10QSB 1 q0303.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2003 OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 33-4882-D CLANCY SYSTEMS INTERNATIONAL, INC. (Exact name of Registrant as specified in its charter) Colorado 84-1027964 (State or other jurisdiction of (IRS Employer Identification incorporation or organization) Number) 2250 S. Oneida #308, Denver, Colorado 80224 (Address of principal executive offices and Zip Code) (303) 753-0197 (Registrant's telephone number) N/A (Former name, former address and former fiscal year, if changed since last report) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such Mr. 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 APPLICABLE ONLY TO CORPORATE ISSUERS: The number of shares outstanding of the issuer's classes of common stock, as of February 12, 2003 is 365,117,938 shares, $.0001 par value. CLANCY SYSTEMS INTERNATIONAL, INC. INDEX Page No. PART I. FINANCIAL INFORMATION Consolidtated Balance Sheet - September 30, 2002 and December 31, 2002 (unaudited) 2 and 3 Consolidated Statement of Income - For the Three Months Ended December 31, 2001 and 2002 (unaudited) 4 Consolidated Statement of Stockholders' Equity - For the Three Months Ended December 31, 2002 (unaudited) 5 Consolidated Statement of Cash Flows - For the Three Months Ended December 31, 2001 and 2002 (unaudited) 6 Notes to Unaudited Consolidated Financial Statements 7 Management's Discussion and Analysis of Financial Condition and Results of Operations 9 PART II. OTHER INFORMATION Item 1. Legal Proceedings 12 Item 2. Changes in Securities and Use of Proceeds 13 Item 3. Controls and Procedures 13 Item 6. Exhibits and Reports and Form 8-K 13 1 CLANCY SYSTEMS INTERNATIONAL, INC. CONSOLIDATED BALANCE SHEETS September 30, 2002 and March 31, 2003 (unaudited) ASSETS September March Current assets: --------- ------ Cash, including interest bearing accounts $ 357,315 $ 523,486 Accounts receivable 339,599 482,742 Income tax refund receivable 35,063 - Inventories (Note 2) 148,517 127,070 Prepaid expenses 138,141 33,316 ---------- ---------- Total current assets 1,018,635 1,166,614 Furniture and equipment, at cost: Office furniture and equipment 259,595 200,562 Equipment under service contracts 1,893,995 2,538,830 Leasehold improvements 105,259 96,166 Equipment and vehicles under capital leases 356,745 195,517 ---------- --------- 2,615,594 3,031,075 Less accumulated depreciation (1,170,030) (1,350,373) ---------- --------- Net furniture and equipment 1,445,564 1,680,702 Other assets: Deferred tax asset (Note 3) 38,200 12,100 Deposits and other 20,640 119,599 Goodwill 225,214 225,214 Software development costs, net of accumulated amortization 150,193 164,389 ---------- ---------- Total other assets 434,247 521,302 ---------- ---------- $ 2,898,446 $ 3,368,618 =========== =========== See accompanying notes. 2 CLANCY SYSTEMS INTERNATIONAL, INC. CONSOLIDATED BALANCE SHEETS September 30, 2002 and March 31, 2003 (unaudited) LIABILITIES AND STOCKHOLDERS' EQUITY September March Current liabilities: --------- ----- Accounts payable $ 141,092 $ 186,762 Accrued expenses 166,159 265,238 Income taxes payable - 34,162 Current portion of long term debt 111,111 115,528 Current portion of obligations under capital leases 132,279 89,465 Deferred revenue 110,722 116,457 ----------- -------- Total current liabilities 661,363 807,612 Long-term debt, net of current portions 182,824 415,441 Obligations under capital leases, net of current portion 53,423 56,033 Minority interest in subsidiary 142,769 139,862 Commitments Stockholders' equity: Preferred stock, $.0001 par value; - - 100,000,000 shares authorized, Common stock, $.0001 par value; 800,000,000 shares authorized, 365,117,938 shares issued and outstanding 36,512 36,512 Additional paid-in capital 1,151,547 1,151,547 Retained earnings 670,008 761,611 ---------- ---------- Total stockholder's equity 1,858,067 1,949,670 ---------- ---------- $ 2,898,446 $ 3,368,618 ============ ============ See accompanying notes. 3 CLANCY SYSTEMS INTERNATIONAL, INC. CONSOLIDATED STATEMENTS OF OPERATIONS For the three months ended March 31, 2002 and 2003 (unaudited) March March 2002 2003 ----- ----- Revenues: Sales $ 49,358 $ 30,892 Service contract income 345,656 639,873 Parking ticket collections 32,593 76,134 ---------- ----------- Total revenues 427,607 746,899 Costs and expenses: Cost of sales 13,055 22,001 Cost of services 133,973 202,223 Cost of parking ticket collections 25,401 29,176 General and administrative 191,522 475,501 Research and development 12,122 8,117 ---------- ---------- Total costs and expenses 376,073 737,018 ---------- ---------- Income from operations 51,534 9,881 Other income (expense): Gain (loss) on disposal of assets - 43 Interest income 724 333 Interest expense - (11,128) Minority interest in loss of subsidiary - 6,756 ---------- ---------- Total other income (expense) 724 (3,996) ---------- ---------- Income before provision for income taxes and loss in equity-basis partnership 52,258 5,885 Provision (benefit)for income taxes: Current expense (benefit) 15,310 (10,969) Deferred expense 4,500 13,050 ---------- ---------- Total income tax expense 19,810 2,081 ---------- ---------- Loss in equity basis partnership (net of tax expense of $40 - 2002) 67 - ---------- ----------- Net income $ 32,515 $ 3,804 ========== ========== Basic net income per common share $ * $ * ========== ========== Weighted average number of shares outstanding 361,600,000 365,118,000 =========== ========== *Less than $.01 per share See accompanying notes. 4 CLANCY SYSTEMS INTERNATIONAL, INC. CONSOLIDATED STATEMENTS OF OPERATIONS For the six months ended March 31, 2002 and 2003 (unaudited) March March 2002 2003 ----- ----- Revenues: Sales $ 88,753 $ 71,667 Service contract income 687,975 1,261,324 Parking ticket collections 53,823 114,420 ---------- ----------- Total revenues 830,551 1,447,411 Costs and expenses: Cost of sales 47,593 42,444 Cost of services 248,211 324,319 Cost of parking ticket collections 51,675 64,864 General and administrative 372,930 814,429 Research and development 26,245 17,042 --------- ----------- Total costs and expenses 746,654 1,263,098 --------- ----------- Income from operations 83,897 184,313 Other income (expense): Loss on disposal of assets - (17,719) Interest income 1,675 881 Interest expense - (22,635) Minority interest in loss of subsidiary - 2,907 --------- ---------- Total other income (expense) 1,675 (36,566) --------- ---------- Income before provision for income taxes and loss in equity-basis partnership 85,572 147,747 Provision for income taxes: Current expense 25,355 30,044 Deferred expense 9,000 26,100 --------- ---------- Total income tax expense 34,355 56,144 --------- ---------- Loss in equity basis partnership (net of tax benefit of $2,896 - 2002) (4,724) - --------- ---------- Net income $ 46,493 $ 91,603 =========== =========== Basic net income per common share $ * $ * =========== ============ Weighted average number of shares outstanding 361,600,000 365,118,000 =========== ============ *Less than $.01 per share See accompanying notes. 5 CLANCY SYSTEMS INTERNATIONAL, INC. CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY For the six months ended March 31, 2003 (Unaudited)
Additional Common Stock Paid-In Retained Shares Amount Capital Earnings ------ ------ ------- -------- Balance, September 30, 2002 365,117,938 $ 36,512 $ 1,151,547 $ 670,008 Net income for the six months ended March 31, 2003 - - - 91,603 ------------ ----------- ------------ ------------- Balance, March 31, 2003 365,117,938 $ 36,512 $ 1,151,547 $ 761,611 ============ ========== ============ ===========
See accompanying notes. 6 CLANCY SYSTEMS INTERNATIONAL, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS For the six months ended March 31, 2002 and 2003 (unaudited) March 31, March 31, 2002 2003 -------- -------- Cash flows from operating activities: Net income $ 46,493 $ 91,603 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 97,458 247,537 Deferred income tax expense 9,000 26,100 Minority interest - (2,907) Changes in assets and liabilities: Investment in equity-basis partnership 7,620 - Accounts receivable 33,499 (143,143) Inventories (3,825) 21,447 Income taxes refundable 12,015 35,063 Prepaid expenses (93,705) 45,700 Accounts payable (16,008) 45,670 Accrued expenses - 99,077 Income taxes payable - 34,162 Deferred revenue (35,708) 5,735 ---------- ---------- Total adjustments 10,346 414,441 ---------- ---------- Net cash provided by operating activities 56,839 506,044 ---------- ---------- Cash flows from investing activities: Acquisition of furniture and equipment (81,028) (451,997) Increase in software licenses and software development costs (28,761) (43,585) Decrease (increase) in deposits and other assets 70 (41,122) --------- ---------- Net cash used in investing activities (109,719) (536,703) --------- --------- Cash flows from financing activities: Borrowings on notes payable and capital leases - 282,619 Payments on notes payable and capital leases - (85,789) --------- ---------- Net cash provided by financing activities - 196,830 --------- ---------- Increase (decrease) in cash and cash equivalents (52,880) 166,171 Cash and cash equivalents at beginning of period 385,491 357,315 ---------- ---------- Cash and cash equivalents at end of period $ 332,611 $ 523,486 ========== ============ See accompanying notes. 7 CLANCY SYSTEMS INTERNATIONAL, INC. NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2003 1. Basis of presentation The accompanying financial statements have been prepared by the Company, without audit. In the opinion of management, the accompanying unaudited financial statements contain all adjustments (consisting of only normal recurring accruals) necessary for a fair presentation of the financial position as of September 30, 2002 and March 31, 2003, and the results of operations and cash flows for the periods ended March 31, 2002 and 2003. As a result of the July 2002 settlement agreement with the principals of UTS (Urban Transit Solutions) we have changed the reporting method for the Company's 60% ownership in UTS from the equity method of accounting to presenting the information on a consolidated basis. The difference in presentation between the equity method of accounting and on a consolidated basis is significant. For, fiscal year ended 2002, Clancy presented its investment in UTS as a single line item "investment in partnership" on the balance sheet and as a single line item on the statement of operations. For fiscal year ending 2003,the consolidated financial statements combine each line item on the balance sheet and statement of operations of Clancy with those of UTS. 2. Inventories Inventories consist of the following at: September 30, March 31, 2002 2003 ---------- --------- Finished goods $ 22,272 $ 30,620 Work in process 4,795 45,388 Purchased parts and supplies 121,450 51,062 ----------- ----------- $ 148,517 $ 127,070 ============ =========== 3. Income taxes The provision for income taxes for the three and six months ended March 31, 2002 and 2003 are based on the expected tax rate for the year. As of September 30, 2002 and December 31, 2002, total deferred tax assets and liabilities are as follows: September 30, March 31, 2002 2003 ------------ --------- Deferred tax assets $ 87,700 $ 109,700 Deferred tax liabilities (49,500) (97,600) ----------- --------- $ 38,200 $ 12,100 =========== ========== 8 CLANCY SYSTEMS INTERNATIONAL, INC. NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2003 4. Investment in UTS Pro Forma consolidated financial information for the three and six months ended March 31, 2003 are as follows: Pro Forma consolidated For three For six months ended months ended statement of operations March 31, 2003 March 31, 2003 -------------- -------------- Total revenues $ 691,394 $ 1,377,178 Total costs and expenses (658,878) (1,330,685) ------------- ------------- Net income $ 32,515 $ 46,493 ============= ============= 9 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Critical Accounting Policies: The Company has identified the accounting policies described below as critical to its business operations and the understanding of the Company's results of operations. The impact and any associated risks related to these policies on the Company's business operations is discussed throughout this section where such policies affect the Company's reported and expected financial results. The preparation of this Quarterly Report requires the Company to make estimates and assumptions that affect the reported amount of assets and liabilities of the Company, revenues and expenses of the Company during the reporting period and contingent assets and liabilities as of the date of the Company's financial statements. There can be no assurance that the actual results will not differ from those estimates. Revenue Recognition: Revenue derived from professional service contracts on equipment and support services is included in income as earned over the contract term; related costs consist mainly of depreciation, supplies and sales commissions. The Company defers revenue for equipment and services under service contracts that are billed to customers on a quarterly, semi-annual, annual or other basis. Revenue from the issuance of parking tickets is recognized on a cash basis when received. Revenue derived from professional service contracts on parking meter and lots fees collections is recognized on a cash basis when received. Related costs consist mainly of Municipalities' fees, depreciation and lots rents. Computer software: Costs incurred to establish the technological feasibility of computer software are research and development costs, which are charged to expense as incurred. Software development costs incurred subsequent to establishment of technological feasibility are capitalized and subsequently amortized based on the greater of the straight line method over the remaining estimated economic life of the product (generally five years) or the estimate of current and future revenues for the related software product. 10 Good Will On January 1, 2002, the Company adopted Statement of Financial Accounting Standards No. 142 (SFAS 142), Goodwill and Intangible Assets, which clarifies the accounting for goodwill and intangible assets. Under SFAS 142, goodwill and intangible assets with indefinitive lives will no longer be amortized, but will be tested for impairment annually and also in the event of an impairment indicator. Material Changes in Financial Condition At March 31, 2003 the Company had working capital of $359,004 derived primarily from contract sales and contract service, as compared to working capital of $357,272 at September 30, 2002. The Company anticipates that working capital will be sufficient to meet its working capital requirements for the current year. Funds will continue to be used for general and administrative purposes, equipment purchases, equipment manufacturing, travel, marketing and research and development. Material Changes in Results of Operations During the quarter ended March 31,2003, the Company generated revenues from contract sales from its professional services contracts, sales, remit-online payment processing, privatization contract, and meter operations in Puerto Rico. New contracts signed during the quarter included Central Parking Mobile, AL; Central Parking Durham, NC; and Central Parking, Cincinnati, OH. Consolidated revenues during the quarter were higher than the prior year's quarter by 75%. Consolidated expenses increased by 94% over the prior year's quarter. The Company reported a profit of $3,804 ($20,691 for Clancy directly and a loss of $16,887 for UTS)for the quarter as compared to a net profit of $ 32,515 for the prior year's quarter. The consolidated revenues are $746,899 ($487,469 for Clancy directly, up 14% from the prior year's quarter, and $259,430 for UTS). The consolidated expenses are reported as $737,018 ($471,786 for Clancy directly, 25% from the prior year's quarter and $265,232 for UTS). Long term debt, capital lease, and interest expenses are attributed to the obligations of UTS. Clancy directly has no outstanding debt. During the six months ended March 31, 2003, consolidated revenues of $1,453,036 were higher than the prior year's period by 74%. The Company reported a profit of $91,603 ($98,872 for Clancy directly and a loss of $7,269 for UTS)for the six months as compared to a net profit of $46,493 for the prior year's period. The consolidated revenues are reported as $1,453,036 ($943,821 for Clancy directly, up 14% from the prior year's period, and $503,590 for UTS). The consolidated expenses are reported as $1,263,098 ($792,593 for Clancy directly, up 6% from the prior year's period and $470,505 for UTS). General and administrative expenses increased 148% for the quarter and 118% for the six months ended March 31, 2003 due to the following activities for Clancy: legal expenses paid during the quarter, increased travel expenses, increased customer supply expenses (ticket forms and envelopes), a monthly retainer fee to a consultant who works 11 for Clancy as a liaison directly with UTS. Expense increases directly related to UTS include payment of a monthly retainer to the Clancy-UTS liaison, infrastructure expenses related to meter installations and general operational expenses. Forward Looking Information Statements of the Company's or management's intentions, beliefs, anticipations, expectations and similar expressions concerning future events contained in this document constitute "forward looking statements" as defined in the Private Securities Litigation Reform Act of 1995. As with any future event, there can be no assurance that the events described in the forward looking statements made in this report will occur or that the results of future events will not vary materially from those described in the forward looking statements in this document. Important factors that could cause the Company's actual performance and operating results to differ materially from the forward looking statements include, but are not limited to, (i) the ability of the Company to obtain new customers, (ii) the ability of the Company to obtain sufficient financing for business opportunities, (iii) the ability of the Company to reduce costs and thereby maintain adequate profit margins. Chat Room Disclaimer This forum of exposure to publicly traded companies presents a venue for the public to inquire about companies from other individuals as well as post opinions. The Company has no way to regulate postings nor monitor information posed on these boards. Management can only provide accurate information to shareholders and potential shareholders when contacted directly and such information can only be provided when it is based on fact and has been filed as required by law with the Securities and Exchange Commission and other regulatory agencies. PART II - OTHER INFORMATION Item 1. Legal Proceedings On September 19, 2000, the Company filed an action in Suffolk County Superior Court against Mr. John Mr. Short, Syracuse, New York, who posted as Darth4, MrDarth4, and other aliases on Raging Bull and other message boards. Relief sought includes monetary damages for harm done to the Company and its officers in an amount not yet determined, retraction of false and damaging statements and for the subject to cease and desist posting or discussing the Company, its officers, and any activities related thereto. In a judgment rendered by the Superior Court Department of the Trial Court of Suffolk County, a default judgment against Mr. Short was entered on October 31, 2001. The Judgment orders Mr. Short to pay the Company attorney's fees and costs of $16,699 and an additional fine of $50,000 for his willful failure to comply with a Court order of June 28, 2001. On November 19, 2002 Short filed a Motion for Relief of Default Judgment. The motion was denied on December 13, 2002. On December 20,2002, Short filed a Notice of Appeal from Order 12 Denying Motion for Relief from Default Judgment. This appeal is still pending. On January 23, 2003, Short filed an Emergency Motion for Stay of Execution of Judgment Pending Appeal from Order Denying Motion for Relief from Default Judgment. On February 6, 2003 this Motion was denied. Item 2. Changes in Securities and Use of Proceeds None Item 3. Controls and Procedures An evaluation was performed 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 within 180 days before the filing date of this quarterly report. Based on that evaluation, the Company's management, including the CEO and CFO, concluded that the Company's disclosure controls and procedures were effective. There have been no significant changes in the Company's internal controls or in other factors that could significantly affect internal controls subject to their evaluation. Item 6. Exhibits and Reports on Form 8-K Section 302 Certification by Chief Executive Officer Section 302 Certification by Chief Financial Officer Exhibit 99.1 Section 906 Certification by Chief Executive Officer Exhibit 99.2 Section 906 Certification by Chief Financial Officer Filed herewith. 13 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. Date: May 15, 2003 CLANCY SYSTEMS INTERNATIONAL, INC. (Registrant) By: /s/ Stanley J. Wolfson Stanley J. Wolfson, President and Chief Executive Officer 14 Section 302 Certification Quarterly Report on Form 10-QSB I, Stanley J. Wolfson, certify that: 1. I have reviewed this quarterly report on Form 10-QSB of Clancy Systems International, Inc.; 2. Based on my knowledge, this quarterly 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 quarterly report; 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly 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 quarterly report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have: a) designed such disclosure controls and procedures 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 quarterly report is being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function): a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and 15 6. The registrant's other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Date: May 15, 2003 /s/Stanley J. Wolfson Chief Executive Officer 16 Section 302 Certification Quarterly Report on Form 10-QSB I, Lizabeth M. Wolfson, certify that: 1. I have reviewed this quarterly report on Form 10-QSB of Clancy Systems International, Inc.; 2. Based on my knowledge, this quarterly 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 quarterly report; 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly 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 quarterly report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have: a) designed such disclosure controls and procedures 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 quarterly reporto78is being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function): a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and 17 6. The registrant's other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Date: May 15, 2003 /s/Lizabeth M. Wolfson Chief Financial Officer 18 Exhibit 99.1 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 Clancy Systems International, Inc. (the "Company") on Form 10-QSB for the period ended March 31, 2003 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Stanley J. Wolfson, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to 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/ Stanley J. Wolfson _______________________ Chief Executive Officer May 15, 2003 19 Exhibit 99.2 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 Clancy Systems International, Inc. (the "Company") on Form 10-QSB for the period ended March 31 2003 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Lizabeth M. Wolfson, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to 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/ Lizabeth M. Wolfson _______________________ Chief Financial Officer May 15, 2003 20