An´ alisis de los modelos cosmol´ ogicos

Item 9A. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures designed to ensure information required to be disclosed in its reports filed pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. Such information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer as appropriate, to allow timely decisions regarding required disclosure. The Company’s management, including its Chief Executive Officer and Chief Financial Officer, does not expect that the Company’s disclosure controls and procedures or internal controls will prevent all possible error and fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance the objectives of the control system are met. Further, the design of a control system must reflect the fact there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected.

The Company’s management, including the Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of the Company’s disclosure controls and procedures (as defined in the exchange Act 13a-15(e) as of March 31, 2007. Based upon the evaluation, the Chief Executive Officer and Chief Financial Officer have concluded the Company’s disclosure controls and procedures were not effective as of March 31, 2007, because of the material weaknesses discussed below.

Management’s Report on Internal Control over Financial Reporting

The Company’s management is responsible for establishing and maintaining adequate internal controls over financial reporting as defined in Rule13a-15(f) of the Exchange Act. The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation and fair presentation of financial statements in accordance with generally accepted accounting principles. The Company’s management, including our chief executive officer and chief financial officer, conducted an evaluation of the design and operational effectiveness of our internal control over financial reporting as of March 31, 2007, the end of the fiscal year covered by this report using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control-Integrated Framework. Based on this evaluation, management concluded, that as of March 31, 2007, we did not maintain effective internal controls over financial reporting in accordance with the COSO criteria, because management determined that we had material weaknesses in the design and operating effectiveness of our internal controls over financial reporting at March 31, 2007. A material weakness in internal control over financial reporting is a control deficiency (within the meaning of the Public Company Accounting Oversight Board’s (“PCAOB”) Auditing Standard No. 2, or combination of control deficiencies, that results in there being more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected.

PCAOB Auditing Standard No. 2 identifies a number of circumstances that, because of their likely significant negative effect on internal control over financial reporting, are to be regarded as at least significant deficiencies as well as strong indicators that a material weakness exists.

Such indicators include restatements of previously issued financial statements and adjustments made by independent accountants that were not initially identified by the company’s internal control over financial reporting. During the year ended March 31, 2007 certain adjustments were identified by the auditors and were made to the financial statements.

Management has evaluated the nature and amount of the adjustments, and while it deems that such adjustments were not of a material magnitude, has nevertheless concluded that there are material weaknesses in internal control as defined under PCAOB Auditing Standard No. 2 as follows:

Segregation of Duties and Limited Staff: Based on the size of the Company, we have limited accounting personnel with the proper training to implement and maintain proper internal controls over financial reporting.

During the fourth quarter ending March 31, 2007 the Company had a key departure in its accounting department, which exacerbated this issue. As a result of a limited staff, we are unable to have sufficient review by individuals not associated with the preparation of account analysis, reconciliation of accounts and preparation of the financial statements.

Loan Loss Analysis: The Company has identified loan loss analysis as a critical area where significant risk is associated with the proper analytical analysis and the use of sound estimates. The estimates and analytical work is subsequently used to arrive at proper reserve levels and adjustments that influence the Company’s profitability in each reporting period. Historically, one individual does the majority of the work performed and the Company does not have the procedures and controls in place to have additional qualified individuals review these calculations and estimates.

Accounting for Income Taxes: The Company identified certain accounts related to the computation of the Company’s income tax provision, income taxes payable and the deferred tax asset that were not fully reconciled on a timely basis.

The control deficiencies described above, either individually or in combination, could result in a misstatement of the aforementioned accounts or disclosures that would result in a material misstatement to the annual or interim consolidated financial statements that would not be prevented or detected. Management has determined that the above mentioned control deficiencies constitute material weaknesses. As a result of this conclusion and as part of the preparation of this report, we have applied compensating procedures and processes as necessary to ensure the reliability of our financial reporting. Accordingly, management believes, that (1) this report does not contain any untrue statement of a material fact, (2) omit a material fact necessary to make the statements made not misleading with respect to the period covered by this report, (3) and the financial statements, and other financial information included in this report, fairly present in all material respects our financial condition, results of operations and cash flows as of March 31, 2007 and for the period then ended.

Remedial Steps to Address the Material Weaknesses

Segregation of Duties and Limited Staff: The Company will evaluate its current accounting staff and make decisions in regards to hiring additional qualified accounting personnel. The Company will also evaluate the possibility of outsourcing certain accounting functions to alleviate staffing issues and or segregation of duties issues.

Loan Loss Analysis: The management of the Company will work more directly with the Audit Committee in the loan loss analysis area. This might include additional information presented to the Audit Committee, additional in-house training and other steps to allow the Audit Committee to properly oversee and evaluate loan

Accounting for Income Taxes: The Company will evaluate whether to hire an individual with expertise in the area of income taxes or if the deficiency in this area can be resolved with its current staff. The Company will also put into place the necessary changes to ensure that all reconciliation’s related to income taxes are performed on a timely basis.

These remediation plans will be implemented during the second and third quarters of fiscal 2008. The material weakness will not be considered remediated until the applicable remedial procedures operate for a period of time, such procedures are tested and management has concluded that the procedures are operating effectively.

The Company’s independent registered public accounting firm, Dixon Hughes PLLC has issued an attestation report on management’s assessment of the Company’s internal control over financial reporting. The report appears below.

Change in Internal Control Over Financial Reporting

No changes in the Company’s internal control over financial reporting has occurred during the Company’s last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders Nicholas Financial, Inc.

We have audited management's assessment, included in the accompanying Management's Report on Internal Control Over Financial Reporting, that Nicholas Financial, Inc. and subsidiaries (the “Company”) did not maintain effective internal control over financial reporting as of March 31, 2007 because of the effect of the material weaknesses identified in management’s assessment, based on criteria established in Internal Control--Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. The Company's management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting. Our responsibility is to express an opinion on management's assessment and an opinion on the effectiveness of the Company's internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, evaluating management's assessment, testing and evaluating the design and operating effectiveness of internal control, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company' s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

A material weakness is a control deficiency, or combination of control deficiencies, that results in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected. The following material weaknesses have been identified and included in management’s assessment.

Segregation of Duties and Limited Staff: Based on the size of the Company, it has limited accounting personnel with the proper training to implement and maintain proper internal controls over financial reporting.

During the fourth quarter ending March 31, 2007 the Company had a key departure in its accounting department which exacerbated this issue. As a result of a limited staff, the Company is unable to have sufficient review by individuals not associated with the preparation of account analysis, reconciliation of accounts and preparation of the consolidated financial statements.

Loan Loss Analysis: The Company has identified loan loss analysis as a critical area where significant risk is associated with the proper analytical analysis and the use of sound estimates. The estimates and analytical work is subsequently used to arrive at proper reserve levels and adjustments that influence the Company’s profitability in each reporting period. Historically, one individual does the majority of the work performed and the Company does not have the procedures and controls in place to have additional qualified individuals review these calculations and estimates.

Accounting for Income Taxes: The Company identified certain accounts related to the computation of the Company’s income tax provision, income taxes payable and the deferred tax asset that were not fully reconciled on a timely basis.

In our opinion, management's assessment that the Company did not maintain effective internal control over financial reporting as of March 31, 2007, is fairly stated, in all material respects, based on criteria established in Internal Control--Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Also in our opinion, because of the effect of the material weaknesses described above on the achievement of the objectives of the control criteria, the Company did not maintain, in all material respects, effective internal control over financial reporting as of March 31, 2007, based on criteria established in Internal Control--Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of the Company as of March 31, 2007 and 2006 and the related consolidated statements of income, shareholders' equity, and cash flows for each of the years in the three-year period ended March 31, 2007, and our report dated June 14, 2007, expressed an unqualified opinion on those consolidated financial statements. The material weaknesses were considered in determining the nature, timing, and extent of audit tests applied in our audit of the 2007 consolidated financial statements, and this report does not affect our report dated June 14, 2007, which expressed an unqualified opinion on those consolidated financial statements.

Atlanta, Georgia June 14, 2007

Item 9B. Other Information None.

PART III