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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT
PURSUANT TO SECTION 13 OR 15 (D)
of the
SECURITIES AND EXCHANGE ACT OF 1934
For the quarter ended September 30, 2003
Systems evolution, INC.
(Formerly Wallace Resources, Inc.)
(Exact name of registrant as specified in its charter)
IDAHO
(State or other jurisdiction of incorporation or organization)
82-0291029
(IRS Employer Identification Number)
10707 Corporate Drive, Suite 156
Stafford, Texas 77477
(Address of principal executive offices)
Robert C. Rhodes, President
Systems Evolution, Inc.
10707 Corporate Drive, Suite 156
Stafford, Texas 77477
(Name and address of agent for service)
(281) 265-7075
(Telephone number, including area code of agent for service)
Indicate by check mark whether the Registrant (1) has filed all
documents and reports required to be filed by Section 13 or 15(d) of the
Securities and Exchange Act of 1934 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.
X Yes No
------- -------
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Class Outstanding at December 22, 2003
----- --------------------------------
Common Stock, no par value 5,032,058
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THE FOLLOWING FINANCIALS WERE NOT AUDITED BY AN INDEPENDENT AUDITOR.
Balance Sheet
Sep 30, 02
-----------------
ASSETS
Current Assets
Checking/Savings
Checking Accounts
Sterling Bank 25,750.96
-----------------
Total Checking Accounts 25,750.96
-----------------
Total Checking/Savings 25,750.96
Accounts Receivable
Accounts Receivable 267,644.93
-----------------
Total Accounts Receivable 267,644.93
Other Current Assets
Prepaid Federal Income Taxes 0.48
Scottrade Brokerage Account 40,025.00
-----------------
Total Other Current Assets 40,025.48
-----------------
Total Current Assets 333,421.37
Fixed Assets
FA Computers
Accumulated Depreciation -49,938.00
Original Cost 72,484.16
-----------------
Total FA Computers 22,546.16
FA Office Furniture & Equipment
Accumulated Depreciation -63,662.00
Original Cost 68,053.28
-----------------
Total FA Office Furniture & Equipment 4,391.28
FA Vehicles
Accumulated Depreciation -10,694.00
Original Cost 61,494.00
-----------------
Total FA Vehicles 50,800.00
-----------------
Total Fixed Assets 77,737.44
Other Assets
Notes to officers
Note - #1 RCR 31,043.90
-----------------
Total Notes to officers 31,043.90
-----------------
Total Other Assets 31,043.90
-----------------
TOTAL ASSETS 442,202.71
=================
LIABILITIES & EQUITY
Liabilities
Current Liabilities
Accounts Payable
Accounts Payable 4,563.17
-----------------
Total Accounts Payable 4,563.17
Credit Cards
American Express
AMEX - ERT 1,013.17
AMEX - JDM 416.89
AMEX - RCR 11,597.25
American Express - Other 281.39
-----------------
Total American Express 13,308.70
Expense Accounts
Anderson, Patrick L. 201.08
ARR 53.07
KJC 284.86
Rhodes, Robert C. -48.08
TCE 150.00
-----------------
Total Expense Accounts 640.93
Lines of Credit
American Express Centurian
Bank 23,358.37
-----------------
Total Lines of Credit 23,358.37
-----------------
Total Credit Cards 37,308.00
Other Current Liabilities
Payroll Liabilities
401K Contributions 5,648.40
Section 125 - Cafeteria Plan 1,503.03
-----------------
Total Payroll Liabilities 7,151.43
Sales Tax Payable -19.58
-----------------
Total Other Current Liabilities 7,131.85
-----------------
Total Current Liabilities 49,003.02
Long Term Liabilities
LT Loans
Classroom (Sterling Bank) 5,828.11
Ford Credit - 2001 Towncar 25,820.64
Sterling Bank Term Loan (LOC) 149,196.81
-----------------
Total LT Loans 180,845.56
-----------------
Total Long Term Liabilities 180,845.56
-----------------
Total Liabilities 229,848.58
Equity
Capital Stock 1,000.00
Retained Earnings 213,576.18
Net Income -2,222.05
-----------------
Total Equity 212,354.13
-----------------
TOTAL LIABILITIES & EQUITY 442,202.71
=================
Statements of Cash Flow
Jan - Sep
02
-----------
OPERATING ACTIVITIES
Net Income -136,538.25
Adjustments to reconcile Net Income to net
cash provided by operations:
Accounts Receivable -41,608.60
Prepaid Federal Income Taxes 4,547.00
Accounts Payable -44,779.82
American Express 281.39
American Express:AMEX - ERT -4,935.34
American Express:AMEX - JDM -763.60
American Express:AMEX - RCR 8,385.16
Expense Accounts:Anderson, Patrick L. 201.08
Expense Accounts:ARR 53.07
Expense Accounts:ERT 2,131.19
Expense Accounts:KJC 284.86
Expense Accounts:Rhodes, Robert C. -48.08
Expense Accounts:TCE 150.00
Lines of Credit:American Express Centurian
Bank 23,358.37
Long Term Loans:Southwest Bank of Texas LOC -50,000.00
Payroll Liabilities:401K Contributions -452.05
Payroll Liabilities:Section 125 - Cafeteria
Plan -826.44
Sales Tax Payable -354.09
-----------
Net cash provided by Operating Activities -240,914.15
INVESTING ACTIVITIES
FA Computers:Original Cost -3,123.72
-----------
Net cash provided by Investing Activities -3,123.72
FINANCING ACTIVITIES
LT Loans:Classroom (Sterling Bank) 5,828.11
LT Loans:Ford Credit - 2001 Towncar -5,379.30
LT Loans:Sterling Bank Term Loan (LOC) 149,196.81
-----------
Net cash provided by Financing Activities 149,645.62
-----------
Net cash increase for period -94,392.25
Cash at beginning of period 120,143.21
-----------
Cash at end of period 25,750.96
===========
Statements of Cash Flow
Jul -
Sep 02
----------
OPERATING ACTIVITIES
Net Income 2,710.81
Adjustments to reconcile Net Income
to net cash provided by operations:
Accounts Receivable 37,296.45
Accounts Payable -12,519.20
American Express 281.39
American Express:AMEX - ERT -2,498.87
American Express:AMEX - JDM 302.59
American Express:AMEX - RCR 8,116.67
Expense Accounts:Anderson, Patrick L. 617.39
Expense Accounts:ARR 53.07
Expense Accounts:ERT -56.08
Expense Accounts:KJC 284.86
Expense Accounts:Rhodes, Robert C. -24.62
Expense Accounts:TCE 97.32
Lines of Credit:American Express Centurian
Bank 23,358.37
Payroll Liabilities:401K Contributions -889.95
Payroll Liabilities:Section 125 - Cafeteria
Plan 580.17
Sales Tax Payable -79.80
----------
Net cash provided by Operating Activities 57,630.57
FINANCING ACTIVITIES
LT Loans:Classroom (Sterling Bank) -5,849.90
LT Loans:Ford Credit - 2001 Towncar -1,613.79
LT Loans:Sterling Bank Term Loan (LOC) -25,000.00
----------
Net cash provided by Financing Activities -32,463.69
----------
Net cash increase for period 25,166.88
Cash at beginning of period 584.08
----------
Cash at end of period 25,750.96
==========
Jan - Sep 02
-----------------
Ordinary Income/Expense
Income
Consulting 1,152,025.01
Monthly Recurring 3,190.00
Other Regular Income 537.93
Product Sales
Course Manuals 1,000.00
SEI Products 4,000.00
-----------------
Total Product Sales 5,000.00
Reimbursed Expenses 18,079.36
Training 22,600.00
-----------------
Total Income 1,201,432.30
-----------------
Gross Profit 1,201,432.30
Expense
Automobile Expense
Gas Expense 2,130.82
Mileage 3,945.49
Servicing 142.86
-----------------
Total Automobile Expense 6,219.17
Bank Service Charges 1,035.67
Certification & Education
Dues 4,200.00
Education 716.00
Subscriptions 1,642.47
-----------------
Total Certification & 6,558.47
Education
Computers
Computer Lease 6,187.49
Hardware 24,098.92
Software 6,215.99
-----------------
Total Computers 36,502.40
Contributions 400.00
Insurance
Liability Insurance 4,720.20
Work Comp 6,736.40
-----------------
Total Insurance 11,456.60
Interest Expense 6,702.18
Office Expense
Postage and Delivery 1,276.97
Printing and Reproduction 716.41
Rent 34,765.39
Supplies 5,442.48
-----------------
Total Office Expense 42,201.25
Payroll Expenses
401K Company Contribution 17,967.52
Benefits 1,226.05
Payroll taxes 34,130.84
Subcontract Labor 245,524.28
Wages 435,787.27
Wages, PEO 421,224.81
-----------------
Total Payroll Expenses 1,155,860.77
Professional Fees
Accounting 975.00
Legal Fees 2,007.00
Payroll service 4,684.53
-----------------
Total Professional Fees 7,666.53
Sales & Marketing 11,830.88
Taxes
Property Tax 86.07
State 1,504.26
-----------------
Total Taxes 1,590.33
Travel & Ent
Car Rental 122.93
Entertainment 10,502.96
Hotel/Lodging 603.15
Meals - 100% deductable 3,296.70
Meals - 50% deductable 5,518.54
Travel 3,355.07
Travel & Ent - Other 48.54
-----------------
Total Travel & Ent 23,447.89
Utilities
Internet Access 15,975.01
Telephone 3,893.42
Telephone - Cellular 5,341.59
-----------------
Total Utilities 25,210.02
-----------------
Total Expense 1,336,682.16
-----------------
Net Ordinary Income -135,249.86
Other Income/Expense
Other Income
Interest Income 1,281.75
-----------------
Total Other Income 1,281.75
Other Expense
Other Expenses 2,570.14
-----------------
Total Other Expense 2,570.14
-----------------
Net Other Income -1,288.39
-----------------
Net Income -136,538.25
=================
Jul - Sep
02
-----------
Ordinary Income/Expense
Income
Consulting 359,548.20
Monthly Recurring 900.00
Reimbursed Expenses 2,483.33
Training 8,700.00
-----------
Total Income 371,631.53
-----------
Gross Profit 371,631.53
Expense
Automobile Expense
Gas Expense 728.03
Mileage 1,013.26
-----------
Total Automobile Expense 1,741.29
Bank Service Charges 291.00
Certification & Education
Education -99.00
Subscriptions 411.29
-----------
Total Certification & 312.29
Education
Computers
Computer Lease 1,780.79
Hardware 1,933.18
Software 3,018.63
-----------
Total Computers 6,732.60
Contributions 400.00
Insurance
Liability Insurance 841.34
Work Comp 2,725.60
-----------
Total Insurance 3,566.94
Interest Expense 3,313.85
Office Expense
Postage and Delivery 318.42
Printing and Reproduction -183.71
Rent 7,670.04
Supplies 1,573.69
-----------
Total Office Expense 9,378.44
Payroll Expenses
401K Company Contribution 6,409.44
Benefits 606.07
Subcontract Labor 106,109.69
Wages, PEO 213,469.58
-----------
Total Payroll Expenses 326,594.78
Professional Fees
Legal Fees 915.00
Payroll service 1,045.34
-----------
Total Professional Fees 1,960.34
Sales & Marketing 461.00
Travel & Ent
Entertainment 2,155.46
Hotel/Lodging 466.55
Meals - 100% deductable 1,564.64
Meals - 50% deductable 1,810.24
Travel 1,043.50
Travel & Ent - Other 48.54
-----------
Total Travel & Ent 7,088.93
Utilities
Internet Access 4,434.27
Telephone 1,113.62
Telephone - Cellular 1,531.37
-----------
Total Utilities 7,079.26
-----------
Total Expense 368,920.72
-----------
Net Ordinary Income 2,710.81
-----------
Net Income 2,710.81
===========
Balance Sheet
Sep 30, 03
------------------
ASSETS
Current Assets
Checking/Savings
Checking Accounts
Sterling Bank -205.82
------------------
Total Checking Accounts -205.82
------------------
Total Checking/Savings -205.82
Accounts Receivable
Accounts Receivable 161,170.35
------------------
Total Accounts Receivable 161,170.35
Other Current Assets
Scottrade Brokerage Account 40,025.00
------------------
Total Other Current Assets 40,025.00
------------------
Total Current Assets 200,989.53
Fixed Assets
FA Computers
Accumulated Depreciation -53,005.00
Original Cost 65,662.16
------------------
Total FA Computers 12,657.16
FA Office Furniture & Equipment
Accumulated Depreciation -65,418.00
Original Cost 68,053.28
------------------
Total FA Office Furniture & Equipment 2,635.28
FA Vehicles
Accumulated Depreciation -7,960.00
Original Cost 46,814.00
------------------
Total FA Vehicles 38,854.00
------------------
Total Fixed Assets 54,146.44
Other Assets
Notes to officers
Note - #1 RCR 285.65
Note - #3 Patrick L. Anderson 20,000.00
------------------
Total Notes to officers 20,285.65
------------------
Total Other Assets 20,285.65
------------------
TOTAL ASSETS 275,421.62
==================
LIABILITIES & EQUITY
Liabilities
Current Liabilities
Accounts Payable
Accounts Payable 78,807.04
------------------
Total Accounts Payable 78,807.04
Credit Cards
American Express
AMEX - JDM 247.05
AMEX - RCR 2,653.60
American Express - Other 44.14
------------------
Total American Express 2,944.79
Expense Accounts
Anderson, Patrick L. 20,333.92
Muegge, Jennifer D. -44.95
Rhodes, Robert C. 1,654.03
------------------
Total Expense Accounts 21,943.00
Lines of Credit
American Express Centurian
Bank 27,426.79
Textron PurchaseLine 23,732.14
------------------
Total Lines of Credit 51,158.93
------------------
Total Credit Cards 76,046.72
Other Current Liabilities
Payroll Liabilities
401K Contributions 1,017.61
Accrued Payroll (not paid) 13,000.00
------------------
Total Payroll Liabilities 14,017.61
Sales Tax Payable 765.44
------------------
Total Other Current Liabilities 14,783.05
------------------
Total Current Liabilities 169,636.81
Long Term Liabilities
LT Loans
Ford Credit - 2001 Towncar 19,365.48
Sterling Bank Term Loan (LOC) 101,529.91
------------------
Total LT Loans 120,895.39
------------------
Total Long Term Liabilities 120,895.39
------------------
Total Liabilities 290,532.20
Equity
Capital Stock 70,140.00
Retained Earnings 63,645.51
Net Income -148,896.09
------------------
Total Equity -15,110.58
------------------
TOTAL LIABILITIES & EQUITY 275,421.62
==================
Jan - Sep 03
-----------------
OPERATING ACTIVITIES
Net Income -297,712.33
Adjustments to reconcile Net Income to net
cash provided by operations:
Accounts Receivable 41,765.29
Accounts Payable 73,913.14
American Express:AMEX - JDM 191.88
American Express:AMEX - RCR 2,680.58
Expense Accounts:Anderson, Patrick L. 20,333.92
Expense Accounts:Muegge, Jennifer D. -44.95
Expense Accounts:Rhodes, Robert C. 1,654.03
Lines of Credit:American Express Centurian
Bank 9,661.65
Lines of Credit:Textron PurchaseLine 23,732.14
Payroll Liabilities:401K Contributions -2,055.52
Payroll Liabilities:Accrued Payroll (not
paid) 13,000.00
Payroll Liabilities:Section 125 - Cafeteria
Plan -2,043.12
Sales Tax Payable 745.66
---------------
Net cash provided by Operating Activities -114,177.63
INVESTING ACTIVITIES
Notes to officers:Note - #1 RCR 30,757.50
Notes to officers:Note - #3 Patrick L. Anderson -20,000.00
---------------
Net cash provided by Investing Activities 10,757.50
FINANCING ACTIVITIES
LT Loans:Ford Credit - 2001 Towncar -5,379.30
LT Loans:Sterling Bank Term Loan (LOC) -35,475.09
Capital Stock 69,140.00
Retained Earnings 43,318.00
---------------
Net cash provided by Financing Activities 71,603.61
---------------
Net cash increase for period -31,816.52
Cash at beginning of period 31,610.70
-----------------
Cash at end of period -205.82
=================
Jul - Sep 03
---------------
OPERATING ACTIVITIES
Net Income -92,483.08
Adjustments to reconcile Net Income to net
cash provided by operations:
Accounts Receivable 16,910.71
Accounts Payable 36,534.80
American Express:AMEX - JDM -204.42
American Express:AMEX - RCR -3,365.40
Expense Accounts:Anderson, Patrick L. 6,778.07
Expense Accounts:Cooley, Carey -1,000.00
Expense Accounts:Rhodes, Robert C. 1,985.73
Expense Accounts:Todd, Jennifer V. 90.05
Expense Accounts:Zhou, Linda 4,000.00
Lines of Credit:American Express Centurian
Bank 4,483.88
Lines of Credit:Textron PurchaseLine 23,732.14
Payroll Liabilities:401K Contributions -1,700.48
Payroll Liabilities:Accrued Payroll (not
paid) 13,000.00
---------------
Net cash provided by Operating Activities 8,762.00
INVESTING ACTIVITIES
Notes to officers:Note - #1 RCR 14,136.14
---------------
Net cash provided by Investing Activities 14,136.14
FINANCING ACTIVITIES
LT Loans:Ford Credit - 2001 Towncar -1,613.79
LT Loans:Sterling Bank Term Loan (LOC) -9,400.00
---------------
Net cash provided by Financing Activities -11,013.79
---------------
Net cash increase for period 11,884.35
Cash at beginning of period -12,090.17
---------------
Cash at end of period -205.82
===============
Jan - Sep 03
---------------
Ordinary Income/Expense
Income
Consulting 482,599.82
Monthly Recurring 8,373.00
Other Regular Income 67,956.85
Product Sales
Course Manuals 3,150.00
---------------
Total Product Sales 3,150.00
Reimbursed Expenses 1,750.23
Training 800.00
---------------
Total Income 564,629.90
Cost of Goods Sold
Cost of Goods Sold 21,753.19
---------------
Total COGS 21,753.19
---------------
Gross Profit 542,876.71
Expense
Automobile Expense
Gas Expense 1,317.80
Mileage 1,080.74
Servicing 108.38
---------------
Total Automobile Expense 2,506.92
Bank Service Charges 1,655.15
Certification & Education
Dues 4,563.59
Education 500.00
Subscriptions 709.97
---------------
Total Certification & 5,773.56
Education
Computers
Computer Lease 5,407.34
Hardware 2,559.22
Software 1,334.89
---------------
Total Computers 9,301.45
Contributions 108.25
Insurance
Liability Insurance 370.80
Insurance - Other 3,269.92
---------------
Total Insurance 3,640.72
Interest Expense 9,211.70
Office Expense
Postage and Delivery 2,259.88
Printing and Reproduction 5,694.61
Rent 26,916.87
Supplies 10,476.37
---------------
Total Office Expense 45,347.73
Payroll Expenses
401K Company Contribution 5,586.09
Benefits 918.84
Subcontract Labor 236,638.85
Wages, PEO 432,891.47
---------------
Total Payroll Expenses 676,035.25
Professional Fees
Accounting 925.00
Legal Fees 15,705.00
Payroll service 3,977.50
Professional Fees - Other 2,049.95
---------------
Total Professional Fees 22,657.45
Sales & Marketing 800.26
Taxes
Federal 377.37
Property Tax 3,121.58
Taxes - Other 42.45
---------------
Total Taxes 3,541.40
Travel & Ent
Entertainment 2,490.56
Meals - 100% deductable 6,531.87
Meals - 50% deductable 6,683.34
Travel 7,610.80
Travel & Ent - Other 813.72
---------------
Total Travel & Ent 24,130.29
Utilities
Internet Access 14,501.62
Telephone 3,583.43
Telephone - Cellular 4,790.81
---------------
Total Utilities 22,875.86
---------------
Total Expense 827,585.99
---------------
Net Ordinary Income -284,709.28
Other Income/Expense
Other Income
Interest Income 103.14
Other Income 775.85
---------------
Total Other Income 878.99
Other Expense
Other Expenses
Bad A/R 4,775.71
Other Expenses - Other 9,106.33
---------------
Total Other Expenses 13,882.04
---------------
Total Other Expense 13,882.04
---------------
Net Other Income -13,003.05
---------------
Net Income -297,712.33
===============
Jul - Sep 03
----------------
Ordinary Income/Expense
Income
Consulting 184,909.55
Monthly Recurring 2,289.70
Other Regular Income 4,981.96
Training 800.00
----------------
Total Income 192,981.21
Cost of Goods Sold
Cost of Goods Sold 4,381.97
----------------
Total COGS 4,381.97
----------------
Gross Profit 188,599.24
Expense
Automobile Expense
Gas Expense 521.15
Mileage 608.48
Servicing 34.44
----------------
Total Automobile Expense 1,164.07
Bank Service Charges 316.25
Certification & Education
Dues 149.00
----------------
Total Certification & 149.00
Education
Computers
Computer Lease 2,362.58
Hardware 959.38
Software 166.42
----------------
Total Computers 3,488.38
Insurance 568.27
Interest Expense 4,389.13
Office Expense
Postage and Delivery 194.22
Printing and Reproduction 26.37
Rent 9,998.73
Supplies 647.84
----------------
Total Office Expense 10,867.16
Payroll Expenses
401K Company Contribution 742.70
Subcontract Labor 91,635.36
Wages, PEO 139,015.38
----------------
Total Payroll Expenses 231,393.44
Professional Fees
Legal Fees 8,500.00
Payroll service 700.00
Professional Fees - Other 99.95
----------------
Total Professional Fees 9,299.95
Travel & Ent
Entertainment 326.94
Meals - 100% deductable 3,608.81
Meals - 50% deductable 1,764.80
Travel 1,510.17
----------------
Total Travel & Ent 7,210.72
Utilities
Internet Access 4,346.29
Telephone 1,155.34
Telephone - Cellular 1,958.61
----------------
Total Utilities 7,460.24
----------------
Total Expense 276,306.61
----------------
Net Ordinary Income -87,707.37
Other Income/Expense
Other Expense
Other Expenses
Bad A/R 4,775.71
----------------
Total Other Expenses 4,775.71
----------------
Total Other Expense 4,775.71
----------------
Net Other Income -4,775.71
----------------
Net Income -92,483.08
================
Exhibit 31.1
Certification Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002
I, Robert C. Rhodes, certify that:
1. I have reviewed the quarterly report on Form 10-QSB of Systems
Evolution, Inc. for the period ended September 30, 2003 (this
"Report");
2. Based on my knowledge, this Report does not contain any untrue statement of
a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
Report;
3. Based on my knowledge, the financial statements, and other financial
information included in this Report, fairly present in all material
respects the financial condition, results of operations and cash flows of
the registrant as of, and for, the periods presented in this Report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
(a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities,
particularly during the period in which this Report is being prepared;
(b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
Report (the "Evaluation Date"); and
(c) presented in this Report our conclusions about the effectiveness of the
disclosure controls and procedures based on our evaluation as of the
Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors:
(a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and
(b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and
6. The registrant's other certifying officers and I have indicated in this
Report whether or not there were significant changes in internal controls
or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any
corrective actions with regard to significant deficiencies and material
weaknesses.
Dated: December 22, 2003
/S/
- --------------------------------------
Robert C. Rhodes, CEO
Exhibit 31.2
Certification Pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002
I, Robert C. Rhodes, certify that:
7. I have reviewed the quarterly report on Form 10-QSB of Systems
Evolution, Inc. for the period ended September 30, 2003 (this
"Report");
8. Based on my knowledge, this Report does not contain any untrue statement of
a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
Report;
9. Based on my knowledge, the financial statements, and other financial
information included in this Report, fairly present in all material
respects the financial condition, results of operations and cash flows of
the registrant as of, and for, the periods presented in this Report;
10. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
(d) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities,
particularly during the period in which this Report is being prepared;
(e) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
Report (the "Evaluation Date"); and
(f) presented in this Report our conclusions about the effectiveness of the
disclosure controls and procedures based on our evaluation as of the
Evaluation Date;
11. The registrant's other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors:
(c) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and
(d) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal
controls; and
12. The registrant's other certifying officers and I have indicated in this
Report whether or not there were significant changes in internal controls
or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any
corrective actions with regard to significant deficiencies and material
weaknesses.
Dated: December 22, 2003
/S/
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Robert C. Rhodes, CFO
Exhibit 32
Certification Pursuant to 18U.S.C Section 1350, as Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
Each of the undersigned hereby certifies, for the purposes of section 1350 of
chapter 63 of title 18 of the United States Code, in his capacity as an officer
of Systems Evolution, Inc. ("Systems Evolution"), that, to his knowledge, the
quarterly report on Form 10-QSB of Systems Evolution, Inc. for the period ended
September 30, 2003, fully complies with the requirements of Section 13(a) of the
Securities Exchange Act of 1934 and that the information contained in such
amendment to said report fairly presents, in all material respects, the
financial condition and results of operation of Systems Evolution.
Dated: December 22, 2003
/S/
- --------------------------------------
Robert C. Rhodes, CEO
/S/
- --------------------------------------
Robert C. Rhodes, CFO