UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q /A

   X  . QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended February 28, 2011

       . TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to ___________

Commission File Number: 000-53446

ABSOLUTE LIFE SOLUTIONS, INC.

(Exact name of registrant as specified in its charter)

Nevada		71-1013330
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
45 Broadway New York, New York		10006
(Address of principal executive offices)		(Zip Code)
(212) 201-4070
(Registrant's telephone number, including area code)

__________________________________________

(Former name or former address, if changed since last report)

Indicate by check mark whether the registrant (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      ..

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes      . No      ..

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer," "non-accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	.	Accelerated filer	.
Non-accelerated filer	. (Do not check if a smaller reporting company)	Smaller reporting company	X .

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes      . No   X  .

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date. 82,873,928 shares of common stock as of April 7, 2011.

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Explanatory Note –

Absolute Life Solutions, Inc  (the “Company”) is filing this amendment to its Quarterly Report on Form 10-Q for the quarterly  period ended February 28, 2011, which was originally filed with the Securities and Exchange Commission (“SEC”) on April 8, 2011 (the “Original Filing”), to amend the information regarding Subsequent Events  described in Note 9 to the financial statements.

This Form 10-Q/A amends the following items in the Company’s Original Filing:

Part I – Item 1 –Financial Statements

Part II – Item 6 – Exhibits

For the convenience of the reader, this Form 10-Q/A sets forth the Quarterly Report on Form 10-Q in its entirety. Other than as described above, none of the other disclosures in the Original Filing have been amended or updated. Among other things, forward-looking statements made in the Original Filing have not been revised to reflect events that occurred or facts that became known to the Company after the filing of the Original Filing, and such forward-looking statements should be read in their historical context. Accordingly, this Form 10-Q/A should be read in conjunction with the Company’s subsequent filings to the Original Filing with the SEC.

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ABSOLUTE LIFE SOLUTIONS, INC.

Quarterly Report On Form 10-Q

For The Quarterly Period Ended

February 28, 2011

INDEX

			Page(s)
PART I - FINANCIAL INFORMATION
	Item 1.	Financial Statements	4
	Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	17
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	20
	Item 4.	Controls and Procedures	20
PART II - OTHER INFORMATION
	Item 1.	Legal Proceedings	20
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	21
	Item 3.	Defaults Upon Senior Securities	21
	Item 5.	Other Information	21
	Item 6.	Exhibits	21

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Item 1. Financial Statements

The following unaudited interim financial statements of Absolute Life Solutions, Inc. (sometimes referred to as "we", "us" or "our Company") are included in this quarterly report on Form 10-Q:

	Page
Balance Sheets	5
Statements of Operations	6
Statements of Cash Flows	7
Notes to Financial Statements	8

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ABSOLUTE LIFE SOLUTIONS, INC. CONDENSED BALANCE SHEETS
			February 28, 2011		August 31, 2010
			(unaudited)
ASSETS
Current Assets
	Cash	$	2,413,736	$	3,498,525
	Insurance purchase escrow		2,650,000		2,200,000
	Prepaid expenses		101,195		87,651
Total current assets			5,164,931		5,786,176
Equipment, net			102,058		114,036
Security deposit			56,688		56,688
Investment in life settlement contracts			62,331,953		12,313,897
TOTAL ASSETS		$	67,655,630	$	18,270,797
LIABILITIES
Current Liabilities
	Accounts payable and accrued expenses	$	45,442	$	362,896
	Income taxes payable		63,213		-
Total Current Liabilities			108,655		362,896
Deferred income taxes			15,286,796		1,524,558
TOTAL LIABILITIES			15,395,451		1,887,454
Contingencies and commitments
STOCKHOLDERS' EQUITY
	Preferred stock ($0.00001 par value; 100,000,000 authorized;
	of which 60,000 are designated as Series A
	12.5% convertible preferred stock;
	32,700 Series A issued and outstanding)
	(August 31, 2010 – 13,500 issued and outstanding)		33		14
	Common stock ($0.00001 par value; 500,000,000 authorized;
	82,873,928 issued and outstanding)
	(August 31,2010 - 80,060,000 issued and outstanding)		829		801
	Additional paid-in capital		55,786,424		14,249,924
	Retained Earnings (accumulated deficit)		(3,527,107)		2,132,604
Total Stockholders’ Equity			52,260,179		16,383,343
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY		$	67,655,630	$	18,270,797
The accompanying notes are an integral part of these condensed financial statements

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ABSOLUTE LIFE SOLUTIONS, INC.
CONDENSED STATEMENTS OF OPERATIONS
UNAUDITED
		Three months ended February 28, 2011		Three months ended February  28, 2010		Six  Months  ended February  28, 2011		Six  months ended February  28, 2010
Sales, general and administrative expenses	$	(708,814)	$	(7,314)	$	(1,778,661)	$	(18,164)
Other income
Unrealized gain on investment in life settlement contracts net of premiums paid		10,742,217		-		29,192,918		-
Realized gain on maturity of life settlement contract		-		-		2,237,500		-
Income (loss) before income tax		10,033,403		(7,314)		29,651,757		(18,164)
Income tax provision		(5,251,490)		-		(13,825,451)		-
Net Income (loss)		4,781,913		(7,314)		15,826,306		(18,164)
Deemed Dividend on Series A Preferred Stock		(5,950,000)		-		(19,200,000)		-
Dividend on Convertible Preferred Stock		(2,286,018)		-		(2,286,018)		-
Net loss applicable to common shareholders	$	(3,454,105)	$	(7,314)	$	(5,659,712)	$	(18,164)
Basic earnings (loss) per common share	$	(.04)	$	.00	$	(.06)	$	.00
Diluted earnings (loss) per common share	$	(.04)	$	.00	$	(.06)	$	.00
Basic weighted average number of shares outstanding		88,243,904		80,060,000		87,827,881		80,060,000
Diluted weighted average number of shares outstanding		88,243,904		80,060,000		87,827,881		80,060,000
The accompanying notes are an integral part of these condensed financial statements

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ABSOLUTE LIFE SOLUTIONS INC.

NOTES TO THE FINANCIAL STATEMENTS (UNAUDITED)

February 28, 2011

1. NATURE AND CONTINUANCE OF OPERATIONS

Shimmer Gold, Inc was incorporated in the State of Nevada on September 7, 2006 and was in the business of the acquisition and exploration of mineral resources.

On May 21, 2010, the Company changed its name from Shimmer Gold, Inc. to Absolute Life Solutions, Inc. (the “Company”). During the fiscal year ended August 31, 2010, the Company commenced operations as a specialty financial services company engaged in the business of purchasing life settlement contracts for long-term investment purposes.

The continued existence of the Company is dependent upon its ability to generate profit from its life settlement investments and to meet its obligations as they become due. If additional cash is needed, the Company intends to finance the future capital required to acquire life settlement contracts and continued operations from a combination of traditional debt and equity markets. However, there is no assurance that (a) traditional debt and equity markets may be accessible as required, or if so, on acceptable terms and, or (b) the demand for and selling prices of the Company’s products, may not be sufficient to meet cash flow expectation. The outcome of these matters cannot be predicted with certainty and therefore the Company may not be able to continue or expand operations as planned. These unaudited condensed 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.

2. SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited condensed financial statements as of February 28, 2011 and 2010 and for the three and six months then ended have been prepared in accordance with the accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and pursuant to the instructions to Form 10-Q and Article 8 of Regulation S-X of the Securities and Exchange Commission (“SEC”) and on the same basis as the annual audited financial statements. The unaudited Condensed Balance Sheet as of February 28, 2011, Condensed Statements of Operations for the three and six months ended February 28, 2011 and 2010, and Condensed Statements of Cash Flows for the six months ended February 28, 2011 and 2010, are unaudited, but include all adjustments, consisting only of normal recurring adjustments, which the Company considers necessary for a fair presentation of the financial position, operating results and cash flows for the period presented. The results for the three and six months ended February 28, 2011 are not necessarily indicative of results to be expected for the year ending August 31, 2011 or for any future interim period. In addition, the balance sheet data at August 31, 2010 was derived from the audited financial statements but does not include all disclosures required by GAAP. The accompanying condensed financial statements should be read in conjunction with the Company’s financial statements and notes thereto included in the Company’s Annual Report on Form 10-K/A, which was filed with the SEC on January 7, 2011.

Use of Estimates

The preparation of financial statements in conformity with GAAP 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. The Company regularly evaluates estimates and assumptions. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company's estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. The most significant estimates with regard to these financial statements relate to deferred income tax amounts and rates and timing of the reversal of income tax differences, the fair value of financial instruments and the determination of the variables used in the calculation of the fair value of Life Settlement contracts.

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Life Settlement Contracts

ASC 325-30, Investments in Insurance Contracts allows an investor to elect to account for its investments in life settlement contracts using either the investment method or the fair value method. The election shall be made on an instrument-by instrument basis and is irrevocable. Under the investment method, an investor shall recognize the initial investment at the purchase price plus all initial direct costs. Continuing costs (policy premiums and direct external costs, if any) to keep the policy in force shall be capitalized. Under the fair value method, an investor shall recognize the initial investment at the purchase price. In subsequent periods, the investor shall re-measure the investment at fair value in its entirety at each reporting period and shall recognize the change in fair value in the current period net of premiums paid. The Company uses the fair value method to account for Life Settlement contracts.

The Company will recognize the difference between the death benefits and the carrying value of the policy when the Company determines that settlement and ultimate collection is realizable and reasonably assured. Revenue from a transaction must meet both criteria in order to be recognized. Revenue is generally considered realized when cash is received for the sale of a product or performance of a service. Revenue generally becomes realizable when a promise to pay is received in exchange for the sale of a product or performance of a service. The promise to pay could be verbal (account receivable) or written (note receivable). Revenue is generally earned when a legally enforceable exchange takes place (e.g., consideration has been tendered and the buyer takes possession of the product or benefits from the performance of a service). The Company recognizes gains (revenue) from life insurance contract that the company owns upon one of the two following events:

1) Receipt of death notice or verified obituary of insured

2) Sale of policy and filing of change of ownership forms and receipt of payment

Financial Instruments

The fair value of certain of the Company's financial instruments, consisting of cash, accounts payable, and accrued expenses are estimated to be equal to their carrying value due to the short-term nature of these instruments. Investments in Life Settlement contracts are classified as held-for-trading and measured at fair value, with the realized and unrealized changes in fair value recognized each reporting period in the statements of operations.

The Company measures the fair value of financial assets and liabilities based on the guidance of ASC 820 “Fair Value Measurements and Disclosures” which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements.

ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value:

Level 1 — quoted prices in active markets for identical assets or liabilities

Level 2 — quoted prices for similar assets and liabilities in active markets or inputs that are observable

Level 3 — inputs that are unobservable (for example cash flow modeling inputs based on assumptions)

It is management's opinion that the Company is not exposed to significant interest, currency and credit risks arising from these financial instruments. (See Note 7).

Earnings (Loss) per Share

Basic earnings (loss) per share is calculated using the weighted average number of shares of common stock outstanding during the period. Included in basic loss per share calculations are the effects of 6,000,000 warrants exercisable at $.01. Diluted earnings per share reflect the potential dilution that could occur if potentially dilutive securities were exercised or converted to common stock.  The dilutive effect of options and warrants and their equivalent is computed by application of the treasury stock method and the effect of convertible securities by the “if converted” method.  16,350,000 warrants with an exercise price of $2.00 and 32,700,000 Series A preferred shares, convertible into 32,700,000 common shares are not included in diluted earnings per share since their effect would be anti-dilutive.

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Recent Accounting Pronouncements

The FASB has issued Accounting Standards Update (ASU) No. 2010-15, Financial Services—Insurance (Topic 944): How Investments Held through Separate Accounts Affect an Insurer’s Consolidation Analysis of Those Investments.  This ASU codifies the consensus reached in EITF Issue No. 09-B, "Consideration of an Insurer's Accounting for Majority-Owned Investments When the Ownership Is through a Separate Account." The amendments clarify that an insurance entity generally should not consider any separate account interests held for the benefit of policy holders in an investment to be the insurer's interests and should not combine those interests with its general account interest in the same investment when assessing the investment for consolidation. The general guidance does not apply in instances where the separate account interests are held for the benefit of a related party policy holder as defined in the Variable Interest Entities Subsections of Codification Topic 810, Consolidation,  Subtopic 810-10, as those Subsections require the consideration of related parties. ASU 2010-15 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2010. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company’s financial position and results of operations.

 

Other pronouncements issued by the FASB or other authoritative accounting standards groups with future effective dates are either not applicable or are not expected to be significant to the financial statements of the Company.

3. INVESTMENT IN LIFE SETTLEMENT CONTRACTS

The Company purchases Life Settlement contracts for long-term investment purposes and uses the fair value method to calculate its Life Settlement portfolio.

When using fair value to measure assets and liabilities that are not actively trading, the Company follows the principles that clarify methods for measuring fair value when pricing these assets and liabilities. Further, the Company follows standards for the fair value option, which permits all entities to choose to measure eligible items at fair value at specified election dates. These standards state that a business entity shall report unrealized gains and losses on items for which the fair value option has been elected in earnings at each subsequent reporting date.

As of February 28, 2011 and August 31, 2010, the Company has the following investments in Life Settlement contracts:

	Number of contracts	Estimated fair value	Face value
2August 31, 2010	5	$    12,313,897	$        40,000,000
February 28, 2011	26	$    62,331,953	$      178,638,580

Number of contracts	Life Expectancies		Face value		Carrying Value
-	0-1 Years	$	-	$	-
-	1-2 Years	$	-	$	-
1	2-3 Years	$	10,000,000	$	5,603,898
2	3-4 years	$	13,000,000	$	5,813,704
3	4-5 Years	$	31,000,000	$	14,680,005
20	Thereafter	$	124,638,580	$	36,234,346

For the three and six months ending February 28, 2011, the investments experienced an unrealized gain net of premiums paid of $10,742,217 and $29,192,918, respectively (2010 - $nil.) During these same periods, the Company recognized a realized gain of $0 and $2,237,500, respectively (2010- $nil).

Included in insurance purchase escrow is $2,650,000 towards the purchase of Life Settlement contracts, which were held in escrow at February 28, 2011 (August 31, 2010 - $2,200,000). Funds are placed into escrow when the Company has made an offer for the acquisition of a Life Settlement policy or is contemplating making an offer.

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The fair value of Life Settlement contracts is based on information available to the Company at period end. The Company considers the following factors in its fair value estimates: cost at date of purchase; recent purchases and sales of similar investments, financial standing of the issuer, changes in economic conditions affecting the issuer; standard actuarially developed mortality tables and industry life expectancy reports. The company uses life expectancy reports that have been issued no later than 24 months from the ending date of the quarter being reported. Life expectancy reports are currently ordered from any two of the following life expectancy providers; AVS, 21 ^st  Century, EMSI, ISC, and Fasano. The company considers that the underlying methodology of the life expectancy providers is an adequate gauge for calculating health status of the individual insured. Life expectancy data is used to simulate random possibilities of maturity, which form the basis for a statistical calculation that underlies our market valuations.

The fair value of the Life Settlement contracts are estimated using present value calculations. The following assumptions were used at February 28, 2011 and August 31, 2010:

Dataset	VBT ALB Mortality Table
Expected premium growth	5%
Mortality rates	Standard life expectancy
Discount rate	11.8%

The result of applying these assumptions and using Monte Carlo simulations for the quarter ended February 28, 2011 is as follows:

Total Pool Benefit	$	178,638,580
Average predicted period until final pool maturity		8.15
Average simulated maturities over age 90		41%
Average age at February 28, 2011		80.31
Average age at maturity		88.26
Premiums paid to date		2,234,088

The assumptions are, by their nature, inherently uncertain and the effect of changes in estimates may be significant. The fair value measurements used in estimating the present value calculations are derived from valuation techniques that include inputs for the asset that are not based on observable market data. The risks associated with the investments in life settlement contracts arise from the unknown remaining life expectancy, a change in credit worthiness of the policy issuer, funds needed to maintain the asset, and changes in the discount rate (See Note 7).

4. PREFERRED STOCK

The total number of preferred shares authorized and that may be issued by the Company is 100,000,000 preferred shares with a par value of $0.00001. These preferred shares have no rights to dividends, voting, profit sharing or liquidation.

Of the total preferred shares authorized, pursuant to a Certificate of Designation dated July 22, 2010, 60,000 preferred shares have been designated as Series A 12.5% convertible preferred stock, with a par value of $0.00001. During the six month period ended February 28, 2011, the Company issued 19,200 (2010 – Nil) shares of Series A convertible preferred stock. In connection with the issuance of each Series A convertible preferred stock, the Company issued 1,000 warrants. Each warrant entitles the holder to purchase one share of common stock at exercise prices  ranging from $2.00 - $4.00 per share of common stock.

These Series A convertible preferred shares were issued at $1,000 per share and each Series A convertible share is convertible into 1,000 shares of common stock at an initial conversion price of $1.00 per share. The Series A convertible preferred shares are convertible at the election of the holder. The conversion right is effective beginning on the earlier of 65 days after the initial issuance of the shares to the holder or the effective date of a registration statement filed by the Company covering the holder’s resale of the conversion shares. The earlier of the two dates will be the Conversion Date.

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The holders of the shares of Series A preferred stock have the right to redeem the Series A preferred stock only upon existence of a Redemption Event. A Redemption Event is described as:

(a) Failure of the Company to deliver certificates of conversion to the holders for any reason within 15 days after the Conversion Date and the holder has given 5 days’ notice thereof;

(b) A change in beneficial ownership of more than 50% of the common stock of the Company within a period of 40 trading days or involuntary change in a majority of the members of the Board of Directors of the Company within a period of 40 days; or

(c) Bankruptcy, reorganization, insolvency or liquidation proceedings which are not dismissed within 60 days.

If the holder redeems the Series A preferred shares, the Company will be obligated to pay the holder a redemption amount equal to the sum of (i) the stated value of the redeemed shares multiplied by  102%, if the  redemption occurs within  5 years  from the  initial issuance;  (ii) or by  100% if  the redemption occurs after the 5 years. In addition, upon redemption, the Company must pay unpaid dividends through the date of such payment.

Each share of Series A preferred stock is entitled to receive a dividend at the rate of 12.5% per annum.  Dividends are payable, at the option of the Company, in cash or in common  stock. Dividends are payable semi-annually on the last day of June and December, with the first dividend payment date being December 31, 2010. On January 18, 2011 the Company paid dividends due on December 31, 2010 with the issuance of 993,921 shares of common stock valued at $2,286,018.  

During the six months ended February 28, 2011, the issuance of the Series A Preferred Shares with a contractual conversion price of $1.00 resulted in an effective conversion price lower than the fair market value of the Company’s Common Stock at each issuance after allocating the proceeds received to the preferred shares and the detachable warrants included with the preferred shares.  Accordingly,  the Company recorded deemed dividends in the aggregate amount of $19,200,000  attributable to the beneficial conversion feature in connection with the private placement of the 19,200 Series A preferred shares issued in the period.

5. COMMON STOCK

A.

During the year ended August 31, 2010, the Company effected a 10:1 forward stock split of its authorized, issued and outstanding common stock. All share amounts have been retroactively adjusted for all periods presented.

Effective June 1, 2010, the Company adopted an Equity Incentive Plan (the “Plan”), whereby the Company has reserved for issuance up to 10,000,000 shares of its common stock.  The purpose of the Plan is to provide directors, officers and employees of, and consultants, to the Company with additional incentives by increasing their ownership in the Company. Directors, officers, Employees and consultants of the Company are eligible to participate in the Plan. Options in the form of Incentive Stock Options and Non-Statutory Stock Options may be granted under the Plan. Restricted Stock may also be granted under the Plan. The Company issued on September 7, 2010 850,000 shares of restricted stock which were granted on July 9, 2010 to officers and directors with a grant date fair value of approximately $85,000.

In connection with the Common Stock Purchase Agreement dated January 15, 2010 between Belmont Partners, LLC, the then principal stockholder of the Company, and YSY Enterprises, Inc., on September 7, 2010 the Company issued an additional 565,000 (post-split) shares of common stock to an assignee of Belmont in settlement of shares to be issued at closing for the achievement of certain conditions at the time of closing.

During the six month period ended February 28, 2011 the Company issued 355,007 shares for consulting agreements to arms-length parties for various consulting services. The aggregate share value was $745,515.

During the six month period ended February 28, 2011 the Company issued 50,000 shares for Board of Directors. The aggregate share value was $105,000.

During the six month period ended February 28, 2011 the Company issued 993,921 shares of common stock as payment for the 12.5% dividend on the Series A Preferred stock. These shares were valued at $2,286,018

B.

During the six month period ended February 28, 2011, the Company also issued 19,200,000 warrants pursuant to the issuance of 19,200 Series A convertible preferred shares (Note 6).

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Warrant transactions are summarized as follows:

	Number of warrants	Weighted average exercise price	Weighted average life remaining (in years)
Balance as at August 31, 2010
Issued	19,500,000	2.08	5 years
Additions as of February 28, 2011
Issued	19,200,000	-	5 years
Balance as at February 28, 2011	38,700,000	2.54	4.74 years

The following warrants were outstanding and exercisable at February 28, 2011:

Number of warrants	Exercise price	Expiration date
6,000,000 2,500,000 2,500,000 2,500,000 2.500,000 1,750,000 1,750,000 1,500,000 1,500,000 2,000,000 2,000,000 500,000 500,000 1,250,000 1,250,000 125,000 125,000 750,000 750,000 500,000 500,000	.01 2.00 4.00 2.00 4.00 2.00 4.00 2.00 4.00 2.00 4.00 2.00 4.00 2.00 4.00 2.00 4.00 2.00 4.00 2.00 4.00	June 15, 2015 July 22, 2015 July 22, 2015 August 9, 2015 August 9, 2015 August 31, 2015 August 31, 2015 September 27, 2015 September 27, 2015 October 14, 2015 October 14, 2015 October 25, 2015 October 25, 2015 November 3, 2015 November 3, 2015 November 3, 2015 November 3, 2015 November 5, 2015 November 5, 2015 November 30, 2015 November 30, 2015
225,000	2.00	December 21, 2015
225,000 125,000	4.00 2.00	December 21, 2015 December 22, 2015
125,000 125,000	4.00 2.00	December 22, 2015 January 25, 2016
125,000 500,000	4.00 2.00	January 25, 2016 January 25, 2016
500,000 650,000	4.00 2.00	January 25, 2016 January 31, 2016
650,000 125,000	4.00 2.00	January 31, 2016 February 11, 2016
125,000 125,000	4.00 2.00	February 11, 2016 February 18, 2016
125,000 600,000	4.00 2.00	February 18, 2016 February 28, 2016
600,000 500,000	4.00 2.00	February 28, 2016 February 28, 2016
500,000	4.00	February 28, 2016
38,700,000

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6. COMMITMENTS

 Life insurance premiums are future payments required to keep the insurance policies, comprising the Company’s investment in Life Settlement contracts, intact. At February 28, 2011, the premiums to be paid for each of the five succeeding years are as follows:

Year		Amount
2011	$	3,261,883
2012		10,904,734
2013		11,122,947
2014		11,338,268
2015		11,548,648
Thereafter		162,641,869
	$	210,818,349

7. FAIR VALUE OF FINANCIAL INSTRUMENTS

The following table provides an analysis of Level 3 financial instruments that are re-measured subsequent to initial recognition at fair value. The Company determined that its investment in life settlements is a level 3 financial instrument and that it has no level 1 or level 2 financial instruments:

Reconciliation of Level 3 fair value measurements of financial assets on a recurring basis using unobservable inputs as of February 28, 2011:

Unquoted Life Settlement policies
Beginning balance	$	12,313,897
Transfers in:
Purchases of life settlement contracts		19,118,000
Unrealized gain		31,162,556
Transfers out:
Carrying value of matured contract		(262,500)
Ending balance	$	62,331,953

8. INCOME TAXES

Income tax expense:

		2011		2010
Current	$	63,213	$	-
Deferred		13,762,238		1,524,558
Income tax provision	$	13,825,451	$	1,524,558

The Company calculates its interim tax provision in accordance with the provisions of ASC 740-270, “Income Taxes; Interim Reporting.” For interim periods, the Company estimates its annual effective income tax rate and applies the estimated rate to the year-to-date income or loss before income taxes. The Company also computes the tax provision or benefit related to items we report separately and recognizes the items net of their related tax effect in the interim periods in which they occur. The Company also recognizes the effect of changes in enacted tax laws or rates in the interim periods in which the changes occur.

In computing the annual estimated effective tax rate the Company makes certain estimates and judgments, such as estimated annual taxable income or loss, the nature and timing of permanent and temporary differences between taxable income for financial reporting and tax reporting, and the recoverability of deferred tax assets. These estimates and assumptions may change as new events occur, additional information is obtained, or as the tax environment changes. The difference between the statutory rate of 35% and the effective rate of 47% is primarily attributable to the affect of state and local taxes.

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As of August 31, 2010, we have approximately $318,000 of federal and state net operating loss carry-forwards, available to offset future taxable income, if any. Deferred tax liabilities represent the difference between the financial reporting and income tax bases of life settlement contracts.

As of February 28, 2011 The Company has not filed income tax returns since inception in the United States and Canada. Both taxing authorities prescribe penalties for failing to file certain tax returns and supplemental disclosures. Upon filing there could be penalties and interest assessed. Such penalties vary by jurisdiction and by assessing practices and authorities. As the Company has incurred losses since inception there would be no known or anticipated exposure to penalties for income tax liability. However, certain jurisdictions may assess penalties for failing to file returns and other disclosures and for failing to file other supplementary information associated with foreign ownership, debt and equity positions. Inherent uncertainties arise over tax positions taken with respect to transfer pricing, related party transactions, tax credits, tax based incentives and stock based transactions. Management has considered the likelihood and significance of possible penalties associated with its current and intended filing positions and has determined, based on their assessment, that such penalties, if any, would not be expected to be material.

9. SUBSEQUENT EVENTS

Subsequent to the end of the quarter, the Company sold an additional 250 shares of Series A Preferred Stock . Additionally, on April 7, 2011, we entered into a Securities Purchase Agreement (the "Securities Purchase Agreement") with a purchaser pursuant to which we sold an aggregate of (i) 7,500 shares of our Series A 12.5% Convertible Preferred Stock (the "Series A Preferred Stock"), which shares of Preferred Stock have a stated value of $1,000 per share and are convertible into shares of our Common Stock at an initial conversion price of $1.00 per share, and (ii) warrants to purchase an aggregate of 7,500,000 shares of common stock (the "Investor Warrants"), half of which are exercisable at an initial exercise price of $2.00 per share and half of which are exercisable at an initial exercise price of $4.00 per share.

In connection with the issuance of the Preferred Stock, we entered into a Registration Rights Agreement with the purchaser, pursuant to which we agreed to use our best efforts to register the shares of common stock underlying the Preferred Stock and the Warrants.

 In connection with the transaction set forth above, the Company also authorized the establishment of  and sale of up to 25,000 shares of  Series B 12½% Convertible Preferred Stock (the "Series B Preferred Stock") which shares have a stated value of $1,000.00 per share and are convertible into shares of Common Stock at an initial conversion price of $1.00 per share.

The holders of  Series B Convertible Preferred Stock will receive warrants to purchase an aggregate of 1,050 shares of Common Stock (the Series B Investor Warrants, 500 of which are exercisable at an initial exercise price of $2.00 per share and 550 of which are exercisable at an initial exercise price of $4.00 per share).  The Series B Investor Warrants have a term of five (5) years.  

In connection with the establishment of the Series B Preferred Stock, which is subordinate to the Series A Preferred Stock in respect of liquidation and redemption, the holders of 6,000 shares of Series A Preferred Stock agreed to exchange their Series A Preferred Stock for Series B Preferred Stock.  As a result, each exchanging Series A holder will receive an additional 50 Series B Warrants exercisable at $4.00 for each share of Preferred Stock so exchanged.   

Additionally, in connection with the Securities Purchase Agreement referred to above, Moshe Oratz, the former President and Chief Executive Officer of the Company, granted transferable divisible options to the Purchaser, and an affiliate of the Purchaser, to collectively purchase 20,000,000 shares of Common Stock at an exercise price of $0.005 per share (the "CS Options") from CS Master Holdings, LLC, a limited liability company of which Mr. Oratz is the sole member and manager. The CS Options are exercisable at any time through April 6, 2016, and contain a provision limiting the beneficial  ownership of the holder in the Company stock to 4.99% at any time.   

The Holders of the Series B Preferred Stock will have registration rights similar to the existing holders of the Series A Preferred Stock.   The holders of the requisite percentage of the Series A Preferred Stock have consented to an extension of the date for the filing of the Registration Statement to June 30, 2011 and to the inclusion of the Common Stock issuable on conversion of the Series B Preferred Stock and on exercise of the additional warrant issued to the exchanging shareholders. The Common Stock underlying the CS Options have no registration rights. To date, the Company has sold 40,450 shares of Series A Preferred Stock, of which holders of 6,000 shares have agreed to exchange for Series B Preferred Stock.  There are currently 34,450 shares of Series A Preferred Stock outstanding.  

The Company evaluates events that have occurred after the balance sheet date through the date the financial statements were publicly available. Based upon the evaluation, the Company did not identify any other recognized or non-recognized subsequent events that would have required adjustment or disclosure in the financial statements.

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Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Special Note:  Certain statements in this quarterly report on Form 10-Q concerning our business prospects or future financial performance, anticipated revenues, expenses, profitability or other financial items, estimates as to size, growth in or projected revenues from the life settlement market, developments in industry regulations and the application of such regulations, expected outcomes of pending or potential litigation and regulatory actions, and our strategies, plans and objectives, together with other statements that are not historical facts, are “forward-looking statements” as that term is defined under the federal securities laws.  All of these forward-looking statements are based on information available to us on the date hereof, and we assume no obligation to update any such forward-looking statements.  You should carefully review the risks described herein and in other documents we file from time to time with the Securities and Exchange Commission, (“ SEC ”), including our Annual Report on Form 10-K/A for the year August 31, 2010 (“ Fiscal 2010 ”), particularly in the sections entitled “Item 1A – Risk Factors” and “Item 7 - Management’s Discussion and Analysis of Financial Condition and Results of Operations.”  

Unless required by law, we undertake no obligation to publicly revise any forward-looking statement to reflect circumstances or events after the date of this Report or to reflect the occurrence of unanticipated events. Shareholders and potential shareholders should, however, review the factors and risks we describe in the reports we will file from time to time with the SEC after the date of this Report. Management cautions that these statements are qualified by their terms and/or important factors, many of which are outside of our control, and involve a number of risks, uncertainties and other factors that could cause actual results and events to differ materially from the statements made, including, but not limited to, the following:

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actual or anticipated fluctuations in our quarterly and annual operating results;

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actual or anticipated product constraints;

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decreased demand resulting from changes in laws;

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product and services announcements by us or our competitors;

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loss of any of our key executives;

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regulatory announcements, proceedings or changes;

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competitive product developments and legal developments;

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any business combination we may propose or complete;

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any financing transactions we may propose or complete; or

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broader industry and market trends unrelated to its performance.

Overview

Shimmer Gold, Inc was incorporated in the State of Nevada on September 7, 2006 and was in the business of the acquisition and exploration of mineral resources.

On May 21, 2010, the Company changed its name from Shimmer Gold, Inc. to Absolute Life Solutions, Inc. (the “Company”). During the fiscal year ended August 31, 2010, the Company commenced operations as a specialty financial services company engaged in the business of purchasing life settlement contracts for long-term investment purposes.

The continued existence of the Company is dependent upon its ability to generate profit from its life settlement investments and to meet its obligations as they become due. If additional cash is needed, the Company intends to finance the future capital required to acquire life settlement contracts and continued operations from a combination of traditional debt and equity markets. However, there is no assurance that (a) traditional debt and equity markets may be accessible as required, or if so, on acceptable terms and, or (b) the demand for and selling prices of the Company’s products, may not be sufficient to meet cash flow expectation. The outcome of these matters cannot be predicted with certainty and therefore the Company may not be able to continue or expand operations as planned. These unaudited condensed 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.

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Critical Accounting Estimates, Assumptions and Policies

 

Our discussion and analysis of financial condition and results of operations are based on our condensed financial statements that were prepared in accordance with accounting principles generally accepted in the United States of America.  To guide our preparation, we follow accounting policies, some of which represent critical accounting policies as defined by the SEC.  The SEC defines critical accounting policies as those that are both most important to the portrayal of a company’s financial condition and results and require management’s most difficult, subjective, or complex judgment, often as a result of the need to make estimates about the effect of matters that are inherently uncertain and may change in subsequent periods.  Certain accounting estimates involve significant judgments, assumptions and estimates by management that may have a material impact on the carrying value of certain assets and liabilities, disclosures of contingent liabilities, and the reported amounts of income and expenses during the reporting period that management considers critical accounting estimates.  The judgments, assumptions and estimates used by management are based on historical experience, management’s experience, knowledge of the accounts and other factors that are believed to be reasonable.  Because of the nature of the judgments and assumptions made by management, actual results may differ materially from these judgments and estimates, which could have a material impact on the carrying values of assets and liabilities and the results of our operations.  Areas affected by our estimates and assumptions are identified below.

 

ASC 325-30, Investments in Insurance Contracts, states that an investor may elect to account for its investments in life settlement contracts using either the investment method or the fair value method.  The election is to be made on an instrument-by instrument basis and is irrevocable.  Under the investment method, an investor is to recognize the initial investment at the purchase price plus all initial direct costs.  Continuing costs (e.g., policy premiums and direct external costs, if any) to keep the policy in force are to be capitalized.  Under the fair value method, an investor recognizes the initial investment at the purchase price.  In subsequent periods, the investor re-measures the investment at fair value in its entirety at each reporting period and recognizes change in fair value earnings (or other performance indicators for entities that do not report earnings) in the period in which the changes occur.  We value all of our investments in life settlement contracts using the fair value method.  As of February 28, 2011 and August 31, 2010, the total of our investment in life settlements held for our own account was valued at $62,331,953 and $12,313,897, respectively.

 

We make estimates of the collectability of insurance proceeds receivable.  The accounts associated with these areas are critical to recognizing the correct amount of revenue in the proper period.  We have not experienced any material changes in our estimates of collectability versus actual results in the current or prior periods.

 

We review the carrying value of the property and equipment for impairment whenever events and circumstances indicate that the carrying value of an asset may not be recoverable from the estimated future cash flows expected to result from its use and eventual disposition.  In cases where undiscounted expected future cash flows are less than the carrying value, an impairment loss is recognized equal to an amount by which the carrying value exceeds the fair value of assets.  The factors considered by management in performing this assessment includes current operating results, trends and prospects, the manner in which the property is used, and the effects of obsolescence, demand, competition and other economic factors.  Based on this assessment, there was no impairment during the three months ended February 28, 2011.

 

We evaluate the useful lives of our property and equipment to assure that an adequate amount of depreciation is being charged to operations.  Useful lives are based generally on specific knowledge of an asset’s life in combination with the Internal Revenue Service rules and guidelines for depreciable lives for specific types of assets.

  

We are required to estimate our income taxes.  This process involves estimating our current tax exposure together with assessing temporary differences resulting from differing treatment of items for tax and financial reporting purposes.  These differences result in deferred tax assets and liabilities.  We then assess the likelihood that our deferred tax assets will be recovered from future taxable income, and, to the extent we believe that recovery is not likely, we establish a valuation allowance.  To the extent we establish a valuation allowance or increase this allowance in a period, we include a tax provision or reduce our tax benefit in the statements of operations.  We use our judgment to determine our provision or benefit for income taxes, deferred tax assets and liabilities and any valuation allowance recorded against our net deferred tax assets.

 

We cannot predict what future laws and regulations might be passed that could have a material effect on our results of operations.  We assess the impact of significant changes in laws and regulations on a regular basis and update the assumptions and estimates used to prepare our financial statements when we deem it necessary.

 

We have not made any material changes to our critical accounting estimates or assumptions or the judgments affecting the application of those estimates or assumptions.

  

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New Accounting Pronouncements

The FASB has issued Accounting Standards Update (ASU) No. 2010-15, Financial Services—Insurance (Topic 944): How Investments Held through Separate Accounts Affect an Insurer’s Consolidation Analysis of Those Investments. This ASU codifies the consensus reached in EITF Issue No. 09-B, "Consideration of an Insurer's Accounting for Majority-Owned Investments When the Ownership Is through a Separate Account." The amendments clarify that an insurance entity generally should not consider any separate account interests held for the benefit of policy holders in an investment to be the insurer's interests and should not combine those interests with its general account interest in the same investment when assessing the investment for consolidation. The general guidance does not apply in instances where the separate account interests are held for the benefit of a related party policy holder as defined in the Variable Interest Entities Subsections of Codification Topic 810,  Consolidation,  Subtopic 810-10, as those Subsections require the consideration of related parties. ASU 2010-15 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2010. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company’s financial position and results of operations.

 

Other pronouncements issued by the FASB or other authoritative accounting standards groups with future effective dates are either not applicable or are not expected to be significant to the financial statements of the Company.

Comparison of the three and six months ended February 28, 2011 and 2010

 

We reported net income of $4,781,913 and $15,826,306 respectively for the three  and six months ended February 28, 2011 (the “ Second Quarter of this year ”), compared to net loss of $7,314 and 18,164 respectively for the three months and six months ended February 28, 2010 (the “ Second Quarter of last year ”).  The company had limited operations during the six months ended February 28, 2010.

 

Expenses: Operating and administrative expenses increased from $7,314 and $18,164 for the three months and six months ended February 28, 2010 respectively to $708,814 and 1,778,661 for the three  and six months ended February 28, 2011 respectively as the Company retained personnel, leased office space,  and continued active operations. The decrease in expenses from the first quarter to the second quarter 2011 can be attributed to less spending on marketing budgets. Initial payments to marketing projects were made in the first quarter. These were one time charges.

 

Other Income: Total other income increased from $Nil for the three and six months ended February 28, 2010 respectively to $10,742,217 and $31,430,418 for the three  and six months ended February 28, 2011 respectively. Unrealized gains net of premiums paid were $10,742,217 and $29,192,918 for the three and six months ended February 28, 2011, due to fair market valuation of pool policies. Realized gains from the maturity of life settlement policies were $Nil and $2,237,500 for the three and six months ended February 28, 2011.

 

Income Taxes: Income tax expense increased from $Nil for the three and six months ended February 28, 2010 to $5,251,490 and $13,825,451 for the three and six months ended February 28, 2011 respectively . An increase of $13,762,239 in addition to the previous year’s liability of $1,524,558 resulted from recalculation of the fair value of the company’s life settlement portfolio. The deferred tax liability of $15,286,796 is based on our collection of the unrealized gain reflected in our financial statements.

 

Liquidity and Capital Resources

 

Operating Activities: Net cash flows used in operating activities for the six months ended February 28, 2011 was $3,666,789.  Net cash used in Investing Activities was $16,618,000 arising from purchases of life settlement contracts. Net cash provided by financing activities was $19,200,000 from the sales of Series A preferred stock. This resulted in a decrease of cash of $1,084,789. Sources of cash flow resulted primarily from capital raising activities of $19,200,000.

The company establishes and analyzes its premium reserves on a monthly basis. Once an adequate reserve level is met, the company weighs additions to its portfolio based on the future value of the investment and the future impact the premium commitment will have on its liquidity. Since the company is still building a carefully weighted portfolio it must meet future liquidity needs through the issuance of debt instruments and the sale of equity. It is anticipated that as the pool expands and policy mature the resultant cash flows will enable the company to satisfy the company’s liquidity needs though policy maturities.

 

Working Capital and Capital Availability: As of February 28, 2011, we had working capital of $5,056,276.  We expect to raise additional funds to continue to build our portfolio through debt or subsequent equity offerings. During the next twelve months we anticipate that we will not generate significant cash income from operations. We expect to continue to build a portfolio of life settlements that will mature over the following ten year period. While we may derive income from early maturities, the policies will generally have a life expectancy exceeding 3 years. As our portfolio matures, we expect that our capital needs will subside.

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Outlook

 

 We believe our company and our industry are fundamentally sound and well positioned to deal with the current uncertainty in the financial and capital markets.  Our life settlements are not correlated to the financial or commodities markets, which increases their appeal in uncertain times.  Further, we have an adequate amount of cash and cash equivalents.  We carry no operational debt and do not rely on leverage in our capital structure.  We do rely, however, upon the availability of investment capital.  While it is conceivable that a deep financial crisis could diminish the supply of investment capital throughout the economy, our experience during the First Quarter of this year indicates that greater investment capital will be placed in life settlements.  We believe this is due to the fact that returns in life settlements are relatively attractive and not correlated to the performance of the financial markets.

 

Our operating strategy is to increase cash flows generated from operations by increasing revenues while controlling operating and administrative expenses.  We believe that domestic and international demand for life settlements will continue to grow as the prospects for economic conditions remain uncertain and investors look for alternative investments.    On the supply side, we are increasing our advertising and professional awareness marketing to potential sellers of policies and to strengthen our broker network.

 

Off-Balance Sheet Arrangements

 

We did not engage in any off-balance sheet arrangements or transactions.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Item 4. Controls and Procedures.

Disclosure Controls and Procedures.  With the participation of our Chief Executive Officer and Chief Accounting Officer, we have evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”)), as of the end of the period covered by this report.  Based upon such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such periods, our disclosure controls and procedures were not effective due to the material weaknesses noted below, in ensuring that (i) information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms and (ii) information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

 

·

Due to the small size of its staff, the Company did not have sufficient segregation of duties to support its internal control over financial reporting.

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As of February 28, 2010 the Company did not have a separate Audit Committee - the entire Board of Directors acted as the Company's Audit Committee.

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On April 5, 2011 the Board of Directors of the Company formed an Audit Committee.

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The Company experienced difficulty with respect to evaluation, presentation, and disclosure of certain equity transactions and the fair value of financial instruments.

There were no changes in our internal controls over financial reporting during the quarter ended February 28, 2011, that have materially affected, or are reasonable likely to materially affect, our internal control over financial reporting.

PART II—OTHER INFORMATION

Item 1. Legal Proceedings.

The Company is not engaged in any legal proceedings.

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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

During the quarter ended February 28, 2011, we entered into Securities Purchase Agreements with certain purchasers pursuant to which we sold an aggregate of (i)5,950 shares of our Series A Preferred Stock, which shares of Series A Preferred Stock have a stated value of $1,000 per share and are convertible into shares of our Common Stock at an initial conversion price of $1.00 per share, and (ii) warrants to purchase an aggregate of 5,950 shares of common stock, half of which are exercisable at an initial exercise price of $2.00 per share and half of which are exercisable at an initial exercise price of $4.00 per share, which Investor Warrants expire five (5) years after issuance.

Item 3. Defaults Upon Senior Securities.

The Company currently does not have senior securities

Item 5. Other Information.

Item 6. Exhibits.

 

Exhibit Number	Description
31.1	Certification of Chief Executive Officer and Chief Financial Officer  pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Chief Executive Officer and Chief Financial Officer  pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Form 10-Q/A to be signed on its behalf by the undersigned, thereunto duly authorized.

ABSOLUTE LIFE SOLUTIONS, INC.
April 14, 2011	/s/ Avrohom Oratz
	Avrohom Oratz, President , Chief Executive Officer, Treasurer and Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates as in

Signature		Capacity in which signed		Date
/s/ Avrohom Oratz
Avrohom Oratz		President, Chief Executive Officer, Treasurer and Chief Financial Officer (Principal Executive Officer and Principal  Financial Officer)		April 14, 2011

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