UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                   Form 10-KSB

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(Mark one)
[X] Annual Report Under Section 13 or 15(d) of The Securities Exchange
    Act of 1934

    For the fiscal year ended January 31, 2004

[ ] Transition Report Under Section 13 or 15(d) of The Securities Exchange
    Act of 1934

    For the transition period from ______________ to _____________

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                         Commission File Number: 0-30197


                       KIK TECHNOLOGY INTERNATIONAL, INC.
        (Exact name of small business issuer as specified in its charter)

      California                                               91-2021602
(State of incorporation)                                (IRS Employer ID Number)

                  590 Airport Road, Oceanside, California 92054
                    (Address of principal executive offices)

                                 (760) 967-2777
                           (Issuer's telephone number)

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      Securities registered under Section 12(b) of the Exchange Act: None

         Securities registered under Section 12(g) of the Exchange Act:
                          Common Stock $.001 par value

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Check  whether  the issuer  has (1) filed all  reports  required  to be files by
Section 13 or 15(d) of the  Exchange  Act during the past 12 months (or for such
shorter period the Company was required to file such reports),  and (2) has been
subject to such filing requirements for the past 90 days.  Yes [X]  No [ ]

Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure  will be contained,  to
the best of Company's knowledge,  in definitive proxy or information  statements
incorporated  by reference  in Part III of this Form 10-KSB or any  amendment to
this Form 10-KSB. [ ]

The issuer's revenues for the fiscal year ended January 31, 2004 was $3,639,289.

The aggregate market value of the voting common equity held by non-affiliates as
of April 20,  2004 was  approximately  $272,587  based  upon  25,021,865  shares
outstanding of which 7,571,865 are held by  non-affiliates  and a share price of
$0.036. No non-voting common equity is outstanding.

As of April 20, 2004,  there were  25,021,865  shares of Common Stock issued and
outstanding.

Transitional Small Business Disclosure Format: Yes [ ]  No [X]
<PAGE>
                       KIK TECHNOLOGY INTERNATIONAL, INC.

                                INDEX TO CONTENTS

                                                                     Page Number
                                                                     -----------
PART I

Item 1   Description of Business                                            3
Item 2   Description of Property                                            6
Item 3   Legal Proceedings                                                  7
Item 4   Submission of Matters to a Vote of Security Holders                7

PART II

Item 5   Market for Company's Equity and Related Stockholder Matters        7
Item 6   Management's Discussion and Analysis or Plan of Operation          9
Item 7   Financial Statements                                              12
Item 8   Changes in and Disagreements with Accountants
         on Accounting and Financial Disclosures                           12
Item 8A  Controls and Procedures                                           12

PART III

Item 9   Directors, Executive Officers, Promoters and Control Persons;
         Compliance with Section 16(a) of the Exchange Act                 13
Item 10  Executive Compensation                                            13
Item 11  Security Ownership of Certain Beneficial Owners and Management
         and Related Stockholder Matters                                   14
Item 12  Certain Relationships and Related Transactions                    15
Item 13  Exhibits and Reports on 8-K                                       15
Item 14  Principal Accountant Fees and Services                            15

SIGNATURES                                                                 17

                                       2
<PAGE>
                  CAUTION REGARDING FORWARD-LOOKING INFORMATION

Certain  statements  contained  in  this  annual  filing,   including,   without
limitation, statements containing the words "believes", "anticipates", "expects"
and  words  of  similar  import,  constitute  forward-looking  statements.  Such
forward-looking  statements  involve known and unknown risks,  uncertainties and
other factors that may cause the actual results,  performance or achievements of
the Company,  or industry  results,  to be materially  different from any future
results,   performance   or   achievements   expressed   or   implied   by  such
forward-looking statements.

Such factors include, among others, the following:  international,  national and
local general economic and market conditions:  demographic  changes; the ability
of the Company to sustain,  manage or  forecast  its growth;  the ability of the
Company to successfully make and integrate acquisitions;  raw material costs and
availability;  new product  development and  introduction;  existing  government
regulations  and  changes  in,  or  the  failure  to  comply  with,   government
regulations;  adverse publicity;  competition; the loss of significant customers
or suppliers;  fluctuations  and  difficulty in forecasting  operating  results;
changes in business strategy or development  plans;  business  disruptions;  the
ability  to attract  and  retain  qualified  personnel;  the  ability to protect
technology; and other factors referenced in this and previous filings.

Given  these  uncertainties,  readers  of this Form  10-KSB  and  investors  are
cautioned not to place undue reliance on such  forward-looking  statements.  The
Company  disclaims  any  obligation  to update any such  factors or to  publicly
announce the result of any  revisions to any of the  forward-looking  statements
contained herein to reflect future events or developments.

                                     PART I

ITEM 1 - DESCRIPTION OF BUSINESS

BUSINESS DEVELOPMENT

On  September 4, 2001,  KIK  Technology  International,  Inc.  (KTII)  (formerly
Russian-Imports.com) issued 16,700,000 shares of restricted, unregistered common
stock to KIK Tire  Technologies  Inc. (a  publicly-owned  Canadian  corporation)
(KTTI) for 100.0% of the issued and outstanding stock of KIK Technology, Inc. (a
wholly-owned subsidiary of KTTI). By virtue of this transaction, KIK Technology,
Inc.  became a  wholly-owned  subsidiary of KTII and KTTI became an  approximate
73.6% shareholder in KTII. Concurrent with this transaction, Russian-Imports.com
changed it's corporate name to KIK Technologies International, Inc.

At the transaction date, KTII was a "shell company" as the Company had no assets
or liabilities, had generated no revenues since inception and had incurred total
expenses  of  approximately  $940,000  since its  inception  on February 1, 2000
through the September 4, 2001 transaction.

The  acquisition of KIK  Technology,  Inc.  (KTI), on September 4, 2001, by KTII
effected  a change  in  control  of KTII  and was  accounted  for as a  "reverse
acquisition"  whereby KTI is the  accounting  acquiror for  financial  statement
purposes. For accounting purposes, the acquisition was treated as an acquisition
of the  Company  by  KIK  and  as a  recapitalization  of  KIK.  The  historical
shareholders'  equity  of  KIK,  prior  to the  transaction,  was  retroactively
restated for the equivalent  number of shares exchanged in the transaction after
giving effect to any difference in the par value of the Company and KIK's common
stock, with an offset to additional paid-in capital.

Accordingly, the historical consolidated financial statements of the Company are
those of KTI from it's inception and those of the consolidated entity subsequent
to the September 4, 2001 transaction date.

The  Company  follows  the  accrual  basis  of  accounting  in  accordance  with
accounting principles generally accepted in the United States of America and has
adopted a year-end of January 31.

The Company operates through it's wholly-owned subsidiary, KIK Technology,  Inc.
(KTI). KTI operates from its  manufacturing  plant and marketing offices located
at  Oceanside,  California  and  manufactures  and markets an extensive and high
quality  line  of  off-highway   micro-cellular   polyurethane   tires  for  the
healthcare, light industrial, lawn and garden and recreational industries.

                                       3
<PAGE>
The current KIK production processes, formulations, manufacturing equipment, and
line of some 150  products  are the  result  of over ten years of  research  and
development,  funded by over $5 million of invested  capital,  and  protected by
trade secrets and licensing agreements.

In its formative  years,  KIK,  through it's research and  development  efforts,
developed new and tougher varieties of urethane  formulations for it's products;
obtained tooling for new products; and added extensive production capacity.
The  Company  introduced  initiated  various  marketing  programs as capital was
available resulting in the following revenues:

         Year ended January 31, 2004 - approximately $3.6 million
         Year ended January 31, 2003 - approximately $3.2 million
         Year ended January 31, 2002 - approximately $2.6 million
         Year ended January 31, 2001 - approximately $3.7 million

Revenues  are  generated  through  direct  sales to the medical  market  segment
(primarily  wheelchair  tires) and  through a network of third  party  marketing
distributors.  KIK continues to develop the  implementation  of other  marketing
strategies,  directly and through carefully  selected new strategic  partners as
the necessary funds are available. The manufacturing  infrastructure  sufficient
to meet projected demand through the next few years is in place.

The Company has relied  upon  Section  4(2) of the  Securities  Act of 1933,  as
amended (the "Act") and Rule 506 of Regulation D promulgated  thereunder  ("Rule
506") for it's issuances of its unregistered securities.  In each instance, such
reliance  was based  upon the fact that (i) the  issuance  of the shares did not
involve  a public  offering,  (ii)  there  were no more  than  thirty-five  (35)
investors (excluding "accredited investors"), (iii) each investor who was not an
accredited  investor  either alone or with his purchaser  representative(s)  has
such  knowledge  and  experience  in financial  and business  matters that he is
capable of evaluating the merits and risks of the prospective investment, or the
issuer  reasonably  believes  immediately  prior to  making  any sale  that such
purchaser comes within this description,  (iv) the offers and sales were made in
compliance  with Rules 501 and 502, (v) the securities  were subject to Rule 144
limitations on resale and (vi) each of the parties was a sophisticated purchaser
and had full  access to the  information  on the  Company  necessary  to make an
informed  investment  decision by virtue of the due  diligence  conducted by the
purchaser or  available  to the  purchaser  prior to the  transaction  (the "506
Exemption").

BUSINESS STRATEGY

KIK is a  manufacturer  of  micro-cellular  polyurethane  (MCP)  tires  with the
technology  and equipment to take  advantage of the growing market for flat-free
tires. It has developed what it considers is an excellent  reputation within the
industry.

It is the objective of the Company to become a major force  throughout the world
as a MCP tire producer. The Company believes the tire industry is looking for an
alternative to pneumatic  tires and that the KIK tires provide a viable,  "value
added"  alternative.  The  Company's  initial focus is to determine the needs of
existing and potential customers and supplying a superior product at competitive
prices.

The  Company   will  also   continue  to  pursue  and   evaluate   new  business
diversification opportunities available to it using its technology.

PRODUCT

KIK  manufactures  polyurethane  tires  by  blending  hydrocarbon-based  quality
isocyanate  intermediates  with  glycol-based  polyols and other chemicals.  The
resulting  compound makes a light but tough tire which the Company believes will
set an evolutionary trend in the tire industry.

KIK tires are environmentally friendly,  puncture and leak proof and maintenance
free.  They ride like a  pneumatic  tire but last much longer due to their tough
polymer construction.

The  Company  also  manufactures   non-tire  urethane  products,   for  non-tire
customers.

                                       4
<PAGE>
THE COMPANY'S EQUIPMENT AND PRODUCTION LINE CAPABILITIES

KIK owns  all the  equipment  necessary  to turn raw  material  to the  finished
product - including tires and completed wheel assemblies.

The Company's  technology and equipment  enable it to produce a large variety of
tires and other  products.  Although the Company is licensed  for three  variant
features of MCP tire  technologies,  it has  developed  its own unique  chemical
formulations  and  manufacturing  processes.  The Company's  production  process
requires the dispensing of catalyzed liquid chemicals into a spinning mold. This
centrifugal  casting of mixed,  activated  polyurethane base stock raw materials
results in a tough molded  polymer with smooth,  solid outer skin and a lighter,
uniformly  dense  porous  foam  core.  KIK tires can be  designed  and molded to
virtually any tread specification and are available in a variety of colors.
The spin  casting  results in  perfectly  balanced  tires.  The  Company has the
equipment to produce,  depending on the size of the tire, 1,500,000 to 2,000,000
tires annually.

The  Company  has a machine  shop and  maintains  its own  testing  and  quality
assurance  equipment and program.  Completed tires must meet specific  protocols
such as weight and pressure.  Whenever possible,  the Company purchases bulk raw
materials in volumes to produce  significant  cost savings in the  manufacturing
process.

The Company is  constantly  looking into  developing  new products and modifying
existing  products for its production  lines, and is evaluating  improvements to
its technology designed to lower production costs and improve competitiveness in
its markets.

PROPRIETARY TECHNOLOGY

The Company  operates under perpetual  licensing  agreements with patent holders
that cover various aspects of tire and equipment designs,  chemical formulations
and manufacturing processes.

MARKETING AND SALES DISTRIBUTION

The Company has grouped the  worldwide  market for  off-highway  tires into four
major market segments,  each possessing  identifiable  business  characteristics
requiring separate sales strategies.

HEALTHCARE:  The  Company's  immediate  focus  is  penetration  of the  existing
wheelchair and power scooter  pneumatic tire business,  with emphasis at the OEM
level.  This has been the  "prototype"  industry  around  which the  Company has
developed  and  perfected its MCP tire  technology.  Through trade shows,  trade
magazine advertising,  distributors and direct sales contacts, an excellent base
has been established to facilitate future growth in this sector.

INDUSTRIAL:  KIK markets light, off-highway industrial and utility tires through
its  strategic  alliance with ARNCO,  A Los Angeles based  producer of pneumatic
tire sealants and foam-fill compounds. ARNCO, a world leader in their field, has
a North  American  distribution  network in place  providing  an  immediate  and
natural sales outlet for KIK's "Carefree"  branded products.  KIK private-labels
tires for ARNCO under the "Carefree Tire" registered trademark, and for selected
high volume customers.

RECREATIONAL: Although the Company has products for recreational devices such as
golf carts and skate boards,  this market is dominated by bicycles.  Previously,
KIK has  discussed  the  manufacture  of bicycle  tires outside of North America
through selected  strategic (joint venture)  partners in countries such as China
active in export  markets,  and where  users are reliant on the bicycle as basic
transportation.  During Fiscal 2004, the Company has become aware of the Chinese
manufacture of products of comparable  quality,  which directly compete with the
Company's  products.  At this time, the expansion of  manufacturing  outside the
Oceanside, California plant is uncertain.

LAWN & GARDEN:  KIK will  attack  the  international  lawn and garden OEM market
directly and through  established  distributors.  Most of Carefree  Tire's North
American downstream tire distribution network services this industry parallel to
the  industrial  market.  Initial  results  indicate that users embrace this new
technology enthusiastically for such applications as wheelbarrows,  powered lawn
mowers,  snow blowers,  and farm carts,  etc.  OEMs are also being  aggressively
pursued in the United States, Canada and Europe.

                                       5
<PAGE>
ADVERTISING & PROMOTION

As the Company has  available  capital,  the Company is  developing a variety of
collateral   materials  to  support  sales  efforts.   These  materials  include
informational and instructional  video tapes, brochures,  product catalogs  with
data sheets,  flyers,  sample presentations etc. The Company also advertises and
markets its products on its website - www.kiktire.com.

COMPETITION

Currently  the  Company  knows  of  three  tire  manufacturers  that  utilize  a
manufacturing process similar to its own (Green Tire, U.K., Alshin Tire, U.S.A.,
Amerityre Corporation,  U.S.A.). The Company has also heard of a manufacturer in
India and one in China. To the best of the Company's  knowledge,  only a limited
number of their tires have been  marketed in the United  States.  The  Company's
main  competition  comes from firms that  manufacture and market tires and tubes
made from  rubber.  Several  of these  competitors  are  large  well-established
companies with considerably  greater financial,  marketing,  sales and technical
resources than those available to the Company.

During Fiscal 2004,  the Company has become aware of the Chinese  manufacture of
products of  comparable  quality,  which  directly  compete  with the  Company's
products.  At this time, the expansion of  manufacturing  outside the Oceanside,
California  plant is  uncertain.  Further,  many of the  Company's  present  and
potential competitors have capabilities that may allow such competitors to offer
its  products  at prices  which may compete  with the  Company's  products.  The
Company's  products  could  be  made  uneconomical  by the  introduction  of new
products  or  marketing  or  pricing  actions  by one or more  of the  Company's
competitors, including foreign competition.

However, the Company believes that once the superior  characteristics of the MCP
tires have been properly  communicated to the consumers,  an increasingly  large
percentage of consumers will switch to the Company's tires.

SOURCES AND AVAILABILITY OF RAW MATERIALS

The materials needed to produce the Company's products are widely available from
numerous third parties.  No shortage of materials is expected in the foreseeable
future.

RESEARCH AND DEVELOPMENT

The  Company  constantly  seeks to improve  its MCP  technology  and develop new
products.  However,  the Company does not anticipate that it will be required to
commit  any  substantial  funds for  existing  development  projects  or for new
research and development.

REGULATION AND ENVIRONMENTAL COMPLIANCE

The Company is subject to general local, state and federal regulations governing
environmental  concerns.  Management  believes  the  Company has always been and
continues to be in compliance with all such laws.

EMPLOYEES

As of April 20, 2004,  the Company has  approximately  22  full-time  employees,
including  3  management/clerical   personnel.   None  of  these  employees  are
represented  by a labor union.  The Company  considers  its  relations  with its
employees  to be  excellent.  The Company may employ  additional  personnel,  as
necessary, to accommodate future expansion.

ITEM 2 - DESCRIPTION OF PROPERTY

The Company maintains its executive offices at 590 Airport Road,  Oceanside,  CA
92054. Its telephone number is (760) 967-2777.

The  Company  leases   approximately   13,480  square  feet  of  space  under  a
non-cancellable  lease,  expiring  in May 2005,  from an  unrelated  third-party
landlord.  The lease requires monthly payments as follows:  $8,307 for the first
12 months; $8,639 for the next 12 months and $8,984 for the next 12 months. Rent
expense  incurred  under this lease was  approximately  $102,340 and $97,800 for
each of the years ended January 31, 2004 and 2003, respectively.

                                       6
<PAGE>
Future amounts due under this lease agreement for facilities are as follows:

                                            Year ending
                                            January 31,             Amount
                                            -----------             ------
                                               2005                $106,428
                                               2006                  35,936
                                                                   --------

                                               Total               $142,364
                                                                    =======

ITEM 3 - LEGAL PROCEEDINGS

The Company may become  involved in various claims and legal actions  arising in
the ordinary  course of  business.  In the opinion of  management,  the ultimate
disposition  of these  matters will not have a material  adverse  impact  either
individually  or  in  the  aggregate  on  consolidated  results  of  operations,
financial position or cash flows of the Company.

As of the  date of  this  filing,  the  Company  is not  involved  in any  legal
proceeding.

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

The Company has not conducted any meetings of shareholders  during the preceding
quarter or periods subsequent thereto.

                                     PART II

ITEM 5 - MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

As of April 20, 2004,  there were  25,021,865  shares of $0.001 par value common
stock (the "Common Stock") of the Company outstanding and owned by approximately
63 shareholders of record,  exclusive of shareholders holding their certificates
in street name.

Our Certificate of Incorporation  authorizes the issuance of 100,000,000  shares
of $0.001 par value common stock.  Our  Certificate  of  Incorporation  does not
allow for the  issuance of any class of  preferred  stock.  Holders of shares of
common  stock are entitled to one vote for each share on all matters to be voted
on by the  stockholders.  Holders of common stock have cumulative voting rights.
Holders of shares of common stock are entitled to share ratably in dividends, if
any,  as may be  declared,  from time to time by the Board of  Directors  in its
discretion,   from  funds  legally  available  therefor.   In  the  event  of  a
liquidation, dissolution, or winding up of the company, the holders of shares of
common stock are entitled to share pro rata all assets  remaining  after payment
in full of all liabilities.  Holders of common stock have no preemptive or other
subscription rights, and there are no conversion rights or redemption or sinking
fund provisions with respect to such shares.

During 2001,  the Company filed a request for clearance of quotations on the OTC
Bulletin Board under SEC Rule 15c2-11,  Subsection  (a)(5) with NASD  Regulation
Inc. A  Clearance  Letter was issued to the  Company  and was issued the trading
symbol "KKTI".

The ask/high and bid/low  information for each calendar  quarter since September
4, 2001,  noting that the  over-the-counter  quotations  provided herein reflect
inter-dealer prices, without retail markup,  mark-down or commission and may not
represent actual transactions.

                                                               High         Low
                                                               ----         ---
FISCAL YEAR ENDED JANUARY 31, 2003
  First quarter 2003 (February 1, 2002 - April 30, 2002)       $0.33       $0.16
  Second quarter 2003 (May 1, 2002 - July 31, 2002)            $0.22       $0.13
  Third quarter 2003 (August 1, 2002 - October 31, 2002)       $0.19       $0.05
  Fourth quarter 2003 (November 1, 2002 - January 31, 2003)    $0.12       $0.04

                                       7
<PAGE>
                                                               High         Low
                                                               ----         ---
FISCAL YEAR ENDED JANUARY 31, 2004
  First quarter 2004 (February 1, 2003 - April 30, 2003)       $0.06       $0.04
  Second quarter 2004 (May 1, 2003 - July 31, 2003)            $0.06       $0.04
  Third quarter 2004 (August 1, 2003 - October 31, 2003)       $0.07       $0.04
  Fourth quarter 2004 (November 1, 2003 - January 31, 2004)    $0.05       $0.02

DIVIDENDS

The Company has never paid or declared  any  dividends  on its common  stock and
does not anticipate paying cash dividends in the foreseeable future.

RECENT SALES OF UNREGISTERED SECURITIES

Effective at the end of each Fiscal  quarter  during the year ended  January 31,
2003, the Company and the holders of the two convertible  notes,  James Hullihan
and Vector II, LLC agreed for the  payment of accrued  interest  in  restricted,
unregistered  common stock.  The Company  issued an aggregate  101,964 shares of
restricted,  unregistered  common  stock in payment of accrued  interest.  These
transactions were valued at an aggregate  approximately  $6,977. The convertible
note  terms  allow  for  the  payment  of  accrued   interest  with  restricted,
unregistered  common stock using an average value of 50% of the daily average of
the market  price of the common  stock for the 30 calendar  days  preceding  the
interest due date. In two instances,  the closing stock price, as discounted was
at or in excess of the closing price on the  settlement  date. In two instances,
the closing stock price on the  settlement  date was in excess of the prescribed
calculation.  The  differential  between  the  discounted  "fair  value" and the
settlement  price resulted in a charge to operations of  approximately  $906 for
compensation  expense  related  to common  stock  issuances  at less than  "fair
value".

Effective  February 1, 2003 and May 1, 2003,  the Company and the holders of the
two convertible notes, James Hullihan and Vector II, LLC, agreed for the payment
of accrued interest in restricted, unregistered common stock. The Company issued
an aggregate 206,987 shares of restricted,  unregistered common stock in payment
of  accrued   interest.   These   transactions   were  valued  at  an  aggregate
approximately  $3,782.  The  convertible  note  terms  allow for the  payment of
accrued  interest with  restricted,  unregistered  common stock using an average
value of 50% of the daily  average of the market  price of the common  stock for
the 30 calendar days  preceding the interest due date.  In both  instances,  the
closing  stock  price on the  settlement  date was in excess  of the  prescribed
calculation.  The  differential  between  the  discounted  "fair  value" and the
settlement  price resulted in a charge to operations of  approximately  $945 for
compensation  expense  related  to common  stock  issuances  at less than  "fair
value".

In February 2003, the Company issued 150,000 restricted,  unregistered shares of
common stock to David Gaal in payment of a contract for marketing services. This
transaction was valued at approximately  $3,000, which was equal to or in excess
of the  discounted  closing  price of the  Company's  common stock on the NASDAQ
Electronic  Bulletin  Board  on the  date of each  respective  transaction.  The
Company relied upon Section 4(2) of The Securities Act of 1933, as amended,  for
an exemption from registration on these shares..

In April 2003,  the Company  issued 22,500  restricted,  unregistered  shares of
common  stock to Camden  Securities  in  settlement  of a January 31, 2003 trade
account  payable  in the  amount  of  approximately  $552.  The  value  of  this
transaction  was equal to or in excess of the  discounted  closing  price of the
Company's  common stock on the NASDAQ  Electronic  Bulletin Board on the date of
each  respective  transaction.  The  Company  relied  upon  Section  4(2) of The
Securities Act of 1933, as amended,  for an exemption from registration on these
shares.

In May 2003,  the Company  issued  575,664  restricted,  unregistered  shares of
common stock in payment of trade accounts payable to Mintmire & Associates,  the
Company's  primary legal counsel,  in the amount of approximately  $72,849.  The
value of this  transaction  was equal to or in excess of the discounted  closing
price of the Company's common stock on the NASDAQ  Electronic  Bulletin Board on
the date of each respective transaction. The Company relied upon Section 4(2) of
The Securities Act of 1933, as amended,  for an exemption from  registration  on
these shares.

                                       8
<PAGE>
ITEM 6 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

OVERVIEW

During  Fiscal 2004 and 2003,  the Company  achieved  revenues of  approximately
$3,639,000  and  $3,156,000 as compared to  approximately  $2,567,000 for Fiscal
2002. These revenues were derived primarily from the sale of tire products.  Net
loss for the year ended January 31, 2004 and 2003 was  approximately $ (199,137)
and $(12,700) as compared to a net loss of approximately ($179,000) for the year
ended January 31, 2002. The net loss for Fiscal 2004 includes a $120,000  charge
for administrative  services to the Company from KIK Tire Technologies Inc., the
Company's  publicly-owned  Canadian majority  shareholder.  The net loss in 2002
included an  extraordinary  gain of  approximately  $203,000  resulting from the
extinguishment  of  trade  accounts  payable  that  related  to  prior  business
operations.  The net loss per share of common stock for Fiscal 2004 and 2003 was
approximately $(0.01) and $0.00 per share.

RESULTS OF OPERATIONS

The following  discussion and analysis of our financial condition and results of
operations  should  be read  in  conjunction  with  the  consolidated  financial
statements and notes.

YEAR ENDED JANUARY 31, 2004 COMPARED TO THE YEAR ENDED JANUARY 31, 2003

The Company  posted net sales of  approximately  $3,639,000  for the fiscal year
ended January 31, 2004 as compared to net sales of approximately  $3,156,000 for
the fiscal year ended  January 31, 2003.  This  increase  reflects  sales of the
Company's  tire products to both key  customers and other third party  customers
during the year as management  made an effort to expand it's sales volume in all
markets using the Company's products

The Company's cost of sales increased by approximately $517,000 to approximately
$3,117,000  for the year ended  January 31,  2004 as  compared to  approximately
$2,600,000 for the year ended January 31, 2003. This increase profiles favorably
to the increase in sales volume  during  Fiscal 2004 and  increases in prices in
raw materials during the year.
Virtually  all of the  increase  is  directly  attributable  to the costs of raw
materials  and direct labor  needed for the  increase in unit volume.  All other
costs  related to production  were  relatively  stable  during Fiscal 2004.  The
Company experienced a gross profit margin of approximately 13.26% (approximately
$522,000)  for Fiscal 2004 as compared to  approximately  17.71%  (approximately
$556,000)  for Fiscal 2002.  The  deterioration  of the gross profit  margin was
attributable to economic  pricing  pressures  caused by foreign  competition and
increases in domestic raw material costs.
Management  is aware of this  situation and is  evaluating  various  remedies to
restore the gross profit percentages experienced in prior years.

General and administrative  expenses  increased from approximately  $578,000 for
Fiscal 2003 to  approximately  $718,000  in Fiscal  2004.  At the KIK  operating
subsidiary level, all general and administrative costs were virtually consistent
(approximately  $575,000 for Fiscal 2004 versus  $525,000 for Fiscal 2003).  The
difference  reflects various overhead  expenses at the corporate  administrative
level which are subject to random  fluctuation  based upon business and overhead
activities,  including a new administrative support charge of $120,000 which was
assessed by KIK Tire Technologies  Inc., the Company's  publicly-owned  Canadian
majority shareholder.

YEAR ENDED JANUARY 31, 2003 AS COMPARED TO THE YEAR ENDED JANUARY 31, 2002

The Company  posted net sales of  approximately  $3,156,000  for the fiscal year
ended January 31, 2003 as compared to net sales of approximately  $2,567,000 for
the fiscal year ended  January 31, 2002.  This  increase  reflects  sales of the
Company's  tire  products  to both key  customers  and  other  new  third  party
customers  during the year as management  made an effort to replace the business
lost during Fiscal 2002.

The Company's cost of sales increased by approximately $354,000 to approximately
$2,600,000  for the year ended  January 31,  2003 as  compared to  approximately
$2,245,000 for the year ended January 31, 2002. This increase profiles favorably
to the  increase  in sales  volume  during  Fiscal  2003.  Virtually  all of the
increase is directly attributable to increased raw material purchases. All other
costs related to production were  relatively  stable during Fiscal 2 The Company
experienced  a  gross  profit  margin  of  approximately  17.71%  (approximately
$556,000)  for Fiscal 2003 as compared to  approximately  12.54%  (approximately
$322,000) for Fiscal 2002.

General and  administrative  expenses  dropped from  approximately  $712,000 for
Fiscal 2002 to  approximately  $578,000  in Fiscal  2003.  At the KIK  operating
subsidiary level, all general and administrative costs were virtually consistent

                                       9
<PAGE>
(approximately  $536,000 for Fiscal 2002 versus  $525,000 for Fiscal 2003).  The
difference  reflects various overhead  expenses at the corporate  administrative
level which are subject to random  fluctuation  based upon business and overhead
activities.

The Company's results of operations have and continue to fluctuate depending on,
amongst  other  things,  the mix of  products  sold;  success  of the  Company's
distributors in penetrating new markets; the timing and availability of products
developed by the Company and/or requested by its customers; and general economic
and political conditions.

LIQUIDITY AND CAPITAL RESOURCES

The Company had cash and cash equivalents of  approximately  $81,000 and $27,000
at January 31, 2004 and 2003,  respectively.  The  Company  maintained  business
liquidity and capital resources during the year adequate to fund all capital and
operating expense  requirements.  During Fiscal 2004,  operations were primarily
funded from internally generated funds. In prior years,  operating capital needs
were supplemented through line of credit borrowings and capital raised through a
private placement of debt and/or equity securities.

For the  years  ended  January  31,  2004  and  2003,  the  Company's  operating
activities  generated  positive  net cash flows of  approximately  $118,000  and
$18,000,  respectively.  Net cash used in operating  activities consists of cash
received from sales of products to customers,  less  purchases of raw materials,
payment of payroll and payment of other general  operating  expenses,  including
interest.

Cash provided by (used in) investing activities was approximately  $(60,000) and
$80,000 for the years ended January 31, 2004 and 2003, respectively.  The Fiscal
2003  increase  was  attributable  to the release of a $100,000  certificate  of
deposit  pledged as collateral  on a revolving  line of credit which was retired
during Fiscal 2003. The Fiscal 2004 cash  utilization  was due to acquisition of
equipment of $(60,000).

The Company  experienced  cash  provided by (used in)  financing  activities  of
approximately $(3,800) and $(87,000) in Fiscal 2004 and 2003, respectively.  The
Fiscal 2004 and 2003 usage  included  the payment of principal on a long capital
lease   payable  of   approximately   $(3,800)   and   $(2,900),   respectively.
Additionally,  during Fiscal 2003, the Company retired the entire balance on the
Bank  line of  credit  in the  amount  of  approximately  $100,000  and had cash
advanced  by the  Company's  publicly-owned  Canadian  majority  shareholder  of
approximately $16,000.

The Company  believes that sufficient cash will be generated  internally to fund
its operations for the next twelve months.

RESTRUCTURED CONVERTIBLE NOTE

On February 16, 2004,  the Company  restructured  the $50,000  convertible  note
payable to Vector II, LLC. Under the  restructured  terms,  the Company paid all
accrued  interest  and  made  a  $3,000  principal  reduction  on  March  16,  2
Thereafter,  the  Company is  obligated  to pay $2,000 per month,  plus  accrued
interest,  for the next six months and $1,000 per month,  plus accrued interest,
thereafter  until all  outstanding  amounts are paid in full.  The  restructured
note bears interest at 10.0% per annum.

The restructured  note is convertible  into shares of  unregistered,  restricted
common  stock at the sole  discretion  of the  Company  provided  that the daily
average  (calculated  from the last sale price daily) of the market price of the
Company's  common stock for any 30 calendar day period  equals or exceeds  $1.00
per share, with the conversion being calculated at a 50% discount of such 30 day
average.

The Noteholder also has the election, with the Company's consent, to receive the
monthly  interest  payments  in  restricted,  unregistered  common  stock of the
Company at the daily average  (calculated from the last sale price daily) of the
market price of the Company's  common stock for the 30 calendar day period prior
to the interest due date, with the number of shares to be issued calculated at a
50% discount of such 30 day average.

Through March 31, 2004, the Company has paid  approximately  $5,000 in principal
and $4,100 in cumulative accrued interest.

                                       10
<PAGE>
CRITICAL ACCOUNTING POLICIES

Financial  Reporting  Release  No.  60,  of the U. S.  Securities  and  Exchange
Commission,   requires  all  companies  to  include  a  discussion  of  critical
accounting policies or methods used in the preparation of financial  statements.
Note B to the Company's  Consolidated Financial Statements includes a summary of
the significant  accounting  policies and methods used in the preparation of the
Company's Consolidated Financial Statements. The following is a brief discussion
of the more significant accounting policies and methods used by the Company.

REVENUE RECOGNITION

     Our revenue  recognition policy is significant because our revenue is a key
     component of our results of operations. The Company recognizes revenue from
     the sale of tires and accessories.  Revenue is recognized upon shipment to,
     or receipt by customers, depending upon contractual terms and when there is
     no significant  uncertainty  regarding the consideration to be received and
     the associated costs to be incurred.  Additionally,  we provide a reduction
     of recorded revenue for billing adjustments and billing corrections.

ACCOUNTS RECEIVABLE

     The  Company  continuously  monitors  collections  and  payments  from  its
     customers and maintains an allowance for estimated  uncollectible  accounts
     based upon historical  experience and specific customer  collections issues
     that have been  identified.  Depending  upon  management's  assessment of a
     customer's  creditworthiness  and order size, certain shipments are made on
     "COD" terms using common carriers.

     Since accounts receivable are concentrated in a relatively few customers, a
     significant  change in the  liquidity or  financial  position of any one of
     these customers could have a material adverse impact on the  collectibility
     of the Company's accounts  receivable and future operating results.  In the
     event of complete non-performance by any customer or customers, the maximum
     exposure  to the Company  would be the  recorded  amount of trade  accounts
     receivable shown on the balance sheet at the date of non-performance.

INVENTORIES

     Inventories  are valued at the lower of cost or market.  Cost is determined
     principally  on the average  cost  method.  The Company  regularly  reviews
     inventory quantities on hand and records,  when necessary,  a provision for
     excess and obsolete  inventory based  primarily on the Company's  estimated
     forecast of product demand and production  requirements for the next twelve
     months.  Demand for the Company's products can fluctuate  significantly.  A
     significant  increase in the demand for the Company's products could result
     in a  short-term  increase  in the  cost  of  inventory  purchases  while a
     significant decrease in demand could result in an increase in the amount of
     excess inventory quantities on hand. In addition, the Company's industry is
     characterized  by  rapid   technological   change,   frequent  new  product
     development and rapid product obsolescence that could result in an increase
     in the amount of obsolete inventory quantities on hand.  Additionally,  the
     Company's estimate of future product demand may prove to be inaccurate,  in
     which case the Company may have  understated  or  overstated  the provision
     required for excess and obsolete inventory. Therefore, although the Company
     makes  every  effort to ensure  the  accuracy  of its  forecasts  of future
     product  demand,  any  significant   unanticipated  changes  in  demand  or
     technological developments could have a significant impact on the Company's
     inventory value and reported operating results.

STOCK-BASED COMPENSATION

     Statement of Financial  Accounting  Standards No. 123, Accounting for Stock
     Based  Compensation,  defines a fair-value  based method of accounting  for
     stock-based employee compensation plans and transactions in which an entity
     issues  its  equity   instruments   to  acquire  goods  and  services  from
     non-employees,  and  encourages  but does not require  companies  to record
     compensation  cost  for  stock-based  employee  compensation  plans at fair
     value.

     For periods  prior to  November 1, 2002,  the Company has chosen to account
     for employee  stock-based  compensation  using the  intrinsic  value method
     prescribed  in  Accounting  Principles  Board  Opinion No. 25 (APB No. 25),
     Accounting  for Stock  Issued to  Employees,  and related  interpretations.
     Accordingly,  employee  compensation cost for stock options and warrants is
     measured as the excess,  if any, of the market price of the Company's stock
     at the date of the grant  over the amount an  employee  must pay to acquire
     the  stock.  This  treatment  was  allowed  under  Statement  of  Financial
     Accounting  Standards No. 123,  "Accounting  for Stock Based  Compensation"
     (SFAS 123).

                                       11
<PAGE>
     In December 2002, FASB issued Statement of Financial  Accounting  Standards
     No.  148  "Accounting  for  Stock-  Based  Compensation  -  Transition  and
     Disclosure"  (SFAS  148).  This  statement  amends  SFAS  123 and  provides
     alternative  methods of transition for a voluntary change to the fair value
     based method of accounting  for  stock-based  employee  compensation.  This
     statement  also amends the disclosure  requirements  of SFAS 123 to require
     more prominent and frequent  disclosures in financial  statements about the
     effects of stock-based  compensation.  The  transition  guidance and annual
     disclosure  provisions of SFAS 148 are  effective for financial  statements
     issued for fiscal years ending after December 15, 2002.  Effective November
     1, 2003,  the first day of the  reporting  quarter  including the effective
     date of SFAS 148, the Company's  Board of Directors,  in  conjunction  with
     public  opinion and SFAS 148,  elected to expense the imputed  compensation
     cost related to any stock options granted during Fiscal 2003 and for future
     periods. The Company did not issue any stock options during Fiscal 2003 and
     the  adoption of SFAS 148 did not have a material  impact on our results of
     operations or financial condition.

ITEM 7 - FINANCIAL STATEMENTS

The  required  consolidated  financial  statements  begin  on  Page  F-1 of this
document.

ITEM 8 -  CHANGES  IN AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON  ACCOUNTING  AND
          FINANCIAL DISCLOSURE

On March 6, 2003, the Company  dismissed the accounting  firm of Horwath Gelfond
Hochstadt  Pangburn,  P.C.  of Denver,  Colorado  as the  Company's  independent
auditors.  The  Company's  Board  of  Directors  made  the  decision  to  change
accountants in an effort to reduce audit costs and limit overhead expenses.

No  accountant's  report on the financial  statements  issued by Horwath Gelfond
Hochstadt Pangburn, P.C. for either of the years ended January 31, 2002 or 2001,
respectively,  contained an adverse  opinion or a  disclaimer  of opinion or was
qualified or modified as to uncertainty, audit scope or accounting principles.

During the Company's two fiscal years (ended January 31, 2002 and 2001) and from
February 1, 2002  through the date of this Report,  there were no  disagreements
with  Horwath  Gelfond  Hochstadt  Pangburn,  P.C.  on any matter of  accounting
principles or practices,  financial disclosure,  or auditing scope or procedure.
There were no reportable  events as described in Item 304(a)(1)(v) of Regulation
S-K, during the Company's two fiscal years (ended January 31, 2002 and 2001) and
from February 1, 2002 to the date of this Report.

On March 6, 2003, the Company  received a letter from Horwath Gelfond  Hochstadt
Pangburn,  P.C.  that it agreed with the  statements  contained in the Company's
Current Report on Form 8-K filing.

On March 6, 2003, the Company engaged the firm of S. W. Hatfield, CPA of Dallas,
Texas as the  Company's  independent  auditors.  Prior to such  engagement,  the
Registrant had not consulted S. W. Hatfield, CPA on any prior matters, including
any matters relative to the application of accounting  principles or any subject
of disagreement with Horwath, Gelfond, Hochstadt, Pangburn, P.C.

ITEM 8A - CONTROLS AND PROCEDURES

As required by Rule 13a-15 under the Exchange  Act,  within the 90 days prior to
the filing date of this report,  the Company  carried out an  evaluation  of the
effectiveness of the design and operation of the Company's  disclosure  controls
and  procedures.  This evaluation was carried out under the supervision and with
the participation of the Company's management, including the Company's President
and Chief Executive  Officer and the Company's Chief  Financial  Officer.  Based
upon that evaluation,  the Company's  President and Chief Executive  Officer and
the Company's Chief Financial  Officer  concluded that the Company's  disclosure
controls and procedures are effective. There have been no significant changes in
the Company's internal controls or in other factors,  which could  significantly
affect  internal  controls  subsequent  to the date the Company  carried out its
evaluation.

Disclosure  controls and procedures are controls and other  procedures  that are
designed to ensure that information  required to be disclosed in Company reports
filed or submitted under the Exchange Act is recorded, processed, summarized and
reported,  within the time  periods  specified  in the  Securities  and Exchange
Commission's  rules and  forms.  Disclosure  controls  and  procedures  include,
without limitation,  controls and procedures designed to ensure that information
required to be  disclosed  in Company  reports  filed under the  Exchange Act is

                                       12
<PAGE>
accumulated  and  communicated  to  management,  including the  Company's  Chief
Executive  Officer and Chief Financial  Officer as appropriate,  to allow timely
decisions regarding required disclosure.

ITEM 9  -  DIRECTORS,   EXECUTIVE  OFFICERS,   PROMOTERS  AND  CONTROL  PERSONS;
           COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

        Name                      Age               Position
        ----                      ---               --------
    Donald P. Dean                68        Chairman and Director
William M. Knooihuizen            60        President and Director
    Kuldip C. Baid                56        Chief Financial Officer and Director

DONALD P. DEAN,  P. ENG.  Donald P. Dean  serves as  Secretary,  Chairman of the
Board and Director of KIK  Technology  International,  Inc. He has been with KIK
Technology,  Inc. since 1987.  From 1984 to 1987, he served as President of Jade
Marble Crafts Ltd., a manufacturer of polyester resin-based plastic products and
Twin Top  Industries  Ltd.  Twin Top was a  manufacturer  of  polyurethane  foam
insulated  fiberglass  well-head  shelters and buildings.  During the 1960's Mr.
Dean worked as an engineer,  distribution  supervisor  and plant  manager of the
Toronto Marketing and Chemical  Distribution  Terminal for Shell Canada Limited.
Subsequently,  he was  President of a  subsidiary  of Trimac  Limited  providing
worldwide  transportation  and logistics  planning,  and  management  consulting
services to  government  and  industry.  Mr. Dean is a  registered  professional
engineer.  He  received a B.Sc.  in civil  engineering  from the  University  of
Saskatchewan  in  1960.  Mr.  Dean is  also an  executive  officer  of KIK  Tire
Technologies Inc., the Company's publicly-owned Canadian majority shareholder.

WILLIAM M.  KNOOIHUIZEN,  PE  William M.  Knooihuizen  serves as  President  and
Director of KKTI. He joined KIK Technology, Inc. in May, 1993, and was appointed
President  and CEO of that company in 1996.  He has over 34 years  experience in
urethane processing technology,  where he has held the positions of V.P./General
Manager  for  Dam  Industries,   Inc.,   United  Foam  Corporation  and  Evanite
Permaglass.  He  received  a degree in  Chemical  Engineering  from  Penn  State
University in 1966.

KULDIP C. BAID,  CA Kuldip C. Baid serves as CFO and  Director  of KKTI.  He has
been with KIK  Technology,  Inc.  since 1987.  Mr. Baid is a Canadian  Chartered
Accountant  who from 1981 to 1986 was Manager of Tax with Turbo  Resources  Ltd.
Previous work  experience  includes public  accounting  practice with Deloitte &
Touche; employment as a financial analyst for Oxford Development Group Ltd.; and
Manager of Accounting for Carma Developers Ltd.. Mr. Baid received a B. Commerce
degree from the University of Alberta in 1976 and completed his certification as
a Chartered  Accountant  in 1979.  Mr. Baid is also an executive  officer of KIK
Tire  Technologies   Inc.,  the  Company's   publicly-owned   Canadian  majority
shareholder.

COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934

No Director,  Officer,  Beneficial  Owner of more than ten percent  (10%) of any
class of  securities of the Company  failed to file reports  required by Section
16(a) of the  Exchange  Act during the most recent  fiscal year or prior  fiscal
years.

ITEM 10 - EXECUTIVE COMPENSATION

The  following  summary   compensation  table  sets  forth  the  aggregate  cash
compensation  paid or accrued by the Company to each of the Company's  executive
officers for services  rendered to the Company during the Company's fiscal years
ended 2003,  2002 and 2001 and all plan and  non-plan  compensation  awarded to,
earned by or paid to certain designated executive officers.

                                       13
<PAGE>
<TABLE>
<CAPTION>
                                                                     Long-Term
                                                                   Compensation
                                    Annual Compensation               Awards              Payouts
                                  ------------------------   -------------------------    -------
                                                 Other       Restricted    Securities                    All
                                  Salary/        Annual         Stock      Underlying      LTIP         Other
Name/Title                Year     Bonus      Compensation     Awards     Options/SARs    Payouts    Compensation
----------                ----    -------     ------------     ------     ------------    -------    ------------
<S>                       <C>      <C>            <C>           <C>           <C>           <C>          <C>
Donald P. Dean            2004     $-0-           $-0-          $-0-          $-0-          $-0-         $-0-
Chairman and Secretary    2003     $-0-           $-0-          $-0-          $-0-          $-0-         $-0-
                          2002     $-0-           $-0-          $-0-          $-0-          $-0-         $-0-

William P. Knooihuizen    2004   $143,000       $15,000         $-0-          $-0-          $-0-         $-0-
President                 2003   $143,000       $15,000         $-0-          $-0-          $-0-         $-0-
                          2002   $143,000       $15,000         $-0-          $-0-          $-0-         $-0-

Kuldip C. Baid            2004    $72,000         $-0-          $-0-          $-0-          $-0-         $-0-
Chief Financial Officer   2003    $72,000         $-0-          $-0-          $-0-          $-0-         $-0-
                          2002     $-0-           $-0-          $-0-          $-0-          $-0-         $-0-
</TABLE>

In  May  2000,  KIK  entered  into  an  employment  agreement  with  William  M.
Knooihuizen,  the Company's  current  President  and  Director.  The term of the
agreement is for a period of five (5) years.  For such  services,  KIK agreed to
pay Mr.  Knooihuizen  an annual  salary in the  amount of  $143,000,  to be paid
weekly.

COMPENSATION OF DIRECTORS

The Company has no  standard  arrangements  for  compensating  directors  of the
Company for their attendance at meetings of the Board of Directors.

ITEM 11 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following  table shows,  as of January 31, 2004,  the shares of Common Stock
beneficially owned by all of the persons who served as the directors or officers
of the Company during Fiscal 2003 as well as the principal shareholders (greater
than 5%) of the Company individually and, as to the directors and officers, as a
group. The address of each person or entity,  unless otherwise noted, is c/o KIK
Technology International, Inc., 590 Airport Road, Oceanside, California 92054.

The number of shares  beneficially  owned by each person or entity is determined
under rules of the Securities and Exchange  Commission,  and the  information is
not necessarily  indicative of beneficial ownership for any other purpose. Under
such rules,  beneficial ownership includes any shares as to which the person has
the sole or shared  voting power or  investment  power and also any shares which
the  person  has the right to  acquire  as of a date  within  60 days  after the
relevant date through the exercise of any stock option or other right.

                                                                  % of Class
     Name and address                 Number of Shares        Beneficially Owned
     ----------------                 ----------------        ------------------
KIK Tire Technologies Inc. (1)           16,700,000                 66.74%
Donald P. Dean                              250,000                  1.00%
William M. Knooihuizen                      250,000                  1.00%
Kuldip C. Baid                              250,000                  1.00%
All officers and directors               17,450,000                 69.74%
 as a group (1)

----------
(1)  Donald  P.  Dean and  Kuldip C.  Baid are  Executive  Officers  of KIK Tire
     Technologies  Inc.,  and as such, may be deemed to have voting control over
     the above listed shares by attribution.

                                       14
<PAGE>
ITEM 12 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

In May 2001, the Company advanced $53,400 to its President, William Knooihuizen,
to hold in trust as a  contingency  fund for the sole use of the  Company in the
event of a  unanticipated  cash  shortfall.  The advance bears  interest at 4.0%
annually and is unsecured.  The original documentation required repayment of the
advance and accrued,  but unpaid,  interest in May 2003. As of January 31, 2004,
with the approval of the Company's Board of Directors,  the Company's  President
continues to maintain these funds as trustee on behalf of the Company.

During the year ended January 31, 2004, the Company accrued  $120,000 payable to
its majority shareholder,  KIK Tire Technologies Inc. (a publicly-owned Canadian
corporation) for administrative services.

ITEM 13 - EXHIBITS AND REPORTS ON FORM 8-K

Exhibits
  31.1    Certification pursuant to Section 302 of Sarbanes-Oxley Act of 2002 -
          Chief Executive Officer
  31.2    Certification pursuant to Section 302 of Sarbanes-Oxley Act of 2002 -
          Chief Financial Officer
  32.1    Certification pursuant to Section 906 of Sarbanes-Oxley Act of 2002

Reports on Form 8-K

  None

ITEM 14 - PRINCIPAL ACCOUNTANT FEES AND SERVICES

The Company paid or accrued the  following  fees in each of the prior two fiscal
years to it's principal accountant,  either S. W. Hatfield, CPA of Dallas, Texas
(for the year ended  January 31, 2004) or Horwath  Gelfond  Hochstadt  Pangburn,
P.C. of Denver, Colorado (for the year ended January 31, 2003)

                                                   Year ended        Year ended
                                                   January 31,       January 31,
                                                      2004              2003
                                                     -------           -------
       a) Audit fees                                 $23,200           $43,950
       b) Audit-related fees                              --                --
       c) Tax fees                                        --                --
       d) All other fees                                  --                --
                                                     -------           -------

          Totals                                     $23,200           $43,950
                                                     =======           =======

The Company has no formal audit committee. However, as defined in Sarbanes-Oxley
Act of 2002,  the entire  Board of  Directors  is the  Company's  defacto  audit
committee.

In discharging its oversight  responsibility as to the audit process,  the Board
obtained from the independent auditors a formal written statement describing all
relationships  between  the  auditors  and the  Company  that  might bear on the
auditors'  independence as required by Independence Standards Board Standard No.
1,  "Independence  Discussions with Audit  Committees." The Board discussed with
the  auditors  any   relationships   that  may  impact  their   objectivity  and
independence,  including fees for non-audit services, and satisfied itself as to
the  auditors'  independence.  The Board also  discussed  with  management,  the
internal  auditors and the independent  auditors the quality and adequacy of the
Company's  internal controls.  The Board reviewed with the independent  auditors
their management letter on internal controls, if one was issued by the Company's
auditors.

The Board  discussed  and  reviewed  with the  independent  auditors all matters
required to be discussed by auditing standards  generally accepted in the United
States of America,  including those described in Statement on Auditing Standards
No. 61, as amended, "Communication with Audit Committees".

                                       15
<PAGE>
The Board reviewed the audited consolidated  financial statements of the Company
as of and for the year ended January 31, 2004 and 2003,  with management and the
independent  auditors.  Management has the sole ultimate  responsibility for the
preparation of the Company's financial  statements and the independent  auditors
have the responsibility for their examination of those statements.

Based  on the  above-mentioned  review  and  discussions  with  the  independent
auditors and management,  the Board of Directors  approved the Company's audited
consolidated  financial  statements and recommended that they be included in its
Annual  Report on Form 10-KSB for the year ended  January 31,  2004,  for filing
with the Securities and Exchange Commission.

The Company's principal accountant,  S. W. Hatfield,  CPA and/or Horwath Gelfond
Hochstadt  Pangburn,  P.C., did not engage any other persons or firms other than
the principal accountant's full-time, permanent employees.

                                       16
<PAGE>
                                   SIGNATURES

In accordance  with Section 13 or 15(d) of the Securities  Exchange Act of 1934,
the registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

                                              KIK TECHNOLOGY INTERNATIONAL, INC.

Dated: April 27, 2004                                         /s/ Kuldip C. Baid
       --------------                         ----------------------------------
                                                                  Kuldip C. Baid
                                                         Chief Financial Officer
                                                                    and Director

In accordance with the Securities Exchange Act of 1934, as amended,  this report
has been signed below by the  following  persons on behalf of the Company and in
the capacities and on the date as indicated.


Dated: April 27, 2004                       by                /s/ Donald P. Dean
       --------------                         ----------------------------------
                                                                  Donald P. Dean
                                                          Chairman and Secretary


Dated: April 27, 2004                                 /s/ William M. Knooihuizen
       --------------                         ----------------------------------
                                                          William M. Knooihuizen
                                                          President and Director


Dated: April 27, 2004                                         /s/ Kuldip C. Baid
       --------------                         ----------------------------------
                                                                  Kuldip C. Baid
                                                         Chief Financial Officer
                                                                    and Director

                                       17
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS


                                                                            PAGE
                                                                            ----

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS                          F-2

CONSOLIDATED FINANCIAL STATEMENTS

   Consolidated Balance Sheets
   as of January 31, 2004 and 2003                                          F-3

   Consolidated Statements of Operations and Comprehensive Loss
   for the years ended January 31, 2004 and 2003                            F-4

   Consolidated Statement of Changes in Stockholders' Equity
   for the years ended January 31, 2004 and 2003                            F-5

   Consolidated Statements of Cash Flows
   for the years ended January 31, 2004 and 2003                            F-6

   Notes to Consolidated Financial Statements                               F-7

                                      F-1
<PAGE>
                        LETTERHEAD OF S. W. HATFIELD, CPA

               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS


Board of Directors and Stockholders
KIK Technology International, Inc.

We have audited the  accompanying  consolidated  balance sheet of KIK Technology
International,  Inc. and Subsidiary (California  corporations) as of January 31,
2004  and  2003  and the  related  consolidated  statements  of  operations  and
comprehensive  loss, changes in stockholders'  equity and cash flows for each of
the years  ended  January 31, 2004 and 2003,  respectively.  These  consolidated
financial  statements are the  responsibility of the Company's  management.  Our
responsibility  is  to  express  an  opinion  on  these  consolidated  financial
statements based on our audits.

We conducted our audit in accordance with auditing standards  generally accepted
in the  United  States of  America.  Those  standards  require  that we plan and
perform the audit to obtain reasonable  assurance about whether the consolidated
financial  statements  are free of  material  misstatement.  An  audit  includes
examining,  on a test basis,  evidence supporting the amounts and disclosures in
the  consolidated  financial  statements.  An audit also includes  assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall  consolidated  financial  statement  presentation.  We
believe that our audit provides a reasonable basis for our opinion.

The consolidated financial statements referred to above, in our opinion, present
fairly, in all material  respects,  the consolidated  financial  position of KIK
Technology  International,  Inc. and  Subsidiary as of January 31, 2004 and 2003
and the results of their consolidated  operations and cash flows for each of the
years  ended  January  31,  2004 and  2003,  respectively,  in  conformity  with
accounting principles generally accepted in the United States of America.


                                             /s/ S. W. Hatfield, CPA
                                             -----------------------------
                                             S. W. HATFIELD, CPA
Dallas, Texas
April 14, 2004

                                      F-2
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY
                           CONSOLIDATED BALANCE SHEETS
                            January 31, 2004 and 2003
<TABLE>
<CAPTION>
                                                                         January 31,           January 31,
                                                                            2004                  2003
                                                                         -----------           -----------
<S>                                                                      <C>                   <C>
                                     ASSETS
CURRENT ASSETS
  Cash on hand and in bank                                               $    80,514           $    26,692
  Accounts receivable
  Trade, net of allowance for doubtful accounts
   of approximately $14,230 and $16,215, respectively                        372,186               372,209
  Other                                                                        7,543                 5,407
  Inventories                                                                323,063               301,411
  Prepaid expenses                                                             2,692                   436
                                                                         -----------           -----------
     TOTAL CURRENT ASSETS                                                    785,998               706,155
                                                                         -----------           -----------

PROPERTY AND EQUIPMENT - AT COST                                             636,780               576,782
  Less Accumulated depreciation                                             (479,227)             (438,239)
                                                                         -----------           -----------
     NET PROPERTY AND EQUIPMENT                                              157,553               138,543
                                                                         -----------           -----------
OTHER ASSETS
  Funds held in trust by officer                                              53,400                53,400
  Refundable deposits                                                          4,800                 4,800
  Deferred debt issuance costs, net of accumulated amortization
   of approximately $21,840 and $12,740, respectively                             --                 9,100
                                                                         -----------           -----------
     TOTAL OTHER ASSETS                                                       58,200                67,300
                                                                         -----------           -----------

TOTAL ASSETS                                                             $ 1,001,751           $   911,998
                                                                         ===========           ===========

                      LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
  Notes payable to investors, net of accompanying warrant
    discount of approximately $-0- and $4,775                            $    75,000           $    70,225
  Current maturity of capital lease payable                                    4,095                 3,738
  Accounts payable - trade                                                   286,773               170,447
  Other accrued expenses                                                      42,454                72,020
  Advances from and amounts payable to majority shareholder                  136,000                16,000
                                                                         -----------           -----------
     TOTAL CURRENT LIABILITIES                                               544,322               332,430
                                                                         -----------           -----------
LONG-TERM DEBT
  Capital lease payable                                                       10,336                14,465
                                                                         -----------           -----------
     TOTAL LIABILITIES                                                       554,658               346,895
                                                                         -----------           -----------

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY
  Common stock - $0.001 par value
    100,000,000 shares authorized
    25,021,865 and 24,086,964 shares issued and outstanding                   25,022                24,087
  Additional paid-in capital                                               5,146,573             5,066,381
  Accumulated deficit                                                     (4,724,502)           (4,525,365)
                                                                         -----------           -----------
     TOTAL STOCKHOLDERS' EQUITY                                              447,093               565,103
                                                                         -----------           -----------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                               $ 1,001,751           $   911,998
                                                                         ===========           ===========
</TABLE>
              The accompanying notes are an integral part of these
                       consolidated financial statements.

                                      F-3
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY
          CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
                      Years ended January 31, 2004 and 2003
<TABLE>
<CAPTION>
                                                                        Year ended             Year ended
                                                                        January 31,            January 31,
                                                                           2004                   2003
                                                                       ------------           ------------
<S>                                                                    <C>                    <C>
REVENUES - net of returns and allowances                               $  3,639,289           $  3,155,541

COST OF SALES
  Raw materials                                                           2,247,110              1,869,179
  Direct labor and other costs                                              831,358                695,524
  Depreciation                                                               38,589                 35,096
                                                                       ------------           ------------
     TOTAL COST OF SALES                                                  3,117,057              2,599,799
                                                                       ------------           ------------

GROSS PROFIT                                                                522,232                555,742
                                                                       ------------           ------------

OPERATING EXPENSES
  Selling and marketing expenses                                              6,500                     --
  General and administrative expenses
    Salaries and related expenses                                            91,772                110,672
    Other operating expenses                                                487,634                454,049
  Administrative service fee to majority shareholder                        120,000                     --
  Depreciation and amortization                                              11,500                 13,304
  Compensation expense related to common
   stock issuances at less than "fair value"                                    945                    906
                                                                       ------------           ------------
     TOTAL OPERATING EXPENSES                                               718,351                578,931
                                                                       ------------           ------------

LOSS FROM OPERATIONS                                                       (196,119)               (23,189)

OTHER INCOME
  Interest expense                                                          (13,823)               (16,032)
  Interest and other income                                                  10,805                 26,532
                                                                       ------------           ------------

LOSS BEFORE PROVISION FOR INCOME TAXES AND EXTRAORDINARY ITEM              (199,137)               (12,689)

PROVISION FOR INCOME TAXES                                                       --                     --
                                                                       ------------           ------------

NET LOSS                                                                   (199,137)               (12,689)

OTHER COMPREHENSIVE INCOME                                                       --                     --
                                                                       ------------           ------------

COMPREHENSIVE LOSS                                                     $   (199,137)          $    (12,689)
                                                                       ============           ============
Net loss per weighted-average share
 of common stock outstanding, calculated
 on Net Loss - basic and fully diluted                                 $      (0.01)          $      (0.00)
                                                                       ============           ============
Weighted-average number of shares
 of common stock outstanding                                             24,840,873             24,035,930
                                                                       ============           ============
</TABLE>
              The accompanying notes are an integral part of these
                       consolidated financial statements.

                                      F-4
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY
            CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
                      Years ended January 31, 2004 and 2003

<TABLE>
<CAPTION>
                                            Common Stock       Additional
                                       --------------------     paid-in      Accumulated
                                       Shares        Amount     capital        deficit         Total
                                       ------        ------     -------        -------         -----
<S>                                 <C>            <C>        <C>           <C>             <C>
BALANCES AT FEBRUARY 1, 2002         23,985,000     $23,985    $5,058,600    $(4,512,676)    $ 569,909

Issuance of common stock for
 Payment of accrued interest            101,964         102         6,875             --         6,977
 Compensation expense related
 to issuance of shares at
 less than "fair value"                      --          --           906             --           906

Net loss for the year                        --          --            --        (12,689)      (12,689)
                                     ----------     -------    ----------    -----------     ---------

BALANCES AT JANUARY 31, 2003         24,086,964      24,087     5,066,381     (4,525,365)      565,103

Issuance of common stock for
 Payment of accrued interest            186,737         187         3,595             --         3,782
 Compensation expense related
 to issuance of shares at
 less than "fair value"                      --          --           945             --           945
Payment of trade accounts payable       598,164         598        72,802             --        73,400
Payment of consulting fees              150,000         150         2,850             --         3,000

Net loss for the year                        --          --            --       (199,137)     (199,137)
                                     ----------     -------    ----------    -----------     ---------

BALANCES AT JANUARY 31, 2004         25,021,865     $25,022    $5,146,573    $(4,724,502)    $ 447,093
                                     ==========     =======    ==========    ===========     =========
</TABLE>
              The accompanying notes are an integral part of these
                       consolidated financial statements.

                                      F-5
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                      Years ended January 31, 2004 and 2003
<TABLE>
<CAPTION>
                                                              Year ended        Year ended
                                                              January 31,       January 31,
                                                                 2004              2003
                                                               ---------         ---------
<S>                                                            <C>               <C>
CASH FLOWS FROM OPERATING ACTIVITIES
  Net loss for the year                                        $(199,137)        $ (12,689)
  Adjustments to reconcile net loss to net cash
   provided by operating activities
     Depreciation and amortization                                50,089            48,400
     Amortization of warrant discount on notes payable             4,775             5,896
     Provision for doubtful accounts receivable                   (1,986)           16,215
     Expenses paid with common stock                               6,780             6,977
     Compensation expense related to common stock
      issuances at less than "fair value"                            945               906
  (Increase) Decrease in
     Accounts receivable - trade and other                          (127)          105,415
     Inventory                                                   (21,652)           24,761
     Prepaid expenses and other                                   (2,256)               --
  Increase (Decrease) in
     Accounts payable                                            189,727          (216,699)
     Other accrued expenses                                      (29,566)           38,576
     Accrued management fees to parent company                   120,000                --
                                                               ---------         ---------
NET CASH USED IN OPERATING ACTIVITIES                            117,592            17,758
                                                               ---------         ---------
CASH FLOWS FROM INVESTING ACTIVITIES
  Decrease in restricted cash                                         --           100,000
  Purchase of property and equipment                             (59,998)          (19,887)
                                                               ---------         ---------
NET CASH USED IN INVESTING ACTIVITIES                            (59,998)           80,113
                                                               ---------         ---------
CASH FLOWS FROM FINANCING ACTIVITIES
  Payments on long-term capital lease                             (3,772)           (2,877)
  Net borrowings (payments) on bank line of credit                    --           (99,981)
  Cash advanced by majority shareholder                               --            16,000
                                                               ---------         ---------
NET CASH USED IN FINANCING ACTIVITIES                             (3,772)          (86,858)
                                                               ---------         ---------

INCREASE (DECREASE) IN CASH                                       53,822            11,013

Cash at beginning of period                                       26,692            15,679
                                                               ---------         ---------

CASH AT END OF PERIOD                                          $  80,514         $  26,692
                                                               =========         =========
SUPPLEMENTAL DISCLOSURE OF INTEREST
AND INCOME TAXES PAID
  Interest paid for the period                                 $   3,439         $   2,636
                                                               =========         =========
  Income taxes paid for the period                             $      --         $      --
                                                               =========         =========
SUPPLEMENTAL DISCLOSURE OF NON-CASH
INVESTING AND FINANCING ACTIVITIES
  Acquisition of equipment on a long-term capital lease        $      --         $  21,080
                                                               =========         =========
</TABLE>
              The accompanying notes are an integral part of these
                       consolidated financial statements.

                                      F-6
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE A - ORGANIZATION AND DESCRIPTION OF BUSINESS

KIK Technology  International,  Inc. (KTII) was incorporated on February 1, 2000
under   the  laws  of  the   State   of   California   as   Russian-Imports.com.
Russian-Imports.com  was  initially  founded to develop an  internet  e-commerce
website which would sell handmade  lacquer  boxes,  Matroshka  dolls and crystal
imported from Russia.  This business plan was  unsuccessful  and,  subsequently,
terminated.  The Company then adopted a business plan to locate and combine with
an existing,  privately-held  company  which is profitable  or, in  management's
view, has growth potential, irrespective of the industry in which it is engaged.

On September 4, 2001,  KTII  (formerly  Russian-Imports.com)  issued  16,700,000
shares of restricted,  unregistered common stock to KIK Tire Technologies,  Inc.
(a  publicly-owned  Canadian  corporation)  (KTTI)  for 100.0% of the issued and
outstanding stock of KIK Technology,  Inc. (a wholly-owned  subsidiary of KTTI).
By  virtue of this  transaction,  KIK  Technology,  Inc.  became a  wholly-owned
subsidiary of KTII and KTTI became an  approximate  73.6%  shareholder  in KTII.
Concurrent  with this  transaction,  Russian-Imports.com  changed it's corporate
name to KIK Technologies International, Inc.

At the transaction date, KTII was a "shell company" as the Company had no assets
or liabilities, had generated no revenues since inception and had incurred total
expenses  of  approximately  $940,000  since its  inception  on February 1, 2000
through the September 4, 2001 transaction.

KIK Technology,  Inc. (KTI) was  incorporated in June 1988 under the laws of the
State of California.  KTI manufactures and markets an extensive and high quality
line of off-highway micro-cellular polyurethane tires for the healthcare,  light
industrial,  lawn and garden and  recreational  industries.  KTI operates from a
sole manufacturing plant and marketing offices located in Oceanside, CA.

The Company's  principal raw materials are purchased from a sole supplier who is
also a major customer for the Company's products. In the event of any disruption
in the  availability  of raw  materials or a market for the  Company's  products
purchased by this key supplier,  the Company may experience a negative  economic
impact.  The Company  believes that  suppliers of raw materials are available at
comparable prices and management is seeking other avenues of distribution of the
Company's  products  to  consumers.   Management  is  of  the  opinion  that  no
interruption of either raw materials or product demand will occur.

NOTE B - PREPARATION OF FINANCIAL STATEMENTS

The  acquisition of KIK  Technology,  Inc.  (KTI), on September 4, 2001, by KTII
effected  a change  in  control  of KTII  and was  accounted  for as a  "reverse
acquisition"  whereby KTI is the  accounting  acquiror for  financial  statement
purposes.  Accordingly,  the historical consolidated financial statements of the
Company  are those of KTI from  it's  inception  and  those of the  consolidated
entity subsequent to the September 4, 2001 transaction date.

The  Company  follows  the  accrual  basis  of  accounting  in  accordance  with
accounting principles generally accepted in the United States of America and has
adopted a year-end of January 31.

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States of America requires  management to make
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities  and disclosure of contingent  assets and liabilities at the date of
the  financial  statements  and the  reported  amounts of revenues  and expenses
during the reporting period. Actual results could differ from those estimates.

Management further acknowledges that it is solely responsible for adopting sound
accounting  practices,   establishing  and  maintaining  a  system  of  internal
accounting  control and preventing and detecting  fraud. The Company's system of
internal  accounting  control is designed to assure,  among other items, that 1)
recorded  transactions  are valid; 2) valid  transactions  are recorded;  and 3)
transactions  are  recorded in the proper  period in a timely  manner to produce
financial  statements which present fairly the financial  condition,  results of
operations  and cash  flows of the  Company  for the  respective  periods  being
presented.

                                      F-7
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE B - PREPARATION OF FINANCIAL STATEMENTS - CONTINUED

For  segment  reporting  purposes,  the Company  operated  in only one  industry
segment during the periods represented in the accompanying  financial statements
and makes all  operating  decisions and  allocates  resources  based on the best
benefit to the Company as a whole.

These  financial  statements  reflect  the books and  records of KIK  Technology
International,  Inc. (formerly Russian-Imports.com) (KTII) and  KIK  Technology,
Inc.  (KTI)  as  of  and  for  the  years  ended  January  31,  2004  and  2003,
respectively.  All significant intercompany transactions have been eliminated in
consolidation. The consolidated entities are referred to as Company.

NOTE C - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1. CASH AND CASH EQUIVALENTS

     For  Statement of Cash Flows  purposes,  the Company  considers all cash on
     hand  and  in  banks,  including  accounts  in  book  overdraft  positions,
     certificates of deposit and other highly-liquid investments with maturities
     of three months or less, when purchased, to be cash and cash equivalents.

     Cash  overdraft  positions may occur from time to time due to the timing of
     making bank deposits and releasing checks, in accordance with the Company's
     cash management policies.

2. ACCOUNTS RECEIVABLE AND REVENUE RECOGNITION

     In the normal course of business,  the Company extends  unsecured credit to
     virtually all of its customers war located throughout the United States and
     are  principally  concentrated  in  the  midwest  region  of  the  country.
     Depending upon management's  assessment of creditworthiness and order size,
     certain shipments are made on "COD" terms using common carriers. Because of
     the credit risk involved, management has provided an allowance for doubtful
     accounts which reflects its opinion of amounts which will eventually become
     uncollectible.  In the  event  of  complete  non-performance,  the  maximum
     exposure to the Company is the recorded amount of trade accounts receivable
     shown on the balance sheet at the date of non-performance.

     The Company  recognizes revenue from the sale of tires and accessories upon
     shipment to, or receipt by customers,  depending upon contractual terms and
     when there is no significant  uncertainty regarding the consideration to be
     received and the associated costs to be incurred. Additionally, the Company
     recognizes   reductions  of  recorded  revenue  for  product  returns  from
     unsatisfied customers and other billing adjustments or corrections,  at the
     point that the  returned  products  are received by the Company or upon the
     completion of negotiations between the Company and it's customer.

3. INVENTORY

     Inventory consists of raw materials,  principally chemical feedstocks,  and
     finished  goods,  principally  tires and  accessories  manufactured  by the
     Company and other minor  miscellaneous  items  purchased  from  third-party
     vendors for resale as a component of the Company's products.

     Inventory is valued at the lower of cost or market value, using principally
     the average cost method.

                                      F-8
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE C - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

4. PROPERTY AND EQUIPMENT

     Property and  equipment are recorded at  historical  cost.  These costs are
     depreciated  over the estimated useful lives generally two (2) to seven (7)
     years, of the individual assets using the straight-line  method.  Gains and
     losses from the  disposition  of property  and  equipment  are  included in
     operations as incurred.

     In accordance  with  Statement of Financial  Accounting  Standards No. 144,
     "Accounting  for the  Impairment  or Disposal of  Long-Lived  Assets",  the
     Company  follows the policy of evaluating  all property and equipment as of
     the end of each reporting quarter.  For each of the years ended January 31,
     2004 and 2003, no charges to operations  were made for  impairments  in the
     future benefit of property and equipment.

5. DEFERRED DEBT ISSUE COSTS

     Deferred  debt issue costs  represent  monies paid  investment  bankers and
     legal  counsel in  connection  with the issuance of $75,000 in  convertible
     notes payable.  These costs are amortized as a component of operations over
     the life of the underlying debt instrument using the straight line method.

6. INCOME TAXES

     The Company uses the asset and liability  method of  accounting  for income
     taxes.  At January 31, 2004 and 2003,  the  deferred tax asset and deferred
     tax  liability  accounts,  as  recorded  when  material  to  the  financial
     statements,  are entirely the result of  temporary  differences.  Temporary
     differences   represent  differences  in  the  recognition  of  assets  and
     liabilities for tax and financial reporting purposes, primarily accumulated
     depreciation and amortization, allowance for doubtful accounts and vacation
     accruals.

     As of January  31, 2004 and 2003,  the  deferred  tax asset  related to the
     Company's net operating loss carryforward is fully reserved.

7. ADVERTISING COSTS

     The Company does not conduct any direct  response  advertising  activities.
     For non-direct response advertising, the Company charges the costs of these
     efforts  to  operations  at the  first  time  the  related  advertising  is
     published.

8. EARNINGS (LOSS) PER SHARE

     Basic  earnings  (loss) per share is computed  by  dividing  the net income
     (loss) by the weighted-average  number of shares of common stock and common
     stock  equivalents  (primarily  outstanding  options and warrants).  Common
     stock equivalents  represent the dilutive effect of the assumed exercise of
     the  outstanding  stock  options and  warrants,  using the  treasury  stock
     method.  The calculation of fully diluted earnings (loss) per share assumes
     the dilutive effect of the exercise of outstanding  options and warrants at
     either the  beginning  of the  respective  period  presented or the date of
     issuance,  whichever  is  later.  As of  January  31,  2004 and  2003,  the
     Company's  issued and outstanding,  warrants,  options and convertible debt
     are  considered  antidilutive  due  to the  Company's  net  operating  loss
     position.

                                      F-9
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE C - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

9. EMPLOYEE STOCK OPTIONS

     For periods  prior to November  1, 2002,  the Company  chose to account for
     employee   stock-based   compensation  using  the  intrinsic  value  method
     prescribed  in  Accounting  Principles  Board  Opinion No. 25 (APB No. 25),
     Accounting  for Stock  Issued to  Employees,  and related  interpretations.
     Accordingly,  employee  compensation cost for stock options and warrants is
     measured as the excess,  if any, of the market price of the Company's stock
     at the date of the grant  over the amount an  employee  must pay to acquire
     the  stock.  This  treatment  was  allowed  under  Statement  of  Financial
     Accounting  Standards No. 123,  "Accounting  for Stock Based  Compensation"
     (SFAS 123).

     In December 2002, FASB issued Statement of Financial  Accounting  Standards
     No.  148  "Accounting  for  Stock-  Based  Compensation  -  Transition  and
     Disclosure"  (SFAS  148).  This  statement  amends  SFAS  123 and  provides
     alternative  methods of transition for a voluntary change to the fair value
     based method of accounting  for  stock-based  employee  compensation.  This
     statement  also amends the disclosure  requirements  of SFAS 123 to require
     more prominent and frequent  disclosures in financial  statements about the
     effects of stock-based  compensation.  The  transition  guidance and annual
     disclosure  provisions of SFAS 148 are  effective for financial  statements
     issued for fiscal years ending after December 15, 2002.  Effective November
     1, 2003,  the first day of the  reporting  quarter  including the effective
     date of SFAS 148, the Company's  Board of Directors,  in  conjunction  with
     public  opinion and SFAS 148,  elected to expense the imputed  compensation
     cost related to any stock options granted during Fiscal 2003 and for future
     periods.  The Company did not issue any stock options during Fiscal 2004 or
     Fiscal 2003 and the adoption of SFAS 148 did not have a material  impact on
     our results of operations or financial condition.

10. NEW AND PENDING ACCOUNTING PRONOUNCEMENTS

     Statement  of  Financial  Accounting  Standard  (SFAS) No. 143  establishes
     accounting  standards  for the  recognition  and  measurement  of an  asset
     retirement  obligation and its associated  asset  retirement  cost. It also
     provides  accounting  guidance for legal  obligations  associated  with the
     retirement of tangible long-lived assets. SFAS No.
     143 is effective in fiscal years  beginning after June 15, 2002, with early
     adoption permitted.  The Company adopted SFAS No. 143 effective February 1,
     2003  and  the  adoption  had no  impact  on its  consolidated  results  of
     operations and financial position.

     SFAS No. 144  establishes a single  accounting  model for the impairment or
     disposal of long-lived assets, including discontinued operations.  SFAS No.
     144  superseded  Statement  of  Financial  Accounting  Standards  No.  121,
     "Accounting  for the  Impairment  of Long-Lived  Assets and for  Long-Lived
     Assets  to Be  Disposed  Of"  (SFAS  No.  121),  and APB  Opinion  No.  30,
     "Reporting the Results of Operations - Reporting the Effects of Disposal of
     a Segment  of a  Business,  and  Extraordinary,  Unusual  and  Infrequently
     Occurring  Events  and  Transactions".  The  Company  adopted  SFAS No. 144
     effective  February 1, 2002.  The  adoption of SFAS No. 144 had no material
     impact on Company's consolidated financial statements.

     In April 2002, the Financial  Accounting Standards Board (FASB) issued SFAS
     No. 145,  "Rescission of FASB  Statements  No. 4, 44, and 64,  Amendment of
     SFAS No. 13, and Technical  Corrections."  This  Statement  rescinds  SFAS,
     "Reporting Gains and Losses from  Extinguishment of Debt", and an amendment
     of that Statement,  SFAS No. 64,  "Extinguishments  of Debt Made to Satisfy
     Sinking-Fund  Requirements"  and SFAS No. 44,  "Accounting  for  Intangible
     Assets of Motor Carriers".  This Statement amends SFAS No. 13,  "Accounting
     for Leases," to eliminate an inconsistency  between the required accounting
     for  sale-leaseback  transactions  and the required  accounting for certain
     lease  modifications  that have economic  effects that are similar to sale-
     leaseback  transactions.  We do not expect the  adoption to have a material
     impact to our financial position or results of operations.

                                      F-10
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE C - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

10. NEW AND PENDING ACCOUNTING PRONOUNCEMENTS - continued

     In June  2002,  the  FASB  issued  SFAS  No.  146,  "Accounting  for  Costs
     Associated  with Exit or Disposal  Activities."  This  Statement  addresses
     financial  accounting  and  reporting  for  costs  associated  with exit or
     disposal  activities and nullifies  Emerging Issues Task Force (EITF) Issue
     No. 94-3, "Liability  Recognition for Certain Employee Termination Benefits
     and Other Costs to Exit an Activity  (including Certain Costs Incurred in a
     Restructuring)." The provisions of this statement are effective for exit or
     disposal  activities that are initiated after December 31, 2002, with early
     application  encouraged.  We do not expect the  adoption of SFAS No. 146 to
     have a material impact to our financial position or results of operations.

     In October  2002,  the FASB issued SFAS No. 147,  "Acquisitions  of Certain
     Financial  Institutions-an  amendment  of SFAS  No.  72 and  144  and  SFAS
     Interpretation No. 9," which removes acquisitions of financial institutions
     from the scope of both Statement 72 and  Interpretation 9 and requires that
     those  transactions  be  accounted  for in  accordance  with SFAS No.  141,
     "Business  Combinations",  and SFAS No. 142, "Goodwill and Other Intangible
     Assets". In addition,  this Statement amends SFAS No. 144,  "Accounting for
     the Impairment or Disposal of Long- Lived Assets",  to include in its scope
     long-term customer-relationship intangible assets of financial institutions
     such as depositor- and  borrower-relationship  intangible assets and credit
     cardholder  intangible assets. The requirements relating to acquisitions of
     financial institutions are effective for acquisitions for which the date of
     acquisition  is on or after  October 1,  2002.  The  provisions  related to
     accounting   for  the   impairment   or  disposal   of  certain   long-term
     customer-relationship  intangible  assets are effective on October 1, 2002.
     The  adoption  of this  statement  did not have a  material  impact  to our
     financial  position  or results  of  operations  as we have not  engaged in
     either of these activities.

     In December 2002, the FASB issued SFAS No. 148, "Accounting for Stock-Based
     Compensation-Transition   and  Disclosure,"  which  amends  SFAS  No.  123,
     "Accounting for Stock-Based  Compensation",  to provide alternative methods
     of  transition  for a voluntary  change to the fair value  based  method of
     accounting  for  stock-based  employee  compensation.   In  addition,  this
     statement  amends the  disclosure  requirements  of SFAS No. 123 to require
     prominent disclosures in both annual and interim financial statements about
     the method of accounting  for  stock-based  employee  compensation  and the
     effect of the method used on reported results.  The transition guidance and
     annual disclosure provisions of SFAS No. 148 are effective for fiscal years
     ending  after  December 15, 2002,  with  earlier  application  permitted in
     certain circumstances.  The interim disclosure provisions are effective for
     financial  reports  containing  financial  statements  for interim  periods
     beginning  after  December 15, 2002. The adoption of this statement did not
     have a material  impact on our financial  position or results of operations
     as we have  not  elected  to  change  to the fair  value  based  method  of
     accounting for stock-based employee compensation.

     In January 2003, the FASB issued  Interpretation No. 46,  "Consolidation of
     Variable  Interest  Entities."  Interpretation  46 changes the  criteria by
     which one company includes  another entity in its consolidated  financial s
     Previously,  the criteria were based on control  through  voting  interest.
     Interpretation 46 requires a variable interest entity to be consolidated by
     a company if that company is subject to a majority of the risk of loss from
     the variable interest entity's activities or entitled to receive a majority
     of the entity's  residual  returns or both. A company that  consolidates  a
     variable interest entity is called the primary  beneficiary of that entity.
     The  consolidation  requirements of  Interpretation 46 apply immediately to
     variable   interest   entities   created  after   January  31,  2003.   The
     consolidation requirements apply to older entities in the first fiscal year
     or interim  period  beginning  after  June 15, 2 Certain of the  disclosure
     requirements  apply in all  financial  statements  issued after January 31,
     2003,  regardless of when the variable interest entity was established.  We
     do not  expect the  adoption  to have a  material  impact to our  financial
     position or results of operations.

                                      F-11
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE C - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

10. NEW AND PENDING ACCOUNTING PRONOUNCEMENTS - continued

     In April 2003,  the FASB issued SFAS No. 149,  "Amendment  of Statement No.
     133 on Derivative Instruments and Hedging Activities".  SFAS No. 149 amends
     SFAS No. 133 to  provide  clarification  on the  financial  accounting  and
     reporting of derivative  instruments  and hedging  activities  and requires
     that  contracts  with  similar   characteristics  be  accounted  for  on  a
     comparable  basis.  The  provisions  of  SFAS  No.  149 are  effective  for
     contracts  entered into or modified  after June 30,  2003,  and for hedging
     relationships  designated after June 30, 2003. The adoption of SFAS No. 149
     did not have a material  impact on our results of  operations  or financial
     position.

     In May  2003,  the  FASB  issued  SFAS No.  150,  "Accounting  for  Certain
     Financial Instruments with Characteristics of Both Liabilities and Equity".
     SFAS No. 150 establishes standards on the classification and measurement of
     certain financial  instruments with characteristics of both liabilities and
     equity. The provisions of SFAS N15 are effective for financial  instruments
     entered  into or modified  after May 31, 2003 and to all other  instruments
     that exist as of the  beginning of the first  interim  financial  reporting
     period  beginning after June 15, 2003. The adoption of SFAS No. 150 did not
     have a material impact on our results of operations or financial position.

NOTE D - FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying amount of cash,  accounts  receivable,  accounts  payable and notes
payable, as applicable,  approximates fair value due to the short term nature of
these items  and/or the current  interest  rates  payable in relation to current
market conditions.

Interest  rate risk is the risk  that the  Company's  earnings  are  subject  to
fluctuations  in interest  rates on either  investments  or on debt and is fully
dependent  upon  the  volatility  of  these  rates.  The  Company  does  not use
derivative instruments to moderate its exposure to interest rate risk, if any.

Financial  risk  is  the  risk  that  the  Company's  earnings  are  subject  to
fluctuations in interest rates or foreign exchange rates and are fully dependent
upon the  volatility  of  these  rates.  The  company  does  not use  derivative
instruments to moderate its exposure to financial risk, if any.

NOTE E - CONCENTRATIONS OF CREDIT RISK

KTII and KTI maintain their  respective cash accounts in financial  institutions
subject  to  insurance   coverage  issued  by  the  Federal  Deposit   Insurance
Corporation  (FDIC).  Under  FDIC  rules,  both  KTII  and KTI are  entitled  to
aggregate  coverage of $100,000 per account  type per separate  legal entity per
financial  institution.  During  the  years  ended  January  31,  2004 and 2003,
respectively,  the  various  entities,  from  time-to-time,  had  deposits  in a
financial  institution  with credit risk  exposures in excess of statutory  FDIC
coverage.  The Company has incurred no losses  during  Fiscal 2004 and 2003 as a
result of any of these unsecured situations.

NOTE F - INVENTORIES

Inventories consist of the following at January 31, 2004 and 2003:

                                            January 31,           January 31
                                               2004                  2003
                                             --------              --------
     Raw materials                           $114,120              $ 57,271
     Finished goods                           208,943               244,140
                                             --------              --------
     Total                                   $323,063              $301,411
                                             ========              ========

                                      F-12
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE G - PROPERTY AND EQUIPMENT

Property and equipment consists of the following at January 31, 2004 and 2003:

                                     January 31,    January 31,
                                        2004           2003       Estimated life
                                      ---------      ---------    --------------
     Machinery and Equipment          $ 587,880      $ 530,039        7 years
     Office furniture and fixtures       25,441         23,284        5 years
     Leasehold improvements              14,180         14,180        2 years
     Vehicles                             9,279          9,279        5 years
                                      ---------      ---------
                                        636,780        576,782
     Less accumulated depreciation     (479,227)      (438,239)
                                      ---------      ---------

     Net property and equipment       $ 157,553      $ 138,543
                                      =========      =========

Depreciation  expense  for the  years  ended  January  31,  2004  and  2003  was
approximately $40,988 and $37,480, respectively.

NOTE H - RESTRICTED CASH

As  collateral  for a  $100,000  line of  credit  at KIK's  principal  financial
institution,  KIK  placed  and  pledged a  $100,000  certificate  of  deposit as
collateral.  This amount was released and returned to KIK upon the repayment and
termination of the line of credit during Fiscal 2003.

NOTE I - FUNDS HELD IN TRUST BY OFFICER

In May 2001, the Company advanced $53,400 to its President to hold in trust as a
contingency fund for the sole use of the Company in the event of a unanticipated
cash  shortfall.  The advance bears  interest at 4.0% annually and is unsecured.
The original  documentation  required repayment of the advance and accrued,  but
unpaid,  interest in May 2003. As of January 31, 2004,  with the approval of the
Company's  Board of  Directors,  the Company's  President  continues to maintain
these funds as trustee on behalf of the Company.

NOTE J - NOTES PAYABLE TO INVESTORS

Pursuant to the terms of a private placement agreement, the Company attempted to
raise up to $600,000  through the  placement of two-year  senior  notes  bearing
interest  at 10%  payable  quarterly.  This  Private  Placement  Memorandum  was
terminated by the Company during the fiscal quarter ended October 31, 2002.

In November  2001,  the Company  entered  into an agreement  with an  investment
banker whereby the investment  banker would act as exclusive  dealer-manager  in
this private  placement of  securities  to be issued by the Company  pursuant to
Regulation D of the Securities  Act of 1933, as amended.  As  compensation,  the
investment  banker was paid  $15,000 for  professional  fees and will  receive a
commission equal to 10% of the gross proceeds,  an expense allowance equal to 4%
of the gross  proceeds and, for  every  $500,000  raised,  150,000 shares of the
Company's restricted, unregistered common stock. Such shares will be issued upon
completion of the private  placement.  In addition,  the investment  banker will
have the option to nominate one person to the Company's Board of Directors if at
least  $2,000,000 is raised.  As of the  termination  of this Private  Placement
Memorandum, only $75,000 had been successfully raised.

                                      F-13
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE J - NOTES PAYABLE TO INVESTORS - CONTINUED

Note  holders can elect,  with the  consent of the  Company,  to accept  Company
common stock in lieu of cash interest payments.  Such payments in stock would be
calculated  at 50% of the daily  average of the market price of the common stock
for the 30-calendar  days preceding the interest due date. After six months from
the date of issue of the notes,  the  Company  can  convert  the notes to common
stock if the daily average  market price of the  Company's  common stock for any
30-calendar days after the initial six-month period equals or exceeds $1.00. The
conversion  of the notes to common stock would also be  calculated at 50% of the
daily average market price for the 30 days prior to the Company giving notice of
its plan to convert.

In  conjunction  with the offering of the notes,  each note holder was given one
warrant for each $1.00 invested.  Each warrant allows the holder to purchase one
share of the Company's  common stock at an initial exercise price of $per share,
and is  exercisable  for two years.  In March  2002,  the Company  repriced  the
outstanding warrants to an exercise price of $0.40 per share.

Pursuant to the private placement,  the Company sold a $50,000  convertible note
on November 12, 2001 and a $25,000  convertible note on December 26, 2001 to two
unrelated  investors.  Warrants to purchase a combined total of 75,000 shares of
the Company's common stock at $0.60 per share were also issued to the investors.
The  warrants  were  valued at $11,789  using the  Black-Scholes  option-pricing
model, and therefore $11,789 of the total debt proceeds of $75,000 was allocated
to the warrants,  resulting in a discount on the notes,  which will be amortized
to interest expense over the term of the underlying debt. During the years ended
January 31, 2004 and 2003,  approximately  $9,100 and $5,900 of the discount was
amortized to interest  expense.  The weighted  average  assumptions  utilized to
value the warrants using the Black-Scholes option-pricing model were as follows:

Expected life of the option:    The initial life of the corresponding option,
                                generally two (2) years
Expected volatility in
 the Company's stock price:     150.0%, which was based on fluctuations of the
                                Company's stock price over the past Fiscal year.
Expected dividends:             Zero (0.00) based on past performance
Anticipated risk free
 interest rate:                 Estimated to be 2.80%.

The  convertible  notes  contained a beneficial  conversion  feature valued at a
combined  total  of  approximately  $63,000.  However,  because  the  conversion
features are fully contingent upon the occurrence of certain future events,  the
Company  did not  record a discount  resulting  from the  beneficial  conversion
feature.

The aggregate maturities of the notes are as follows:

     Year ended January 31, 2004                                  $ 75,000
     Less unamortized discount                                      (4,775)
                                                                  --------

     Year ended January 31, 2003                                  $ 70,225
                                                                  ========

The Company  recognized  interest  expense related to the all outstanding  debt,
including the notes payable,  bank lines of credit and equipment  financing,  of
approximately  $14,000 and  $16,000,  for the years  ended  January 31, 2004 and
2003, respectively.

                                      F-14
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE K - CAPITAL LEASE PAYABLE

Capital lease payable is as follows:

                                                        January 31,  January 31,
                                                           2004         2003
                                                         --------     --------
$21,080 capital lease payable to a finance corporation
 Interest at 8.60%.  Payable in monthly installments
 of approximately $432, including accrued interest
 Final maturity due in April 2007.  Collateralized by
 equipment                                               $ 14,431     $ 18,203

     Less current maturities                               (4,095)      (3,738)
                                                         --------     --------

     Long-term portion                                   $ 10,336     $ 14,465
                                                         ========     ========

Future maturities of long-term capital leases payable are

                                                     Year ending
                                                      January 31,      Amount
                                                      -----------      ------
                                                         2005         $ 4,095
                                                         2006           4,468
                                                         2007           4,872
                                                         2008             996
                                                                      -------

                                                         Total        $14,431
                                                                      =======

NOTE L - INCOME TAXES

The  components of income tax (benefit)  expense for the years ended January 31,
2004 and 2003, respectively, are as follows:

                                             January 31,           January 31,
                                                2004                  2003
                                              -------               -------
      Federal:
       Current                                $    --               $    --
       Deferred                                    --                    --
                                              -------               -------
                                                   --                    --
                                              -------               -------
      State:
       Current                                     --                    --
       Deferred                                    --                    --
                                              -------               -------
                                                   --                    --
                                              -------               -------

       Total                                  $    --               $    --
                                              =======               =======

The Company has a net operating loss carryforward of approximately $4,600,000 to
offset future taxable income. Subject to current regulations,  this carryforward
will begin to expire in 2005. The amount and  availability  of the net operating
loss  carryforwards  may be subject  to  limitations  set forth by the  Internal
Revenue Code.  Factors such as the number of shares  ultimately  issued within a
three year  look-back  period;  whether  there is a deemed  more than 50 percent
change in control; the applicable long-term tax exempt bond rate;  continuity of
historical  business;  and  subsequent  income of the Company all enter into the
annual computation of allowable annual utilization of the carryforwards.

                                      F-15
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE L - INCOME TAXES - CONTINUED

The Company's  income tax expense for the years ended January 31, 2004 and 2003,
respectively, are as follows:

                                                     January 31,     January 31,
                                                        2004            2003
                                                      --------        --------

Statutory rate applied to loss before income taxes    $(68,000)       $ (4,300)
Increase (decrease) in income taxes resulting from:
 State income taxes                                         --              --
 Other, including reserve for deferred tax asset        68,000           4,300
                                                      --------        --------

    Income tax expense                                $     --        $     --
                                                      ========        ========

Temporary differences, consisting primarily of net operating loss carryforwards,
statutory  deferrals  of expenses  for  organizational  costs and  accrued,  but
unpaid,  accruals for officer  compensation  and  statutory  differences  in the
depreciable  lives for property and equipment,  between the financial  statement
carrying  amounts and tax bases of assets and liabilities  give rise to deferred
tax assets and liabilities as of January 31, 2004 and 2003, respectively:

                                               January 31,          January 31,
                                                  2004                 2003
                                               -----------          -----------
Deferred tax assets
  Net operating loss carryforwards             $ 1,564,000          $ 1,496,000
  Less valuation allowance                      (1,564,000)          (1,496,000)
                                               -----------          -----------

Net Deferred Tax Asset                         $        --          $        --
                                               ===========          ===========

During the Fiscal  years  ended  January 31,  2004 and 2003,  respectively,  the
valuation  allowance  for  the  deferred  tax  asset  increased  (decreased)  by
approximately $68,000 and $(204,000).

NOTE M - COMMON STOCK TRANSACTIONS

Effective at the end of each Fiscal  quarter  during the year ended  January 31,
2003,  the Company and the holders of the two  convertible  notes agreed for the
payment of accrued  interest  in  restricted,  unregistered  common  stock.  The
Company issued an aggregate  101,964 shares of restricted,  unregistered  common
stock in payment of  accrued  interest.  These  transactions  were  valued at an
aggregate approximately $6,977. The convertible note terms allow for the payment
of accrued interest with restricted,  unregistered common stock using an average
value of 50% of the daily  average of the market  price of the common  stock for
the 30 calendar  days  preceding the interest due date.  In two  instances,  the
closing stock price,  as discounted  was at or in excess of the closing price on
the settlement date. In two instances, the closing stock price on the settlement
date was in excess of the prescribed  calculation.  The differential between the
discounted  "fair  value"  and the  settlement  price  resulted  in a charge  to
operations of  approximately  $906 for  compensation  expense  related to common
stock issuances at less than "fair value".  The Company relied upon Section 4(2)
of The Securities Act of 1933, as amended, for an exemption from registration on
these shares.


                (Remainder of this page left blank intentionally)

                                      F-16
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE M - COMMON STOCK TRANSACTIONS - CONTINUED

Effective  February 1, 2003 and May 1, 2003,  the Company and the holders of the
two convertible  notes agreed for the payment of accrued interest in restricted,
unregistered  common stock.  The Company  issued an aggregate  206,987 shares of
restricted,  unregistered  common  stock in payment of accrued  interest.  These
transactions were valued at an aggregate  approximately  $3,782. The convertible
note  terms  allow  for  the  payment  of  accrued   interest  with  restricted,
unregistered  common stock using an average value of 50% of the daily average of
the market  price of the common  stock for the 30 calendar  days  preceding  the
interest due date. In both instances,  the closing stock price on the settlement
date was in excess of the prescribed  calculation.  The differential between the
discounted  "fair  value"  and the  settlement  price  resulted  in a charge  to
operations of  approximately  $945 for  compensation  expense  related to common
stock issuances at less than "fair value".  The Company relied upon Section 4(2)
of The Securities Act of 1933, as amended, for an exemption from registration on
these shares.

In February 2003, the Company issued 150,000 restricted,  unregistered shares of
common stock in payment of a contract for marketing  services.  This transaction
was  valued  at  approximately  $3,000,  which  was equal to or in excess of the
discounted  closing price of the Company's common stock on the NASDAQ Electronic
Bulletin Board on the date of each  respective  transaction.  The Company relied
upon Section 4(2) of The  Securities  Act of 1933, as amended,  for an exemption
from registration on these shares.

In April 2003,  the Company  issued 22,500  restricted,  unregistered  shares of
common stock in settlement  of a January 31, 2003 trade  account  payable in the
amount of  approximately  $552. The value of this transaction was equal to or in
excess of the  discounted  closing  price of the  Company's  common stock on the
NASDAQ Electronic Bulletin Board on the date of each respective transaction. The
Company relied upon Section 4(2) of The Securities Act of 1933, as amended,  for
an exemption from registration on these shares.

In May 2003,  the Company  issued  575,664  restricted,  unregistered  shares of
common stock in payment of trade accounts payable to the Company's primary legal
counsel in the amount of  approximately  $72,849.  The value of this transaction
was equal to or in  excess  of the  discounted  closing  price of the  Company's
common  stock  on the  NASDAQ  Electronic  Bulletin  Board  on the  date of each
respective  transaction.  The Company relied upon Section 4(2) of The Securities
Act of 1933, as amended, for an exemption from registration on these shares.

NOTE N - STOCK WARRANTS

At  January  31,  2004,  the  75,000  warrants  sold  in  conjunction  with  the
convertible notes private placement had expired.

In conjunction  with the reverse  acquisition,  which was concluded in September
2001, The Company granted  2,300,000  warrants to certain  shareholders of KTTI.
These  warrants  have an  exercise  price of  approximately  $0.05 per share and
expire in April 2004.

The  following  table  lists the issued and  outstanding  stock  warrants  as of
January 31, 2004 and 2003, respectively:

                                                   Warrants
                                   Warrants      outstanding at
                                  originally      January 31,
                                    issued           2004         Exercise price
                                   ---------       ---------      --------------
Balance at January 31, 2002        2,375,000       2,375,000
  Granted                                 --              --
  Exercised                               --              --
  Forfeited/Expired                       --              --
                                   ---------       ---------

Balance at January 31, 2003        2,375,000       2,375,000
                                   =========       =========

                                      F-17
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE N - STOCK WARRANTS - CONTINUED

<TABLE>
<CAPTION>
                                                                 Warrants
                                                Warrants       outstanding at
                                               originally       January 31,
                                                 issued            2004         Exercise price
                                                ---------        ---------      --------------
<S>                                               <C>              <C>         <C>
Balance at January 31, 2003                     2,375,000        2,375,000
  Granted                                              --               --
  Exercised                                            --               --
  Forfeited/Expired
  Convertible note/warrants                       (75,000)         (75,000)           $0.40
                                               ----------       ----------

Balance at January 31, 2004                     2,300,000        2,300,000
                                               ==========       ==========

Warrants exercisable January 31, 2004           2,300,000
                                               ==========

Weighted-average exercise price per warrant    $     0.05
                                               ==========
</TABLE>

NOTE O - RELATED PARTY TRANSACTIONS

During the year ended  January  31,  2004,  the  Company  accrued  approximately
$120,000 in administrative service fees payable to KTTI.

NOTE P - COMMITMENTS AND CONTINGENCIES

LEASED FACILITIES

The Company leases its facilities under a non-cancellable operating lease, which
expires in May 2005. The lease requires monthly payments as follows:  $8,307 for
the first 12  months;  $8,639  for the next 12 months and $8,984 for the next 12
months.  Rent expense incurred under this lease was  approximately  $102,340 and
$97,800 for each of the years ended January 31, 2004 and 2003, respectively.

Future amounts due under this agreement are as follows:

                                      Year ending
                                      January 31,                    Amount
                                      -----------                    ------
                                         2005                       $106,428
                                         2006                         35,936
                                                                    --------

                                         Total                      $142,364
                                                                    ========

EMPLOYMENT CONTRACT

In  May  2000,  KIK  entered  into  an  employment  agreement  with  William  M.
Knooihuizen,  the Company's  current  President  and  Director.  The term of the
agreement is for a period of five (5) years.  For such  services,  KIK agreed to
pay Mr.  Knooihuizen  an annual  salary in the  amount of  $143,000,  to be paid
weekly.

                                      F-18
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE Q - SIGNIFICANT CUSTOMERS

During the year ended January 31, 2004,  the Company had two separate  customers
responsible  for  an  aggregate  of  approximately  78.47%  (69.06%  and  9.41%,
respectively) of total sales. The largest customer is also a significant  vendor
of raw materials.  The largest key customer was  responsible  for  approximately
48.95% of  accounts  receivable  and 76.17% of  accounts  payable at January 31,
2004.  The  second key  customer  was  responsible  for  approximately  1.72% of
accounts  receivable  and 0.00% of accounts  payable at January 31, 2004.  There
were no other  customer(s)  responsible  for more than  10.0% of total net sales
during Fiscal 2004.

During the year ended January 31, 2003,  the Company had two separate  customers
responsible  for  an  aggregate  of   approximately   80.3%  (68.2%  and  12.1%,
respectively) of total sales. The largest customer is also a significant  vendor
of raw materials.  The largest key customer was  responsible  for  approximately
57.2% of accounts  receivable and 0.0% of accounts  payable at January 31, 2003.
The second key  customer was  responsible  for  approximately  9.02% of accounts
receivable and 0.0% of accounts payable at January 31, 2003. There were no other
customer responsible for more than 10.0% of total net sales during Fiscal 2003.


NOTE R - SELECTED FINANCIAL DATA (UNAUDITED)

The following is a summary of the quarterly  results of operations for the years
ended January 31, 2004 and 2003, respectively.

<TABLE>
<CAPTION>
                              Quarter ended     Quarter ended    Quarter ended    Quarter ended      Year ended
                                April 30,          July 31,        October 31,      January 31,      January 31,
                                ---------          --------        -----------      -----------      -----------
<S>                           <C>               <C>               <C>               <C>              <C>
FISCAL 2004
  Sales                       $   792,156       $   929,571       $   990,843       $   926,719      $ 3,639,289
  Gross profit                    122,215           137,817           116,462           145,738          522,232
  Net earnings after
   provision for
   income taxes                   (61,636)          (40,059)          (49,959)          (47,483)        (199,137)
  Basic and fully diluted
   earnings per share                 nil               nil               nil               nil      $     (0.01)
  Weighted average
   number of shares
   issued and outstanding      24,311,934        24,990,579        25,021,865        25,021,865       24,840,873

FISCAL 2003
  Sales                       $   849,370       $   779,391       $   862,039       $   664,741      $ 3,155,541
  Gross profit                    130,084           159,506           132,110           134,042          555,742
  Net earnings after
   provision for
   income taxes                   (23,779)            8,816           (20,733)           23,007      $   (12,689)
  Basic and fully diluted
   earnings per share                 nil               nil               nil               nil              nil
  Weighted average
   number of shares
   issued and outstanding      23,985,000        24,000,606        24,028,950        24,087,471       24,035,930
</TABLE>

                                      F-19
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE S - SUBSEQUENT EVENTS

On February 16, 2004, the Company  restructured  the $50,000  convertible  note.
Under the restructured terms, the Company paid all accrued interest and a $3,000
principal reduction on March 16, 2004.  Thereafter,  the Company is obligated to
pay $2,000 per month, plus accrued interest,  for the next six months and $1,000
per month, plus accrued interest,  thereafter until all outstanding  amounts are
paid in full. The restructured note bears interest at 10.0% per annum.

The restructured  note is convertible  into shares of  unregistered,  restricted
common  stock at the sole  discretion  of the  Company  provided  that the daily
average  (calculated  from the last sale price daily) of the market price of the
Company's  common stock for any 30 calendar day period  equals or exceeds  $1.00
per share, with the conversion being calculated at a 50% discount of such 30 day
average.

The Noteholder also has the election to receive the monthly interest payments in
restricted,  unregistered  common  stock of the  Company  at the  daily  average
(calculated  from the last sale price daily) of the market price of the C common
stock for the 30 calendar day period  prior to the  interest due date,  with the
number  of  shares  to be issued  calculated  at a 50%  discount  of such 30 day
average.

Through March 31, 2004, the Company has paid  approximately  $5,000 in principal
and $4,100 in cumulative accrued interest.

                                      F-20