<PAGE>
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549


                                   FORM 10-QSB

        [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
                              EXCHANGE ACT OF 1934

                FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2002

       [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE EXCHANGE ACT

                FOR THE TRANSITION PERIOD FROM ______ TO ______

                        COMMISSION FILE NUMBER 000-29211

                   DAC TECHNOLOGIES GROUP INTERNATIONAL, INC.
                 (NAME OF SMALL BUSINESS ISSUER IN ITS CHARTER)


         FLORIDA                                         65-0847852
-------------------------------                       ------------------
(STATE OR OTHER JURISDICTION OF                       (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION)                        IDENTIFICATION NO.)

 1601 WESTPARK DRIVE #4C LITTLE ROCK, AR                       72204
----------------------------------------                     ----------
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)                     (ZIP CODE)

                                 (501) 661-9100
                           (ISSUER'S TELEPHONE NUMBER)

         CHECK WHETHER THE ISSUER (1) HAS FILED ALL REPORTS REQUIRED TO BE FILED
BY THE 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.

        (1) YES [X] NO [ ]                    (2) YES [X] NO [ ]

         STATE THE NUMBER OF SHARES OUTSTANDING OF EACH OF THE ISSUER'S CLASS OF
COMMON EQUITY, AS OF THE LATEST PRACTICABLE DATE. AS OF NOVEMBER 8, 2002,
5,817,956 SHARES OF COMMON STOCK ARE ISSUED AND OUTSTANDING.

          TRANSITIONAL SMALL BUSINESS DISCLOSURE FORMAT: YES [ ] NO [X]



<PAGE>



                                TABLE OF CONTENTS


PART I.....................................................................3

ITEM 1.  FINANCIAL STATEMENTS..............................................3

PART F/S...................................................................3

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF PLAN OF OPERATION
                  Background..............................................10
                  Financial Condition and Results of Operations...........12
                  Liquidity and Capital Resources.........................13
                  Trends..................................................14

PART II ..................................................................14

ITEM 1.  LEGAL PROCEEDINGS ...............................................14

ITEM 2.  CHANGES IN SECURITIES ...........................................15

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES .................................15

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS .............15

ITEM 5.  OTHER INFORMATION ...............................................15

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K ................................15

SIGNATURES ...............................................................16



                                       2
<PAGE>





PART I


ITEM 1.  FINANCIAL STATEMENTS



                   DAC TECHNOLOGIES GROUP INTERNATIONAL, INC.

                          BALANCE SHEET (CONSOLIDATED)
                               September 30, 2002
                                    Unaudited


                               ASSETS

Current assets
       Cash                                           $    21,659
       Accounts receivable                                642,747
       Inventories                                        553,460
       Advances to related parties                        108,046
       Prepaid expenses                                   111,644
       Current deferred income tax benefit                 15,150
                                                      -----------
Total current assets                                    1,452,706
                                                      -----------

Property and equipment
       Furniture and fixtures                             121,677
       Molds, dies, and artwork                           451,864
                                                      -----------
                                                          573,541
       Accumulated depreciation                          (310,104)
                                                      -----------
Net property and equipment                                263,437
                                                      -----------

Other assets
       Patents and trademarks, net of
       accumulated amortization of $27,160                124,088
       Notes receivable                                    41,713
       Deferred income tax benefit                        233,450
                                                      -----------
Total other assets                                        399,251
                                                      -----------

Total assets                                          $ 2,115,394
                                                      ===========





                                       3




<PAGE>
                   DAC TECHNOLOGIES GROUP INTERNATIONAL, INC.

                          BALANCE SHEET (CONSOLIDATED)
                               September 30, 2002
                                    Unaudited


         LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities
       Due to factor                                               $   444,594
       Notes payable                                                   424,643
       Notes payable - stockholders                                    200,000
       Accounts payable-trade                                          231,162
       Accrued payroll tax withholdings                                131,462
       Accrued expenses-other                                           18,930
                                                                   -----------
Total current liabilities                                            1,450,791
                                                                   -----------


Stockholders' equity
       Common stock, $.001 par value; authorized
         50,000,000 shares; issued and outstanding
         5,817,956 shares                                                5,818
       Preferred stock, $.001 par value; authorized
         10,000,000 shares; none issued and outstanding
       Additional paid-in capital                                    1,236,216
       Retained earnings (deficit)                                    (577,431)
                                                                   -----------
Total stockholders' equity                                             664,603
                                                                   -----------

Total liabilities and stockholders' equity                         $ 2,115,394
                                                                   ===========




                                       4


<PAGE>

                   DAC TECHNOLOGIES GROUP INTERNATIONAL, INC.

                     STATEMENTS OF OPERATIONS (CONSOLIDATED)
              For the Nine Months Ended September 30, 2002 and 2001
                                    Unaudited

<TABLE>
<CAPTION>

                                                                   Sept. 30          Sept. 30
                                                                     2002              2001
                                                                 -----------       -----------
<S>                                                              <C>               <C>
Net sales                                                        $ 1,739,530       $ 1,536,521

Cost of sales                                                        921,803           737,449
                                                                 -----------       -----------

Gross profit                                                         817,727           799,072
                                                                 -----------       -----------

Operating expenses
       Selling                                                       297,238           387,758
       General and administrative                                    502,395           532,348
                                                                 -----------       -----------
Total operating expenses                                             799,633           920,106
                                                                 -----------       -----------

Income from operations                                                18,094          (121,034)
                                                                 -----------       -----------

Other income (expense)
       Other income                                                   46,713                --
       Interest expense                                              (75,758)          (64,663)
                                                                 -----------       -----------
         Total other income (expense)                                (29,045)          (64,663)
                                                                 -----------       -----------

Income (loss) before income tax expense                              (10,951)         (185,697)

Provision for income taxes                                                --                --
                                                                 -----------       -----------

Net income (loss)                                                $   (10,951)      $  (185,697)
                                                                 ===========       ===========


Numerator - net income (loss)                                    $   (10,951)      $  (185,697)

Denominator - weighted average number of shares outstanding        5,769,864         5,323,844
                                                                 -----------       -----------

Basic earnings (loss) per share                                  $     (0.00)      $     (0.03)
                                                                 ===========       ===========

</TABLE>



                                       5
<PAGE>
                   DAC TECHNOLOGIES GROUP INTERNATIONAL, INC.

                     STATEMENTS OF CASH FLOWS (CONSOLIDATED)
              For the Nine Months Ended September 30, 2002 and 2001
                                    Unaudited


<TABLE>
<CAPTION>

                                                                 Sept. 30        Sept. 30
                                                                   2002            2001
                                                                ---------       ---------
<S>                                                             <C>             <C>
Cash flows from operating activities
       Net income (loss)                                        $ (10,951)      $(185,697)
       Adjustments to reconcile net income to
         net cash provided (used in) operating activities:
             Issuance of common stock for services                 32,866          76,460
             Depreciation                                          46,405          42,750
             Amortization                                           8,223           2,250
             Changes in assets and liabilities
                   Accounts receivable                           (231,090)       (166,430)
                   Inventories                                   (138,344)       (189,166)
                   Advances to employees                           (4,642)        (44,598)
                   Prepaid expenses                               (32,438)        (86,970)
                   Other assets                                   (41,713)       (106,450)
                   Accounts payable - trade                       150,207          73,322
                   Accrued payroll tax withholdings               (37,025)         39,884
                   Accrued expenses other                         (31,096)         (4,329)
                                                                ---------       ---------
Net cash provided by (used in) operating activities              (278,647)       (363,277)
                                                                ---------       ---------

Cash flows from investing activities
       Purchases of property and equipment                        (17,423)        (32,034)
       Proceeds from sale of property & equipment                      --          19,750
       Purchases of patents and trademarks                         (2,750)        (26,189)
                                                                ---------       ---------
Net cash provided by (used) in investing activities               (20,173)        (38,473)
                                                                ---------       ---------

Cash flows from financing activities
       Increase (decrease) in due to factor                       167,482         106,218
       Payments on long-term debt                                    0.00         (24,966)
       Net change in notes payable                                (48,685)        471,369
       Net change in notes payable-related party                   75,000              --
       Proceeds from issuance of common stock                      40,000          46,463
       Payments on stock subscriptions receivable                  25,000              --
                                                                ---------       ---------
Net cash provided by (used in) financing activities               258,797         599,084
                                                                ---------       ---------


Increase (decrease) in cash                                       (50,974)         11,637

Cash - beginning of period                                         72,633          26,433
                                                                ---------       ---------
Cash - end of period                                            $  21,659       $  38,070
                                                                =========       =========

</TABLE>



                                       6

<PAGE>
                   DAC TECHNOLOGIES GROUP INTERNATIONAL, INC.

                     STATEMENTS OF OPERATIONS (CONSOLIDATED)
             For the Three Months Ended September 30, 2002 and 2001
                                    Unaudited

<TABLE>
<CAPTION>

                                                                   Sept. 30,        Sept. 30,
                                                                     2002             2001
                                                                 -----------       -----------
<S>                                                              <C>               <C>
Net sales                                                        $   621,670       $   557,073

Cost of sales                                                        353,129           289,150
                                                                 -----------       -----------

Gross profit                                                         268,541           267,923
                                                                 -----------       -----------

Operating expenses
       Selling                                                        83,204           202,317
       General and administrative                                    173,923           166,921
                                                                 -----------       -----------
Total operating expenses                                             257,127           369,238
                                                                 -----------       -----------

Income from operations                                                11,414          (101,315)
                                                                 -----------       -----------

Other income (expense)
       Other income                                                   46,713                --
       Interest expense                                              (35,185)          (25,866)
                                                                 -----------       -----------
         Total other income (expense)                                 11,528           (25,866)
                                                                 -----------       -----------

Income (loss) before income tax expense                               22,942          (127,181)

Provision for income taxes                                                --                --
                                                                 -----------       -----------

Net income (loss)                                                $    22,942       $  (127,181)
                                                                 ===========       ===========


Numerator - net income (loss)                                    $    22,942       $  (127,181)

Denominator - weighted average number of shares outstanding        5,797,304         5,355,104
                                                                 -----------       -----------

Basic earnings (loss) per share                                  $      0.00       $     (0.02)
                                                                 ===========       ===========

</TABLE>



                                       7
<PAGE>
                   DAC TECHNOLOGIES GROUP INTERNATIONAL, INC.

                     STATEMENTS OF CASH FLOWS (CONSOLIDATED)
             For the Three Months Ended September 30, 2002 and 2001
                                    Unaudited
<TABLE>
<CAPTION>


                                                                Sept. 30,      Sept. 30,
                                                                  2002           2001
                                                                --------       --------
<S>                                                               <C>          <C>
Cash flows from operating activities
       Net income (loss)                                          22,942       (127,181)
       Adjustments to reconcile net income to
         net cash provided (used in) operating activities:
             Issuance of common stock for services                32,866          7,955
             Depreciation                                         16,000         14,250
             Amortization                                          2,800            750
             Changes in assets and liabilities
                   Accounts receivable                           (64,702)       (86,910)
                   Inventories                                   (79,703)       (98,336)
                   Advances to employees                            (850)        (3,182)
                   Prepaid expenses                              (16,155)       (20,926)
                   Other assets                                  (41,713)         2,353
                   Accounts payable - trade                       50,257         19,682
                   Accrued payroll tax withholdings              (15,583)       (15,789)
                   Accrued expenses other                          2,673            470
                                                                --------       --------
Net cash provided by (used in) operating activities             (114,110)      (179,683)
                                                                --------       --------

Cash flows from investing activities
       Purchases of property and equipment                        (1,279)        (5,986)
                                                                --------       --------
Net cash provided by (used) in investing activities               (1,279)        (5,986)
                                                                --------       --------

Cash flows from financing activities
       Increase (decrease) in due to factor                      124,287        143,537
       Net change in notes payable                               (20,842)       148,429
       Proceeds from issuance of common stock                         --         46,463
                                                                --------       --------
Net cash provided by (used in) financing activities              103,445        338,429
                                                                --------       --------

Increase (decrease) in cash                                       10,998         25,579

Cash - beginning of period                                        10,661         12,491
                                                                --------       --------

Cash - end of period                                              21,659         38,070
                                                                ========       ========

</TABLE>

                                       8


<PAGE>





                   DAC TECHNOLOGIES GROUP INTERNATIONAL, INC.
                     SELECTED NOTES TO FINANCIAL STATEMENTS

o        NATURE OF BUSINESS

         DAC Technologies Group International, Inc. (the "Company"), a Florida
corporation, is in the business of developing, manufacturing and marketing
various consumer products, patented and unpatented, which are designed to
provide security for the consumer and their property. In addition, the Company
has developed a wide range of security and non-security products for the home,
automobile and individual. The majority of the Company's products are
manufactured and imported from mainland China and are shipped to the Company's
central warehouse facility in Little Rock, Arkansas, and fulfillment houses on
the East coast and West coast. These products, along with other items
manufactured in the United States, are sold primarily to mass merchants and
sporting goods retailers throughout the United States and international
locations.

o        ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         Organization and basis of presentation - The Company was incorporated
as a Florida corporation in July 1998 under the name DAC Technologies of
America, Inc. In July 1999, the Company changed its name to DAC Technologies
Group International, Inc.

         Unaudited interim financial statements - The accompanying financial
statements of the Company for the nine months ended September 30, 2002 and 2001
and for the three months ended September 30, 2002 and 2001 are unaudited, but,
in the opinion of management, reflect the adjustments, all of which are of a
normal recurring nature, necessary for a fair presentation of such financial
statements in accordance with generally accepted accounting principles. The
significant accounting policies applied to these interim financial statements
are consistent with those applied to the Company's December 31, 2001 audited
financial statements included in the Company's Form 10KSB. The results of
operations for an interim period are not necessarily indicative of the results
for a full year.

o        EQUITY TRANSACTIONS

         During the fourth quarter of the year ended December 31, 2001, the
Company initiated a private placement offering of the Company's common stock.
During the first quarter of 2002, the Company issued 40,000 shares of restricted
common stock at $1.00 per share. This offering expired on March 31, 2002.

         During the third quarter of 2002, the Company issued 4,000 shares of
restricted common stock to four employees in various amounts in reliance upon
Section 4(2) of the Securities Act for past services.




                                       9
<PAGE>


         During the third quarter of 2002, the Company issued 50,000 shares of
restricted common stock to a related party who is also a creditor of the Company
pursuant to the terms of a consulting agreement. The payment of 25,000 of these
shares may be deemed additional compensation for this party's loan to the
Company.(1)

o        NOTES PAYABLE

         On March 12, 2002, the Company extended a line of credit with a local
bank in the principal amount of $149,500. Proceeds of this line of credit was
used to finance the start up costs associated with the Company's wholly-owned
subsidiary, Summit Training International, Inc. The principal balance of this
loan is now due October 12, 2002 and bears interest at 7.75%. This Note is now
past due, however, the Bank has indicated to the Company that it does not intend
to call the loan. The Company is currently in negotiations for renewal of this
loan.

         On May 1, 2002, the Company extended its $180,000 inventory line of
credit with a local bank. This line of credit matures October 31, 2002, and
bears interest at 7.75%. This Note is now past due, however, the Bank has
indicated to the Company that it does not intend to call the loan. The Company
is currently in negotiations for renewal of this loan.

         On May 7, 2002, the Company obtained a $100,000 loan from an
individual, which matures December 7, 2002 and bears interest at 6%. The Note
was issued to a related party who is also a consultant to the Company.

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

The following Management Discussion and Analysis of Financial Condition is
qualified by reference to and should be read in conjunction with our Financial
Statements and the Notes thereto as set forth at the end of this document. We
include the following cautionary statement in this Form 10QSB for any
forward-looking statements made by, or on behalf of, the Company.
Forward-looking statements include statements concerning plans, objectives,
goals, strategies, expectations, future events or performances and underlying
assumptions and other statements which are other than statements of historical
facts. Certain statements contained herein are forward-looking statements and,
accordingly, involve risks and uncertainties which could cause actual results or
outcomes to differ materially from those expressed in the forward-looking
statements. The Company's expectations, beliefs and projections are expressed in
good faith and are believed by the Company to have a reasonable basis, including
without limitations, management's examination of historical operating trends,
data contained in the Company's records and other data available from third
parties, but there can be no assurance that management's expectations, beliefs
or projections will result or be achieved or accomplished.

--------

(1) The terms of this party's May 7, 2002, Loan are more fully set forth
in the Notes Payable Note to Financial Statements below.



                                       10

<PAGE>



(A)      SUMMARY

         The Company has continued to be active in the research and development
of new security products for sale to our mass merchant, sporting goods and other
customers. As previously reported, the Company introduced and began shipments of
five new products during the second quarter, including all five items being
placed in Wal Mart's gun accessory module. Four of these items have been
approved for sale in the state of California, and are now being marketed toward
firearm manufacturers and national sporting goods chains.

         During the third quarter, the Company received and shipped orders for
its California approved cable lock to two large gun manufacturers and received
orders from a third that began shipping during the fourth quarter of this year.

         In addition to these items, the Company has completed development of a
new line of windproof/water-resistant butane lighters for the sporting goods
market. The Company has received verbal commitments from a large retailer for
this new item, for shipment in the fourth quarter of 2002, as well as interest
from gun manufacturers under a private label program. We have also begun
redesigning the packaging of our fast access portable safe (SportSafe) for the
automotive industry (Vehicle Vault).

         The Company continues to identify and develop new security products for
the gun and sporting goods markets. Our ability to manufacture quality products
at a low cost has enabled us to have competitive pricing in these markets.

         The introduction of these new items has enabled the Company to increase
its revenues during the third quarter by 12% over last year. This increase in
revenues and the Company's continued efforts to reduce expenses has resulted a
return to profitability in the second and third quarters.

         In July, 2002, the Company sold certain assets of its subsidiary,
Summit Training International, Inc. and Center for Law Enforcement Learning,
Inc., including their names for $50,000, which includes $5,000 in cash and a
$45,000 note, due no later than eighteen (18) months from the date of the Note.
The Company had discontinued operations of these subsidiaries earlier this year
due to unprofitability. The Company has agreed, for a period of four (4) years
from Closing, not to own, manage, participate in (as an employee or otherwise),
advise or otherwise consult with any business that provides instruction or
educational services to law enforcement and/or security agencies, entities or
personnel (collectively "Security Services"), within the United States of
America.


         DETAILS

         We are in the business of developing, marketing and outsourcing the
manufacture of various consumer products, patented and non-patented, designed to
enhance and provide security for the consumer and for his property. We have
placed particular emphasis on gun



                                       11
<PAGE>



safety because it has become a prominent national issue due to the rash of
school and workplace violence over the past few years. In particular, our
products consist of gun locks, trigger locks, security safes, specialty safes,
personal protection devices and items for the health care industry. A
significant portion of our business is with mass market retailers such as Wal
Mart, Walgreens and Kmart. However, initiatives to develop a nationwide cadre of
manufacturer's representatives will allow us to penetrate the entire sporting
goods market, which consists of thousands of smaller gun shops and sporting
goods stores. These initiatives have met with moderate success. We have also
begun selling our products into many other markets consisting of safe retailers,
jewelry stores, truck stops, alarm companies, RV retailers and computer
retailers. Developing these markets and continuing to focus attention on
potential new ones will allow us to reduce our dependence on our mass merchant
customers.

THE COMPANY'S BUSINESS PLAN AND STRATEGY FOR GROWTH FOCUSES ON:

         o  increased penetration of our existing market

         o  aggressive targeting and penetration of other markets, i.e. sporting
            goods retailers

         o  diversification of products and services to provide a base for
            continued growth

         o  adoption of new technologies for safety and security products

         o  adoption of new product lines

         o  identification and recruitment of effective manufacturer's
            representatives to actively market these products on a national and
            international basis

         o  aggressive cost containment

         The principal key to increasing the rate of the Company's growth is the
availability of capital to maintain additional inventory, develop or acquire new
products and secure motivated professional employees.

         Management believes that continued growth will require the Company to
continually innovate and improve its existing line of products and services to
meet consumer, industry and governmental demands. In addition, we must continue
to develop or acquire new and unique products that will appeal to gun owners.
With the passage of legislation in California requiring approval from the
California Department of Justice for a firearm safety device to be sold in that
state, many national gun manufacturers and sporting goods retailers looking into
using only California compliant devices. Recognizing this fact, the Company now
has 10 firearm safety devices (including the portable SportSafe) approved by the
California Department of Justice.

         We have redesigned our website (www.dactec.com). All of our products
are available via e-commerce on this new site.


(B)      FINANCIAL CONDITION AND RESULTS OF OPERATIONS

         The Company had net income of $22,942 on net sales revenues of $621,670



                                      12
<PAGE>



for the three months ended September 30, 2002, as compared to a net loss of
$127,181 on net sales revenues of $557,073 for the three months ended September
30, 2001. This represents an increase in net income of $150,123 over the
preceding year. Revenues increased $64,597 over the preceding year, a 12%
increase.

         Operating expenses for the three months ended September 30, 2002 were
$257,127 as compared to $369,238 for the same period in 2001. This decrease of
$112,111 represents a 30% decrease, and is a result of management's continuing
efforts to reduce expenses.

         Gross margin percentages decreased from 48% for the three months ended
September 30, 2001 to 43% for the three months ended September 30, 2002. This
decrease is mainly due to competition in the safe business and an increase in
sales of gun locks to gun manufacturers. Sales of the Company's line of security
safes increased from $102,753 for the three months ended September 30, 2001 to
$160,832 for the same three month period in 2002. However, gross margins
decreased for 46% to 40%, respectively. Competition in the security safe
industry has increased dramatically over the past year, which has caused the
Company to reduce its margins to increase its market share for these items.

         For the nine months ended September 30, 2002, the Company had a net
loss of $10,951 on net sales revenues of $1,739,530 as compared to a net loss of
$185,697 on net sales revenues of $1,536,521 for the nine months ended September
30, 2001. This represents a decrease in the net loss of $174,746. The increase
in revenues of $203,009 represents an increase of 13% over the previous year.

         Operating expenses for the nine months ended September 30, 2002 were
$799,633 as compared to $920,106 for the same period in 2001. This decrease of
$120,473 represents a 13% decrease over the prior year, and is a result of
management's expense cuts made during the first quarter of 2002.


(C)      LIQUIDITY AND CAPITAL RESOURCES

         Our primary source of cash is funds from our operations. We believe
that external sources of liquidity could be obtained in the form of bank loans,
letters of credit, etc. We maintain an account receivable factoring arrangement
in order to insure an immediate cash flow. The factor may also, at its
discretion, advance funds prior to the collection of our accounts. Advances are
payable to the factor on demand. Should our sales revenues significantly
decline, it could affect our short-term liquidity. For the period ending
September 30, 2002, we owed our factor approximately $444,594.

        In August 2001, the Company began efforts to raise additional capital
through the private placement of the Company's common stock. This offering
expired March 31, 2002. A total of $415,000 in gross proceeds were generated
from this offering.




                                      13

<PAGE>



         On March 12, 2002, the Company extended a line of credit with a local
bank in the principal amount of $149,500. Proceeds of this line of credit was
used to finance the start up costs associated with the Company's wholly-owned
subsidiary, Summit Training International, Inc. The principal balance of this
loan is now due October 12, 2002 and bears interest at 7.75%. This Note is now
past due, however, the Bank has indicated to the Company that it does not intend
to call the loan. The Company is currently in negotiations for renewal of this
loan.

         On May 1, 2002, the Company extended its $180,000 inventory line of
credit with a local bank. This line of credit matures October 31, 2002, and
bears interest at 7.75%. This Note is now past due, however, the Bank has
indicated to the Company that it does not intend to call the loan. The Company
is currently in negotiations for renewal of this loan.


(D)      TRENDS

         Ongoing publicity involving firearms has caused gun safety to become a
prominent issue nationally. Gun violence, especially in schools has prompted the
President, as well as national and state legislators, to debate legislation
requiring gun safety locks on all firearms. Threatened litigation against gun
manufacturers has caused them to seriously consider placing gun safety locks on
the guns they manufacture. We believe sales revenues in this area will grow
significantly.

         The tragic terrorist attack against the United States on September 11,
2001, caused many Americans to become concerned about their personal security.
As a result, many people are purchasing firearms to maintain for home defense
purposes. While they are purchasing handguns, many are also concerned with the
safe storage of the firearm in the home and want to purchase affordable,
effective gun locks or gun safes to increase security. As a result, we have seen
an increase in revenue due to additional purchases of our products.


                                     PART II


ITEM 1.  LEGAL PROCEEDINGS

         We are the Plaintiff in a legal action instituted by us against our
former manufacturer Skit International, Ltd., Uni-Skit Technologies, Inc. and
Uni-Tat International, Inc. The suit, commenced in August 2000, alleges breach
of a manufacturing contract which required the defendants to manufacture certain
of our products within the range of "competitive pricing," a defined term. We
are seeking damages and recission of 165,000 shares of our common stock as part
of the compensation paid to the defendants. The defendants have denied the
allegations and have counterclaimed for an outstanding balance of $182,625, for
recission of the manufacturing agreement and for damage to its business
reputation. We have denied, and believe there is no merit to the counterclaim's
material allegations. We have replaced the defendants as manufacturers of our
products. A trial date has been set by the court in this matter for April 2,
2003.

         In another matter, we instituted suit along with The Collins Family
Trust, in which David Collins, our Chairman and CEO claims a beneficial
interest, and DAC Technologies of America, Inc., our predecessor, against Larry
Legel, our for Certified Public Accountant, Director and the Trustee of The
Collins Family Trust. The suit, commenced in March, 2001 alleges we transferred



                                      14
<PAGE>

180,000 of our shares of common stock for services which the Defendant did not
provide. The suit also alleges that the Defendant breached an agreement not to
sell his shares before certain private investors had recouped their investment.
We are seeking equitable recission, damages, and injunctive relief. A judgment
has been entered in the Company's favor in this suit.

         In a related action, Legal v. DAC Technologies Group International,
Inc., filed in Florida by our former officer and director, Larry Legal and his
wife, alleged the failure by the Company and its officers to permit the sale of
their shares. There is a hearing set in December seeking a dismissal predicated
on the Arkansas decision.


ITEM 2.  CHANGES IN SECURITIES

         During the third quarter of 2002, the Company issued 4,000 shares of
restricted common stock to four employees in various amounts in reliance upon
Section 4(2) of the Securities Act for past services.

         During the third quarter of 2002, the Company issued 50,000 shares of
restricted common stock to a related party who is also a creditor of the Company
pursuant to the terms of a consulting agreement. The payment of 25,000 of these
shares may be deemed additional compensation for this party's loan to the
Company.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

         None.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         None.


ITEM 5.  OTHER INFORMATION

         None.


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8 -K

         The following documents are incorporated by reference from Registrant's
Form 10SB filed with the Securities and Exchange Commission (the "Commission"),
File No. 000-29211, on January 28, 2000:



                                       15
<PAGE>

         EXHIBITS
         --------

          2        Acquisition Agreement
          3(i)     Articles of Incorporation
          3(ii)    By-laws

          EXHIBITS
         --------

          10.5    Asset Purchase Agreement
          10.6    Consulting Agreement
          99.1    Certification of David A. Collins
          99.2    Certification of Robert C. Goodwin


         SIGNATURES

         In accordance with Section 13 or 15(d) of the Exchange Act, the
         registrant caused this report to be signed on its behalf by the
         undersigned, hereunto duly authorized

         DAC Technologies Group International, Inc.

         By: /s/ David A. Collins
         ----------------------------------
         David A. Collins, Chairman and CEO


November 14, 2002


                                       16