Item 1.  Condensed Financial Statements
 
Racino Royale, Inc. and Subsidiaries
 (A Development Stage Company)
Condensed Consolidated Balance Sheet
June 30, 2008

   
(UNAUDITED)
 
       
ASSETS
     
       
Current assets:
     
Cash and cash equivalents
  $ 2,888  
Prepaid
    5,870  
Total current assets
    8,758  
         
Intangibles (Note 4)
    1,228,965  
         
TOTAL ASSETS
  $ 1,237,723  
         
LIABILITIES AND STOCKHOLDERS’ EQUITY
       
         
Current liabilities:
       
         
Due to related parties (Note 5)
    307,140  
Accounts payable
    61,837  
Accrued liabilities
    11,387  
Total current liabilities
    380,364  
         
Stockholders’ equity
       
Common stock, $.00001 par value per share;
100,000,000 shares authorized, 56,523,886 shares issued and outstanding
     
Additional paid-in capital
    8,257,161  
Accumulated deficit
    (7,400,368 )
Total stockholders’ equity
    857,359  
         
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
  $ 1,237,723  


See accompanying notes to financial statements
 
Racino Royale, Inc. and Subsidiaries
 (A Development Stage Company)
Condensed Consolidated Statements of Operations and Comprehensive Loss
For the Three Months and Nine Months Ended June 30, 2008, and June 30, 2007 and the Period from Re-entering the Development Stage Through to June 30, 200
   
Three months ended
June 30,
   
Three months ended
June 30,
   
Nine months
ended
June 30,
   
Nine months
Ended
June 30,
 2007
   
(Note 1)
Period from
re-entering the Development Stage through to June 30, 2008
 
Revenues:
                             
Provincial grant income
  $ -     $ -     $ -     $ -     $ 96,347  
Parimutuel betting income
    -       -       -       -       19,018  
Miscellaneous income
    -       -       -       -        
Total revenues
    -       -       -       -       115,936  
                                         
Cost of revenues:
                                       
Purses and rewards
    -       -       -       -       60,177  
Bets paid out
    -       -       -       -       12,539  
Total cost of revenues
    -       -       -       -       72,716  
                                         
Gross profit
    -       -       -       -       43,220  
                                         
Operating expenses:
                                       
Management fees – related parties
    126,639       -       248,952       -       300,695  
Professional fees
    19,152       -       111,854       -       177,250  
General and administrative
    30,902       33,240       129,402       87,634       316,309  
Total operating expenses
    176,693       33,240       490,208       87,634       794,254  
                                         
Net loss before other expenses and income taxes
    (176,693 )     (33,240 )     (490,208 )     (87,634 )     (751,034 )
                                         
Other expenses
                                       
Foreign currency gain
            -               -       1,399  
Loss from impairment of licensing rights
            -               -       (1,317,471 )
Loss from continuing operations
    (176,693 )     (33,240 )     (490,208 )     (87,634 )     (2,067,106 )
                                         
Income from discontinued operations, Net of income taxes
            -               -