10QSB

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, 2007

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 005-79737

AVP, INC.

(Exact name of registrant as specified in its charter)

Delaware	98-0142664
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

6100 Center Drive, Suite 900, Los Angeles, CA 90045

(Address of principal executive offices - Zip code)

(310) 426 - 8000

(Registrant's telephone number, including area code)

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 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 |X| No |_|

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

Yes |_| No |X|

As of May 10, 2007, the Registrant had 19,824,539 shares of common stock outstanding.

Traditional Small Business Disclosure Format (check one): Yes |X| No |_|

AVP, INC.

	Page
PART I.FINANCIAL INFORMATION	3
ITEM 1.FINANCIAL STATEMENTS	3
Consolidated Balance Sheets as of March 31, 2007
(Unaudited) and December 31, 2006	4
Consolidated Statements of Operations for
the three months ended March 31, 2007 and 2006
(Unaudited)	5
Consolidated Statement of Changes in Stockholders' Equity
for the three months ended March 31, 2007
(Unaudited)	6
Consolidated Statements of Cash Flows for
the three months ended March 31, 2007 and 2006
(Unaudited)	7
Notes to Consolidated Financial Statements (Unaudited)	8
ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS OR
PLAN OF OPERATION	18
ITEM 3.CONTROLS AND PROCEDURES	25
PART II.OTHER INFORMATION
ITEM 6.EXHIBITS AND REPORTS ON FORM 8-K	26

2

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

AVP, INC.

Index to Financial Statements

Period Ended March 31, 2007

	PAGE
Financial Statements
Consolidated Balance Sheets as of March 31, 2007
(Unaudited) and December 31, 2006	4
Consolidated Statements of Operations for
the three months ended March 31, 2007 and 2006
(Unaudited)	5
Consolidated Statement of Changes in Stockholders' Equity
for the three months ended March 31, 2007
(Unaudited)	6
Consolidated Statements of Cash Flows for
the three months ended March 31, 2007 and 2006
(Unaudited)	7
Notes to Consolidated Financial Statements (Unaudited)	8

3

AVP, INC.

CONSOLIDATED BALANCE SHEETS

	March 31,			December 31,
	2007			2006
ASSETS	(Unaudited)
CURRENT ASSETS
Cash and cash equivalents	$	7,965,514		$	5,052,636
Accounts receivable, net of allowance for doubtful accounts of $25,193 and $49,232		626,172			2,653,473
Prepaid expenses		889,091			242,007
Other assets - current portion		162,820			301,477
TOTAL CURRENT ASSETS		9,643,597			8,249,593
PROPERTY AND EQUIPMENT, net		453,893			340,054
OTHER ASSETS		87,191			105,373
TOTAL ASSETS	$	10,184,681		$	8,695,020
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable	$	451,813		$	529,331
Accrued expenses		1,288,160			1,049,439
Deferred revenue		4,475,915			1,056,960
TOTAL CURRENT LIABILITIES		6,215,888			2,635,730
NON-CURRENT LIABILITIES		162,499			190,766
TOTAL LIABILITIES		6,378,387			2,826,496
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ EQUITY
Preferred stock, 2,000,000 shares authorized:
Series A convertible preferred stock, $.001 par value, 1,000,000 shares authorized, no shares issued and outstanding		-			-
Series B convertible preferred stock, $.001 par value, 250,000 shares authorized, 69,256 and 69,548 shares issued and outstanding		70			70
Common stock, $.001 par value, 80,000,000 shares authorized, 19,824,539 and 19,751,838 shares issued and outstanding		19,825			19,752
Additional paid-in capital		39,155,971			39,077,065
Accumulated deficit		(35,369,572	)		(33,228,363	)
TOTAL STOCKHOLDERS’ EQUITY		3,806,294			5,868,524
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	10,184,681		$	8,695,020

See notes to financial statements.

4

AVP, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Three Months Ended March 31,
	2007		2006
REVENUE
Sponsorships/Advertising	$	-	$	-
Other		169,000		122,816
TOTAL REVENUE		169,000		122,816
EVENT COST		52,299		-
GROSS PROFIT		116,701		122,816
OPERATING EXPENSES
Sales and Marketing (1)		875,713		502,585

Administrative 1,446,303 1,120,903

TOTAL OPERATING EXPENSES		2,322,016			1,623,488
OPERATING LOSS		(2,205,315	)		(1,500,672	)
OTHER INCOME (EXPENSE)
Interest expense		-			(8,213	)
Interest income		56,457			21,139
Gain on sale of asset		8,449			-
TOTAL OTHER INCOME (EXPENSE)		64,906			12,926
LOSS BEFORE INCOME TAXES		(2,140,409	)		(1,487,746	)
INCOME TAXES		(800	)		(800	)
NET LOSS	$	(2,141,209	)	$	(1,488,546	)
Loss per common share:
Basic	$	(0.11	)	$	(0.12	)
Diluted	$	(0.11	)	$	(0.12	)
Shares used in computing loss per share:
Basic		19,783,309			12,468,848
Diluted		19,783,309			12,468,848

(1) Sales and marketing expenses includes stock based expenses of $72,907 and $0 for the three months ended March 31, 2007 and 2006, respectively.

See notes to financial statements.

5

AVP, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

For The Three Months Ended March 31, 2007

(Unaudited)

	Series A Preferred Stock				Series B Preferred Stock					Common Stock
	Shares		Amount		Shares			Amount		Shares		Amount		Additional Paid-in Capital			Accumulated Deficit			Total Stockholders’ Equity
Balance, December 31, 2006		-	$	-		69,548		$	70		19,751,838	$	19,752	$	39,077,065		$	(33,228,363	)	$	5,868,524
Conversion of Series B Preferred Stock to common stock		-		-		(292	)		-		8,138		8		(8	)		-			-
Cashless exercise of options		-		-		-			-		64,563		65		(65	)		-			-
Issuance of warrants to broker-dealer for services		-		-		-			-		-		-		57,619			-			57,619
Expenses from issuance of employee options		-		-		-			-		-		-		21,360			-			21,360
Net loss		-		-		-			-		-		-		-			(2,141,209	)		(2,141,209	)
Balance, March 31, 2007		-	$	-		69,256		$	70		19,824,539	$	19,825	$	39,155,971		$	(35,369,572	)	$	3,806,294

See notes to financial statements.

6

AVP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Three Months Ended March 31,
	2007			2006
CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES
Net loss	$	(2,141,209	)	$	(1,488,546	)
Adjustments to reconcile net loss to net cash flows from operating activities:
Depreciation of property and equipment		49,571			36,545
Interest income on investment in sales-type lease		-			(12,843	)
Amortization of deferred commissions		72,907			-
Gain on property and equipment		-			(9,864	)
Gain on sale of asset		(8,449	)		-
Other amortization		-			2,011
Compensation from issuance of stock options		21,360			10,726
Decrease (increase) in operating assets:
Accounts receivable		2,027,301			202,903
Prepaid expenses		(647,084	)		(492,067	)
Other assets		-			(3	)
Increase (decrease) in operating liabilities:
Accounts payable		(77,518	)		(414,534	)
Accrued expenses		229,204			(446,058	)
Deferred revenue		3,400,205			2,597,165
NET CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES		2,926,288			(14,565	)
CASH FLOWS PROVIDED BY (USED IN) INVESTING ACTIVITIES
Investment in property and equipment		(163,410	)		(64,216	)
Proceeds from investment in sales-type lease		150,000			92,400
Proceeds from disposal of property and equipment		-			19,665
NET CASH FLOWS PROVIDED BY (USED IN) INVESTING ACTIVITIES		(13,410	)		47,849

CASH FLOWS USED IN FINANCING ACTIVITIES
Debt repayments		-		(416,737	)
NET CASH FLOWS USED IN FINANCING ACTIVITIES		-		(416,737	)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		2,912,878		(383,453	)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD		5,052,636		1,143,345
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	7,965,514	$	759,892
SUPPLEMENTAL DISCLOSURE OF
CASH FLOW INFORMATION
Cash paid during the period for:
Interest	$	-	$	110,447
Income taxes	$	800	$	800
SUPPLEMENTAL DISCLOSURE OF NON-CASH
INVESTING AND FINANCING INFORMATION
Conversion of Series B preferred stock into common stock	$	8	$	-
Payment of accrued registration penalty in common stock	$	-	$	935
Issuance of common stock to non-employees for services	$	-	$	1,000,000
Issuance of warrant to sales agent for services	$	57,619	$	-
Cashless exercise of options	$	65	$	-

See notes to financial statements.

7

AVP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. BASIS OF PRESENTATION

The accompanying unaudited interim consolidated financial statements of AVP, Inc. (“AVP”) have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission ("SEC"), and should be read in conjunction with the audited financial statements and notes thereto contained in AVP’s latest Annual Report on Form 10-KSB filed with the SEC. In the opinion of management, all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of AVP’s financial position and the results of operations for the interim periods presented have been reflected herein. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the consolidated financial statements that would substantially duplicate the disclosures contained in the consolidated audited financial statements for the most recent fiscal year 2006, as reported in the Form 10-KSB as previously filed with the SEC, have been omitted.

2. RESCISSION OFFER

Options granted in 2004 to AVP players under AVP's 2002 Stock Option Plan were not exempt from registration or qualification under federal and state securities laws, and AVP did not obtain the required registrations or qualifications. As a result, AVP commenced a rescission offer to the holders of these options on August 9, 2006. On September 8, 2006, the rescission offer expired. Several players accepted the offer totaling approximately $20,000, including interest expense. AVP may continue to be liable under federal and state securities laws for amounts with respect to which the rescission offer is not accepted.

3. NET LOSS PER BASIC AND DILUTED SHARE OF COMMON STOCK

Basic earnings (loss) per share is calculated using the average number of common shares outstanding. Diluted earnings (loss) per share is computed on the basis of the average number of common shares outstanding during the period increased by the dilutive effect of outstanding stock options using the “treasury stock” method.

The following options, warrants and other incremental shares to purchase shares of common stock were excluded from the computation of diluted earnings (loss) per share available to common shareholders for the periods presented as their effect would be antidilutive.

	Three Months Ending March 31,
	2007		2006
Options and Warrants		18,227,220		15,482,688
Series B Preferred Stock		1,930,165		1,815,404
Total		20,157,385		17,298,092

8

AVP, INC.

NOTES TO CONSOLIDATEDFINANCIAL STATEMENTS

(Unaudited)

4. STOCK BASED COMPENSATION

The Company accounts for stock-based compensation in accordance with the provisions of SFAS No. 123 (Revised 2004), Share-Based Payment (SFAS No. 123R). Under the fair value recognition provisions of SFAS No. 123R, stock-based compensation cost is estimated at the grant date based on the fair value of the award. The fair value of stock options granted is estimated using the Black-Scholes-Merton option pricing model and a single option award approach. The fair value is amortized on a straight-line basis over the requisite service period of the awards, which is generally the vesting period.

Determining the appropriate fair value of stock-based awards at the grant date requires judgment, including estimating stock price volatility, forfeiture rates and expected term. Forfeitures are estimated at the date of grant based on historical rates and reduce the compensation expense recognized. The expected term of options granted from historical data on employee exercises is not yet determinable. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the date of grant. Expected volatility is based on the historical volatility of the Company’s stock. As of March 31, 2007, the Company had approximately $100,879 of unrecognized compensation expense expected to be recognized over a weighted average period of approximately 1.41 years. Due to the inherent uncertainty in valuing awards for publicly-traded stock as of the grant date, given that such awards will be exercised, purchased or sold at indeterminate future dates, the actual value realized by the recipients, if any, may vary significantly from the value of the awards estimated at the grant date.

	Three Months Ended March 31,
	2007
Risk-free interest rate	4.54%
Expected life	3 years
Expected volatility	84%
Expected forfeiture rate	0%
Expected dividend yield	0%

9

AVP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

5. STOCK OPTIONS

Stock Option Plans

On August 23, 2005, the stockholders approved the adoption of the 2005 Stock Incentive Plan. Under the 2005 Plan, AVP may grant awards of stock options (including stock purchase warrants) and restricted stock grants to its officers, directors, employees, consultants, players, and independent contractors. AVP may issue an aggregate of 30,000,000 shares of its common stock under the 2005 Plan, including approximately 14,000,000 shares consisting of management warrants, as well as options previously granted by the Association which were subsequently converted to AVP stock options pursuant to the Merger Agreement. AVP may grant both incentive stock options intended to qualify under Section 422 of the Internal Revenue Code, and options, warrants, and other rights to buy AVP’s common stock that are not qualified as incentive stock options. No stock options may be granted at an exercise price less than the fair market value of our common stock on the date of grant. The exercise price of each optioned share is determined by the Compensation Committee; however the exercise price for incentive stock options and nonqualified stock options will not be less than 100% of the fair market value of the optioned shares on the date of grant. The exercise price of incentive stock options granted to holders of more than 10% of AVP’s Common Stock must be at least 110% of the fair market value of the Common Stock on the date of grant.

The expiration date of each option shall be determined by the Committee at the date of grant; however, in no circumstances shall the option be exercisable after 10 years from the date of grant. Stock options granted under the 2005 Plan will expire no more than ten years from the date on which the option is granted, unless the Board of Directors determines an alternative termination date. If incentive stock options are granted to holders of more than 10% of AVP’s Common Stock, such options will expire no more than five (5) years from the date the option is granted. Except as otherwise determined by the Board of Directors or the Compensation Committee, stock options granted under the 2005 Plan will vest and become exercisable on the anniversaries of the date of grant of such option at a rate of 25% per year over four years from the date of grant.

The following table contains information on the stock options under the Plan for the period ended March 31, 2007 and the year ended December 31, 2006. The outstanding options expire from April 2008 to November 2016.

	Number of Shares			Weighted Average Exercise Price
Options outstanding at January 1, 2006		12,015,262		$	0.87
Granted		150,000			0.70
Converted Othnet options		--			--
Exercised		--			--
Cancelled		(87,178	)		1.67
Options outstanding at December 31, 2006		12,078,084			0.86
Granted		--			--
Exercised		(50,977	)		0.01
Cancelled		--			--
Options outstanding at March 31, 2007		12,027,107		$	0.86

10

AVP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

5. STOCK OPTIONS (CONTINUED)

Stock Option Plans (Continued)

The following table summarizes information about AVP’s stock-based compensation plan at March 31, 2007:

Options outstanding and exercisable by price range as of March 31, 2007:

	Options Outstanding						Options Exercisable
Range of Exercise  Prices	Number Outstanding		Weighted Average Remaining Contractual Life in Years		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price
$ .01 -.30		6,067,966		2.8	$	0.03		6,067,966	$	0.03
.31 -.90		1,805,480		6.6		0.77		1,692,877		0.77
.91 -1.60		698,438		2.1		1.60		665,614		1.60
1.61 -2.80		3,455,223		2.3		2.21		3,434,974		2.21
$ .01 -2.80		12,027,107		3.2	$	0.86		11,861,431	$	0.86

In connection with stock options granted to employees to purchase common stock, AVP recorded $21,360 of stock-based compensation expense for the period ended March 31, 2007 and $10,726 for the period ended March 31, 2006.

11

AVP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

5. STOCK OPTIONS (CONTINUED)

Other Stock Options

The following table contains information on all of AVP’s non-plan stock options for the period ended March 31, 2007 and the year ended December 31, 2006.

	Number of Shares			Weighted Average Exercise Price
Options outstanding at January 1, 2006		3,467,425		$	1.89
Granted		4,173,506			1.16
Converted Othnet options		--			--
Exercised		(20,195	)		0.30
Cancelled		(1,403,794	)		1.76
Options outstanding at December 31, 2006		6,216,942			1.44
Granted		--			--
Exercised		(16,829	)		0.30
Cancelled		--			--
Options outstanding at March 31, 2007		6,200,113		$	1.44

The following table summarizes information about AVP’s non-qualified stock options at March 31, 2007:

Options outstanding and exercisable by price range as of March 31, 2007:

	Options Outstanding						Options Exercisable
Range of Exercise Prices	Number Outstanding		Weighted Average Remaining Contractual Life in Years		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price
$ .30 - 1.50		3,262,193		4.0	$	0.91		3,262,193	$	0.91
1.60 - 3.40		2,937,920		2.3		2.03		2,937,920		2.03
$ .30 - 3.40		6,200,113		3.2	$	1.44		6,200,113	$	1.44

In connection with warrants granted to non-employees to purchase common stock, AVP recorded warrant expense of $54,725 in sales and marketing expenses for the period ended March 31, 2007 and $-0- in sales and marketing expenses for the period ended March 31, 2006. Such amounts represent, for each non-employee stock option, the valuation under SFAS 123R on the date of the grant.

12

AVP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

6. COMMITMENTS AND CONTINGENCIES

Operating Lease

The Company leases its corporate office facilities under a non-cancellable operating lease expiring in March 2010. The lease agreement contains a renewal option for an additional five-year term. In addition, the lease agreement provides for rental escalations at defined intervals during the lease term. Rent expense is recognized on the straight-line method over the term of the lease. The difference between rent expense recognized and rent payable under the rental escalation clauses is reflected in accrued expenses.

The Company also subleases approximately 4,500 square feet of warehouse space pursuant to a sublease that expires on February 15, 2008. The space is used for storing tournament equipment and the company’s trucks.

The future minimum rental payments under the non-cancellable operating leases commitment are as follows:

Years Ending December 31,

2007	$	275,080
2008		351,500
2009		357,000
2010		90,000
Total	$	1,073,580

Rent expense for the corporate office facility charged to operations was $79,853 and $78,157 for the three months ended March 31, 2007 and 2006, respectively.

Officer Indemnification

Under the organizational documents, AVP’s directors are indemnified against certain liabilities arising out of the performance of their duties to AVP. AVP also has an insurance policy for its directors and officers to insure them against liabilities arising from the performance of their duties required by their positions with AVP. AVP’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against AVP that have not yet occurred. However, based on experience, AVP expects the risk of loss to be remote.

13

AVP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

7. CAPITAL TRANSACTIONS

In February 2006, AVP entered a production and distribution agreement with Fox Broadcasting Company (“FBC”) in connection with two events. Under the agreement, FBC had the exclusive right to telecast the finals of two 2006 AVP tournaments throughout the U.S., its territories, and possessions. In consideration for its services valued at $1,000,000, FBC received 666,667 shares of common stock, par value $0.001 per share, of AVP.

For the three months ended March 31, 2007, 292 shares of Series "B" preferred stock were converted into 8,138 shares of AVP’s common stock pursuant to notice of conversion from an individual investor.

During the three months ended March 31, 2007, AVP issued 13,945 shares of common stock pursuant to the cashless exercise of options for 16,829 shares of common stock. The exercise price of the options was $0.30 per share.

During the three months ended March 31, 2007, AVP issued 50,618 shares of common stock pursuant to the cashless exercise of options for 50,977 shares of common stock. The exercise price of the options was $0.01 per share.

14

AVP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited) .

8. RECENTLY ISSUED ACCOUNTING STANDARDS

In February 2006, the FASB issued Statement of Financial Accounting Standard No. 155, “Accounting for Certain Hybrid Instruments,” which is an amendment of SFAS No. 133 and 140. SFAS No. 155 allows financial instruments that have embedded derivatives to be accounted for as a whole (eliminating the need to bifurcate the derivative from its host), if the holder elects to account for the whole instrument on a fair value basis. This statement is effective for all financial instruments acquired or issued after the beginning of an entity’s first fiscal year that begins after September 15, 2006. The adoption of this Statement is not expected to have any impact on AVP’s financial position or results of operations.

In March 2006, the FASB issued SFAS No.156, “Accounting for Servicing of Financial Assets - an Amendment of SFAS No.140”. SFAS 156 amends SFAS 140 to clarify the accounting for servicing assets and servicing liabilities. Among other provisions, the new accounting standard requires all separately recognized servicing assets and servicing liabilities to be initially measured at fair value, if practicable. SFAS 156 is effective for the fiscal periods beginning after September 15, 2006. The adoption of SFAS 156 had no material impact on the Company’s financial position, results of operations or cash flows.

In June 2006, the EITF reached a consensus on Issue No. 06-03, “How Taxes Collected from Customers and Remitted to Governmental Authorities Should Be Presented in the Income Statement (That Is, Gross versus Net Presentation)” ( EITF 06-03). EITF 06-03 applies to taxes assessed by a governmental authority that are directly imposed on a revenue-producing transaction between a seller and a customer, and states that the presentation of such taxes on either a gross basis (included in revenues and costs) or on a net basis (excluded from revenues) is an accounting policy decision that should be disclosed. Additionally, for such taxes reported on a gross basis, the amount of such taxes should be disclosed in interim and annual financial statements if the amounts are significant. The provisions of EITF 06-03 are effective for interim and annual reporting periods beginning after December 15, 2006. On January 1, 2007, AVP adopted EITF 06-03. AVP collects certain excise taxes levied by state or local governments. AVP’s excise taxes are accounted for on a gross basis and recorded as revenue. For the three months ended March 31, 2007, there were no taxes levied by state or local governments.

In July 2006, FASB issued FASB Interpretation No. 48 ( FIN 48), “Accounting for Uncertainty in Income Taxes, an interpretation of SFAS No. 109, Accounting for Income Taxes,” which is effective for fiscal years beginning after December 15, 2006, and clarifies the accounting for uncertainty in tax positions. FIN48 requires that we recognize the impact of a tax position in our financial statements if that position is more likely than not of being sustained on audit, based on the technical merits of the position. The cumulative effect of the change in accounting principle is recorded as an adjustment to opening retained earnings. Effective January 1, 2007, the Company adopted FIN 48 with no significant impact on the Company’s financial position or results of operations.

In September 2006, the FASB issued SFAS No. 157, “Fair Value Measures” (SFAS 157). SFAS 157 defines fair value, establishes a framework for measuring fair value and enhances disclosures about fair value measures required under other accounting pronouncements, but does not change existing guidance as to whether or not an instrument is carried at fair value. SFAS No. 157 is effective for fiscal years beginning after November 15, 2007. The adoption of this accounting pronouncement is not expected to have a material effect on the Company’s consolidated financial position, results of operations or cash flows.

15

AVP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited) .

8. RECENTLY ISSUED ACCOUNTING STANDARDS (CONTINUED)

On September 29, 2006, the FASB issued SFAS No. 158, Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans - An Amendment of SFAS No. 87, 88, 106, and 132R. This new standard requires an employer to: (a) recognize in its statement of financial position an asset for a plan’s overfunded status or a liability for a plan’s underfunded status; (b) measure a plan’s assets and its obligations that determine its funded status as of the end of the employer’s fiscal year (with limited exceptions); and (c) recognize changes in the funded status of a defined benefit postretirement plan in the year in which the changes occur. Those changes will be reported in comprehensive income of a business entity and in changes in net assets of a not-for-profit organization. Statement 158 applies to plan sponsors that are public and private companies and nongovernmental not-for-profit organizations. The requirement to recognize the funded status of a benefit plan and the disclosure requirements are effective as of the end of the fiscal year ending after December 15, 2006, for entities with publicly traded equity securities, and at the end of the fiscal year ending after June 15, 2007, for all other entities. The requirement to measure plan assets and benefit obligations as of the date of the employer’s fiscal year-end statement of financial position is effective for fiscal years ending after December 15, 2008.

In September 2006, the Securities and Exchange Commission (“SEC”) released Staff Accounting Bulletin No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements” (“SAB 108”). SAB 108 provides interpretive guidance on the SEC’s views regarding the process of quantifying materiality of financial statement misstatements. SAB 108 is effective for the Company’s fiscal year ending October 31, 2007. The adoption of this accounting pronouncement did not have a material effect on the Company’s consolidated financial position, results of operations or cash flows.

In February 2007, the FASB issued SFAS No. 159, "The Fair Value Option for Financial Assets and Financial Liabilities," ("SFAS 159"). SFAS 159 permits entities to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measure at fair value. Unrealized gains and losses on items for which the fair value option has been elected are reporting in earnings. SFAS 159 does not affect any existing accounting literature that requires certain assets and liabilities to be carried at fair value. SFAS 159 is effective for fiscal years beginning after November 15, 2007. The Company currently does not believe SFAS 159 will have a material impact on its consolidated financial position, results of operations or cash flows.

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AVP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

9.SUBSEQUENT EVENTS

On April 5, 2007, AVP entered into an Agreement and Plan of Merger (the "Merger Agreement") with AVP Holdings, Inc. and AVP Acquisition Corp., affiliates of Shamrock Capital Growth Fund II, L.P. ("Shamrock").  Under the terms of the Merger Agreement, AVP Acquisition Corp. will be merged with and into AVP, with AVP continuing as the surviving corporation.  Upon consummation of the merger, each outstanding share of AVP common stock and Series B preferred stock will be cancelled and converted into the right to receive $1.23 and $33.93, respectively, and AVP will become a wholly owned subsidiary of AVP Holdings, Inc.  The total value of the transaction is approximately $36.9 million.  The transaction, which is expected, but not certain to close in the summer of 2007, is subject to certain customary terms and conditions, including stockholder approval, but is not subject to any financing condition.  If this transaction is completed, AVP will become a privately held company and its common stock will no longer be traded on the OTC Bulletin Board.

In connection with the Merger Agreement, the special committee (“Special Committee”) of the board of directors of AVP, Inc. entered into an agreement dated January 26, 2007, as amended by an amendment dated April 19, 2007 (collectively, the “Jefferies Agreement”) with Jefferies & Company, Inc. (“Jefferies”) under which Jefferies would provide the Special Committee with financial advice and assistance in connection with the Special Committee’s review of a possible sale or other business transaction, including merger, stock purchase, recapitalization, and such, of AVP (a “Transaction”). Pursuant to the Jefferies Agreement, Jefferies will render an opinion as to the fairness of the consideration to be paid to the AVP stockholders in a Transaction. With respect to the Merger Agreement, Jefferies has rendered an opinion as to the aforementioned $1.23 per share. For its services, Jefferies received in accordance with the Jefferies Agreement a non-refundable fee of $250,000 on April 5, 2007 upon delivery of the opinion. In addition, Jefferies is entitled to receive a $500,000 transaction fee upon consummation of a Transaction; provided, however, that if such Transaction is at a price greater than $1.23 per share, Jefferies is entitled to receive in addition to the $500,000 fee, the greater of $250,000 or 5% of the aggregate consideration in excess of $1.23 per share. Finally, AVP will reimburse Jefferies for all out-of-pocket expenses incurred by Jefferies in connection with the engagement.

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Background

We originally incorporated under the name Malone Road Investments, Ltd., on August 6, 1990, in the Isle of Man. We re-domesticated in the Turks and Caicos Islands in 1992 and subsequently domesticated as a Delaware corporation in 1994. Pursuant to Delaware law, we are deemed to have been incorporated in Delaware as of the date of our formation in the Isle of Man. We changed our name to PL Brands, Inc. in 1994; changed our name to Othnet, Inc. in March 2001; and changed our name to AVP, Inc. on March 9, 2005. Since December 2001 until the Merger (as defined below), we had no business operations other than to attempt to locate and consummate a business combination with an operating company.

AVP's Business

We own and operate professional beach volleyball tournaments in the United States. The AVP tour is the sole nationally recognized U.S. professional beach volleyball tour. Every top U.S. men’s and women’s beach volleyball professional, including the women’s gold and bronze medalists in the 2004 Olympic Games, competes on the AVP tour. We have more than 200 of the top professional players under exclusive contracts, as well as a growing base of spectators and television viewers that we believe represent an attractive audience for national, regional, and local sponsors. Our business includes establishing and managing tournaments; sponsorship/advertising sales and sales of broadcast, licensing, and trademark rights; sales of tickets, food, beverage, and merchandise at the tournaments; contracting with players in the tour; and associated activities.

AVP's beach volleyball tournament season customarily commences in early April and continues until late September or early October. For 2007, we scheduled 18 men’s and 18 women’s events in Miami, FL, Dallas, TX, Huntington Beach, Glendale, AZ, Hermosa Beach, CA, Louisville, KY, Tampa, FL, Atlanta, GA, Charleston, SC, Seaside Heights, NJ, Long Beach, CA, Chicago, IL, Manhattan Beach, CA, Boston, MA, Brooklyn, NY, Cincinnati, OH, Las Vegas, NV, San Francisco, CA. Nine of the 18 cities are the same as last year.

AVP Acquisition

On February 28, 2005, Association of Volleyball Professionals, Inc. (the “Association”) and a wholly owned subsidiary of AVP, then known as Othnet, Inc., consummated a merger pursuant to a merger agreement, signed in June 2004, as amended (the “Merger”). As a result of the Merger, the Association became our wholly owned subsidiary, and the Association’s former stockholders (including holders of stock options and stock purchase warrants) beneficially owned 61.2% of all common stock beneficially owned by all beneficial owners of our capital stock. On December 16, 2005, AVP effectuated a 1-for-10 reverse stock split, which is reflected in all share amounts referred to in this report.

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Results of Operations for the three months ended March 31, 2007 and 2006

Revenue

	Three Months Ended March 31,				Percentage  Increase (Decrease)
	2007		2006
Sponsorship/advertising	$	-	$	-		-
Activation Fees		-		-		-
Local Promoter Fees		-		-		-
Local Revenue		-		-		-
Miscellaneous Revenue		169,000		122,816		38	%
Total Revenue	$	169,000	$	122,816		38	%

AVP’s business is seasonal, therefore revenue, gross profit and operating income amounts and percentages for the first and fourth quarters are not representative of our performance. The majority of AVP’s revenues are derived from sponsorship and advertising contracts with national and local sponsors. AVP recognizes sponsorship revenue during the tour, as the events occur and collection is reasonably assured, in the proportion that prize money for an event bears to total prize money for the season. AVP's beach volleyball tournament season customarily commences in early April and continues until late September or early October. As mentioned above, our first and fourth quarters have insignificant revenue, gross profit, and operating income. We did not produce any beach volleyball events in the first quarters of 2007 or 2006. Accordingly, we did not recognize any sponsorship revenue, activation fees, or local revenue in the quarters ended March 31, 2007 and 2006.

The 38% increase in miscellaneous revenue for the three months ended March 31, 2007 reflects trademark licensing revenue earned in connection with Crocs, Inc. for AVP branded footwear and ticket sales for an indoor exhibition event.

Event Costs

Event costs primarily include the direct costs of producing an event, costs related to the airing of events on network television, and the cost of servicing our sponsors. Event costs are recognized on an event-by-event basis and event costs billed and/or paid prior to their respective events are recorded as prepaid event costs and expensed at the time the event occurs.

					% Revenue						Increase
											(Decrease) as
	Three Months Ended March 31,				Three Months Ended March 31,						% of Revenue
	2007		2006		2007			2006			2007 vs. 2006
Event Costs	$	52,299	$	-		31	%		0	%		31	%

For the three months ended March 31, 2007, event costs included costs incurred in connection with an indoor exhibition event that was held in February 2007. There was no sponsorship/advertising revenue for this indoor exhibition event. There was no event taking place during the three months ended March 31, 2006.

19

Gross Profit

	Three Months Ended March 31,
	2007			2006
Revenue	$	169,000		$	122,816
Event Costs		52,299			-
Gross Profit	$	116,701		$	122,816
Gross Profit %		69	%		100	%

The decrease in the gross profit margin is due to the added event costs related to the indoor exhibition event that took place during the three months ended March 31, 2007. There was no event cost for the three months ended March 31, 2006. As mentioned above, AVP’s primary business is seasonal; therefore revenue, gross profit and operating income amounts and percentages for the first and fourth quarters are not representative of our performance.

Operating Expenses

					% Revenue
	Three Months Ended March 31,				Three Months Ended March 31,
	2007		2006		2007			2006
Administrative	$	1,446,303	$	1,120,903		856	%		913	%
Sales and Marketing		875,713		502,585		518	%		409	%
Total Costs	$	2,322,016	$	1,623,488		1374	%		1322	%

The 29% or $0.3 million increase in administrative costs was due to the proposed Merger Agreement.

The 74% or $0.4 million increase in sales and marketing costs primarily reflects the amortization of commission expense paid to external sales agents, marketing consultants, and additional headcount in marketing during the three months ended March 31, 2007.

Depreciation and Amortization Expense
					Percentage
	Three Months Ended March 31,				Increase
	2007		2006		(Decrease)
Depreciation Expense	$	49,571	$	36,545		36	%
Amortization Expense		-		2,011		(100	%)
Total	$	49,571	$	38,556		29	%

Depreciation expense increased 36% as a result of an increase in depreciable assets, including information technology equipment and transportation equipment.

20

Other Income (Expense)
		Three Months Ended March 31,				Percentage
		2007		2006		Increase/(Decrease)
Interest Expense	$	-	$	(8,213	)	(100%)
Interest Income		56,457		21,139		167	%
Gain on disposal of asset		8,449		-		-	%
Total	$	64,906	$	12,926		402	%

The 167% increase in interest income is due to higher interest rates and a higher cash balances realized from the private placement consummated in May and June of 2006.

Operating Loss and Net Loss							% Revenue
	Three Months Ended March 31,						Three Months Ended March 31
	2007			2006			2007			2006
Operating Loss	$	(2,205,315	)	$	(1,500,672	)		(1,305	)%		(1,222	%)
Net Loss		(2,141,209	)		(1,488,546	)		(1,267	)%		(1,212	%)

The Company’s net loss of $2.1 million for the three months ended March 31, 2007 compared to a loss of $1.5 million for the three months ended March 31, 2006 primarily reflects an increase of $ 0.7 million in operating expense that includes costs relating to the proposed Merger Agreement, amortization of commission expenses, and additional headcount in marketing. As mentioned above, AVP’s primary business is seasonal; therefore revenue, gross profit and operating income (loss) amounts and percentages for the first and fourth quarters are not representative of our performance.

Liquidity and Capital Resources

	March 31, 2007			December 31 , 2006			Increase/ (Decrease)
Cash and cash equivalents	$	7,965,514		$	5,052,636		$	2,912,878
Percentage of total assets		78	%		58	%

	Three Months Ended March 31,						Increase/
	2007			2006			(Decrease)
Cash flows provided by (used) in operating activities	$	2,926,288		$	(14,565	)	$	2,940,853
Cash flows provided by (used) in investing activities		(13,410	)		47,849			(61,259	)
Cash flows used in financing activities		-			(416,737	)		416,737

As of March 31, 2007, our primary source of liquidity is comprised of $8.0 million of cash and cash equivalents.  Over the last two years, our primary sources of liquidity have included cash on hand at the beginning of the year, cash flows generated from continuing operations, and cash flow provided by financing activities.  We have generated significant cash flows from the issuance of our common stock through private placements, which are described in more detail below in “Cash Flows Provided by Financing Activities.”

21

We believe that we have sufficient working capital ($3.4 million at March 31, 2007) to finance our operational requirements for at least the next twelve months, including purchases of inventory and equipment and the addition of two more events for the 2007 tour season.

Cash flows provided by operating activities for the three months ended March 31, 2007 were $2.9 million. The increase in cash flows provided by operating activities for the three months ended March 31, 2007 is primarily due to a decrease in accounts receivable and an increase in deferred revenue. Working capital, consisting of current assets less current liabilities, was $3.4 million at March 31, 2007 and $5.6 million at December 31, 2006.

At March 31, 2007 and 2006, accounts receivable decreased $2.0 million and $0.2 million as compared to December 31, 2006 and 2005, respectively.  At March 31, 2007 and 2006, deferred revenues increased $3.4 million and $2.6 million as compared to December 31, 2006 and 2005, respectively.  Deferred revenues are recorded as AVP collects revenues prior to holding certain events. The decrease in accounts receivable and the increase in deferred revenue is the result of improved collections.

Capital expenditures for the three months ended March 31, 2007 and 2006 were $0.2 million and $0.06 million, respectively. During the three months ended March 31, 2007, AVP purchased two trailers and information technology equipment in preparation for the 2007 tour season. During the three months ended March 31, 2006, AVP purchased a scoreboard, a trailer and computer equipment in preparation for the 2006 tour season.

Cash flows used in financing activities for 2007 and 2006 were $0 and $0.4 million, respectively. In February 2006, AVP paid the remaining principal amount due on the promissory note to MPE with whom Leonard Armato, the Chief Executive Officer and Chairman of the Board of Directors of the Company, was affiliated. This note constituted the purchase price delivered by AVP to MPE for the interests in MPE Sponsorship, LLC in connection with sponsorship sales services previously provided by MPE to the Association.

In February 2006, we entered a production and distribution agreement with Fox Broadcasting Company (“FBC”) in connection with two events. Under the agreement, FBC telecast the finals of two 2006 AVP tournaments throughout the U.S., its territories, and possessions. In consideration for its services valued at $1,000,000, FBC received 666,667 shares of common stock, par value $0.001 per share, of AVP.

Critical Accounting Policies

Revenue and Expense Recognition

The majority of AVP’s revenues are derived from sponsorship and advertising contracts with national and local sponsors. AVP recognizes national sponsorship/advertising revenue and activation fees during the tour season, as the events occur and collection is reasonably assured, in the proportion that prize money for an event bears to total prize money for the season. Cash collected before the related events are recorded as deferred revenue. Event costs are recognized on an event-by-event basis. Event costs billed and/or paid before the related events are recorded as deferred costs and expensed at the time the event occurs.

AVP also derives additional revenue from local sponsorships/advertising, promoter fees, event ticket sales, concession rights, event merchandising, and licensing. Revenues and expenses from the foregoing ancillary activities are recognized on an event-by-event basis as the revenues are realized and collection is reasonably assured. Licensing revenue is recognized as royalties are earned and collection is reasonably assured.

Income Taxes

AVP accounts for income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to the differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. 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. A valuation allowance is recorded to reduce deferred taxes to the amount that is more likely than not to be realized.

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Recently Issued Accounting Standards

In February 2006, the FASB issued Statement of Financial Accounting Standard No. 155, “Accounting for Certain Hybrid Instruments,” which is an amendment of SFAS No. 133 and 140. SFAS No. 155 allows financial instruments that have embedded derivatives to be accounted for as a whole (eliminating the need to bifurcate the derivative from its host), if the holder elects to account for the whole instrument on a fair value basis. This statement is effective for all financial instruments acquired or issued after the beginning of an entity’s first fiscal year that begins after September 15, 2006. The adoption of this Statement is not expected to have any impact on AVP’s financial position or results of operations.

In March 2006, the FASB issued SFAS No.156, “Accounting for Servicing of Financial Assets - an Amendment of SFAS No.140”. SFAS 156 amends SFAS 140 to clarify the accounting for servicing assets and servicing liabilities. Among other provisions, the new accounting standard requires all separately recognized servicing assets and servicing liabilities to be initially measured at fair value, if practicable. SFAS 156 is effective for the fiscal periods beginning after September 15, 2006. The adoption of SFAS 156 had no material impact on the Company’s financial position, results of operations or cash flows.

In June 2006, the EITF reached a consensus on Issue No. 06-03, “How Taxes Collected from Customers and Remitted to Governmental Authorities Should Be Presented in the Income Statement (That Is, Gross versus Net Presentation)” ( EITF 06-03). EITF 06-03 applies to taxes assessed by a governmental authority that are directly imposed on a revenue-producing transaction between a seller and a customer, and states that the presentation of such taxes on either a gross basis (included in revenues and costs) or on a net basis (excluded from revenues) is an accounting policy decision that should be disclosed. Additionally, for such taxes reported on a gross basis, the amount of such taxes should be disclosed in interim and annual financial statements if the amounts are significant. The provisions of EITF 06-03 are effective for interim and annual reporting periods beginning after December 15, 2006. On January 1, 2007, AVP adopted EITF 06-03. AVP collects certain excise taxes levied by state or local governments. AVP’s excise taxes are accounted for on a gross basis and recorded as revenue. For the three months ended March 31, 2007, there were no taxes levied by state or local governments.

In July 2006, FASB issued FASB Interpretation No. 48 ( FIN 48), “Accounting for Uncertainty in Income Taxes, an interpretation of SFAS No. 109, Accounting for Income Taxes,” which is effective for fiscal years beginning after December 15, 2006, and clarifies the accounting for uncertainty in tax positions. FIN48 requires that we recognize the impact of a tax position in our financial statements if that position is more likely than not of being sustained on audit, based on the technical merits of the position. The cumulative effect of the change in accounting principle is recorded as an adjustment to opening retained earnings. Effective January 1, 2007, the Company adopted FIN 48 with no significant impact on the Company’s financial position or results of operations.

In September 2006, the FASB issued SFAS No. 157, “Fair Value Measures” (SFAS 157). SFAS 157 defines fair value, establishes a framework for measuring fair value and enhances disclosures about fair value measures required under other accounting pronouncements, but does not change existing guidance as to whether or not an instrument is carried at fair value. SFAS 157 is effective for fiscal years beginning after November 15, 2007. The adoption of this accounting pronouncement is not expected to have a material effect on the Company’s consolidated financial position, results of operations or cash flows.

On September 29, 2006, the FASB issued SFAS No. 158, Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans - An Amendment of SFAS No. 87, 88, 106, and 132R. This new standard requires an employer to: (a) recognize in its statement of financial position an asset for a plan’s overfunded status or a liability for a plan’s underfunded status; (b) measure a plan’s assets and its obligations that determine its funded status as of the end of the employer’s fiscal year (with limited exceptions); and (c) recognize changes in the funded status of a defined benefit postretirement plan in the year in which the changes occur. Those changes will be reported in comprehensive income of a business entity and in changes in net assets of a not-for-profit organization. Statement 158 applies to plan sponsors that are public and private companies and nongovernmental not-for-profit organizations. The requirement to recognize the funded status of a benefit plan and the disclosure requirements are effective as of the end of the fiscal year ending after December 15, 2006, for entities with publicly traded equity securities, and at the end of the fiscal year ending after June 15, 2007, for all other entities. The requirement to measure plan assets and benefit obligations as of the date of the employer’s fiscal year-end statement of financial position is effective for fiscal years ending after December 15, 2008.

23

In September 2006, the Securities and Exchange Commission (“SEC”) released Staff Accounting Bulletin No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements” (“SAB 108”). SAB 108 provides interpretive guidance on the SEC’s views regarding the process of quantifying materiality of financial statement misstatements. SAB 108 is effective for the Company’s fiscal year ending October 31, 2007. The adoption of this accounting pronouncement did not have a material effect on the Company’s consolidated financial position, results of operations or cash flows.

In February 2007, the FASB issued SFAS No. 159, "The Fair Value Option for Financial Assets and Financial Liabilities," ("SFAS 159"). SFAS 159 permits entities to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measure at fair value. Unrealized gains and losses on items for which the fair value option has been elected are reporting in earnings. SFAS 159 does not affect any existing accounting literature that requires certain assets and liabilities to be carried at fair value. SFAS 159 is effective for fiscal years beginning after November 15, 2007. The Company currently does not believe SFAS 159 will have a material impact on its consolidated financial position, results of operations or cash flows

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements as defined in Item 303(c) of Regulation S-B.

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ITEM 3. CONTROLS AND PROCEDURES

AVP's management has evaluated, with the participation of its principal executive and financial officers, the effectiveness of AVP's disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) as of the end of the period covered by this report. Based on this evaluation, these officers have concluded, that, as of March 31, 2007, AVP's disclosure controls and procedures are effective to provide reasonable assurance that information required to be disclosed by AVP in reports that it files or submits under the Exchange Act is accumulated and communicated to AVP's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

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PART II. OTHER INFORMATION

ITEM 6. EXHIBITS

10.1 - Agreement and Plan of Merger, dated as of April 5, 2007, by and among AVP, Inc. AVP Holdings, Inc. and AVP Acquisition Corp., incorporated herein by reference to Exhibit 99.1 to the Registrant’s Current Report on Form 8-K, filed on April 9, 2007

31.1 - Certification of President Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2 - Certification of Interim Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32 - Certification of President and Interim Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

26

SIGNATURE

Pursuant to the requirements of Section 13 or 15 or 15(d) 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 on the 14th day of May, 2007.

AVP, INC.
(Registrant)
By:	/s/ William Chardavoyne
	William Chardavoyne
	Interim Chief Financial Officer

27

EXHIBIT INDEX

10.1 - Agreement and Plan of Merger, dated as of April 5, 2007, by and among AVP, Inc. AVP Holdings, Inc. and AVP Acquisition Corp., incorporated herein by reference to Exhibit 99.1 to the Registrant’s Current Report on Form 8-K, filed on April 9, 2007

31.1 - Certification of President Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2 - Certification of Interim Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32 - Certification of President and Interim Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

EX-31.1

EXHIBIT 31.1

EX-31.2

EXHIBIT 31.2

CERTIFICATION OF THE INTERIM CHIEF FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, William Chardavoyne, Interim Chief Financial Officer (Principal Financial Officer) of AVP, Inc., certify that:

I have reviewed this quarterly report on Form 10-QSB for the quarter ended March 30, 2007 of AVP, Inc.;

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 report;

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 small business issuer as of, and for, the periods presented in this report;

The small business issuer’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)) for the small business issuer and have:

designed such disclosure controls and procedures 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 annual report is being prepared;

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 quarterly report based on such evaluation; and

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 year that has materially affected, or is reasonably likely to materially affect, the small business issuer’s internal control over financial reporting.

The small business issuer’s other certifying officer 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):

all significant deficiencies 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

any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer’s internal controls.

Date: May 14, 2007
	By:	/s/ William Chardavoyne
		William Chardavoyne
		Interim Chief Financial Officer (Principal Financial Officer)

EX-32

EXHIBIT 32

CERTIFICATIONS

Pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, each of the undersigned officers of AVP, Inc. hereby certifies, to such officers’ knowledge, that this Quarterly Report on Form 10-QSB of AVP, Inc. for the quarter ended March 31, 2007 fully complies, in all material respects, with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in this Quarterly Report on Form 10-QSB fairly presents, in all material respects, the financial condition and results of operations of AVP, Inc.

Date: May 14, 2007	By:	/s/ Leonard Armato
		Leonard Armato,
		Chief Executive Officer
		(Principal Executive Officer)

By:	/s/ William Chardavoyne
	William Chardavoyne,
	Interim Chief Financial Officer (Principal Financial Officer)