Annual report pursuant to section 13 and 15(d)

STATEMENTS OF CASH FLOWS

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STATEMENTS OF CASH FLOWS (USD $)
 12 Months Ended
Dec. 31, 2013
Dec. 31, 2012
Cash Flows from Operating Activities    
Net Loss $ (648,567) $ (864,995)
Adjustments to reconcile net loss to net cash used in operating activities:    
Depreciation 5,715 7,177
Amortization of software    27,017
Amortization of prepaids    16,538
Amortization of prepaid consulting shares for services 29,708 22,500
Amortization of discounts 67,755 24,953
Gain on Settlement (13,981)   
Officers contributed salaries 194,958   
Options issued for services 16,388 4,000
Stock issued for Director's services    10,000
Amortization of beneficial conversion value and warrant discounts 1,833 217,972
Bad Debt Expense 5,490   
Expense for warrant term modifications 31,500   
Interest and default penalty on convertible note 24,063   
Changes in operating assets and liabilities:    
Accounts receivable 3,522 148,524
Prepaids 5,439   
Other assets 3,000   
Accounts payable 85,243 41,185
Accounts payable - related party (6,156) 628
Accrued expenses 31,647 125,694
Accrued interest 8,872 10,612
Deferred revenue (7,263) 38,445
Net Cash Used in Operating Activities (160,834) (169,750)
Cash Flows from Financing Activities    
Proceeds (Repayments) from checks written in excess of cash balances (3,880) 3,880
Proceeds from notes - related parties 175,597   
Repayments of notes - related parties (74,534)   
Proceeds from shareholder 60,000 135,000
Repayment to shareholder    (10,000)
Repayment of convertible notes, shareholders (14,932)   
Proceeds from factor, net of repayments (24,587) (90,539)
Proceed from notes related parties    284,094
Repayment of notes related parties    (145,764)
Insurance premium repayments (4,613) (9,792)
Proceeds from line of credit facility 39,981 164,192
Repayments of line of credit facility (37,032) (162,309)
Proceeds from third party note 45,000   
Net Cash Provided by Financing Activities 161,000 168,762
Net Change in Cash and Cash Equivalents 166 (988)
Cash and Cash Equivalents at Beginning of year    988
Cash and Cash Equivalents at End of year 166   
Supplemental disclosure of cash flow information:    
Cash paid for interest 87,592 25,500
Cash paid for taxes      
Non-cash investing and financing activity:    
Conversion of convertible notes and accrued interest 106,563   
Common stock issued for prepaid services 59,500   
Premium financing    10,230
Conversion of officer's accrued payroll to loans    125,694
Conversion of note payable to common stock    137,500
Original issue discount related to notes payable    41,000
Beneficial conversion feature and warrants related to notes payable    $ 129,015