10-Q

U. S. 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 December 31, 2008
[  ]	TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to _____________

ACTION FASHIONS, LTD.

Colorado	000-52413	20-4092640
(State or other jurisdiction	(Commission File Number)	(IRS Employer
of Incorporation)		Identification Number)
	P.O. Box 235472
	Encinitas, CA 92024
	(Address of principal executive offices)
	(858) 229-8116
	(Issuer’s Telephone Number)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act of 1934 during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes X No ___

Indicate by check mark whether the registrant 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 Rule12b-2 of the Exchange Act.

Large accelerated filer  [   ]	Accelerated filer    [    ]
Non-accelerated filer    [   ] (Do not check if smaller reporting company)	Smaller reporting company    [X]

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

Yes [  ] No [ X ]

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant filed all documents and reports required to be filed by Section 12, 13, or 15(d) of the Exchange Act of 1934 after the distribution of securities under a plan confirmed by a court. Yes ___ No ____

APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date:  As of  December 31, 2008, there were 136,499,000 shares of our common stock were issued and outstanding.

PART I

ITEM 1.FINANCIAL STATEMENTS

ACTION FASHIONS, LTD.
	Page
Condensed Balance Sheets at December 31, 2008 (unaudited) and March 31, 2008	F-2
Condensed and Unaudited Statements of Operations for the nine months ended December 31, 2008 and 2007 and the three months ended December 31, 2008 and 2007	F-3
Condensed and Unaudited Statement of Changes in Shareholders' Deficit for the nine months ended December 31, 2008	F-4
Condensed and Unaudited Statements of Cash Flows for the nine months ended December  31, 2008 and 2007	F-5
Notes to Financial Statements	F-6
F-1

ACTION FASHIONS, LTD.
CONDENSED BALANCE SHEETS
				December 31,		March 31,
				2008		2008
				(Unaudited)		(Derived from
						Audited
						Statements)
ASSETS
Current assets:
	Cash		$	3,406	$	2,327
	Due from related party (Note 6)			4,297		2,652
	Inventory			10,055		10,219
		Total current assets		17,757		15,198
TOTAL ASSETS			$	17,757	$	15,198
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
	Accounts payable		$	8,032	$	6,000
	Sales tax payable			408		406
	Loans payable to related party (Note 3)			29,815		17,687
	Note payable to related party (Note 3)			475,000		475,000
		Total current liabilities		513,255		499,093
STOCKHOLDERS' DEFICIT (Note 4)
	Preferred stock, 10,000,000 shares authorized, no par value,
		-0- shares issued and outstanding		—		—
	Common stock, 500,000,000 shares authorized, no par value,
		136,481,000 shares issued and outstanding as at March 31, 2008
		136,499,000 shares issued and outstanding as at December 31, 2008 (Unaudited)		7,429		7,411
	Retained deficit			(502,927)		(491,306)
TOTAL STOCKHOLDERS' DEFICIT				(495,498)		(483,895)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT			$	17,757	$	15,198
See notes to the accompanying condensed, unaudited financial statements
F-2

ACTION FASHION, LTD.
CONDENSED AND UNAUDITED STATEMENTS OF OPERATIONS
		Nine Months ended						Three Months ended
		December 31,						December 31,
		2008			2007			2008			2007
Revenues:
Sales		$	17,698		$	14,711		$	6,210		$	4,600
Total revenues			17,698			14,711			6,210			4,600
Expenses:
Cost of Goods Sold			11,929			11,819			4,060			4,159
General and administrative			17,372			16			8,485			16
Compensation expense (Notes 3 and 4)			18			80,000			6			20,000
Total operating expenses			29,319			91,835			12,551			24,175
Loss from operations			(11,621	)		(77,124	)		(6,341	)		(19,575	)
Provision for Income Taxes (Note 5)			-			-			-			-
NET LOSS		$	(11,621	)	$	(77,124	)	$	(6,341	)	$	(19,575	)
Basic loss per common share		$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.00	)
Diluted loss per common share		$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.00	)
Weighted average common shares outstanding - Basic			136,486,200			136,475,000			136,494,000			136,475,000
Weighted average common shares outstanding - Diluted			136,486,200			136,475,000			136,494,000			136,475,000
See notes to the accompanying condensed, unaudited financial statements
	F-3

ACTION FASHION LTD.
STATEMENT OF CHANGES IN STOCKHOLDERS' DEFICIT
									Total
	Common Stock					Retained			Stockholders'
	Shares			Amount		Deficit			Deficit
Balance at March 31, 2008		136,481,000		$	7,411	$	(491,306	)	$	(483,895	)
Shares issued to existing shareholders in
exchange for existing shares on a one-for-one
basis (Note 4) (unaudited)		136,481,000			—		—			—
Shares returned and cancelled from existing
shareholders due to exchange of common shares
on a one-for-one basis (Note 4) (unaudited)		(136,481,000	)		—		—			—
Shares issued for services (unaudited)		18,000			18		—			18
Net loss for the nine months ended
December 31, 2008 (unaudited)		—			—		(11,621	)		(11,621	)
Balance at December  31, 2008 (unaudited)		136,499,000		$	7,429	$	(502,927	)	$	(495,498	)
See notes to the accompanying condensed, unaudited financial statements
	F-4

ACTION FASHION, LTD.
CONDENSED AND UNAUDITED STATEMENTS OF CASH FLOWS
			Nine  Months Ended
			December 31,
			2008		2007
CASH FLOWS FROM OPERATING ACTIVITIES
	Net loss	$	(11,621)	$	(77,124)
	Adjustments to reconcile net income to net cash
	provided by (used in) operating activities:
	Stock based compensation		18		-
	Changes in operating assets and liabilities:
	Receivable from GK Gym		(1,645)		(2,083)
	Prepaid Expenses		-		80,000
	Inventory		165		337
	Accounts payable and accrued expenses		2,034		(1,405)
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES			(11,049)		(275)
CASH FLOWS FROM FINANCING ACTIVITIES
	Bank Overdraft				549
	Proceeds from loan payable to officer		12,128		-
	Principal payments on notes payable		-		(6,135)
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES			12,128		(5,586)
NET CHANGE IN CASH			1,079		(5,861)
CASH BALANCES
	Beginning of period		2,327		5,861
	End of period	$	3,406	$	0
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
CASH PAID DURING THE PERIOD FOR:
	Interest	$	-	$	-
	Income taxes	$	-	$	-
See notes to the accompanying condensed, unaudited financial statements
F-5

ACTION FASHIONS, LTD.

Notes to Financial Statements

NOTE 1.                      BASIS OF PRESENTATION

The accompanying interim financial statements of Action Fashions, Ltd. (the “Company”) have been prepared pursuant to the rules of the Securities and Exchange Commission (the "SEC") for quarterly reports on Form 10-Q and do not include all of the information and note disclosures required by generally accepted accounting principles. These financial statements and notes herein are unaudited, but in the opinion of management, include all the adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of the Company’s financial position, results of operations, and cash flows for the periods presented. These financial statements should be read in conjunction with the Company's audited financial statements and notes thereto included in the Company’s Form 10-KSB for the period ended March 31, 2008 as filed with the SEC. Interim operating results are not necessarily indicative of operating results for any future interim period or for the full year.

NOTE 2.                      GOING CONCERN

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.  As shown in the accompanying financial statements, the Company has a limited operating history and limited funds.  These factors, among others, may indicate that the Company will be unable to continue as a going concern.

The Company is dependent upon outside financing to continue operations. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.  It is management’s plans to raise necessary funds via a private placement of its common stock to satisfy the capital requirements of the Company’s business plan.  There is no assurance that the Company will be able to raise necessary funds, or that if it is successful in raising the necessary funds, that the Company will successfully operate its business plan.

The financial statements do not include any adjustments relating to the recoverability and classification of assets and/or liabilities that might be necessary should the Company be unable to continue as a going concern. Our continuation as a going concern is dependent upon our ability to meet our obligations on a timely basis, and, ultimately to attain profitability.

NOTE 3. RELATED PARTY TRANSACTIONS

Employment Agreement

On December 6, 2003, the Company entered into a 48 month employment agreement with Phillip E. Koehnke, our former sole officer and Director.  The Company charged the compensation expense ratably over the term of the 48 month employment agreement.   Payment under the terms of the employment agreement was secured by a $480,000, 48 month, zero interest convertible promissory note.  The Company issued Mr. Koehnke 125,000,000 post split shares of its restricted common stock during March 2006 in exchange for payment of $5,000 of the convertible note, which reduced the balance owed on the note to $475,000.  The note matured on November 1, 2007.

Loans Payable to Related Party

On March 31, 2008, the Company made a two year zero interest promissory note payable to Phillip E. Koehnke, APC, our majority shareholder, in the amount of $17,687.

On June 30, 2008 the Company made a two year zero interest promissory note payable to Phillip E. Koehnke, APC, our majority shareholder, in the amount of $4,271.

On September 30, 2008, the Company made a two year zero interest promissory note payable to Phillip E. Koehnke, APC, our majority shareholder, in the amount of $4,722.

On December 31, 2008 the company made a two year zero interest promissory note payable to Phillip E. Koehnke, APC, our majority shareholder in the amount of $3,135.

Line of Credit

Effective, April 1, 2007, the Company entered into a line of credit agreement with G.K.’s Gym, Inc. establishing a $15,000 line of credit for purchasing of inventory.  The line of credit agreement bears an interest rate of 6% on outstanding principle, expires on March 31, 2009 and has a balance of $0 as of December 31, 2008.

Office Lease

On June 1, 2005, the Company entered into a lease with G.K.’s Gym, Inc. for its retail space.  The lease ends on May 31, 2010.  Monthly rent is $200 per month commencing on June 1, 2007.

Future minimum lease payments required under the arrangement are as follows:

March 31,		Amount
2009………		2,400
2010………		1,000
	$	3,400

Legal Services

Legal counsel to the Company is a firm controlled by our majority shareholder.

NOTE 4. STOCKHOLDERS’ DEFICIT

The stockholders’ equity section of the Company contains the following classes of capital stock as of December 31, 2008:

Preferred stock, no par value; 10,000,000 shares authorized, no shares issued and outstanding.

Common stock, no par value; 500,000,000 shares authorized: 136,499,000 shares issued and outstanding.

Common Stock Transactions

On or about March 31, 2008 the Company issued 6,000 shares of its restricted common stock to Susie Johnson, the Company’s President, as payment for services rendered during the three months ended March 31, 2008.  The transaction was recorded at fair value, or $6.

On or about June 30, 2008 the Company issued 6,000 shares of its restricted common stock to Susie Johnson, the Company’s President, as payment for services rendered during the three months ended June 30, 2008.  The transaction was recorded at fair value, or $6.

On or about September 30, 2008 the Company issued 6,000 shares of its restricted common stock to Susie Johnson, the Company’s President, as payment for services rendered during the three months ended September 30, 2008.  The transaction was recorded at fair value, or $6.

On or about December 31, 2008 the Company issued 6,000 shares of its restricted common stock to Susie Johnson, the Company’s President, as payment for services rendered during the three months ended December 31, 2008.  The transaction was recorded at fair value, or $6.

Exchange of Shares with Existing Shareholders

On April 1, 2008 the Company issued 136,481,000 shares to its existing shareholders in exchange for their existing (old) shares on a 1 for 1 basis.  No value was assigned to the exchange of shares.  The old shares were returned to treasury and cancelled.

The purpose of the exchange was to replace the previously issued shares of common stock which FINRA had deemed were not subject to the exemptions provided by Rule 144 of the Securities Act of 1933.

NOTE 5. INCOME TAXES

The Company records its income taxes in accordance with SFAS No. 109, “Accounting for Income Taxes”.  The Company incurred net operating losses during all periods presented resulting in a deferred tax asset, which was fully allowed for; therefore, the net benefit and expense resulted in $-0- income taxes.

NOTE 6. CONCENTRATION OF CREDIT RISK

The Company’s sole retail outlet is presently within the facilities of G.K. Gymnastics, Inc. (“GK”), a dance and gymnastics school/studio located in Fort Collins, Colorado.  The Company is dependent upon the clientele generated by the dance studio. If the business of the school/studio declines or ceases to exist, the Company’s sales could also decline or cease to exist.

GK is a related party to the Company.  The owners of GK are the parents of Phillip E. Koehnke, the Company’s majority shareholder.  As of December 31, 2008, GK owed the Company $4,297 in addition to $3,400 in unpaid rent expense.

F-6

ITEM 2.                      MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION ORPLAN OF OPERATIONS

The following discussion and analysis should be read in conjunction with our unaudited consolidated financial statements and related notes included in this report. The statements contained in this report that are not historic in nature, particularly those that utilize terminology such as “may,” “will,” “should,” “expects,” “anticipates,” “estimates,” “believes,” or “plans” or comparable terminology are forward-looking statements based on current expectations and assumptions.

Various risks and uncertainties could cause actual results to differ materially from those expressed in forward-looking statements.

The forward-looking events discussed in this report, the documents to which we refer you and other statements made from time to time by us or our representatives, may not occur, and actual events and results may differ materially and are subject to risks, uncertainties and assumptions about us. For these statements, we claim the protection of the “bespeaks caution” doctrine. All forward-looking statements in this document are based on information currently available to us as of the date of this report, and we assume no obligation to update any forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements.

The Company

Action Fashions, Ltd. is in the business of retail sports apparel sales. Our executive offices are located at, P.O. Box 235472, Encinitas, California, 92024.  Our telephone number is (858) 229-8116.  Our retail location is located at 2026 Lowe Street, Fort Collins, CO 80525.

We were originally incorporated under the laws of the State of Colorado on June 22, 1990, as U.S.A. Connection, Inc.  On June 1, 2005, we entered into an arms length asset purchase agreement with G.K. Gymnastics, Inc. to purchase the retail inventory of G.K. Gymnastics, Inc. for a total purchase price of $19,000 which was wholesale value of the goods purchased.  The $19,000 purchase price was paid for with a five year, zero interest, $19,000 promissory note.  October 28, 2005, we filed Articles of Amendment with the Colorado Secretary of State changing our name to Action Fashions, Ltd. to better reflect our business operations.  Our fiscal year end is March 31st.

The Business

We are an apparel company specializing in the retail sales of exercise, gymnastics, and dance apparel including clothing, outfits, shoes and related accessories.  Our sole retail outlet is presently located within the facilities of G.K. Gymnastics, Inc., a dance and gymnastics school/studio located in Fort Collins, Colorado. By embedding our retail facility internally at the school/studio we have been able to market to a captive audience of dance and gymnastics students with minimal outside competition. Our goal is to expand our retail outlet from the current location to multiple dance and gymnastics schools throughout the country beginning with the State of Colorado.  Our auditors have expressed concern about our ability to continue as a going concern.

Business Strategy

Our retail location is presently located within the 30,000 square foot building of the G.K. Gymnastics, Inc. dance and gymnastics school/studio in Fort Collins, Colorado. The G.K. Gymnastics, Inc. facility has over 700 students, not including their other family members.  These students and their families serve as our customer base.

Our retail location is situated near the main entrance of the G. K. Gymnastics, Inc. facility and has its own separate entrance.  By embedding the retail facility internally at the school/studio we are able to market to a captive audience of dance and gymnastics students with minimal outside competition. We have found that the relationship between our retail store and the school/studio has both increased store sales and satisfied a consumer need for the studio/school and its members.  In addition, we believe that our relationship with the school/studio gives us an advantage over our competitors because most sales outlets for dance and gymnastics apparel exist in larger sporting goods stores, department stores and a limited number of specialty athletic clothing stores. By focusing our sales inside the school/studio we can target our market when the customer enters and exits the school/facility and we believe we will be able to compete more efficiently with larger retail competitors. By placing our store front locations in areas of high target customer traffic with highly visible product placement and creative store displays, we hope to attract an increased customer sales base.  Our staff are typically experienced dance and gymnastics instructors that are usually familiar with the customer and understand the customer’s needs.

 We conduct limited marketing and advertising utilizing the local Yellow Pages, various mailings and fliers.  We primarily rely upon our individual store displays, embedded location and word-of-mouth to attract customers. Our product lines are supported by visual merchandising, which consists of window displays, table layouts and various promotions. This type of marketing is an important component of our marketing and promotion strategies since our embedded location provides significant target customer foot traffic.

We have found that many schools and studios throughout the country already maintain in-store retail sales departments.  However, these “stores” are usually poorly run, unorganized and not properly inventoried.  Our goal is to offer school/studio owners a profit center without the headache and hassle of merchandizing, inventorying and returning products.

In addition to our existing location in Fort Collins, Colorado, within the next 12 months, we plan to expand our business into 2 to 4 new locations in existing gymnastics and dance schools and studios in the state of Colorado.

Our goal is to offer other gymnastic and dance schools a “pre-packaged” retail store whereby we will design and construct small retail outlets within the school/studio, supply the inventory on an ongoing basis and train the school/studio’s existing staff to sell the products.  We will split the profits from the sales with the school/studios on a negotiated basis pursuant to contractual agreements.  The pre-packaged program that will allow the studios and schools to offer their captive customers dance and gymnastics apparel from within their existing facility without the cost and burden of establishing the store, seeking vendors and/or purchasing large amounts of inventory.  We estimate the cost for each location to be approximately $25,000 - $40,000 depending on the location, and plan on raising the funds by a private placement of our securities.

Competitive Business Conditions

The retail gymnastics and dance apparel industry is competitive and highly fragmented with no standout industry leaders. This type of apparel is usually sold though sporting goods stores, department stores and a limited number of specialty athletic clothing stores. We believe our target customers choose to purchase apparel based on the following factors: style and fashion, fit and comfort, customer service, shopping convenience and environment and value and we believe that we have advantages over our competitors in meeting these needs. Specifically, by locating our store within dance and gymnastics studios, we are able to make the sale immediately before or after the customer participates in the activity in which the apparel is used.

We experience the normal seasonal pattern of the retail apparel industry with our peak sales occurring during the Christmas, back-to-school and spring periods. In addition, we also experience additional sales and interest increases in cyclical periods surrounding the Summer Olympics. To keep merchandise fresh and fashionable, slow-moving merchandise is marked down throughout the year.

Distribution Methods of the Products

We currently market our products to a limited captive market based on our current location. Products are sold on site with little distribution and shipping costs. We project revenue increase from future expansion by adding additional retail outlets in various target market areas throughout the country.  There is no assurance of the revenue increase from future expansion or that expansion will occur at all.

Results of Operations

For the nine months ended December 31, 2008, we had revenues of $17,698 compared to $14,711 for the nine months ended December 31, 2007.   We attribute this increase in sales due to increased enrolment in the gymnastics facility and the recent 2008 summer Olympics.

For the nine months ended December 31, 2008, we had total operating expenses of $29,319 and an operating loss of ($11,621) compared to total operating expenses of $91,835 and an operating loss of ($77,124) for the nine months ended December 31, 2007.  The substantial decrease in operating expenses for the nine months ended December 31, 2008, is attributable to the expiration of the employment agreement with Mr. Koehnke, thus reducing our quarterly operating expenses by $30,000.  In addition, we saw increased sales for the nine months ended December 31, 2008.

Generally, our cost of goods, wholesale prices and inventory have remained stable over the past 12 months.

As expected, our sales increase his quarter primarily due to the 2008 summer Olympics in Beijing, China.  We expect that sales should slightly increase next quarter as well. Historically, national interest in the summer Olympics has significantly increased enrolment in gymnastics schools throughout the United States.   While summer enrolment in the gymnastics school is generally down due to competing summer activities available to children, we anticipate that our sales will increase through the end of 2008 and though 2009 with the increased advertising of the summer Olympics and the anticipated increased enrollment in the gymnastic school facility in which our business is located.

With the increased enrolment in gymnastics and dance activities, we expect that there will be an increased need for our apparel and thus increased sales.

Liquidity and Capital Resources

At December 31, 2008, we had cash of $3,406 compared to $2,327 at March 31, 2008.   As at February 3, 2009, we have $3,900 cash on hand.

Future Goals

Since our inception, our goal has been to expand our business into new locations.  Our goal was to be a fully reporting company with our shares of common stock trading in the public market prior to the beginning of the 2008 summer Olympics.  With the increase interest in gymnastics following the summer Olympics, we believed that this would be a catalyst to begin our expansion plan.  However, although we have been able to become a reporting company, we have had continuing difficulties in filing our 211 application with FINRA and as of the date of this Report, our 211 application has not been completed and our common stock is not trading in the public market.  This is unfortunate as the 2008 summer Olympics are now over as of the date of this Report.

As of the date of this Report, our revised goal is to have our common stock trading in the public market within the next 6 to 12 months.  If we are successful, our next goal is to seek financing for our expansion goals whether it be through bank loans or a private placement of our securities.  If we are unable to successfully file our 211 application or obtain proper financing, we may have to reevaluate our business plan and future operations.

Assuming we obtain proper financing, we plan on expanding into the Loveland, Colorado location during the second half of our fiscal year and opening in another 2-4 locations thereafter.  The opening of additional locations is dependent upon sufficient financing and the identification of suitable gymnastic/dance school facilities.  We anticipate that each new location will require approximately $25,000 - $40,000 to open depending upon the location.

Off-balance Sheet Arrangements

We maintain no significant off-balance sheet arrangements

Foreign Currency Transactions

None.

Number of total employees and number of full time employees.

We do not have any full time employees and do not expect to hire any new employees within the next 12 months. Ms. Johnson is our sole officer and director.

ITEM 3.                      QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We currently do not utilize sensitive instruments subject market risk in our operations.

ITEM 4.                      CONTROLS AND PROCEDURES

As required by Rule 13a-15 under the Securities Exchange Act of 1934 (“Exchange Act”) we carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of June 30, 2008, being the date of our most recently completed fiscal quarter. This evaluation was carried out under the supervision and with the participation of our Chief Executive Officer/Chief Financial Officer. Based upon that evaluation, our sole officer has concluded that our disclosure controls and procedures were effective to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to them to allow timely decisions regarding required disclosure. There were not any changes in our internal control over financial reporting during our most recent fiscal quarter that have materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

None.

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

None.

ITEM 3. DEFAULT UPON SENIOR SECURITIES

None.

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

None.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

Exhibit #	Description
3.1	Articles of Incorporation filed with the Secretary of State of Colorado on June 22, 1990 (Filed as an exhibit to our registration statement on Form 10-SB filed on January 24, 2007).
3.2	Articles of Amendment to the Articles of Incorporation filed with the Secretary of State of Colorado on October 17, 2006 (Filed as an exhibit to our registration statement on Form 10-SB filed on January 24, 2007).
3.3	Articles of Amendment to Articles of Incorporation filed with the Secretary of State of the State of Colorado on January 25, 2007 (Filed as an exhibit to our annual report on Form 10-KSB filed on June 29, 2007).
3.3	Amended and Restated Bylaws dated December 30, 2005 (Filed as an exhibit to our registration statement on Form 10-SB filed on January 24, 2007).
4.1	June 1, 2005, Promissory Note in the amount of $19,000 made by the Company to G.K.’s Gym, Inc. as payment for assets (Filed as an exhibit to our registration statement on Form 10-SB filed on January 24, 2007).
4.2	December 6, 2003, Convertible Promissory Note in the amount of $480,000 made by the Company to Phillip E. Koehnke as payment under the terms of Mr. Koehnke’s employment agreement with the Company (Filed as an exhibit to our registration statement on Form 10-SB file on January 24, 2007).
10.1	Employment agreement dated December 6, 2003, between the Company and Phillip E. Koehnke (Filed as an exhibit to our registration statement on Form 10-SB filed on January 24, 2007).
10.2	June 1, 2005, Asset Purchase Agreement by and between the Company and G.K.’s Gymnastics, Inc. (Filed as an exhibit to our registration statement on Form 10-SB filed on January 24, 2007).
14.1	Code of Ethics (Filed as an exhibit to our annual report on Form 10-KSB filed on June 29, 2007).
31.1	Certification of Susie Johnson, pursuant to Rule 13a-14(a) (Attached hereto).
32.1	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Attached hereto).

Signatures

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

February 12, 2009

/s/ Susie Johnson

Susie Johnson

Chief Executive Officer

Chief Financial Officer

EX-31.1

Exhibit 31.1

I, Susie Johnson, certify that:

1.I have reviewed this Form 10-Q of Action Fashions, 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 small business issuer as of, and for, the periods presented in this report;

4.The small business issuer's other certifying officer(s) 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 small business issuer 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 small business issuer, 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 small business issuer'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 small business issuer's internal control over financial reporting that occurred during the small business issuer's most recent fiscal quarter (the small business issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and

5.The small business issuer's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of the small business issuer'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 small business issuer'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 small business issuer's internal control over financial reporting.

Date:        February 12, 2009

/s/ Susie Johnson

Susie Johnson

                Chief Executive Officer & Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Action Fashions, Ltd., a Colorado Corporation, (the “Company”) on Form 10-Q for the period ended December 31, 2008, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned certify the following pursuant to Section 18, U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002:

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 results of operations of the Company.

/s/ Susie Johnson

Susie Johnson

Chief Executive Officer and

Chief Financial Officer

February 12, 2009