UNITED
  STATES SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549_________________ FORM 10-QSB

> [X] Quarterly Report
>           pursuant Section 13 or 15(d) of the Securities Exchange Act of 1934

For the
  quarterly period ended June 30, 2002

> [  ] Transition
>           report pursuant section 13 or 15(d) of the Securities Exchange Act of
>           1934

0-9040

Commission
  file number

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

Nevada(State or other jurisdiction)

Pending(IRS Employer of incorporation or organization Identification No.)

220 King
  Street West, Suite 200 Toronto, Ontario, M5H 1K4 Canada(Address of principal executive offices)

416-214-1587
  (Issuer's telephone number)

(Former Name,
  Address and Former Fiscal Year, if Changed Since Last Report)

Check whether the issuer:

| | (1) | filed
        all reports required to be filed by Section 13 or 15(d) of the Exchange
        Act 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........                                                                                                                              

Check whether
  the registrant filed all documents and reports required to be filed by Section
  12, 13 or 15(d) of the Exchange Act after the distribution of securities under
  a plan confirmed by court. Yes......No....X....

As of September
  16, 2002 there were 66,409,415 shares of the Registrant's common stock, par
  value $0.001 per share outstanding.

Transitional Small Business
  Disclosure Format (check one);

Yes......No....X....

---

**AUCXIS
  CORP.****(FORMERLY
  E-AUCTION GLOBAL TRADING INC.)**

FORM 10-QSB

INDEX

|PART I. FINANCIAL
      INFORMATION                                                                                                           | Page | 
|--------------------------------------------------------------------------------------------------------------------------------------------- | ---- | 
|                                                                                                                                              |      | 
|                                                                                                                                              |      | 
|Item 1. Financial Statements                                                                                                                  | 3    | 
|                                                                                                                                              |      | 
|Consolidated
      Balance Sheet at June 30, 2002 (Unaudited) and December 31, 2001                                                           | 4    | 
|                                                                                                                                              |      | 
|Consolidated
      Statements of Operations, Deficit and Comprehensive Loss (Unaudited) for
      the six months ended June 30, 2002 and 2001 | 5    | 
|                                                                                                                                              |      | 
|Consolidated
      Statements of Cash Flows (Unaudited) for the six months ended June 30,  2002
      and 2001                                | 6    | 
|                                                                                                                                              |      | 
|Notes
      to Consolidated Financial Statements                                                                                              | 7    | 
|                                                                                                                                              |      | 
|Item 2. Managements
      Discussion and Analysis of Financial Condition and Results of Operations                                           | 13   | 
|                                                                                                                                              |      | 
|PART II. OTHER INFORMATION                                                                                                                    | 16   | 
|                                                                                                                                              |      | 
|Item 1. Legal Proceedings                                                                                                                     | 16   | 
|                                                                                                                                              |      | 
|Item 5: Other Information                                                                                                                     | 17   | 
|                                                                                                                                              |      | 
|Item 6. Exhibits and
      Reports on Form 8-K                                                                                                | 18   | 
|                                                                                                                                              |      | 
|Signatures                                                                                                                                    | 18   | 
|                                                                                                                                              |      | 

---

> ITEM 1. Financial Statements
>         Aucxis Corp.
>         (formerly e-Auction Global Trading Inc.) 
>         (a Nevada Corporation)
>       Consolidated Financial
>         Statements 
>         (Unaudited) 
>         June 30, 2002 
>         (expressed in U.S. dollars)

---



---

**___________________________________________________________________________________________________________________________**AUCXIS
  CORP.**(****formerly
  e-Auction Global Trading Inc.)**

**CONSOLIDATED
  BALANCE SHEETS**

**(in U.S. dollars)**__________________________________________________________________________________________________________________________

|                                                              |           | June
      30, 2002 |   |           |   | December
      31, 2001 |  
|------------------------------------------------------------- | --------- | ------------------- | - | --------- | - | ----------------------- | -
|                                                              |           |                     |   |           |   |                         |  
|ASSETS                                                        |           |                     |   |           |   |                         |  
|                                                              |           |                     |   |           |   |                         |  
|CURRENT ASSETS                                                |           |                     |   |           |   |                         |  
|Cash and equivalents                                          | $         | 305,686             |   |           | $ | 310,050                 |  
|Accounts receivable
      (Note 5)                            | 1,562,894 |                     |   | 1,230,348 |  
|Inventory (Note 6)                                            | 2,062,959 |                     |   | 404,310   |  
|Prepaid expenses                                              | 94,941    |                     |   | 113,528   |  
|                                                              |           |                     |   |           |  
|Total Current Assets                                          | 4,026,480 |                     |   | 2,058,236 |  
|                                                              |           |                     |   |           |  
|Investments (Note
      7)                                    | 126,183   |                     |   | 115,772   |  
|Property, plant and
      equipment (Note 8)                  | 482,085   |                     |   | 706,854   |  
|Acquired core technology
      (Notes 4 and 10)               | 374,485   |                     |   | 449,381   |  
|                                                              |           |                     |   |           |  
|Total Assets                                                  | $         | 5,009,233           |   |           | $ | 3,330,243               |  
|                                                              |           |                     |   |           |  
|                                                              |           |                     |   |           |  
|LIABILITIES                                                   |           |                     |   |           |   |                         |  
|                                                              |           |                     |   |           |   |                         |  
|CURRENT LIABILITIES                                           |           |                     |   |           |   |                         |  
|Accounts payable
      and accrued liabilities (Note 13)      | $         | 1,288,680           |   |           | $ | 1,462,832               |  
|Due to related parties
      (Note 14)                        |           | 372,071             |   |           |   | 352,335                 |  
|Deferred revenue                                              |           | 2,747,436           |   |           |   | 711,551                 |  
|Current portion of
      long-term debt (Note 16)             |           | 469,382             |   |           |   | 89,055                  |  
|Deferred taxes                                                |           | 12,815              |   |           |   | 11,577                  |  
|                                                              |           |                     |   |           |   |                         |  
|Total Current Liabilities                                     |           | 4,890,384           |   |           |   | 2,627,350               |  
|Long-term debt (Note
      16)                                |           | 135,055             |   |           |   | 165,643                 |  
|                                                              |           |                     |   |           |   |                         |  
|Total Long-term Debt                                          |           | 5,025,439           |   |           |   | 2,792,993               |  
|Mandatory Redeemable
      Shares of Common Stock (Note 4(a)) |           | 4,818,181           |   |           |   | 4,818,181               |  
|                                                              |           |                     |   |           |   |                         |  
|Total Liabilities                                             |           | 9,843,620           |   |           |   | 7,611,174               |  
|                                                              |           |                     |   |           |   |                         |  
|                                                              |           |                     |   |           |   |                         |  
|STOCKHOLDERS
      EQUITY (DEFICIT)                          |           |                     |   |           |   |                         |  
|                                                              |           |                     |   |           |   |                         |  
|COMMON STOCK, $0.001
      par value; 250,000,000 shares      |           |                     |   |           |   |                         |  
|authorized,
      62,773,051 issued and outstanding           |           | 62,773              |   |           |   | 62,773                  |  
|Additional
      paid-in capital                              |           | 18,736,200          |   |           |   | 18,736,200              |  
|Accumulated other
      comprehensive income (loss)           |           | 143,682             |   |           |   | 149,900                 |  
|Deficit                                                       |           | (23,777,042         | ) |           |   | (23,229,804             | )
|                                                              |           |                     |   |           |   |                         |  
|Total Stockholders
      Equity (Deficit)                    |           | (4,834,387          | ) |           |   | (4,280,931              | )
|                                                              |           |                     |   |           |   |                         |  
|Total Liabilities
      and Stockholders Equity (Deficit)    | $         | 5,009,233           |   |           | $ | 3,330,243               |  
|                                                              |           |                     |   |           |   |                         |  
|                                                              |           |                     |   |           |   |                         |  
|Contingencies (Notes
      1 and 23)                          |           |                     |   |           |   |                         |  
|Subsequent Events
      (Note 24)                             |           |                     |   |           |   |                         |  



(The accompanying
  notes are an integral part of these consolidated financial statements)

---

**___________________________________________________________________________________________________________________________**AUCXIS
  CORP.**(****formerly
  e-Auction Global Trading Inc.)**

**CONSOLIDATED
  STATEMENTS OF OPERATIONS, DEFICIT AND COMPREHENSIVE LOSS**

**(in U.S. dollars)**__________________________________________________________________________________________________________________________

SIX MONTHS
  ENDED JUNE 30, 2002__________________________________________________________________________________________________________________________

|                                                                                     |          | Six
      months |   |            | Six
      months |   |          | Three
      months |   |            | Three
      months |  
|------------------------------------------------------------------------------------ | -------- | ---------------- | - | ---------- | ---------------- | - | -------- | ------------------ | - | ---------- | ------------------ | -
|                                                                                     |          | ended            |   |            | ended            |   |          | ended              |   |            | ended              |  
|                                                                                     |          | June
      30,   |   |            | June
      30,   |   |          | June
      30,     |   |            | June
      30,     |  
|                                                                                     |          | 2002             |   |            | 2001             |   |          | 2002               |   |            | 2001               |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|Revenue                                                                              | $        | 2,610,771        |   | $          | 3,587,000        |   | $        | 1,302,259          |   | $          | 1,620,834          |  
|Cost
      of goods sold                                                             |          | (1,319,344       | ) |            | (1,745,535       | ) |          | (729,273           | ) |            | (743,844           | )
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|                                                                                     |          | 1,291,427        |   |            | 1,841,656        |   |          | 572,986            |   |            | 876,990            |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|Selling,
      general and administrative expense                                    |          | 1,609,068        |   |            | 4,205,219        |   |          | 820,463            |   |            | 1,686,453          |  
|Depreciation
      and amortization expense                                          |          | 121,930          |   |            | 1,392,433        |   |          | 39,005             |   |            | 654,601            |  
|Research
      and development                                                       |          | -                |   |            | 973,915          |   |          | -                  |   |            | 558,650            |  
|Write
      off of required workforce and technology                                 |          | -                |   |            | 806,676          |   |          | -                  |   |            | 806,676            |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|                                                                                     |          | 1,730,998        |   |            | 7,378,243        |   |          | 859,468            |   |            | 3,706,380          |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|Loss
      before the under-noted                                                    |          | (439,571         | ) |            | (5,536,587       | ) |          | (286,482           | ) |            | (2,829,390         | )
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|Share
      of income (loss) of equity investment                                    |          | -                |   |            | 90,048           |   |          | 1,740              |   |            | (87,983            | )
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|Interest
      income                                                                |          | -                |   |            | 121,648          |   |          | -                  |   |            | 26,805             |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|Loss
      on sales and write down of assets                                         |          | (115,772         | ) |            | -                |   |          | (886               | ) |            | -                  |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|Loss before
      income taxes and non-controlling interest                          | (555,343 | )                |   | (5,324,891 | )                |   | (285,628 | )                  |   | (2,890,568 | )                 
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                   
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|Income
      tax recovery (expense)                                                  |          | 8,105            |   |            | 4,490            |   |          | 30,901             |   |            | 6,337              |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|Non-controlling
      interest                                                       |          | -                |   |            | (2,694           | ) |          | -                  |   |            | (2,694             | )
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|Loss
      for the period                                                            |          | (547,238         | ) |            | (5,323,095       | ) |          | (254,727           | ) |            | (2,886,925         | )
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|Deficit
      beginning of period                                                    |          | (23,229,804      | ) |            | (8,258,366       | ) |          | (23,522,315        | ) |            | (10,694,536        | )
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|Deficit
      end of period                                                          |          | (23,777,042      | ) |            | (13,581,461      | ) |          | (23,777,042        | ) |            | (13,581,461        | )
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|Basis
      loss per share                                                           | $        | (0.01            | ) | $          | (.08             | ) | $        | (0.01              | ) | $          | (0.05              | )
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|Loss
      for the period                                                            | $        | (547,238         | ) | $          | (5,232,895       | ) | $        | (254,727           | ) | $          | (2,886,925         | )
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|Foreign
      currency translation adjustments and                                   |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|other
      comprehensive income (loss)                                              |          | (6,218           | ) |            | 158,235          |   |          | (8                 | ) |            | 93,649             |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|Comprehensive
      loss                                                             | $        | (553,456         | ) | $          | (5,164,860       | ) | $        | (255,019           | ) | $          | (2,793,276         | )
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|Shares
      used in computing basic earnings per share                              |          | 62,738,926       |   |            | 62,714,551       |   |          | 62,738,926         |   |            | 62,714,551         |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|                                                                                     |          |                  |   |            |                  |   |          |                    |   |            |                    |  
|(Diluted
      loss per share has not been presented as the result is anti-dilutive)

(The accompanying
  notes are an integral part of these consolidated financial statements)

---

__________________________________________________________________________________________________________________________
  AU**CXIS
  CORP.****(formerly
  e-Auction Global Trading Inc.)**

**CONSOLIDATED
  STATEMENTS OF CASH FLOWS**

**(in U.S. dollars)**__________________________________________________________________________________________________________________________

|SIX
      MONTHS ENDED JUNE 30                                             |   | 2002     |   |   | 2001       |  
|-------------------------------------------------------------------------- | - | -------- | - | - | ---------- | -
|                                                                           |   |          |   |   |            |  
|                                                                           |   |          |   |   |            |  
|                                                                           |   |          |   |   |            |  
|OPERATING ACTIVITIES                                                       |   |          |   |   |            |  
|Loss for the period                                                        | $ | (547,238 | ) | $ | (5,323,095 | )
|Adjustments to reconcile
      net loss to cash                            |   |          |   |   |            |  
|Depreciation
      and amortization                                        |   | 121,930  |   |   | 1,392,433  |  
|Foreign
      exchange                                                     |   | 35,466   |   |   | (49,111    | )
|Stock
      options issued to non-employees                                |   |         |   |   | 4,795      |  
|Share
      of loss of equity investment                                   |   |         |   |   | (90,048    | )
|Provision
      for impairment                                             |   | 82,003   |   |   | 806,676    |  
|Loss
      on sale of assets and other                                     |   | 33,769   |   |   | 2,694      |  
|Net change in non-cash
      working capital items (Note 19)               |   | (109,637 | ) |   | 3,497      |  
|                                                                           |   |          |   |   |            |  
|CASH USED IN OPERATING
      ACTIVITIES                                    |   | (383,707 | ) |   | (3,252,159 | )
|                                                                           |   |          |   |   |            |  
|                                                                           |   |          |   |   |            |  
|FINANCING ACTIVITIES                                                       |   |          |   |   |            |  
|Bank indebtedness                                                          |   |         |   |   | (9,784     | )
|Related party repayments                                                   |   |         |   |   | (820,214   | )
|Long-term debt (repayment)                                                 |   | 349,739  |   |   | 149,102    |  
|                                                                           |   |          |   |   |            |  
|CASH PROVIDED BY
      (USED IN) FINANCING ACTIVITIES                      |   | 349,739  |   |   | (680,896   | )
|                                                                           |   |          |   |   |            |  
|                                                                           |   |          |   |   |            |  
|INVESTING ACTIVITIES                                                       |   |          |   |   |            |  
|Purchase of property,
      plant and equipment (net of disposal proceeds) |   | (1,440   | ) |   | (486,649   | )
|                                                                           |   |          |   |   |            |  
|                                                                           |   |          |   |   |            |  
|CASH USED IN INVESTING
      ACTIVITIES                                    |   | (1,440   | ) |   | (486,649   | )
|                                                                           |   |          |   |   |            |  
|                                                                           |   |          |   |   |            |  
|INCREASE (DECREASE)
      IN CASH AND CASH EQUIVALENTS                     |   |          |   |   |            |  
|DURING THE PERIOD                                                          |   | (35,408  | ) |   | (4,419,704 | )
|                                                                           |   |          |   |   |            |  
|EFFECT OF FOREIGN
      EXCHANGE ON CASH                                   |   | 31,044   |   |   | (55,981    | )
|                                                                           |   |          |   |   |            |  
|CASH AND CASH EQUIVALENTS
      BEGINNING OF PERIOD                        |   | 310,050  |   |   | 6,205,169  |  
|                                                                           |   |          |   |   |            |  
|                                                                           |   |          |   |   |            |  
|CASH AND CASH EQUIVALENTS
      END OF PERIOD                              | $ | 305,686  |   | $ | 1,729,484  |  
|                                                                           |   |          |   |   |            |  
|                                                                           |   |          |   |   |            |  
|Supplemental cash
      flow information:                                  |   |          |   |   |            |  
|                                                                           |   |          |   |   |            |  
|Interest paid                                                              | $ | 16,851   |   | $ |           |  
|Taxes paid                                                                 | $ | 8,105    |   | $ |           |  

(The accompanying notes are an integral part of these consolidated financial
  statements)

---

__________________________________________________________________________________________________________________________AUCXIS CORP.**(formerly
  e-Auction Global Trading Inc.)**NOTES
  TO THE CONSOLIDATED FINANCIAL STATEMENTS**(in
  U.S. dollars)**__________________________________________________________________________________________________________________________

SIX MONTHS
  ENDED JUNE 30, 2002 AND YEAR ENDED DECEMBER 31, 2001__________________________________________________________________________________________________________________________

1.NATURE
  OF OPERATIONS AND CONTINUANCE OF BUSINESS

> Aucxis Corp. (the Company)
>     changed its name from e-Auction Global Trading Inc. in June 2001.
>   The
>     Company is currently developing e-business services for the perishable commodity
>     marketplace primarily in Europe. In addition, through its subsidiary, Aucxis
>     Trading Solutions N.V. (ATS) (formerly Schelfhout Computer Systemen N.V.),
>     the Company is engaged in the installation and maintenance of auction clock
>     and cooling systems for traditional auction halls and the development of software
>     for auctions, including Internet-based auction systems. To date the Company
>     has not earned significant revenue from its Internet -based auction systems
>     and the success of these systems will depend upon market acceptance of a commercially
>     viable prototype and obtaining adequate resources to complete and implement
>     these systems. The Company is not yet able to determine whether these efforts
>     will be successful.
>   In
>     September 2001, the Company decided to discontinue its financial support for
>     its subsidiaries in The Netherlands, including V-Wholesale N.V., Kwatrobox
>     B.V., Palm Verlingsystemen B.V., Scoop Software B.V., Automatiseringsbureau
>     Palm N.V., and Nieaf Systems B.V. (together Kwatrobox) as the
>     businesses operated by these companies no longer form part of the companys
>     refocused business strategy. As a result, Kwatrobox and its operating subsidiaries,
>     Automatiseringsbureau Palm N.V. and Nieaf Systems B.V., filed for bankruptcy
>     and under the bankruptcy laws of the Netherlands, a trustee took control of
>     Kwatrobox and its subsidiaries in October 2001.
>   The
>     Company has a serious working capital deficiency as at June 30, 2002 and has
>     suffered recurring operating losses and has an accumulated deficit as at June
>     30, 2002. These factors raise substantial doubt about the ability of the Company
>     to continue as a going concern.
>   The
>     ability of the Company to continue as a going concern is dependent upon effective
>     implementation of revenue and cost management alternatives and the success
>     of potential future external financing initiatives.
>   Management
>     is considering various revenue and cost management alternatives and is examining
>     a variety of options to raise additional financing, including the possibility
>     of merging the Companys operations with another company. It is not possible
>     at this time to predict with any assurance the success of these initiatives.

2.BASIS
  OF PRESENTATION

> These
>     financial statements consolidate the accounts of the Company, Aucxis Corp.
>     (Nevada) and its wholly-owned subsidiaries as follows:
>   Aucxis N.V. (Belgium)Aucxis Trading
>       Solutions N.V. (formerly Schelfhout Computer Systemen N.V. (Belgium 
>       92.5% owned by Aucxis N.V.)
>       I-Three Inc. 
>       e-Auction Global Trading Inc. (Barbados) 
>       Aucxis Corp. (Canada)
>   The
>     June 30, 2001 comparative figures also include the Netherlands subsidiaries
>     described in Note 1 as these entities were controlled by the Company at that
>     time.
>   These
>     financial statements also include the accounts of Scoop Software B.V. (Netherlands)
>     which is 80% owned.
>   The
>     financial statements also include the Companys share of the net assets
>     and earnings or loss of the Companys 48.2% investment in Aucxis Limited
>     (Australia) and 40% (2001  100%) investment in SDL Invest N.V. (Belgium)
>     which are accounted for by the equity method.

---

__________________________________________________________________________________________________________________________AUCXIS CORP.**(formerly
  e-Auction Global Trading Inc.)****NOTES
  TO THE CONSOLIDATED FINANCIAL STATEMENTS(in U.S.
  dollars)**__________________________________________________________________________________________________________________________

SIX MONTHS
  ENDED JUNE 30, 2002 AND YEAR ENDED DECEMBER 31, 2001__________________________________________________________________________________________________________________________



3.SUMMARY
  OF SIGNIFICANT ACCOUNTING POLICIES

> (a)   Foreign
>     exchange translation
>   The
>       Companys functional currency is U.S. dollars, except that its main
>       operating subsidiaries function in Netherland guilders and euros. Foreign
>       denominated non-monetary assets, liabilities and other items are measured
>       in U.S. dollars using the exchange rate prevailing at the respective transaction
>       dates. Monetary assets and liabilities denominated in foreign currencies
>       are measured at exchange rates prevailing at the balance sheet date. Resulting
>       remeasurement adjustments are included in income. The Company applies the
>       current exchange rate to translate the operating subsidiaries assets
>       and liabilities and average exchange rate for the year to translate revenues,
>       expenses and gains and losses, into U.S. dollars. The resulting translation
>       adjustments are included as a separate component of comprehensive loss within
>       shareholders equity.
>   (b)   Financial
>     instruments
>   The
>       Companys financial instruments consist of cash and cash equivalents
>       and bank indebtedness, accounts receivable, accounts payable and accrued
>       liabilities amounts, due to related parties, deferred revenue, long-term
>       debt and contingencies. The fair values of these financial instruments approximate
>       their carrying values due to their short-term nature and normal trade terms.
>   (c)   Property,
>     plant and equipment
>   Property,
>       plant and equipment are recorded at cost less accumulated depreciation.
>       Property, plant and equipment are depreciated from the date of acquisition
>       using the following rates and methods:

| | Building               | 40 years | straight-line
| | ---------------------- | -------- | -------------
| | Furniture and fixtures | 10 years | straight-line
| | Leaseholds             | 4 years  | straight-line
| | Tools and equipment    | 5 years  | straight-line
| | Vehicles               | 5 years  | straight-line
| | Software               | 5 years  | straight-line

> (d)  Acquired
>     workforce
>   Acquired
>       workforce is recorded at cost and amortized on a straight-line basis over
>       its expected life of approximately five years. Acquired workforce related
>       to I-Three Inc. was written off in the third quarter of 2001.
>   (e)   Acquired
>     core technology
>   Acquired
>       core technology is recorded at cost and amortized on a straight-line basis
>       over its expected life of approximately five years. Acquired core technology
>       related to I-Three Inc. was written off in the third quarter of 2001.

---

__________________________________________________________________________________________________________________________AUCXIS CORP.**(formerly
  e-Auction Global Trading Inc.)****NOTES
  TO THE CONSOLIDATED FINANCIAL STATEMENTS(in U.S.
  dollars)**__________________________________________________________________________________________________________________________

SIX MONTHS
  ENDED JUNE 30, 2002 AND YEAR ENDED DECEMBER 31, 2001__________________________________________________________________________________________________________________________



3.SUMMARY
  OF SIGNIFICANT ACCOUNTING POLICIES (continued)

> (f)   Goodwill
>   Goodwill
>       represents the costs of acquired businesses in excess of the fair values
>       of the net identifiable assets acquired and is amortized on a straight-line
>       basis over its expected life of five years.
>     Late
>       in 2001, the Company wrote off the remaining goodwill related to its acquisition
>       of Kwatrobox as the Company discontinued its financial support for the business
>       operated by Kwatrobox as described in Notes 1, 4(b) and 11.
>     Late
>       in 2001, the Company also wrote off the remaining goodwill related to its
>       acquisition of ATS (formerly Schelfhout Computer Systemen N.V.) as the Company
>       no longer considered the carrying amount of this portion of the goodwill
>       to represent the amount by which the fair value of ATS exceeded the fair
>       value of its net identifiable assets as described in Notes 4(a) and 11.
>   (g)
>       Impairment of long-lived assets
>   The
>       Company evaluates potential impairment of its long-lived assets whenever
>       events or changes in circumstances indicate doubts about the recoverability
>       of such assets. Recoverability of assets held and used is measured by comparing
>       the carrying amount of the asset to estimated future net undiscounted cash
>       flows expected to be generated by the asset. If an asset is considered to
>       be impaired, the impairment is recognized based on the amount by which the
>       carrying amount of the asset exceeds its estimated fair value. Assets to
>       be disposed of are reported at the lower of the carrying amount or fair
>       value. Fair value is based on the amount of consideration which would be
>       paid by an arms length party under no compulsion to transact.
>   (h)   Internal
>     use software
>   The
>       company has acquired and is developing software for internal use in its
>       e-business services. As the company is still in the preliminary stages of
>       developing its e-business services all related costs have been expensed
>       in the year.
>   (i)   Income
>     taxes
>   The
>       company provides for income taxes under the asset and liability method in
>       accordance with Statement of Financial Accounting Standard No. 109, Accounting
>       for Income Taxes. Under this method, deferred tax assets and liabilities
>       are determined based on differences between the financial reporting and
>       income tax bases of assets and liabilities and are measured using enacted
>       tax rates and laws. Valuation allowances are established, when necessary,
>       to reduce deferred tax assets to the amounts which are more likely than
>       not to be realized. To date, the companys deferred tax assets, relating
>       primarily to losses carried forward, have not been considered more likely
>       than not to be realized and, accordingly, a valuation allowance equal to
>       the deferred tax assets has been recorded.
>   (j)   Revenue
>     recognition
>   The
>       Company derives revenue from the development and installation of clock systems,
>       cooling installations and maintenance services related to these systems.
>       Clock and cooling installations take three to four months to complete and
>       are accounted for using the percentage of completion method in accordance
>       with Statement of Position 81.-1. Revenue from contracts with customers
>       that include customer acceptance provisions that are not confirmed until
>       delivery and installation of the systems is recognized when the installation
>       is complete and customer acceptance has occurred under the completed contract
>       method of accounting.

---

__________________________________________________________________________________________________________________________AUCXIS CORP.**(formerly
  e-Auction Global Trading Inc.)****NOTES
  TO THE CONSOLIDATED FINANCIAL STATEMENTS(in U.S.
  dollars)**__________________________________________________________________________________________________________________________

SIX MONTHS
  ENDED JUNE 30, 2002 AND YEAR ENDED DECEMBER 31, 2001__________________________________________________________________________________________________________________________





3.SUMMARY
  OF SIGNIFICANT ACCOUNTING POLICIES (continued)

> (j)   Revenue
>     recognition (continued)
>   Revenue
>       from the sale of customized hardware and software applications is recognized
>       when a formal arrangement exists, the price is fixed or determinable, the
>       delivery is completed and collectibility is reasonably assured.
>     Maintenance
>       contracts to service installed clock and cooling systems are sold separately
>       from these systems. Revenue from maintenance contracts is recognized rateably
>       over the contract period during which services are performed, as vendor
>       specific objective evidence of fair value for maintenance service is obtained.
>   (k)   Inventory
>   Inventory
>       is stated at the lower of cost or net realizable value with cost being determined
>       using the weighted average cost method. Obsolete or defective inventories
>       are reduced to net realizable value.
>     The
>       work-in-progress inventory represents direct costs, including raw materials,
>       labour and an allocation of overhead.
>   (l)   Stock
>     options
>   SFAS
>       No. 123, Accounting for Stock-Based Compensation, requires that
>       stock awards granted be recognized as compensation expense based on their
>       fair values at the date of grant. Alternatively, a company may account for
>       granted stock awards under Accounting Principles Board Opinion (APB) No.
>       25, Accounting for Stock Issued to Employees, and disclose pro
>       forma income amounts which would have resulted from recognizing such awards
>       at their fair value. The Company has elected to account for stock-based
>       compensation for employees under APB No. 25 and make the required pro forma
>       disclosures for compensation expense. Stock based compensation for non-employees
>       are accounted for using SFAS No. 123.
>     The
>       Company has modified the terms of its option plan for certain employees
>       and, in accordance with Financial Accounting Standards Board Interpretation
>       No. 44 (FIN 44), Accounting for Certain Transactions Involving Stock Compensation,
>       the Company has adopted variable plan accounting for these options. Under
>       variable plan accounting, compensation expense is calculated and recorded
>       each period from the date of modification to the date of measurement.
>   (m)   Cash
>     and cash equivalents
>   Cash
>       and cash equivalents consist of cash on deposit and highly liquid short-term,
>       interest bearing securities, having original terms to maturity of three
>       months or less.
>   (n)   Warranty
>     provision
>   One
>       of the Companys subsidiaries provides a warranty for some of the products
>       sold. A provision for estimated warranty costs is charged to operations
>       on the basis of managements estimate of costs to be incurred servicing
>       warranty claims.
>   (o)   Use
>     of estimates
>   The
>       preparation of financial statements in conformity with United States generally
>       accepted accounting principles requires management to make estimates and
>       assumptions that affect the reported amounts of assets and liabilities and
>       disclosures of contingent liabilities at the date of the financial statements
>       and the reported amounts of revenues and expenses during the reporting period.
>       Financial results as determined by actual events could differ from those
>       estimates.

---

__________________________________________________________________________________________________________________________AUCXIS CORP.**(formerly
  e-Auction Global Trading Inc.)****NOTES
  TO THE CONSOLIDATED FINANCIAL STATEMENTS(in U.S.
  dollars)**__________________________________________________________________________________________________________________________

SIX MONTHS
  ENDED JUNE 30, 2002 AND YEAR ENDED DECEMBER 31, 2001__________________________________________________________________________________________________________________________



3.SUMMARY
  OF SIGNIFICANT ACCOUNTING POLICIES (continued)

> (p)   Comparative
>     figures
>   Certain
>       amounts in the financial statements have been reclassified to be consistent
>       and comparable from year-to-year.

4.ACQUISITIONS
  AND IMPAIRMENT OF ACQUIRED ASSETS

> (a)   ATS
>     (formerly Schelfhout Computer Systemen N.V.)
>   On
>       January 10, 2000, the Company completed and closed the purchase of 100%
>       of the issued and outstanding shares of ATS (formerly Schelfhout Computer
>       Systemen N.V.), a Belgian company that supplies clocks and cooling systems
>       to auction houses. The Company acquired the shares of ATS in exchange for
>       3,636,364 shares of common stock and cash of $4,000,000. The shares of common
>       stock were valued at $3,636,364, based on their estimated fair value at
>       January 10, 2000. Fair value was determined based on the cash price paid
>       for stock in a contemporaneous private placement, the put feature related
>       to the shares issued to acquire ATS and the market price of the Companys
>       stock around the acquisition date.
>     Under
>       the terms of the purchase agreement, the vendors agreed not to sell or transfer
>       any of their shares except on the basis of a time release formula which
>       presumes that the shares will be freely tradable at the time of release
>       for sale or transfer.
>     The
>       terms of the purchase agreement also provide the vendors with a put feature
>       which allows the vendors to sell the shares back to the Company at $1.65
>       per share at the time of release if they are not freely tradable.
>     Under
>       the time release formula, 454,545 shares are to be released on each of the
>       6, 12, 18 and 24 month anniversary dates of the closing and 606,061 shares
>       are to be released on each of the 36, 48 and 60 month anniversary dates
>       of the closing.
>     Since
>       the 3,636,364 shares issued to the vendors are subject to the put feature
>       described above, which is beyond the Companys direct control, they
>       have been classified as mandatory redeemable shares of common stock. During
>       2001, the Company accreted $243,817 to the mandatory redeemable shares of
>       common stock all of which was recognized in the last quarter of 2001.
>     The
>       first 454,545 shares were not free trading on July 10, 2000, the six-month
>       anniversary date of the acquisition and during 2001 the vendors sought to
>       exercise their right to retract 909,090 shares, representing the first two
>       tranchees under the time release agreement, on the basis that they were
>       not free trading on their respective release dates (see also Note 234(d)).
>     In
>       December 2001, the Company wrote off the net carrying value of goodwill
>       of $3,924,267 related to the ATS acquisition as the Company no longer considered
>       the carrying amount of this goodwill to represent the amount by which the
>       fair value of ATS exceeded the fair value of its net identifiable assets
>       (see Note 11).

---

__________________________________________________________________________________________________________________________AUCXIS CORP.**(formerly
  e-Auction Global Trading Inc.)********NOTES
  TO THE CONSOLIDATED FINANCIAL STATEMENTS(in U.S.
  dollars)**__________________________________________________________________________________________________________________________

SIX MONTHS
  ENDED JUNE 30, 2002 AND YEAR ENDED DECEMBER 31, 2001__________________________________________________________________________________________________________________________



4.ACQUISITIONS
  AND IMPAIRMENT OF ACQUIRED ASSETS (continued)

> (b)   Purchase
>     of Kwatrobox B.V.
>   Effective
>       November 1, 2000, the Company acquired 100% of the issued and outstanding
>       shares of Kwatrobox B.V. (Kwatrobox), a provider of electronic
>       auction infrastructure and enterprise resource planning software, for cash
>       of $1,573,250 and 1,250,000 shares of the Company plus performance related
>       contingent consideration of up to 200,000 shares of common stock of the
>       Company. Total consideration, excluding the contingently issueable shares
>       was $2,883,250.
>     750,000
>       of the shares issued upon closing on November 1, 2000, were held in escrow
>       subject to a time release arrangement; 150,000 of which remain to be released
>       on June 5, 2002.
>     The
>       performance shares were contingent upon Kwatrobox and its subsidiaries earning
>       combined pre-tax income of between $1.0 million and $1.4 million for the
>       period commencing on June 5, 2000 and ending July 4, 2003. No additional
>       consideration is required where pre-tax earnings are less than $1 million
>       for this period. The performance shares were not included in the purchase
>       consideration at the time of purchase. Any additional consideration arising
>       after the purchase was to be based on the fair value of the shares to be
>       issued at that time and was to be recorded as an increase in goodwill.
>     In
>       September 2001, the Company decided to discontinue its financial support
>       for Kwatrobox B.V. and its Netherlands subsidiaries as described in Note
>       1. As a result, the Company wrote off a net asset deficiency of $445,989
>       and goodwill of $3,386,785 related to Kwatrobox and its subsidiaries.
>     Although
>       Kwatrobox and its primary operating subsidiaries have filed for bankruptcy
>       and a trustee has been appointed pursuant to the Netherlands bankruptcy
>       laws, the Companys management believes that the Company is not exposed
>       to further claims by creditors of Kwatrobox and its subsidiaries and no
>       amounts have been accrued in these financial statements for such claims.
>   (c)   Purchase
>     of I-Three Inc.
>   On
>       November 27, 2000, the Company acquired 100% of the issued and outstanding
>       shares of I-Three Inc. in exchange for 455,000 shares of the Company. I-Three
>       Inc. specialized in real-time, business-to-business infrastructure technology.
>       The total consideration paid was $218,400.
>     In
>       June 2001, the Company determined that the acquired workforce and acquired
>       core technology obtained through the acquisition of I-Three Inc. would be
>       terminated and abandoned respectively. As a result, the Company wrote off
>       acquired workforce of $144,461 and goodwill of $563,211 related to I-Three
>       Inc.
>     On
>       August 29, 2001, the Company made an agreement with BoomBoat Inc. (BoomBoat)
>       whereby the Company paid BoomBoat to take over I-Three Inc.s operations
>       and employees paying BoomBoat a one-time fee of $181,943. In exchange, BoomBoat
>       agreed to pay the Company, a royalty of 1% of revenues received from August
>       30, 2001 up to and including August 29, 2006 and the employees waived any
>       dismissal rights contained in their contracts. I-Three Inc. retained the
>       rights to its technology and intellectual property.

---

__________________________________________________________________________________________________________________________AUCXIS CORP.**(formerly
  e-Auction Global Trading Inc.)****NOTES
  TO THE CONSOLIDATED FINANCIAL STATEMENTS(in U.S.
  dollars)**__________________________________________________________________________________________________________________________

SIX MONTHS
  ENDED JUNE 30, 2002 AND YEAR ENDED DECEMBER 31, 2001__________________________________________________________________________________________________________________________

4.ACQUISITIONS
  AND IMPAIRMENT OF ACQUIRED ASSETS (continued)

> (d)   Impairment
>     of goodwill, acquired workforce and acquired core technology
>   The
>       impairment provision for the year ended December 31, 2001 for goodwill,
>       acquired workforce and acquired core technology is comprised as follows:

| | Goodwill
      for ATS                                   | $ | 3,924,267 |  
| | -------------------------------------------------------- | - | --------- | -
| | Goodwill for Kwatrobox                                   |   | 3,386,785 |  
| | Acquired workforce
      for I-Three Inc.                |   | 144,461   |  
| | Acquired core technology
      for I-Three Inc.          |   | 563,211   |  
| | Less gain on disposal
      of other identifiable assets |   |           |  
| | and
      liabilities for Kwatrobox                      |   | (445,989  | )
| |                                                          |   |           |  
| |                                                          | $ | 7,572,735 |  
| |                                                          |   |           |  

5.ACCOUNTS RECEIVABLE

> Accounts receivable
>     consists of the following amounts:
>   June
>         30,2002
>       
>       
>       
>       December
>         31, 2001Accounts receivable
>       $
>       1,562,894
>       
>       
>       $
>       1,243,188Allowance for doubtful
>         accounts
>       
>       
>       
>       
>       
>       (12,840
>       )$
>       1,562,894
>       
>       
>       $
>       1,230,348

6.INVENTORY

> Inventory consists
>     of the following:

| |                  |   | June
      30, |  | December
      31, |        
| | ---------------- | - | -------------- |  | ------------------ | -------
| |                  |   | 2002           |  | 2001               |        
| |                  |   |                |  |                    |        
| | Raw materials    | $ | 489,945        |  | $                  | 235,990
| | Work-in-progress |   | 1,457,369      |  |                    | 45,418 
| | Finished goods   |   | 115,645        |  |                    | 122,902
| |                  |   |                |  |                    |        
| |                  | $ | 2,062,959      |  | $                  | 404,310
| |                  |   |                |  |                    |        

7.INVESTMENT

> During
>     2001, the Company recognized an impairment in the carrying amount of its equity
>     investment in Aucxis Limited (Australia) in the amount of $484,448 because
>     management believed that the Company will not be able to recover its investment
>     in Aucxis Limited (Australia).
>   This
>     impairment is included in share of loss of equity investment for the year
>     ended December 31, 2001. The remaining investments balance consists of the
>     Companys interest in SDL Invest N.V. (Belgium).

---

__________________________________________________________________________________________________________________________AUCXIS CORP.**(formerly
  e-Auction Global Trading Inc.)****NOTES
  TO THE CONSOLIDATED FINANCIAL STATEMENTS(in U.S.
  dollars)**__________________________________________________________________________________________________________________________

SIX MONTHS
  ENDED JUNE 30, 2002 AND YEAR ENDED DECEMBER 31, 2001__________________________________________________________________________________________________________________________



8.PROPERTY,
  PLANT AND EQUIPMENT

|                             |   | Cost    |  |   | AccumulatedDepreciation |  |   | June
      30,2002
      Net Carrying
      Value |  |   | December
      31, 
      2001
      Net Carrying Value | 
|---------------------------- | - | ------- |  | - | ----------------------- |  | - | ------------------------------------------------- |  | - | ------------------------------------------------------- | 
|                             |   |         |  |   |                         |  |   |                                                   |  |   |                                                         | 
|Furniture
      and fixtures | $ | 94,129  |  | $ | 14,000                  |  | $ | 80,129                                            |  | $ | 124,919                                                 | 
|Leaseholds                   |   |         |  |   |                         |  |   |                                                   |  |   | 27,619                                                  | 
|Software                     |   | 288,880 |  |   | 152,225                 |  |   | 136,655                                           |  |   | 157,582                                                 | 
|Tools
      and equipment    |   | 60,808  |  |   | 31,566                  |  |   | 29,242                                            |  |   | 122,761                                                 | 
|Vehicles                     |   | 511,642 |  |   | 275,583                 |  |   | 236,059                                           |  |   | 273,973                                                 | 
|                             |   |         |  |   |                         |  |   |                                                   |  |   |                                                         | 
|                             | $ | 955,459 |  | $ | 473,374                 |  | $ | 482,085                                           |  | $ | 706,854                                                 | 
|                             |   |         |  |   |                         |  |   |                                                   |  |   |                                                         | 

9.   ACQUIRED WORKFORCE

| |                                             |   | June
      30, |  | December
      31, |         
| | ------------------------------------------- | - | -------------- |  | ------------------ | --------
| |                                             |   | 2002           |  | 2001               |         
| |                                             |   |                |  |                    |         
| | Cost                                        | $ |               |  | $                  | 166,898 
| | Accumulated amortization                    |   |               |  |                    | (22,437 
| | Written off I -Three
      Inc. (Note 4(c)) |   |               |  |                    | (144,461
| |                                             |   |                |  |                    |         
| |                                             | $ |               |  | $                  |        
| |                                             |   |                |  |                    |         

10.  ACQUIRED CORE
  TECHNOLOGY

| |                                            |   | June
      30, |   | December
      31, |          
| | ------------------------------------------ | - | -------------- | - | ------------------ | ---------
| |                                            |   | 2002           |   | 2001               |          
| |                                            |   |                |   |                    |          
| | Cost                                       | $ | 748,969        |   | $                  | 1,394,310
| | Accumulated amortization                   |   | (374,484       | ) |                    | (381,718 
| | Written off I-Three
      Inc. (Note 4(c)) |   |               |   |                    | (563,211 
| |                                            |   |                |   |                    |          
| |                                            | $ | 374,485        |   | $                  | 449,381  
| |                                            |   |                |   |                    |          

11.  GOODWILL

| |                                         |   | June
      30, |  | December
      31, |           
| | --------------------------------------- | - | -------------- |  | ------------------ | ----------
| |                                         |   | 2002           |  | 2001               |           
| |                                         |   |                |  |                    |           
| | Cost                                    | $ |               |  | $                  | 10,677,812
| | Accumulated amortization                |   |               |  |                    | (3,366,760
| | Written off ATS (Note
      4(a))       |   |               |  |                    | (3,924,267
| | Written off Kwatrobox
      (Note 4(b)) |   |               |  |                    | (3,386,785
| |                                         |   |                |  |                    |           
| |                                         | $ |               |  | $                  |          
| |                                         |   |                |  |                    |           

---

__________________________________________________________________________________________________________________________AUCXIS CORP.**(formerly
  e-Auction Global Trading Inc.)****NOTES
  TO THE CONSOLIDATED FINANCIAL STATEMENTS****(in
  U.S. dollars)**__________________________________________________________________________________________________________________________

SIX MONTHS
  ENDED JUNE 30, 2002 AND YEAR ENDED DECEMBER 31, 2001__________________________________________________________________________________________________________________________



12.   BANK
  INDEBTEDNESS

> The
>     Companys subsidiary, ATS, has available a bank credit facility of approximately
>     $220,000 (247,000 EUR) which can be used for operating purposes. This credit
>     facility bears interest at the banks base rate plus 1.25% and is secured
>     by a pledge of approximately $90,000 over certain assets of ATS.
>   The
>     Company has executed a postponement agreement in favour of the bank. Under
>     the agreement the Company may not cause the ATS subsidiary to pay dividends
>     to the Company or otherwise make payments to other companies in the group
>     without the consent of the bank.

13.  ACCOUNTS PAYABLE
  AND ACCRUED LIABILITIES

> Accounts payable and
>     accrued liabilities consist of the following:

| |                           |   | June
      30, |  | December
      31, |          
| | ------------------------- | - | -------------- |  | ------------------ | ---------
| |                           |   | 2002           |  | 2001               |          
| |                           |   |                |  |                    |          
| | Trade
      payables      | $ | 761,355        |  | $                  | 853,412  
| | Accrued
      liabilities |   | 283,831        |  |                    | 263,000  
| | Payroll                   |   | 243,494        |  |                    | 346,420  
| |                           |   |                |  |                    |          
| |                           | $ | 1,288,680      |  | $                  | 1,462,832
| |                           |   |                |  |                    |          

14. DUE TO RELATED PARTIES

| |                                            |   | June
      30, |   |   | December
      31, |  
| | ------------------------------------------ | - | -------------- | - | - | ------------------ | -
| |                                            |   | 2002           |   |   | 2001               |  
| |                                            |   |                |   |   |                    |  
| | Due to former Kwatrobox
      shareholders |   | 372,071        |   |   | 352,335            |  
| | Less:Current
      portion                 |   | (372,071       | ) |   | (352,335           | )
| |                                            |   |                |   |   |                    |  
| |                                            | $ |               |   | $ |                   |  
| |                                            |   |                |   |   |                    |  

> The
>     amount due to former Kwatrobox shareholders relates to the acquisition of
>     Kwatrobox from these former shareholders and the balance is non-interest bearing.
>   Included
>     in the accounts payable is $Nil (2001 - $59,000) due to a firm in which a
>     director is a partner.
>   Included
>     in accounts payable is $Nil (2001 - $33,494) due to a company controlled by
>     directors of a subsidiary.

---

__________________________________________________________________________________________________________________________AUCXIS CORP.**(formerly
  e-Auction Global Trading Inc.)****NOTES
  TO THE CONSOLIDATED FINANCIAL STATEMENTS(in U.S.
  dollars)**__________________________________________________________________________________________________________________________

SIX MONTHS
  ENDED JUNE 30, 2002 AND YEAR ENDED DECEMBER 31, 2001__________________________________________________________________________________________________________________________



15.   RELATED
  PARTY TRANSACTIONS

> The
>     Company incurred the following amounts to related parties during the six months
>     period and year ended June 30, 2002 and December 31, 2001 respectively.

| |                                                                         |   | June 30, |  | December 31, |        
| | ----------------------------------------------------------------------- | - | -------- |  | ------------ | -------
| |                                                                         |   | 2002     |  | 2001         |        
| |                                                                         |   |          |  |              |        
| | Management fees to
      companies controlled by former directors       | $ |         |  | $            | 242,975
| |                                                                         |   |          |  |              |        
| | Professional fees
      paid to a firm in which a director is a partner |   | 21,000   |  |              | 59,000 
| |                                                                         |   |          |  |              |        
| | Administration fees
      to a company with common directors            |   | 96,047   |  |              | 38,391 
| |                                                                         |   |          |  |              |        
| | Consulting fees to
      a company controlled by a director             |   | 41,000   |  |              | 61,150 
| |                                                                         |   |          |  |              |        
| | Consulting fees paid
      to company controlled by the directors       |   |          |  |              |        
| | of a subsidiary                                                         |   |         |  |              | 148,690
| |                                                                         |   |          |  |              |        
| | Rent paid to SDL
      Invest N.V. (Belgium)                            |   | 48,942   |  |              | 87,140 

16. LONG-TERM DEBT

| |                               |   | June
      30, |  | December
      31, |        
| | ----------------------------- | - | -------------- |  | ------------------ | -------
| |                               |   | 2002           |  | 2001               |        
| |                               |   |                |  |                    |        
| | Convertible bridge
      loan | $ | 379,674        |  | $                  | -      
| |                               |   |                |  |                    |        
| | Vehicle loans                 |   | 224,763        |  |                    | 254,698
| |                               |   |                |  |                    |        
| | Less:Current
      portion    |   | 469,382        |  |                    | 89,055 
| |                               |   |                |  |                    |        
| | Long-term debt                | $ | 135,055        |  | $                  | 165,643
| |                               |   |                |  |                    |        

> The
>     vehicle loans have interest rates ranging from 3.67% to 8.82%, and maturity
>     dates ranging from June 2002 through May 2006, and are secured by the related
>     vehicles.
>   The debt repayments
>     over the next five years are as follows:

| | 2002 |  | $ | 29,009  | 
| | ---- |  | - | ------- | 
| | 2003 |  |   | 92,102  | 
| | 2004 |  |   | 59,454  | 
| | 2005 |  |   | 35,159  | 
| | 2006 |  |   | 9,039   | 
| |      |  |   |         | 
| |      |  | $ | 224,763 | 
| |      |  |   |         | 

> The
>     weighted average interest rate on borrowings is approximately 6.5%.
>   On
>     April 16, 2002, the Company and three lenders, ABN Capital (Belgium) NV, Bodin
>     Saphir Pension Scheme, and J.J. Mennillo, entered into a Convertible Bridge
>     Loan Agreement for $125,000 each, representing an aggregate loan by the lenders
>     to the Compnay of $375,000. The Company and lenders placed the loan in escrow.
>     The loan bears interest at a rate at 12.5% per annum, which accrues until
>     the loan is repaid or converted to shares. Subject to certain terms and conditions
>     of this agreement, each of the lenders is entitled to convert only such amounts
>     as have been drawn down from its respective part of the principal of the loan
>     into shares at $.01 per share. Interest has been capitalized to the loan balances.

---

__________________________________________________________________________________________________________________________AUCXIS CORP.**(formerly
  e-Auction Global Trading Inc.)****NOTES
  TO THE CONSOLIDATED FINANCIAL STATEMENTS(in U.S.
  dollars)**__________________________________________________________________________________________________________________________

SIX MONTHS
  ENDED JUNE 30, 2002 AND YEAR ENDED DECEMBER 31, 2001__________________________________________________________________________________________________________________________

17. INCOME TAXES

> The
>     Company has adopted the provisions of Financial Accounting Standards Board
>     Statement No. 109 (SFAS 109), Accounting for Income Taxes.
>   Pursuant
>     to SFAS 109, the Company is required to compute tax asset benefits for net
>     operating losses carried forward. The potential tax benefit of net operating
>     losses has not been recognized in the financial statements because the Company
>     cannot be assured that it is more likely than not that it will utilize the
>     net operating losses carried forward in future years.
>   The
>     Company has U.S. and European tax losses of approximately $18,000,000 to offset
>     future years taxable income. These losses expire between fiscal 2014 and fiscal
>     2016.
>   The
>     components of the net deferred tax asset, the statutory tax rate, the effective
>     tax rate and the elected amount of the valuation allowance are outlined below:

| |                                                       | Period
      ended |                | Year
      ended |                   
| | ----------------------------------------------------- | ------------------ | -------------- | ---------------- | ------------------
| |                                                       |                    | June
      30, |                  | December
      31,
| |                                                       |                    | 2002           |                  | 2001              
| |                                                       |                    |                |                  |                   
| |                                                       |                    |                |                  |                   
| | Net combined U.S.
      and European operating losses | $                  | 18,500,000     |                  | $                 
| |                                                       |                    |                |                  |                   
| | Statutory combined
      U.S. and European tax rate   |                    | 35             | %                |                   
| |                                                       |                    |                |                  |                   
| | Effective tax rate                                    |                    |               |                  |                   
| |                                                       |                    |                |                  |                   
| | Deferred tax asset                                    |                    | 6,475,000      |                  |                   
| |                                                       |                    |                |                  |                   
| | Valuation allowance                                   |                    | (6,475,000     | )                |                   
| |                                                       |                    |                |                  |                   
| | Net deferred tax
      asset                          | $                  |               |                  | $                 
| |                                                       |                    |                |                  |                   

18.  COMMON STOCK

| |                                                   | Number
        of Shares | Par
        Value
        ($0.001) |   | Additional
        Paid-In
        Capital |  | Total
        Value |           
| | ------------------------------------------------- | ------------------------ | ---------------------------------- | - | ------------------------------------------ |  | ------------------- | ----------
| |                                                   |                          |                                    |   |                                            |  |                     |           
| | Balance,
      December 31, 2000                  | 62,714,551               |                                    |   | 62,715                                     |  |                     | 18,735,673
| | Issued
      on exercise of options               | 58,500                   |                                    |   | 58                                         |  |                     | 527       
| |                                                   |                          |                                    |   |                                            |  |                     |           
| |                                                   |                          |                                    |   |                                            |  |                     |           
| | Balance
      December 31, 2001 and June 30, 2002 | 62,773,051               |                                    | $ | 62,773                                     |  | $                   | 18,736,200
| |                                                   |                          |                                    |   |                                            |  |                     |           

| |                                                   |  |  |  |  | Options
      for |       |                      | Weighted |                
| | ------------------------------------------------- |  |  |  |  | ----------------- | ----- | -------------------- | -------- | ---------------
| |                                                   |  |  |  |  | shares
      of   |       |                      | average  |                
| |                                                   |  |  |  |  | common            |       | exercise
      price |         
| |                                                   |  |  |  |  |                   | stock |                      |          | per
      share
| |                                                   |  |  |  |  |                   |       |                      |          |                
| | Balance December
      31, 2000                   |  |  |  |  | 8,213,000         |       |                      | 0.34     |                
| |                                                   |  |  |  |  |                   |       |                      |          |                
| | Exercised                                         |  |  |  |  | (58,500           | )     |                      | .01      |                
| | Cancelled                                         |  |  |  |  | (5,100,000        | )     |                      | .35      |                
| |                                                   |  |  |  |  |                   |       |                      |          |                
| | Balance December
      31, 2001 and June 30, 2002 |  |  |  |  | 3,054,500         |       |                      | .34      |                
| |                                                   |  |  |  |  |                   |       |                      |          |                

> The
>     following table summarizes information about the Companys share options
>     outstanding as at December 31, 2001 and June 30, 2002.

---

__________________________________________________________________________________________________________________________AUCXIS CORP.(formerl**y
  e-Auction Global Trading Inc.)****NOTES
  TO THE CONSOLIDATED FINANCIAL STATEMENTS(in U.S.
  dollars)**__________________________________________________________________________________________________________________________

SIX MONTHS
  ENDED JUNE 30, 2002 AND YEAR ENDED DECEMBER 31, 2001__________________________________________________________________________________________________________________________

18.  COMMON STOCK
  (Continued)

Weighted
        averageExercise
      
      
      
      Remainingprice
      
      Number
        outstanding
      
      contractual
        life
      
      Number
        exercisable$0.01
      
      96,500
      
      2.0
      
      96,500$0.35
      
      2,958,000
      
      9.0
      
      2,958,000


> The
>     following reflects pro-forma net income and loss per share as if the Company
>     had elected to adopt the fair value approach of Statement of Financial Accounting
>     Standard (SFAS) 123:

| |                                        |   | June
      30, | 
| | -------------------------------------- | - | -------------- | 
| |                                        |   | 2002           | 
| |                                        |   |                | 
| |                                        |   |                | 
| | Loss                                   |   |                | 
| | As
      reported                      | $ | 547,238        | 
| | Pro-forma                              |   | 710,000        | 
| |                                        |   |                | 
| | Basic and diluted
      loss per share |   |                | 
| | As
      reported                      |   | .01            | 
| | Pro
      forma                        |   | .01            | 

> The
>     estimated fair value of each option granted was calculated using the Black-Scholes
>     option-pricing model.

19.  CHANGE
  IN NON-CASH WORKING CAPITAL

| |                                                |   | June
      30, |  
| | ---------------------------------------------- | - | -------------- | -
| |                                                |   | 2002           |  
| |                                                |   |                |  
| |                                                |   |                |  
| | Accounts
      receivable                      | $ | (332,546       | )
| | Inventory                                      |   | (1,658,649     | )
| | Prepaid expenses                               |   | 18,587         |  
| | Accounts
      payable and accrued liabilities |   | (174,152       | )
| | Deferred
      items                           |   | 2,037,123      |  
| |                                                |   |                |  
| |                                                | $ | (109,637       | )
| |                                                |   |                |  

20.  SEGMENTED INFORMATION

> The
>     Company operates in one operating segment, this being the installation of
>     auction clocks and cooling systems.
>   Geographic
>     information

| |             |   | June
      30, |  |   | June
      30, | 
| | ----------- | - | -------------- |  | - | -------------- | 
| |             |   | 2002           |  |   | 2001           | 
| |             |   |                |  |   |                | 
| | Revenue     |   |                |  |   |                | 
| | Canada      | $ |               |  | $ | 76,212         | 
| | Belgium     |   | 2,610,771      |  |   | 1,737,452      | 
| | Netherlands |   |               |  |   | 1,773,345      | 
| |             |   |                |  |   |                | 
| |             | $ | 2,610,771      |  | $ | 3,587,009      | 
| |             |   |                |  |   |                | 

---

__________________________________________________________________________________________________________________________AUCXIS CORP.(**formerly
  e-Auction Global Trading Inc.)****NOTES
  TO THE CONSOLIDATED FINANCIAL STATEMENTS(in U.S.
  dollars)**__________________________________________________________________________________________________________________________

SIX MONTHS
  ENDED JUNE 30, 2002 AND YEAR ENDED DECEMBER 31, 2001__________________________________________________________________________________________________________________________



| |                                      |   | June
      30, |  | December
      31, |          
| | ------------------------------------ | - | -------------- |  | ------------------ | ---------
| |                                      |   | 2002           |  | 2001               |          
| |                                      |   |                |  |                    |          
| |                                      |   |                |  |                    |          
| | Identifiable
      long lived assets |   |                |  |                    |          
| | Canada                               | $ | 176,157        |  | $                  | 278,892  
| | Belgium                              |   | 680,413        |  |                    | 877,343  
| | Netherlands                          |   |               |  |                    |         
| |                                      |   |                |  |                    |          
| |                                      | $ | 856,570        |  | $                  | 1,156,235
| |                                      |   |                |  |                    |          

21.  LOSS PER COMMON
  SHARE

> The
>     weighted average number of shares of common stock used for calculating the
>     basic loss per share is 62,738,926 (2001  62,714,551). Fully diluted
>     loss per share is the same as the basic loss per share for the periods ended
>     June 30, 2002 and 2001. Loss per share is determined based on the loss available
>     to common shareholders as presented in the statement of operations, deficit
>     and comprehensive loss.
>   The
>     3,054,500 outstanding stock options are not included in the computation of
>     earnings per share as they are anti-dilutive for the periods presented.

22.  COMMITMENTS

> The
>     Company has future minimum lease payments under operating leases relating
>     to premises at June 30, 2002 as follows:

|2002 |  | $ | 66,750  | 
|---- |  | - | ------- | 
|2003 |  |   | 89,000  | 
|2004 |  |   | 89,000  | 
|2005 |  |   | 89,000  | 
|2006 |  |   | 89,000  | 
|     |  |   |         | 
|     |  | $ | 422,750 | 
|     |  |   |         | 

> In
>     addition, ATS has a potential commitment to sell its 40% interest in SDL Invest
>     at the option of Mrs. Hilde De laet and Mr. Luc Schelfhout under the terms
>     of an option held by them.

23.  CONTINGENCIES

|(a) | Claims
        totalling approximately $800,000 have been made against ATS, the Companys
        main Belgian subsidiary, by a competitor Agro Marches Internationalaux
        S.A. No amounts have beenrecorded
        in these financialstatements
        to provide for any possible settlement of these claims as management is
        unable to determine whether they have merit.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(b) | Certain
        customers of a subsidiary have filed claims totalling $70,000 against
        the subsidiary company. At present, there is insufficient information
        available to ascertain the likelihood of these claims being successful.
        Accordingly, no recognition of this contingent loss has been made.                                                              
|   
|(c) | A
        former employee of I-ThreeInc. has received a judgementfrom
        a Texas court against the Company for approximately $25,000. No
        provision has been made in these financial statements for this judgement
        as management believes this court has no jurisdiction over the matter.                                                                               
|   

---

__________________________________________________________________________________________________________________________AUCXIS CORP.**(formerly
  e-Auction Global Trading Inc.)****NOTES
  TO THE CONSOLIDATED FINANCIAL STATEMENTS(in U.S.
  dollars)**__________________________________________________________________________________________________________________________

SIX
  MONTHS ENDED JUNE 30, 2002 AND YEAR ENDED DECEMBER 31, 2001__________________________________________________________________________________________________________________________



23. CONTINGENCIES (Continued)

|(d) | The
        former owners of the Companys subsidiary, ATS (formerly Schelfhout
        Computer SystemenN.V.),
        sought to enforce themandatory
        redemption feature related to the first two tranchees ofshares
        totalling 909,090 be released under the terms of the purchase agreement
        described inNote
        4(a) on the basis that these shares were not free trading at the time
        of release as contemplated
        in the agreement. The former owners of the Companys subsidiary brought
        anaction
        against the Company to enforce a pledge on the shares of ATS, which was
        provided tosecure
        the obligations of the Company under theagreement.
        This action was heard by a Belgian court which granted a remedy to the
        formerowners
        of the subsidiary which allowed them to re-acquire a 71⁄2% interest
        in the subsidiary fromthe
        Company in exchange for the transfer for cancellation of the first tranche
        of 454,545 shares ofthe
        Company in full satisfaction of the Companys obligations in relation
        to such shares under the agreement.
        No further action has been taken with respect to the second tranche of
        454,545shares
        released on January 10, 2001.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(e) | On
        April 16, 2002, Mr. Schelfhout and Mrs. De Laet filed a request for arbitration
        against AucxisCorp.
        N.V. and the Company.The
        plaintiffs allege that the Company and Aucxis Corp. N.V. deliberately
        committed a numbermisrepresentations
        both prior to and subsequent to the closing the ATS share purchase   agreement.
        They have alleged damages of up to USD 1,190,309 for which they seek to
        be   compensated by Aucxis Corp. N.V. and the Company.
      On
        March 29, 2002 Mr. Schelfhout and Mrs. De Laet brought an ex parteapplication before the   President of the Commercial
        Court of Dendermonde (Belgium), which granted them authorization   to
        apply a restraint order to a portion of the ATS shares held by Aucxis
        Corp. N.V. The Company   appealed this ruling and the Court
        heard these actions on June 25, 2002 and a decision is   expected
        on September 24, 2002.
      The
        Company also brought an action against Mr. Schelfhout and Mrs. De Laet
        relating to   irregularities in discharging their obligations
        as directors of ATS. This action is expected to be   heard
        by the Court on November 12, 2002.
      On
        April 30, 2002, Mr. Schelfhout resigned as the managing director of ATS
        and ceased to   perform the duties required of him under
        his management contract. The Company brought an   action
        against Mr. Schelfout related to his default under a management agreement
        and this   action is expected to be heard on September
        20, 2002.All
        of these proceedings are currently in their initial stages and decisions
        are not expected before   the
        end of the year. Management believes that the claims brought against the
        Company are   without
        merit and does not expect that any impact resulting from them will have
        a material effect   on
        the Company.

24.  SUBSEQUENT
  EVENTS

> Subsequent
>     to December 31, 2001, the Company announced that it had entered into negotiations
>     with a competitor, Agra Marches Internationalaux S.A. to explore a possible
>     merger of the two companies and enter into an non-binding Letter of Intent
>     with Agra Marches Internationalaux S.A. in this regard.
>   During
>     the quarter, management ceased negotiations with Agra Marches Internationaux
>     S.A. as it felt that merging the two companies was not in the best interest
>     of the shareholders at this time.

---

__________________________________________________________________________________________________________________________AUCXIS CORP.**(formerly
  e-Auction Global Trading Inc.)****NOTES
  TO THE CONSOLIDATED FINANCIAL STATEMENTS(in U.S.
  dollars)**__________________________________________________________________________________________________________________________

SIX MONTHS
  ENDED JUNE 30, 2002 AND YEAR ENDED DECEMBER 31, 2001__________________________________________________________________________________________________________________________



25.  NEW ACCOUNTING
  STANDA RDS

> The
>     Company will be required to adopt SFAS 133, Accounting for Derivative Instruments
>     and Hedging Activities for the 2002 fiscal year. At present, the company does
>     not use derivative financial instruments and does not enter into hedging transactions.
>     Therefore, the impact of adopting SFAS 133 on financial reporting will not
>     be material.
>   The
>     Company will also be required to adopt SFAS 142 Goodwill and Other Intangible
>     Assets for its 2002 fiscal year. Based on the Companys existing intangible
>     assets and its current accounting policy for such items, the impact of adopting
>     SFAS 142 is not expected to result in a significant impact on the Company.

---

**Item 2. Management's
  Discussion and Analysis of Financial Condition and Results of Operations**

When used
  herein, the words may, will, expect, anticipate,
  continue, estimate, project, intend,
  plan and similar expressions are intended to identify forward-looking
  statements within the meaning of Section 21E of the Securities Exchange Act
  of 1934, as amended, regarding events, conditions and financial trends that
  may affect the Company's future plans of operations, business strategy, operating
  results and financial position. All statements, other than statements of historical
  facts, included or incorporated by reference in this Form 10-QSB which address
  activities, events or developments which the Company expects or anticipates
  will or may occur in the future, including such things as future capital expenditures
  (including the amount and nature thereof), business strategy, expansion and
  growth of the Companys business and operations, and other such matters
  are forward-looking statements. These statements are based on certain assumptions
  and analyses made by the Company in light of its experience and its perception
  of historical trends, current conditions and expected future developments as
  well as other factors it believes are appropriate in the circumstances. Such
  statements are not guarantees of future performance and are subject to risks
  and significant uncertainties and that actual results may differ materially
  from those included within the forward-looking statements as a result of various
  factors. The occurrence of any unanticipated events may cause actual results
  to differ from those expressed or implied by the forward-looking statements
  contained herein. You are cautioned not to place undue reliance on these statements,
  which speak only as of the date of this report.

Overview

Aucxis Corp.
  (Aucxis or the Company) was originally incorporated
  in Nevada on January 8, 1998 under the name Kazari International, Inc. (Kazari).
  On February 26, 1999, Kazari and e-Auction Global Trading Inc. (Barbados) entered
  into a share exchange agreement pursuant to which agreement Kazari purchased
  e-Auction (Barbados) shares on a one for one basis. Kazari had no viable business
  activities at the time of the share exchange agreement. On June 10, 1999, Kazari
  amended its name to e-Auct ion Global Trading Inc. During fiscal year 2000,
  Aucxis acquired Schelfhout Computer Systemen N.V., Kwatrobox B.V., and I-Three,
  Inc. On June 12, 2001 the Company amended its charter to change its name to
  Aucxis Corp.

Aucxis currently
  has a wholly owned subsidiary, e-Auction (Barbados), which in turn has one wholly
  owned subsidiary, Aucxis Corp. (Canada). The Company also owns Aucxis NV (Belgium),
  directly, which in turn owns 92.5% of Aucxis Trading Solutions NV (ATS)
  (formerly Schelfhout Computer Systemen N.V.(Schelfhout)), a Belgium company.
  ATS has a 40% ownership interest in SDL Invest N.V. and a 33.3% interest in
  ATS Holland B.V. Aucxis also has a 48.2% investment in Aucxis Limited. (Australia)
  (formerly Hunter Capital Limited), that was written off in the prior year. Previously,
  Aucxis Limited was accounted for by the equity method.

The Company
  also owns V-Wholesaler B.V. and its wholly owned subsidiary, Kwatrobox B.V.
  and the subsidiaries of Kwatrobox B.V., 100% of Aucxis Business Solutions (ABS)
  (formerly Automatiserngbureau Palm B.V.), 80% of Scoop Software B.V., 100% of
  Palm Veilingsystemen B.V., 100% of Nieaf Systems B.V. (Nieaf). Leading
  up to September 2001, management at ABS was unable to generate positive cash
  flow and continued to seek financial support from Aucxis Corp. Previous management
  had funded this subsidiary in an effort to support management efforts in excess
  of USD$2,000,000. After reviewing the subsidiaries, the new board of directors
  determined that ABS management had not shown an ability to generate profit and
  that it would not be in the interest of Aucxis Corps shareholders to continue
  funding Kwatrobox or any of its subsidiaries. As a result, Kwatrobox B.V. and
  its operating subsidiaries, ABS and Nieaf, filed for voluntary bankruptcy.
  Under the bankruptcy laws of the Netherlands, a trustee took control of Kwatrobox
  and its aforementioned bankrupt subsidiaries in October 2001. Due to the loss
  of control Aucxis Corp. has written off the assets and liabilities in its consolidated
  financial statements for the year ended December 31, 2001.

ATS (formerly
  Schelfhout) is a solutions provider for perishable commodity (fish, flower,
  fruits and vegetables) auction houses. Over the past 19 years ATS has developed
  t rading systems for numerous selling organizations all over the world. Through
  ATS, the Company has the potential to access electronic trading hubs representing
  billions of dollars in annual turnover, including European trade of more than
  USD$7 billion. ATS delivers the tools to bring together supply and demand under
  optimum conditions and thus create a better market situation. ATS has focused
  on two market sectors: (i) the computerization of auctions and (ii) automation
  for the preservation of perishable products. As an ancillary to the auction
  system, a modular graphic display panel was developed by ATS in 1992 and added
  to the product range.

---



Through its
  subsidiary ATS, Aucxis is engaged in the installation and maintenance of auction
  clock and cooling systems for traditional auction halls and the development
  of software for auctions, including Internet-based auction systems. The development
  of e-business services for perishable commodity marketplaces has been temporarily
  suspended pending further review of the business opportunities in this area.
  Aucxis continues to maintain a staging environment for testing and
  further research and development.

Highlights
  of the Quarter

Revenue for
  the six months ended June 30, 2002 was $2,610,700 compared to $3,587,000 in
  the same period in 2001. Gross margin was consistent for both periods at approximately
  50%. Revenue for the three months ended June 30, 2002 was $1,302,000 compared
  to 1,621,000 for the three months ended June 30, 2001.

Although
  overall revenue has decreased, revenue from ATS for the six months ended June
  30, 2002 has actually increased by $873,000 from the same six month period in
  2001. The decrease in overall revenue is a direct result of managements
  decision to discontinue its financial support for the loss making Palm Automatisering
  (Aucxis Business Solutions ABS) and Nieaf companies. ABS had continued
  to consume shareholder funds within a business that no longer forms part of
  Aucxis refocused business strategy. Aucxis was unable to extract Nieaf
  from the Kwatrobox failure in spite of the fact that it did fit with the overall
  strategy. The assets of Nieaf were purchased from the receiver in partnership
  with the two largest flower auctions in the Netherlands. This is now operating
  as Auction Trading Systems Holland B.V. -ATS Holland B.V. currently has arrangements
  with the current employer of the previous Nieaf employees to provide contractual
  services in support of installations. ATS Holland is ramping up staff in line
  with revenues to ensure continued ongoing maintenance of existing installations.

Revenue for
  the quarter was driven entirely by ATS with continued growth in the installation
  of auction clock systems and cooling systems. ATS continues to derive its revenues
  from the development and installation of clock systems, cooling installations
  and associated maintenance contracts for auctions. During the six months ending
  June, 2002, ATS has positioned itself to exceed its revenue targets for the
  year by securing approximately $4,000,000 in signed contracts.

Selling,
  general and administrative expense for the six months ended June 30 2002 was
  $1,609,000 as compared to $4,205,000 for the corresponding six-month period
  in 2001. Selling, general and administrative expense for the three months ended
  June 30 2002 was $820,500 as compared to $1,686,500 for the corresponding three-month
  period in 2001

The decrease
  of over 60% in selling, general and administrative expense for the six months
  ended June 30, is directly attribut ed to the Companys cost management
  initiatives including the elimination of the expenses of Palm and Nieaf from
  the consolidated financial statements due to their bankruptcy last year. As
  I-Three is essentially inactive, virtually no expenses were incurred in this
  subsidiary. There has been no change in the number of employees as at June 30,
  2002 in Belgium. Aucxis head office staff consist of two contract executives
  and one contract advisor to the Company. As part of the Companys cost
  management init iatives all accounting and administration functions are provided
  on an as needed basis by a company controlled by the CFO, thus eliminating
  the need for permanent staff.

Depreciation
  and amortization expense for the six months ended June 30, 2002 was down over
  90% from the same six-month period last year. Similarily depreciation and amortization
  expense for the three months ended June 30, 2002 was also down over 90% from
  the same period last year. This decrease is the result of write-offs in the
  prior year of goodwill, acquired workforce and acquired core technology. All
  goodwill, acquired workforce and acquired core technology was written off for
  I-three. Goodwill related to the Kwatrobox acquisition was written off as a
  result of the voluntary bankruptcy of Kwatrobox and its subsidiaries, declared
  on September 19, 2001 by Nieaf, September 26, 2001 by Aucxis Business Solutions
  and October 3, 2001 by Kwatrobox. In addition, the net carrying value of goodwill
  related to the acquisition of ATS was written down as the Company no longer
  considered the carrying amount of this goodwill to represent the amount by which
  the fair value of ATS exceeds the fair value of the its net identifiable assets.

---

During this
  quarter the only remaining items subject to depreciation were the ATS acquired
  core technology and the capital assets of the Company.

Research
  and development costs were nil for the six months ended June 30, 2002 as compared
  to $974,000 in the six months ended June 30, 2001 due in part to the temporary
  suspension of development of the Collateral Management Utility, but mostly due
  to the elimination of the operations of Kwatrobox and some of its subsidiaries
  due to their bankruptcy last year.

The loss
  for the six months ended June 30, 2002 was $547,200 compared to $5,323,000 for
  the same period in 2001. Similarily the loss for the three months ended June
  30, 2002 was $254,700 compared to $2,887,000for the three months ended June
  30, 2002. This significant improvement is attributed to the Companys ongoing
  cost management initiatives. The results for the six months ended June 30, 2002
  include $115,800 in write-downs including a one time write off of approximately
  $25,000 due to the disposition of a Mercedes Benz utilized by the previous managing
  director of ATS, Luc Schelfhout.

Management
  is continuing its revenue enhancing and cost management initiatives while simultaneously
  exploring various strategic options for the Company including business combinations
  and joint ventures with other companies in the perishable goods marketplace.
  Discussions with Agro Marches Internationaux have ceased as it was felt that
  it would not to be in the best interest of the shareholders to merge the two
  organizations at this time. The concentration of continued development of ATS
  is justified by the continuing capture of new business and the further consolidation
  of ATS leadership as the premier supplier of electronic trading systems
  to perishable agriculture and fish trading world- wide. During the six months
  ended June 30, 2002, ATS has been successful in securing significant trading
  system and maintenance contracts.

Liquidity
  and Capital Resources

As at June
  30, 2002, the Company had a cash balance of $305,686, a net change of less than
  $5,000 from the cash balance on December 31, 2001. In June of 2002, the Company
  was successful in raising $375,000 in the form of a convertible loan for working
  capital purposes. Cash from this loan and from ATS operations including bank
  lines of credit were used primarily to fund inventory and work in progress (an
  increase of approximately $1,600,000 from December 31, 2001) and for general
  working capital purposes. The projected cash flows for the Company are based
  upon assumptions that include, amongst others, increased growth within ATS and
  the success of future external financing initiatives. Management continues to
  examine a variety of options to raise additional financing. The restraint order
  applied by Mr. Luc Schelfhout and Mrs. Hilde De Laet to a portion of the ATS
  shares held by Aucxis NV continues to make it difficult for the Parent company
  to raise capital as well as restricts Aucxis Corp. from realizing the payment
  from ATS of any after tax dividends. This has resulted in low cash levels at
  Aucxis Corp. and reasonable cash levels at its subsidiary, ATS. At the ATS level
  management has been successful securing the necessary credit lines and bank
  guarantees needed to fulfil the requirements under the various contracts that
  have been secured. Aucxis is continuing its revenue enhancement and cost management
  initiatives, including decreasing operating costs and working with creditors
  regarding outstanding payables. It is not possible at this time to predict with
  any assurance the success of any other initiatives, however management is working
  diligently towards the goal of self-sustainability.

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PART II -
  OTHER INFORMATION

Item 1. Legal
  Proceedings

On March
  29, 2002 Mr. Schelfhout and Mrs. De Laet brought an ex parte application before
  Court of Dendermonde (Belgium), which granted them authorization to apply a
  restraint order to a portion of the ATS shares held by Aucxis NV (Belgium).
  The restraint order was effectively applied on that same date with a view to
  securing the alleged damages that may be due in respect of the arbitration proceedings.
  On April 29, 2002 Aucxis NV (Belgium) appealed the said authorization and restraint
  order, which it also believes to be without merit, before the Court of Dendermonde
  (Belgium). The judge for Attachments of Dendermonde has heard the case on June
  25, 2002 and will reach a decision on or about September 24, 2002.

On April
  16, 2002, Mr. Schelfhout and Mrs. De Laet filed a request for arbitration against
  Aucxis NV (Belgium) and the Company. The plaintiffs allege that the Company
  and Aucxis NV (Belgium) deliberately committed a number of misrepresentations
  both prior to and subsequent to the closing of the ATS share purchase agreement.
  They have alleged damages of up to USD 1,190,309 for which they seek to be compensated
  by Aucxis NV (Belgium) and the Company. These proceedings are presently in their
  initial stages and are not expected to be resolved before the end of the fiscal
  year. Management believes that the claim brought against Aucxis NV (Belgium)
  and itself is without merit and intends to vigorously defend both itself and
  Aucxis NV (Belgium).

On March
  26, 2002, Mr. Schelfhout resigned as the managing director of ATS, as a consequence
  of which ATS brought a civil law action before the Commercial Court of Dendermonde
  (Belgium) on May 17, 2002, aiming at establishing that such resignation has
  caused the management contract under which Mr Schelfhout performed his management
  duties to be terminated, entitling ATS to cease all payments of management fees
  and to demand damages. Written pleadings have been submitted by the Company
  and by Luc and Hilde Schelfout and the case is expected to be heard on or about
  September 20, 2002.

On May 14,
  2002 Aucxis NV (Belgium) brought an action against Mr. Schelfhout and Mrs. De
  Laet before the Court of Dendermonde (Belgium) relating to certain irregularities
  in the deletion of a non-compete clause from ATS articles of association.
  After all written pleadings have been submitted, the Commercial Court of Dendermonde
  will hear the case on or about November 12, 2002.

Except as
  described above, management does not have knowledge of any material litigation
  pending, threatened or contemplated, or unsatisfied judgments against the Company
  or its affiliates, or any proceedings in which the Company or its affiliates
  is a party. Similarly, management is without knowledge as to any legal actions
  pending or threatened or judgments entered against the Company's executive officers
  and directors in their capacity as such, other than to the extent such individuals
  are named in the above actions.

Item 5. Other
  Information

In June 2002,
  the Company obtained $375,000 in new funding by the completion of a convertible
  loan transaction with three lenders. The convertible loan essentially provides
  a bridge facility for working capital purposes, both at the head office level
  and at the level of the Belgian subsidiaries Aucxis NV and ATS. The convertible
  loan bears interest at a rate of 12.5% p.a. Both principal and interest are
  due to be repaid in a lump sum on December 31, 2002. The principal and interest
  outstanding are convertible into common shares of the Company at a conversion
  rate of $0.01 per share at the option of the lenders anytime prior to repayment.
  The Company may repay the convertible loan at anytime without penalty subject
  to the right of the lenders to convert the loan into common shares prior to
  repayment. Initially all of the loan proceeds were placed in escrow with an
  escrow agent, subject to being drawn down by the Company when funds are required.
  Funds not drawn down are subject to interest payment but are not entitled to
  be converted into shares. As security for the repayment of the convertible loan,
  Aucxis NV (Belgium), has pledged its interest in the shares of ATS to the three
  lenders, be it on a without prejudice basis regarding the rights which Mr Schelfhout
  and Mrs De Laet could derive from the pledge granted to them on execution of
  the ATS purchase agreement and from the restraint orders applied by them to
  the ATS shares held by Aucxis NV (Belgium) on July 17, 2001 and March 29, 2002.
  Aucxis is pursuing additional funding and until such funding is received, there
  is no certainty that the Company will be able to fulfill its obligation under
  the convertible loan.

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On June 27, 2002, Bart Sonck
  resigned as a director of the Company.

Item 6. Exhibits And Reports
  On Form 8-K

|(a) | Exhibits.                                                                                      | 
|--- | ---------------------------------------------------------------------------------------------- | 
|    |                                                                                                | 
|    | The Company
      has no exhibits to file.                                                     | 
|    |                                                                                                | 
|(b) | Reports on
      Form 8-K                                                                      | 
|    |                                                                                                | 
|    | The Company did not file
      any reports on Form 8-K during the quarter ended June 30, 2002. | 
|    |                                                                                               

**SIGNATURES**

In accordance
  with the requirements of the Securities Exchange Act of 1934, as amended, the
  Company has caused this report to be signed on its behalf by the undersigned
  thereunto duly authorized.

|Date: | September
      16 2002 | Aucxis
      Corp.
|----- | ----------------------- | ------------------
|      |                         | (Registrant)      
|      |                         |                   
|      |                         |                   
|      |                         | By:               
|      |                         |                   
|      |                         |                   

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