10QSB 1 andean10q.txt U.S. 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 September 30, 2003 [TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________ to ___________ Commissions file number 33-90696 ----------------------- 1224 Washington Avenue Miami Beach, Florida 33139 (Address of principal executive offices) (305) 531-1174 (Issuer's telephone number) Check whether the Issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ] State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date. As of September 30, 2003, 2,820,100 shares of $.0001 par value common stock were outstanding. Transitional Small Business Disclosure Format (check one) Yes [ ] No [X] ANDEAN DEVELOPMENT CORPORATION INDEX Part I.Financial Information. Item 1.Financial Statements (Unaudited). Item 2.Management's Discussion and Analysis of Financial Condition and Results of Operations. Part II. Other Information. ANDEAN DEVELOPMENT CORPORATION PART I FINANCIAL INFORMATION Item 1. Financial Statements Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (the "Commission"). Although the Company believes the disclosures made are adequate to make the information presented not misleading, and, in the opinion of management, all adjustments have been reflected which are necessary for a fair presentation of the information shown and the accompanying notes, these condensed unaudited financial statements should be read in conjunction with the audited financial statements for the year ended December 31, 2002. The results for the nine months ended September 30, 2003 are not necessarily indicative of the results of operations for a full year or of future periods. ANDEAN DEVELOPMENT CORPORATION Consolidated Balance Sheets September 30, 2003 and December 31, 2002 A S S E T S September 30, December 31, 2003 2002 --------------------------------- (Unaudited) Current Assets: Cash $ 1,187 $ 1,069 Accounts receivable 49,693 49,693 Notes receivable, net - current 33,120 33,120 portion Other current assets 170,511 192,790 ----------------------- Total Current Assets 254,511 276,672 ----------------------- Property, Plant and Equipment, net 305,503 319,503 ----------------------- Other Assets: Note receivable from related party 198,726 198,726 and other, net Investment in unconsolidated 2,543 2,543 subsidiaries ----------------------- 201,269 201,269 ----------------------- $ 761,283 $ 797,444 ======================= The accompanying notes are an integral part of these consolidated financial statements. ANDEAN DEVELOPMENT CORPORATION AND SUBSIDIARIES Consolidated Balance Sheets (Continued) September 30, 2003 and December 31, 2002 LIABILITIES AND SHAREHOLDERS' EQUITY September 30, December 31, 2003 2002 ----------------------------- (Unaudited) Current Liabilities: Obligations with banks $ 36,228 $ 36,228 Current maturities of long-term 33,121 33,121 debt Accounts payable and accrued 81,953 109,576 expenses Due to related parties 36,781 32,036 Income taxes payable 18,684 18,684 ----------------------- Total Current Liabilities 206,767 229,645 ----------------------- Long-Term Liabilities: Long-term debt, excluding current 37,181 37,181 maturities Staff severance indemnities 50,358 32,018 ---------------------- 87,539 69,199 ----------------------- Shareholders' Equity: Preferred stock, $.0001 par value, 5,000,000 shares authorized, no shares issued and - - outstanding Common stock, $.0001 par value, 20,000,000 shares authorized, 2,820,100 shares 282 282 issued and outstanding Additional paid-in capital 5,660,187 5,660,187 Accumulated deficit (4,828,439) (4,796,816) Accumulated other comprehensive (365,053) (365,053) income (loss) -------------------------- Total Shareholders' Equity 466,977 498,600 -------------------------- $ 761,283 $ 797,444 ========================== The accompanying notes are an integral part of these consolidated financial statements. ANDEAN DEVELOPMENT CORPORATION Consolidated Statements of Income Three Months Ended September 30, 2003 and 2002 2003 2002 ----------------------- (Inactive) Revenues from Operations: Revenues $ - $ 32,473 Cost of operations - (6,977) ----------------------- Gross Profit - 25,496 Selling and Administrative Expenses - (95,547) ----------------------- (Loss) Income from Operations - (70,051) ----------------------- Other Expenses, net - (56,937) ----------------------- Loss Before Income Taxes - (126,988) Income Taxes - - ----------------------- Net Loss - (126,988) Other Comprehensive Loss: Foreign currency translation - (24,925) adjustment ----------------------- Comprehensive Loss $ - $ (151,913 ) ======================= Net Loss per Common Share $ - $ (.05 ) Weighted Average Shares Outstanding 2,820,100 2,820,100 The accompanying notes are an integral part of these consolidated financial statements. ANDEAN DEVELOPMENT CORPORATION Consolidated Statements of Income Nine months Ended September 30, 2003 and 2002 2003 2002 -------------------- Revenues from Operations: Revenues $ 124,969 $174,981 Cost of operations 112,592 63,236 ------------------ Gross Profit 12,377 111,745 Selling and Administrative Expenses 44,000 161,406 ------------------ (Loss) Income from Operations (31,623) (49,661) ------------------ Other Expenses, net - (149,326) ------------------ Net Loss (31,623) (198,987) Other Comprehensive Loss: Foreign currency translation - (81,187) adjustment ------------------ Comprehensive Loss $ (31,623) $(280,174) ================== Net Loss per Common Share $ (.022) $ (.10 ) ================== Weighted Average Shares Outstanding 2,820,100 2,820,100 ===================== The accompanying notes are an integral part of these consolidated financial statements. ANDEAN DEVELOPMENT CORPORATION Consolidated Statements of Shareholders' Equity Nine months Ended September 30, 2003
Accumulated Total Common Additional Accumulated Other Shareholders' Stock Paid-In Deficit Comprehensive Equity Capital Income (Loss) Balance at December 31, $ 282 $5,660,187 $(4,796,816) $ (365,053) $ 498,600 2002 Net loss (Unaudited) - - (31,623) - (31,623) Foreign currency translation adjustment (Unaudited) - - - - - ------------------------------------------------------------------ Balance at September 30, $ 282 $5,660,187 $(4,828,439) $ (365,053) $ 466,977 2003 (Unaudited) ==================================================================
The accompanying notes are an integral part of these consolidated financial statements. ANDEAN DEVELOPMENT CORPORATION Consolidated Statements of Cash Flows Nine months Ended September 30, 2003 and 2002 2003 2002 -------------------------- (Unaudited) (Unaudited) Cash Flows from Operating Activities: Net (loss) income $ (31,623) $(198,987) Adjustments to reconcile net income to net cash (used in) provided by operating activities: Depreciation and amortization 14,000 86,263 Translation adjustment - ( 81,187) Minority interest - (3,514) Changes in assets and liabilities: (Increase) decrease in: Accounts receivable - 101,037 Other current assets 22,279 (24,397) Notes receivable - 27,373 Deposits and other assets - (1,011) Increase (decrease) in: Accounts payable and accrued (27,623) (43,832) expenses Income taxes payable - 10,001 Staff severance indemnity 18,340 (9,551) ----------------------- Net Cash Used in Operating (4,627) (137,787) Activities ----------------------- Cash Flows from Financing Activities: Borrowings from related parties $ 4,745 $ 176,546 Payments on obligations with bank - (21,934) Principal payments on long-term - (22,606) debt --------------------- Net Cash Provided by Financing 4,745 132,006 Activities Net Increase in Cash 118 (447) Cash at Beginning of Period 1,069 931 --------------------- Cash at End of Period $ 1,187 $ 484 ===================== Supplemental Disclosure of Cash Flow Information Cash paid during the period for interest - 19,940 The accompanying notes are an integral part of these consolidated financial statements. ANDEAN DEVELOPMENT CORPORATION Notes to Consolidated Financial Statements NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation - The quarterly financial information included herein is unaudited; however, such information reflects all adjustments (consisting solely of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of results for the interim period. For further information, refer to the consolidated financial statements and notes thereto included in the Company's form 10-KSB as of and for the year ended December 31, 2002. Functional Currency - The consolidated financial statements have been translated in accordance with the provisions set forth in Statement of Financial Accounting Standards No. 52, from Chilean pesos (the functional currency) into US dollars (the reporting currency). Earnings Per Common Share - Earnings per common share are based on the weighted average number of shares outstanding of 2,820,100 for the periods ended September 30, 2003 and 2002, respectively. Warrants issued with exercise prices greater than the existing market value of the company stock are deemed anti-dilutive and are not components of earnings per share. ANDEAN DEVELOPMENT CORPORATION ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Management's Discussion and Analysis contains various "forward looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, regarding future events or the future financial performance of the Company that involve risks and uncertainties. Certain statements included in this Form 10-QSB, including, without limitation, statements related to anticipated cash flow sources and uses, and words including but not limited to "anticipates", "believes", "plans", "expects", "future" and similar statements or expressions, identify forward looking statements. Any forward-looking statements herein are subject to certain risks and uncertainties in the Company's business, including but not limited to, reliance on key customers and competition in its markets, market demand, product performance, technological developments, maintenance of relationships with key suppliers, difficulties of hiring or retaining key personnel and any changes in current accounting rules, all of which may be beyond the control of the Company. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those set forth therein. Management's Discussion and Analysis of Consolidated Results of Financial Condition and Results of Operations ("MD&A") should be read in conjunction with the consolidated financial statements included herein. Further, this quarterly report on Form 10-QSB should be read in conjunction with the Company's Consolidated Financial Statements and Notes to Consolidated Financial Statements included in its 2002 Annual Report on Form 10-KSB. In addition, you are urged to read this report in conjunction with the risk factors described herein. BACKGROUND The Company was incorporated as a Florida corporation on October 19, 1994 under the name "Igenor U.S.A., Inc." On January 10, 1995, the Company changed its name to "Andean Development Corporation." The Company undertook a reorganization upon the closing of its November 1996 initial public offering, but which was given effect as of December 31, 1994, whereby AE&A and INA became majority owned (99.99%) subsidiaries of the Company pursuant to share exchange agreements. Chilean corporate law requires that a Chilean corporation have no less than two different shareholders at any given time and thus, one share of INA is owned by AE&A and one share of AE&A is owned by INA. AE&A was organized on February 28, 1991, in Santiago, Chile, as a Chilean limited partnership under the name "Errazuriz y Asociados Ingenieros Limitada." On September 21, 1994, AE&A was reorganized as a Chilean corporation and its name was changed to "Errazuriz y Asociados Ingenieros S.A." INA was organized on June 11, 1986, in Santiago, Chile as a Chilean limited partnership under the name "Ingenieria Norconsult Andina Limitada." Initially INA was a joint venture between Norconsult SA, a worldwide engineering consulting company based in Oslo, Norway ("Norconsult") and Errazuriz y Asociados Arquitectos S.A. ("EAA"). Norconsult subsequently sold its participation to Igenor Ingenierie et Gestion, S.A., a Swiss corporation ("Igenor"). On September 15, 1994, pursuant to Chilean law, INA was reorganized from a limited partnership to a Chilean corporation, and its name was changed to "Igenor Andina S.A." In 2000, EAA sold its interests to INA. The Company was also the majority owner (83.6%) of a non-operating subsidiary, Consonni USA, Inc. ("Consonni USA"), the assets of which consist of cash and notes receivables. On December 31, 2002, the Company exchanged its holdings in Consonni USA for the assets and liabilities of Consonni USA, such assets consisting of the balance of a promissory note payable in the principal outstanding amount of $552,000 with six remaining payments of approximately ninety two thousand U.S. dollars (U.S. $92,000) payable September 30 and January 31 of each year. On August 31, 2001, the Company extended the expiration date of its Redeemable Common Stock Purchase Warrants (the "Warrants") from November 13, 2001 to November 13, 2003. The Company originally issued the Warrants in connection with a stock offering on Registration Statement Form SB-2 (SEC File No. 333-90696) which was declared effective by the Securities and Exchange Commission on November 13, 1996. The Company has determined to allow the Warrants to expire. HISTORY Since the inception of INA in 1986, the Company has expanded its engineering and project management activities to the sale of equipment, commercial work and to support of manufacturers or international consortiums in the sale of large turnkey projects. Following its November 1996 initial public offering, the Company diversified its business. Pursuant to the Company's initial business plan, and consistent with the strategy that the Company initiated in 1996 of investing in businesses that should provide a steady cash flow to compensate the irregularity of the incomes of its core business, the Company purchased interests in related and unrelated businesses. For example, in 1997 the Company purchased an interest in Ingesis S.A., an engineering company specializing in software and in Negociaciones y Servidumbre, S. A., an engineering company specializing in evaluations and negotiations of land needed for infrastructure projects; in 1998 the Company purchased an interest in Construcciones Electromecanicas Consonni, S.A. ("Consonni"), a manufacturing facility of industrial electric equipment. While not related to the core business, the Company also diversified by purchasing an equity position in a winery in 1997 and in a vineyard in 1998. The purpose of this equity participation in those companies was to create in the medium term a steady cash flow, an increase in the net revenues and, in general, to expand and diversify the Company's business. While the Company generated some revenues from 1999 and 2002, due to the impact of adverse economic conditions in the core business segment, the core business incurred losses which were only partially compensated by the revenues obtained through Consonni USA. This business structure did not achieve the intended results. Furthermore, shareholders of the Company expressed their objections to the diversification of the Company under the then current business structure. It was difficult and costly to manage geographically and across separate and distinct markets. The legal and accounting expenses incurred in order to comply with federal securities became excessive and while Consonni USA generated revenues, it failed to achieve the level of profitability that offset the additional costs and management time that was required. ECONOMIC OVERVIEW The costs associated with the ongoing operations of the Company made it exceedingly difficult to achieve profitability in the business, which resulted in continuing losses. As a result those ongoing operating losses and expenses, the Company had a significant working capital deficit, negative stockholder's equity, and almost no remaining cash. The sums owed to the Company from third parties, particularly the payments on the balance of a promissory note payable assumed in the sale of the interests of Consonni USA, are in arrears and their collection is in doubt. While the accountants have carried the sums owed to the parties as assets, the business conditions in Spain, the location of those entities, and the failure of those entities to generate any revenues that would allow them to satisfy their obligations to the Company make it unlikely, in management's opinion, that the Company will be able to collect on those debts. The Company does not have the funds to pursue any legal action to collect such sums outstanding. In fiscal 2002, the Company experienced a net loss of ($1,691,307), an increase of $1,286,952 over the loss of ($404,355) in 2001. In the first quarter of fiscal 2003, the Company experienced a net loss before taxes of $31,623. The Company does not anticipate any revenues in the core business in 2003. As a consequence, the majority shareholder, CEO and Director, Pedro Pablo Err zuriz, determined, with the unanimous support of the Company's Board of Directors that the shareholders of the Company would be better served from the acquisition of another business with the ultimate goal of establishing a more liquid public market for its common stock. In order to facilitate such a transaction the Board has determined that the capitalization structure of the Company should be simplified and the Company should divest itself of its assets and liabilities. No assurances can be given such an acquisition will be achieved. FINANCIAL CONDITION AND RESULTS OF OPERATIONS COMPARISON OF THREE MONTHS ENDED SEPTEMBER 30, 2003 TO THREE MONTHS ENDED SEPTEMBER 30, 2002 Gross Revenues and Costs of Operations Gross revenues decreased from $$32,473 for the three months ended September 30, 2002 to $-0- for the three months ended September 30, 2003, primarily as a consequence of the Company's decision to divest itself of its assets and liabilities and cease operations. Cost of Operations decreased from ($6,977) for the three months ended September 30, 2002 to $-0- for the three months ended September 30, 2003, primarily as a consequence of the Company's decision to divest itself of its assets and liabilities and cease operations. Selling and Administrative Expenses, Incomes from Operations and Other Income (Expense) Selling and administrative expenses decreased from ($95,547) for the three months ended September 30, 2002 to $-0- for the three months ended September 30, 2003, primarily as a consequence of the Company's decision to divest itself of its assets and liabilities and cease operations. Income (loss) from operations, decreased from a loss of ($70,051) for the three months ended September 30, 2002 to $-0- for the three months ended September 30, 2003, primarily as a consequence of the Company's decision to divest itself of its assets and liabilities and cease operations. Other expenses decreased from net expenses of ($56,937) for the three months ended September 30, 2002 to $-0- for the three months ended September 30, 2003, primarily as a consequence of the Company's decision to divest itself of its assets and liabilities and cease operations. Net Income (Loss) Before Income Tax Net loss before income taxes decreased from a loss of ($126,988) for the three months ended September 30, 2002 to $-0- for the three months ended September 30, 2003, primarily as consequence of the Company's decision to divest itself of its assets and liabilities and cease operations. FINANCIAL CONDITION AND RESULTS OF OPERATIONS COMPARISON OF NINE MONTHSENDED SEPTEMBER 30, 2003 TO NINE MONTHS ENDED SEPTEMBER 30, 2002 Gross Revenues and Costs of Operations Gross revenues decreased from $174,981 for the nine months ended September 30, 2002 to $124,969 for the nine months ended September 30, 2003, a decrease of $50,012, primarily a result of general economic conditions, including financial instability in Argentina and other South American countries and as a consequence of the Company's decision to divest itself of its assets and liabilities and cease operations in the second quarter. Cost of Operations increased from $63,236 for the nine months ended September 30, 2002 to $112,592 for the nine months ended September 30, 2003, an increase of $49,356, primarily as a result of an increase in operational costs resulting from the increased costs in the ordinary course of business offset as a consequence of the Company's decision to divest itself of its assets and liabilities and cease operations. Selling and Administrative Expenses, Incomes from Operations and Other Income (Expense) Selling and administrative expenses increased from $161,406 for the nine months ended September 30, 2002 to $44,000 for the nine months ended September 30, 2003, primarily as a consequence of the increase in expenses related to the cost of operations and offset by the Company's decision to divest itself of its assets and liabilities and cease operations. Income (loss) from operations, decreased from a loss of $(49,661) for the nine months ended September 30, 2002 to a loss of ($31,623) for the nine months ended September 30, 2003, primarily as consequence of the Company's decision to divest itself of its assets and liabilities and cease operations. Other expenses decreased from net expenses of $149,326 for the nine months ended September 30, 2002 to $-0- for the nine months ended September 30, 2003, primarily as a consequence of the Company's decision to divest itself of its assets and liabilities and cease operations. Net Loss Net loss decreased from a loss of ($198,987) for the nine months ended September 30, 2002 to a loss of ($31,623) for the nine months ended September 30, 2003, primarily as a consequence of the Company's decision to divest itself of its assets and liabilities and cease operations. Liquidity and Capital Resources The Company previously financed its operations and other working capital requirements principally from operating cash flow and bank financing. Currently the Company has no liquidity or capital resources, primarily as a result of the Company's decision to divest itself of its assets and liabilities and cease operations. Current Assets Cash increased from $1,069 as of December 31, 2002 to $1,187 for the nine months ended September 30, 2003, an increase of $118. As of December 31, 2002 and for the three month period ended September 30, 2003, the Company had no short-term investments. Accounts receivable remained at $49,693 at December 31, 2002 and for the six month period ended September 30, 2003, primarily as a consequence of the Company's decision to divest itself of its assets and liabilities and cease operations. Notes receivable and other current assets decreased from $225,910 as of December 31, 2002 to $203,631 for the six month period ended September 30, 2003, a decrease of $22,279. Total current assets decreased from $276,672 at December 31, 2002 to $254,511 for the six month period ended September 30, 2003 a decrease of $22,161. Property, plant and equipment, net decreased from $319,503 at December 31, 2002 to $305,503 for the six month period ended September 30, 2003, a decrease of $14,000 due to depreciation expense of $14,000 for the first quarter ended March 31, 2003. Liabilities Current liabilities decreased from $229,645 at December 31, 2002 to $206,767 for the six month period ended September 30, 2003, a decrease of $22,878. Long-term liabilities increased from $69,199 at December 31, 2002 to $87,539 for the six month period ended September 30, 2003, an increase of $18,340. As of September 30, 2003, there were no commitments for long-term capital expenditures. If the Company is unable to maintain profitability, or seeks further expansion, additional funding will become necessary. No assurances can be given that either equity or debt financing will be available. ITEM 3. CONTROLS AND PROCEDURES The Company's Chief Executive Officer have concluded, based on an evaluation conducted within 90 days prior to the filing date of this Quarterly Report on Form 10-QSB, that the Company's disclosure controls and procedures have functioned effectively so as to provide those officers the information necessary whether: (i) this Quarterly Report on Form 10-QSB contains any untrue statement of a material fact or omits 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 on Form 10-QSB, and (ii) the financial statements, and other financial information included in this Quarterly Report on Form 10- QSB, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this Quarterly Report on Form 10-QSB. There have been no significant changes in the Company's internal controls or in other factors since the date of the Chief Executive Officer's evaluation that could significantly affect these internal controls, including any corrective actions with regards to significant deficiencies and material weaknesses. ANDEAN DEVELOPMENT CORPORATION PART II: OTHER INFORMATION ITEM 1: Legal Proceedings None ITEM 2: Changes in Securities None ITEM 3: Defaults Upon Senior Securities None ITEM 4: Submission of Matters to a Vote of Securities Holders None ITEM 5: Other Information ITEM 6: Exhibits and Reports on Form 8-K A. Exhibits: 31.1 Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act. 31.2 Certification of Principal Financial and Accounting Officer Pursuant to Section 302 of the Sarbanes-Oxley Act. 32.1 Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act. 31.1 Certification of Principal Financial and Accounting Officer Pursuant to Section 906 of the Sarbanes-Oxley Act. B. Reports on Form 8-K: None ANDEAN DEVELOPMENT CORPORATION SIGNATURE In accordance with the requirements of the Exchange Act of 1934, the Registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. ANDEAN DEVELOPMENT CORPORATION _____________/s/ Pedro Pablo Err zuriz______________ Pedro Pablo Err zuriz, President and Chief Executive Officer Date: November 13, 2003 Exhibit 31.1 Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and pursuant to Rule 13a- 14(a) and Rule 15d-14 under the Securities Exchange Act of 1934 -------------------------------------------------------------------- In connection with the Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 on Form 10-QSB of Andean Development Corporation (the "Company") for the period ended September 30, 2003, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Pedro Pablo Err zuriz, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Sec.1350, as adopted pursuant to Section 302 and 906 of the Sarbanes-Oxley Act of 2002, and pursuant to Rule 13a-14 under the Securities Exchange Act of 1934, that: 1. I have reviewed the Report being filed; 2. Based on my knowledge, the 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 the Report; 3. Based on my knowledge, the financial statements, and other financial information included in the Report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the period presented in the Report; 4. I and the other certifying officers are responsible for establishing and maintaining disclosure controls and procedures (as such term is defined in paragraph (c) of Rule 13a-14) for the Company and have: i. Designed such disclosure controls and procedures to ensure that material information relating to the Company, including its consolidated subsidiaries, if any, is made known to them by others within those entities, particularly during the period in which the periodic reports are being prepared; ii. Evaluated the effectiveness of the Company's disclosure controls and procedures as of a date within 90 days prior to the filing date of the Report ("Evaluation Date"); and iii. Presented in the Report their conclusions about the effectiveness of the disclosure controls and procedures based on their evaluation as of the Evaluation Date; 5. I and the other certifying officers have disclosed, based on their most recent evaluation, to the Company's auditors and the audit committee of the board of directors (or persons fulfilling the equivalent function): i. All significant deficiencies in the design or operation of internal controls which could adversely affect the Company's ability to record, process, summarize and report financial data and have identified for the Company's auditors any material weaknesses in internal controls; and ii. Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal controls; and 6. I and the other certifying officers have indicated in the 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 their most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Dated: November 13, 2003 /s/ Pedro Pablo Err zuriz_____________ Pedro Pablo Err zuriz President and Chief Executive Officer Exhibit 31.2 Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 302 and 906 of the Sarbanes-Oxley Act of 2002 and pursuant to Rule 13a-14b) and Rule 15d-14(b)(17 CFR 240.15d-14(b))I, Jose Luis Yrarrazaval, under the Securities Exchange Act of 1934 and Section 1350 of Chapter 63 of Title 18 of the United States Code -------------------------------------------------------------------- In connection with the Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 on Form 10-QSB of Andean Development Corporation (the "Company") for the period ended April 30, 2003, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, W. Russell Smith III, the Company's Principal Financial and Accounting Officer, certify, pursuant to 18 U.S.C. Sec.1350, as adopted pursuant to Section 302 and 906 of the Sarbanes-Oxley Act of 2002, and pursuant to Rule 13a-14 under the Securities Exchange Act of 1934, that: 1. I have reviewed the Report being filed; 2. Based on my knowledge, the 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 the Report; 3. Based on my knowledge, the financial statements, and other financial information included in the Report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the period presented in the Report; 4. I and the other certifying officers are responsible for establishing and maintaining disclosure controls and procedures (as such term is defined in paragraph (c) of Rule 13a-14) for the Company and have: i. Designed such disclosure controls and procedures to ensure that material information relating to the Company, including its consolidated subsidiaries, if any, is made known to them by others within those entities, particularly during the period in which the periodic reports are being prepared; ii. Evaluated the effectiveness of the Company's disclosure controls and procedures as of a date within 90 days prior to the filing date of the Report ("Evaluation Date"); and iii. Presented in the Report their conclusions about the effectiveness of the disclosure controls and procedures based on their evaluation as of the Evaluation Date; 5. I and the other certifying officers have disclosed, based on their most recent evaluation, to the Company's auditors and the audit committee of the board of directors (or persons fulfilling the equivalent function): i. All significant deficiencies in the design or operation of internal controls which could adversely affect the Company's ability to record, process, summarize and report financial data and have identified for the Company's auditors any material weaknesses in internal controls; and ii. Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company's internal controls; and 6. I and the other certifying officers have indicated in the 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 their most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Dated: November 13, 2003 /s/ Jose Luis Yrarrazaval______________ Jose Luis Yrarrazaval Chief Financial Officer Exhibit 32.1 Certification pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley act of 2001. -------------------------------------------------------------------- In connection with the Quarterly Report of Andean Development Corporation (the "Company") on Form 10-QSB for the period ended September 30, 2003, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Pedro Pablo Err zuriz, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2001, that: The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Dated: November 13, 2003 /s/ Pedro Pablo Err zuriz, _____________ Pedro Pablo Err zuriz, President and Chief Executive Officer Exhibit 32.1 Certification pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley act of 2001. -------------------------------------------------------------------- In connection with the Quarterly Report of Andean Development Corporation (the "Company") on Form 10-QSB for the period ended September 30, 2003, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Jose Luis Yrarrazaval, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2001, that: The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Dated: November 13, 2003 /s/ Jose Luis Yrarrazaval______________ Jose Luis Yrarrazaval Chief Financial Officer