UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_____________________

FORM 10-Q

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

SECURITIES EXCHANGE ACT OF1934

For the quarterly period ended March 31, 2009

/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number 000-28052

____________________

EN POINTE TECHNOLOGIES, INC.

(Exact name of registrant as specified in its charter)

Delaware	75-2467002
(State or other jurisdiction of	(I.R.S. Employer Identification No.)
incorporation or organization)

18701 S. Figueroa Street
Gardena, California	90248
(Address of principal executive offices)	(Zip Code)

(310) 337-5200

(Registrant's telephone number, including area code)

Indicate by check mark 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 [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 (§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 definitions of “accelerated filer", "large accelerated filer” and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer _____ Accelerated filer _______ Non-accelerated filer 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 ]

As of May 14, 2009, 7,181,941 shares of common stock of the Registrant were issued and outstanding.

INDEX

En Pointe Technologies, Inc.

PART I

Item 1.

Item 2.

Item 4T.

PART II

Item 1.

Item 6.

FINANCIAL INFORMATION

Financial Statements

Condensed Consolidated Balance Sheets – March 31, 2009 and September 30, 2008

Condensed Consolidated Statements of Operations and Comprehensive Income - Three months and six months ended March 31, 2009 and 2008

Condensed Consolidated Statements of Cash Flows - Six months ended March 31, 2009 and 2008

Notes to Condensed Consolidated Financial Statements - March 31, 2009

Management's Discussion and Analysis of Financial Condition and Results of Operations

Controls and Procedures

OTHER INFORMATION

Legal Proceedings

Exhibits

Signatures

Item 3 of Part I and Item 1A of Part II have been omitted based on the Company’s status as a “smaller reporting company.” Items 2, 3, 4 and 5 of Part II have been omitted because they are not applicable with respect to the current reporting period.

En Pointe Technologies, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(In Thousands Except Share and Per Share Amounts)

	March 31,			September 30,
	2009			2008
ASSETS:
Current assets:
Cash	$	8,163		$	3,691
Restricted cash		10			10
Accounts receivable, net		34,115			35,448
Due from affiliate		--			3,586
Inventories, net		7,462			5,858
Prepaid expenses and other current assets		1,214			1,294
Total current assets		50,964			49,887

Property and equipment, net of accumulated
depreciation and amortization		4,113			4,202

Other assets
Due from affiliate		4,290			--
Equitable securities held in escrow		2,584			7,955
Other		5,766			5,754
Total other assets		12,640			13,709
Total assets	$	67,717		$	67,798


LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
Accounts payable, trade	$	19,295		$	15,817
Borrowings under line of credit		8,653			7,840
Current maturities of long-term debt		216			375
Accrued liabilities		10,854			11,153
Accrued taxes and other liabilities		6,335			4,522
Total current liabilities		45,353			39,707
Long term liabilities		377			475
Total liabilities		45,730			40,182

Noncontrolling interest		1,934			1,962

Stockholders' equity:
Preferred stock, $.001 par value:
Shares authorized--5,000,000
No shares issued or outstanding		--			--
Common stock, $.001 par value:
Shares authorized--15,000,000; with 7,182,643 and 7,162,643 shares issued		7			7
Additional paid-in capital		43,647			43,616
Treasury stock, 702 shares		(1	)		(1	)
Accumulated other comprehensive loss		(6,315	)		(659	)
Accumulated deficit		(17,285	)		(17,309	)
Total stockholders' equity		20,053			25,654
Total liabilities and stockholders' equity	$	67,717		$	67,798

See Notes to Condensed Consolidated Financial Statements.

En Pointe Technologies, Inc.
Condensed Consolidated Statements of Operations
and Comprehensive Income
(Unaudited)
(In Thousands, Except Per Share Amounts)

	Three months ended							Six months ended
	March 31,							March 31,
		2009			2008			2009			2008
Net sales:
Product		$	43,093		$	58,480		$	95,486		$	132,628
Service			2,845			12,087			5,339			24,821
Total net sales			45,938			70,567			100,825			157,449
Cost of sales:
Product			37,834			52,446			84,187			120,368
Service			1,954			7,136			3,661			14,202
Total cost of sales			39,788			59,582			87,848			134,570
Gross profit:
Product			5,259			6,034			11,299			12,260
Service			891			4,951			1,678			10,619
Total gross profit			6,150			10,985			12,977			22,879

Selling and marketing expenses			4,638			9,539			9,568			18,367
General and administrative expenses			3,151			3,891			5,519			6,967
Operating (loss) income			(1,639	)		(2,445	)		(2,110	)		(2,455	)

Interest (expense) income, net			(5	)		(25	)		15			41
Other income (expense), net			1,975			(567	)		1,946			(506	)
Income (loss) before income taxes and minority interest			331			(3,037	)		(149	)		(2,920	)
(Benefit) provision for income taxes			(18	)		(6	)		(44	)		25
Income (loss) before other items			349			(3,031	)		(105	)		(2,945	)
Allocated income from equity investment			58			--			101			--
Allocated loss (income) to non-controlling interest			9			10			28			(33	)
Net income (loss)			416			(3,021	)		24			(2,978	)
Other comprehensive (loss) income, net of tax
Foreign currency translation adjustment			(50	)		(51	)		(40	)		(76	)
Valuation adjustment for equity positions			(1,877	)		--			(5,616	)		--
Comprehensive loss		$	(1,511	)	$	(3,072	)	$	(5,632	)	$	(3,054	)

Net income (loss) per share:
Basic		$	0.06		$	(0.42	)	$	0.00		$	(0.42	)
Diluted		$	0.06		$	(0.42	)	$	0.00		$	(0.42	)

Weighted average shares outstanding:
Basic			7,182			7,158			7,182			7,158
Diluted			7,182			7,158			7,182			7,158


See Notes to Condensed Consolidated Financial Statements.


En Pointe Technologies, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(In Thousands)

	Six months ended
	March 31,
	2009			2008
Cash flows from operating activities:
Net income (loss)	$	24		$	(2,978	)
Adjustments to reconcile net (loss) income
to net cash provided by operations:
Depreciation and amortization		993			1,436
Gain on sale of services business		(2,000	)		--
Impairment of investment					500
Allowances (recovery) for doubtful accounts, returns, and inventory		(681	)		421
(Gain) loss on disposal of assets		(42	)		110
Allocated income from equity investment		(100	)		--
Allocation of loss (income) to noncontrolling interest		(28	)		33
Net change in operating assets and liabilities		4,816			17,398
Net cash provided by operating activities		2,982			16,920

Cash flows from investing activities:
Short-term cash investment		--			954
Purchase of property and equipment		(828	)		(1,743	)
Investment in securities					(500	)
Proceeds from sale of equipment		193			28
Net cash used by investing activities		(635	)		(1,261	)

Cash flows from financing activities:
Net borrowings (repayments) under line of credit		813			(17,503	)
Net borrowings (repayments) under short-term financing		1,649			(922	)
Proceeds from exercise of employee stock options		31			--
Payment on long term liabilities		(368	)		(331	)
Net cash provided (used) by financing activities		2,125			(18,756	)
Increase in cash		4,472			(3,097	)
Cash at beginning of period		3,691			6,000
Cash at end of period	$	8,163		$	2,903


Supplemental disclosures of cash flow information:
Interest paid	$	85		$	147
Income taxes paid	$	384		$	44
Capitalized leases	$	110		$	222

See Notes to Condensed Consolidated Financial Statements.

En Pointe Technologies, Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note 1 - Basis of Presentation and General Information

In the opinion of management, the unaudited condensed consolidated balance sheets of En Pointe Technologies, Inc., including (i) its wholly-owned subsidiaries En Pointe Technologies Sales, Inc., En Pointe Gov, Inc., En Pointe Technologies Canada, Inc., The Xyphen Corporation, and En Pointe Europe, Inc. Limited, (ii) its majority-owned subsidiary Ovex Technologies (Private) Limited, and (iii) its minority-owned affiliate Premier BPO, Inc. (a "Variable Interest Entity") and its wholly-owned Chinese subsidiary, Premier BPO Tianjin Co., Ltd. (collectively, referred to as "we," “us” “our” or similar terms), at March 31, 2009, and the unaudited condensed consolidated statements of operations and unaudited condensed consolidated statements of cash flows for the three months and six months ended March 31, 2009 and 2008, respectively, include all adjustments (consisting only of normal recurring adjustments) necessary to fairly state these financial statements in accordance with the rules and regulations of the United States Securities and Exchange Commission (“SEC”) for interim financial reporting.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to the rules and regulations of the SEC. The year-end balance sheet data were derived from audited financial statements, but do not include disclosures required by generally accepted accounting principles. Operating results for the three months and six months ended March 31, 2009 are not necessarily indicative of the results that may be expected for the year ending September 30, 2009. It is suggested that these condensed financial statements be read in conjunction with our most recent Form 10-K, as amended, for the fiscal year ended September 30, 2008.

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make certain estimates and assumptions that affect the reported amount 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 reported period. On an on-going basis, management evaluates its estimates and judgments, including those related to customer bad debts, product returns, vendor returns, rebate reserves, inventories, other contingencies and litigation. Management bases its estimates and judgments on historical experience and on various other factors 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 may differ from these estimates under different assumptions or conditions.

On March 11, 2009, we entered into an Agreement and Plan of Merger (the “Agreement”) with Din Global Corp., a Delaware corporation (“Holding Co.”), and ENP Acquisition, Inc., a Delaware corporation and wholly-owned subsidiary of Din Global Corp. (“Acquisition Co.”). Under the terms of the Merger Agreement, Acquisition Co. will be merged with and into En Pointe Technologies, Inc., and we will continue as the surviving corporation and a wholly-owned subsidiary of Holding Co. (the “Merger”). As of March 11, 2009, Holding Co. was owned by our Chief Executive Officer, Attiazaz “Bob” Din, and, prior to the Merger, is anticipated to be owned by Mr. Din, Naureen Din (Mr. Din’s wife and also a member of our Board of Directors), and members of Mr. and Mrs. Din’s family.

At the effective time of the Merger, each of our issued and outstanding shares of common stock (the “Common Stock”), other than shares of Common Stock owned by us, Acquisition Co., Holding Co., Mr. Din, Mrs. Din and members of Mr. and Mrs. Din's family and any stockholders who are entitled to and who properly exercise appraisal rights under Delaware law, will be converted into the right to receive $2.50 in cash, without interest. Additionally, each outstanding option to purchase Common Stock will be canceled immediately prior to the effective time of the Merger in exchange for the right to receive a cash payment equal to the difference between $2.50 and the per share exercise price of such option, multiplied by the number of shares of Common Stock subject to such option. Mr. and Mrs. Din will not receive any payment for the cancellation of their respective options.

Our Board of Directors (without the participation of Mr. and Mrs. Din in deliberations or voting) approved the Agreement on the unanimous recommendation of a Special Committee composed solely of independent directors (the “Special Committee”).

We have made customary representations, warranties and covenants in the Agreement, including covenants that we will run our business in the ordinary course of business consistent with past practice and will refrain from taking certain actions between the date of the Agreement and the date of closing of the Merger. Our representations and warranties each expire at the effective time of the Merger. The Agreement permitted us to solicit alternative acquisition proposals from third parties until April 10, 2009. However, no potential transaction partners expressed an interest during that period in pursuing a transaction likely to lead to a takeover proposal as an alternative to the merger. In addition, we may, at any time, subject to the terms of the Agreement, respond to unsolicited proposals. There can be no assurance that this process will result in an alternative transaction. We do not intend to disclose developments with respect to the solicitation process unless and until our Board of Directors has made a decision with respect to the alternative acquisition proposals, if any, it receives.

Consummation of the Merger is subject to obtaining regulatory approvals and other customary closing conditions, including among others, no material change in our representations and warranties prior to the closing of the Merger, Acquisition Co.’s ability to obtain sufficient financing, holders of not more than ten percent of our outstanding Common Stock seeking appraisal rights of their shares, we shall have obtained any necessary third party consents, approval of the Merger by our stockholders, including a separate approval of stockholders other than Holding Co., Acquisition Co., Mr. Din, Mrs. Din, their children and any of their respective affiliates. The parties to the Agreement expect to close the transaction in the second quarter of 2009. We, however, can provide no assurance that the Merger will be completed.

The Agreement may be terminated under certain circumstances, including if our Board of Directors (or the Special Committee) has determined in good faith that it has received a superior proposal and otherwise complies with certain terms of the Agreement or if the Merger shall not have been consummated by July 31, 2009. Upon the termination of the Agreement, under specified circumstances, we will be required to pay Holding Co. a termination fee of up to $350,000. Additionally, under specified circumstances, Holding Co. will be required to pay us a termination fee of $350,000. Mr. Din has agreed to guarantee of any such amounts payable by Holding Co. to us.

Note 2 – Computation of Earnings Per Share

The following table sets forth the computation of basic and diluted net income per share (in thousands, except for per share amounts):


	Three Months Ended					Six Months Ended
	March 31,					March 31,
	2009		2008			2009		2008
Net income (loss)	$	416	$	(3,021	)	$	24	$	(2,978	)

Weighted average shares outstanding		7,182		7,158			7,182		7,158
Effect of dilutive securities:
Dilutive potential of options		--		--			--		--
Weighted average shares and share equivalents
outstanding		7,182		7,158			7,182		7,158

Basic income (loss) per share	$	0.06	$	(0.42	)	$	0.00	$	(0.42	)
Diluted income (loss) per share	$	0.06	$	(0.42	)	$	0.00	$	(0.42	)

Note 3 – Recent Accounting Pronouncements

Accounting pronouncements adopted:

In February 2007, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards ("SFAS") No. 159, The Fair Value Option for Financial Assets and Financial Liabilities-Including an Amendment of FASB Statement No. 115, which is effective for us in fiscal years beginning after July 1, 2008. This statement permits an entity to choose to measure many financial instruments and certain other items at fair value at specified election dates. Subsequent unrealized gains and losses on items for which the fair value option has been elected will be reported in earnings. We adopted this accounting pronouncement effective October 1, 2008 and the adoption has not had a material effect on our consolidated financial statements.

In July 2006, the FASB issued Interpretation No. 48, Accounting for Uncertainty in Income Taxes ("FIN No. 48"). This interpretation requires recognition and measurement of uncertain income tax positions using a "more-likely-than-not" approach. The provisions of FIN No. 48 are effective for fiscal years beginning after December 15, 2006. We adopted this accounting pronouncement effective October 1, 2007and the adoption has not had a material effect on our consolidated financial statements.

In September 2006, the FASB issued FAS 157, Fair Value Measurements. This standard defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. This statement is effective for financial statements issued for fiscal years beginning after November 15, 2007. We adopted this accounting pronouncement effective October 1, 2008 and the adoption has not had a material effect on our consolidated financial statements.

Accounting pronouncements pending adoption:

In March 2008, the FASB issued SFAS No. 161, Disclosures about Derivative Instruments and Hedging Activities, an amendment of FASB Statement No. 133. SFAS No. 161 requires enhanced disclosures about a company's derivative and hedging activities. These enhanced disclosures will discuss (a) how and why a company uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for under FASB Statement No. 133 and its related interpretations and (c) how derivative instruments and related hedged items affect a company's financial position, results of operations and cash flows. SFAS No. 161 is effective for fiscal years beginning on or after November 15, 2008, with earlier adoption allowed. We do not anticipate that the adoption of this accounting pronouncement will have a material effect on our consolidated financial statements.

In February 2008, the FASB issued FASB Staff Position No. 157-2, Effective Date of FASB Statement No. 157, which delays the effective date of SFAS 157 for nonfinancial assets and nonfinancial liabilities to fiscal years beginning after November 15, 2008. Therefore, we will delay application of SFAS 157 to our nonfinancial assets and nonfinancial liabilities. We do not anticipate that the delayed adoption of this accounting pronouncement will have a material effect on our consolidated financial statements.

In December 2007, the FASB issued SFAS No. 141(R), Business Combinations, and SFAS No. 160, Accounting and Reporting of Noncontrolling Interests in Consolidated Financial Statements, an amendment of ARB No. 51. These new standards will significantly change the financial accounting and reporting of business combination transactions and noncontrolling (or minority) interests in consolidated financial statements. SFAS 141(R) is required to be adopted concurrently with SFAS 160 and is effective for business combination transactions for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008. Early adoption is prohibited. We do not anticipate that the adoption of this accounting pronouncement will have a material effect on our consolidated financial statements.

Note 4 – Segment Reporting

The provisions of SFAS No. 131, “Disclosures about Segments of an Enterprise and Related Information”, require public companies to report financial and descriptive information about their reportable operating segments. We identify reportable segments based on how management internally evaluates separate financial information, business activities and management responsibility. In fiscal year 2007, we began operating initially in two segments until the fourth quarter of fiscal year 2007 when the China business process services was added. The following table provides information as to how the segments contributed to our operations and assets (in thousands):

	As of and for the Quarter Ended March 31, 2009
	US		Pakistan			China
	Sales of Product		Business Process			Business Process					Intersegment			Consolidated
	and Services		Services			Services		En Pointe Europe			Eliminations			Total
Sales from non affiliated customers	$	45,356	$	582		$	--	$	--		$	--		$	45,938
Intersegment sales	$	0	$	1,895		$	150	$	--		$	(2,045	)	$	0
Depreciation and amortization	$	327	$	91		$	10	$	1		$	--		$	429
Segment (loss) profit	$	763	$	(353	)	$	7	$	(1	)	$	--		$	416
Segment assets	$	64,260	$	3,937		$	206	$	17		$	(703	)	$	67,717

	As of and for the Six Months Ended March 31, 2009
	US		Pakistan			China
	Sales of Product		Business Process			Business Process						Intersegment			Consolidated
	and Services		Services			Services			En Pointe Europe			Eliminations			Total
Sales from non affiliated customers	$	99,911	$	914		$	--		$	--		$	--		$	100,825
Intersegment sales	$	--	$	3,707		$	282		$	--		$	(3,989	)	$	0
Depreciation and amortization	$	711	$	262		$	20		$	--		$	--		$	993
Segment (loss) profit	$	756	$	(729	)	$	(2	)	$	(1	)	$	--		$	24
Segment assets	$	64,260	$	3,937		$	206		$	17		$	(703	)	$	67,717

Note 5 – Litigation

In January 2009, in order to avoid the cost of ongoing litigation, we reached a settlement agreement with Church Gardens, LLC (“Church”) relating to an action that was brought against us in July 2006 in San Bernardino County Superior Court, Case No. RCV096518. The complaint centered on certain furniture, fixtures, equipment and leasehold improvements that were sold to, and leased back to us , by Church’s predecessor in 1999 when we still occupied its former leased configuration facility in Ontario, California. Church alleged, among other things, that a portion of the leased-back property was sold, destroyed, altered, or removed from the premises, and demanded both an inspection and an accounting of the property remaining and for the court to provide damages to the extent that we may have breached our contract. Under terms of the settlement agreement, Church released to us certain furniture and equipment being warehoused by them and we paid Church $450,000. The full amount of the settlement payment was recognized in the September 2008 quarterly financial statements. The settlement was a business decision and in entering into the settlement, we made no admission of liability.

On October 21, 2008, Pacific Blue Micro filed its Complaints against one of our employees who was a former Pacific Blue Micro employee and against us as defendants therein.us in Case Number 30-2008-00113542 in the Superior Court of Orange County, California. We and our employee have cross-complained against Pacific Blue Micro. We vigorously dispute any liability to Pacific Blue Micro.

On October 23, 2008, two former employees served Cross-Complaints against us in Case Number BC-397341 in the Superior Court of Los Angeles County, California. We had sued our former employees and they cross-complained against us. We vigorously dispute liability to them.

On January 20, 2009, Softchoice Corporation filed its second amended Complaint in Case Number CL07-5777 in the Circuit Court for the City of Norfolk, Virginia against one of our employees who was a former Softchoice Corporation employee and against us and our subsidiary, En Pointe Technologies Sales, Inc., as defendants therein. We vigorously dispute liability.

There are various other claims and litigation proceedings in which we are involved in the ordinary course of business. We provide for costs related to contingencies when a loss is probable and the amount is reasonably determinable. While the outcome of the foregoing and other claims and proceedings cannot be predicted with certainty, after consulting with legal counsel, management does not believe that it is reasonably possible that any ongoing or pending litigation will result in an unfavorable outcome or have a material adverse affect on our business, financial position and results of operations or cash flows.

Note 6 - Fair Value Measurements

Effective October 1, 2008, we adopted Statement of Financial Accounting Standard No. 157, Fair Value Measurements (“FAS 157”). This standard establishes a framework for measuring fair value and requires enhanced disclosures about fair value measurements. FAS 157 clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. SFAS 157 also requires disclosure about how fair value is determined for assets and liabilities and establishes a hierarchy for which these assets and liabilities must be grouped, based on significant levels of inputs as follows:

Level 1	quoted prices in active markets for identical assets or liabilities;
Level 2	quoted prices in active markets for similar assets and liabilities and inputs that are observable for the asset or liability; or
Level 3	unobservable inputs, such as discounted cash flow models or valuations.

The following is a listing of our assets and liabilities required to be measured at fair value on a recurring basis as of March 31, 2009 (in thousands):

		Level 1				Level 2				Level 3				Total
Marketable equities		$	3,214			$	--			$	--			$	3,214

Note 7 - Equity Investment

For the three months and six months ended March 31, 2009, the financial results of En Pointe Global Services LLC ("EP Global"), in which we have a 19.5% equity interest was as follows:

	(In Thousands)
	Quarter Ended			Six Months Ended
	March 31, 2009			March 31, 2009
Statement of Operations
Net service revenues	$	10,469		$	20,677
Cost of revenues		6,027			12,008
Total gross profit		4,442			8,669
Selling, marketing and administration		4,145			8,154
Net income allocatable to partners	$	297		$	515
En Pointe percentage ownership		19.5	%		19.5
Allocated to En Pointe	$	58		$	100

Balance Sheet					March 31, 2009
Cash				$	59
Accounts receivable, net					6,957
Other current assets					736
Total current assets					7,752
Property and equipment, net					1,242
Total Assets				$	8,994

Accounts payable				$	294
Accrued liabilities and deferred revenue					1,769
Due En Pointe					4,219
Total current liabilities					6,282
Member equity					2,712
Total Liabilities and Member Equity				$	8,994

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

En Pointe Technologies, Inc., including its wholly-owned subsidiaries En Pointe Technologies Sales, Inc., En Pointe Gov, Inc., En Pointe Technologies Canada, Inc., The Xyphen Corporation, and En Pointe Europe, Inc. Limited, its majority-owned subsidiary Ovex Technologies (Private) Limited , and its minority-owned affiliate Premier BPO, Inc. (a Variable Interest Entity referred to as “PBPO”) and its wholly-owned Chinese subsidiary, Premier BPO Tianjin Co., Ltd. are collectively referred to as "we," “us” “our” or similar terms.

The following statements are or may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995:

(i) any statements contained or incorporated herein regarding possible or assumed future results of operations of our business, anticipated cost savings or other synergies, the markets for our services and products, anticipated capital expenditures, regulatory developments or competition; (ii) any statements preceded by, followed by or that include the words "intends," "estimates," "believes," "expects," "anticipates," "should," "could," “projects,” “potential,” or similar expressions; and (iii) other statements contained or incorporated by reference herein regarding matters that are not historical facts.

Such forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, included in Management's Discussion and Analysis of Financial Condition and Results of Operations and elsewhere in this Form 10-Q, which reflect management's best judgment based on factors currently known, involve risks and uncertainties. The Company's actual results may differ significantly from the results discussed in the forward-looking statements and their inclusion should not be regarded as a representation by us or any other person that the objectives or plans will be achieved. Factors that might cause such a difference include, but are not limited to:

(i) a significant portion of our sales continuing to be to certain large customers, (ii) continued dependence by us on certain allied distributors, (iii) continued downward pricing pressures in the information technology market, (iv) our ability to maintain inventory and accounts receivable financing on acceptable terms, (v) quarterly fluctuations in results, (vi) seasonal patterns of sales and client buying behaviors, (vii) changing economic influences in the industry, (viii) the development by competitors of new or superior delivery technologies or entry in the market by new competitors, (ix) dependence on intellectual property rights, (x) delays in product development, (xi) our dependence on key personnel, (xii) potential influence by executive officers and principal stockholders, (xiii) volatility of our stock price, (xiv) delays in the receipt of orders or in the shipment of products, (xv) any delay in execution and implementation of our system development plans, (xvi) loss of minority ownership status, (xvii) planned or unplanned changes in the quantity and/or quality of the suppliers available for our products, (xviii) changes in the costs or availability of products, (xix) interruptions in transport or distribution, (xx) general business conditions in the economy, (xxi) our ability to prevail in litigation, and (xxii) losses from foreign currency fluctuation, limitations on foreign asset transfers and changes in foreign regulations and political turmoil.

Assumptions relating to budgeting, marketing, and other management decisions are subjective in many respects and thus susceptible to interpretations and periodic revisions based on actual experience and business developments, the impact of which may cause us to alter our marketing, capital expenditure or other budgets, which may in turn affect our business, financial position, results of operations and cash flows. The reader is therefore cautioned not to place undue reliance on forward-looking statements contained herein and to consider other risks detailed more fully in our most recent Annual Report on Form 10-K, as amended, for the fiscal year ended September 30, 2008. We undertake no obligation to publicly release the result of any revisions to these forward-looking statements which may be made to reflect events or circumstances after the date hereof, or to reflect the occurrence of unanticipated events.

Critical Accounting Policies

There have been no major changes to our critical accounting policies since the disclosure of critical accounting policies made in the September 30, 2008 Annual Report on Form 10-K, as amended.

Comparisons of Financial Results

The following table sets forth certain financial data as a percentage of net sales for the periods indicated:

	Three Months Ended						Six Months Ended
	March 31,						March 31,
	2009			2008			2009			2008
Net sales:
Product		93.8	%		82.9	%		94.7	%		84.2	%
Services		6.2			17.1			5.3			15.8
Total net sales		100.0			100.0			100.0			100.0
Gross profit:
Product		11.5			8.6			11.2			7.8
Services		1.9			7.0			1.7			6.7
Total gross profit		13.4			15.6			12.9			14.5
Selling and marketing expenses		10.1			13.6			9.5			11.7
General and administrative expenses		6.9			5.5			5.5			4.4
Operating loss		(3.6	)		(3.5	)		(2.1	)		(1.6	)
Interest (expense) income, net		0.0			0.0			0.0			0.1
Other (expense) income, net		4.3			(0.8	)		1.9			(0.3	)
Income (Loss) before taxes and other items		0.7			(4.3	)		(0.1	)		(1.9	)
(Benefit) provision for income taxes		0.0			0.0			0.0			0.0
Income (loss) before other items		0.7			(4.3	)		(0.1	)		(1.9	)
Allocated income from equity investment		0.2			(0.0	)		0.1			(0.0	)
Allocated loss (income) to noncontrolling interest		0.0
Net income (loss)		0.9	%		(4.3	)%		0.0	%		(1.9	)%

Comparison of the Results of Operations for the Three Months and Six Months Ended March 31, 2009 and 2008

NET SALES

NET SALES COMPARISONS
	Three Months Ended							Six Months Ended
	March 31,							March 31,
Period-to-Period Comparison	Change			2009		2008		Change			2009		2008
Net sales:
Product	$	(15.4	)	$	43.1	$	58.5	$	(37.1	)	$	95.5	$	132.6
Services	$	(9.3	)	$	2.8	$	12.1	$	(19.5	)	$	5.3	$	24.8
Total	$	(24.7	)	$	45.9	$	70.6	$	(56.6	)	$	100.8	$	157.4
Percentage change		(35.0	)%						(36.0	)%

				March 31,		December 31,
Sequential Comparison	Change			2009		2008
Net sales:
Product	$	(9.3	)	$	43.1	$	52.4
Services	$	0.3		$	2.8	$	2.5
Total	$	(9.0	)	$	45.9	$	54.9
Percentage change		(16.4	)%

Net sales decreased $24.7 million, or 35.0%, in the March 2009 quarter as compared to the March 2008 quarter, with decreases in net sales of both product and services. Of the $24.7 million decline in net sales, $9.3 million resulted from the absence of service revenue that is now reported by EP Global as a result of the divestiture of the IT services business in July 2008 (see "Note 7 - Equity Investment"). Service revenues are now limited to those provided by PBPO for the selling of business process outsourcing services of $1.5 million in the March 2009 quarter, vendor configuration services, third-party product maintenance agreement sales (a combined $1.1 million in the March 2009 quarter) and a small amount of business outsourcing services as provided by Ovex of $0.2 million in the March 2009 quarter. The remaining $15.4 million decline in net product sales, or 26.3%, is reflective of the loss of some major customers that were replaced by new customers making less purchases, as well as sharp reductions in spending by other major customers.

The decline in net sales can be assessed by a review of our top twenty customers that accounted for 52% of core net sales revenues ("core" defined as sales of other than sales of business process outsourcing services and product and service revenue from foreign subsidiaries) during both March fiscal quarters. Eleven new top twenty customers were added to the mix in the March 2009 quarter while eleven were dropped from the March 2008 quarter. However, the added new top twenty customers that replaced those lost from the prior March quarter contributed $1.4 million less in net sales, or 9.6% less, than in the comparable prior March quarter. The decline in net sales was much more pronounced in the remaining nine repeat top twenty customers from the March 2008 fiscal year quarter. The decline in their net sales amounted to $6.9 million in the March 2009 quarter over the March 2008 quarter, or 42.0% less. The drop in the large repeat enterprise customers of 42.0% was much greater than that found in the remaining customer base. Sales to customers outside of the top twenty decreased $7.5 million to $20.4 million, or 26.9%, from the $27.8 million in the March 2008 quarter.

Software sales in the March 2009 quarter continued to increase as a percentage of total product net sales. For the March 2009 quarter, software sales were 35.0% of total net product sales as compared with 30.8% of total net product sales in the March 2008 quarter. Software sales, including licenses, maintenance, and agency commissions related thereto, decreased $2.9 million in the March 2009 quarter to $15.1 million from $18.0 million in the March 2008 quarter.

Our non-core net sales were essentially flat with $2.1 million of revenues recorded in the March 2009 quarter as compared with $1.6 million of revenues in the March 2008 quarter.

On a sequential basis, net sales decreased $9.0 million, or 16.4%, when compared with the December 2008 quarter, as a result of decreased product revenue.

For the six months ended March 31, 2009, net sales followed a similar pattern as in the second quarter of fiscal 2009 and 2008, decreasing $56.6 million, or 36.0%, as compared with the first six months of fiscal 2008. Of the $56.6 million decrease in net sales for the six months ended March 31, 2009 compared with the prior period in 2008, $19.5 million relates to the loss of the IT service business that was divested in July 2008. The remaining $37.1 million decrease, or 28.0%, was a result of losses in product net sales for the same reasons as discussed above for the second quarter of fiscal year 2009 results.

Net sales to one customer amounted to 10.6% in the March 2009 quarter, while no one customer accounted for more than 10% of sales in the March 2008 quarter. For the six months ended March 31, 2009 and 2008, no one customer accounted for more than 10% of net sales.

GROSS PROFIT

GROSS PROFIT COMPARISONS
	Three Months Ended									Six Months Ended
	March 31,									March 31,
Period-to-Period Comparison	Change			2009			2008			Change			2009			2008
Gross profit:
Product	$	(0.7	)	$	5.3		$	6.0		$	(1.0	)	$	11.3		$	12.3
Services	$	(4.1	)	$	0.9		$	5.0		$	(8.9	)	$	1.7		$	10.6
Total	$	(4.8	)	$	6.2		$	11.0		$	(9.9	)	$	13.0		$	22.9
Percentage change		(43.6	)%								(43.2	)%
Gross margin percentage:
Product		1.9	%		12.2	%		10.3	%		2.6	%		11.8	%		9.3	%
Services		(9.7	)%		31.3	%		41.3	%		(11.4	)%		31.4	%		42.7	%
Combined gross margin percentage		(2.1	)%		13.5	%		15.6	%		(1.7	)%		12.9	%		14.5	%

				March 31,			December 31,
Sequential Comparison	Change			2009			2008
Gross profit:
Product	$	(0.7	)	$	5.3		$	6.0
Services	$	0.1		$	0.9		$	.8
Total	$	(0.6	)	$	6.2		$	6.8
Percentage change		(8.8	)%
Gross margin percentage:
Product		0.7	%		12.2	%		11.5	%
Services		(0.3	)%		31.3	%		31.6	%
Combined gross margin percentage		1.1	%		13.5	%		12.4	%

Gross profits decreased $4.8 million in the March 2009 quarter, or 43.6%, to $6.2 million as compared with the $11.0 million in the March 2008 quarter. The majority of the decrease in gross profits was attributable to the decline in service revenues resulting from the divestiture of the IT service business in the fourth quarter of fiscal 2008. The $4.1 million decline in service gross profits in the March 2009 quarter compared with the March 2008 quarter approximates the $4.4 million of service revenues recognized by the IT service business transferred to EP Global (see "Note 7 - Equity Investment"). Product gross profits for the March 2009 quarter decreased $0.7 million to $5.3 million from the March 2008 quarter of $6.0 million. The $0.7 million decline in product gross profitswas attributable primarily to the $15.4 million decrease in product net sales, as the product gross margin percentage increased 1.9% to 12.2% from 10.3% in the March 2008.

Software agency commissions, provided chiefly by Microsoft, Inc., are recorded net of costs and have a major influence on product gross profits. As a result, the decrease in software agency commissions for the March 2009 quarter of $0.8 million over the March 2008 quarter to $1.6 million from $2.4 million was a drag on the 1.9% increase in product gross margin percentage of approximately 0.4%. The current decrease noted in software agency commissions follows the Company’s recent disclosure for the December 2008 quarter of an anticipated a future erosion of the agency commission fee structure from Microsoft, Inc. Software gross profits combined with agency commissions amounted to $2.6 million of the $5.3 million total gross profits for the March 2009 quarter.

SELLING AND MARKETING EXPENSES. Selling and marketing expenses decreased $4.9 million, or 51.4%, to $4.6 million in the March 2009 quarter, from $9.5 million in the March 2008 quarter. Most of the $4.9 million decrease is attributed to the absence of selling and marketing expenses related to the services business transferred to EP Global as EP Global incurred $4.1 million in selling and marketing expenses for the March 2009 quarter.

For the six months ended March 31, 2009 as compared with the same six month period in 2008, selling and marketing expenses were similarly reduced from the absence of EP Global expenses. Selling and marketing expenses for this period decreased $8.8 million, or 47.9%, to $9.6 million as compared with $18.4 million in the prior fiscal period.

Selling and marketing expenses as a percentage of net sales likewise decreased 3.5% to 10.1% in the March 2009 quarter from the 13.6% recorded in the March 2008 quarter. On a sequential basis, selling and marketing expenses remained relatively constant decreasing $0.3 million in the March 2009 quarter from the $4.9 million incurred in the December 2008 quarter.

GENERAL AND ADMINISTRATIVE EXPENSES. General and administrative expenses decreased $0.7 million, or 19.0%, to $3.2 million in the March 2009 quarter from the $3.9 million in the March 2008 quarter. The decrease was principally from the absence of general and administrative expenses related to the services business that was transferred to EP Global.

For the six months ended March 31, 2009, general and administrative expenses decreased $1.5 million to $5.5 million, or 20.8%, as compared with the $7.0 million incurred in the first six months of fiscal 2008. The decrease was again principally from the absence of general and administrative expenses related to the services business that was transferred to EP Global.

On a sequential basis, general and administrative expenses increased $0.8 million in the March 2009 quarter from the $2.4 million incurred in the December 2008 quarter. The sequential increase is due to the March 2009 quarter having incurred additional costs related to the pending merger proposal. Expressed as a percentage of net sales, general and administrative expenses increased 4.4% to 6.9%. The percentage increase was caused by the decrease in the net sales base upon which to spread the general and administrative costs.

OPERATING LOSS. The operating loss decreased $0.8 million in the March 2009 quarter to $1.6 million compared with a $2.4 million of operating loss in the March 2008 quarter. The decrease in the operating loss was a result of the $5.6 million decrease in operating expenses exceeding the $4.8 million decrease in gross profits.

For the six months ended March 31, 2009, the operating loss decreased $0.4 million to $2.1 million, or 14.1%, as compared with the $2.5 million operating loss in the first six months of fiscal 2008. The decrease was also because the decrease in operating expenses exceeded the decrease in gross profits for the period.

INTEREST (EXPENSE) INCOME, NET. For the three months and six months ended March 31, 2009 and 2008, net interest (expense) income was as follows (in thousands):

	Three Months Ended						Six Months Ended
	March 31,						March 31,
	2009			2008			2009			2008

Interest income	$	43		$	48		$	100		$	188
Interest expense		(48	)		(73	)		(85	)		(147	)
	$	(5	)	$	(25	)	$	15		$	41

Interest income results principally from short-term money market investments earned from excess cash holdings and short-term cash investments. Interest expense results principally from lease financing.

OTHER INCOME (EXPENSE), NET. For the three months and six months ended March 31, 2009 and 2008, net other income was as follows (in thousands):

	Quarter Ended							Six Months Ended
	March 31,							March 31,
	2009				2008			2009			2008

Gain on sale of service business	$	2,000		$	--			$	2,000		$	--
Gain on sale of Indian subsidiary		38							38			--
Loss on note receivable		--				(500	)		--			(500	)
Prepaid lease amortization on investment		(75	)			(50	)		(150	)		(50	)
Other income		12				(17	)		58			44

Total net other income (expense)	$	1,975		$		(567	)	$	1,946		$	(506	)

Net other income increased $2.5 million in both the March 2009 quarter as compared to the March 2008 quarter and in the six months ended March 31, 2009 as compared with the six months ended March 31, 2008. The increases were from the gain on the sale of the service business, the gain on the sale of En Pointe Technologies India Pvt. Ltd (a majority owned subsidiary that took place in the March 2009 quarter) and the presence in the fiscal 2008 periods of a loss on a note receivable. The $2.0 million gain on the sale of the service business relates to the July 9, 2008 sale of an 80.5% interest in EP Global. Two million dollars of the gain from the sale had been deferred until payment was forthcoming. The Indian subsidiary performed programming services for our internal use and was sold to Allied Digital Services, Ltd., the 80.5% partner in EP Global. The sale of the Indian subsidiary, which was effective as of January 1, 2009, closed on March 31, 2009 and the proceeds from the sale, 2,039,048 Indian Rupees (which was estimated at $41,000) are payable on June 30, 2009.

BENEFIT FOR INCOME TAXES. For the March 2009 quarter, we estimated a net income tax benefit of $18,000 for the quarter. The tax benefit reflects the potential of a federal tax refund from the $114,000 of federal income taxes paid in the prior fiscal year of which one quarter, or $28,500 has been recognized for the quarter, reduced by estimated state minimum income taxes of $10,500. For the six months ended March 31, 2009, $57,000 federal tax benefit has been recognized reduced by $13,500 of state minimum income taxes.

As of March 31, 2009, there were no available federal net operating loss carry forwards as all net operating loss carryforwards were applied in full in the prior fiscal year.

ALLOCATED LOSS (INCOME) TO NONCONTROLLING INTERESTS. Under FIN 46 and other recent changes in consolidation principles, certain noncontrolling interests are required to be consolidated. We own an approximate 30% voting interest in PBPO as of March 31, 2009 and under FIN 46 are required to consolidate PBPO’s financial results in our financial statements. In the second quarter of fiscal 2009 and in the six months of fiscal 2009, PBPO incurred losses that were allocated to the noncontrolling interest.

Ovex, which is 70% owned by us, was profitable for the second quarter of fiscal 2009 of which 30% has been allocated to noncontrolling interest. For the six months ended March 31, 2009 Ovex incurred losses of which 30% has been allocated to the noncontrolling interest.

For the three months and six months ended March 31, 2009 and 2008, allocations to noncontrolling interest was as follows (in thousands):

	Three Months Ended					Six Months Ended
	March 31,					March 31,
	2009			2008		2009		2008

PBPO	$	10		$	--	$	9	$	21
Ovex		(1	)		10		19		(54	)
Loss (profit) allocations	$	9		$	10	$	28	$	(33	)

NET INCOME (LOSS). For the March 2009 quarter net income of $0.4 million was realized as compared with a net loss of $3.0 million in the March 2008 quarter. The increase approximate of $3.4 million net income for the March 2008 quarter was due primarily a decline in operating loss of $0.8 million and $2.6 million increase in non-operating income. For the six months ended March 31, 2009, net income increased $3.0 million from a decline in operating loss of $0.3 million and $2.7 million increase in non-operating income.

Liquidity and Capital Resources

Sources of liquidity for us include cash and cash equivalents, cash flow from operations, and amounts available under our GE and IBM financing facilities. These sources have been adequate for day-to-day operations and for capital expenditures. Although there can be no assurance, management believes that the remaining cash balances, cash flows from operations, and availability of funds under our financing facilities will be sufficient to satisfy our operating requirements for the next fiscal year. As of March 31, 2009, we had approximately $8.2 million in cash and working capital of $5.6 million.

Cash flows from operating activities:

During the six months ended March 2009, operating activities provided cash totaling $3.0 million as compared with $16.9 million in the comparable period of the prior fiscal year. The primary reason for the $13.9 million net decrease in cash from operating activities was the decrease of $14.0 million of accounts receivable that generated cash in the

six month period ended March 2008 whereas in the comparable fiscal year 2009 period there was a $4.0 million increase in accounts receivable, providing a net decrease of $10.0 million. In addition, the increases in inventory had a $5.0 million net adverse effect on operating cash when comparing the March 2009 and 2008 six month periods.

Accounts receivable, net of allowances for returns and doubtful accounts, at March 31, 2009 and 2008, was $34.1 million and $47.0 million, respectively, a decrease of $12.9 million. The number of days’ sales, or DSOs, outstanding in accounts receivable was 62 and 57, as of March 31, 2009 and 2008, respectively. The increase in DSOs was due to the slowing in payments from customers. While we have experienced improvements in the customer ageing in current, 30 day past due, and 60 day past due categories, the over 90 day past due has increased. Over 90 day past due has arisen to 8%, or $3.3 million, of total receivables in the March 2009 quarter as compared with 2% in the March 2008 quarter. Almost half of the $3.3 million, or $1.5 million has been specifically set aside for customers that are doubtful for collection or in bankruptcy. The remaining represent customers that have become slower pay.

Cash flows from investing activities:

Investing activities used cash totaling $0.6 million during the six months ended March 2009, a decrease of $0.6 million from that expended in the prior fiscal year period. The $0.6 million decrease resulted principally from the reduction in the purchase of property and equipment of $0.9 million offset by the absence in the March 2009 six month period of net expenditures for investments of $0.5 million that was present in the March 2008 six month period.

Cash flows from financing activities:

Financing activities provided net cash totaling $2.1 million in the six months ended March 2009, as opposed to the $18.8 million of cash that was used from financing activities

primarily in the net repayment of credit facilities in the prior fiscal year period. The total $20.9 million increase in cash provided in the fiscal 2009 period over the fiscal 2008 period was from the increased borrowings under lines of credit and our export loan.

Credit facilities:

Our two primary information technology sales subsidiaries, En Pointe Technologies Sales, Inc. and En Pointe Gov, Inc., and GE Commercial Distribution Finance Corporation (“GE”) are parties to that certain Business Financing Agreement and that certain Agreement for Wholesale Financing dated June 25, 2004 with various subsequent amendments to date (collectively, the “Agreements”). En Pointe Technologies, Inc. is the guarantor of the obligations under the Agreements. Under the flooring arrangement, the two subsidiaries may purchase and finance information technology products from GE-approved vendors on terms that depend upon certain variable factors. The two subsidiaries may borrow up to 85% of their collective eligible accounts receivable at an interest rate of prime plus 1.0% per annum, subject to a minimum rate of 5.0%. Such purchases from GE-approved vendors have historically been on terms that allow interest-free flooring.

An addendum, effective July 25, 2007 provides for a $45.0 million accounts receivable and flooring facility. The addendum also provides an extension of the term of the facility for a period of three years from August 1, 2007 and for successive one-year renewal periods thereafter, subject to termination at the end of any such period on at least sixty days prior written notice by any party to the other parties. Effective September 25, 2007, the parties entered into another addendum to delete all prior financial covenants contained in the Agreements and to restate them effective for the last day of each calendar quarter as follows (as such terms are defined in the Agreements):

	•		Tangible Net Worth and Subordinated Debt in the combined amount of not less than $12,750,000.

	•		Total Funded Indebtedness to EBITDA for the preceding four fiscal quarters then ended, shall be no more than 3.00:1.00.

We were in compliance with all of the debt covenants under the GE Agreements, as amended and supplemented to date, as of March 31, 2009.

The GE facility is collateralized by accounts receivable, inventory and substantially all of our other assets. As of March 31, 2009, approximately $8.7 million in borrowings were outstanding under the $45.0 million financing facility. At March 31, 2009, there were additional borrowings available of approximately $18.0 million after taking into consideration the borrowing limitations under the Agreements, as amended to date.

In addition to the GE facility, on March 26, 2008 En Pointe Technologies Sales, Inc. entered into an agreement for inventory financing with IBM that may only be used to finance sales to International Business Machines Corporation and/or IBM Global Services. Under the agreement the subsidiary may borrow up to $25 million of certain eligible accounts receivable and inventory. Interest free financing is provided with the number of days of interest free financing depending on the vendor and product purchased. Beyond the interest free financing period, interest is charged at the prime rate plus 6.5% per annum. The agreement is collateralized by accounts receivable, inventory and substantially all other assets. En Pointe Technologies, Inc., has provided its guarantee to IBM for the inventory financing Agreement. In conjunction with this financing Agreement, GE and IBM, have signed Intercreditor Agreements. The IBM financing agreement contains numerous covenants including the method of financial reporting to IBM. In addition there are two financial covenants:

Total subordinated debt and tangible net worth (both as defined under the Agreement) must be equal to or greater than $12,250,000.

Funded debt (as defined under the Agreement) divided by EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) must be less than or equal to 3.5:1.0

We were in compliance with all of the debt covenants under the IBM financing agreement as of March 31, 2009.

Off-Balance Sheet Arrangements

We do not currently have any off-balance sheet arrangements within the meaning of Item 303(a)(4) of Regulation S-K.

Item 4T. Controls and Procedures

We maintain disclosure controls and procedures (as defined in Rules 13a-15(e) and 15(d)-15(e) under the Securities Exchange Act of 1934) that are designed to ensure that information required to be disclosed in our reports under the Securities Exchange Act of 1934, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

(a) Evaluation of disclosure controls and procedures

Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) of the Securities Exchange Act of 1934. Based on this evaluation and solely because we were unable to complete the required management’s report on internal control over financial reporting in our Annual Report on Form 10-K for the fiscal year ended September 30, 2008 due to our limited resources at the time, which failure was not remedied prior to the end of the fiscal quarter covered by this Quarterly Report on Form 10-Q, our principal executive officer and principal financial officer concluded that, as of March 31, 2009, the Company’s disclosure controls and procedures were not effective.

On April 30, 2009, we filed an amendment to our Annual Report on Form 10-K for the fiscal year ended September 30, 2008 that included a complete management’s report on internal control over financial reporting and indicated that we believed that, as of April 28, 2009, we had corrected all material weaknesses in our internal control over financial reporting identified in such report.

A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all our control issues have been detected. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

(b) Changes in internal controls

As reported in our Annual Report on Form 10-K for the fiscal year ended September 30, 2008, as amended, our management evaluated the effectiveness of our internal control over financial reporting (ICFR) as of September 30, 2008 based on the control criteria established in a report entitled Internal Control — Integrated Framework, issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, our management concluded that our internal control over financial reporting was not effective as of September 30, 2008 due to the following material weaknesses in internal control over financial reporting:

·	ineffective controls over changes and access to financial reporting applications and related sub systems;

·	an insufficient level of information technology personnel to execute general computing controls over our information technology structure; and

·	an insufficient level of experienced personnel to timely execute our annual assessment of internal controls over financial reporting.

A material weakness in internal control over financial reporting is defined by the Public Company Accounting Oversight Board’s Audit Standard No. 5 as being a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis.

Our audit committee and management instituted steps during the fiscal quarter ended March 31, 2009 to remediate all of the material weaknesses in our internal control over financial reporting as of September 30, 2008 identified in our management’s report on internal control over financial reporting in our Annual Report on Form 10-K for the fiscal year ended September 30, 2008, as amended. We hired additional temporary staff and arranged for the use of financial and IT consultants to provide us with the assistance necessary to remediate the material weaknesses. We developed a remediation plan to address these material weaknesses. The plan consists of the following elements:

·	Implementation of an application to document and track significant changes to information technology (“IT”) applications and related subsystems;

·	Issuance and monitoring of policies and procedures for significant IT activities relating to change management, operations and security, including the disposal of IT assets;

·	Allocation of additional resources to complete documentation, testing and remediation of the general computing controls over our IT structure;

·	Outsourcing of the monitoring of our IT network and firewall to a reputable third party vendor; and

·	Updated password policies related to our financial reporting applications and related operating systems.

As of April 28, 2009, we have completed the remedial actions addressed by the plan, and accordingly believe that as of such date we have corrected the material weaknesses identified as of September 30, 2008. We intend to continue to allocate a sufficient level of resources to ensure that our internal control structure is maintained and functions properly and effectively.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

Item 6. Exhibits

31.1	Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of the Chief Executive and Chief Financial Officers Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

En Pointe Technologies, Inc.

By:	/s/ Javed Latif
	Senior Vice President and Chief Financial Officer
	(Duly Authorized Officer and Principal Financial Officer)

Date: May 15, 2009

EN POINTE TECHNOLOGIES INC 10-Q