UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934

For the quarterly period ended: MARCH 31, 2011

£

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES

AND EXCHANGE ACT OF 1934  

THE ANDINA GROUP, INC.

(Name of Small Business Issuer in its Charter)

179 South 1950 East, Layton UT 84040

 (Address number principal executive offices)

(801) 558-2110

(Issuer’s telephone number)

Check whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities 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.   Yes  R     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 (§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:

THE ANDINA GROUP, INC.

(A Development Stage Company)

BALANCE SHEETS

The accompanying notes are an integral part of these financial statements

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THE ANDINA GROUP, INC.

(A Development Stage Company)

STATEMENTS OF OPERATIONS

For the Three and Nine Months Ended March 31, 2011 and 2010 and the

Period June 17, 2004 (Inception) to March 31, 2011

(Unaudited)

The accompanying notes are an integral part of these financial statements

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THE ANDINA GROUP, INC.

(A Development Stage Company)

STATEMENTS OF CASH FLOWS

For the nine months ended March 31, 2011 and 2010 and the

Period June 17, 2004 (Inception) to March 31, 2011

(Unaudited)

The accompanying notes are an integral part of these financial statements

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THE ANDINA GROUP, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

March 31, 2011

(UNAUDITED)

1.

ORGANIZATION AND BASIS OF PRESENTATION

The Company was incorporated under the laws of the state of Nevada on June 17, 2004 with authorized common stock of 50,000,000 shares with a par value of $.001 and 10,000,000 preferred shares with a par value of $.001. None of the preferred shares have been issued and the terms have not been established.

The Company is in the business of offering integrated multi-media promotional services to small network marketing organizations and other small businesses to promote sales of their products or services. The Company assists them in using marketing tools such as public relations as well as developing and utilizing such services as advertising, direct mail, electronic communication, and promotions to increase product and service awareness.  The Company offers quality marketing strategies and services for their business along with marketing support services, such as ad design, ad placement strategies, advertising sales, website development, marketing plans, focus groups, and media buying

The Company has not reached full operations and is in the development stage.

The results of operations for the interim periods are not necessarily indicative of the results for the full year. In management’s opinion all adjustments necessary for a fair presentation of the Company’s financial statements are reflected in the interim periods included, and are of a normal recurring nature.

2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Accounting Methods

The Company recognizes income and expenses based on the accrual method of accounting.

Dividend Policy

The Company has not yet adopted a policy regarding payment of dividends.

Income Taxes

The Company utilizes the liability method of accounting for income taxes.  Under the liability method deferred tax assets and liabilities are determined based on the differences between financial reporting and the tax bases of the assets and liabilities and are measured using the enacted tax rates and laws that will be in effect, when the differences are expected to reverse.  An allowance against deferred tax assets is recorded, when it is more likely than not, that such tax benefits will not be realized.

On March 31, 2011 the Company had a net operating loss available for carry forward of $113,583. The income tax benefit of approximately $39,000 from the carry forward has been fully offset by a valuation reserve because the use of the future tax benefit is doubtful since the Company has been unable to project a reliable estimated net income for the future.  The net operating loss will expire starting in 2024 through 2031.

Financial and Concentrations Risk

The Company does not have any concentration or related financial credit risk.

Basic and Diluted Net Income (Loss) Per Share

Basic net income (loss) per share amounts are computed based on the weighted average number of shares actually outstanding. Diluted net income (loss) per share amounts are computed using the weighted average number of common shares and common equivalent shares outstanding as if shares had been issued on the exercise of any common share rights unless the exercise becomes antidilutive and then the basic and diluted per share amounts are the same.

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Statement of Cash Flows

For the purposes of the statement of cash flows, the Company considers all highly liquid investments with a maturity of three months or less to be cash equivalents.

Revenue Recognition

Revenue is recognized on the sale and delivery of a product or the completion of a service provided

Advertising and Market Development

The Company expenses advertising and market development costs as incurred.

Estimates and Assumptions

Management uses estimates and assumptions in preparing financial statements in accordance with accounting principles generally accepted in the United States of America.  Those estimates and assumptions affect the reported amounts of the assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses.  Actual results could vary from the estimates that were assumed in preparing these financial statements.

Financial Instruments

The carrying amounts of financial instruments are considered by management to be their estimated fair values due to their short-term maturities.

Recent Accounting Pronouncements

The Company does not expect that the adoption of other recent accounting pronouncements will have a material impact on its financial statements.

3.  CAPITAL STOCK

From its inception the Company has issued 6,010,000 private placement common shares for services valued at $2,000 and 136,600 private placement common shares for cash of $99,600.

4. SIGNIFICANT TRANSACTIONS WITH RELATED PARTIES

Until March 24, 2011, the Company’s then sole officer and director owned 81% of the outstanding common capital stock, having made contributions to capital of $12,657.

A portion of the Company’s revenues have been derived from a related party, KAATN of Wyoming, a company controlled by Burke Green, a director and former sole officer of the Company. The Company is paid for each service it provides to KAATN at a rate that is usual in the industry and the same as what the Company charges its other clients

On March 24, 2011, the Company and Burke Green, the Company’s then principal stockholder and sole officer and director, entered into and closed a Securities Purchase Agreement (the “Green Purchase Agreement”) with Foster Jennings, Inc., a Delaware corporation (“FJ”) whereby Burke sold 4,962,500 shares (the “Green Shares”) of Company common stock to FJ for cash consideration of $397,500 (the “Green Cash Consideration”).

5.  GOING CONCERN

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company does not have sufficient working capital for its planned activity and to service its debt, which raises substantial doubt about its ability to continue as a going concern.

In the absence of Company increasing existing revenues in a significant manner, continuation of the Company as a going concern is dependent upon obtaining additional working capital. A business combination with the entity that

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financial services, commercial finance, domestic insurance, retail insurance and capital markets –Andrew and Scott to review and revise.  

Critical Accounting Estimates

The preparation of financial statements in conformity with accounting principals generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, we evaluate our estimates, based on historical experience, and various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.  Actual results could differ from those estimates.

Results of Operations

The following discussions are based on the unaudited financial statements for the three and nine months ended March 31, 2011 (“MAR2011”) and March 31, 2010 (“MAR2010”). The discussions are summary and should be read in conjunction with the financial statements and notes included in this report.

Comparison of March 31, 2011 and 2010 Operations

Revenues

Revenues are generated by marketing services provided to our clients and are recognized as earned at the time the services are provided.   Services are provided, and fees negotiated on an individualized per job basis usually at prices normal and usual in the industry. We do not have service contracts with clients but perform services in accordance with the clients’ needs and budget. We achieve revenues from both network marketers and other small businesses.

Revenues three-months ended MAR2011 and MAR2010: We had revenues of $61,200 during our third quarter of our current fiscal year, an increase over the $48,000 in revenues we generated in our third quarter last year. This year our revenues were derived from 3 non-related party clients. During our third fiscal quarter of MAR2010 our revenues were derived from 5 clients: 4 non-related clients and 1 related party client. The related party client, KAATN of Wyoming, provided approximately 6% of the revenue stream during the period.

Revenues nine-months ended MAR2011 and MAR2010: Revenues in our nine months ended MAR2011 were $81,050, a decrease over the revenues received during our nine months ended MAR2010 which were $125,317. The largest portion of the nine month ended MAR2011 revenues were achieved during the third quarter. During the nine period ended MAR2011 all revenues were derived from 4 non-related party clients. Revenues during our nine months ended MAR2010 were derived from 11 clients, one of which was a related party. The related party client, KAATN of Wyoming, is a network marketing company controlled by a director of Andina, Burke Green. KAATN markets a health juice product called MonaVie. Our revenue stream from KAATN, however, is not tied to the MonaVie compensation structure which is based on multi-level product sales. Our revenues from KAATN, which accounted for approximately 7% of our revenues during the nine month period ended MAR2010, and our other clients, are based on individual services performed.

Expenses/Loss from Operations

Three months ended MAR2011and MAR2010: Spending during our third quarter of this fiscal year reflects Management’s efforts to increase revenues with a specific concentration on network marketers expanding into international markets, especially Korea, Taiwan, Malaysia and Thailand. Our sales, general and administrative

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expenses were $51,576 during the three months ended MAR2011, up nearly $20,000 from the $32,172 we spent during our third fiscal quarter ended MAR2010. This resulted in income from operations of $9,624 this year compared to $15,828 in income from operations during that same three-month period last year.  Expenses during our third quarter include marketing costs of $10,000 compared to $14,430 last year during that same period. Marketing expenses consist of all marketing related expenditures except direct costs paid out for signs, print or radio advertising, brochures and material distributed to the public which are categorized as advertising. Legal, accounting, consulting and professional fees cost us approximately $14,866 this year during the third quarter more than twice as much as the $6,505 we spent during the three months ended MAR2010; the increase this year is a result of increased consulting expenses of $13,330 during our third fiscal quarter compared to $5,000 during our third fiscal quarter last year. We incurred no travel expenses in our third quarter ended MAR2011 compared to travel expenses of $2,109 during the third quarter ended MAR2010. The most significant spending difference in our third quarter ended MAR2011 is $26,270 in research and development costs with $8,500 in that category in the prior year’s third quarter. Overall we spent significantly more during the third quarter this year on consulting, research and development with management taking advantage of increased revenues to make a more concerted effort to expand into the Asian market.

Nine months ended MAR2011and MAR2010: During our nine-months ended MAR2011 our sales, general and administrative expenses were approximately $73,000, significantly less than the $116,385 we spent in the comparable nine-month period of last year.  Despite decreased spending, revenues this year were also less and resulted in net income of $7,686 in the current nine month period compared to $8,932 in the nine-month period ended MAR2010. We had no advertising expenses this year and only $75 in travel expenses; during the nine months ended MAR2010 we spent $4,800 and $7,700 in those categories, respectively. Advertising costs consist mainly of direct costs paid out for signs, print or radio advertising, brochures and material distributed to the public. Marketing costs also decreased significantly to $10,500 during the nine-month period ended MAR2011 compared to the $47,014 spent in the nine months ended MAR2010. Marketing expenses consist of all marketing related expenditures except direct costs paid out for signs, print or radio advertising, brochures and material distributed to the public. Last year we focused more on marketing in general than we did this year when our main concern was expanding and developing our Asian markets.  Professional fees are a large component of our operating expenses and include legal, accounting, consulting, administration fees and telemarketing.  During our nine-months ended MAR2011 we spent $35,235 in this category whereas during the nine months ended MAR2010 we spent $44,131. A significant difference between the two nine month periods is research and development costs for the current nine months ended were $26,670, and occurred during the third fiscal period, compared to $8,500 during the nine-months ended MAR2010 Nearly all of the increases in spending occurred in the second and third quarters when increased revenues allowed management to focus on our developing Asian markets.

Balance Sheet Information

The chart below presents a summary of our balance sheet at March 31 2011 and June 30, 2010:

We had only $19 cash as of our fiscal year ended June 30, 2010. Our cash increased to $4,096 at March 31, 2011.  Liabilities of $9,031 at our June 30, 2010 fiscal year end decreased to $5,422 during our third fiscal quarter and consist of accounts payable due to professional services for legal and accounting.  

Commitment and Contingencies

We have no leases in place.

Off-Balance Sheet Arrangements

None.

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Liquidity and Capital Resources/ Plan of Operation for the Next Twelve Months

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SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

THE ANDINA GROUP, INC.

(registrant)

By: /s/ Scott W. Hartman

      Scott W. Hartman

      Chief Executive Officer

Dated:  May 13, 2011

By:/s/ Andrew B. Scherr

     Andrew B. Scherr

     Chief Financial Officer

Dated:  May 13, 2011

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