UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-QSB

(Mark One)

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

For the quarterly period ended June 30, 2007

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

For the transition period from                      to                     

Commission file number: 0-14807

AMERICAN CLAIMS EVALUATION, INC.

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

New York			11-2601199
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

One Jericho Plaza, Jericho, New York    11753

(Address of principal executive offices)

(516) 938-8000

(Issuer’s telephone number)

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

As of August 9, 2007, there were 4,761,800 shares of the issuer’s common stock, $.01 par value, outstanding.

Transitional Small Business Disclosure Format (Check one): Yes     No

AMERICAN CLAIMS EVALUATION, INC. AND SUBSIDIARY

INDEX

						Page No.
PART I — FINANCIAL INFORMATION
Item 1.			Financial Statements
			Condensed Consolidated Balance Sheets as of June 30, 2007 (unaudited) and March 31, 2007			3
			Condensed Consolidated Statements of Operations for the Three Months ended June 30, 2007 and 2006 (unaudited)			4
			Condensed Consolidated Statements of Cash Flows for the Three Months ended June 30, 2007 and 2006 (unaudited)			5
			Notes to Condensed Consolidated Financial Statements (unaudited)			6 - 7
Item 2.			Management’s Discussion and Analysis or Plan of Operation			7 - 8
Item 3.			Controls and Procedures			8 - 9
PART II — OTHER INFORMATION
Item 6.			Exhibits			10
SIGNATURES						11

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PART I — FINANCIAL INFORMATION

Item 1.    Financial Statements.

AMERICAN CLAIMS EVALUATION, INC. AND SUBSIDIARY

Condensed Consolidated Balance Sheets

			June 30, 2007						Mar. 31, 2007
			(Unaudited)
Assets
Current assets:
Cash and cash equivalents				$	6,540,435					$	6,647,267
Accounts receivable, net					76,746						64,851
Prepaid expenses					34,938						41,154
Total current assets					6,652,119						6,753,272
Property and equipment, net					116,694						83,627
Total assets				$	6,768,813					$	6,836,899
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable				$	27,360					$	22,394
Accrued expenses					110,724						101,887
Total current liabilities					138,084						124,281
Commitments
Stockholders’ equity:
Common stock, $.01 par value. Authorized 10,000,000 shares; issued 5,050,000 shares; outstanding 4,761,800 shares					50,500						50,500
Additional paid-in capital					4,931,099						4,646,099
Retained earnings					2,110,971						2,477,860
					7,092,570						7,174,459
Treasury stock, at cost					(461,841	)					(461,841	)
Total stockholders’ equity					6,630,729						6,712,618
Total liabilities and stockholders’ equity				$	6,768,813					$	6,836,899

See accompanying notes to condensed consolidated financial statements.

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AMERICAN CLAIMS EVALUATION, INC. AND SUBSIDIARY

Condensed Consolidated Statements of Operations
(Unaudited)

			Three months ended
			June 30, 2007						June 30, 2006
Revenues				$	187,276					$	247,534
Cost of services					90,796						120,386
Gross margin					96,480						127,148
Selling, general, and administrative expenses					553,636						270,964
Operating loss					(457,156	)					(143,816	)
Interest income					90,267						89,228
Net loss				$	(366,889	)				$	(54,588	)
Net loss per share – basic and diluted				$	(0.08	)				$	(0.01	)
Weighted average shares – basic and diluted					4,761,800						4,761,800

See accompanying notes to condensed consolidated financial statements.

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AMERICAN CLAIMS EVALUATION, INC. AND SUBSIDIARY

Condensed Consolidated Statements of Cash Flows
(Unaudited)

			Three months ended
			June 30, 2007						June 30, 2006
Cash flows from operating activities:
Net loss				$	(366,889	)				$	(54,588	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation					5,988						2,907
Stock compensation expense					285,000						—
Changes in assets and liabilities:
Accounts receivable					(11,895	)					(4,763	)
Prepaid expenses					6,216						(9,968	)
Accounts payable					4,966						6,255
Accrued expenses					8,837						5,654
					299,112						85
Net cash used in operating activities					(67,777	)					(54,503	)
Cash flows from investing activities:
Capital expenditures					(39,055	)					—
Net cash used in investing activities					(39,055	)					—
Net decrease in cash and cash equivalents					(106,832	)					(54,503	)
Cash and cash equivalents – beginning of period					6,647,267						6,939,798
Cash and cash equivalents – end of period				$	6,540,435					$	6,885,295

See accompanying notes to condensed consolidated financial statements.

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AMERICAN CLAIMS EVALUATION, INC. AND SUBSIDIARY

Notes to Condensed Consolidated Financial Statements
(Unaudited)

General

The accompanying unaudited consolidated financial statements and footnotes have been condensed and therefore do not contain all disclosures required by accounting principles generally accepted in the United States of America. In the opinion of management, the information furnished reflects all adjustments, consisting of normal recurring adjustments, necessary to make the consolidated financial position, results of operations and cash flows for the interim periods not misleading. Interim periods are not necessarily indicative of results for a full year.

These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements of the Company for the fiscal year ended March 31, 2007 and the notes thereto contained in the Company’s Annual Report on Form 10-KSB, as filed with the Securities and Exchange Commission.

Net Loss Per Share

Basic earnings per share are computed on the weighted average common shares outstanding. Diluted earnings per share reflects the maximum dilution from potential common shares issuable pursuant to the exercise of stock options, if dilutive, outstanding during each period. Potentially dilutive securities consisting of employee stock options to purchase 1,236,000 shares as of June 30, 2007 and 2006 were not included in the diluted net loss per share calculations because their effect would have been anti-dilutive.

Stock Option Plans

Effective January 1, 2006, the Company adopted the provisions of Statement of Financial Accounting Standards No. 123 (revised 2004), Share-Based Payment (‘‘SFAS 123R’’). Under these provisions, stock-based compensation is measured at the grant date, based on the calculated fair value of the award, and is recognized as an expense over the recipient’s requisite service period (generally the vesting period of the grant).

The Company recognized stock-based compensation totaling $285,000 during the three months ended June 30, 2007 based on the fair value of stock options granted. This expense is included in selling, general and administrative expenses in the Consolidated Statements of Operations. At June 30, 2007, all outstanding options to purchase shares are fully vested. However, certain option grants contain disposition restrictions which prohibit the sale of 50% of the shares obtained through the exercise of such awarded options until the first anniversary of the grant date and the remaining 50% of the shares obtained through the exercise of the awarded options until the second anniversary of the grant date.

The Company estimates the fair value of stock options granted using the Black-Scholes option pricing model. Under this method, the weighted average fair value of stock options granted during the three months ended June 30, 2007 was $0.95. In addition to the exercise price of the awards, certain weighted average assumptions were used to estimate the fair value of stock option grants as follows: expected volatility of 47.6%, expected dividend yield of 0%, risk – free interest rate of 5.05% and an expected option term of 5 years.

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The following table summarizes information about stock option activity for the three months ended June 30, 2007:

			Shares						Weighted Average Exercise Price						Weighted Average Remaining Contractual Term			Aggregate Intrinsic Value
Outstanding at March 31, 2007					1,236,000					$	1.95				4.6 years
Granted					300,000					$	1.97				10 years
Expired					(300,000	)				$	1.25				—
Outstanding at June 30, 2007					1,236,000					$	2.12				6.8 years				$	1,500
Exercisable at June 30, 2007					1,236,000					$	2.12				6.8 years				$	1,500

The aggregate intrinsic value represents the total pre-tax intrinsic value, based on options with an exercise price less than the closing price of the Company’s shares of $1.75 as of June 30, 2007, which would have been received by the option holders had these option holders exercised their options as of that date.

At June 30, 2007, there was no unrecognized compensation cost related to non-vested stock option awards.

Item 2.    Management’s Discussion and Analysis or Plan of Operation.

Critical Accounting Policies

The Company makes estimates and assumptions in the preparation of its consolidated financial statements in conformity with accounting principles generally accepted in the United States of America. Actual results could differ significantly from those estimates under different assumptions and conditions. Our significant accounting policies are described in Note 1 to the audited consolidated financial statements included in our Annual Report on Form 10-KSB for the fiscal year ended March 31, 2007. The accounting policies used in preparing our interim condensed consolidated financial statements are the same as those described in such Annual Report.

Results of Operations — Three Months ended June 30, 2007 and 2006

Revenues for the quarterly period ended June 30, 2007 were $187,276, a decrease of 24.3% from the $247,534 reported for the three month period ended June 30, 2006. This decrease is attributable to two factors. In the prior fiscal year, the Company lost the services of its highest producing consultant due to medical reasons during the second fiscal quarter. Accordingly, the revenue reported for the three months ended June 30, 2006 had not yet been affected by this event. In addition, the Company ceased providing services under a community access program contract during the three month period ended June 30, 2007.

Cost of services as a percentage of revenues for the three month periods ended June 30, 2007 and 2006 remained consistent at 48.5% and 48.6%, respectively.

Selling, general and administrative expenses for the quarter ended June 30, 2007 increased to $553,636 from $270,964 for the three months ended June 30, 2006. This increase was the result of stock based compensation expense of $285,000 recorded in accordance with the provisions of SFAS 123R for stock options granted during the three months ended June 30, 2007.

Interest income for the three months ended June 30, 2007 increased slightly to $90,267 from the $89,228 recorded during the three months ended June 30, 2006.

Liquidity and Capital Resources

At June 30, 2007, the Company had working capital of $6,514,035 as compared to working capital of $6,628,991 at March 31, 2007. The Company believes that it has sufficient cash resources and working capital to meet its present cash requirements.

7

During the three months ended June 30, 2007, net cash used in operations of $67,777 consisted principally of a net loss of $366,889 offset by stock based compensation expense of $285,000.

The Company used $39,005 in its investing activities to purchase an automobile for use by its Chief Financial Officer during the quarter ended June 30, 2007.

Minimum lease payments under non-cancelable leases and subleases, exclusive of future escalation charges, for the remainder of fiscal 2008 and fiscal years ending thereafter are as follows:

2008				$	62,000
2009					51,000
2010					41,000
2011					42,000
2012					29,000
Total minimum lease payments				$	225,000

The Company continues its review of strategic alternatives for maximizing shareholder value. Potential acquisitions will be evaluated based on their merits within the Company’s current line of business, as well as other fields.

Off-Balance Sheet Arrangements

The Company has no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the Company’s financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to the Company.

Market Risk

The Company is exposed to market risk related to changes in interest rates. Most of the Company’s cash and cash equivalents are invested at variable rates of interest and decreases in market interest rates would cause a related reduction in interest income.

Forward Looking Statements

Except for the historical information contained herein, the matters discussed in this Report on Form 10-QSB may contain forward-looking statements that involve risks and uncertainties. The Company’s actual results may differ materially from the results discussed in the forward-looking statements. Factors that might cause such a difference include, but are not limited to, general economic and market conditions, the potential loss or termination of existing clients and contracts and the ability of the Company to successfully identify and thereafter consummate one or more acquisitions.

Item 3.    Controls and Procedures.

(a)    Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures are designed to ensure the reliability of the financial statements and other disclosures included in this Report. As of the end of the fiscal quarter ended June 30, 2007, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures pursuant to Rule 13a-15 under the Securities Exchange Act of 1934, as amended. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective in timely alerting them to material information required to be included in the Company’s periodic Securities and Exchange Commission filings.

8

(b)    Changes in Internal Controls

There have been no changes in the Company’s internal controls over financial reporting or in other factors that could significantly affect the internal controls over financial reporting subsequent to the date of the Company’s evaluation in connection with the preparation of this Form 10-QSB.

Management is aware that there is a lack of segregation of duties due to the small number of employees dealing with general administrative and financial matters. However, management has decided that considering the employees involved and the control procedures in place, risks associated with such lack of segregation are insignificant and the potential benefits of adding employees to clearly segregate duties do not justify the expenses associated with such increases.

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PART II — OTHER INFORMATION

Item 6.    Exhibits.

Exhibit 31.1			Section 302 Principal Executive Officer Certification
Exhibit 31.2			Section 302 Principal Financial Officer Certification
Exhibit 32.1			Section 1350 Certification
Exhibit 32.2			Section 1350 Certification

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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.

AMERICAN CLAIMS EVALUATION, INC.

Date: August 9, 2007			By:			/s/ Gary Gelman
						Gary Gelman Chairman of the Board, President and Chief Executive Officer

Date: August 9, 2007			By:			/s/ Gary J. Knauer
						Gary J. Knauer Chief Financial Officer, Treasurer and Secretary

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