While these forward-looking statements and the related assumptions are made in good faith and reflect our current judgment regarding the direction of the related business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions, or other future performance suggested herein. These statements are based upon a number of assumptions and estimates, which are inherently subject to significant uncertainties and contingencies, many of which are beyond our control and reflect future business decisions which are subject to change. Some of these assumptions inevitably will not materialize, and unanticipated events will occur which will affect our results. Some important factors (but not necessarily all factors) that could affect our revenues, growth strategies, future profitability and operating results, or that otherwise could cause actual results to differ materially from those expressed in or implied by any forward-looking statement, include the following: - our ability to successfully implement our exploration strategies; - the success or failure of our exploration activities and other opportunities that we may pursue; - changes in the availability of debt or equity capital and increases in borrowing costs or interest rates; - changes in regional and national business and economic conditions, including the rate of inflation; - changes in the laws and government regulations applicable to us; and increased competition. Stockholders and other users of this Annual Report on Form 10-KSB are urged to carefully consider these factors in connection with the forward-looking statements. We do not intend to publicly release any revisions to any forward-looking statements contained herein to reflect events or circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. ZANDARIA VENTURES, INC. TABLE OF CONTENTS Page Number PART I ITEM 1 DESCRIPTION OF BUSINESS 5 ITEM 2 DESCRIPTION OF PROPERTY 10 ITEM 3 LEGAL PROCEEDINGS 10 ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS 10 PART II ITEM 5 MARKET FOR COMPANY'S COMMON STOCK AND RELATED STOCKHOLDERS MATTERS 10 ITEM 6 MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION 12 ITEM 7 FINANCIAL STATEMENTS 14 ITEM 8 CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURES 14 ITEM 8A CONTROLS AND PROCEDURES 14 PART III ITEM 9 DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT 14 ITEM 10 EXECUTIVE COMPENSATION 16 ITEM 11 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS 17 ITEM 12 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS 18 ITEM 13 EXHIBITS AND REPORTS ON 8-K 18 ITEM 14 PRINCIPAL ACCOUNTANT FEES AND SERVICES 18 FINANCIALS F-1 SIGNATURES 31 PART I ITEM 1 - Description of Business We were incorporated on February 23, 2005 under the laws of the state of Nevada. On that date, Steven Cozine was appointed as our sole director. Mr. Cozine was also appointed as our president, secretary, treasurer and chief executive officer. The Company is a start-up, developmental stage company and has not yet generated or realized any revenues from business operations. The Company's business strategy focused on Chip claim exploration in Canada. In 2007 the Company decided to exit this business plan and seek a different plan that would require less start-up capital to develop. The Company's auditors have issued a going concern opinion in our audited financial statements for the fiscal year ended March 31, 2008. This means that our auditors believe there is doubt that the Company can continue as an on-going business for the next twelve months unless it obtains additional capital to pay its bills. This is because the Company has not generated any revenues and no revenues are anticipated until it begins the exploration plans on the Chip claims. Accordingly, we must raise cash from sources such as investments by others in the Company and through possible transactions with strategic or joint venture partners. In the event we raise cash, we will likely use such funds to develop a new business plan, which is as yet undetermined. We do not plan to use any capital raised for the purchase or sale of any plant or significant equipment. The following discussion and analysis should be read in conjunction with the financial statements of the Company and the accompanying notes appearing subsequently under the caption "Financial Statements". Employees We have no employees as of the date of this filing other than our sole director. Currency Fluctuation The Company's currency fluctuation exposure is primarily to the Canadian dollar as all of the Company's properties are in British Columbia. Such fluctuations may materially affect the Company's financial position and results of operations. Subsidiaries We do not have any subsidiaries. Patents and Trademarks We do not own, either legally or beneficially, any patents or trademarks. Reports to Security Holders The Company does not intend to deliver an annual report to its security holders. The public may read and copy any materials filed with the SEC, such as this Form 10-KSB and Form 10-QSB reports. The Company is an electronic filer under the SEC's EDGAR filing program. Accordingly, the Company's filings are maintained by the SEC in a database at www.sec.gov and are available to all security holders. 5 Risk Factors An investment in an exploration stage mining company with no history of operations such as ours involves an unusually high amount of risk, both unknown and known, and present and potential, including, but not limited to the risks enumerated below. Risks Associated with Mining ALL OF OUR PROPERTIES ARE IN THE EXPLORATION STAGE. THERE IS NO ASSURANCE THAT WE CAN ESTABLISH THE EXISTENCE OF ANY MINERAL RESOURCE ON ANY OF OUR PROPERTIES IN COMMERCIALLY EXPLOITABLE QUANTITIES. UNTIL WE CAN DO SO, WE CANNOT EARN ANY REVENUES AND IF WE DO NOT DO SO WE WILL LOSE ALL OF THE FUNDS THAT WE EXPEND ON EXPLORATION. IF WE DO NOT DISCOVER ANY MINERAL RESOURCE IN A COMMERCIALLY EXPLOITABLE QUANTITY, OUR BUSINESS WILL FAIL. Despite limited exploration work on our mineral properties, we have not established that any of them contain any mineral reserve, nor can there be any assurance that we will be able to do so. If we do not, our business will fail. A mineral reserve is defined by the Securities and Exchange Commission in its Industry Guide 7 (http://www.sec.gov/divisions/corpfin/forms/industry.htm#sec guide7) as that part of a mineral deposit, which could be economically and legally extracted or produced at the time of the reserve determination. The probability of an individual prospect ever having a "reserve" that meets the requirements of the Securities and Exchange Commission's Industry Guide 7 is extremely remote; in all probability our mineral resource property does not contain any 'reserve' and any funds that we spend on exploration will probably be lost. Even if we do eventually discover a mineral reserve on one or more of our properties, there can be no assurance that they can be developed into producing mines and extract those resources. Both mineral exploration and development involve a high degree of risk and few properties, which are explored, are ultimately developed into producing mines. The commercial viability of an established mineral deposit will depend on a number of factors including, by way of example, the size, grade and other attributes of the mineral deposit, the proximity of the resource to infrastructure, government regulation and market prices. Most of these factors will be beyond our control, and any of them could increase costs and make extraction of any identified mineral resource unprofitable. MINERAL OPERATIONS ARE SUBJECT TO APPLICABLE LAW AND GOVERNMENT REGULATION. EVEN IF WE DISCOVER A MINERAL RESOURCE IN A COMMERCIALLY EXPLOITABLE QUANTITY, THESE LAWS AND REGULATIONS COULD RESTRICT OR PROHIBIT THE EXPLOITATION OF THAT MINERAL RESOURCE. IF WE CANNOT EXPLOIT ANY MINERAL RESOURCE THAT WE MIGHT DISCOVER ON OUR PROPERTIES, OUR BUSINESS MAY FAIL. Both mineral exploration and extraction require permits from various federal, provincial and local governmental authorities and are governed by laws and regulations, including those with respect to prospecting, mine development, mineral production, transport, export, taxation, labor standards, occupational health, waste disposal, toxic substances, land use, environmental protection, mine safety and other matters. There can be no assurance that we will be able to obtain or maintain any of the permits required for the continued exploration of our mineral properties or for the construction and operation of a mine on our properties at economically viable costs. If we cannot accomplish these objectives, our business could fail. 6 We believe that we are in compliance with all material laws and regulations that currently apply to our activities but there can be no assurance that we can continue to do so. Current laws and regulations could be amended and we might not be able to comply with them, as amended. Further, there can be no assurance that we will be able to obtain or maintain all permits necessary for our future operations, or that we will be able to obtain them on reasonable terms. To the extent such approvals are required and are not obtained, we may be delayed or prohibited from proceeding with planned exploration or development of our mineral properties. IF WE ESTABLISH THE EXISTENCE OF A MINERAL RESOURCE ON ANY OF OUR PROPERTIES IN A COMMERCIALLY EXPLOITABLE QUANTITY, WE WILL REQUIRE ADDITIONAL CAPITAL IN ORDER TO DEVELOP THE PROPERTY INTO A PRODUCING MINE. IF WE CANNOT RAISE THIS ADDITIONAL CAPITAL, WE WILL NOT BE ABLE TO EXPLOIT THE RESOURCE, AND OUR BUSINESS COULD FAIL. If we do discover mineral resources in commercially exploitable quantities on any of our properties, we will be required to expend substantial sums of money to establish the extent of the resource, develop processes to extract it and develop extraction and processing facilities and infrastructure. Although we may derive substantial benefits from the discovery of a major deposit, there can be no assurance that such a resource will be large enough to justify commercial operations, nor can there be any assurance that we will be able to raise the funds required for development on a timely basis. If we cannot raise the necessary capital or complete the necessary facilities and infrastructure, our business may fail. MINERAL EXPLORATION AND DEVELOPMENT IS SUBJECT TO EXTRAORDINARY OPERATING RISKS. WE DO NOT CURRENTLY INSURE AGAINST THESE RISKS. IN THE EVENT OF A CAVE-IN OR SIMILAR OCCURRENCE, OUR LIABILITY MAY EXCEED OUR RESOURCES, WHICH WOULD HAVE AN ADVERSE IMPACT ON OUR COMPANY. Mineral exploration, development and production involve many risks, which even a combination of experience, knowledge and careful evaluation may not be able to overcome. Our operations will be subject to all the hazards and risks inherent in the exploration, development and production of resources, including liability for pollution, cave-ins or similar hazards against which we cannot insure or against which we may elect not to insure. Any such event could result in work stoppages and damage to property, including damage to the environment. We do not currently maintain any insurance coverage against these operating hazards. The payment of any liabilities that arise from any such occurrence would have a material, adverse impact on our Company. MINERAL PRICES ARE SUBJECT TO DRAMATIC AND UNPREDICTABLE FLUCTUATIONS. We expect to derive revenues, if any, from the eventual extraction and sale of diamonds as well as precious and base metals such as gold, silver and copper. The price of those commodities has fluctuated widely in recent years, and is affected by numerous factors beyond our control including international, economic and political trends, expectations of inflation, currency exchange fluctuations, interest rates, global or regional consumptive patterns, speculative activities and increased production due to new extraction developments and improved extraction and production methods. The effect of these factors on the price of base and precious metals, and, therefore, the economic viability of any of our exploration projects, cannot accurately be predicted. THE MINING INDUSTRY IS HIGHLY COMPETITIVE AND THERE IS NO ASSURANCE THAT WE WILL CONTINUE TO BE SUCCESSFUL IN ACQUIRING MINERAL CLAIMS. IF WE CANNOT CONTINUE TO ACQUIRE PROPERTIES TO EXPLORE FOR MINERAL RESOURCES, WE MAY BE REQUIRED TO REDUCE OR CEASE OPERATIONS. There are hundreds of public and private companies that are actively engaged in mineral exploration. The exact number is virtually impossible to quantify. Furthermore, since the mineral exploration sphere is so diverse, it is quite difficult to identify specific primary competitors and make comparisons to our Company. 7 Many of our competitors have greater financial resources and technical facilities. Accordingly, we will attempt to compete primarily through the knowledge and experience of our management. This competition could adversely affect our ability to acquire suitable prospects for exploration in the future. Accordingly, there can be no assurance that we will acquire any interest in additional mineral resource properties that might yield reserves or result in commercial mining operations. THIRD PARTIES MAY CHALLENGE OUR RIGHTS TO OUR RESOURCE PROPERTIES OR THE AGREEMENTS THAT PERMIT US TO EXPLORE OUR PROPERTIES MAY EXPIRE IF WE FAIL TO TIMELY RENEW THEM AND PAY THE REQUIRED FEES. In connection with the acquisition of our mineral properties, we sometimes conduct only limited reviews of title and related matters, and obtain certain representations regarding ownership. These limited reviews do not necessarily preclude third parties from challenging our title and, furthermore, our title may be defective. Consequently, there can be no assurance that we hold good and marketable title to all of our mining concessions and mining claims. If any of our concessions or claims were challenged, we could incur significant costs and lose valuable time in defending such a challenge. These costs or an adverse ruling with regards to any challenge of our titles could have a material adverse affect on our financial position or results of operations. There can be no assurance that any such disputes or challenges will be resolved in out favor. We are not aware of challenges to the location or area of any of the mining concessions and mining claims. There is, however, no guarantee that title to the claims and concessions will not be challenged or impugned in the future. Risks Associated with Our Common Stock BECAUSE OUR COMMON STOCK IS TRADED ONLY ON THE OTC BULLETIN BOARD, YOUR ABILITY TO SELL YOUR SHARES IN THE SECONDARY TRADING MARKET MAY BE LIMITED. Currently, our common stock is traded only on the OTC Bulletin Board. Consequently, the liquidity of our common stock is impaired, not only in the number of shares that are bought and sold, but also through delays in the timing of transactions, and coverage by security analysts and the news media, if any, of our Company. As a result, prices for shares of our common stock may be different than might otherwise prevail if our common stock was quoted or traded on a national securities exchange such as the New York Stock Exchange, NASDAQ, or the American Stock Exchange. OUR STOCK PRICE HAS BEEN VOLATILE AND YOUR INVESTMENT IN OUR COMMON STOCK COULD SUFFER A DECLINE IN VALUE. Our common stock is traded only on the OTC Bulletin Board. The market price of our common stock may fluctuate significantly in response to a number of factors, some of which are beyond our control. These factors include price fluctuations of precious metals, government regulations, disputes regarding mining claims, broad stock market fluctuations and economic conditions in the United States. BECAUSE WE DO NOT INTEND TO PAY ANY DIVIDENDS ON OUR COMMON SHARES, INVESTORS SEEKING DIVIDEND INCOME OR LIQUIDITY SHOULD NOT PURCHASE OUR SHARES. We do not currently anticipate declaring and paying dividends to our shareholders in the near future. It is our current intention to apply net earnings, if any, in the foreseeable future to increasing our working capital. Prospective investors seeking or needing dividend income or liquidity should, therefore, not purchase our common stock. We currently have no revenues and a history of losses, so there can be no assurance that we will ever have sufficient earnings to declare and pay dividends to the holders of our shares, and in any event, a decision to declare and pay dividends is at the sole discretion of our board of directors, who currently do not intend to pay any dividends on our common shares for the foreseeable future. 8 OUR STOCK IS A PENNY STOCK. TRADING OF OUR STOCK MAY BE RESTRICTED BY THE SEC'S PENNY STOCK REGULATIONS, WHICH MAY LIMIT A STOCKHOLDER'S ABILITY TO BUY AND SELL OUR STOCK. Our stock is a penny stock. The Securities and Exchange Commission has adopted Rule 15g-9 which generally defines "penny stock" to be any equity security that has a market price (as defined) less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. Our securities are covered by the penny stock rules, which impose additional sales practice requirements on broker-dealers who sell to persons other than established customers and "accredited investors". The term "accredited investor" refers generally to institutions with assets in excess of $5,000,000 or individuals with a net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouse. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document in a form prepared by the SEC, which provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customer's account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer's confirmation. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from these rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for the stock that is subject to these penny stock rules. Consequently, these penny stock rules may affect the ability of broker-dealers to trade our securities. We believe that the penny stock rules discourage investor interest in and limit the marketability of our common stock. NASD SALES PRACTICE REQUIREMENTS MAY ALSO LIMIT A STOCKHOLDER'S ABILITY TO BUY AND SELL OUR STOCK In addition to the "penny stock" rules promulgated by the Securities and Exchange Commission (see above for discussions of penny stock rules), the NASD has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer's financial status, tax status, investment objectives and other information. Under interpretations of these rules, the NASD believes that there is a high probability that speculative low priced securities will not be suitable for at least some customers. The NASD requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit your ability to buy and sell our stock and have an adverse effect on the market for our shares. PLEASE READ THIS FORM 10KSB CAREFULLY. YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED HEREIN AND ON THE OTHER REPORTS AND OUR FORM 10SB, AS AMENDED, THAT WE HAVE FILIED WITH THE SECURITIES AND EXCHANGE COMMISSION. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH DIFFERENT INFORMATION. 9 ITEM 2 - Description of Property The Company's current mailing address is 2300 Palm Beach Lakes Boulevard, Suite 218, West Palm Beach, Florida 33409. The property consists of approximately 1,100 square feet of finished office space. Other than this mailing address, we do not currently maintain any other office facilities. We pay no rent or other fees for the use of the mailing address as these offices are used virtually full-time by other businesses of our shareholder. We believe that the foregoing space is adequate to meet our current needs and anticipate moving our offices during the next twelve months if we are able to execute our business plan. We own the mineral exploration rights relating to the Chip mineral claims. We do not own any real property interest in the Chip claims or any other property. The Chip property consists of three mineral claims comprising a total of 1,106.331 hectares. A "mineral claim" refers to a specific section of land over which a title holder owns rights to explore the ground and subsurface, and extract minerals The following is a table of pertinent data regarding the claims: Claim Name Tenure No. Hectares Expiry Date ---------- ---------- -------- ------------- Chip 1 562902 491.787 July 12, 2008 Chip 2 562900 307.271 July 12, 2008 Chip 3 562901 163.800 July 12, 2008 ITEM 3 - Legal Proceedings The Company is not currently party to any material legal proceedings and to our knowledge, no such proceedings are threatened or contemplated. ITEM 4 - Submission of Matters To a Vote of Security Holders. During the fourth quarter of our fiscal yearend 2008, no matters were submitted to a vote of the security holders of the Company. PART II ITEM 5 - MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS. Market Information There is no established trading market in our Common Stock. The Company's common stock is traded only on the OTC Bulletin Board (OTC: ZDVN). Shareholders As at March 31, 2008 there are approximately thirty five holders of the Company's Common Stock. Shares Eligible for Resale Except for the shares of stock held by our officers and directors, all of our issued and outstanding shares of Common Stock held by non-affiliates are eligible for sale under Rule 144 promulgated under the Securities Act of 1933, as amended, subject to certain limitations included in said Rule. In general, under Rule 144, a person (or persons whose shares are aggregated), who has 10 satisfied a one year holding period, under certain circumstances, may sell within any three-month period a number of shares which does not exceed the greater of one percent of the then outstanding Common Stock or the average weekly trading volume during the four calendar weeks prior to such sale. Rule 144 also permits, under certain circumstances, the sale of shares without any quantity limitation by a person who has satisfied a two-year holding period and who is not, and has not been for the preceding three months, an affiliate of the Company. In summary, Rule 144 applies to affiliates (that is, control persons) and nonaffiliates when they resell restricted securities (those purchased from the Company or an affiliate of the Company in nonpublic transactions). Nonaffiliates reselling restricted securities, as well as affiliates selling restricted or nonrestricted securities, are not considered to be engaged in a distribution and, therefore, are not deemed to be underwriters as defined in Section 2(11), if six conditions are met: (1) Current public information must be available about the Company unless sales are limited to those made by nonaffiliates after two years. (2) When restricted securities are sold, generally there must be a one-year holding period. (3) When either restricted or nonrestricted securities are sold by an affiliate after one year, there are limitations on the amount of securities that may be sold; when restricted securities are sold by non-affiliates between the first and second years, there are identical limitations; after two years, there are no volume limitations for resales by non-affiliates. (4) Except for sales of restricted securities made by nonaffiliates after two years, all sales must be made in brokers' transactions as defined in Section 4(4) of the Securities Act of 1933, as amended, or a transaction directly with a "market maker" as that term is defined in Section 3(a)(38) of the 1934 Act. (5) Except for sales of restricted securities made by nonaffiliates after two years, a notice of proposed sale must be filed for all sales in excess of 500 shares or with an aggregate sales price in excess of $10,000. (6) There must be a bona fide intention to sell within a reasonable time after the filing of the notice referred to in (5) above. Capital Risks We do not currently have sufficient capital to engage in exploration activities. The cost of our planned exploration activities over the next two years is approximately $76,100. As of the date of this filing, we do not have sufficient capital to engage in exploration activities, and no sources for financing. The extent to which we will be able to implement our exploration for minerals will be determined by our ability to engage in offerings of equity securities and/or debt securities. Without additional capital, we will have to either curtail our business plan, or abandon it altogether. We do not have any identified sources of additional capital, the absence of which may prevent us from continuing our operations. We do not, presently, have any arrangements with any investment banking firms or institutional lenders. Because we will need additional capital, we will have to expend significant effort to raise operating funds. These efforts may not be successful. If not, we will have to either curtail our business plan, or abandon it altogether. SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS As at the date of this report there are no securities authorized for issuance under equity compensation plans. 11 ITEM 6 - MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION Overview The Company is a start-up, pre-exploration stage company and has not yet generated or realized any revenues from business operations. The Company's auditors have issued a going concern opinion. This means that its auditors believe there is doubt that the Company can continue as an on-going business for the next twelve months unless it obtains additional capital to pay its bills. This is because the Company has not generated any revenues and no revenues are anticipated until it begins removing and selling minerals. Accordingly, we must raise cash from sources such as investments by others in the Company and through possible transactions with strategic or joint venture partners. In the event we raise cash, we will likely use such funds to meet our obligations pursuant to the Option Agreement, for additional exploration and to employ personnel. We do not plan to use any capital raised for the purchase or sale of any plant or significant equipment. The following discussion and analysis should be read in conjunction with the financial statements of the Company and the accompanying notes appearing subsequently under the caption "Financial Statements." Results of Operations Revenues There is no historical financial information about the Company upon which to base an evaluation of our performance. The Company did not generate any revenues from operations for the twelve months ended March 31, 2008. Accordingly, comparisons with prior periods are not meaningful. The Company is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources, possible delays in the exploration of its properties, and possible cost overruns due to price and cost increases in services. Operating Expenses Operating expenses increased by $1,259 from $21,335 for the year ended March 31, 2007 to $22,594 for the year ended March 31, 2008. The increase in our net operating loss is due to the increase in professional fees. Interest Expense The Company currently has no interest expense. Net Income/Loss Net loss increased $999 from net operating loss of $21,335 for the year ended March 31, 2007 to a net operating loss of $22,344 for the year ended March 31, 2008. The increase in net operating loss is due to the increase in professional fees. As of March 31, 2008, our accumulated deficit was $69,601. Assets and Liabilities Our total assets were $5,123 as of March 31, 2008. Our assets consisted of cash of $4,032 and prepaid expenses of $1,091. Total Current Liabilities as of March 31, 2008 were $51,749. Our notes payable are $9,186 to Steven Cozine, $5,000 to Edward Johnson, and $24,413 to Jason Smart. Derivative liability arising from note conversion rights was $2,625. Plan of Operation The Company's plan of operation for the next twelve months is to focus on developing and implementing a new business plan since we have elected to abandon the Chip claim exploration operations. 12 Financial Condition, Liquidity and Capital Resources At March 31, 2008, we had cash and cash equivalents of $4,032. Our working capital is presently minimal and there can be no assurance that our financial condition will improve. We expect to continue to have minimal working capital or a working capital deficit as a result of our current liabilities. For the year ended March 31, 2008, we have not generated cash flow from operations. The Company anticipates establishing long-term financing to fund operations in the very near future. As of March 31, 2008, we had cash of $4,032 and a working capital deficit of $69,601. As of March 31, 2008, we had no outstanding debt other than ordinary notes payable to Steven Cozine, Edward Johnson and Jason Smart. The Company will seek funds from possible strategic and joint venture partners and financing to cover any short term operating deficits and provide for long term working capital. No assurances can be given that the Company will successfully engage strategic or joint venture partners or otherwise obtain sufficient financing through the sale of equity. No trends have been identified which would materially increase or decrease our results of operations or liquidity. Going Concern We have suffered recurring losses from operations and are in serious need of additional financing. These factors among others indicate that we may be unable to continue as a going concern, particularly in the event that we cannot obtain additional financing or, in the alternative, affect a merger or acquisition. Our continuation as a going concern depends upon our ability to generate sufficient cash flow to conduct our operations and our ability to obtain additional sources of capital and financing. The accompanying consolidated financial statements have been prepared assuming that we will continue as a going concern. We have a stockholders deficit of $69,601 at March 31, 2008 and net losses from operations of $22,344 and $21,335, respectively, for the years ended March 31, 2008 and 2007. These conditions raise substantial doubt about our ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern. Critical Accounting Policies Use of Estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and 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. Actual results could differ materially from those estimates. Loss per share: Basic loss per share excludes dilution and is computed by dividing the loss attributable to common shareholders by the weighted-average number of common shares outstanding for the period. Diluted loss per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that shared in the earnings of the Company. Diluted loss per share is computed by dividing the loss available to common shareholders by the weighted average number of common shares outstanding for the period and dilutive potential common shares outstanding unless consideration of such dilutive potential common shares would result in anti-dilution. Common stock equivalents were not considered in the calculation of diluted loss per share as their effect would have been anti- dilutive for the periods ended March 31, 2006 and 2005. 13 Off-Balance Sheet Arrangements We have not entered into any off-balance sheet arrangements. We do not anticipate entering into any off-balance sheet arrangements during the next 12 months. ITEM 7. Financial Statements Our financial statements have been examined to the extent indicated in their reports by Pollard-Kelley Auditing Services, Inc. For the year ended March 31, 2008 and have been prepared in accordance with generally accepted Accounting principles and pursuant to Regulation S-B as promulgated by the Securities And Exchange Commission and are included herein, on Page F-1 hereof in response to Part F/S of this Form 10-KSB. ITEM 8. Changes In and Disagreements with Accountants on Accounting and Financial Disclosure. During 2007 we changed auditors from Cinnamon Jang Willoughby & Company to Pollard-Kelley Auditing Services, Inc.. ITEM 8A. Controls and Procedures In order to ensure that the information that we must disclose in our filings with the Commission is recorded, processed, summarized, and reported on a timely basis, we have formalized our disclosure controls and procedures. Our principal executive and financial officer has reviewed and evaluated the effectiveness of our disclosure controls and procedures, as defined in Exchange Act Rules 13a-15(e) and 15d-15(e), as of March 31, 2008. Based on such evaluation, he concluded that, as of March 31, 2008, our disclosure controls and procedures were not effective, because we failed to timely write off an impaired lease deposit and we failed to timely record accrued interest expense. There has been no change in our internal control over financial reporting during 2007 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. PART III ITEM 9 - Directors, Executive Officers, Promoters and Control Persons; Compliance with Section 16(a) of the Exchange Act (a) Set forth below is the names, ages, positions, with the Company and business experiences of the executive officers and directors of the Company. Name Age Position(s) with Company -------------- --- --------------------------------------- Jason Smart 28 Chief Executive Officer, President, Secretary and Director Business Experience Jason Smart, born March 30, 1980, owns and operates Strategic Consultants, Inc., a market research company, based in Ontario Canada. Mr. Smart has owned and operated this company since early 2000. Through Mr. Smart, Strategic Consultants, Inc., provides advertising assessment studies for companies and products. The studies include focus on product and service awareness and satisfaction, competitive analysis of product and services, consumer analysis of product and services, specific customer satisfaction, imaging and positioning of products and services, pricing analysis of product and services and service quality and product/service development, as well as real estate projections. 14 Committees of the Board of Directors We presently do not have an audit committee, compensation committee, nominating committee, an executive committee of our board of directors, stock plan committee or any other committees. However, our board of directors may establish various committees during the current fiscal year. Compensation of Directors Our former director has received cash compensation of $2,300 for his services as a director and may be reimbursed for their reasonable expenses incurred in attending board or committee meetings. Terms of Office Our directors are appointed for one-year terms to hold office until the next annual general meeting of the holders of our Common Stock or until removed from office in accordance with our by-laws. Our officers are appointed by our board of directors and hold office until removed by our board of directors. Involvement in Certain Legal Proceedings Except as indicated above, no event listed in Sub-paragraphs (1) through (4) of Subparagraph (d) of Item 401 of Regulation S-B, has occurred with respect to any of our present executive officers or directors or any nominee for director during the past five years which is material to an evaluation of the ability or integrity of such director or officer. Compliance with Section 16(a) of the Securities Exchange Act of 1934 For companies registered pursuant to section 12(g) of the Exchange Act, Section 16(a) of the Exchange Act requires our executive officers and directors, and persons who beneficially own more than ten percent of our equity securities, to file reports of ownership and changes in ownership with the Securities and Exchange Commission. Officers, directors and greater than ten percent shareholders are required by SEC regulation to furnish us with copies of all Section 16(a) forms they file. To our knowledge, based solely on a review of the copies of reports furnished to us and written representations that no other reports were required, Section 16(a) filing requirements applicable to our officers, directors and greater than ten percent beneficial owners were complied with on a timely basis for the period which this report relates. Code of Ethics In September 2006, we adopted a Code of Ethics that meets the requirements Of Section 406 of the Sarbanes-Oxley Act of 2002. We will provide to any person without charge, upon request, a copy of such Code of Ethics. Persons wishing to make such a request should contact Jason Smart, Chief Executive Officer, 2300 Palm Beach Lakes Blvd., Suite 218, West Palm Beach, FL 33409. (561) 697-8751. Conflicts of Interest None of our officers will devote more than a portion of his time to our affairs. There will be occasions when the time requirements of our business conflict with the demands of the officers other business and investment activities. Such conflicts may require that we attempt to employ additional personnel. There is no assurance that the services of such persons will be available or that they can be obtained upon terms favorable to us. Our officers, directors and principal shareholders may actively negotiate for the purchase of a portion of their common stock as a condition to, or in connection with, a proposed merger or acquisition transaction, if any. In the event that such a transaction occurs, it is anticipated that a substantial premium may be paid by the purchaser in conjunction with any sale of shares by our officers, directors and principal shareholders made as a condition to, or in 15 connection with, a proposed merger or acquisition transaction. The fact that a substantial premium may be paid to members of our management to acquire their shares creates a conflict of interest for them and may compromise their state law fiduciary duties to the our other shareholders. In making any such sale, members of Company management may consider their own personal pecuniary benefit rather than the best interests of the Company and the Company's other shareholders, and the other shareholders are not expected to be afforded the opportunity to approve or consent to any particular buy-out transaction involving shares held by members of Company management. It is not currently anticipated that any salary, consulting fee, or finders fee shall be paid to any of our directors or executive officers, or to any other affiliate of us except as described under Executive Compensation below. Although management has no current plans to cause us to do so, it is possible that we may enter into an agreement with an acquisition candidate requiring the sale of all or a portion of the Common Stock held by our current stockholders to the acquisition candidate or principals thereof, or to other individuals or business entities, or requiring some other form of payment to our current stockholders, or requiring the future employment of specified officers and payment of salaries to them. It is more likely than not that any sale of securities by our current stockholders to an acquisition candidate would be at a price substantially higher than that originally paid by such stockholders. Any payment to current stockholders in the context of an acquisition involving us would be determined entirely by the largely unforeseeable terms of a future agreement with an unidentified business entity. ITEM 10 - Executive Compensation The following table shows all the cash compensation paid by the Company, as well as certain other compensation paid or accrued, during the fiscal year ended March 31, 2008 to the Company's President and highest paid executive officers. No restricted stock awards, long- term incentive plan payouts or other types of compensation, other than the compensation identified in the chart below, were paid to these executive officers during these fiscal years. <TABLE> <CAPTION> SUMMARY COMPENSATION TABLE Long Term Compensation Annual Compensation Awards Payouts -------------------- ----------------------- ------------- Other Restricted Securities LTIP All Name and Annual Stock Underlying Pay- Other Principal Year Salary Bonus Compen- Award(s) Options/ outs Compen- Position (1) ($) ($) sation ($) ($) SARs (f) sation ($) ----------------- ------ -------- -------- ------------ ---------- ------------ -------- ---------- <S> <C> <C> <C> <C> <C> <C> <C> <C> Steven Cozine, 2006 0 0 2,300 0 0 0 0 CEO & President Jason Smart, 2007 0 0 0 0 0 0 0 CEO & President Jason Smart, 2008 0 0 0 0 0 0 0 CEO & President ----------- </TABLE> Compensation of Directors We have no standard arrangements for compensating our board of directors for their attendance at meetings of the Board of Directors. 16 Bonuses and Deferred Compensation We do not have any bonus, deferred compensation or retirement plan. Such plans may be adopted by us at such time as deemed reasonable by our board of directors. We do not have a compensation committee, all decisions regarding compensation are determined by our board of directors. Stock Option and Stock Appreciation Rights. We do not currently have a Stock Option or Stock Appreciation Rights Plan. No stock options or stock appreciation rights were awarded during the fiscal year ended March 31, 2008, or the period ending on the date of this Report. Termination of Employment and Change of Control Arrangement There are no compensatory plans or arrangements, including payments to be received from us, with respect to any person named in cash compensation set out above which would in any way result in payments to any such person because of his resignation, retirement, or other termination of such person's employment with us or our subsidiaries, or any change in control of us, or a change in the person's responsibilities following a changing in control. ITEM 11. Security Ownership of Certain Beneficial Owners and Management The following table sets forth, as of March 31, 2008, information with respect to the beneficial ownership of our common stock by (i) persons known by us to beneficially own more than five percent of the outstanding shares, (ii) each director, (iii) each executive officer and (iv) all directors and executive officers as a group. Common Stock Beneficially Owned ------------------------------ Name and Address Title of Class Number Percent ------------------------------------------------------------------------------- Steven Cozine 1460 Barclay Suite 701 Vancouver, BC Canada V6G1J5 Common 2,500,000 32.2% All Executive Officers and Directors as a Group Common 2,500,000 32.2% (One (1) person) --------------------------------------------------------------------- * Less than 1%. (1) Under Rule 13d-3, a beneficial owner of a security includes any person who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares: (i) voting power, which includes the power to vote, or to direct the voting of shares; and (ii) investment power, which includes the power to dispose or direct the disposition of shares. Certain shares may be deemed to be beneficially owned by more than one person (if, for example, persons share the power to vote or the power to dispose of the shares). In addition, shares are deemed to be beneficially owned by a person if the person has the right to acquire the shares (for example, upon exercise of an option) within 60 days of the date as of which the information is provided. In computing the percentage ownership of any person, the amount of shares outstanding is deemed to include the amount of shares beneficially owned by such person (and only such person) by reason of these acquisition rights. As a result, the percentage of outstanding shares of any person as shown in this table does not necessarily reflect the person's actual ownership or voting power with respect to the number of shares of common stock actually outstanding on March 31, 2008. As of March 31, 2008, there were 7,755,000 shares of our common stock issued and outstanding. 17 ITEM 12. Certain Relationships and Related Transactions Except as described below, none of the following persons has any direct or indirect material interest in any transaction to which we are a party during the past two years, or in any proposed transaction to which the Company is proposed to be a party: (A) any director or officer; (B) any proposed nominee for election as a director; (C) any person who beneficially owns, directly or indirectly, shares carrying more than 5% of the voting rights attached to our common stock; or (D) any relative or spouse of any of the foregoing persons, or any relative of such spouse, who has the same house as such person or who is a director or officer of any parent or subsidiary. ITEM 13. Exhibits and Reports on Form 8-K. (a) The exhibits required to be filed herewith by Item 601 of Regulation S-B, as described in the following index of exhibits, are incorporated herein by reference, as follows: Exhibit No. Description ----------- -------------------------------------------- 31.1 * Certificate of the Chief Executive Officer and Chief Financial Officer pursuant Section 302 of the Sarbanes-Oxley Act of 2002 32.1 * Certificate of the Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 -------------------------- * Included herein (b) Reports on Form 8-K None. ITEM 14. Principal Accountant Fees and Services Audit Fees. The aggregate fees billed for professional services rendered was $10,000 for the audit of our annual financial statements for the fiscal year ended March 31, 2008 and the reviews of the financial statements included in our Forms 10-QSB for the fiscal year. Audit-Related Fees. The aggregate fees billed in each of the last two fiscal years for assurance and related services by the principal accountant that are reasonably related to the performance of the audit or review of our financial statements and not reported under the caption "Audit Fee." Tax Fees. The aggregate fees billed in each of the last two fiscal years for professional services rendered by the principal accountant for tax compliance, tax advice and tax planning services were $0 and $0 respectively. All Other Fees. Other than the services described above, the aggregate fees billed for services rendered by the principal accountant was $0 and $0, respectively, for the fiscal years ended March 31, 2008. We have no formal audit committee. However, our entire Board of Directors (the "Board") is our defacto audit committee. In discharging its oversight responsibility as to the audit process, the Board obtained from the independent auditors a formal written statement describing all relationships between the auditors and us that might bear on the auditors' independence as required by 18 Independence Standards Board Standard No. 1, "Independence Discussions with Audit Committees." The Board discussed with the auditors any relationships that may impact their objectivity and independence, including fees for non-audit services, and satisfied itself as to the auditors' independence. The Board also discussed with management, the internal auditors and the independent auditors the quality and adequacy of its internal controls. The Board reviewed with the independent auditors their management letter on internal controls. The Board discussed and reviewed with the independent auditors all matters required to be discussed by auditing standards generally accepted in the United States of America, including those described in Statement on Auditing Standards No. 61, as amended, "Communication with Audit Committees". The Board reviewed the audited consolidated financial statements of the Company as of and for the year ended March 31, 2008 with management and the independent auditors. Management has the responsibility for the preparation of the Company's financial statements and the independent auditors have the responsibility for the examination of those statements. Based on the above-mentioned review and discussions with the independent auditors and management, the Board of Directors approved the Company's audited consolidated financial statements and recommended that they be included in its Annual Report on Form 10-KSB for the year ended March 31, 2008, for filing with the Securities and Exchange Commission. The Board also approved the reappointment of Pollard-Kelley Auditing Services, Inc. as independent auditors. [Balance of this page intentionally left blank.] 19 ZANDARIA VENTURES INC. (An Exploration Stage Company) REPORT AND FINANCIAL STATEMENTS March 31, 2008 and 2007 (Stated in US Dollars) CONTENTS Page Report of Registered Independent Certified Public Accounting Firm F-2 Financial Statements Balance Sheets as of March 31, 2008 and 2007 F-3 Statement of Operations for the years ended March 31, 2008 and 2007 F-4 Statement of Cash Flows for the years ended March 31, 2008 and 2007 F-5 Statement of Changes in Stockholders' Equity for the years ended March 31, 2008 and 2007 F-6 Notes to Consolidated Financial Statements F-7 F-1 Pollard-Kelley Auditing Services, Inc........................................... Auditing Services 4500 Rockside Road, Suite 450, Independence, OH 44131 330-864-2265 Report of Independent Registered Public Accounting Firm Zandaria Ventures, Inc. (An Exploration Stage Company) We have audited the accompanying balance sheets of Zandaria Ventures, Inc., (An Exploration Stage Company) as of March 31, 2008, and the related statements of income, changes in stockholders' equity, and cash flows for the one year in the period ended March 31, 2008 and for the period from February 23, 2005 through March 31, 2008 (since inception). These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conduct our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. As discussed in Note 1 the Company has not generated significant revenues or profits to date. This factor among others raises substantial doubt the Company will be able to continue as a going concern. The Company's continuation as a going concern depends upon its ability to generate sufficient cash flow to conduct its operations and its ability to obtain additional sources of capital and financing. The accompanying consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Management's plans concerning this matter are also discussed in Note 1. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company at March 31, 2008, and the results of its operations and it cash flows for the one year in the period ended March 31, 2008 and for the period from February 23, 2005 through March 31, 2008 (since inception), in conformity with U.S. generally accepted accounting standards. Pollard-Kelley Auditing Services, Inc. /s/ Pollard-Kelley Auditing Services, Inc. Independence, Ohio July 11, 2008 F-2 <TABLE> <CAPTION> ZANDARIA VENTURES INC. (An Exploration Stage Company) BALANCE SHEET March 31, 2008 and 2007 (Stated in US Dollars) March 31, March 31, 2008 2007 ------------- ------------ <S> <C> <C> ASSETS Current Cash $ 4,032 $ 5,585 Prepaid expenses 1,091 2,366 ------------- ------------ $ 5,123 $ 7,951 ============= ============ LIABILITIES Current Accounts payable and accrued liabilities $ 13,150 $ 13,297 Notes payable 38,599 19,186 ------------- ------------ 51,749 32,483 Derivative Liability arising from note conversion rights 2,625 2,375 STOCKHOLDER'S EQUITY Capital stock Authorized: 75,000,000 common shares with a par value of $0.001 Issued and outstanding: 7,755,000 common shares (March 31, 2007: 7,752,500) 7,755 7,753 Additional paid-in capital 12,845 12,597 Accumulated other comprehensive income (250) - Deficit accumulated during the pre-exploration stage (69,601) (47,257) ------------- ------------ (49,251) (26,907) ------------- ------------ $ 5,123 $ 7,951 ============= ============ </TABLE> See accompanying notes to financial statements. F-3 <TABLE> <CAPTION> ZANDARIA VENTURES INC. (An Exploration Stage Company) STATEMENT OF OPERATIONS For the years ended March 31, 2008 and 2007 and for the period February 23, 2005 (Date of Inception) to March 31, 2008 (Stated in US Dollars) Cumulative from February 23, 2005 (Date of Inception) to March 31, 2008 2007 2008 ------------- ------------- ------------------ <S> <C> <C> <C> EXPENSES Management fees $ - $ - $ 4,100 Professional fees 18,600 2,300 44,638 Consulting fees 250 7,019 250 Organizational costs - - 500 Geological, mineral, prospect costs - 7,240 9,740 General and administrative costs 3,494 4,776 10,373 ------------- ------------- ------------------ Net Loss (22,344) (21,335) (69,601) Other Comprehensive Income from Abandonment of conversion rights 250 - 250 ------------- ------------- ------------------ Loss for the period $ (22,594) $ (21,335) $ (69,851) Basic and diluted loss per share $ 0.00 $ 0.00 ============= ============= Weighted average number of shares outstanding 7,754,896 7,750,007 ============= ============= </TABLE> See accompanying notes to financial statements. F-4 <TABLE> <CAPTION> ZANDARIA VENTURES INC. (An Exploration Stage Company) STATEMENT OF CASH FLOWS For the years ending March 31, 2008 and 2007 and For the period February 23, 2005 (Date of Inception) to March31, 2008 (Stated in US Dollars) Cumulative from February 23, 2005 (Date of Inception) to March 31, 2008 2007 2008 -------------- ------------- ------------------ <S> <C> <C> <C> Operating Activities Net loss for the period $ (25,202) $ (21,335) $ (72,459) Common stock issued for services 250 250 500 Amortization of prepaid interest 3,083 9 5,458 Adjustments to reconcile loss to cash used by operating activities: Shareholder advances - - - Prepaid expenses 1,275 - (1,091) Accounts payable and accrued liabilities (147) 1,804 13,150 -------------- ------------- ------------------ (20,741) (19,272) (54,442) Investing Activities - - - Financing Activities Common stock issued for cash - - 20,100 Notes payable - payments (5,000) - (5,000) -- Borrowing 24,188 19,186 43,374 -------------- ------------- ------------------ 19,188 19,186 58,474 Increase (decrease) in cash during the period 1,553 (86) 4,032 Cash, beginning of the period 5,585 5,671 - -------------- ------------- ------------------ Cash, end of the period $ 4,032 $ 5,585 $ 4,032 ============== ============= ================== </TABLE> See accompanying notes to financial statements. F-5 <TABLE> <CAPTION> ZANDARIA VENTURES INC. (An Exploration Stage Company) STATEMENT OF STOCKHOLDER'S EQUITY (DEFICIENCY) For the period February 23, 2005 to March 31, 2008 (Stated in US Dollars) Deficit Accumulated Accumulated Common Stock Additional During the Other Number of Paid-in Exploration Comprehensive Shares Amount Capital Stage Income Total ---------------------------------------------------------------------------------- <S> <C> <C> <C> <C> <C> <C> Balance, February 23, 2005 - $ - $ - $ - $ - $ - ---------------------------------------------------------------------------------- Shares issued at $0.001 2,500,000 2,500 - - 2,500 Shares issued at $0.003 700,000 700 1,400 - - 2,100 Shares issued at $0.0025 4,000,000 4,000 6,000 - - 10,000 Shares issued at $0.01 550,000 550 4,950 - - 5,500 Net loss for the period - - - (820) - (820) ---------------------------------------------------------------------------------- Balance, March 31, 2005 7,750,000 $ 7,750 $ 12,350 $ (820) $ - $ 19,280 Net loss for the period - - - (25,102) - (25,102) ---------------------------------------------------------------------------------- Balance, March 31, 2006 7,750,000 $ 7,750 $ 12,350 $ (25,922) $ - $ (5,822) Shares issued for services 2,500 3 247 - - 250 Net loss for the period (21,335) - (21,335) ---------------------------------------------------------------------------------- Balance, March 31, 2007 7,752,500 $ 7,753 $ 12,597 $ (47,257) $ - $ (26,907) Shares issued for services 2,500 248 2 - - 250 Net Comprehensive Loss - - - (22,344) (250) (22,594) ---------------------------------------------------------------------------------- Balance, March 31, 2008 7,755,000 $ 7,755 $ 12,845 $ (69,601) $ (250) $ (49,251) ================================================================================== </TABLE> See accompanying notes to financial statements. F-6 ZANDARIA VENTURES INC. (An Exploration Stage Company) NOTES TO THE FINANCIAL STATEMENTS March 31, 2008 Note 1. Nature and Continuance of Operations The Company was incorporated in the State of Nevada on February 23, 2005 and is in the pre-exploration stage. The Company has acquired a mineral property located in the Province of British Columbia, Canada and has not yet determined whether this property contains reserves that are economically recoverable. The recoverability of amounts from the property will be dependent upon the discovery of economically recoverable reserves, confirmation of the Company's interest in the underlying property, the ability of the Company to obtain necessary financing to satisfy the expenditure requirements under the property agreement and to complete the development of the property and upon future profitable production or proceeds for the sale thereof. These financial statements have been prepared on a going concern basis. The Company has accumulated a deficit of $69,601 since inception, has yet to achieve profitable operations and further losses are anticipated in the development of its business, raising substantial doubt about the Company's ability to continue as a going concern. Its ability to continue as a going concern is dependent upon the ability of the Company to generate profitable operations in the future and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. These financial statements do not include any adjustments to the amounts and classification of assets and liabilities that may be necessary should the Company be unable to continue as a going concern. The Company anticipates that additional funding will be in the form of equity financing from the sale of common stock. The Company may also seek to obtain short-term loans from the directors of the Company. There are no current arrangements in place for equity funding or short-term loans. The Company has adopted March 31 as its fiscal year-end. Note 2. Summary of Significant Accounting Policies Basis of Presentation The financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America. Because a precise determination of many assets and liabilities is dependent upon future events, the preparation of financial statements for a period necessarily involves the use of estimates which have been made using careful judgment. Actual results may vary from these estimates. The financial statements have, in management's opinion, been properly prepared within the framework of the significant accounting policies summarized as follows: F-7 ZANDARIA VENTURES INC. (An Exploration Stage Company) NOTES TO FINANCIAL STATEMENTS March 31, 2008 Note 2. Summary of Significant Accounting Policies - (cont'd) Pre-exploration Stage Company The Company complies with Financial Accounting Standard Board Statement ("FAS") No. 7 and The Securities and Exchange Commission Exchange Act Guide 7 for its characterization of the Company as pre-exploration stage. Mineral Property Costs Mineral property acquisition, exploration and development costs are expensed as incurred until such time as economic reserves are quantified. From that time forward, the Company will capitalize all costs to the extent that future cash flows from mineral reserves equal or exceed the costs deferred. The deferred costs will be amortized over the recoverable reserves when a property reaches commercial production. Costs related to site restoration programs will be accrued over the life of the project. To date, the Company has not established any proven reserves on its mineral properties. Financial Instruments The carrying value of cash, accounts payable and accrued liabilities and due to shareholder approximates their fair value because of the short maturity of these instruments. Unless otherwise noted, it is management's opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial instruments. Environmental Costs Environmental expenditures that relate to current operations are expensed or capitalized as appropriate. Expenditures that relate to an existing condition caused by past operations, and which do not contribute to current or future revenue generation, are expensed. Liabilities are recorded when environmental assessments and/or remedial efforts are probable, and the cost can be reasonably estimated. Generally, the timing of these accruals coincides with the earlier of completion of a feasibility study or the Company's commitments to plan of action based on the then known facts. F-8 ZANDARIA VENTURES INC. (An Exploration Stage Company) NOTES TO FINANCIAL STATEMENTS March 31, 2008 Note 2. Summary of Significant Accounting Policies - (cont'd) Income Taxes The Company uses the assets and liability method of accounting for income taxes pursuant to FAS No. 109 "Accounting for Income Taxes". Under the assets and liability method of FAS No. 109, deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Basic and Diluted Loss Per Share The Company reports basic loss per share in accordance with the FAS No. 128, "Earnings Per Share". Basic loss per share is computed using the weighted average number of shares outstanding during the period. Diluted loss per share has not been provided as there are no additional securities, financial instruments or other items that could affect earnings per share. New Accounting Standards Management does not believe that any recently issued, but not yet effective, accounting standards if currently adopted could have a material effect on the accompanying financial statements. Note 3. Mineral Property On April 5, 2005, the Company entered into a purchase and sale agreement, which was amended on April 6, 2006, to acquire a 100% interest in a mineral claim located in British Columbia, Canada. In order to earn the interest, the Company is required to: a) pay $2,500 on execution of the agreement (paid March 29, 2005); b) pay $1,000 for amendment of the agreement (not paid); c) pay $17,500 on or before April 5, 2007 (not paid) This agreement is subject to a 2 1/2% net smelter royalty and a 7 1/2% gross rock royalty for a total of $20,000. The Company is in default under this agreement at March 31, 2008. F-9 ZANDARIA VENTURES INC. (An Exploration Stage Company) NOTES TO FINANCIAL STATEMENTS March 31, 2008 Note 4. Related Party Transaction At March 31, 2008, the Company owed an accounts payable of $1,400 and a Note payable of $9,186 to the former President and CEO of the Company who resigned on March 13, 2007. Also, at March 31, 2008, the Company owed Notes payable plus interest of $24,413 to the president of the company. Note 5. Notes Payable The promissory notes payable are unsecured and bear no interest per annum. March 31, 2008 ------------- August 04, 2006 $ 5,000 September 01, 2006 900 February 02, 2007 8,286 April 16, 2007 4,780 - July 11, 2007 4,633 ------------- July 17, 2007 5,000 October 18, 2007 10,000 ------------- $ 38,599 The April 16, 2007, note payable also has conversion rights which allow for the conversion of the note in whole or in part at any time prior to the payment or within ten days thereafter into common stock of the Company at a conversion rate of the lesser of 66 2/3% of the average closing bid and ask price on the date of conversion or $0.25 per share. Note 6. Stock Issued for Services The Company accounts for equity instruments issued to non-employees in accordance with the provisions of SFAS No. 123R and Emerging Issues Task Force ("EITF") Issue No. 96-18, "Accounting for Equity Instruments That Are Issued to Other Than Employees for Acquiring, or in Conjunction with Selling, Goods or Services". All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued whichever is more reliably measurable. The measurement date of the fair value of the equity instrument issued is the earlier of the date on which the counter party's performance is complete or the date on which it is probable that performance will occur. The amounts that have been charged against income for those services were $250 for the year ended March 31, 2007 and $250 for the year ended March 31, 2008. F-10 ZANDARIA VENTURES INC. (An Exploration Stage Company) NOTES TO FINANCIAL STATEMENTS March 31, 2008 Note 7. Deferred Tax Assets The significant components of the Company's deferred tax assets are as follows: March 31, March 31, 2008 2007 ------------------------------------------------------------------------------- Deferred Tax Assets Non-capital loss carry forward $ - $ - Less: valuation allowance for deferred tax asset (-) (-) ------------------------------------------------------------------------------- $ - $ - ------------------------------------------------------------------------------- Deferred tax assets reflect the tax effects of temporary differences between the carrying amounts and liabilities for financial reporting purposes and the amounts used for income tax purposes. No deferred tax asset has been recorded as a full valuation allowance has been applied. Note 8. Corporation Income Tax Losses The actual income tax recovery differs from the expected income tax recovery as follows: March 31, March 31, March 31, 2008 2007 2006 ------------------------------------------------------------------------------ Expected income taxes at 34% $ - $ - $ 8,022 Less: valuation allowance for loss carry forwards (-) (-) (8,022) ------------------------------------------------------------------------------ $ - $ - $ - ------------------------------------------------------------------------------ At March 31, 2008, the Company has accumulated non-capital losses totaling $69,601, which are available to reduce taxable income in future taxation years. The potential benefit arising from these losses has been offset with a full valuation allowance. These losses will expire in 2028. F-11 SIGNATURES In accordance with the Exchange Act, this report has been signed below by the following persons on our behalf and in the capacities and on the dates indicated. ZANDARIA VENTURES, INC. ---------------------------------------- (Registrant) Date: JULY 11, 2008 By: /s/ JASON SMART --------------------------------- Jason Smart, President and Director Pursuant to the requirements of the Exchange Act, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. Signature Title Date /s/ JASON SMART ------------------------- Jason Smart CEO, President & Director July 11, 2008 31 </TEXT> </DOCUMENT>