10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 10-Q

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

For the quarterly period ended September 30, 2008

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

Commission file number 000-30853

INTERNATIONAL MONETARY, LTD.

(Exact name of Registrant as specified in its charter)

Wisconsin	39-1924096
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
16901 West Glendale Drive, New Berlin, Wisconsin 53151
(Address of principal executive offices)
(262) 780-3640
(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant has (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes o  No ý

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.  (Check One):

Large Accelerated Filer  o	Accelerated Filer  o	Non-Accelerated Filer  o	Smaller Reporting Company  T
		(Do not check if a smaller reporting company)

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

The number of shares of Common Stock, $.0001 par value, outstanding as of November 10, 2008 was 61,175,436.

TABLE OF CONTENTS

INTERNATIONAL MONETARY SYSTEMS, LTD.

			Page No.
Part I.	FINANCIAL INFORMATION
Item 1 -	Financial Statements (September 30, 2008 - Unaudited)
		Condensed Consolidated Balance Sheets – September 30, 2008 and December 31, 2007	2
		Condensed Consolidated Statements of Operations – Three  Months Ended September 30, 2008 and 2007; Nine Months Ended September 30, 2008 and 2007	4
		Condensed Consolidated Statements of Cash Flows - Nine Months Ended September 30, 2008 and 2007	5
		Condensed Consolidated Statement of Changes in Stockholders Equity  - Nine Months Ended September 30, 2008	7
		Notes to Condensed Consolidated Financial Statements	8
Item 2 -	Management’s Discussion and Analysis of Financial Condition and Results of Operations		16
Item 3 -	Quantitative and Qualitative Disclosures about Market Risk		20
Item 4 -	Controls and Procedures		20
Part II.	Other Information		21
Item 1A -	Risk Factors
Item 2 -	Unregistered Sales of Equity Securities and Use of Proceeds
Item 3 -	Defaults on Upon Senior Securities
Item 4 -	Submission of Matters to a Vote of Security Holders
Item 6 -	Exhibits

1

INTERNATIONAL MONETARY SYSTEMS, LTD.

CONDENSED CONSOLIDATED BALANCE SHEETS

	September 30, 2008		December 31, 2007
	(UNAUDITED)		(RESTATED)
ASSETS
Current assets
Cash	$	408,221	$	812,365
Restricted cash		675,291		483,443
Marketable securities		103,986		118,380
Accounts receivable, net		1,250,874		1,516,938
Earned trade account		609,193		314,928
Prepaid expenses		177,410		112,233
Inventory		33,839		33,839
Total current assets		3,258,814		3,392,126
Net furniture and equipment		1,113,516		1,269,263
Other assets
Membership lists, net		10,128,999		9,962,154
Goodwill		3,435,479		3,435,479
Covenant not to compete, net		-		14,883
Purchase option		-		112,500
Assets held for investment		99,298		99,298
Investment in real estate		26,000		28,695
Cash surrender value		41,256		37,056
Total other assets		13,731,032		13,690,065
Total assets	$	18,103,362	$	18,351,454

2

INTERNATIONAL MONETARY SYSTEMS, LTD.

CONDENSED CONSOLIDATED BALANCE SHEETS

	September 30, 2008			December 31, 2007
	(UNAUDITED)			(RESTATED)
LIABILITIES
Current liabilities
Accounts payable and accrued expenses	$	822,522		$	1,002,732
Current portion of notes payable		1,289,583			1,980,737
Current portion of common stock
subject to guarantee		1,287,000			995,000
Total current liabilities		3,399,105			3,978,469
Long-term liabilities
Notes payable net, less current portion		1,735,849			716,037
Common stock subject to guarantee, less current portion		1,541,000			1,890,000
Deferred compensation		147,250			136,000
Deferred income taxes		2,250,000			2,550,000
Total long-term liabilities		5,674,099			5,292,037
Total liabilities		9,073,204			9,270,506
STOCKHOLDER EQUITY
Preferred stock, $.0001 par value
20,000,000 authorized, 0 outstanding		-			-
Common stock, $.0001 par value 280,000,000
authorized, 61,425,436 and 60,565,436
issued and outstanding September 30, 2008
and December 31, 2007 respectively		6,143			6,057
Paid in capital		11,467,358			10,901,944
Treasury stock, 1,505,875 and 1,276,542
shares outstanding, respectively		(719,241	)		(547,241	)
Subscription receivable		(27,477	)		(31,196	)
Accumulated other comprehensive gain		(16,083	)		15,310
Accumulated deficit		(1,680,542	)		(1,263,926	)
Total stockholder equity		9,030,158			9,080,948
Total liabilities and
stockholder equity	$	18,103,362		$	18,351,454

See accompanying notes to condensed consolidated financial statements.

3

INTERNATIONAL MONETARY SYSTEMS, LTD.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATION (UNAUDITED)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2008			2007			2008			2007
Gross revenue	$	3,537,840		$	3,563,578		$	10,596,113		$	10,285,250
Expenses
Payroll, related taxes
and employee benefits		2,188,512			2,341,223			7,091,202			6,689,952
General and administrative		430,201			547,483			1,390,898			1,504,612
Occupancy		272,923			236,535			793,061			711,678
Selling		270,149			167,858			526,712			509,639
Depreciation		75,389			68,308			222,192			180,228
Amortization		342,143			303,462			1,002,961			898,378
Provision for bad debt		(68,263	)		51,271			12,590			78,839
Total expenses		3,511,054			3,716,140			11,039,616			10,573,326
Net income (loss) from operations		26,786			(152,562	)		(443,503	)		(288,076	)
Other income (expense)
Interest income		2,099			10,323			9,654			36,765
Interest expense		(74,119	)		(73,060	)		(202,485	)		(271,426	)
Total other income (expense)		(72,020	)		(62,737	)		(192,831	)		(234,661	)
Loss before income taxes		(45,234	)		(215,299	)		(636,334	)		(522,737	)
Income tax expense (benefit)		76,282			(81,067	)		(219,718	)		(261,143	)
Net loss	$	(121,516	)	$	(134,232	)	$	(416,616	)	$	(261,594	)
Net loss per
common share - basic	$	(.00	)	$	(.00	)	$	(.01	)	$	(.00	)
- dilutive	$	(.00	)	$	(.00	)	$	(.01	)	$	(.00	)
Weighted average common
shares outstanding - basic		61,396,450			57,976,366			61,045,679			56,375,316
- dilutive		61,396,450			57,976,366			61,045,679			56,375,316

See accompanying notes to condensed consolidated financial statements.

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INTERNATIONAL MONETARY SYSTEMS, LTD.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

	Nine Months Ended September 30,
	2008			2007
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(416,616	)	$	(261,594	)
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation and amortization		1,225,153			1,078,606
Provision for bad debts		12,590			78,839
Stock issued for services		56,000			85,000
Loss on disposal of fixed assets		23,786			-
Accretion of discount on notes payable		4,723			32,077
Deferred compensation		11,250			11,250
Interest on subscription receivable		(1,281	)		-
Changes in assets and liabilities					-
Accounts receivable		284,475			219,827
Earned trade account		(344,265	)		(321,916	)
Prepaid expense		(65,177	)		126,385
Accounts payable		(90,284	)		44,114
Accrued compensation & payroll taxes		53,774			192,614
Accrued sales tax		(44,700	)		(34,705	)
Accrued income taxes		(99,000	)		17,000
Deferred income taxes (net of acquisition)		(300,000	)		(290,625	)
Net cash provided by operating activities		310,428			976,872
CASH FLOWS FROM INVESTING ACTIVITIES:
(Increase) decrease in restricted cash		(191,848	)		(361,886	)
Capital expenditures		(70,731	)		(747,135	)
Purchase of marketable securities		(6,750	)		(6,751	)
Proceeds from sale of real estate		2,695			-
Cash payments on business acquisitions		(495,000	)		488,452
Increase in cash surrender value		(4,200	)		(4,200	)
Net cash used in investing activities		(765,834	)		(631,520	)

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INTERNATIONAL MONETARY SYSTEMS, LTD.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

Continued

	Nine Months Ended September 30,
	2008			2007
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on notes payable to related parties		-			(110,024	)
Proceeds from line of credit and notes payable		620,000			-
Payments on notes payable		(693,989	)		(464,050	)
Purchase of treasury stock		(172,000	)		-
Proceeds from subscription receivable		5,000			8,299
Proceeds related to issuance of stock		302,500			421,500
Net cash provided by financing activities		61,511			(144,275	)
Foreign currency translation adjustment		(10,249	)		12,788
Net increase (decrease) in cash		(404,144	)		213,865
Cash at beginning of period		812,365			930,962
Cash at end of period	$	408,221		$	1,144,827
SUPPLEMENTAL DISCLOSURES
Cash paid for interest	$	194,297		$	261,463
Cash paid for income taxes	$	179,282		$	12,482
SCHEDULE OF NONCASH INVESTING AND
FINANCING ACTIVITIES:
Business acquisitions
Fair value of assets acquired	$	1,155,424		$	4,095,000
Less:  Liabilities assumed		-			(130,000	)
Stock issued		(150,000	)		(2,550,000	)
Deferred tax liability		-			(650,000	)
Purchase option		(112,500	)		-
Issuance of notes payable		(397,924	)		(755,000	)
Net cash paid for acquisitions	$	495,000		$	10,000
Release of stock guarantees	$	150,000		$	-
Stock guarantees on acquisitions	$	207,000		$	2,500,000
Payment of long term debt with stock	$	-		$	1,000,000

 See accompanying notes to condensed consolidated financial statements.

6

INTERNATIONAL MONETARY SYSTEMS, LTD.

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (UNAUDITED)

For the Nine Months Ended September 30, 2008

	Preferred Stock				Common Stock															Treasury Stock
																										Total
			Par				Par		Paid in		Sub.			Other			Accum.						Par			Stockholder
	Shares		Value		Shares		Value		Capital		Rec.			Income			Deficit			Shares			Value			Equity
Balances at
December 31, 2007		-		-		60,565,436	$	6,057	$	10,901,944	$	(31,196	)	$	15,310		$	(1,263,926	)		(1,276,542	)	$	(547,241	)	$	9,080,948
Foreign currency
translation adjustment		-		-		-		-		-		-			(10,249	)		-			-			-			(10,249	)
Unrealized loss on available
for sale securities		-		-		-		-		-		-			(21,144	)		-			-			-			(21,144	)
Net (loss) Nine Months
Ended September 30, 2008		-		-		-		-		-		-			-			(416,616	)		-			-			(416,616	)
Net comprehensive  (loss)		-		-		-		-		-		-			-			-			-			-			(448,009	)
Stock issued for services		-		-		110,000		11		55,989		-			-			-			-			-			56,000
Warrants exercised		-		-		550,00		55		302,445		-			-			-			-			-			302,500
Shares issued in
conjunction with the
acquisition of businesses		-		-		200,000		20		149,980		-			-			-			-			-			150,000
Guaranteed stock returned
for restricted cash		-		-		-		-		-		-			-			-			(229,333	)		(172,000	)		(172,000	)
Reclassification of shares
issued at guaranteed
prices to liabilities		-		-		-		-		57,000		-			-			-			-			-			57,000
Subscription receivable		-		-		-		-		-		3,719			-			-			-			-			3,719
Balance,
September 30, 2008		-		-		61,425,436	$	6,143	$	11,467,358	$	(27,477	)	$	( 16,083	)	$	(1,680,542	)		(1,505,875	)	$	(719,241	)	$	9,030,158

See accompanying notes to condensed consolidated financial statements.

7

INTERNATIONAL MONETARY SYSTEMS, LTD.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

September 30, 2008

NOTE 1 - BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of 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 nine month period ended September 30, 2008, are not necessarily indicative of the results that may be expected for the year ended December 31, 2008.

The balance sheet at December 31, 2007, has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.

For further information, refer to the consolidated financial statements and footnotes thereto included in the company's 10KSB/A for the year ended December 31, 2007 and filed on April 2, 2008.

Principles of Consolidation

The consolidated financial statements for 2008 and 2007 include the accounts of the Company and its wholly owned subsidiaries Continental Trade Exchange, Ltd., National Trade Association, Inc. and INLM Holdings, Inc. (from February 1, 2007). Significant intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Earnings Per Share

The computation of earnings per share of common stock is based on the weighted average number of shares outstanding at the date of the financial statements. The assumed exercise of 3,020,000 and 3,800,000 stock options and warrants as of September 30, 2008 and 2007 respectively is not included in the diluted loss per share as the effect is anti-dilutive.

Business Segments

The Company operates in one segment and therefore segment information is not presented.

Stock-Based Compensation

Effective January 1, 2006, the Company adopted Statement No. 123R, Share-Based Payment ("SFAS 123R"), which requires companies to measure and recognize compensation expense for all share-based payment awards made to employees and directors based on estimated fair values. SFAS 123R is being applied on the modified prospective basis. Prior to the adoption of SFAS 123R, the Company accounted for its stock-based compensation plans under the recognition and measurement principles of Accounting Principles Board (APB) Opinion No. 25, Accounting for Stock Issued to Employees, as provided by SFAS 123. Accounting for Stock based compensation ("SFAS 123") and accordingly, recognized no compensation expense related to the stock-based plans as stock options granted to employees

8

and directors were equal to the fair market value of the underlying stock at the date of grant. In March 2005, the SEC issued Staff Accounting Bulletin No. 107 ("SAB 107") relating to SFAS 123R. The Company has applied the provisions of SAB 107 in its adoption of SFAS 123R.

Common stock, stock options and common stock warrants issued to other than employees or directors are recorded on the basis of their fair value, as required by SFAS No. 123(R), which is measured as of the date required by EITF Issue 96-18, “Accounting for Equity Instruments That Are Issued to Other Than Employees for Acquiring, or in Conjunction with Selling, Goods or Services.” In accordance with EITF 96-18, the stock options or common stock warrants are valued using the Black-Scholes option pricing model on the basis of the market price of the underlying common stock on the “valuation date,” which for options and warrants related to contracts that have substantial disincentives to non-performance is the date of the contract, and for all other contracts is the vesting date. Expense related to the options and warrants is recognized on a straight-line basis over the shorter of the period over which services are to be received or the vesting period. Where expense must be recognized prior to a valuation date, the expense is computed under the Black-Scholes option pricing model on the basis of the market price of the underlying common stock at the end of the period, and any subsequent changes in the market price of the underlying common stock up through the valuation date is reflected in the expense recorded in the subsequent period in which that change occurs.

Foreign Currency Translation

The financial statements of the Company's foreign subsidiary have been translated into U.S. dollars in accordance with SFAS No. 52, Foreign Currency Translation (SFAS 52). All balance sheet accounts have been translated using the exchange rate in effect at the balance sheet date. Income statement amounts have been translated using an appropriately weighted average exchange rate for the year. The translation gains and losses resulting from the changes in exchange rates during 2008 have been reported in accumulated other comprehensive income, except for gains and losses resulting from the translation of intercompany receivables and payables, which are included in earnings for the period.

Recent Accounting Pronouncements

In December 2007, the Financial Accounting Standards Board (FASB) issued SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements – an amendment of ARB No. 51”. This statement improves the relevance, comparability, and transparency of the financial information that a reporting entity provides in its consolidated financial statements by establishing accounting and reporting standards that require: the ownership interests in subsidiaries held by parties other than the parent and the amount of consolidated net income attributable to the parent and to the noncontrolling interest be clearly identified and presented on the face of the consolidated statement of income; changes in a parent’s ownership interest while the parent retains its controlling financial interest in its subsidiary be accounted for consistently; when a subsidiary is deconsolidated, any retained noncontrolling equity investment in the former subsidiary be initially measured at fair value; entities provide sufficient disclosures that clearly identify and distinguish between the interests of the parent and the interests of the noncontrolling owners. SFAS No. 160 affects those entities that have an outstanding noncontrolling interest in one or more subsidiaries or that deconsolidate a subsidiary. SFAS No. 160 is effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2008. Early adoption is prohibited. The adoption of this statement is not expected to have a material effect on the Company's financial statements.

In March 2008, the FASB issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities, an amendment of FASB Statement No. 133” (SFAS 161). This statement is intended to improve transparency in financial reporting by requiring enhanced disclosures of an entity’s derivative instruments and hedging activities and their effects on the entity’s financial position, financial performance, and cash flows. SFAS 161 applies to all derivative instruments within the scope of SFAS 133, “Accounting for Derivative Instruments and Hedging Activities” (SFAS 133), as well as related hedged items, bifurcated derivatives, and nonderivative instruments that are designated and qualify as hedging instruments. Entities with instruments subject to SFAS 161 must provide more robust qualitative disclosures and expanded quantitative disclosures. SFAS 161 is effective prospectively for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, with early application permitted. We are currently evaluating the disclosure implications of this statement.

9

In May 2008, the FASB issued FASB Staff Position APB 14-1 (FSP APB 14-1), “Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement)”, which applies to all convertible debt instruments that have a “net settlement feature”, which means that such convertible debt instruments, by their terms, may be settled either wholly or partially in cash upon conversion. FSP APB 14-1 requires issuers of convertible debt instruments that may be settled wholly or partially in cash upon conversion to separately account for the liability and equity components in a manner reflective of the issuers’ nonconvertible debt borrowing rate. FSP APB 14-1 is effective for financial statements issued for fiscal years beginning after December 15, 2008 and interim periods within those fiscal years. Early adoption is not permitted and retroactive application to all periods presented is required. We continue to evaluate the application of FSP APB 14-1 on our financial statements.

In May 2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted Accounting Principles.” SFAS No. 162 identifies the sources of accounting principles and provides entities with a framework for selecting the principles used in preparation of financial statements that are presented in conformity with GAAP. The current GAAP hierarchy has been criticized because it is directed to the auditor rather than the entity, it is complex, and it ranks FASB Statements of Financial Accounting Concepts, which are subject to the same level of due process as FASB Statements of Financial Accounting Standards, below industry practices that are widely recognized as generally accepted but that are not subject to due process. The Board believes the GAAP hierarchy should be directed to entities because it is the entity (not its auditors) that is responsible for selecting accounting principles for financial statements that are presented in conformity with GAAP. SFAS 162 is effective 60 days following the SEC’s approval of PCAOB Auditing Standard No. 6, Evaluating Consistency of Financial Statements (AS/6). The adoption of FASB 162 is not expected to have a material impact on the Company’s financial position.

In May 2008, the FASB issued SFAS No. 163, “Accounting for Financial Guarantee Insurance Contracts-an interpretation of FASB Statement No. 60.” Diversity exists in practice in accounting for financial guarantee insurance contracts by insurance enterprises under FASB Statement No. 60, Accounting and Reporting by Insurance Enterprises. This results in inconsistencies in the recognition and measurement of claim liabilities. This Statement requires that an insurance enterprise recognize a claim liability prior to an event of default (insured event) when there is evidence that credit deterioration has occurred in an insured financial obligation. This Statement requires expanded disclosures about financial guarantee insurance contracts. The accounting and disclosure requirements of the Statement will improve the quality of information provided to users of financial statements.  SFAS 163 is effective for financial statements issued for fiscal years beginning after December 15, 2008, and interim periods within those fiscal years. The adoption of FASB 163 is not expected to have a material impact on the Company’s financial position.

Note 2 - CASH AND EQUIVALENTS

For purposes of the statement of cash flows, the Company considers all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents to the extent the funds are not being held for investment purposes. As of September 30, 2008, the Company has cash in excess of FDIC insurance of $597,954. On October 22, 2008, the FDIC insurance was increased to $250,000 from $100,000.

Note 3 - EARNED TRADE ACCOUNT

As part of the operations of the subsidiaries the Company earns trade dollars, which can be and are used to purchase goods and services. This account is increased principally for service, membership and transaction fees, and is decreased by the company's purchases of goods and services using trade dollars. An impairment loss is recognized if it becomes apparent that the fair value of the trade dollars in the account is less than the carrying amount, or if it is probable that the company will not use all of its trade dollars.

Note 4 - REVENUE SOURCES AND REVENUE RECOGNITION

The Company and its subsidiaries earn revenues in both traditional dollars (cash income) and in trade dollars. Cash income is earned primarily through fees assessed when a member joins, transaction fees generated when clients earn or spend their trade dollars, monthly maintenance fees, finance charges on delinquent accounts receivable, and event fees.

10

Trade revenue is similarly generated through initial membership fees, monthly maintenance fees, transaction fees and event fees. Occasionally the Company will accept a favorable trade ratio in lieu of a cash fee. The Company uses earned trade dollars to purchase various goods and services required in its operations. All barter transactions are reported at the estimated fair value of the products or services received.

Revenues are recognized when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the price is fixed or determinable, and collectability is reasonably assured.

Transaction fees are recognized upon receipt of transactional information accumulated by our systems or reported by our clients. Membership fees, monthly maintenance fees, finance charges, and other fees are billed monthly to members' accounts, and are recognized in the month the revenue is earned.

NOTE 5 - INVENTORY

Inventory consists primarily of jewelry and other merchandise held for sale by the Company. Inventory is carried at the lower of actual cost of acquisition, or fair value.

NOTE 6 – BUSINESS ACQUISITIONS

On April 4, 2008, IMS exercised its option to purchase specific assets from New York Commerce Group (NYCG) pursuant to an agreement from September 2006. The final purchase price was set at $405,424. IMS paid NYCG $100,000 on April 8, 2008. Payments made prior to this date totaled $132,500. The balance due of $172,924 is payable over the next 8 months with interest at 6% per annum.

Purchase price	$	405,424
Accounts receivable (net)	$	4,500
Furniture and fixtures		5,000
Membership list		395,923
Net assets acquired	$	405,423

On May 2, 2008, IMS acquired the assets of Business Network, Inc. of Hauppauge, New York for $400,000. Terms include a down payment of $200,000 and a $100,000 note to the seller, payable over 18 months with interest at 6% per annum. The first payment is due June 10, 2008. In addition IMS issued 133,333 shares of IMS common stock guaranteed to a value of $100,000 ($.75 per share).

Purchase price	$	400,000
Accounts receivable (net)	$	12,600
Furniture and fixtures		6,000
Membership list		381,400
Net assets acquired	$	400,000

11

On July 31, 2008, IMS completed its acquisition of the assets of Bartermax of Norwood, Massachusetts for $400,000. Terms include a cash down payment of $175,000, $50,000 in IMS trade dollars, and a $125,000 note to the seller, payable over 24 months with interest at 6% per annum. First payment is due September 20, 2008. In addition IMS issued 66,667 shares of IMS common stock guaranteed to a value of $50,000 ($.75 per share). .

Purchase price	$	400,000
Accounts receivable (net)	$	13,900
Furniture and fixtures		8,500
Membership list		377,600
Net assets acquired	$	400,000

NOTE 7 – LINES OF CREDIT AND NOTES PAYABLE

As of September 30, 2008 the company has drawn on its credit lines for a net amount of $309,000.

On April 30, 2008 IMS received $200,000 from a private investor in exchange for an interest-only convertible note, at 10% per annum. After two years the note can be converted into 377,358 shares of IMS common stock at $.53 per share, the fair value of the common stock on the date of the note.

On July 29, 2008 IMS received $100,000 from a private investor in exchange for an interest-only convertible note, at 10% per annum. After two years the note can be converted into 250,000 shares of IMS common stock at $.40 per share, the fair value of the common stock on the date of the note.

On September 29, 2008, IMS issued a note payable to a private investor in the amount of $1,200,000. The term of the note is five years using a ten year amortization schedule, at 10% per annum, with monthly payments of $15,858 beginning October 29, 2008. A balloon payment of $746,337 is due on October 29, 2013. The proceeds of this note will be used to retire three notes that had reached maturity, totaling $1,200,000, issued to the same investor.

NOTE 8 - STOCK OPTIONS

The Company adopted an incentive stock option plan under which certain officers, key employees, or prospective employees may purchase shares of the Company's stock at an established exercise price, which shall not be less than the fair market value at the time the option is granted. Final exercise date is any time prior to the five-year anniversary of the first exercise date.

SFAS 123R defines a fair value based method of accounting for employee stock options or similar equity instruments. Under the fair value based method, compensation cost is measured at the grant date based on the fair value of the award using an option-pricing model that takes into account the stock price at the grant date, the exercise price, the expected life of the option, the volatility of the underlying stock, expected dividends, and the risk-free interest rate over the expected life of the option. The resulting compensation cost is recognized over the service period, which is usually the vesting period.

12

A summary of the status of Company's fixed stock option plan as of September 30, 2008 and the changes during the period then ended is presented below:

	September 30, 2008
			Weighted Average
Fixed Options	Shares		Exercise Price
Outstanding at
beginning of period		820,000	$	0.16
Granted		-		-
Forfeited		-		-
Expired		-		-
Exercised		-
Outstanding at end of period		820,000	$	0.16
Options exercisable at
period end		820,000
Weighted average fair value
of options granted to
employees during the year	$	-

As of September 30, 2008 there were 820,000 options outstanding and exercisable, with a weighted average remaining contractual life of .30 years, and a weighted average exercise price of $0.16.

All options had vested prior to January 1, 2006.

STOCK ISSUANCES

The Company redeemed 229,333 shares of IMS common stock from the former owner of Alliance Barter, who was paid $172,000 in cash per the stock guarantee agreement.  Payment was made from restricted cash, and the stock was placed in treasury.

On April 10, 2008, 50,000 shares were issued to a vendor for services to be rendered in connection with investor relations. The shares were valued at $29,000 ($.58 per share).

On April 14, 2008 a private investor exercised 550,000 warrants for common stock of IMS. IMS received cash in the amount of $302,500 ($.55 per share) for the shares.

On May 1, 2008, 133,333 shares of IMS common stock valued at $100,000 ($.75 per share) were issued as part of the acquisition of specific assets of Business Network, Inc. of Hauppauge, New York.

On July 11, 2008 IMS issued 60,000 shares of common stock to the outside members of the board of directors. Six members were issued 10,000 shares each as annual compensation. The fair value of the shares was $27,000.

On August 1, 2008, 66,667 shares of IMS common stock valued at $50,000 ($.75 per share) were issued as part of the acquisition of specific assets of Bartermax of Norwood, Massachusetts.

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STOCK WARRANTS

As of September 30, 2008 there were 2,200,000 warrants outstanding. The warrants can be used to buy shares of the Company’s common stock at $.55 per share. The warrants expire May 31, 2011.

NOTE 9 - INCOME TAXES

The Company accounts for income taxes under Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes" ("Statement 109"). Under Statement 109, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities, and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under Statement 109, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

NOTE 10 – COMPREHENSIVE INCOME

SFAS No. 130, Reporting Comprehensive Income (SFAS 130) establishes rules for reporting and displaying of comprehensive income and its components. Comprehensive income is the sum of the net income (loss) as reported in the consolidated statements of operations and other comprehensive income transactions. Other comprehensive income transactions that currently apply to the Company result from changes in exchange rates used in translating the financial statements of its wholly owned subsidiary in Toronto, Canada.

Comprehensive income consisted of the following for the nine months ended September 30, 2008 and 2007:

	Nine Months			Nine Months
	Ended			Ended
	September 30, 2008			September 30, 2007
Net loss	$	(416,616	)	$	(261,597	)
Foreign currency translation adjustment		(10,249	)		12,788
Unrealized loss on available for sale securities		(21,144	)		-
Comprehensive income (loss)	$	(448,009	)	$	(248,806	)

NOTE 11 – PENDING LEGAL PROCEEDINGS

On February 26, 2008, a former employee of the company’s Connecticut office filed a lawsuit with the Equal Employee Opportunity Commission – Connecticut Commission on Human Rights and Opportunities, alleging that her termination from the company was based on age discrimination. The lawsuit is in the initial stages and no specific claim for damages has been identified in the suit. The Company believes the lawsuit is without merit and intends to vigorously oppose any settlement.

There are no other material pending legal proceedings involving IMS or any of its properties.

NOTE 12 – RECLASSIFICATIONS

Certain amounts from prior periods have been reclassified to conform to the current period presentation.

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NOTE 13 – RELATED PARTY TRANSACTIONS

The current lease for the IMS Executive offices and principle operating facilities expired on September 30, 2008. A new lease is being prepared for presentation to the board of directors for their approval at their next meeting. Until approved, by the board, the lease will continue on a month to month basis at the current rate.

At the board of directors meeting on June 17, 2008, is was RESOLVED: That the triple net lease be renewed for the IMS executive offices and principal operating facilities, consisting of 11,000 square feet of space located at 16901 W. Glendale Dr., New Berlin, WI, which are leased from Glendale Investments, LLC, a Wisconsin limited liability company owned by Donald Mardak, Dale Mardak and John Strabley, and their wives.

NOTE 14 - SUBSEQUENT EVENTS

On October 15, 2008 the Company redeemed 400,000 shares of IMS common stock from the former owner of Alliance Barter, who was paid $300,000 in cash per the stock guarantee agreement.  Payment was made from restricted cash, and the stock was placed in treasury.

On October 20, 2008 the Company issued two notes payable to the two former owners of Barter Partners. The notes are $25,000 each. The notes replaced the $50,000 stock guarantee issued as part of the purchase price of Barter Partners. The 50,000 guaranteed shares of IMS common stock were returned and placed in treasury. The terms of the notes consist of seven $3,000 payments and a final payment of $4,000 plus interest at 6% per annum.

On October 31, 2008 the Company drew an additional $80,000 on its’ line of credit for use on a temporary basis for working capital.

On October 31, 2008, 200,000 shares of IMS common stock were issued to a vendor for services to be rendered in connection with investor relations. The shares were valued at $38,000 ($.19 per share).

15

INTERNATIONAL MONETARY SYSTEMS, LTD.

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

         OF OPERATIONS

Results of Operations

During the quarter ended September 30, 2008, International Monetary Systems processed more than $27 million in trade transactions compared to over $26 million in the third quarter of 2007, an increase of more than 4.5%. The trade volume generated gross revenues of $3,537,840, compared to revenue of $3,563,578 in the third quarter of last year, a slight decrease of .7%.

Total expenses decreased 5.5%, from $3,716,140 in the third quarter of 2007 to $3,511,054 in the current period. The decrease is the result of our efforts to consolidate administrative operations, and to streamline sales and marketing costs by more quickly identifying under-performing elements.

Despite slightly lower revenues, the Company recorded net income from operations of $26,786 in the third quarter of 2008, compared to a loss from operations of $152,562 during the same period last year. After adjusting for interest expense and the income tax benefit, the net loss for the current period was $121,516, a decrease of 9.5% over the loss of $134,232 in the third quarter of 2007.

During the nine months ended September 30, 2008, International Monetary Systems generated gross revenue of $10,596,113 compared to $10,285,250 last year, an increase of 3.0%.

Total expenses increased from $10,573,326 in the first nine months of 2007 to $11,039,616 for the same period in 2008, an increase of 4.4%. The net loss from operations was $443,503 for the first nine months of 2008, compared to a loss of $288,076 for the same period last year.

The deferred tax benefit represents the adjustment to the deferred tax liability which arises from the differences in basis of acquired membership lists for financial reporting versus tax reporting.

The income tax expense (benefit) consists of:

	Nine Months			Nine Months
	Ended			Ended
	September 30, 2008			September 30, 2007
Income tax expense	$	50,000		$	67,000
Deferred tax benefit		(269,718	)		(328,143	)
	$	(219,718	)	$	(261,143	)

For the nine months ended September 30, 2008, net cash provided by operating activities totaled $310,428, compared to $976,872 for the same period of 2007.

Operating profit or EBITDA - earnings before interest, taxes, depreciation and amortization - totaled $791,304, a decrease of 4.35% from the $827,295 reported for the same period of 2007.  EBITDA is calculated as follows:

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	Nine Months			Nine Months
	Ended			Ended
	September 30, 2008			September 30, 2007
Net loss	$	(416,616	)	$	(261,594	)
Interest expense		202,485			271,426
Income tax (benefit)		(219,718	)		(261,143	)
Depreciation		222,192			180,228
Amortization		1,002,961			898,378
	$	791,304		$	827,295

Liquidity, Sources of Capital and Lines of Credit

On September 30, 2008, current assets were $3,258,814, and total assets were $18,103,362. Current liabilities were $3,399,105 and total liabilities were $9,073,204, resulting in total shareholder equity of $9,030,158 and a working capital deficiency of $140,291.

At the end of the third quarter of 2008 the Company's unrestricted cash balance was $408,221 compared to $812,365 on December 31, 2007. Though operations and financing activities generated $310,428 and $61,511, respectively, we used $765,834 in cash for investing activities: $495,000 for business acquisitions, more than $70,000 for equipment purchases, nearly $11,000 for marketable securities and life insurance, and nearly $192,000 to fund restricted cash. Cash also decreased due to a foreign currency translation adjustment of $10,249 from our Canadian operation.

In March 2008, the Company drew $210,000 on a line of credit. $100,000 was used as the down payment on the accelerated acquisition of New York Commerce Group. In June of 2008, $50,000 was paid to reduce the line of credit. In total the Company has borrowed net $309,000 against lines of credit in 2008.

We believe that current cash needs can be met with the current cash balance and from working capital generated over the next 12 months.

CRITICAL ACCOUNTING POLICIES

Our financial statements and accompanying notes are prepared in accordance with generally accepted accounting principles in the United States. Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses. These estimates and assumptions are affected by management's applications of accounting policies. Critical accounting policies for IMS include the following:

REVENUE SOURCES AND REVENUE RECOGNITION

The Company and its subsidiaries earn revenues in both traditional cash dollars and in IMS trade dollars. Cash income is earned through fees assessed when a member joins, transaction fees generated when clients earn or spend their trade dollars, monthly maintenance fees, finance charges on delinquent accounts receivable, and event fees.

Trade revenue is similarly generated through initial membership fees, monthly maintenance fees, transaction fees and event fees. Occasionally the Company will accept a favorable trade ratio in lieu of a cash fee. The Company uses earned trade dollars to purchase various goods and services required in its operations. All barter transactions are reported at the estimated fair value of the products or services received. Revenues are recognized when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the price is fixed or determinable, and collectability is reasonably assured.

17

Transaction fees are recognized upon receipt of transactional information accumulated by our systems or reported by our clients. Membership fees, monthly maintenance fees, finance charges, and other fees are billed monthly to members' accounts, and are recognized in the month the revenue is earned.

RECEIVABLES AND ALLOWANCE FOR DOUBTFUL ACCOUNTS

Accounts receivable are stated at face value, net of the allowance for bad debts. Finance charges on receivables are calculated using the simple interest method on the amount outstanding.

The allowance for bad debts is maintained at a level that is management's best estimate of probable bad debts incurred as of the balance sheet date. Management's determination of the adequacy of the allowance is based on an evaluation of the accounts receivable, past collection experience, current economic conditions, volume, growth and composition of the accounts receivable, and other relevant factors. Actual results may differ from these estimates. The allowance is increased by provisions for bad debts charged against income.

GOODWILL AND MEMBERSHIP LISTS

Goodwill and membership lists are stated at cost and arise when IMS acquires another company. Membership lists are amortized over the estimated life of ten years.

In 2002 the Company adopted Statement of Financial Accounting Standards (SFAS) No. 142, "Goodwill and Other Intangibles," which requires that goodwill and intangible assets with indefinite lives be tested annually for impairment. There was no impairment of goodwill or membership lists in the first nine months of 2008.

INCOME TAXES

The Company accounts for income taxes under the Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes" ("SFAS 109"). Under SFAS 109, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  Under SFAS 109, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

Recent Accounting Pronouncements

In December 2007, the Financial Accounting Standards Board (FASB) issued SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements – an amendment of ARB No. 51”. This statement improves the relevance, comparability, and transparency of the financial information that a reporting entity provides in its consolidated financial statements by establishing accounting and reporting standards that require: the ownership interests in subsidiaries held by parties other than the parent and the amount of consolidated net income attributable to the parent and to the non-controlling interest be clearly identified and presented on the face of the consolidated statement of income; changes in a parent’s ownership interest while the parent retains its controlling financial interest in its subsidiary be accounted for consistently; when a subsidiary is deconsolidated, any retained non-controlling equity investment in the former subsidiary be initially measured at fair value; entities provide sufficient disclosures that clearly identify and distinguish between the interests of the parent and the interests of the non-controlling owners. SFAS No. 160 affects those entities that have an outstanding non-controlling interest in one or more subsidiaries or that deconsolidate a subsidiary. SFAS No. 160 is effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2008. Early adoption is prohibited. The adoption of this statement is not expected to have a material effect on the Company's financial statements.

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In March 2008, the FASB issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities, an amendment of FASB Statement No. 133” (SFAS 161). This statement is intended to improve transparency in financial reporting by requiring enhanced disclosures of an entity’s derivative instruments and hedging activities and their effects on the entity’s financial position, financial performance, and cash flows. SFAS 161 applies to all derivative instruments within the scope of SFAS 133, “Accounting for Derivative Instruments and Hedging Activities” (SFAS 133), as well as related hedged items, bifurcated derivatives, and non-derivative instruments that are designated and qualify as hedging instruments. Entities with instruments subject to SFAS 161 must provide more robust qualitative disclosures and expanded quantitative disclosures. SFAS 161 is effective prospectively for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, with early application permitted. We are currently evaluating the disclosure implications of this statement.

In May 2008, the FASB issued FASB Staff Position APB 14-1 (FSP APB 14-1), “Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement)”, which applies to all convertible debt instruments that have a “net settlement feature”, which means that such convertible debt instruments, by their terms, may be settled either wholly or partially in cash upon conversion. FSP APB 14-1 requires issuers of convertible debt instruments that may be settled wholly or partially in cash upon conversion to separately account for the liability and equity components in a manner reflective of the issuers’ nonconvertible debt borrowing rate. FSP APB 14-1 is effective for financial statements issued for fiscal years beginning after December 15, 2008 and interim periods within those fiscal years. Early adoption is not permitted and retroactive application to all periods presented is required. We continue to evaluate the application of FSP APB 14-1 on our financial statements.

In May 2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted Accounting Principles.” SFAS No. 162 identifies the sources of accounting principles and provides entities with a framework for selecting the principles used in preparation of financial statements that are presented in conformity with GAAP. The current GAAP hierarchy has been criticized because it is directed to the auditor rather than the entity, it is complex, and it ranks FASB Statements of Financial Accounting Concepts, which are subject to the same level of due process as FASB Statements of Financial Accounting Standards, below industry practices that are widely recognized as generally accepted but that are not subject to due process. The Board believes the GAAP hierarchy should be directed to entities because it is the entity (not its auditors) that is responsible for selecting accounting principles for financial statements that are presented in conformity with GAAP. SFAS 162 is effective 60 days following the SEC’s approval of PCAOB Auditing Standard No. 6, Evaluating Consistency of Financial Statements (AS/6). The adoption of FASB 162 is not expected to have a material impact on the Company’s financial position.

In May 2008, the FASB issued SFAS No. 163, “Accounting for Financial Guarantee Insurance Contracts-an interpretation of FASB Statement No. 60.” Diversity exists in practice in accounting for financial guarantee insurance contracts by insurance enterprises under FASB Statement No. 60, Accounting and Reporting by Insurance Enterprises. This results in inconsistencies in the recognition and measurement of claim liabilities. This Statement requires that an insurance enterprise recognize a claim liability prior to an event of default (insured event) when there is evidence that credit deterioration has occurred in an insured financial obligation. This Statement requires expanded disclosures about financial guarantee insurance contracts. The accounting and disclosure requirements of the Statement will improve the quality of information provided to users of financial statements.  SFAS 163 is effective for financial statements issued for fiscal years beginning after December 15, 2008, and interim periods within those fiscal years. The adoption of FASB 163 is not expected to have a material impact on the Company’s financial position.

OFF BALANCE SHEET ARRANGEMENTS

IMS does not have any off balance sheet arrangements.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There have been no material changes to our exposures to market risk since December 31, 2007.

ITEM 4. CONTROLS AND PRODCECURES

Members of our management, including Don F Mardak, our Chief Executive Officer, Danny W Weibling, our Chief Financial Officer, have evaluated the effectiveness of our disclosure controls and procedures, as of September 30, 2008, the end of the period covered by this report. Based upon that evaluation, Mr. Mardak and Mr. Weibling concluded that our disclosure controls and procedures are effective.

INTERNAL CONTROL OVER FINANCIAL REPORTING

Under the supervision and with the participation of our management, including the principal executive officer and principal financial officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(c) and Rule 15d-15(c) promulgated under the Securities Exchange Act of 1934, as amended (Exchange Act), as of September 30, 2008. Based on this evaluation, our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures are effective to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time period specified in the Securities and Exchange Commission's rules and forms, and that our disclosure and controls are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Controls

There were no changes (including corrective actions with regard to significant deficiencies or material weaknesses) in our internal controls over financial reporting that occurred during the second quarter of fiscal 2008 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

20

INTERNATIONAL MONETARY SYSTEMS, LTD.

Part II.                      Other Information

Item 1.   Legal Proceedings

On February 26, 2008, a former employee of the company’s Connecticut office filed a lawsuit with the Equal Employee Opportunity Commission – Connecticut Commission on Human Rights and Opportunities, alleging that her termination from the company was based on age discrimination. The lawsuit is in the initial stages and no specific claim for damages has been identified in the suit. The Company believes the lawsuit is without merit and intends to vigorously oppose any settlement.

There are no other material pending legal proceedings involving IMS or any of its properties.

Item 1A. Risk Factors - None

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

On July 11, 2008 IMS issued 60,000 shares of common stock to the outside members of the board of directors. Six members were issued 10,000 shares each as annual compensation. The transaction is exempt from registration under the Securities Act of 1933 in reliance on an exemption provided by Section 4(2) of that act.

On August 1, 2008, 66,667 shares of IMS common stock valued at $50,000 ($.75 per share) were issued as part of the acquisition of specific assets of Bartermax of Norwood, Massachusetts. The transaction is exempt from registration under the Securities Act of 1933 in reliance on an exemption provided by Section 4(2) of that act.

Item 3.   Defaults Upon Senior Securities - None

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

The Security Holders voted at the annual meeting on June 17, 2008 to elect 3 board members and to ratify Webb & Company, PA as our auditors for the year ending December 31, 2008.

The following directors were elected or re-elected at the annual meeting:

Wayne Dalin

Wayne Emmer

Donald Mardak

The terms for the following directors continued after the meeting:

Thomas Delacy

Dale Mardak

John Strabley

Gerald Van Dyn Hoven

Stephen Webster

Item 5.   Other Information – None

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Item 6.   Exhibits and Reports on Form 8-K

(a)   Exhibits

31.1  Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) of the Exchange Act.

31.2  Certification of Principal Financial and Accounting Officer Pursuant to Rule 13a-14(a) of the Exchange Act.

32.1  Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2  Certification of Principal Financial and Accounting Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

(b)  Reports on Form 8-K

A Form 8-K was filed on April 4, 2008 reporting the exercising of the option to acquire specific assets of New York Commerce Group of New York, NY.

 A  From 8-K was filed on April 11, 2008 reporting the exercise of 550,000 of warrants for common stock of IMS for $302,500.

A Form 8-K was filed on May 2, 2008 reporting the acquisition of specific assets of Business Network, Inc. of Hauppauge, New York.

A Form 8-K was filed on August 1, 2008 reporting the acquisition of specific assets of Bartermax of Norwood, Massachusetts.

A Form 8-K was filed on October 3, 2008 reporting the issuance of a note payable to a private investor in the amount of $1,200,000. The note was used to retire 3 other notes totaling $1,200,000 for the same investor.

22

INTERNATIONAL MONETARY SYSTEMS, LTD.

Signatures

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

International Monetary Systems, Ltd. (Registrant)

/s/ Donald M Mardak

Donald F. Mardak, President

(Principal Executive Officer)

November 11, 2008

/s/ Danny W Weibling

Danny W Weibling, CPA, Treasurer

(Chief Financial Officer)

November 11, 2008

23

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Donald F. Mardak, certify that:

1. I have reviewed this quarterly report on Form 10-Q of International Monetary Systems, Ltd..;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 11, 2008

By: /s/ Donald F Mardak

Donald F Mardak,

Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Danny W Weibling, certify that:

1. I have reviewed this quarterly report on Form 10-Q of International Monetary Systems, Ltd.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 11, 2008

By: /s/ Danny W Weibling

Danny W Weibling

Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of International Monetary Systems, Ltd. ("Company") on Form 10-Q for the period ending September 30, 2008 filed with the Securities and Exchange Commission ("Report"), I, Donald M. Mardak, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002, that:

1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

/s/ Donald M. Mardak

Donald M. Mardak

Chief Executive Officer

November 11, 2008

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of International Monetary Systems, Ltd. ("Company") on Form 10-Q for the period ending September 30, 2008 as filed with the Securities and Exchange Commission ("Report"), I, Danny W Weibling. Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002, that:

1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

/s/ Danny W Weibling

Danny W Weibling

Chief Financial Officer

November 11, 2008