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TMCNet:  CYTTA CORP. - 10-K - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

[January 17, 2014]

CYTTA CORP. - 10-K - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(Edgar Glimpses Via Acquire Media NewsEdge) The following discussion highlights the principal factors that have affected our financial condition and results of operations as well as our liquidity and capital resources for the periods described. This discussion contains forward-looking statements. Please see "Forward-Looking Statements" for a discussion of the uncertainties, risks and assumptions associated with these forward-looking statements.


The following discussion and analysis of the Company's financial condition and results of operations are based on the preparation of our financial statements in accordance with U.S. generally accepted accounting principles. You should read the discussion and analysis together with such financial statements and the related notes thereto.

13 Results of Operations We have generated $2,800 in revenues from our business operations for the year ended September 30, 2013 and have incurred $ 2,267,653 in operating expenses through the year then ended.

The following table provides selected financial data about our company for the fiscal year ended September 30, 2013 and 2012, respectively.

Balance Sheet Data September 30, 2013 September 30, 2012 Cash and cash equivalents $ 188,068 $ 36,080 Total assets $ 245,704 $ 96,295 Total liabilities $ 476,837 $ 684,031 Shareholders' equity (deficit) $ (23,133) $ (587,736) Our cash in the bank at September 30, 2013 was $188,068. Net cash provided by financing activities during the year through September 30, 2013 was $468,300.

Plan of Operation Cytta has for several years been designing and building an ecosystem that would allow any Bluetooth device to automatically send its data to our specially provisioned Android SmartPhone and then instantly pass that data unto a cloud based Electronic Medical Record, which is automatically populated with the client's readings and information. The goal of the Cytta Connect system was to allow patients, their caregiver or medical providers to review and monitor their progress remotely on an ongoing basis.

On June 18th, 2009, the Company entered into a Licensing Agreement with Lifespan, Inc. Through a series of transactions and business developments commencing in 2002, Lifespan had acquired the expertise and licenses to manufacture, distribute and market various technology-based internet access and computing products and services, consisting of internet access devices, related software and hardware and a series of medical peripherals designed and adapted to provide remote non-diagnostic monitoring of home based and remote patients.

Under the terms of the Agreement with Cytta, Lifespan granted the Company the exclusive license to manufacture, sell, distribute, operate, sub-license and market these internet access devices, products and services in the United States. The Company plans to utilize the License to develop a model for the internet access devices which can incorporate the numerous technology advances which are currently available and is currently pursuing this avenue On November 10th, 2010, the Company entered into an MVNO Mobile Virtual Network Operator Agreement (herein "MVNO Agreement") with Vonify Inc. of Toronto, Canada and Georgetown, Grand Cayman Island, BWI (herein "Vonify") and MVNO Mobile Virtual Network Operator Corp (herein "MVNO") of New Westminster, Canada for a license to provide all the "Services" of the Vonify Network to third parties, in the medical marketplace in the USA. The Vonify Network includes those integrated mobile switching facilities, servers, cell sites, telecom and internet connections, billing systems, validation systems, gateways, landline switches and other related facilities used to provide the Services. The Services to be marketed by Cytta are defined as wireless telecommunications services for the Global System for Mobile (GSM) communications.

Since the acquisition of the Lifespan Technology, and the MVNO Agreement, the Company has a remote medical monitoring model designed to deliver seamless, near real-time, medical data transmission, through Bluetooth connectivity, utilizing the Company's wireless telecommunication services, to major medical payor/providers back end electronic medical monitoring systems (EMR's) with a pricing structure sufficient to generate a positive return on investment (ROI) for the clients.

14 The Company and its licensing partner have now completed the development of the proprietary Firmware Client and have installed the technology on several Nexus One, HTC My Touch, HTC Wildfire, HTC Sense, Sony Xperia android smartphones.as well as with the Samsung and HTC tablets. The testing and integration of the combination Smartphone/tablets and Firmware Client, which has collectively been described as the Cytta Medical Smartphone or the Cytta Medical Tablet, with the blood pressure, weight scale, pulse/oximetry and blood glucose devices has been completed and are all functioning seamlessly. The Company has completed the development of the 'Online Data Presentation Screens" Dashboard or 'Instant EMRTM' to represent the data captured by the system for its clients.

The Company began its first installations of the complete Cytta Ecosystems in September 2011 in the US, with two Medical Group clients wishing to utilize and or participate in the Company's "medical monitoring ecosystem'. In March 2012 the Company commenced its first major installation and product evaluation with a major medical Insurance Co/Payor. The Company also delivered its second round of orders to its first two medical group clients and has received notice of upcoming further installations.

Upon conclusion of the Insurance co/Payor Pilot Program evaluation, the Company will begin full deployment of its systems and commence operations as a Medical Health Service Provider (MHSP). In November 2012 the Company received the 6 Month Pilot Program Whitepaper dated September 30, 2012 independently prepared by the major medical Insurance Co/Payor with whom the Pilot program was conducted. To this end the Company is currently in discussions with potential partners and/or clients wishing to utilize and or participate in the model or the 'Company's 'medical monitoring ecosystem'. The Company continues to advance the technology and its capabilities while discussing implementations in accordance with the Affordable Care Act.

Cytta currently has minimal operating costs and expenses at the present time due to our relatively new business activities. However we anticipate significantly increasing our activities as a result of the first sales of our systems and the installation thereof. We have entered into certain management and consulting contracts with our senior Officers and non-affiliated consultants who will be providing business services to the Company in the health care arena.

Additionally, we will be required to raise significant capital over the next twelve months, in connection with our operations resulting from our marketing Agreements.

We have engaged in significant product research and development over the past years while the technology and system was being developed. The Company's business may cause us to engage in further research and development in the foreseeable future. We have no present plans to purchase or sell any plant or significant equipment although we will have to acquire some equipment related to the marketing Agreements. We also have immediate plans to add employees and we will continue to do so in the future as a result of the operations related to the marketing of our systems.

Liquidity and Capital Resources Our cash and cash equivalents balance as of September 30, 2013 was $188,068.

We currently have three clients utilizing our systems and are fully operational.

We currently have many potential clients evaluating our technology and systems.

We do not have sufficient funds on hand to pursue our business objectives for the near future or to commence operations without seeking additional funding. We currently do not have a specific plan of how we will obtain such funding.

Loans to the Company We have been receiving loans from related parties of the Company to pay general operating costs in the form of convertible demand notes payable. The convertible demand promissory notes do not bear interest. As of September 30, 2013, $476,837 in notes was outstanding.

15 We have minimal operating costs and expenses at the present time due to our limited business activities. We will, however, be required to raise additional capital over the next twelve months to meet our current administrative expenses and to develop our operations. This financing may take the form of additional sales of our equity or debt securities to, or loans from, stockholders, or from our officers and directors. There is no assurance that additional financing will be available from these or other sources, or, if available, that it will be on terms favorable to us.

Going Concern Our auditors have included an explanatory paragraph in their report on our financial statements relating to the uncertainty of our business as a going concern, due to our limited operating history, our lack of historical profitability, and our limited funds. We believe that we will be able to raise the required funds for operations and to achieve our business plan.

Off-Balance Sheet Arrangements We have no off-balance sheet arrangements.

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