Organization and Going Concern

Organization

ITonis Inc. (formerly Kenshou Inc.) (the "Company" or “ITonis”) was incorporated on July 5, 2005 as Kenshou Inc. under the laws of the State of Nevada. On December 2, 2005, the Company changed its name to ITonis Inc.

As a full service video solution and backend platform service provider, the Company has made a shift in overall corporate strategy to enter into the Chinese market. As a part of this strategy, the Company is no longer advancing funds to ITonis CZ s.r.o., the Company’s wholly owned subsidiary in the Czech Republic. On December 22, 2007, ITonis CZ s.r.o. declared bankruptcy and on January 15, 2008 the bankruptcy was registered in the Commercial Registrar of the Czech Republic.

On December 14, 2007, the Company entered into a binding, definitive joint cooperation agreement with Beijing Lushi (SDTV) Pilot Media Co., Ltd. (“Pilot Media”) to establish an online television network platform in the People’s Republic of China (“PRC”). Under the joint cooperation, Pilot Media is responsible for providing the television network platform, assembling the necessary licenses and permits and operational management of the joint cooperation and the Company is responsible for financing, business development and intellectual property.

On January 15, 2008 and as amended on March 5, 2008, the Company entered into a binding, definitive share purchase agreement with Niu Zhengping and Wu Jiping, individually for the acquisition of their company, Beijing Tuo Jiang Culture Development Ltd. Under the agreement, the Company must utilize a Chinese subsidiary to operate in the PRC. Consideration for the acquisition is 1,000,000 shares of the Company’s common stock and $610,000. The shares defined under this agreement were issued on January 22, 2008. On March 12, 2008, the Company paid $50,000 in partial payment.

On January 29, 2008, the Company issued 16,138,370 shares at $0.05 per share in a share purchase agreement with iOcean Media Limited (“iOcean”) and Aquos Media Limited (“Aquos”), under which 100% of the outstanding shares of Aquos were acquired for the purpose of conducting television over the Internet in the PRC. Prior to the acquisition, iOcean, on behalf of its wholly owned subsidiary, Aquos, entered into a letter of intent with Shangdong TV in August, 2007 for the contract rights to create a joint cooperation for a national online television (“IPTV”) platform in the PRC. With its acquisition of Aquos from iOcean, the Company assumed those rights to partially satisfy the obligation under the Company’s definitive Joint Cooperation Agreement with Shangdong's subsidiary, Pilot Media, entered into on December 14, 2007.

Going Concern and Liquidity Considerations

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the normal course of business. As at February 29, 2008, the Company has a working capital deficiency of $892,260 an accumulated deficit of $4,683,903 and has incurred an accumulated operating cash flow deficit of $1,215,477 since incorporation. The Company intends to continue funding operations through sales, debt, and equity financing arrangements, which may be insufficient to fund its capital expenditures, working capital and other cash requirements for the next fiscal year.

Organization and Going Concern - Continued

Going Concern and Liquidity Considerations - Continued

These factors, among others, raise substantial doubt about the Company's ability to continue as a going concern. The accompanying consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty except that the assets of ITonis CZ s.r.o. have been recorded at liquidation value resulting in a write down of assets totalling $76,234.

Thereafter, the Company will be required to seek additional funds, either through sales, debt, and/or equity financing, to finance its long-term operations. The successful outcome of future activities cannot be determined at this time, and there is no assurance that, if achieved, the Company will have sufficient funds to execute its intended business plan or generate positive operating results. In response to these conditions, management intends to raise additional funds through future debt agreement and private placement offerings.

Significant Accounting Policies

Basis of Consolidation

On January 4, 2006 the Company incorporated a wholly owned subsidiary in the Czech Republic named ITonis CZ s.r.o. (“ITonis CZ”) for the purposes of operating the Company’s development offices. On January 29, 2008, the Company acquired 100% of the outstanding shares of Aquos Media Limited for the purpose of conducting television over the Internet in the PRC. The primary asset is the contact rights that allow the Company to partially satisfy the obligation under the Company’s definitive Joint Cooperation Agreement with Pilot Media, These consolidated financial statements include the accounts of these companies since their respective incorporation and acquisition dates. All intercompany balances and transactions have been eliminated.

Basis of Presentation

The accompanying unaudited interim consolidated financial statements have been prepared as at February 28, 2008 and for the three month period then ended, in accordance with accounting principles generally accepted in the United States of America relating to the preparation of financial statements for interim periods. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three month period ended February 28, 2008 are not necessarily indicative of the results that may be expected for the year ending November 30, 2008.

These interim consolidated financial statements follow the same accounting policies and methods of their application as the most recent annual financial statements. These interim consolidated financial statements should be read in conjunction with the audited interim financial statements of the Company as at November 30, 2007.

Significant Accounting Policies - Continued

Recently Adopted Accounting Standards

In December 2007, the FASB issued SFAS No. 141 (Revised) “Business Combinations.” SFAS 141 (Revised) establishes principles and requirements for how the acquirer of a business recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree. The statement also provides guidance for recognizing and measuring the goodwill acquired in the business combination and determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination. The guidance will become effective for the fiscal year beginning after December 15, 2008. The Company has not yet evaluated the impact, if any, that SFAS 141R will have on its financial statements. Determination of the ultimate effect of this statement will depend on the Company’s structure at the date of adoption.

In December 2007, the FASB issued SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements”. This Statement amends ARB 51 to establish accounting and reporting standards for the noncontrolling (minority) interest in a subsidiary and for the deconsolidation of a subsidiary. It clarifies that a noncontrolling interest in a subsidiary is an ownership interest in the consolidated entity that should be reported as equity in the consolidated financial statements. The Company currently has no entities or arrangements that will be affected by the adoption of SFAS 160. However, determination of the ultimate effect of this pronouncement will depend on the Company’s structure at the date of adoption.

In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities” (SFAS 159). SFAS 159 allows the Company to choose to measure many financial assets and financial liabilities at fair value. Unrealized gains and losses on items for which the fair value option has been elected are reported in earnings. SFAS 159 is effective for fiscal years beginning after November 15, 2007. The Company is currently evaluating the requirements of SFAS 159 and the potential impact on the Company’s financial statements.

In September 2006, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements (“SAB 108”), which addresses how to quantify the effect of financial statement errors. The provisions of SAB 108 become effective as of the end of our 2007 fiscal year. The adoption of SAB 108 did not have a material effect on the Company's reported financial position or results of operations.

In September 2006, the FASB issued SFAS No. 157, "Fair Value Measurement" ("SFAS 157"). The Statement provides guidance for using fair value to measure assets and liabilities. The Statement also expands disclosures about the extent to which companies measure assets and liabilities at fair value, the information used to measure fair value, and the effect of fair value measurement on earnings. This Statement applies under other accounting pronouncements that require or permit fair value measurements. This Statement does not expand the use of fair value measurements in any new circumstances. Under this Statement, fair value refers to the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants in the market in which the entity transacts. SFAS 157 is effective for fiscal years beginning after November 15, 2007. The adoption of SFAS 157 is not expected to have a material impact on the Company’s financial position, results of operation or cash flows.

Significant Accounting Policies - Continued

Recently Adopted Accounting Standards - Continued

In June 2006, the FASB issued FIN. 48, “Accounting for Uncertainty in Income Taxes (an interpretation of FASB Statement No. 109)” (“FIN 48”), which is effective for fiscal years beginning after December 15, 2006. This interpretation was issued to clarify the accounting for uncertainty in income taxes recognized in the financial statements by prescribing a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The Company is currently evaluating the potential impact of FIN 48, but it is not expected to have a material impact on the Company’s financial position, results of operations or cash flows.

a)          Contract Rights Details are as follows:

Equipment

Details are as follows:

Software Costs

By agreement dated October 1, 2005, the Company acquired from an unrelated party (“Onyx”), the TV Everywhere Technology (“intellectual property”) by issuing 30,000,000 common shares. This resulted in Onyx owning approximately 64% of the Company. The value assigned to the 30,000,000 common shares was $447,637 being the historical cost to Onyx. This is in accordance with SAB Topic 5G as Onyx retained a substantial indirect interest in the technology as at the date of transfer. This amount was expensed, as it does not meet the criteria for capitalization as set out in SFAS No. 86.

Commitments

By agreement dated September 1, 2007, and amendment dated January 2, 2008, the Company entered into an amended three-year Employment Agreement with a director of the Company. In consideration the Company has agreed pay the director an annual salary of $300,000 and to issue to him an aggregate of 25,000,000 shares of our common stock in a combination of option grants and share grants. The option and share grants are to be issued pursuant to separate stock and option grant agreements that have not been executed as of February 29, 2008.

By agreement dated September 1, 2007, and amendment dated January 2, 2008, the Company entered into an amended three-year Employment Agreement with a director of the Company. In consideration the Company has agreed pay the director an annual salary of $200,000 and to issue to him an aggregate of 10,000,000 shares of our common stock in a combination of option grants and shares. The option and share grants are to be issued pursuant to separate stock and option grant agreements that have not been executed as of February 29, 2008.

On December 14, 2007, the Company entered into a binding, definitive joint cooperation agreement with Beijing Lushi (SDTV) Pilot Media Co., Ltd. (“Pilot Media”) to establish an online television network platform in China. Under the joint cooperation, Pilot Media is responsible for providing the television network platform, assembling the necessary licenses and permits and operational management of the joint cooperation and the Company is responsible for financing, business development and intellectual property. The Company is required to raise $15,000,000 by June 1, 2008, for the implementation of the internet television platform. The Company has operational control of the joint cooperation.  In the current period, the Company advanced $150,000 to the joint venture.

Commitments - Continued

On January 15, 2008 and as amended on March 5, 2008, the Company entered into a binding, definitive share purchase agreement with Niu Zhengping and Wu Jiping, individually for the acquisition of their company, Beijing Tuo Jiang Culture Development Ltd. (“Beijing”). Under the agreement, the Company must utilize a Chinese subsidiary to operate in the PRC. Consideration for the acquisition is 1,000,000 shares of the Company’s common stock and $610,000. The shares defined under this agreement were issued on January 22, 2008 at $0.05 per share. On January 25, 2008, Beijing advanced $150,000 on behalf of the Company to the Pilot Media joint venture (Note 5c).  The cash portion will be paid according to the following schedule:

Segmented Information

Details on a geographic basis as at February 29, 2008 are as follows:

Related Party Balances and Transactions

Related party transactions not disclosed elsewhere in these financial statements are as follows:

During the year ended November 30, 2005, the Company issued 250,000 founder shares to a former director of the Company for cash proceeds of $500.

On January 29, 2008, the Company issued 16,138,370 shares to iOcean in exchange for 100% of the shares outstanding of a company with a director in common, Aquos Media Limited, priced at fair market value, $0.05 per share.

The amount due to related parties comprises

$120,000 of non-interest bearing, due on demand accrued fees owing to a separate company that holds a significant interest in the Company.

$45,756 (860,800 CZK) loan from a former director and officer of the Company. The loan is evidenced by a promissory note, is unsecured and non-interest bearing and payable on demand.

$48,789 (808,058 CZK) of accrued salaries owed to former directors or officers of the Company.

During the period ended February 29, 2008, $Nil (February 29, 2007 - $11,263) was paid to two directors in salary.

During the period ended February 29, 2008, $120,167 (February 29, 2007 - $Nil) was paid to two directors for consulting fees.

These transactions were incurred in the normal course of operations and were measured at the exchange amount of consideration established and agreed to by the related parties.

Capital Stock

Effective June 15, 2006, the board of directors approved the consolidation of the Company’s issued and outstanding shares of common stock on the basis of one new share of common stock for each old two shares of common stock of the Company. Pursuant to SAB Topic 4c, all common share information presented in these financial statements is retroactively presented on a post-consolidation basis, including all share amounts and per share prices.

During the year ended November 30, 2006, the Company entered into a five-month investor relations consulting agreement with an unrelated party for consideration of $12,000 and 150,000 common shares, valued at $12,500.

During the year ended November 30, 2006, the Company negotiated a subscription agreement (signed December 12, 2006) with a private investor for the purchase of 1,200,000 shares at $0.083 per share, for total cash proceeds of $100,000 (received October 12, 2006).

On December 20, 2006, the Company negotiated a subscription agreement with a private investor for the purchase of 155,364 shares at $0.083 per share, for total cash proceeds of $12,947.

On January 12, 2007, the Company negotiated a subscription agreement with a private investor for the purchase of 1,200,000 shares at $0.083 per share for total cash proceeds of $100,000.

On February 1, 2007, the Company entered into a consulting agreement with Westport Strategic Partners Inc. to provide investor and public relations services for a total consideration of $100,000 plus the issuance of 600,000 common shares at $0.083 per share. (Note 8o).

On March 8, 2007, the board of directors approved the consolidation of the Company’s issued and outstanding shares of common stock on the basis of three new shares of common stock for one share of old common stock of the Company. Pursuant to SAB Topic 4c, all common share information presented in these financial statements is retroactively presented on a post- consolidation basis, including all share amounts and per share prices.

On April 11, 2007, the Company negotiated a subscription agreement with a private investor for the purchase of 438,208 shares at $0.075 per share for total cash proceeds of $32,866.

On May 18, 2007, the Company negotiated a subscription agreement with a private investor for the purchase of 936,300 shares at $0.050 per share for total cash proceeds of $46,815.

On June 11, 2007, the Company issued for cash 1,000,000 restricted units comprised of 1,000,000 shares at $0.25 and 1,000,000 share purchase warrants exercisable at $0.25 expiring on June 11, 2009.

In November, 2007, the Company received cash proceeds of $62,500 for a share subscription of 1,250,000 restricted units comprised of 1,250,000 shares at $0.05 and 1,250,000 share purchase warrants exercisable at $0.05 expiring on November 30, 2009. These shares and warrants have not been issued and as such are shown in share subscriptions received.

On January 29, 2008, the Company issued 16,138,370 shares to iOcean Media Limited in exchange for 100% of the shares outstanding of a company with a director in common, Aquos Media Limited. The shares are priced at fair market value, $0.05 per share.

On January 31, 2008, the Company issued 2,500,000 shares at a price of $0.05 per share for total cash proceeds of $125,000 in a private placement subscription with Karada Ltd.

Capital Stock - Continued

On January 31, 2008, the Company issued to Karada Ltd. 4,000,000 common shares at $0.05 per share as full consideration for investor services rendered.

On February 5, 2008, the Company issued 1,000,000 shares to Westport Strategic Partners Inc. in satisfaction of a $100,000 liability due on November 30, 2007 (Note 8f).

On February 11, 2008, the Company issued shares to a private investor for the purchase of 12,500,000 shares at $0.02 per share for total cash proceeds of $250,000.

On February 14, 2008, the Company issued shares to a private investor for the purchase of 880,000 shares at $0.25 per share for total cash proceeds of $220,000.

Share Purchase Options

The Company has established a share purchase option plan whereby the board of directors may, from time to time, grant options to directors, officers, employees or consultants. Options granted must be exercised no later than ten years from the date of grant or such lesser period as determined by the Company’s board of directors, and are subject to vesting provisions unless the directors of the Company determine otherwise. The exercise price of an option is equal to or greater than 85% of the fair market value of the common stock on the grant date.

On June 16, 2006, the Company granted employees of the Company options to purchase up to 1,500,000 common shares of the Company at an exercise price of $0.267 per share on or before June 16, 2009. These options have an estimated value of $30,875 on the grant date.

On December 29, 2006, the Company granted employees of the Company options to purchase up to 1,500,000 common shares of the Company at an exercise price of $0.267 per share on or before June 16, 2009. These options had an estimated value of $20,714 on the grant date.

Capital Stock - Continued

Share Purchase Options - Continued

The following is a summary of option activities during the periods ended February 29, 2008 and November 30, 2007:

Capital Stock - Continued

Share Purchase Warrants

The following is a summary of warrant activities during the periods ended February 29, 2008 and November 30, 2007:

Subsequent Events

On March 12, 2008, the Company paid $50,000 in partial payment for the acquisition of Beijing Tuo Jiang Culture Development Ltd. (Note 5d).

On March 24, 2008, the Company issued shares to a private investor for the purchase of 12,500,000 shares at $0.02 per share for total cash proceeds of $250,000.

On March 26, 2008, the Company issued 50,000 shares to Pacific Wave Partners Limited for finder’s fees.