UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

_____________

FORM 10-Q/A

(MARK ONE)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934

FOR THREE MONTH PERIODS ENDED NOVEMBER 30, 2008 AND NOVEMBER 30, 2007

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

COMMISSION FILE NUMBER: 001-15783

_____________

CASH TECHNOLOGIES, INC.

(Exact name of registrant as specified in its charter)

DELAWARE	95-4558331
(State or other jurisdiction of incorporation organization)	(IRS Employer Identification No.)

1434 W. 11 TH STREET, LOS ANGELES, CA	90015
(Address of principal executive offices)	(Zip Code)

(213) 745-2000

(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 o

_____________

Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date.

On January 20, 2009, there were 24,753,726 shares of common stock, $ .01 par value per share, issued and outstanding.

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

Yes o No x

CASH TECHNOLOGIES, INC.

FORM 10-Q

INDEX

		PAGE NO.

PART I. FINANCIAL INFORMATION

Item 1.	Condensed Consolidated Financial Statements:

	Condensed Consolidated Balance Sheets as of November 30, 2008 (unaudited) and May 31, 2008	3

	Condensed Consolidated Statements of Operations for the three and six month periods ended November 30, 2008 and November 30, 2007 (unaudited)	4

	Condensed Consolidated Statements of Cash Flows for the six month periods Ended November 30, 2008 and November 30, 2007 (unaudited)	5

	Notes to Condensed Consolidated Financial Statements for the three and six month periods ended November 30, 2008 and November 30, 2007 (unaudited)	6

Item 2.	Management's Discussion and Analysis of Financial Condition, Results of Operations, and Risk Factors	12

Item 4.	Controls And Procedures	22

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	22

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	23

Item 3.	Defaults Upon Senior Securities	23

Item 4.	Submission of Matters to a Vote of Security Holders	23

Item 5.	Other Information	24

Item 6.	Exhibits and Reports on Form 8-K	24

SIGNATURES		25

Index

PART I

ITEM 1. FINANCIAL STATEMENTS

CASH TECHNOLOGIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

	NOVEMBER 30,			MAY 31,
	2008			2008
	(Unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	177,492		$	410,305
Accounts receivable		406,395			128,622
Prepaid expenses and other current assets		524,834			529,896
Other receivable (net of allowance $50,000)		176,197			118,456
Inventory		13,234,311			11,967,341
Assets of discontinued operations
Cash		41			41
Prepaid expenses and other current assets		90,000			117,000
Inventory (net of allowance $121,000)		93,553			93,553
Other assets		18,230			18,230
Total assets of discontinued operations		201,824			228,824

Total Current Assets		14,721,053			13,383,444

CoinBank machines held for sale		464,890			609,890

PROPERTY AND EQUIPMENT (net)		1,519			3,027

HPS PREFERRED STOCK		218,401			218,401

CLAIMREMEDI PREFERRED STOCK		3,500,000			3,500,000

OTHER ASSETS		228,743			-

TOTAL ASSETS	$	19,134,606		$	17,714,762


LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)
CURRENT LIABILITIES:
Current maturities of Notes Payable (Note 5)	$	3,938,524		$	3,938,524
Due to Officers and Directors		8,915			8,915
Convertible debt (Note 6)		110,012			147,337
Due to Shareholders (Note 4)		569,823			398,805
Accounts payable		844,311			894,202
Accrued liabilities		3,421,685			1,956,702
Dividend payable		562,077			461,246
Liabilities of discontinued operations
Notes payable		336,344			336,344
Total liabilities of discontinued operations		336,344			336,344

Total Current Liabilities		9,791,691			8,142,075

Long-Term Notes Payable (Note 6)		3,152,180			1,933,673

TOTAL LIABILITIES		12,943,871			10,075,748

MINORITY INTEREST		(129,189	)		(122,640	)
TOTAL MINORITY INTEREST		(129,189	)		(122,640	)

STOCKHOLDERS' EQUITY (DEFICIENCY):
Stockholder's equity of discontinued operations
Additional paid in capital		979,367			979,367
Accumulated equity		(1,113,887	)		(1,086,887	)
Total stockholder's equity of discontinued operations		(134,520	)		(107,520	)


Cumulative Redeemable Preferred Stock, 1,500,000 shares authorized, 649,045 shares issued and outstanding at Aug 31, 2008 and Aug 31, 2007		11,031,811			10,906,811

Common Stock, $0.01 par value, 65,000,000 shares authorized, 24,753,726 and 24,442,976 shares issued and outstanding at Aug 31, 2008 and Aug 31, 2007		368,132			368,132

Additional Paid-In-Capital		42,255,361			42,265,826
Accumulated Deficit		(47,200,859	)		(45,671,595	)

Total stockholders' Equity		6,319,925			7,761,654

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)	$	19,134,606		$	17,714,762

See notes to consolidated financial statements

Index

CASH TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

	THREE MONTH PERIOD ENDED						THREE SIX PERIOD ENDED
	NOVEMBER 30,						NOVEMBER 30,
	2008			2007			2008			2007
							(Unaudited)


NET REVENUES	$	453,840		$	35,348		$	675,429		$	78,935
COST OF REVENUES		355,448			22,669			758,418			48,243

GROSS PROFIT (LOSS)		98,392			12,679			(82,989	)		30,692

SELLING, GENERAL, & ADMINISTRATIVE EXPENSE		572,605			753,919			1,035,552			1,500,703
Impairment of Investment in BIPS		-			-			-			2,000,000
GAIN ON SALE OF HPS/CDHC STOCK		-			(79,580	)		-			(79,580	)
GOODWILL CHARGEOFF		200,000						200,000
GAIN ON INVENTORY		-						-
RESEARCH AND DEVELOPMENT		-			18,750			-			37,500
DEPRECIATION & AMORTIZATION EXPENSE		120,650			406			390,145			1,160

OPERATING LOSS		(794,863	)		(680,816	)		(1,708,686	)		(3,429,091	)

OTHER INCOME

INTEREST EXPENSE		44,757			179,331			169,961			252,752

PROFIT/(LOSS) BEFORE INCOME TAXES		(839,620	)		(860,147	)		(1,878,647	)		(3,681,843	)

INCOME TAXES					-						-

MINORITY INTEREST (Note 9)		-			(6,291	)		(6,549	)		(12,840	)

NET INCOME (LOSS) FROM CONTINUING OPERATIONS	$	(839,620	)	$	(853,856	)	$	(1,872,098	)	$	(3,669,003	)

DISCONTINUED OPERATIONS
NET REVENUES	$	-		$	-		$	-
FORGIVENESS OF DEBT		-			-			-
COST OF REVENUES		-			-			-
SELLING, GENERAL & ADMINISTRATIVE EXPENSE		-			(18,579	)		-			293,791
INTEREST EXPENSE		-			(13,403	)		-			(35,702	)
GAIN (LOSS) FROM DISPOSITION OF SUBSIDIARY'S ASSETS		-			-			-			-
WIRTE OFF OF LONG OUTSTANDING
ESTIMATED LIIABILITIES		-			312,500			-			-
GAIN/(LOSS) FROM WRITE OFF OF LONG TERM NOTE		-			420,545			-			(7,518,118	)
Extraordinary Gain on purchase of CPI assets		-			-			-
INCOME (LOSS) FROM DISCONTINUED OPERATIONS		-			701,063			-			(7,260,029	)

NET INCOME (LOSS)	$	(839,620	)	$	(152,793	)	$	(1,872,098	)	$	(10,929,032	)

Dividends & deemed dividends	$	50,000		$	50,000		$	100,831		$	100,000

Net income (loss) allocable to common shareholders	$	(889,620	)	$	(202,793	)	$	(1,972,929	)	$	(11,029,032	)

Basic and diluted net income (loss) per share before discontinued operations	$	(0.04	)	$	(0.01	)	$	(0.08	)	$	(0.32	)

Basic and diluted net income (loss) per share for discontinued operations	$	-		$	-		$	-		$	(0.32	)

Basic and diluted weighted average shares of common stock outstanding		24,753,726			34,671,863			24,753,726			34,671,863

See notes to consolidated financial statements

Index

CASH TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

	PERIOD ENDED
	NOVEMBER 30,
	2008			2007
	(Unaudited)
OPERATING ACTIVITIES:
Net loss	$	(443,146	)	$	(10,929,032	)
Adjustments to reconcile net loss to net cash used by operating activities:
Bad Debt Expense-discontinued operations		-			7,938,663
Impairment of investment in BIPS		-			2,000,000
Gain on sale of investment		-			(79,580	)
Minority interest		(6,549	)		(12,840	)
Amortization deemed interest expense		211,984			10,907
Depreciation expense		1,508			1,160
Other Assets	$	(228,743	)		-

Changes in operating assets and liabilities:
Accounts receivable	$	(277,773	)		(10,323	)
Inventory	$	(1,267,330	)		-
Coinbank Machinery Held for Sale		145,000			-
Prepaid expenses and other current assets		5,062			(21,000	)
Other receivable		(57,741	)		(10,427	)
Accrued interest		(47,931	)		47,068
Accounts payable		(49,891	)		(564,058	)
Change in net assets of business held for sale		27,000			(678,634	)
Accrued expenses and other current liabilities		2,086,599			713,615
Net cash provided by (used in) operating activities		98,049			(1,594,481	)

INVESTING ACTIVITIES:

Proceeds from sale of investment		-			500,000
Purchase of property and equipment		-			(3,486	)

Net cash provided by (used in) investing activities		-			496,514

FINANCING ACTIVITIES:

Net proceeds from issuance of preferred stock		125,000			-
Proceeds from Long-term debt		-			260,000
Proceeds from short term debt		-			(78,100	)
Repayments on short-term debt		(400,573	)		-
Repayments on long-term debt		(55,289	)		-
Proceeds from sale of common stock		-			86,310

Net cash provided by (used in) financing activities		(330,862	)		268,210

CHANGE IN CASH AND CASH EQUIVALENTS		(232,813	)		(829,757	)

Cash and Cash Equivalents, Beginning of Period		410,305			1,107,649

Cash and Cash Equivalents, End of Period	$	177,492		$	277,892


SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Income taxes		2,400			-

SUPPLEMENTAL DISCLOSURE OF NONCASH TRANSACTIONS

Gain (Loss) on operations of discontinued operations	$	-		$	(7,492,949	)
Dividends declared on preferred stock	$	100,831		$	100,000

See notes to consolidated financial statements

Index

CASH TECHNOLOGIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

NOTE 1: GENERAL

GOING CONCERN:

We have prepared the financial statements included in this Form 10-Q assuming that we will continue as a going concern. Although we have raised additional capital since our initial public offering in July 1998, we have never generated sufficient revenue-producing activities to sustain our operations. Accordingly, we must raise significant capital to fund current operations and to repay existing debt. Our auditors have included an explanatory paragraph in their report for the year ended May 31, 2008, indicating there is substantial doubt regarding our ability to continue as a going concern. The accompanying consolidated financial statements do not include any adjustments that might result from the outcome of any uncertainty.

PRESENTATION OF INTERIM INFORMATION:

In the opinion of the management of Cash Technologies, Inc. (“Cash Tech” or the "Company"), the accompanying unaudited condensed consolidated financial statements include all normal adjustments considered necessary to present fairly the financial position as of November 30, 2008 and the results of operation and cash flows for the three and six-month periods ended November 30, 2008 and November 30, 2007. Interim results are not necessarily indicative of results to be expected for any subsequent quarter or for the entire fiscal year.

The condensed consolidated financial statements and notes are presented as permitted by Form 10-Q. These condensed financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC"). Certain information and footnote disclosures, normally included in financial statements prepared in accordance with generally accepted accounting principles, have been omitted pursuant to such SEC rules and regulations. These financial statements should be read in conjunction with the Company's audited financial statements and the accompanying notes included in the Company's Form 10-KSB for the year ended May 31, 2008, filed with the SEC. The results of operations for the three and six-month periods ended November 30, 2008, are not necessarily indicative of the results to be expected for any subsequent quarter or for the entire fiscal year.

The research and development of new software products and enhancements to existing software products were expensed as incurred (and recorded in the consolidated statement of operation) until technological feasibility has been established. Technological feasibility is established upon completion of a detailed program design or working model. Amortization of the capitalized software commenced on January 1, 2002. As of May 31, 2008, capitalized software costs had been fully amortized. Technological feasibility was achieved in September of 1999 and commencing October 1, 1999 all expenses related to EMMA software development had been capitalized. As of December 31, 2001, we had capitalized $2,771,536 in development and related costs. The EMMA product was available for release to the public in January 2002 thus all development costs since have been expensed.

Recent Accounting Pronouncements

In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements (“SFAS 157”). SFAS 157 defines fair value, establishes a framework for measuring fair value and expands disclosure of fair value measurements. SFAS 157 applies under other accounting pronouncements that require or permit fair value measurements and, accordingly, does not require any new fair value measurements. SFAS 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007. We evaluated the impact of the adoption and determined that it does not have any impact on our current financial condition or results of operations.

Index

In February 2007, the Financial Accounting Board (FASB) issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities” (“SFAS 159”) which permits entities to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measured at fair value. SFAS 159 is effective for financial statements issued for fiscal years beginning after November 15, 2007. We evaluated the impact of the adoption and determined that it does not have any impact on our current financial condition or results of operations.

In June 2007, the Emerging Issues Task Force of the FASB issued EITF Issue no. 07-3, Accounting for Nonrefundable Advance Payments for Goods or Services to be Used in Future Research and Development Activities , (“EITF 07-3”) which is effective for fiscal years beginning after December 15, 2007. EITF 07-3 requires that nonrefundable advance payments for future research and development activities be deferred and capitalized. Such amounts will be recognized as an expense as the goods are delivered or the related services are performed. We evaluated the impact of the adoption and determined that it does not have any impact on our current financial condition or results of operations.

In December 2007, the FASB issued SFAS No. 141(R), Business Combinations (“SFAS No. 141(R)”), which requires entities to record fair value estimates of contingent consideration and certain other potential liabilities during the original purchase price allocation, expense acquisition costs as incurred and does not permit certain restructuring activities previously allowed under Emerging Issues Task Force Issue No. 95-3 to be recorded as a component of purchase accounting. SFAS 141(R) is effective for financial statements issued for fiscal years beginning after December 15, 2008. We have not determined the effect that the adoption of SFAS No. 141(R) will have on its consolidated financial statements, but the impact will be limited to any future acquisitions beginning in our 2010 fiscal year.

In December 2007, the FASB issued SFAS No. 160, Non-controlling Interests in Consolidated Financial Statements—an amendment of ARB No. 51 , (“SFAS No. 160”), which causes non-controlling interests in subsidiaries to be included in the equity section of the balance sheet. SFAS 160 is effective for financial statements issued for fiscal years beginning after December 15, 2008. We have not determined the effect that the adoption of SFAS No. 160 will have on its consolidated financial statements.

In March 2008, the FASB issued SFAS No. 161, "Disclosures about Derivative Instruments and Hedging Activities" ("SFAS No. 161"). SFAS 161 requires companies with derivative instruments to disclose information that should enable financial-statement users to understand how and why a company uses derivative instruments, how derivative instruments and related hedged items are accounted for under FASB Statement No. 133 "Accounting for Derivative Instruments and Hedging Activities" and how derivative instruments and related hedged items affect a company's financial position, financial performance and cash flows. SFAS 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008. We are currently evaluating the impact, if any, that SFAS 161 will have on our financial position or results of operations.

In May 2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted Accounting Principles (“SFAS No. 162”). SFAS 162 identifies a consistent framework, or hierarchy, for selecting accounting principles to be used in preparing financial statements that are presented in conformity with U.S. generally accepted accounting principles for nongovernmental entities (the “Hierarchy”). The Hierarchy within SFAS 162 is consistent with that previously defined in the AICPA Statement on Auditing Standards No. 69, “The Meaning of Present Fairly in Conformity With Generally Accepted Accounting Principles” (“SAS 69”). SFAS 162 is effective 60 days following the United States Securities and Exchange Commission’s (the “SEC”) approval of the Public Company Accounting Oversight Board amendments to AU Section 411, “The Meaning of Present Fairly in Conformity With Generally Accepted Accounting Principles”. The adoption of SFAS 162 will not have a material effect on our Consolidated Financial Statements because we have utilized the guidance within SAS 69.

In May 2008, the FASB issued SFAS No. 163, “Accounting for Financial Guarantee Insurance Contracts—an interpretation of FASB Statement No. 60 (“SFAS No. 163”). SFAS 163 requires recognition of an insurance claim liability prior to an event of default when there is evidence that credit deterioration has occurred in an insured financial obligation. SFAS 163 is effective for financial statements issued for fiscal years beginning after December 15, 2008, and all interim periods within those fiscal years. Early application is not permitted. Our adoption of SFAS 163 will not have a material effect on our Consolidated Financial Statements

Index

IMPAIRMENT OF BIPS

During the twelve months ended May 31, 2008, management concluded that due to adequate quarterly data no longer being available, that the resulting uncertainty requires us to take a 100% reserve on the BIPS investment. Although we believe that our investment in BIPS has the potential for returns previously indicated, we have concluded that we can no longer support the value of the investment under FSP 115-1.

NOTE 2. COMMITMENTS AND CONTINGENCIES

In 2001 we delivered stock certificates representing 700,000 shares to an escrow agent as collateral for a loan. The loan was never consummated, and in May 2001 we notified the transfer agent to cancel the shares. Thereafter the escrow agent, an attorney, died and we were never able to recover the certificates. In 2004 it came to our attention that a party was attempting to transfer 450,000 of the 700,000 shares. We immediately initiated a lawsuit in New York to prevent the transfer of the shares and have them retired. In December, 2004, we reached a settlement in which the shares would be returned to us without any exchange of money. We intend to similarly pursue the recovery of the remaining 250,000 shares, however in the event that we cannot achieve a satisfactory outcome in such effort, or in the event that the pending settlement is not consummated for any reason, some or all of these shares may be treated as outstanding and our Stockholders' Equity line item would have to be adjusted to reflect such additional shares.

NOTE 3: STOCKHOLDERS EQUITY

During the Quarter ended November 30, 2008 th Company raised $125,000 through the sale of the Company’s Preferred Stock.

NOTE 4: RELATED PARTY TRANSACTIONS

As of November 30, 2008, we were in arrears of approximately $473,000 for the salary to Mr. Korman, and owed $278,000 in accrued rent for our offices to a company in which Mr. Korman has a beneficial interest.

In addition, for the same period we were in arrears of approximately $32,000 for the salary to Mr. King.

NOTE 5: NOTE PAYABLE

In 1997, we entered into a credit agreement with G.E. Capital Corporation, or G.E. Capital, pursuant to which we borrowed $ 5,500,000 for the purchase of CoinBank component equipment, working capital and general corporate purposes. Due to our inability to repay G.E. Capital on the original terms, on September 29, 2000 we entered into the first of several loan modifications with G.E. The most recent modification requires interest-only payments at a rate of 11% until February 1, 2010 at which time the entire unpaid balance shall be due and payable. We have no current plan or capability to repay G.E. its principal. A default of this obligation could result in the delisting and/or bankruptcy of the Company. As of November 30, 2008, we owed G.E. Capital approximately $4 million, which includes the principal, financing fees and unpaid interest.

NOTE 6: CONVERTIBLE DEBT

In May 2003 we completed a private placement offering with a stockholder consisting of an unsecured convertible promissory note in the principal amount of $50,000, bearing interest at the rate of 5% per annum and redeemable Warrants to purchase 100,000 shares of common stock. The note is convertible into common stock at the conversion rate of $0.50 per share. The Warrants are exercisable at $1.00 per share. At that time we also reduced the exercise price of 8,000 Series C warrants owned by the stockholder from $2.50 to $0.25 per share. The note was due and payable on May 2, 2008. This note was converted on September 11, 2006 and was reclassified into equity.

Index

On May 22, 2007 we completed a private placement consisting of a convertible note, common stock and common stock warrants. The total placement was for $1,500,000 and consisted of:

a 6% interest 3 year convertible note for $1,200,000 with a conversion price of $1.05 per share,

$300,000 of common stock at $0.80 per share, or 375,000 shares of common stock,

common stock purchase warrants to purchase 759,000 shares of common stock at $1.75 per share

In May 2003 we completed a private placement offering with one of our stockholders consisting of convertible notes and warrants under Section 4(2) of the Securities Act of 1933. The offering consisted of an unsecured convertible promissory note in the principal amount of $50,000, bearing interest at the rate of 5% per annum and redeemable warrants to purchase 100,000 shares of common stock. The note is convertible into our common stock at the conversion rate of $0.50 per share. The Warrants are exercisable at a price of $1.00 per share. We also reduced the exercise price of 8,000 Series C warrants owned by the stockholder from $2.50 to $0.25 per share. The note is due and payable on May 2, 2008 and remains unpaid. A deemed dividend expense of $25,331 was recognized in conjunction with the warrants offered in this placement.

In May 2003 we completed a private placement offering with one of our stockholders consisting of convertible notes and warrants under Section 4(2) of the Securities Act of 1933. The offering consisted of an unsecured convertible promissory note in the principal amount of $20,750, bearing interest at the rate of 5% per annum and redeemable warrants to purchase 30,000 shares of common stock. The note is convertible into our common stock at the conversion rate of $0.50 per share. The Warrants are exercisable at a price of $0.65 per share. We also reduced the exercise price of 45,000 Series B warrants owned by the stockholder from $4.50 to $0.65 per share which were converted immediately for gross proceeds to us of $29,250. The note was due and payable on May 8, 2008 and remains unpaid. A deemed dividend expense of $25,901 was recognized in conjunction with the warrants offered in this placement.

As of November 30, 2008, we still owed $120,750 in principal and interest to the remaining noteholders. There can be no assurance that we will be able to pay the remaining noteholders when the notes are due and that the noteholders will not declare an event of default and demand immediate payment or seek to attach our assets, including our EMMA technology. (See Risk Factors).

In May 2008 we completed a private placement offering with 5 investors consisting of (i) convertible debentures totaling $1,590,000, convertible into common stock at $0.25 per share, with interest at 12% per annum payable quarterly, secured by the assets of CPI Holdings; and (ii) 5-year warrants to purchase 3.18 million shares of common stock, exercisable at $0.50 per share; and (iii) warrants expiring on November 7, 2008 to purchase 1.59 million shares of common stock exercisable at $.35 per share.

In accordance with EITF 98-05, “Accounting for Convertible Securities with Beneficial Conversion Features or Contingently Adjustment Conversion Ratios Abstract”, the Company allocated the proceeds according to the value of the convertible note and the warrants based on their relative fair values. Fair value of the warrants was determined using the Black-Scholes valuation model. For the 6-month warrants, risk-free interest rate used ranged from 1.64% to 1.74%, volatility rate ranged from 172% to 208%, and exercise price is $0.35. For the 5-year warrants, risk-free interest rate used ranged from 2.99% to 4.86%, volatility rate ranged from 406% to 593%, and exercise price is $0.75 and $0.50.

In accordance with EITF 00-27, “Application of Issue No. 98-5 to Certain Convertible Instruments”, the issue costs, value of the beneficial conversion feature and value of the warrants amounting to $150,440, $1,134,538 and $908,345, respectively, have been recorded as a discount to convertible notes and are being amortized over the term of the notes using the straight-line method. For the three months ended November 30, 2008, amortization of the discount was $7,072, $82,203 and $30,621, respectively. For the six months ended November 30, 2008, amortization of the discount was $14,067, $229,650 and $144,920, respectively. Unamortized debt discount as of November 30, 2008 are $114,542, $878,734 and $732,622, respectively

Index

NOTE 7: STOCK BASED COMPENSATION

Effective June 1, 2006 the Company adopted SFAS 123(R) using the modified prospective approach and accordingly prior periods have not been restated to reflect the impact of SFAS 123(R). Under SFAS 123(R), stock-based awards granted prior to its adoption will be expensed over the remaining portion of their vesting period. These awards will be expensed under the accelerated amortization method using the same fair value measurements which were used in calculating pro forma stock-based compensation expense under SFAS 123. For stock-based awards granted on or after June 1, 2006, the Company will amortize stock-based compensation expense on a straight-line basis over the requisite service period, which is five years.

SFAS 123(R) requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from initial estimates. Stock-based compensation expense has been recorded net of estimated forfeitures for such that expense was recorded only for those stock-based awards that are expected to vest. Previously under APB 25 to the extent awards were forfeited prior to vesting, the corresponding previously recognized expense was reversed in the period of forfeiture.

SFAS 123 requires the Company to provide pro-forma information regarding net loss as if compensation cost for the stock options granted to the Company’s employees had been determined in accordance with the fair value based method prescribed in SFAS 123. Options granted to non-employees are recognized in these financial statements as compensation expense under SFAS 123 using the Black-Scholes option-pricing model.

For the six month period ended November 30, 2008, the fair value of option grants is estimated on the date of grant utilizing the Black-Scholes option-pricing model with the weighted average assumption for options granted during 2003-2008, expected life of the option is 5 years, expected volatility of 134.46%, risk free interest rate of 3.76% and a 0% dividend yield. No option grants occurred during the period.

NOTE 8: SEGMENT REPORTING

We operate through two principal business segments: CPI Holdings, LLC and Veredi, Inc. (formerly Claim-Remedi Services, Inc.)

Information on our business segments for the:

	Three months ended						Six months ended
	November 30,						November 30,
Net revenues:	2008			2007			2008			2007
Veredi/CashTechCard,Coin Machines		79,748			35,348			118,837			78,935
CPI Holdings		374,092			-			556,592			-
Unallocated		-			-			-			-
		453,840			35,348			675,929			78,935

Interest expense:
Veredi/CashTechCard,Coin Machines		-			-			-			-
CPI Holdings		36,554			-			75,554			-
Unallocated		8,203			179,331			94,407			252,752
		44,757			179,331			169,961			252,752

Depreciation & Amortization:
Veredi/CashTechCard,Coin Machines		120,650			-			390,145			-
CPI Holdings		-			-			-			-
Unallocated		-			406			-			1,160
		120,650			406			390,145			1,160

Segment Income (loss):
Veredi/CashTechCard,Coin Machines		-			(853,856	)		-			(3,669,003	)
CPI Holdings		(276,647	)		-			(625,647	)		-
Unallocated		(562,973	)		-			(1,253,000	)		-
		(839,620	)		(853,856	)		(1,878,647	)		(3,669,003	)

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On May 5, 2008 CPI Holdings, LLC (dba Champion Parts) acquired assets of Champion Parts, Inc. for $2.97 million.

NOTE 9: MINORITY INTEREST

For the three month periods ended November 30, 2008 and November 30, 2007, we allocated $0 and $6,291 of losses in CT Holdings to minority interest. For the six month periods ended November 30, 2008 and 2007, we allocated $6,549 and $12,840 of losses in CT Holdings to minority interest.

NOTE 10: NOTE RECEIVABLE

On October 31, 2007, the Company's TAP Holdings, LLC (dba Tomco Auto Products) subsidiary sold most of its assets to competitor Champion Parts, Inc. TAP received $1.3 million in cash and a secured promissory note for $9.5 million subject to certain offsets to be paid over a maximum of 11 years, however, Champion defaulted on the note when it filed for Chapter 11 bankruptcy protection on October 10, 2007. Champion's bankruptcy and default of the $9.5 million secured note owed by Champion to TAP Holdings required us to write-off the adjusted $7.9 million remaining note balance.

On May 5, 2008 the Company’s CPI Holdings, LLC (dba Champion Parts) subsidiary acquired most of the assets of Champion Parts, Inc. from its lender, PNC Bank, following a court-ordered foreclosure, for $2.97 million. To fund the acquisition and working capital, Cash Tech raised approximately $3.4 million in debt and convertible debt.

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The acquired assets consist of finished goods, raw materials, component parts, all manufacturing and office equipment, furniture, computers, intangible assets such as the company name, IP, software, records, etc.

NOTE 11: SUBSEQUENT EVENTS

On December 23, 2008 Cash Tech’s CPI Holdings LLC subsidiary acquired certain turbocharger technology assets of Turbomotive, Inc. and Robert McKeirnan, its founder for $1.75 million. The purchase price was in the form of preferred stock with a face value of $1.65 million (subject to certain adjustments), with a conversion price equal to the market price of Cash Tech's common stock with a floor of $0.75 per share and a ceiling of $1.50 per share, and cash payments totaling $100,000 of which $40,000 was paid at closing. The assets acquired consist of patents, purchase orders, manufacturing processes, other intellectual property and tooling.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

SAFE HARBOR STATEMENT

In addition to historical information, the information included in this Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the ''Securities Act''), and Section 21E of the Securities Exchange Act of 1934, as amended (the ''Exchange Act''), such as those pertaining to the Company's capital resources, performance and results of operations. Forward-looking statements involve numerous risks and uncertainties and should not be relied upon as predictions of future events. Certain such forward-looking statements can be identified by the use of forward-looking terminology such as ''believes,'' ''expects,'' ''may,'' ''will,'' ''should,'' ''seeks,'' ''approximately”, ''intends,'' ''plans,'' ''pro forma,'' ''estimates,'' or ''anticipates'' or the negative thereof or other variations thereof or comparable terminology, or by discussions of strategy, plans or intentions. Such forward-looking statements are necessarily dependent on assumptions, data or methods that may be incorrect or imprecise and may be incapable of being realized. The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: significant and immediate need for capital, lack of revenue, market acceptance of the Company's products, technological restrictions upon development, limited marketing experience, uncertainty of product development, including our EMMA technology, dependence upon new technology, need for qualified management personnel and competition. The success of the Company also depends upon economic trends generally, governmental regulation, legislation, and population changes. Readers are cautioned not to place undue reliance on forward-looking statements, which reflect management's analysis only. The Company assumes no obligation to update forward-looking statements.

Introduction

Cash Technologies, Inc., is a Delaware corporation, incorporated in August 1995. Unless the context otherwise requires, references herein to "we," "our" or "Cash Tech" refers to Cash Technologies, Inc., and its wholly-owned and majority-owned subsidiaries National Cash Processors, Inc., a Delaware corporation; CoinBank Automated Systems, Inc., a Delaware corporation; CoinBank Automation Handels GmbH, organized operating in Salzburg, Austria, Cash Tech Card Systems, Inc., a Delaware corporation, CT Holdings, LLC., a Delaware limited liability company of which we own 86.65%, CPI Holdings, LLC dba Champion Parts, an Arkansas limited liability company, Veredi, Inc. (formerly Claim-Remedi Services, Inc., a Delaware company and TAP Holdings, LLC (formerly dba Tomco Auto Products), a California limited liability company. Our address is 1434 West 11th Street, Los Angeles, California 90015. Our telephone number is (213) 745-2000.

Our independent certified public accountant included an explanatory paragraph in its report for the year ended May 31, 2008, which indicated a substantial doubt as to the ability of us to continue as a going concern. This concern is primarily due to substantial debt service requirements and working capital needs. See independent certified public accountant's letter.

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The research and development of new software products and enhancements to existing software products were expensed as incurred (and recorded in the consolidated statement of operation) until technological feasibility has been established. Technological feasibility is established upon completion of a detailed program design or working model. Amortization of the capitalized software commenced on January 1, 2002. As of May 31, 2007, capitalized software costs had been fully amortized . Technological feasibility was achieved in September of 1999 and commencing October 1, 1999 all expenses related to EMMA software development had been capitalized. As of December 31, 2001, we had capitalized $2,771,536 in development and related costs. The EMMA product was available for release to the public in January 2002 thus all development costs since have been expensed including $25,000 for the fiscal year ended May 31, 2008 and $93,750 for the fiscal year ended May 31, 2007 .

Much of our SG&A costs are fixed in nature, therefore, as revenues increase, our SG&A does not increase proportionately.

We record as revenue licensing and software fees as well as coin counting machine sales in accordance with generally accepted accounting principles.

We are currently engaged principally in the auto products business.

RESULTS OF OPERATIONS

THREE MONTHS ENDED NOVEMBER 30, 2008 COMPARED TO THE THREE MONTHS ENDED NOVEMBER 30, 2007.

Net revenues for the three-month period ended November 30, 2008 increased to $453,840 compared to $35,348 for the same 2007 period. The increase in net revenue is attributable primarily to the acquisition of the Champion assets and the corresponding start of operations of CPI Holdings.

Cost of revenues for the three-month period ended November 30, 2008 was $355,448 compared to $22,669 for the same 2007 period. The increase in cost of revenues is directly related to the increase in sales from the start of our CPI Holdings subsidiary.

Gross profit (loss) for the three months ended November 30, 2008 was $98,392 compared to a Gross profit of $12,679 for the same period a year ago.

Selling, General and Administrative expenses for the three months ended November 30, 2008, decreased to $572,605 compared to $753,919 for the same three months ended November 30, 2007. These expenses consist primarily of wages (and wage related costs), outside contractor expenses, travel/promotional expenses, professional services and facilities/office related expenses.

Research and development expenses for the three months ended November 30, 2008 were $0 and for 2007, were $18,750.

Depreciation and amortization expenses for the three months ended November 30, 2008, and November 30, 2007, were $120,650 and $406, respectively.

Interest expense for the three months ended November 30, 2008 and November 30, 2007, was $44,757 and $179,331.

Minority Interest for the three months ended November 30, 2008 and November 30, 2007, was $0 and $(6,291), respectively.

As a result of the foregoing, net income (losses) for the three months ended November 30, 2008 and November 30, 2007, were $(839,620) and $(853,856), respectively.

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SIX MONTHS ENDED NOVEMBER 30, 2008 COMPARED TO THE SIX MONTHS ENDED NOVEMBER 30, 2007.

Net revenues for the six-month period ended November 30, 2008 increased to $675,429 compared to $78,935 for the same 2007 period. The increase in net revenue is attributable primarily to the acquisition of the Champion assets and the corresponding start of operations of CPI Holdings.

Cost of revenues for the six-month period ended November 30, 2008 was $758,418 compared to $48,243 for the same 2007 period. The increase in cost of revenues is directly related to the increase in sales from the start of our CPI Holdings subsidiary.

Gross profit (loss) for the six months ended November 30, 2008 was $(82,989) compared to a Gross profit of $30,692 for the same period a year ago.

Selling, General and Administrative expenses for the six months ended November 30, 2008, decreased to $1,035,552 compared to $1,500,703 for the same six months ended November 30, 2007. These expenses consist primarily of wages (and wage related costs), outside contractor expenses, travel/promotional expenses, professional services and facilities/office related expenses.

Research and development expenses for the six months ended November 30, 2008 were $0 and for 2007, were $37,500.

Depreciation and amortization expenses for the six months ended November 30, 2008, and November 30, 2007, were $390,145 and $1,160, respectively. The increase is due to the amortization of deemed interest expense.

Interest expense for the six months ended November 30, 2008 and November 30, 2007, was $169,961 and $252,752.

Minority Interest for the six months ended November 30, 2008 and November 30, 2007, was $(6,549) and $(12,840), respectively.

As a result of the foregoing, net (losses) for the six months ended November 30, 2008 and November 30, 2007, were $(1,872,098) and $(3,669,003), respectively.

LIQUIDITY AND CAPITAL RESOURCES

Our capital requirements have been and will continue to be significant, and our cash requirements have exceeded cash flow from operations. At November 30, 2008, we had a working capital of $4,929,362 compared to working capital of $5,241,369 at May 31, 2008. At November 30, 2008, we had a cash balance of approximately $177,492. We are in immediate need of working capital to continue our business and operations. To date, we have been funding our operations primarily through the issuance of equity in private placement transactions with existing stockholders or affiliates of stockholders. There can be no assurance that we will be able to continue to raise required working capital in this or any other manner.

Since inception, we have satisfied our working capital requirements through limited revenues generated from operations, the issuance of equity and debt securities, borrowing under a line of credit and loans from our security holders. Our independent certified public accountant included an explanatory paragraph in its report for the year ended May 31, 2008, which indicated a substantial doubt as to our ability to continue as a going concern. This concern is primarily due to substantial debt service requirements and working capital needs.

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Net cash provided by operating activities was $98,049 for the six-months ended November 30, 2008 compared to net cash (used in) of $(1,594,481) for the six-months ended November 30, 2007.

Net cash provided by (used in) investing activities for the six-months ended November 30, 2008, was $0 as compared to $496,514 for the six-months ended November 30, 2007. The increase was attributable to the sale of investment.

Net cash provided by (used in) financing activities for the six-months ended November 30, 2008, was $(330,862) as compared to $268,210 for the six-months ended November 30, 2007. The decrease was attributable to the net result of repayment of debt offset by various fund raising activities.

In 1997, we entered into a credit agreement with G.E. Capital Corporation, or G.E. Capital, pursuant to which we borrowed $ 5,500,000 for the purchase of CoinBank component equipment, working capital and general corporate purposes. Due to our inability to repay G.E. Capital on the original terms, on September 29, 2000 we entered into the first of several loan modifications with G.E. The most recent modification requires a payment of certain fees and interest following which GE has agreed to extend the loan on interest-only terms at a rate of 9.5% for 12 additional months at which time the entire unpaid balance shall be due and payable. We have no current plan or capability to repay G.E. its principal. A default of this obligation could result in the delisting and/or bankruptcy of the Company. As of November 30, 2008, we owed G.E. Capital approximately $4 million which includes the principal, financing fees and unpaid interest.

In May 2003 we completed a private placement offering with one of our stockholders consisting of convertible notes and warrants under Section 4(2) of the Securities Act of 1933. The offering consisted of an unsecured convertible promissory note in the principal amount of $50,000, bearing interest at the rate of 5% per annum and redeemable warrants to purchase 100,000 shares of common stock. The note is convertible into our common stock at the conversion rate of $0.50 per share. The Warrants are exercisable at a price of $1.00 per share. We also reduced the exercise price of 8,000 Series C warrants owned by the stockholder from $2.50 to $0.25 per share. The note was due and payable on May 2, 2008 and remains unpaid. A deemed dividend expense of $25,331 was recognized in conjunction with the warrants offered in this placement.

In May 2003 we completed a private placement offering with one of our stockholders consisting of convertible notes and warrants under Section 4(2) of the Securities Act of 1933. The offering consisted of an unsecured convertible promissory note in the principal amount of $20,750, bearing interest at the rate of 5% per annum and redeemable warrants to purchase 30,000 shares of common stock. The note is convertible into our common stock at the conversion rate of $0.50 per share. The Warrants are exercisable at a price of $0.65 per share. We also reduced the exercise price of 45,000 Series B warrants owned by the stockholder from $4.50 to $0.65 per share which were converted immediately for gross proceeds to us of $29,250. The note was due and payable on May 8, 2008 and remains unpaid. A deemed dividend expense of $25,901 was recognized in conjunction with the warrants offered in this placement.

In November 2004, TAP Holdings, LLC established a line of credit with BFI Business Finance. The maximum amount available under the line of credit is $2,000,000, limited to 60% of eligible accounts receivable plus 60% of eligible inventory up to $1,000,000, less any availability reserves, as defined in the loan agreement. Interest is payable monthly at 4.0% per annum above the prime interest rate (10% at May 31, 2005). The line of credit is collateralized by a security interest in TAP's accounts receivable, inventories, property and equipment and certain other assets as well as a limited personal guaranty from TAP's chairman (who is not an employee of Cash Technologies). TAP must also adhere to covenant limitations, conditions and restrictions as set forth in the loan and security agreement. As of November 30, 2008, there was $205,703 outstanding including interest.

The outstanding balance is expected to be paid from the sale of certain assets of TAP and refunded insurance deposits.

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RISK FACTORS

The following factors, in addition to those discussed elsewhere, should be considered carefully in evaluating our business and us. An investment in our shares involves a high degree of risk and is suitable only for those investors who can bear the risk of loss of their entire investment.

Risks Related to Our Financial Condition

We have limited revenues and a history of incurring losses, which has resulted in our independent accountants issuing opinions containing doubts about our ability to continue as a going concern.

We have generated limited revenues since our inception, and, while we expect to generate significant revenues within the next fiscal year, there is no assurance that we will be successful. For the fiscal years ended May 31, 2008 and 2007, we had net sales of $336,615 and $313,946, respectively. Virtually all of our revenues for the fiscal year beginning June 1, 2008 until the quarter ending November 30, 2006 were derived from our CPI Holdings subsidiaryVeredi.

Prior to the fiscal year ended May 31, 2008 we have incurred losses since our inception. For the last two fiscal years ended May 31, 2007 and 2008, net income (losses) of ($3,065,247) and $(800,052) respectively. In its reports accompanying our audited financial statements for the fiscal years ended May 31, 2007 and 2008, our independent auditors included an explanatory paragraph wherein they expressed substantial doubt about our ability to continue as a going concern. For the six-month period ended November 30, 2008 we have incurred additional losses of $(1,872,098)

We are unable to pay our current liabilities, and must rely on the continued forbearance of specific creditors to avoid bankruptcy.

As of November 30, 2008 we had outstanding current liabilities of $9,791,691, consisting of obligations and accruals for loans, dividends and notes payable, trade payables, taxes, unpaid salaries and other items of which approximately $1,820,000 is not being paid as agreed. Our creditors have, to date, agreed not to accelerate on these obligations and not to foreclose on our assets. However, should the creditors demand immediate repayment, we would have to raise the needed funds to satisfy the obligations, possibly on unsatisfactory terms or failing that, we would have to consider ceasing operations and/or filing for bankruptcy protection.

We have an immediate need for capital and if we are unable to obtain the financing we need, our business may fail.

As of November 30, 2008, Cash Tech had working capital of $$4,929,362 and available cash of $177,492. Our capital requirements have been and will continue to be significant, and our cash requirements have exceeded cash flow from operations since inception. We are in immediate need of capital to continue to operate. We have been dependent on the proceeds of private placements of our debt and equity securities to satisfy our working capital requirements. We will be dependent upon the proceeds of future private placement offerings or other public offerings to fund our short-term working capital requirements, to fund certain marketing activities and to continue implementing our business strategy. There can be no assurance we will be able to raise necessary capital. To the extent that we incur indebtedness or issue debt securities, we will be subject to all of the risks associated with incurring indebtedness, including the risks that interest rates may fluctuate and cash flow may be insufficient to pay principal and interest on any such indebtedness. Any inability to obtain additional financing when needed could require us to significantly curtail, or possibly cease altogether, our operations. There can be no assurance that our lenders will not declare an event of default and demand immediate payment or seek to attach our assets. As of November 30, 2008, we also owe approximately $4 million to General Electric Capital Corporation. In 2000, we entered into the first of several loan renewals with G.E., the most recent of which shall expire on February 1, 2010 at which time all sums owing to GE are due and payable. A default of this obligation or failure to negotiate a renewal could result in the delisting and/or bankruptcy of the Company.

Our assets serve as collateral for various loan obligations and therefore may not be available for distribution to stockholders in the event of liquidation.

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We have previously granted security interests in all of our assets to several lenders, including the holder of notes in the principal and interest amount of $178,520 issued in a placement which was completed in January 2000, General Electric Capital Corporation pursuant to a Master Security Agreement originally entered into in May 1997 and liens in favor of BFI Finance on all assets of TAP Holdings pursuant to a Loan and Security Agreement entered into in November, 2004.

As of November 30, 2008, we were indebted to G.E. in the amount of approximately $4 million including interest. As a result of the aforementioned security interests, creditors would be entitled to collect upon the assets prior to any distribution being available to holders of our Common Stock or Preferred Stock.

The BFI loan is a revolving accounts receivable credit facility secured by all of the business assets of TAP Holdings, LLC as well as a limited personal guaranty from TAP's former chairman (who is not an employee of Cash Technologies). As of November 30, 2008 we owed BFI approximately $205,703 including interest. The outstanding balance owed to BFI is expected to be paid from the sale of certain assets of TAP and refunded insurance deposits.

Any additional financing that we may obtain may substantially dilute the interests of our stockholders

To the extent that we obtain additional financing through the issuance of additional equity securities in the future, such issuance may involve substantial dilution to our then-existing stockholders.

Risks Related to CPI Holdings, LLC

CPI is expected to be substantially dependent on its major customers; initially Autozone, Pep Boys, and CARQUEST, Mercury Marine and ATG. These customers have accounted thus far for approximately 77% of CPI's revenue. The loss of any of these customers would have a material adverse affect on CPI's revenue.

The market for fuel system products is shrinking.

Until and unless CPI begins sales of turbocharger and/or other products under consideration, all or virtually all of CPI’s revenue will be from the sale of rebuilt carburetors and air conditioning compressors. Sales of carburetors have fluctuated and may continue to fluctuate or decline as the number of vehicles using carburetors continues to decline. CPI expects to compensate for this decline by increasing its market share and from routine price increases but there is no assurance that it can succeed in this effort.

CPI may not fully recover the carrying value of its inventory.

As of November 30, 2008, CPI had a carrying value of $13,234,311 for its inventory. In May 2008, at the time CPI's assets were purchased, an obsolescence reserve of $1,113,200 was established to cover potential inventory impairment. In future periods, additional reserves may be taken based on CPI’s inventory, which could result in a substantial expense and negatively impact CPI’s financial results.

The turbocharger market is competitive and sales are uncertain

Following the acquisition of the Turbomotive assets (see above), CPI intends to manufacture and distribute turbochargers though its retail and other channels. While CPI’s retailers have indicated their interest in carrying the company’s turbo products, there can be no assurance that the retail channel will be timely activated or produce sufficient revenues to meet CPI’s objectives. In addition, other larger manufacturers of turbos, such as Honeywell and Borg-Warner, are better capitalized and better known than CPI and could negatively impact CPI’s sales if they targeted the same markets.

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Turbocharger manufacturing may be delayed

Following the acquisition of the Turbomotive assets, CPI will begin to establish manufacturing operations to produce turbochargers at its factory in Hope, Arkansas. While CPI’s management has manufactured turbos in the past and believes that it possesses the necessary expertise to do so in the future, various manufacturing start-up problems, including engineering, supply chain, quality control or other issues, or insufficient capital to purchase needed tooling or equipment, can delay or impede the start or continuation of turbo production and materially impact turbocharger sales.

Risks Related to TAP Holdings, LLC

TAP’s revenues have ceased

Risks Related to Our Healthcare Products

Competition in healthcare software is intense.

Veredi Inc.’s (formerly Claim-Remedi Services, Inc.) healthcare products compete with products offered by companies that are larger, better known and better capitalized than Veredi. Veredi has taken steps and developed features designed to differentiate its products, however these steps may prove inadequate in which event Veredi might have to withdraw one or more of its products which would have a material adverse effect on Cash Technologies.

Veredi is liable for the loss or misuse of personal information.

Veredi and its affiliates have custody of, or come into contact with, various types of personal information about consumers, their medical records and financial transactions. The company has taken steps to safeguard such information and requires that its suppliers safeguard such information, however, in the event such safeguards fail to prevent the loss or misuse of personal information, the company might be liable for any damages caused thereby.

Veredi is substantially dependent on third parties for data processing and customer support.

Most data processing and customer support for Veredi’s products are performed by third parties under various exclusive and non-exclusive contracts. This reduces infrastructure development costs and increases speed to market, however the failure of a third party to perform its duties or renew a service agreement could be materially detrimental to the company's operations.

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Essential services related to CashTechCard have ceased.

In December, 2007 the Company’s CashTechCard Systems, Inc. subsidiary received notice that its card issuer, First Premier Bank, would be exiting the prepaid debit card industry and its card transaction processing would cease by April 10, 2008. CashTechCard began efforts to secure a replacement issuer on acceptable terms. However, as a result of the significant costs and requirements of replacement issuers and the limited resources available from the Company as it plans to acquire the Champion assets, on April 18, 2008 the board of CashTechCard decided not to continue card issuance and processing activities.

Data processing margins generally decline as products become more mature.

Data processing products usually become “commoditized” as they mature, with a corresponding reduction in profit margins. This is caused by a number of factors, including: Increased competition forcing lower prices; increased volumes creating economies of scale which permit lower prices by competitors, software development costs which are eventually fully amortized also permits lower prices, et al. There is no assurance that Veredi can generate enough growth in its sales to outpace these market forces.

Risks Related to Our CoinBank Machines

Impairment Charge

We are currently holding for sale approximately 190 CoinBank machines which were manufactured when the Company was actively engaged in the sale of such equipment. The machines have a carrying value of approximately $464,890 at November 30, 2008, 2008 and $609,890 at May 31, 2008. We have taken an impairment charge of $100,000 in the quarter ended August 31, 2008 for the carrying value of our CoinBank machines. The impairment was taken due to low inventory turnover for the coin machines. In October, 2008 we sold 10 CoinBank machines for $69,500. In future periods, while we intend to liquidate the remaining machines, additional impairment may be taken. If we conclude that such impairment exists, this could give rise to a substantial expense, which would increase our reported losses. We have identified parties interested in acquiring the remaining units, although there is no assurance that such sales will be consummated and we may not fully recover the carrying value of our CoinBank machines held for sale.

We may not successfully compete with our competitors.

The automotive and healthcare industries are fully developed markets served by large companies who are better able to finance, develop and market products than is the Company. We have attempted to differentiate our products from those of our competitors but competitive products aimed at our target markets could obviate the need for our products or severely limit our market penetration.

We are dependent on third-party manufacturers and on independent contractors, whose nonperformance could harm our business.

We are substantially dependent on the ability of the independent contractors we hire to provide software engineering and support for our products. Any contractor that we utilize or may utilize may not have sufficient capacity to satisfy our needs during any period of sustained demand. The loss of services of independent contractors could disrupt our business. Furthermore, certain of our products access networks which are owned and operated by third parties. The failure or unavailability of these networks could have a material adverse effect on us.

Risks Related to Government Regulation and Patent and Licensing matters

Uncertainty of patent and trademark protection.

Although we have been issued U.S. Patents with respect to our CoinBank and EMMA technologies, there can be no assurance that these patents will afford us any meaningful protection. We intend to rely primarily on a combination of trade secrets, technical measures, copyright protection and nondisclosure agreements with our employees to establish and protect the ideas, concepts and documentation of software developed by us. Such methods may not afford complete protection, and there can be no assurance that third parties will not independently develop such technology or obtain access to the software we have developed. Although we believe that our use of the software we developed and other software used in our operations does not infringe upon the rights of others, our use of the software we developed or such other software may infringe upon the patents or intellectual property rights of others. In the event of infringement, we could, under certain circumstances, be required to obtain a license or modify aspects of the software we developed or such other software or refrain from using such software. We may not have the necessary financial resources to defend any infringement claim made against us or be able to successfully terminate any infringement in a timely manner, upon acceptable terms and conditions or at all. Failure to do any of the foregoing could have a material adverse effect on us. Moreover, if the software we developed or any other software or hardware used in our business is deemed to infringe upon the rights of others, we could, under certain circumstances, become liable for damages, which could have a material adverse effect on us. We received United States trademark registration for the "CoinBank" name in September 1997. Although we are not aware of any claims of infringement or other challenges to our rights to use this trademark, there can be no assurance that our marks do not or will not infringe upon the proprietary rights of others or that our marks would be upheld if challenged.

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Risks Related to Our Management

The success of our business also requires that we retain other qualified management personnel.

Our success is also dependent upon our ability to hire and retain additional qualified management, marketing, technical, financial and other personnel. Competition for qualified personnel is intense, and there can be no assurance that we will be able to hire or retain additional qualified personnel. Any inability to attract and retain qualified management and other personnel would have a material adverse effect on us.

Our directors and officers have limited personal liability.

Our Certificate of Incorporation includes provisions to limit, to the full extent permitted by Delaware law, the personal liability of our directors for monetary damages arising from a breach of their fiduciary duties as directors. In addition, our By-Laws require us to indemnify any of our directors, officers, employees or agents to the full extent permitted by Delaware law. As a result of such provisions in our Certificate of Incorporation and the By-Laws, security holders may be unable to recover damages against our directors and officers for actions taken by them which constitute negligence, gross negligence or a violation of their fiduciary duties. This may reduce the likelihood of security holders instituting derivative litigation against directors and officers and may discourage or deter security holders from suing our directors, officers, employees and agents for breaches of their duty of care, even though such an action, if successful, might otherwise benefit us and our security holders.

Risks Related to our Common Stock

If our common stock is delisted from the American Stock Exchange, we also are likely to be subject to the risks relating to penny stocks.

Our common stock has not been traded above $5.00 in over seven years. If our common stock were to be delisted from trading on the American Stock Exchange and the trading price of the common stock remained below $5.00 per share, trading in our common stock would be subject to the requirements of certain rules promulgated under the Exchange Act related to so-called penny stocks. A penny stock is defined generally as any non-exchange listed equity security that has a market price of less than $5.00 per share, subject to certain exceptions. These rules require additional disclosure by broker-dealers in connection with any trades involving a stock defined as a penny stock and impose various sales practice requirements on broker-dealers who sell penny stocks to persons other than established customers and accredited investors, generally institutions. The additional burdens imposed upon broker-dealers by such requirements may discourage broker-dealers from effecting transactions in our common stock, which could severely limit the market price and liquidity of our common stock and the ability of purchasers to sell our common stock in the secondary market.

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If our common stock is delisted from the American Stock Exchange, we may not be able to raise essential investment capital.

If our common stock is delisted from the American Stock Exchange, particularly as a result of failing to accomplish our plan to regain compliance with the Amex listing standards (see below) we may find it difficult or impossible to raise additional investment capital, without which we cannot survive.

The price of our common stock has been, and may continue to be, volatile.

The market price of our common stock has fluctuated over a wide range, and it is likely that the price of our common stock will fluctuate in the future. The one year sale price for our common stock, as reported by the American Stock Exchange has fluctuated from a low of $0.10 to a high of $1.05 per share. The market price of our common stock could be impacted by a variety of factors, including:

announcements of technological innovations or new commercial products by us or our competitors.

changes in government regulation and policies which may be undertaken with respect to security issues related to terrorism, privacy and other matters.

developments in the patents or other proprietary rights owned or licensed by us or our competitors.

matters related to our financial condition, including our ability to obtain necessary capital.

litigation affecting us or our products.

general market conditions in our industry.

In addition, the stock market continues to experience price and volume fluctuations. These fluctuations have especially affected the market price of many technology companies. Such fluctuations have often been unrelated to the operating performance of these companies. Nonetheless, these broad market fluctuations may negatively affect the market price of our common stock.

We have the discretion to issue additional shares of preferred stock with rights and preferences superior to those granted to holders of our common stock.

Our Certificate of Incorporation authorizes our board of directors to issue up to 1,500,000 shares of preferred stock, from time to time, in one or more series. Our board of directors is authorized, without further approval of the security holders, to fix the dividend rights and terms, conversion rights, voting rights, redemption rights and terms, liquidation preferences, and any other rights, preferences, privileges and restrictions applicable to each new series of preferred stock. The issuance of such stock could adversely affect the voting power of the holders of common stock and, under certain circumstances, make it more difficult for a third party to gain control of us, discourage bids for our common stock at a premium, or otherwise adversely affect the market price of our common stock.

Risks Related to our listing on the American Stock Exchange

In November 2007, as a result failing to meet the minimum continued listing standards of the AMEX, including the reduction in our stockholders equity below $6,000,000, which was caused by various factors including the write-off of the Champion note (see Note Receivables), we were notified by AMEX that we were subject to delisting in accordance with AMEX rules. We submitted, and Amex approved, our plan to regain compliance with the listing standards and have since reported that we believe we are now in compliance with such listing standards, including the re-establishment of stockholders equity in excess of the $6,000,000 threshold, however AMEX is evaluating our compliance report and has not yet provided its approval. If for any reason AMEX deems that we are not in compliance with the continued listing standards it is likely that AMEX will move to delist our stock.

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ITEM 4. CONTROLS AND PROCEDURES

The Company maintains disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e)) that are designed to assure that information required to be disclosed in its Securities Exchange Act of 1934 reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures.

In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide reasonable assurance only of achieving the desired control objectives, and management necessarily is required to apply its judgment in weighting the costs and benefits of possible new or different controls and procedures. Limitations are inherent in all control systems, so no evaluation of controls can provide absolute assurance that all control issues and any fraud within the Company have been detected.

As required by Exchange Act Rule 13a-15(b), as of the end of the period covered by this report the Company, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the Company’s disclosure controls and procedures. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of that date.

There was no change in the Company’s internal control over financial reporting during the Company’s most recently completed fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

On August 22, 2008, TAP Holdings, LLC, a wholly owned subsidiary of Cash Technologies, Inc. filed a lawsuit against PNC Bank National Association, PNC Business Credit, John Stanescki, Lee Labine, Tom Stoltz and Does 1-10 (“Defendants”), in California Superior Court (TAP Holdings, LLC vs. PNC Bank, National Association et al, Case No. BC396800) alleging that Defendants and each of them:

(i) Fraudulently induced TAP to enter into a Subordination and Standstill Agreement as part of TAP’s sale of most of its assets to Champion Parts, Inc. (“Champion”) in 2006;

(ii) Conspired to defraud TAP of payments to which it was entitled from Champion through the use of the mail and wire in violation of the Racketeering Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. §1962;

(iii) Exercised dominion and control over Champion and its management, ultimately resulting in the bankruptcy of Champion and the evisceration of the Promissory Note owed by Champion to TAP with a remaining balance of approximately $8.5 million;

(iv) Breached the covenant of good faith and fair dealing in the agreements they signed in the sale of the TAP assets to Champion;

(v) Breached their fiduciary duty to TAP in their handling of the loan(s) to Champion; and

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(vi) Negligently misrepresented and/or omitted material facts to TAP involving Champion, the agreement and sale of the TAP assets to Champion, and the ability of Champion to repay the Promissory Note owed to TAP.

In subsequent court proceedings, the case was transferred to federal court, following which TAP dismissed and re-filed the case, omitting the allegations described in item (ii). Defendants have filed a cross-complaint alleging that TAP owes them $600,000 for payments allegedly improperly paid by Champion Parts, Inc. to TAP. The company will incur significant costs to pursue this litigation and there can be no assurance that it will prevail.

On April 14, 2008, Del Rey Ventures, Inc. filed a lawsuit in California against TAP Holdings, LLC, for breach of contract and common counts in the amount of $77,663, plus interest, costs and attorney’s fees. The lawsuit also named Cash Technologies, Inc. and TAP Holdings boardmembers Edmund King and Bruce Korman as alter egos of TAP Holdings. TAP Holdings and the other defendants filed cross-complaints against Del Rey Ventures and Richard Schoenfeld seeking no less than $3 million in compensatory damages, as well as punitive damages, rescission, interest and costs for the wrongful conduct of the cross-defendants, including:

Multiple acts of fraud, including material misrepresentations and/or omissions in connection with TAP’s sale of assets to Champion in October 1996 and the fraudulent inducement of an assignment of an employment contract from Mr. Schoenfeld to Del Rey Ventures;

ii.

Breach of fiduciary duty, including the defendants’ concealment of unanticipated returns before the 1996 TAP sale of assets to Champion resulting in a shortfall at closing;

iii.

Corporate waste, including Mr. Schoenfeld’s misreporting of TAP’s inventory between June 2006 and October 2006;

iv.

Conversion and the taking of corporate opportunity in the secret and unauthorized sale of approximately 11,000 finished goods from TAP’s inventory for Mr. Schoenfeld’s personal gain to the detriment of TAP and its shareholders; and

Breach of contract for the defendants’ failure to provide the services required under the assigned employment contract.

TAP Holdings and Cash Tech will incur significant costs to pursue this litigation and there can be no assurance that they will prevail.

In 2001 we delivered stock certificates representing 700,000 shares to an escrow agent as collateral for a loan. The loan was never consummated, and in May 2001 we notified the transfer agent to cancel the shares. Thereafter the escrow agent, an attorney, died and we were never able to recover the certificates. In August, 2004 it came to our attention that a party was attempting to transfer 450,000 of the 700,000 shares. We immediately initiated a lawsuit in New York to prevent the transfer of the shares and have them retired. In December, 2004, we reached a settlement in which the shares would be returned to us without any exchange of money. We intend to similarly pursue the recovery of the remaining 250,000 shares, however in the event that we cannot achieve a satisfactory outcome in such effort, or in the event that the pending settlement is not consummated for any reason, some or all of these shares may be treated as outstanding and our Stockholders' Equity line item would have to be adjusted to reflect such additional shares.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None

ITEM 3. DEFAULT UPON SENIOR SECUR IT IES

None

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None

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ITEM 5. OTHER INFORMATION

None

ITEM 6. EXHIB IT S AND REPORTS ON FORM 8-K

(a)		Exhibits

31.1		Certification of Chief Executive Officer

31.2		Certification of Chief Financial Officer

32.1		Certification Pursuant to Section 906 of the Sarbanes-Oxley Act

(b)		Report on Form 8-K filed on March 15, 2007 under Item 7.01.
		Report on Form 8-K filed on June 6, 2007 under Item 1.01 and 3.02.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Report on Form 10-Q for the fiscal quarter ended November 30, 2008, to be signed on its behalf by the undersigned, thereunto duly authorized the 20th day of January 2009.

CASH TECHNOLOGIES, INC.


By: /S/ Bruce Korman
Bruce Korman
President and Chief Executive Officer


By: /S/ Edmund King
Edmund King
Chief Financial Officer

CASH TECHNOLOGIES INC 10-Q/A