UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

[X]	Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
	For the quarterly period ended June 30, 2009
[ ]	Transition Report pursuant to 13 or 15(d) of the Securities Exchange Act of 1934
	For the transition period __________ to __________
	Commission File Number: 333-140438

x Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended September 30, 2009

o Transition Report pursuant to 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period __________ to __________

Commission File Number: 333-140438

Blue Earth Solutions, Inc.

(Exact name of small business issuer as specified in its charter)

Nevada	26-1909139
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)

13511 Granville Ave., Clermont, Florida, 34711

(Address of principal executive offices)

352-729-0150

(Issuer’s telephone number)

_______________________________________________________________

(Former name, former address and former fiscal year, if changed since last report)

Check whether the issuer (1) 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 issuer was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days x ~~[X]~~ Yes o ~~[ ]~~ 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). o ~~[ ]~~ Yes o ~~[ ]~~ 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.

[o ] Large accelerated filer Accelerated filer [o ] Non-accelerated filer ~~[X]~~x Smaller reporting company [o ] Accelerated filer

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ~~[ ]~~ o Yes ~~[X]~~x No

State the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 33,032,602 common shares as of ~~September 21~~December 5, 2009.

Table of Contents

	TABLE OF CONTENTS	Page
PART I – FINANCIAL INFORMATION
Item 1:	Financial Statements	3
Item 2:	Management’s Discussion and Analysis of Financial Condition and Results of Operations	4
Item 4T:	Controls and Procedures	9
PART II – OTHER INFORMATION
Item 1:	Legal Proceedings	10
Item 2:	Unregistered Sales of Equity Securities and Use of Proceeds	11
Item 3:	Defaults Upon Senior Securities	11
Item 4:	Submission of Matters to a Vote of Security Holders	11
Item 5:	Other Information	12
Item 6:	Exhibits	12

TABLE OF CONTENTS

		Page
PART I – FINANCIAL INFORMATION
Item 1:	Financial Statements	3
Item 2:	Management’s Discussion and Analysis of Financial Condition and Results of Operations	4
Item 4T:	Controls and Procedures	7
PART II – OTHER INFORMATION
Item 1:	Legal Proceedings	8
Item 2:	Unregistered Sales of Equity Securities and Use of Proceeds	8
Item 3:	Defaults Upon Senior Securities	9
Item 4:	Submission of Matters to a Vote of Security Holders	9
Item 5:	Other Information	9
Item 6:	Exhibits	9

Table of Contents

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

Our unaudited financial statements included in this Form 10-Q are as follows:
F-1	Balance Sheets as of ~~June~~September 30, 2009, ~~(Unaudited)~~2008 and March 31, 2009 (Unaudited);
F-2	Statements of Operations (unaudited) for the six and three months ended ~~June~~September 30, 2009 and 2008~~, and the period from February 5, 2008 (Inception) to June 30, 2009;~~
F-3	Statements of Cash Flows (unaudited) for the ~~three~~six months ended ~~June~~September 30, 2009 and 2008~~, and the period from February 5, 2008 (Inception) to June 30, 2009;~~
F-5	Notes to Unaudited Financial Statements

These unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and the SEC instructions to Form 10-Q. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. Operating results for the interim period ended ~~June~~September 30, 2009 are not necessarily indicative of the results that can be expected for the full year.

Table of Contents

BLUE EARTH SOLUTIONS, INC.

(A Development Stage Company)

Balance Sheets

	June 30, 2009			March 31, 2009
ASSETS
	(unaudited)
		September 30,							March 31,
ASSETS
		2009				2008			2009
CURRENT ASSETS
		(unaudited)				(unaudited)			(unaudited)
Cash and cash equivalents	$	-		$	50,695
CURRENT ASSETS
Accounts receivable		19,333			10,907
Cash and cash equivalents		$	340,457			$	2,637,702		$	50,695
Prepaid expenses		28,401			41,421
Accounts receivable 2009 net of $17,000 allowance			912,213				1,503			10,907
Inventory (Note 4)		252,250			231,153
Prepaid expenses			19,211				103,967			41,421
Total Current Assets		299,984			334,176
Inventory			273,886				62,917			231,153
PROPERTY AND EQUIPMENT, net		6,840,724			6,910,347
Investments			144,204				-			-
OTHER ASSETS
Total Current Assets			1,689,971				2,806,089			334,176
Depository funds (Note 5)		8,273,991			8,206,990
PROPERTY AND EQUIPMENT, net			5,268,808				2,460,916			4,098,283
Deposits		41,615			65,555
OTHER ASSETS
Total Other Assets		8,315,606			8,270,545
Investments			1,447,269				-			-
TOTAL ASSETS	$	15,456,314		$	15,517,068
Depository funds			8,234,332				8,538,958			8,206,990
LIABILITIES AND STOCKHOLDERS' EQUITY
Goodwill			339,514				-			-
CURRENT LIABILITIES
Deposits & deposits on equipment			2,828,680				2,813,619			2,877,619
Accounts payable and accrued expenses	$	2,107,131		$	1,551,653
TOTAL ASSETS		$	19,808,574			$	16,619,582		$	15,517,068
Bank overdraft		21,900			-
LIABILITIES AND STOCKHOLDERS' EQUITY
Notes payable - related parties (Note 6)		553,119			462,500
CURRENT LIABILITIES
Total Current Liabilities		2,682,150			2,014,153
Accounts payable and accrued expenses		$	2,761,457			$	1,344,797		$	1,399,145
LONG-TERM LIABILITIES
Accounts payable and accrued expenses - Related Parties			627,653				6,897			152,508
Notes payable (Note 7)		1,049,000			1,049,000
Notes payable			35,729				-			-
Total Liabilities		3,731,150			3,063,153
Notes payable - related parties			5,382,171				20,000			462,500
STOCKHOLDERS' EQUITY
Total Current Liabilities			8,807,009				1,371,694			2,014,153
Preferred stock, Series A, $0.001 par value, 10,000,000 shares authorized, -0- shares issued and outstanding		-			-
LONG-TERM LIABILITIES
Preferred stock, Series B, $0.001 par value, 5,000,000 shares authorized, -0- shares issued and outstanding		-			-
Notes payable			1,238,199				1,049,000			1,049,000
Preferred stock, Series C, $0.001 par value, 5,000,000 shares authorized, 14,130 shares issued and outstanding (Note 5)		14			14
Total Liabilities			10,045,208				2,420,694			3,063,153
Common stock, $0.001 par value, 100,000,000 shares authorized, 31,632,602 and 32,025,300 shares issued and outstanding, respectively		31,632			32,025
STOCKHOLDERS' EQUITY
Additional paid-in capital		14,835,665			15,052,300
Preferred stock, Series A, $0.001 par value, 10,000,000
Deficit accumulated during the development stage		(3,142,147)			(2,630,424)
shares authorized, -0- shares issued and outstanding			-				400			-
Total Stockholders' Equity		11,725,164			12,453,915
Preferred stock, Series B, $0.001 par value, 5,000,000
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	15,456,314		$	15,517,068
shares authorized, -0- shares issued and outstanding
Preferred stock, Series C, $0.001 par value, 5,000,000
shares authorized, 14,130 shares
issued and outstanding			14				14			14
Common stock, $0.001 par value, 100,000,000 shares
authorized, 33,532,602 and 32,025,300 shares
issued and outstanding, respectively			33,082				26,013			32,025
Unrealized (Loss) on Available For Sales Securities			(1,308,527	)			-			-
Additional paid-in capital			15,275,865				14,739,807			15,052,300
Accumulated deficit			(4,237,067	)			(567,346	)		(2,630,424	)
Total Stockholders' Equity			9,763,366				14,198,888			12,453,915
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		$	19,808,574			$	16,619,582		$	15,517,068
			-				-			-

The accompanying notes are an integral part of these ~~unaudited~~ financial statements.

F-1

Table of Contents

BLUE EARTH SOLUTIONS, INC.

(A Development Stage Company)

Statements of Operations

(unaudited)

	For the Three Months Ended June 30, 2009			For the Three Months Ended June 30, 2008			From Inception on February 15, 2008 Through June 30, 2009
	For the Three Months Ended								For the Six Months Ended
REVENUES	$	23,900		$	10,234		$	55,767
	September, 30								September, 30
COST OF SALES		91,193			1,343			156,184
		2009				2008			2009			2008
Gross Profit (Loss)		(67,293)			8,891			(100,417)
REVENUES		$	1,997,095			$	4,282		$	2,020,995		$	14,516
OPERATING EXPENSES
COST OF SALES			1,737,576				2,592			1,828,769			3,935
General and administrative		476,532			159,215			3,246,599
Gross Profit			259,519				1,690			192,226			10,581
Total Operating Expenses		476,532			159,215			3,246,599
OPERATING EXPENSES
LOSS FROM OPERATIONS		(543,825)			(150,324)			(3,347,016)
Depreciation expense			7,899				13,750			8,348			32,083
OTHER INCOME (EXPENSES)
General and administrative			1,046,606				435,014			1,522,689			575,896
Interest income		67,354			-			292,207
Total Operating Expenses			1,054,505				448,764			1,531,037			607,979
Loss on sale of equipment		(5,142)			-			(5,142)
LOSS FROM OPERATIONS			(794,986	)			(447,074	)		(1,338,811	)		(597,398	)
Interest expense		(30,110)			-			(82,196)
OTHER INCOME (EXPENSES)
Total Other Income (Expenses)		32,102			-			204,869
Interest income			23,894				50,075			91,248			50,075
NET LOSS BEFORE INCOME TAXES		(511,723)			(150,324)			(3,142,147)
Loss on sales of assets			(132,815	)			-			(137,957	)		-
Income taxes		-			-			-
Interest (expense) Related Party			(151,500	)			(3,000	)		(161,404	)		(3,000	)
NET LOSS	$	(511,723)		$	(150,324)		$	(3,142,147)
Interest (expense)			(19,696	)			(12,440	)		(39,902	)		(12,440	)
BASIC LOSS PER COMMON SHARE	$	(0.02)		$	(0.01)
Total Other Income (Expenses)			(280,116	)			34,635			(248,014	)		34,635
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING		31,828,952			24,559,300
NET (LOSS) BEFORE INCOME TAXES			(1,075,102	)			(412,439	)		(1,586,825	)		(562,763	)
Income taxes			-				-			19,817			-
NET (LOSS)		$	(1,075,102	)		$	(412,439	)	$	(1,606,642	)	$	(562,763	)
BASIC AND DILUTED (LOSS) PER COMMON SHARE			(0.03	)		$	(0.02	)	$	(0.05	)	$	(0.03	)
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING			31,850,986				25,286,300			32,091,252			19,190,867

The accompanying notes are an integral part of these ~~unaudited~~ financial statements

F-2

Table of Contents

BLUE EARTH SOLUTIONS, INC.

(AStatements ~~Development~~of ~~Stage~~Cash ~~Company)~~Flows

~~Statements of Cash Flows~~ (unaudited)

	For the Three Months Ended June 30, 2009			For the Three Months Ended June 30, 2008			From Inception on February 5, 2008 Through June 30, 2009
		For the Six Months Ended
		September 30,
		2009				2008
OPERATING ACTIVITIES
Net loss	$	~~(511,723)~~$	(1,606,642	$)	~~(150,324)~~	$	$(562,763	~~(3,142,147~~)
Adjustments to Reconcile Net Loss to Net
Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities
Write off of discontinued inventory			176,325				-
Cash Used in Operating Activities:
Depreciation expense		~~67,730~~	215,204		~~18,333~~		32,083	~~145,223~~
Shares issued for services		~~65,572~~	(14,736	)	-		30,650	~~146,322~~
Loss on sale of equipment		5,142			-			5,142
Loss on sale of assets
Fair value of warrants granted		-			-			985,936
Unrealized (Loss) on Available For Sale Securities			(1,308,527	)			-
Changes in operating assets and liabilities:
(Increase) decrease in prepaid expenses and deposits		36,960			(72,941)			(70,016)
(Increase) decrease in prepaid expenses			22,210				(105,522	)
(Increase) in accounts receivable		(8,426)			(1,010)			(19,333)
(Increase) decrease in accounts receivable			(2,034,306	)			(1,503	)
(Increase) in inventory		(21,097)			(4,091)			(252,250)
(Increase) decrease in depository accounts			(27,342	)			(8,538,958	)
Increase in accounts payable and accrued expenses		272,878			12,321			907,034
(Increase) decrease in inventory			(411,058	)			(62,917	)
Net Cash Used in Operating Activities		(92,964)			(197,712)			(1,294,089)
(Increase) decrease in deposits			48,939				-
Increase (decrease) in accounts payable
and accrued expenses			2,631,462				1,152,128
Net Cash Used in Operating Activities			(2,308,471	)			(8,056,802	)
INVESTING ACTIVITIES
Increase in depository funds		(67,001)			-			(8,273,991)
Sale of Equipment			261,145				-
Sale of equipment		23,500			-			23,500
Purchase of property and equipment, net			(3,341,874	)			(3,710,646	)
Purchase of property and equipment		(26,749)			(115,320)			(5,765,589)
Investments in avaiable for sale securities			(144,204	)			-
Net Cash Used in Investing Activities		(70,250)			(115,320)			(14,016,080)
Accrued Dividends			(565,200	)			-
Acquisition of American Marketing			6,719,060				-
Investment in securities			(1,200,000	)			-
Net Cash Provided by Investing Activities			1,728,927				(3,710,646	)
FINANCING ACTIVITIES
Repayment of notes payable		-	-		-		(200,000	~~(200,000~~)
Increase in bank overdraft		21,900			-			21,900
Settlement of contract Net			214,950				-
Proceeds from notes payable – related parties		90,619			-			553,119
Borrowings of notes payable			654,356				20,000
Issuance of common shares for cash		-			-			150
Issuance of preferred shares for cash			-				14,570,000
Issuance of preferred shares for cash		-			440,000			14,935,000
Net Cash Provided by Financing Activities			869,306				14,390,000
Net Cash Provided by Financing Activities		112,519			440,000			15,310,169
NET DECREASE IN CASH			289,762				2,622,552
CASH AT BEGINNING OF PERIOD			50,695				15,150
CASH AT END OF PERIOD		$	340,457			$	2,637,702
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
CASH PAID FOR:
Interest		$	39,258			$	-
Income taxes		$	19,817			$	-
NON CASH FINANCING & INVESTING ACTIVITIES:
Stock issued for the purchase of AMS		$	630,000
Goodwill
Settlement of contract Net

The accompanying notes are an integral part of these financial statements.

F-3

Table of Contents

BLUE EARTH SOLUTIONS, INC.

(AStatements ~~Development~~of ~~Stage~~Stockholders' ~~Company)~~Equity

Statements of Cash Flows (cont’d)

(unaudited)

	For the Three Months Ended June 30, 2009			For the Three Months Ended June 30, 2008			From Inception on February 5, 2008 Through June 30, 2009
													Deficit
NET INCREASE IN CASH		(50,695)			126,968			-
													Accumulated
CASH AT BEGINNING OF PERIOD		50,695			15,150			-
										Unrealized	Additional		During the
CASH AT END OF PERIOD	$	-		$	142,118		$	-
	Preferred Stock					Common Stock				Gain or loss	Paid-In		Development
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
	Shares		Amount			Shares		Amount				Capital		Stage		Total
CASH PAID FOR:
Balance, February 5, 2008	-		$	-		-	$	-	$	-	$	-	$	-	$	-
Interest	$	30,110		$	-		$	76,288
Common shares issued to founders	-			-		7,000,000		7,000				(6,850)		-		150
Income taxes	$	-		$	-		$	-
Series A preferred shares
NON CASH FINANCING ACTIVITIES:
issued to founders	400,000			400		-		-				(400)		-		-
Property purchased for notes payables	$	-		$	-		$	1,249,000
Series B preferred shares issued in a
private placement at $10 per share	36,500			37		-		-				364,963		-		365,000
Net loss from inception
through March 31, 2008	-			-		-		-				-		(4,583)		(4,583)
Balance, March 31, 2008	436,500			437		7,000,000		7,000		-		357,713		(4,583)		360,567
Recapitalization	-			-		20,759,300		20,759		-		7,099		-		27,858
Common shares returned and cancelled	-			-		(3,200,000)		(3,200)		-		3,200		-		-
Series B preferred shares issued in a
private placement at $10 per share	44,000			44		-		-		-		439,956		-		440,000
Series B preferred shares
converted to common	(80,500)			(81)		1,449,000		1,449		-		(1,368)		-		-
Common shares issued for services
at $6.13 per share	-			-		17,000		17		-		80,733		-		80,750
Series C preferred shares issued in a
private placement at $1,000 per share	14,130			14		-		-		-		14,129,986		-		14,130,000
Dividends on preferred stock	-			-		-		-		-		(945,355)		-		(945,355)
Series A preferred shares converted to common stock	(400,000)			(400)		6,000,000		6,000		-		(5,600)		-		-
Fair value of warrants granted	-			-		-		-		-		985,936		-		985,936
Net loss for the twelve months ended
through March 31, 2009	-			-		-		-		-		-		(2,625,841)		(2,625,841)
Balance, March 31, 2009	14,130			14		32,025,300		32,025		-		15,052,300		(2,630,424)		12,453,915
Common shares returned and cancelled	-			-		(425,000)		(425)		-		425		-		-
Cash-less exercise of warrant	-			-		49,302		49		-		65,523		-		65,572
Dividends on preferred stock	-			-		-		-		-		(565,200)		-		(565,200)
Canceled Common shares issued for
services at $6.13 per share	-			-		(17,000)		(17)		-		(80,733)		-		(80,750)
Acquisition of American Marketing & Sales (AMS)	-			-		1,000,000		1,000		-		449,000		-		450,000
Shares issued to AMS shareholders	-			-		400,000		400		-		179,600		-		180,000
Settlement of contract						500,000		50		-		174,950				175,000
Unrealized Loss on investments held for resale										(1,308,527)
Net loss for the nine months ended
through Septmber 30, 2009	-			-		-		-		-		-		(1,606,642)		(1,606,642)
Balance, September 30, 2009	14,130		$	14		33,532,602	$	33,082	$	(1,308,527)	$	15,275,865	$	(4,237,066)	$	11,071,894

The accompanying notes are an integral part of these ~~unaudited~~ financial statements.

F-4

Table of Contents

BLUE EARTH SOLUTIONS, INC. & SUBSIDIARY

(A Development Stage Company)

Notes to the Financial Statements

~~Period~~For The ofNine ~~February~~Months 5,Ended ~~2008~~September ~~(Inception) to June~~ 30, 2009

NOTE 1 - CONDENSED FINANCIAL STATEMENTS

The accompanying financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations and cash flows at ~~June~~September 30, 2009 and for all periods presented ~~have~~ have been made. The company acquired American Marketing and Sales (AMS) on July 1, 2009 (see Note 9). The numbers in the Company’s Statement of Operations includes only AMS operations since July 1, 2009. None of the historical numbers have been restated with AMS activity.

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. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company's March 31, 2009 ~~audited~~ financial statements. The results of operations for the period ended ~~June~~ September 30, 2009 are not necessarily indicative of the operating results for the full years.

NOTE 2 - GOING CONCERN

The Company’s financial statements are prepared using generally accepted accounting principles applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has limited revenues and has generated losses from operations.

In order to continue as a going concern and achieve a profitable level of operations, the Company will need, among other things, additional capital resources and to develop a consistent source of revenues. Management’s plans include developing and marketing a practical, economical, and environmentally safe means of disposing of and recycling certain polystyrene and expended polystyrene products.

The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plan described in the preceding paragraph and eventually attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

NOTE 3 – SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation:

The accompanying consolidated financial statements present the consolidation of the financial statements of Blue Earth Solutions, Inc and its wholly owned subsidiary American Sales and Marketing, Inc. Intercompany transactions or balances have been eliminated.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Cash and Cash Equivalents:

Cash and cash equivalents consists principally of currency on hand, demand deposits at commercial banks, and liquid investment funds having a maturity of three months or less at the time of purchase.

Inventory:

The Company’s inventory is stated at the lower of cost or market value. Cost is determined using the first in, first out method. Unusual losses resulting from lower of cost or market adjustments or losses on firm purchase commitments, if any, are disclosed, and if material, separately stated from cost of goods sold in the statement of operations.

F-5

Table of Contents

BLUE EARTH SOLUTIONS, INC. & SUBSIDIARY

(A Development Stage Company)

Notes to the Financial Statements

~~Period~~For The ofNine ~~February~~Months 5,Ended ~~2008~~September ~~(Inception) to June~~ 30, 2009

~~NOTE 3 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)~~Investments

~~Recent~~At September ~~Accounting~~30, ~~Pronouncements~~2009, the Company has invested $1,591,473 (after adjustment for market value at September 30, 2009.. The funds are invested as follows;

In· ~~May 2009~~$1, ~~the FASB issued FAS 165~~450,899 ~~“Subsequent~~in ~~Events~~stocks.” This pronouncement establishes standards for accounting for and disclosing subsequent events (events which occur after the balance sheet date but before financial statements are issued or are available to be issued). FAS 165 requires an entity to disclose the date subsequent events were evaluated and whether that evaluation took place on the date financial statements were issued or were available to be issued. It is effective for interim and annual periods ending after June 15, 2009. The adoption of FAS 165 did not have a material impact on the Company’s financial condition or results of operation.

In· ~~June 2009~~$14,228 the FASB issued FAS 166, “Accounting for Transfers of Financial Assets - an amendment of FAS 140.” FAS 140 is intended to improve the relevance, representational faithfulness, and comparability of the information that a reporting entity provides in ~~its financial statements about~~ a ~~transfer~~money ofmarket ~~financial assets: the effects of a transfer on its financial position~~account, financial performance, and cash flows: and a transferor’s continuing involvement, if any, in transferred financial assets. This statement must be applied as of the beginning of each reporting entity’s first annual reporting period that begins after November 15, 2009. The Company does not expect the adoption of FAS 166 to have an impact on the Company’s results of operations, financial condition or cash flows.

In· ~~June 2009~~$25,688 the FASB issued FAS 167, “Amendments to FASB Interpretation No. 46(R).” FAS 167 is intended to (1) address the effects on certain provisions of FASB Interpretation No. 46 (revised December 2003), Consolidation of Variable Interest Entities, as a result of the elimination of the qualifying special-purpose entity concept in ~~FAS~~municipal ~~166,~~bonds and (2) constituent concerns about the application of certain key provisions of Interpretation 46(R), including those in which the accounting and disclosures under the Interpretation do not always provided timely and useful information about an enterprise’s involvement in a variable interest entity. This statement must be applied as of the beginning of each reporting entity’s first annual reporting period that ~~begins~~yield ~~after November 15, 2009~~5.5% ~~The~~interest ~~Company~~and ~~does~~mature ~~not expect the adoption of FAS 167 to have an impact~~ on ~~the~~July ~~Company’s results of operations~~1, ~~financial condition or cash flows~~2010.

In· ~~June 2009~~$100,658 ~~the~~in ~~FASB~~a ~~issued~~long ~~FAS~~term-certificate ~~168, “The FASB Accounting Standards Codification and the Hierarchy~~ of ~~Generally~~deposit ~~Accepted Accounting Principles.” FAS 168 will become the source of authoritative U.S. generally accepted accounting principles~~ (~~GAAP~~CD) ~~recognized~~yields byinterest ~~the FASB to be applied by nongovernmental entities. Rules and interpretive releases~~ of ~~the Securities and Exchange Commission (SEC) under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants~~1.85% ~~On the effective date of this Statement, the Codification will supersede all then-existing non-SEC accounting~~ and ~~reporting~~matures standards. All other non-grandfathered non-SEC accounting literature not included in the Codification will become non-authoritative. This statement is effective for financial statements issued for interim and annual periods ending after September 15, 2009.The Company does not expect the adoption of FAS 168 to have an impact on ~~the~~July ~~Company’s results of operations~~27, ~~financial condition or cash flows~~2010.

The Company has not determined yet whether it will hold the bonds, stocks and certificate of deposit to maturity, and has therefore classified them as available-for-sale securities and has valued them to current market prices at September 30, 2009. The unrealized loss totaled $1,380,527 net and is classified in the Stockholders’ Equity section of the balance sheet.

Property and Equipment:

Property and equipment are stated at cost. Depreciation and amortization are determined using the straight-line method over estimated useful lives ranging from three to twenty five years.

Fair Value of Financial Instruments:

In September 2006, the Financial Accounting Standards Board (FASB) introduced a framework for measuring fair value and expanded required disclosure about fair value measurements of assets and liabilities. The Company adopted the standard for those financial assets and liabilities as of the beginning of the 2008 fiscal year and the impact of adoption was not significant. FASB Accounting Standards Codification (ASC) 820 “Fair Value Measurements and Disclosures” (ASC 820) defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:

Level 1 - Quoted prices in active markets for identical assets or liabilities.

Level 2 - Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable.

Level 3 - Unobservable inputs that are supported by little or no market activity, therefore requiring an entity to develop its own assumptions about the assumptions that market participants would use in pricing.

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of September 30, 2009. The Company uses the market approach to measure fair value for its Level 1 financial assets and liabilities, which includes cash equivalents of $340,357 at September 30, 2009. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values. These financial instruments include cash, trade receivables, and related party payables, accounts payable and accrued liabilities. Fair values were assumed to approximate carrying values for these financial instruments since they are short term in nature and their carrying amounts approximate fair values or they are receivable or payable on demand.

The Company’s investments are categorized as $1,341,473 in Level 1 and $250,000 in Level 3.

On July 1, 2009, the Company entered into a Convertible Note Agreement as part of the AMS purchase Agreement (Note 6).

On April 1, 2009, the Company applied ASC 820 for all non-financial assets and liabilities measured at fair value on a non-recurring basis. The application did not have an impact on the Company’s financial position or results of operations. The Company’s non-financial assets measured at fair value on a non-recurring basis include goodwill and other intangible assets. In a business combination, the non-financial assets and liabilities of the acquired company would be measured at fair value in accordance with ASC 820. The requirements of ASC 820 include using an exit price based on an orderly transaction between market participants at the measurement date assuming the highest and best use of the asset by market participants. The Company would use a market, income or cost approach valuation technique to perform the valuations. Since the Company performs its annual impairment analyses of goodwill and indefinite-lived intangible assets in the fourth quarter of each fiscal year and since no impairment trigger event occurred during the first quarter of 2009, the application of ASC 820 for all non-financial assets and liabilities measured at fair value on a non-recurring basis did not have an impact on the Company’s financial position or results of operations. However, there may be an impact during 2009 on the Company’s financial position and results of operations when the Company performs an impairment analysis of goodwill and indefinite-lived intangible assets due to the difference in fair value methodology required under ASC 820. The carrying value of cash, accounts receivable, accounts payable and accrued expenses, and notes payable are assumed to approximate fair value because of the relatively short maturity of these instruments. However, since the Company has been unable to pay its liabilities as they became due, significant discounts that cannot be estimated may be appropriate for liabilities

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BLUE EARTH SOLUTIONS, INC. & SUBSIDIARY

(A Development Stage Company)

Notes to the Financial Statements

~~Period~~For The ofNine ~~February~~Months 5,Ended ~~2008~~September ~~(Inception) to June~~ 30, 2009

~~NOTE~~Concentrations of 4Credit ~~– INVENTORY~~Risk:

~~The~~Financial instruments that potentially subject the Company’s ~~inventory~~to isconcentrations ~~comprised~~of credit risk consist primarily of ~~chemicals~~cash. ~~for~~The Company maintains its cash accounts with several commercial banks. Cash balances are insured by the ~~recycling~~Federal ofDeposit Insurance ~~polystyrene~~Corporation, ~~and~~up isto ~~comprised~~$250,000 ofper ~~the~~financial ~~following:~~institution.

	June 30, 2009		March 31, 2009
Raw materials	$	199,652	$	231,153
Finished goods		52,598		-
Work in process		-		-
Total	$	252,250	$	231,153

Revenue Recognition:

On August 29, 2008, the Company completed and closed a private offering of newly-created Series C Preferred Stock at an offering price of $1,000 per share in a private placement. The Company sold a total of 14,130 shares for total gross proceeds of $14,130,000, including $13,430,000 in cash and the cancelation of the $700,000Blue ~~promissory~~Earth ~~note (see Form 8K filed August 13~~Solutions, ~~2008)~~Inc. Of the proceeds, $8,500,000 was deposited in a fund in an offshore account. Upon deposit, we signed an agreement (the “Agreement”) governing the Funds, which was not countersigned by the fund administrator. As a result, there remains a dispute as to the control and dispositions of the Funds which management is currently exploring. The Agreement details the investment return that the Company will earn on the Funds. Additionally, pursuant to the Agreement, the Company agreed to wait to withdraw $8,000,000 of the Funds until one of several stated conditions were met. The Company was and is entitled to withdraw the earnings, less the investment fees, generated by the Funds without restriction.

The ~~Funds were classified as a current asset at March 31, 2009 because they were considered by management to be a liquid asset. During the quarter ended March 31, 2009, the~~ Company ~~was~~recognizes ~~unsuccessful~~revenue ~~issuing~~upon ~~bonds in a depressed bond market, which put a strain on~~ the ~~Company~~rendering ~~to meet its operating expenses. During the quarter ended June 30, 2009, the Company attempted to withdraw some~~ of ~~the~~services ~~Funds,~~and ~~but~~shipment ~~met resistance from the fund management with respect to the release~~ of finished ~~the~~goods ~~Funds. The Company is taking steps~~ to ~~get the Funds released~~customers. ~~In the interim, the Company is re-classifying the Funds as a non-current asset until such time that the Funds are released.~~

American Market & Sales, Inc.

The Company recognizes revenue from product sales in accordance with Staff Accounting Bulletin No. 104, which requires recognition when persuasive evidence of an arrangement exists, the price is fixed or determinable, delivery has occurred, and payment is reasonably assured. The Company has determined that these criteria have been met upon shipment, and recognizes revenue at that point. Pursuant to SFAS No. 5, “Accounting for Contingencies,” the Company has examined collection history, financial conditions of clients, and general economic conditions and determined that an allowance of $17,000 would be adequate.

Cost of Revenue:

Subsequent Events

In preparing these financial statements, the Company has evaluated events and transactions for potential recognition or disclosure through December 24, 2009, the date the financial statements were issued.

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BLUE EARTH SOLUTIONS, INC. & SUBSIDIARY

(A Development Stage Company)

Notes to the Financial Statements

~~Period~~For The ofNine ~~February~~Months 5,Ended ~~2008~~September ~~(Inception) to June~~ 30, 2009

NOTE 3 6 – ~~NOTES~~SIGNIFICANT ~~PAYABLE-RELATED~~ACCOUNTING ~~PARTIES~~POLICIES (CONTINUED)

At March 31, 2009, the Company had a total of $462,500 in related party notes payable. During the three months ended June 30, 2009, the Company received an additional $90,619 in advances, resulting in a balance of $553,119 at June 30, 2009. The notes payable are interest bearing, secured by equipment, and are due andRecent ~~payable~~Accounting ~~upon demand. The notes bear interest at 8% to 12% per annum.~~Pronouncements

Statement of Financial Accounting Standards ("SFAS") SFAS No. 165 (ASC Topic 855), "Subsequent Events," SFAS No. 166 (ASC Topic 810), "Accounting for Transfers of Financial Assets-an Amendment of FASB Statement No. 140," SFAS No. 167 (ASC Topic 810), "Amendments to FASB Interpretation No. 46(R)," and SFAS No. 168 (ASC Topic 105), "The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles-a replacement of FASB Statement No. 162," were recently issued. SFAS No. 165, 166, 167, and 168 have no current applicability to the Company or their effect on the financial statements would not have been significant.

Accounting Standards Update ("ASU") ASU No. 2009-05 (ASC Topic 820), which amends Fair Value Measurements and Disclosures - Overall, ASU No. 2009-13 (ASC Topic 605), Multiple-Deliverable Revenue Arrangements, ASU No. 2009-14 (ASC Topic 985), Certain Revenue Arrangements that include Software Elements, and various other ASU's No. 2009-2 through ASU No. 2009-15 which contain technical corrections to existing guidance or affect guidance to specialized industries or entities were recently issued. These updates have no current applicability to the Company or their effect on the financial statements would not have been significant.

Segment Information:

ASC Topic 280 (SFAS No. 131) requires public enterprises to report certain information about operating segments, including products and services, geographic areas of operations, and major customers. American Marketing and Sales, Inc. (AMS) is considered a separately reportable business segment that meets the ’Single Industry Dominance’ test, which eliminates the segment disclosure requirements if the segment accounts for 90% or more of the combined revenue, reported profit, and assets. The revenues, profits, and assets reported in the consolidated financial statements are primarily those of AMS.

NOTE 4 – INVENTORY

Blue Earth Solutions, Florida inventory is comprised of chemicals for the recycling of polystyrene and finished pellets awaiting shipment, and is comprised of the following:

	September 30, 2009		March 31, 2009
Raw materials	$	11,209	$	231,153
Finished goods		8,672		-
Work in process		-		-
Total	$	19,881	$	231,153

AMS produces caterware for the food service industry via an intense heat injection molding process using Polystyrene/Polypropylene recycled resins. The raw materials and finished goods are produced and held by two third-party manufacturing plants, from where they are shipped to customers across the nation. AMS does not enter into long-term contracts and generally experiences a high inventory turnover ratio while maintaining minimal quantities on-hand in the warehouses. AMS ‘s inventory is as follows:

	September 30, 2009		March 31, 2009*
Raw materials	$	2,100	$	4,560
Finished goods		186,935		587,033
Work in process		64,970		176,309
Total	$	254,005	$	767,902

* For information purposes only not included in March 31, 2009

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BLUE EARTH SOLUTIONS, INC & SUBSIDIARY

Notes to the Financial Statements

For The Nine Months Ended September 30, 2009

NOTE 5 – SERIES C PREFERRED STOCK AND DEPOSITORY FUNDS

On August 29, 2008, the Company completed and closed a private offering of newly-created Series C Preferred Stock at an offering price of $1,000 per share in a private placement. The Company sold a total of 14,130 shares for total gross proceeds of $14,130,000, including $13,430,000 in cash and the cancelation of the $700,000 promissory note (see Form 8K filed August 13, 2008). Of the proceeds, $8,500,000 was deposited in a fund in an offshore account. There is a dispute as to the control and dispositions of the Funds which management is currently exploring. The Agreement details the investment return that the Company will earn on the Funds. Additionally, pursuant to the Agreement, the Company agreed to wait to withdraw $8,000,000 of the Funds until one of several stated conditions were met. The Company was and is entitled to withdraw the earnings, less the investment fees, generated by the Funds without restriction.

The Funds were classified as a current asset at March 31, 2009 because they were considered by management to be a liquid asset. During the quarter ended March 31, 2009, the Company was unsuccessful issuing bonds in a depressed bond market, which put a strain on the Company to meet its operating expenses. During the quarter ended June 30, 2009, the Company attempted to withdraw some of the Funds, but met resistance from the fund management with respect to the release of the Funds. The Company is taking steps to get the Funds released. In the interim, the Company is re-classifying the Funds as a non-current asset in all periods until such time that the Funds are released.

NOTE 6 – NOTES PAYABLE RELATED PARTIES

At March 31, 2009, the Company had a total of $462,500 in related party notes payable. During the six months ended September 30, 2009, the Company received an additional $220,167 in advances, resulting in a balance of $682,657 at September 30, 2009. The notes payable are interests bearing, secured by the assets of the Company and are due and payable upon demand. The notes bear interest at 8% to 12% per annum.

As part of the purchase of AMS, the Company entered into a $5,450,000 note secured by the assets and stock of AMS and payable to the former stockholders of AMS. The note accrues interest at 6% and the entire note balance, including accrued interest, is due and payable on December 7, 2010. During the term of the extended Note, the former stockholders shall have the right to convert the principal and interest then due, into Blue Earth (restricted with piggy-back registration rights) common shares at the price of $6 per share. The note is subject to a market interest rate-discount of $750,486 which will be amortized over the life of the note. Accrued interest totaled $82,422 and the amortized discount totaled $215,713 for the three months ended September 30, 2009 both are included in accounts payable and accrued expenses.

NOTE 7 – LONG-TERM NOTES PAYABLE

On August 6, 2008, the Company purchased real property and improvements it uses as its headquarters for a total purchase price of $1.7 million. The Company executed a mortgage, backed in favor of the seller of that property, in the principal amount of $1,049,000, due in three years, with interest only payments due monthly until ~~maturity~~ maturity in the amount of $6,119. The mortgage was personally guaranteed by the Company’s ~~CEO~~Chief Executive Officer and her spouse.

In May 2007, The Company entered into a note payable with Flagship Bank of Leominster, MA for $400,000. The note accrues interest at prime less .75% (approximately 6.5%), carries monthly payments that annually total of $93,918, and matures in May 2012. The Company is current on its payments, so there was no accrued interest at September 30, 2009 or 2008. Future maturities as of September 30, 2009 are as follows:

Dec. 31,	Payments		Principal		Interest
2009		49,110		35,729		13,381
2010		93,918		83,183		10,735
2011		93,918		88,754		5,164
2012		37,979		37,560		419
Totals		274,925		245,226		29,699

NOTE 8 – STOCKHOLDERS’ EQUITY

During the ~~three~~six months ended ~~June~~September 30, 2009, the Company accrued Preferred Series C cumulative dividends of $~~282~~565,~~600~~200, which was recorded as a reduction in additional paid-in capital. The Company also issued 49,302 common shares pursuant to warrants exercised via $65,~~523~~572 in services rendered. Also during the quarter, 442,000 common shares were returned to the Company and cancelled pursuant to the cancellation of the underlying contract. The company also issued 500,000 shares to settle a contract with a vendor. The AMS acquisition (see note 9) had an effect on Common Stock of 1,400,000 shares and a net increase in Common stock and Paid in Capital of $747,711.

~~NOTE~~ F-9 ~~– SUBSEQUENT EVENTS~~

~~On July 1, 2009, the Company completed the purchase~~ Table of American Management & Sales, Inc., which is in the plastic injection molding business. AMS’s operations complement the Company’s business plan, which is the recycling of styrofoam back into plastic pellets that can be used in the injection molding industry. The acquisition was made pursuant to the following terms:Contents

BLUE EARTH SOLUTIONS, INC & SUBSIDIARY

Notes to the Financial Statements

For The Nine Months Ended September 30, 2009

NOTE 9 –ACQUISITION

On July 1, 2009, the Company completed the purchase of AMS., which is in the plastic injection molding business. The company has not completed its financial evaluation of all the assets of AMS, we are still evaluating the value of the revenue stream (existing customers), this evaluation is expected to be completed in the next six months. AMS’s operations complement the Company’s business plan, which is the recycling of expended polystyrene products back into plastic pellets that can be used in the injection molding industry. The acquisition was made pursuant to the following terms:

On March 18, 2009, Datameg Corporation, a Delaware corporation ("Seller") entered into a Stock Purchase Agreement and purchase money promissory note Assignment and Assumption Agreement incident to its proposed sale of its wholly owned subsidiary, American Marketing & Sales, Inc., a Massachusetts corporation. The sale was subject to the consent of a majority of Datameg’s shareholders, which consent was obtained.

· ~~Leonard~~Assets J.acquired ~~Tocci~~were is the representative of the Principal Shareholders (Leonard J. Tocci, Lynel J. Tocci, Leanne J. Whitney, and Linnea J. Clary) who are the former owners of all American Marketing & Sales, Inc.’s and are now owners of the 150,000 Datameg shares in escrow from their sale of American Marketing to Datameg Corporation in December 2007. The Principal Shareholders also hold a purchase money note ("Note") secured by all of the assets of American Marketing concerning an election to return the 150,000 Datameg shares in favor of full payment of the purchase money note. As of December 31, 2008, the principal and interest due on the Note is approximately $5.4 ~~Million consisting of a Note face amount of $4 Million and additional loans and accrued interest of approximately $1~~,~~418~~116,000. including:

~~F-8~~o $689,000 Cash

o	$1,133,000 Net Trade Receivables

o	$192,000 Inventory

o	$1,695,000 Property Plant & Equipment

o	$400,000 Investments

o	$7,000 Other

·	Liabilities acquired were $1,438,000

o	$1,193,000 Accounts Payable & Accrued Expenses

o	$245,000 Bank Loan

Leonard J. Tocci is the representative of the Principal Shareholders (Leonard J. Tocci, Lynel J. Tocci, Leanne J. Whitney, and Linnea J. Clary) who are the former AMS owners and are now owners of the 150,000 Datameg shares in escrow from their sale of American Marketing to Datameg Corporation in December 2007. The Principal Shareholders also hold a purchase money note ("Note") secured by all of the assets of American Marketing concerning an election to return the 150,000 Datameg shares in favor of full payment of the purchase money note. As of September 30, 2009, the principal and interest due on the Note is approximately $5.600,000 consisting of $5.400,000 in principal and $200,000 of interest.

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BLUE EARTH SOLUTIONS, INC. & SUBSIDIARY

(A Development Stage Company)

Notes to the Financial Statements

~~Period~~For The ofNine ~~February~~Months 5,Ended ~~2008~~September ~~(Inception) to June~~ 30, 2009

NOTE 9 – ~~SUBSEQUENT~~ACQUSITION ~~EVENTS~~ (CONTINUED)

· The purchase of American Marketing & Sales, Inc. was made pursuant to a Stock Purchase Agreement. The Stock Purchase Agreement contained, among other things, representations and warranties of the aforementioned Parties and covenants of the Companies. Blue Earth Solutions is allowed to make additional draws from available cash of AMS for the purpose of meeting additional operating capital with respect to new customers secured by the Company for AMS after the closing of the Agreement.

Among other terms, Datameg received 1 million (restricted with piggy-back registration rights) common shares of the Company in exchange for the transfer of American Marketing shares to the Company. Datameg delivered to the Principal Shareholders from escrow 150,000 Datameg common shares in exchange for (1) a complete release of Datameg and its directors and officers, etc. from further liability upon the Note and otherwise (2) the Principal Shareholders’ written consent to the assumption of the Note by the Company (3) the Company's written assumption of the Note and (4) the Principal Shareholder’s and the Company’s agreement to extend the term of the Note for one year.

· During the term of the extended Note, Mr. Tocci shall have the right to convert the principal and interest then due into Blue Earth (restricted with piggy-back registration rights) common shares at the price of $6 per share.

·	For their assumption of the additional loans from American Marketing & Sales, Inc. on the Note, the Company was issued 500,000 unregistered Datameg common shares at the Closing.

·	The Principal Shareholders released their security interest in NetSymphony Corporation stock and returned the stock certificate to Datameg.

·	In consideration of their aforementioned acts and consents, the Company delivered to the Principal Shareholders 400,000 (restricted with piggy-back registration rights) common shares of the Company common shares.

The 500,000 shares of Datameg’s common stock issued to the Company had a value of $4.50 per share ($2,250,000 total value). Just prior to the sale, the Datameg also issued to AMS an additional 120,000 shares of common stock at $4.70 for total value of $564,000. The 1,000,000 shares issued by the Company to Datameg had a fair market value of $450,000 on the closing date, and represent a 3% ownership in the Company.

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Table of Contents

BLUE EARTH SOLUTIONS, INC.

(A Development Stage Company)

Notes to the Financial Statements

Period of February 5, 2008 (Inception) to June 30, 2009

NOTE 8 – SUBSEQUENT EVENTS (CONTINUED)

BLUE EARTH SOLUTIONS, INC.

UNAUDITED PRO FORMA FINANCIAL INFORMATION

The Unaudited Pro Forma Financial Information reflects financial information, which gives effect to the purchase of all the common stock of American Marketing and Sales, Inc., a Massachusetts corporation ("AMS"), by Blue Earth Solutions, Inc. (“BES”) (“the Company”) from Natural Blue Resources, Inc. (formerly Datameg Corp.) (“NBR”). The Company acquired the net assets of AMS and 500,000 shares of NBR stock valued at $4.50 per share ($2,250,000 total value) in exchange for the assumption from NBR of $5,450,000 in loans and accrued interest payable to AMS and the issuance of 1,000,000 of BES shares (valued at $.45 per share or $450,000 total) to NBR, resulting in a net purchase price of $3,650,000. The fair market value of AMS at July 1, 2009 was determined to be $5,835,629, resulting in a gain on the acquisition of $2,185,629. The Company also issued 400,000 BES shares (valued at $.45 per share or $180,000 total) to former principal AMS shareholders that were expensed as business acquisition costs.

The Company’s acquisition of AMS was considered completed on July 1, 2009, and was accounted for using the purchase method of accounting pursuant to the provisions in SFAS 141R, "Business Combinations."

The Company’s fiscal year-end is March 31, while AMS’s year-end is December 31. Since the year-ends are less than 93 days apart, Regulation S-X allows the combination of each company’s most recent fiscal year-end and first quarter-end to satisfy annual and interim pro-forma reporting requirements. The following pro-forma financial statements give effect to the transaction as if it had occurred at the beginning of each period presented. Such financial information is provided below and has been prepared from and should be read in conjunction with the historical financial statements of Datameg and AMS.

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Table of Contents

BLUE EARTH SOLUTIONS, INC.

Pro-Forma Combined Balance Sheets

	BES March 31, 2009		AMS December 31, 2008		Combining Adjustments		Ref	Combined Pro-Forma Financials
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	50,695	$	379,907				$	430,602
Accounts receivable		10,907		1,222,648					1,233,555
Loan Receivable		-		754,175					754,175
Prepaid expenses		41,421		-					41,421
Inventory		231,153		284,221					515,374
Total Current Assets		334,176		2,640,951		-			2,975,127
PROPERTY AND EQUIPMENT, net		6,910,347		2,315,372		2,185,629	5		11,411,348
OTHER ASSETS
Depository funds		8,206,990		-					8,206,990
Investment In Subsidiary		-				450,000	1		-
						(450,000)	2		-
Investments in available-for-sale securities		-		-		2,250,000	3		2,250,000
Deposits		65,555		-		-			65,555
Total Other Assets		8,272,545		-		2,250,000			10,522,545
TOTAL ASSETS	$	15,517,068	$	4,956,323		4,435,629		$	24,909,020
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued expenses	$	1,551,653	$	416,041		360,000	6	$	2,327,694
Notes payable		-		69,224					69,224
Notes payable - related parties		462,500		-					462,500
Total Current Liabilities		2,014,153		485,265		360,000			2,859,418
LONG-TERM LIABILITIES
Notes payable		1,049,000		209,497		5,090,000	6		6,348,497
Total Current Liabilities		3,063,153		694,762		5,450,000			9,207,915

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BLUE EARTH SOLUTIONS, INC.

Pro-Forma Combined Balance Sheets

	BES March 31, 2009		AMS December 31, 2008		Combining Adjustments		Ref	Combined Pro-Forma Financials
STOCKHOLDERS' EQUITY
BES Preferred stock, Series A, $0.001 par value, 10,000,000 shares authorized, -0- and 400,000 shares issued and outstanding		-
BES Preferred stock, Series B, $0.001 par value, 5,000,000 shares authorized, -0- and 36,500 shares issued and outstanding, respectively		-
BES Preferred stock, Series C, $0.001 par value, 5,000,000 shares authorized, 14,130 and no shares issued and outstanding, respectively		14							14
BES Common stock, $0.001 par value, 100,000,000 shares authorized, 33,425,300 shares issued and outstanding		32,025				1,000	1		33,425
						400	4
AMS Common stock, no par value, 5,000 shares authorized and issued				1,000		(1,000)	2		-
									-
Additional paid-in capital		15,052,300		998,173		449,000	1		16,292,461
						(998,173)	2
						3,811,561	2
						2,250,000	3
						179,600	4
						(5,450,000)	6
Deficit accumulated during the development stage (BES) / Retained earnings (AMS)		(2,630,424)		3,262,388		(3,262,388)	2		(624,795)
						(180,000)	4
						2,185,629	5
Total Stockholders' Equity		12,453,915		4,261,561		(1,014,371)			15,701,105
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	15,517,068		4,956,323		4,435,629		$	24,909,020

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BLUE EARTH SOLUTIONS, INC.

Pro Forma Combined Statements of Operations

For The Twelve Months Ended

	BES March 31, 2009		AMS December 31, 2008		Combining Adjustments		Ref	Combined Pro-Forma Financials
REVENUES	$	31,867	$	10,912,794				$	10,944,661
COST OF SALES		( 64,991)		(9,412,426)					(9,477,417)
Gross Profit (Loss)		(33,124)		1,500,368		-			1,467,244
OPERATING EXPENSES
General and administrative		2,765,484		1,047,490					3,812,974
NET INCOME (LOSS) FROM OPERATIONS		(2,798,608)		452,878		-			(2,345,730)
OTHER INCOME (EXPENSES)
Gain on acqusition		-		-		2,185,629	5		2,185,629
Interest income		224,853		-		-			224,853
Interest expense		(52,086)		(16,243)		-			(68,329)
Total Other Income (Expenses)		172,767		(16,243)		2,185,629			2,342,153
NET INCOME (LOSS) BEFORE INCOME TAXES		(2,625,841)		436,635		2,185,629			(3,577)
Income taxes		-		-		-			-
NET INCOME (LOSS)	$	(2,625,841)	$	436,635	$	2,185,629		$	(3,577)
BASIC INCOME (LOSS) PER COMMON SHARE	$	(.13)	$	143	$	(143)	7
						.13	7	$	(.00)
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING		19,512,650		5,000		(5,000)	7
						1,400,000	7		20,912,650

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PRO FORMA COMBINING ADJUSTMENTS:

1 To record investment in AMS subsidiary purchased by BES for 1,000,000 shares of BES stock at $.45 per share ($450,000 total value).

2 To eliminate AMS equity accounts and BES’s investment in AMS in consolidation.

3 To record investment in Natural Blue Resources, Inc. BES received 500,000 shares of NBR stock at $4.50 per share for total investment of $2,250,000, in exchange for BES’s assumption of $5,450,000 in loans made by AMS to NBR.

4 To record as a business acquisition cost, the issuance of 400,000 BES shares at $.45 per share ($180,000 total value) to former AMS principal stockholders.

5 To record a write-up on tooling molds to fair market value on the acquisition date, and related depreciation.

6 To record loans assumed by BES that were payable by NBR to AMS (see 3 above).

7 To eliminate AMS’s earnings per share in consolidation and record 1,400,000 BES shares issued in acqusition.

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

Blue Earth Solutions, Inc. is hereafter referred to as “we”, “our” or “us”.

Forward-Looking Statements

Certain statements, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives, and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements generally are identified by the words “believes,” “project,” “expects,” “anticipates,” “estimates,” “intends,” “strategy,” “plan,” “may,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. We intend such forward-looking statements to be covered by the safe-harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and are including this statement for purposes of complying with those safe-harbor provisions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse affect on our operations and future prospects on a consolidated basis include, but are not limited to: changes in economic conditions, legislative/regulatory changes, availability of capital, interest rates, competition, and generally accepted accounting principles. These risks and uncertainties should also be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Further information concerning our business, including additional factors that could materially affect our financial results, is included herein and in our other filings with the SEC.

Plan of Operation

Overview

As of September ~~June~~ 30, 2009, we conduct ~~limited~~our operations ~~only~~ from our facility at 13511 Granville Ave., Clermont, FLFlorida, ~~34711,~~ utilizing our Blue Line system~~. Our~~, ~~Blue~~which ~~Line system~~ primarily uses established recycling technologies and methods. Compared to our Styrosolve™ system, the Blue Line creates less waste, converts a higher percentage of expanded polystyrene, (otherwise known as EPS) into useable crystal polystyrene pellets, reduces energy consumption, requires no chemical inputs, occupies less square footage, and is less labor intensive. The Blue Line system is presently ~~running~~ operating and producing pellets that are being sold on a commercial basis.

~~We had~~ Although we anticipated beginning recycling operations on a full commercial scale during the quarter ended September 30, 2008, ~~but~~ we have experienced unexpected delays. due to our ~~The~~abandonment ~~Styro~~and ~~Solve~~dismantling of the Styrosolve™ system isthat ~~not~~we ~~operational~~previously ~~and~~used isto ~~proving~~process topellets and bereplacing ~~impossible~~it towith ~~utilize~~the onBlue aLine ~~large~~system. ~~scale~~During ~~manufacturing~~the ~~basis.~~quarter Weended ~~may~~September 30, or2009, ~~may~~we ~~not~~began dismantling bethe ~~able~~Styrosolve™ tooperation, ~~overcome~~but ~~the~~we not ~~challenges~~know when that dismantling ~~arise~~process ~~and~~will ~~conduct~~be completed. Some ~~operations~~equipment ~~successfully~~from onthis adismantling ~~scale~~process may ~~necessary~~be toutilized ~~achieve~~in ~~profitable~~our operations~~. Therefore~~, ~~our~~as ~~processes~~accounted ~~must~~for bein ~~considered~~the ~~unproven~~necessary ~~technologies~~ reserves and aadjustments ~~high-risk~~in ~~business~~our ~~plan~~financial statements.

~~The Company has~~ We have received a third-party claim ~~that~~alleging ~~alleges~~ that the ~~party~~seller ~~that sold~~ of the Styrosolve™ patents ~~to the Company~~ did not have the legal right to sell them. ~~The~~to us; ~~Company~~however, ~~believes~~we believe that itwe ~~has~~ have clear title to the patents and iswe are presently investigating ~~the~~this claim.

American Marketing and Sales, Inc. D/B/A INNOVATIVE DESIGNS, our Wholly Owned Subsidiary

AMS has developed and introduced a line of environmentally friendly, injection-molded Green Line food-packaging/cater ware products. We have twenty-five (25) Green Line products, including various size trays, party platters, and serving bowls with lids. These non-toxic products qualify for the Green label because they are manufactured from Federal Food and Drug Administration approved polypropylene and polystyrene resins that contain up to 40 percent recycled plastic content. . American Marketing also produces office products, including desk top organizers, letter trays, legal letter trays, pencil holders, paper clip and card holders, magazine holders, and telephone and draw organizers.

Plan for other Products and Services

Assuming we obtain sufficient funding or generate sufficient revenues, we plan to expand American Marketing’s sales operations, particularly in its office product line.

In addition to our recycling operations, we produce, market and distribute six other products on a limited basis, including Tire Muscle®, Dumpster Ease, Diaper Ease, Nu-silver, Nu-Brass, and Nu-Chrome, which represent products such as a tire fix, odor eliminator in commercial dumpsters, and polish enhancing formulas. We intend to continue producing small amounts of these products for existing customers while seeking other companies or individuals that may wish to purchase the rights to these products.

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Anticipated Expenses in the next twelve months

Over the next twelve months, we intend our efforts to extend our operations beyond our Clermont, Florida plant to processing centers in Memphis, TN and Atlanta, GA. We do not presently have sufficient capital to fully proceed with this expansion plan. In connection with raising this additional capital, we will incur appropriate accounting and legal fees. Our ability to open additional processing centers will be dependent upon our success in obtaining financing, primarily through municipal bond offerings sponsored by the communities where we plan to build processing centers. Thus far we have been unsuccessful in obtaining this financing, which has delayed our efforts to add additional facilities. Should we continue to be unsuccessful in obtaining municipal bond financing, our business plan may be further delayed.

Should we be successful in obtaining the necessary municipal bond financings to open additional facilities, we anticipate that the approximate expenses associated with the cost of opening and operating each processing center for twelve months will be as follows:

Processing Center

Item	Average Cost of Opening
Building and improvements	$	3,069,188
Two processing lines	$	1,510,000
Equipment, electrical, etc. common to both lines	$	440,000
Material handling equipment	$	98,600
Recycling equipment	$	25,500
Transportation equipment	$	900,000
Miscellaneous maintenance and safety equipment	$	14,500
Office furniture	$	21,750
Operational and production technology	$	742,800
Start-up expenses	$	416,950
Total	$	7,239,288

We also expect to incur approximately $1,190,000 per year in other expenses including: executive salaries totalling $825,000 annually; office supplies, phones, and miscellaneous expenses totalling $90,000 annually; marketing and public relation costs of $125,000 annually, including three staff members; and legal and accounting fees totalling $250,000 annually. Including the above, we anticipate that we will require approximately $9,000,000 per location in order to fully implement our business plan in the next twelve months.

Plan for other Products and Services

In addition to our recycling operations, we produce six other products on a very limited basis, including Tire Muscle®, Dumpster Ease, Diaper Ease, Nu-silver, Nu-Brass, and Nu-Chrome. These products have a limited customer base and have not been heavily marketed or distributed. We intend to continue producing small amounts of these products for existing customers while seeking other companies or individuals that may wish to purchase the rights to these products.

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Marketing Plan & Sales Strategy

Our goal is to become ~~the~~ an industry leader in polystyrene recycling. ~~the~~We have ~~recycling~~become involved in other types of materials, ~~polystyrene.~~such ~~Our~~as other plastics, carpet, cardboard, and fabrics. Our initial marketing efforts will focus on acquiring EPS for recycling and re-sale as ~~Pellets~~pellets, which are used for producing plastic products that are labeled “produced with recycled materials.” We will attempt to ~~build~~develop ~~relationships~~an infrastructure that will ~~aid~~enable us inacquire ~~acquiring~~ scrap EPS from the construction ~~industry,~~and ~~the~~ packaging ~~industry~~industries, local and state governments, military bases and vessels, and the food services industry. Our ~~executive~~ management will ~~initially~~ be responsible for presenting the ~~contacting~~fiscal and ~~creating~~environmental benefits ~~relationships~~of ~~with~~utilizing ~~decision-makers~~our ~~within~~products ~~these~~and ~~areas.~~services ~~They~~to ~~will~~decision ~~present~~makers ~~information~~in ~~regarding~~ the foregoing ~~fiscal, environmental, and public relations impact of utilizing our services~~industries. .

We ~~also~~ intend to ~~increase~~use ~~public~~Internet-based ~~awareness of our company~~ and ~~our~~traditional ~~Process~~media to ~~create~~increase public ~~support~~awareness ~~for~~of our brand ~~services.~~name Weand ~~intend~~processes ~~to use Internet-based~~ and ~~traditional~~our ~~media~~attempted sales to ~~accomplish this~~large organizations. We Ifalso ~~the~~intend ~~general~~to ~~public~~introduce ~~supports~~ our ~~efforts~~technologies ~~for~~and processes ~~environmental~~in ~~reasons, we feel that~~ the ~~likelihood~~recycling ofindustry ~~large~~through ~~organizations utilizing~~ our ~~services~~attendance ~~increases~~at ~~significantly.~~trade Wegroups ~~also~~and meetings, ~~intend~~promotional toevents, ~~work~~seminars, ~~closely~~national ~~with~~conferences ~~trade~~and ~~groups~~other organizations, including the International Expanded Polystyrene ~~recycling~~ Recycling Association (“INEPSA”) and the Alliance of Foam Packaging Recyclers (“AFPRA”) and tothose events ~~introduce~~attended ~~the~~by organizations that generate ~~technology~~a tolarge ~~the~~amount ~~industry.~~of Byscrap ~~coordinating~~EPS ~~our~~and ~~public~~other ~~awareness~~materials ~~campaigns~~that ~~with~~will ~~theirs,~~be wein ~~feel~~need ~~we can educate a broader audience regarding the recycling~~ of our ~~EPS~~products ~~in general,~~ and ~~regarding our~~ services ~~in particular~~.

We intend to ~~also~~work ~~plan~~with onlandfills ~~attending~~serving ~~relevant~~the ~~national~~areas ~~events~~around our processing center and transfer ~~conferences~~stations. ~~There~~By ~~are~~intercepting ~~events~~EPS ~~and~~bound ~~conferences~~for ~~managed~~the bylandfill, ~~national~~our ~~institutions~~goal ~~and~~is to extend ~~organizations~~the tolandfill’s ~~promote~~life ~~their~~by ~~respective~~reducing ~~industries~~BPS’s environmental impact. Similarly, Wewe ~~plan~~will attempt to provide ~~attend~~EPS arecycling ~~number~~on ofa ~~events~~residential level ~~attended~~in bycommunities ~~the~~where ~~organizations~~there ~~mentioned~~is ~~above~~an ~~that~~existing residential ~~generate~~recycling pick-up aprogram. ~~large~~We ~~amount~~will ofattempt ~~scrap~~to ~~EPS.~~partner ~~These~~with ~~events~~those ~~will~~companies ~~include~~that are ~~trade~~already ~~meetings~~collecting paper, ~~promotional events~~aluminum, ~~seminars,~~ and ~~conferences~~glass products, which allow them ~~are~~to ~~heavily~~add ~~attended~~EPS byto ~~decision-makers~~their ~~within~~list ~~those~~of ~~industries,~~recyclable inmaterial ~~order~~and providing toadditional ~~further~~scrap ~~expose~~EPS ~~our~~for ~~services~~us to process.

WeIn addition ~~intend~~ to ~~work~~acquiring ~~with~~scrap ~~landfills serving the areas around our processing center and transfer stations. By intercepting~~ EPS ~~bound~~to ~~for~~recycle ~~the~~into ~~landfill~~Pellets, we ~~believe~~sell those ~~that we can extend the life of the landfill and reduce the environmental impact of EPS~~Pellets. Our ~~Similarly,~~executive wemanagement will ~~work~~ attempt to ~~provide~~establish ~~EPS~~contacts ~~recycling~~within onthe aindustry ~~residential~~by ~~level in communities where~~establishing ~~there~~relationships, isarrangements ~~already~~and aagreements ~~residential~~with ~~recycling~~companies ~~pick-up~~that ~~program~~manufacture products infrom ~~place~~polystyrene. As In such ~~cases~~, we will ~~attempt~~promote toa mutual public ~~partner~~relations ~~with those companies that are already picking up paper~~arrangement, ~~aluminum,~~where ~~and~~these ~~glass~~companies ~~products,~~will ~~allowing~~be able ~~them~~ to ~~add~~promote ~~EPS to~~ their ~~list~~products ofas ~~recyclable~~both ~~material~~recycled and ~~providing~~recyclable ~~additional~~and we will promote ~~scrap~~sale ~~EPS~~of ~~for~~our uspellets.

~~In addition to acquiring scrap EPS to recycle into Pellets~~With American Marketing, we will ~~need~~continue to sell ~~the~~our ~~Pellets,~~catering ~~which we will produce. The market for polystyrene pellets, however, is open~~ and ~~well-established.~~food ~~While~~service weproducts ~~plan~~ to ~~expend as much effort as we deem necessary to sell our Pellets, demand within the plastics manufacturing industry is such that we~~ dolarge ~~not~~user ~~anticipate~~stores ~~any difficulties in selling our Pellets. Polystyrene pellets are the same regardless of the supplier~~ and ~~prices~~big ~~are~~box ~~relatively fixed~~markets. We ~~Our~~also ~~executive~~have ~~management~~started ~~will work~~ to ~~establish~~begin marketing ~~contacts~~our ~~within~~recycled ~~the~~office ~~industry~~product toline ~~ensure~~into ~~that~~big webox ~~are~~settings, ~~able~~as towell ~~participate~~as indevelop relationships ~~this market in a profitable manner. By working closely~~ with ~~companies~~sales ~~that~~and ~~manufacture~~marketing ~~products~~representatives ~~from~~who ~~polystyrene, we~~ will ~~also~~sell ~~be able to provide a public relations boost to these partners, as they will be able to promote their~~ our products on ~~as both recycled and recyclable. These types of partnerships should further ensure~~ a ~~steady~~commission ~~market~~only ~~for our Pellets~~basis.

Sales Personnel

As of September ~~June~~ 30, 2009, we have hired and deployed one sales person to focus on foam collection in the Central Florida area. We have contracted ~~been contracting~~ with independent marketing representatives to sell and distribute Tire Muscle, Dumpster Ease and other proprietary formulas and polishes. In addition, we will continue to use the services of our executive management to sell our services and products. ~~As the area in which~~ Should our services and products expand ~~are~~and ~~offered~~sales ~~expands~~increase, ~~however,~~ we plan to employ additional regional sales representatives to promote and sell our recycling services to governments, companies, and the general public. ~~These~~ Each sales representative ~~representatives~~ will be responsible for soliciting, selecting and securing accounts ~~within~~ on a ~~particular~~ regional ~~territory~~territorial basis. We intend to ~~may~~provide orservice ~~may~~and ~~not~~support ~~continue~~to ~~this~~our ~~pay~~sales ~~policy~~representatives, including ~~depending~~advertising onand ~~the~~sales ~~territory~~materials. American inMarketing currently ~~the~~deals ~~country.~~ with twelve (12) manufacturing sales representatives, which are Wedivided ~~expect~~into toa ~~provide~~food ~~service~~packaging and ~~support~~services toand ~~our~~retail ~~sales~~house ~~representatives,~~ware ~~including~~table ~~advertising~~ and ~~sales~~party ware ~~materials~~groups.

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Governmental Regulation

~~With the exception of the environmental laws noted below, we~~ We are unaware of and do not anticipate having to expend significant resources to comply with any non-environmental governmental regulations ~~of the recycling industry~~. We are subject to ~~the~~applicable laws and regulations ~~of those jurisdictions~~ in ~~which~~the jurisdictions where we ~~plan~~will to sell our ~~product~~products, which are generally ~~applicable~~ applicable to business operations, such as business licensing requirements, income taxes and payroll taxes. In general, the collection, recycling, and sale of polystyrene in the United States isare not subject to special non-environmentally related regulatory and/or supervisory requirements.

Compliance with Environmental Laws

~~The~~ Our business ~~may be~~ is subject, ~~in certain instances,~~ to supervision and regulation by state and federal governmental environmental authorities, ~~specifically~~ including the U.S. Environmental Protection Agency (“EPA”) and state counterparts. We will comply with all EPA and other requirements, ~~for~~including ~~receiving~~those ~~and~~pertaining ~~mixing chemicals and intend~~ to ~~comply~~receiving ~~with~~and ~~all~~mixing ~~future regulations and requirements~~chemicals.

Critical Accounting Policies

Our significant accounting policies are described in Note 1 of the Financial Statements.

Results of Operations for the ~~Three~~Six Months Ended ~~June~~September 30, 2009, 2008 ~~and the Period from February 5, 2008 (Date of Inception) until June 30, 2009~~

Revenue of $23,900, $10,234, and $55,767 was generated for the three months ended June 30, 2009, 2008, and the period from February 5, 2008 (Date of Inception) to June 30, 2009, respectively. Sales in the three months ended June 30, 2009 were primarily generated by sales of pellets, densified logs, and transportation charges. Other salesWe ~~were~~acquired ~~from~~American ~~sales~~Marketing ofon ~~our~~July ~~non-recycling related products, primarily Dumpster Ease. Cost of Sales for the same time periods were $91,193, $~~1,~~343~~ and $156,184, respectively. The Company incurred negative Gross Profit due to the low volume of production during this start up period together with high fixed costs. Negative Gross Profits should shrink as the Company increases production levels without a proportionate increase in costs but will increase further should expenses increase or revenue decrease. Operating Expenses were $476,532, $159,215 and $3,246,599 for the three months ended June 30, 2009, ~~2008,~~which ~~and~~accounts the period from February 5, 2008 (Date of Inception) to June 30, 2009 respectively. For each period, Operating Expenses consisted entirely of Depreciation, and General and Administrative Expenses partially offset by other income (expenses) consisting primarily of interest income of $67,354, $0 and $292,207, respectively. Operating Expenses for the ~~period from February 5, 2008 (Date of Inception) until June 30, 2009 included~~increases ~~$985,936~~noted ~~for the fair value of warrants granted to consultants~~below.

~~The~~We ~~Company~~had revenues ~~recorded a net loss~~ of $~~511~~2,~~723~~020,995 ~~$150,324~~ and $314,~~142,147~~516 for the six ~~three~~month periods ~~months~~ending ~~ended~~September ~~June~~ 30, 2009, and 2008, ~~and the period from February 5~~respectively, ~~2008~~representing ~~(Date~~an increase of ~~Inception) until June 30~~$2, ~~2009~~006, ~~respectively~~479. ~~Excluding~~Sales for the ~~fair~~six ~~value~~months ofended ~~the~~September ~~warrants~~30, 2009 ~~granted~~were toprimarily ~~consultants,~~generated ~~the~~from ~~loss~~our newly ~~would~~acquired ~~have~~company, American ~~been~~Marketing. We $2sold pellets,~~156,211~~ ~~for~~densified ~~the~~logs, ~~period~~and transportation ~~from~~charges; other ~~February 5,~~sales ~~2008~~were ~~(Date~~from sales of ~~Inception)~~our non-recycling ~~until~~related ~~June 30~~products, ~~2009~~primarily ~~respectively~~Dumpster Ease.

We anticipate our operating expenses will increase as we undertake our plan of operations. The increase will be attributable to the continued development of our Products and Services, and the professional fees associated with our being a reporting company under the Securities Exchange Act of 1934.5

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Costs of Sales for the same comparable periods were $1,828,769 and $3,935, representing an increase of $1,824,834. This increase is primarily attributable to American Marketing’s costs associated with its sales. American Marketing contributes a positive gross margin while Blue Earth Solutions Florida (“BES Florida”, a wholly owned subsidiary of the Company) is producing a negative gross margin (costs exceed revenue).

We are attempting to lower our operating costs. Operating Expenses were $1,531,037 and $607,979 for the six month periods ending September 30, 2009 and 2008, respectively, representing an increase of $923,058. This increase is attributable to the increased expenses we have assumed from American Marketing’s operations. For each period, Operating Expenses consists of Depreciation, and General and Administrative Expenses.

Other Income (Expenses) was $(248,014) of expense and income of $34,635 , representing an expense increase of $282,649 in the six months ended September 30, 2009 compared to the six months ended September 30, 2008. This was primarily attributable to accrued interest expense on the assumed note we acquired as part of the American Marketing acquisition.

We recorded a net loss of $1,606,642 and $562,763 for the six months ended September 30, 2009 and 2008, respectively. The loss in 2009 is primarily attributable to our overall six (6) months of activities, whereas American Marketing as our wholly owned subsidiary has conducted operations for only three months.

We anticipate our operating expenses will increase as we undertake our plan of operations. The increase will be attributable to the continued development of our products and services and professional fees associated with our being a Securities and Exchange Commission reporting company..

Results of Operations for the Three Months Ended September 30, 2009, 2008

We generated revenue of $1,997,095 and $4,282 for the three months ended September 30, 2009 and September 30, 2008, respectively, representing a $1,992,813 increase. Revenues in the three months ended September 30, 2009 were primarily generated from our newly acquired company, American Marketing. BES Florida sold pellets, densified logs, transportation charges, and non-recycling related products, primarily Dumpster Ease.

Cost of Sales for the same three (3) month comparable time periods are $1,737,576 and $2,592, an increase of $1,734,984. The Cost of Sales is primarily attributable to American Marketing’s costs associated with their sales. The Gross Profit for the three months ended September 30, 2009 and 2008 was $259,519 and $1,690, respectively, representing a $257,829 increase. This profit increase is attributable to American Marketing’s operations. Blue Earth Solutions Florida continues to attempt to lower its costs.

Operating Expenses were $1,054,505 and $448764 for the three months ended September 30, 2009 and 2008, respectively, representing a $605,741 increase, which is attributable to the increased expenses from American Marketing’s operations. For each period, Operating Expenses consisted of Depreciation, and General and Administrative Expenses. Other Income (Expenses) was $280,116 of expense and $34,635 of income for the three months ended September 30, 2009, representing an increase of $314,751 over the earlier September 30, 2008 three month period. This increase is primarily attributable to accrued interest expense on the assumed note we acquired as part of the American Marketing acquisition.

We recorded a net loss of $1,075,102 and $412,439 for the three months ended September 30, 2009 and 2008, respectively, representing an increased loss of $662,663. This loss is primarily attributable to BES Florida. We anticipate our operating expenses will increase as we undertake our plan of operations, which will be primarily attributable to the continued development of our products and services and the professional fees associated with our being a Securities and Exchange Commission reporting company.

Liquidity and Capital Resources

As of September ~~June~~ 30, 2009, ~~the~~we have ~~Company had~~ a working capital deficit of $27,~~382~~117,~~166~~ 038, which ~~was~~is composed of $~~299~~1,~~984~~689,971 in current assets less $28,~~682~~807,~~150~~009 of current liabilities.

Operating activities used $159,965, $197,712 and $9,568,080 in cash for the three months ended June 30, 2009, 2008, and from February 5, 2008 (Date of Inception) until June 30, 2009, respectively. The primary uses in Operating Activities were net losses of $511,723, $150,324 and $3,142,147 respectively and increases in Depository Accounts ~~of $67,001, $-, and $8,273,991, respectively. Investing~~ activities used $3,249, $115,320, and $5,742,089 in cash for the three months ended June 30, 2009, 2008, and for the period from February 5, 2008 (Date of Inception) until June 30, 2009, respectively. Funds were used to purchase property and equipment. Financing Activities generated $112,519, $440,000 and $15,310,169 in cash for the three months ended June 30, 2009, 2008, and for the period from February 5, 2008 (Date of Inception) until June 30, 2009 respectively.:

On· ~~August 29, 2008, the Company completed and closed a private offering of newly-created Series C Preferred Stock at an offering price of~~ $12,~~000 per share in a private placement. The Company sold a total of 14~~409,~~130~~259 ~~shares for total gross proceeds of $14,130,000, including $13,430,000 in cash~~ and ~~the cancelation of the~~ $~~700,000 promissory note (see Form 8K filed August 13, 2008). Of the proceeds, $~~8,~~500,000 was deposited in a fund in an offshore account~~056.802 ~~Upon~~for ~~deposit, we signed an agreement (~~the ~~“Agreement”)~~six ~~governing~~months ~~the~~ended ~~Funds,~~September ~~which was not countersigned by the fund administrator. As a result~~30, ~~there~~2009 ~~remains a dispute as to the control~~ and ~~dispositions~~2008 ~~of the Funds which management is currently exploring~~respectively. The Agreement details the investment return that the Company will earn on the Funds. Additionally, pursuant to the Agreement, the Company agreed to wait to withdraw $8,000,000 of the Funds until one of several stated conditions were met. The Company was and is entitled to withdraw the earnings, less the investment fees, generated by the Funds without restriction.

o The ~~Funds~~primary ~~were~~uses ~~classified as a current asset at March 31, 2009 because they were considered by management to be a liquid asset. During the quarter ended March 31, 2009, the Company was unsuccessful issuing bonds~~ in aOperating ~~depressed~~Activities bond market, which put a strain on the Company to meet its operating expenses. During the quarter ended June 30, 2009, the Company attempted to withdraw some of the Funds, but met resistance from the fund management with respect to the release of the Funds. The Company is taking steps to get the Funds released. In the interim, the Company is re-classifying the Funds as a non-current asset until such time that the Funds are released.were:

As§ ofNet ~~June~~losses ~~30, 2009, we had no cash. The success~~ of ~~our business plan is contingent upon us obtaining additional financing and establishing a consistent source of revenues. We intend to fund operations through debt and/or equity financing arrangements~~$1, ~~which may be insufficient to fund our capital expenditures~~606,642 ~~working~~and ~~capital~~$562, or other cash requirements. We do not have any formal commitments or arrangements for the sales of stock or the advancement or loan of funds at this time. There can be no assurance that such additional financing will be available to us on acceptable terms763, ~~or at all. If our attempts to raise additional capital are not successful, then implementation of our business plan may be delayed.~~respectively

~~Off~~§ ~~Balance~~Unrealized ~~Sheet~~loss ~~Arrangements~~of $1,450,000

As§ ofA ~~June~~decrease ~~30,~~in ~~2009,~~Accounts ~~there~~Receivable ~~were~~of no$233,976 ~~off~~and ~~balance~~an ~~sheet~~increase ~~arrangements.~~of $1,503, respectively

§ Depository Accounts increased $27,342 and $8,538,958, respectively

Investing activities provided;

·	$1,484,356 and $3,710,646 for the six months ended September 30, 2009 and 2008, respectively

o	The primary uses in Investing of Activities were:

§	Assumption of notes $5,229,114, offset by;

·	Investment in AMS $2,111,000

·	Goodwill of $329,514

·	Investment in securities of $800,000

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Financing Activities provided:

§	$408,133 and $14,390,000 for the six months ended September 30, 2009 and 2008, respectively.

On August 29, 2008, we completed and closed a private offering of newly-created Series C Preferred Stock at an offering price of $1,000 per share.. We sold 14,130 shares for total gross proceeds of $14,130,000, including $13,430,000 in cash and the cancelation of the $700,000 promissory note that we disclosed in our Form 8K filed with the Securities and Exchange Commission on August 13, 2008. From the $14,130,000 total gross proceeds, $8,500,000 was deposited in an offshore fund account that details an investment return to be earned upon the funds. As a result, there remains a dispute about the control and dispositions of these funds, which management is currently investigating. Additionally, the Agreement provides that we agree to wait to withdraw $8,000,000 of the funds until one of several stated conditions are met. We are entitled to withdraw the earnings, less the investment fees, generated by these funds without restriction. During the quarter ended September 30, 2009, we attempted to withdraw some of the funds, but the fund management refused to release them. We are taking steps to get these funds released and negotiations to sell the fund and its related dividend debts are ongoing, although there is no assurance whatsoever that we will be successful in that proposed sale. These funds were classified as a current asset at March 31, 2009 because management considered them to be a liquid asset. We have re-classified the funds as a non-current asset until such time that they are released, if ever. Should we encounter any of the following pertaining to the above-described investment, our financial condition will be negatively affected: (a) difficulties pertaining to the control and disposition of those funds; (b) incurring substantial losses from the investment of the funds; (c) the fund administrator refusing to return our funds; (d) incurring substantial litigation costs associated with litigating a matter in an overseas jurisdiction; and (e) difficulties associated with litigating and enforcing claims in a foreign jurisdiction..

During the quarter ended March 31, 2009, we attempted to issue bonds, the proceeds of which we were going to use for expansion purposes; however, the bond market collapsed and we were unable to successfully sell these bonds, which put a strain on our ability to meet our working capital and halted our expansion plans.

As of September 30, 2009, we had minimal cash resource. Our continued operations and possible future success is contingent upon our obtaining additional financing and establishing a consistent source of revenues. We intend to fund operations through debt and/or equity financing arrangements, which may be insufficient to fund our capital expenditures, working capital, or other cash requirements. We do not have any formal commitments or arrangements for the sales of stock or the advancement or loan of funds at this time. There can be no assurance that such additional financing will be available to us on acceptable terms, or at all. If our attempts to raise additional capital are unsuccessful, then implementation of our business plan may be delayed.

Off Balance Sheet Arrangements

As of September 30, 2009, there were no off balance sheet arrangements.

Going Concern

Our financial statements are prepared using generally accepted accounting principles applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. We have limited revenues and have generated losses from operations.

In order to continue as a going concern and achieve a profitable level of operations, we will need, among other things, additional capital resources and to develop a consistent source of revenues. Management’s plans include developing and marketing a practical, economical and environmentally safe means of disposing of and recycling certain polystyrene and expended polystyrene products.

Our auditors have indicated that our ability to continue as a going concern is dependent upon our ability to successfully accomplish the plan described in the preceding paragraph and eventually attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if we are unable to continue as a going concern.

Item 4T. Controls and Procedures

We carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of ~~June~~September 30, 2009. This evaluation was carried out under the supervision and with the participation of our Chief Executive Officer, Patricia Cohen, and our Chief Financial Officer, Paul Slusarczyk. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of ~~June~~September 30, 2009, our disclosure controls and procedures are not effective. ~~There~~ Do to expansion and lack of sufficient personnel certain controls and procedures have not been noadequate and ~~changes~~we inhave taken immediate action to rectify the matter. We have hired one new person in our ~~internal~~accounting ~~controls~~department ~~over~~so ~~financial~~that ~~reporting~~we ~~during~~can have the ~~quarter~~checks ~~ended~~and ~~June~~balances ~~30,~~necessary ~~2009~~to provide adequate control procedures.

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act are recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

Limitations on the Effectiveness of Internal Controls

Our management does not expect that our disclosure controls and procedures or our internal control over financial reporting will necessarily prevent all fraud and material error. Our disclosure controls and procedures are designed to provide reasonable assurance of achieving our objectives and our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are effective at that reasonable assurance level. 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 control issues and instances of fraud, if any, ~~within the Company~~ have been detected. These inherent ~~limitations~~ limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the internal control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, control may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate.

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PART II – OTHER INFORMATION

Item 1. Legal Proceedings

Except as described below, we are not a party to any pending legal proceeding, nor are we aware of any pending legal proceeding to which any of our officers, directors, or any beneficial holders of 5% or more of our voting securities are adverse to us or have a material interest adverse to us.

Katz and Iovino v. Blue Earth Solutions, Inc.

On December 22, 2008, ~~the~~we ~~Company~~ filed an action in the Eighth Judicial District Court in and for Clark County, Nevada, at(Case ~~case~~ no. 08-A-578406-B,) against several persons, including a former director and 5% shareholder, Harvey Katz, and former employee Claudia Iovino, Iovino’s husband, a shareholder Caicedo Resources LLC, and ~~brokerage~~ brokerage firms Glendale Securities, Citigroup Global Markets, Smith Barney, and Penson Financial Services. Our complaint alleged multiple causes of action arising out of the conversion of ~~the Company’s~~ our Series A Preferred Stock by Harvey Katz and Claudia Iovino into common stock in or about October 2008, and the ~~subsequent~~ later public resale by Katz, Iovino, and Caicedo of some of those shares and / or other common stock held by the defendants. The ~~gravamen of the Company’s~~ complaint ~~was~~ alleges that the shares of common stock held by the Defendants, including the shares resulting from the conversion of the Series A Preferred Stock, could not be publicly resold by the Defendants. ~~The Company’s~~ Our complaint ~~sought~~ seeks both damages and injunctive relief. ~~The Company~~ We moved for both a temporary restraining order and a preliminary injunction enjoining further sales of the securities and freezing the proceeds of all sales consummated thus far.

On December 22, 2008, the court issued a temporary restraining order which, ~~inter~~among other ~~alia~~things, barred further sales of those shares by all defendants and temporarily freezing all proceeds of sales already consummated. Defendants Katz and Iovino responded and objected to the ~~TRO~~ TRO and any preliminary injunction on several grounds, including that SEC Rule 144 permitted the public resale of the securities in question. ~~After the end of the reporting period, on~~ On January 12, 2008, the court held a hearing on ~~the Company’s motion for a~~ our preliminary injunction motion. On January 16, 2009, the court entered a preliminary injunction which, ~~inter~~among ~~alia~~other things, enjoined any further sale of the securities until the earlier of a full trial on the merits or May 20, 2009, but returned the proceeds of prior sales of the securities at issue to the defendants.

Defendants Katz and Iovino filed an Answer and Counterclaim on January 29, 2009, an Answer and Amended Counterclaim on February 9, 2009 and a Second Amended Counterclaim on March 17, 2009 seeking unspecified damages. The ~~parties~~defendants ~~are~~have not ~~now~~appeared ~~engaged~~at incourt ~~discovery,~~dates ~~which~~and isas ~~scheduled~~far toas ~~end~~we onknow ~~November~~do ~~29,~~not ~~2009. No~~have ~~trial~~council ~~date~~representing ~~has yet been set~~them. ~~The~~ ~~Company~~We ~~continues~~continue to vigorously prosecute ~~its~~ our claims and defend against Katz and Iovino’s counterclaims.

Food Control Solutions, Inc. v. Blue Earth Solutions, Inc.

On July 9, 2009, Food Control Solutions, Inc. (“Food Control”) filed an action against us for a breach of contract against us regarding the fabrication, installation, and start up of our Polystyrene Processing Plant. This action was filed in the Circuit Court of the Fifth Judicial Court in Lake County, Florida. Food isControl ~~seeking~~and sought damages of $86,549 plus interest of of $50,320. On October 29, 2009, we settled the action with Food Control and gave them some of the assets that were purchased in return for the payables that were still owed to them. We ~~are~~have reserved ~~contesting~~a ~~their~~loss for ~~claim~~this transaction of $132,314 at September 30, 2009. ~~The~~There ~~case~~are issome ~~currently~~assets left inpertaining ~~discovery~~to ~~stages~~this transaction that we are attempting to sell to help offset some of this loss.

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

~~During~~We issued 1,000,000 shares of our common stock to Datameg Corporation, a Delaware corporation (“Datameg”), in exchange for our receipt of all of the ~~three~~American ~~month~~Marketing’s ~~period~~issued ~~ended~~and ~~June~~outstanding 30stock, ~~2009~~a then subsidiary of Datameg. In the acquisition, we ~~engaged~~also assumed a promissory note in the amount of $5,450,000 between American Marketing and Datameg’s former shareholders stemming from Datameg’s purchase of American Marketing. In exchange for the note assignment to us, , we issued various share amounts totaling 400,000 shares to the following note holders:

After the close of business on June 30, 2009, the Company issued 1,400,000 shares of common to Datameg Corporation, a Delaware corporation (“Datameg”). In exchange for the shares the Company received all of the issued and outstanding stock of American Marketing & Sales, a Massachusetts corporation, (“American”) which was a subsidiary of Datameg.

a.	Lynel J. Tocci	100, 000 shares
b.	\Leanne J. Whitney	100,000 shares

In purchasing American, we also assumed a promissory note between the former shareholders of American and Datameg stemming from Datameg’s purchase of American. In consideration for the holders of the promissory note 1) allowing the note to be assigned to us and 2) extending the terms of the note by one year, we issued the following number of shares of our common stock stock to the following holders of the note:

c.	Linnea J. Clary	100,000 shares
d.	John Roncone, Sr	20,000 shares

a. Lynel J. Tocci 100, 000 shares

b. Leanne J. Whitney 100,000 shares

c. Linnea J. Clary 100,000 shares

d. John Roncone, Sr 20,000 shares

Leonard J. Tocci

80,000 shares

~~The~~We ~~shares~~ issued the toabove ~~these~~shares ~~parties were issued~~ in reliance upon the exemption from registration provided by Securities Act Section 4(2) ~~of the Securities Act~~. These provisions exempt transactions by an issuer not involving any public offering.

~~Item 3. Defaults upon Senior Securities~~8

JEC Family LP, loaned a total of $498,119 to us between August 2008 and June 2009. The loan is accruing interest at 8% annually. The loan is collateralized by the building the Company owns at 13511 Granville Ave, Clermont, FL 34711. As of June 30, 2009, the accrued interest on the loans is $14,414.

There have not been any payments of interest or principal on the loaned monies. As of June 30, 2009 we are delinquent in making interest payments in the amount that if $5,751. Additionally, as of June 30, 2009, we could owe $500 of late fee penalties as a result of our failure to make the required interest payments. We were obligated to begin making interest payments on May 15, 2009 and are obligated to make a payment of the interest due and owing on the 15th of every month thereafter until April 15, 2011 when the remaining principle and interest on the note comes due.

As a result of our failure to make interest payments, we are technically in default under the terms of the note. However, we have not been declared in default by the note’s holder. A $250 late fee is incurred for payments due and owing but not made within 10 days of the due date. Additionally, failure to make a payment due under the note results in all of the principal and interest outstanding becoming immediately due and owing. As of the date of this filing, the holder of the note has not assessed a late fee or demanded payment of all monies due and owing.

The General Partner of JEC Family LP is JEC Corp. James Cohen, Sr., is the President of JEC Corp., and the spouse of Patricia Cohen, our CEO, Secretary, Director as well as the father of James Cohen, Jr., our Vice President and Director.

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Item 3. Defaults upon Senior Securities

We have a related party loan with the General Partner of JEC Family LP, JEC Corp. James Cohen, Sr., is the President and , our Chief Executive Officer’s spouse as well as the father of James Cohen, Jr., our Vice President and Director. From August 2008 to September 2009, JEC Family LP loaned us $627,657, which accrues interest at 8% annually. The loan is collateralized by the building we own at 13511 Granville Ave, Clermont, Florida 34711. As of September 30, 2009, the accrued interest on the loan is $25,711, $21,677 of which represents delinquent payments. We have not made any interest or principal payments on the $627,657. Additionally, as of September 30, 2009, we may owe late fee penalties of $500 because we failed to make required interest payments. We are obligated to make interest and principle payments from May 15, 2009 until April 15, 2011. We are technically in default under the note terms, although we have received no default notice from the related party note holder.

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

No matters have been submitted to our security holders for a vote, through the solicitation of proxies or otherwise, during the quarterly period ended September ~~June~~ 30, 2009.

Item 5. Other Information

Purchase of American Marketing & Sales, Inc.

On March 17, 2009, we entered into a Stock Purchase Agreement (the “Agreement”) with Datameg Corporation, a Delaware corporation (“Datameg”) to purchase American Marketing ~~& Sales~~, ~~Inc.~~, a Massachusetts corporation (“AMS”) from Datameg~~. The~~ ~~closing~~providing offor the purchase of ~~AMS~~all ~~was contingent upon the satisfaction~~ of ~~conditions~~AMS’s ~~provided~~outstanding ~~for~~securities, inas ~~the Agreement.~~reported ~~This~~in our March ~~was~~31, ~~reported~~2009 onForm a8-K ~~Form~~filing 8kwith onthe ~~March~~Securities ~~31,~~and ~~2009~~Exchange Commission.

On June 24, 2009, ~~the~~ our Board of Directors consented to ~~the satisfaction of~~ satisfying all of our remaining obligations under the Agreement~~. As a result~~, ~~after the close of business~~ and on June 30, 2009, we completed the ~~purchase of~~ AMS ~~and~~purchase, it which is now our wholly-owned subsidiary. ~~This was previously reported on our Form 10-K for the year ending March 31, 2009.~~

Item 6. Exhibits

Exhibit Number	Description of Exhibit
31.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

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SIGNATURES

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

	Blue Earth Solutions, Inc.
Date:	~~August~~December 2124, 2009
	By: /s/ Patricia Cohen Patricia Cohen Title: Chief Executive Officer and Director
	By: /S/ Patricia Cohen Patricia Cohen Title: Chief Executive Officer and Director

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