U. S. Securities and Exchange Commission
                     Washington, D. C.  20549

                           FORM 10-KSB

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

     For the fiscal year ended December 31, 2002

[ ]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934

     For the transition period from _____________ to ____________

                  Commission File No. 333-46114

                         KUBLA KHAN INC.
           ____________________________________________
          (Name of Small Business Issuer in its Charter)


      Utah                                           87-0650976
______________________________              ________________________
(State or Other Jurisdiction of            (I.R.S. Employer I.D. No.)
 Incorporation or Organization)


     6990 So. Park Centre Drive, Suite 315,   Salt Lake City, Utah 84121
___________________________________________________________________
             (Address of Principal Executive Offices)


                                         (801) 567-0111, Ext.6315
      Issuer's Telephone Number: __________________________

                               N/A
   ___________________________________________________________
  (Former Name or Former Address, if changed since last Report)


Securities Registered under Section 12(b) of the Exchange Act:    NONE
Name of Each Exchange on Which Registered:                        NONE

Securities Registered under Section 12(g) of the Exchange Act:

                               NONE
                          ______________
                         (Title of Class)

Check whether the Issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that  was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.

     Yes [X]    No [ ]

<PAGE>

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 registrant'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.  [X]


State Issuer's revenues for its most recent fiscal year:

                    December 31, 2002 - $1,329
                _________________________________

State the aggregate market value of the voting stock held by non-affiliates
computed by reference to the price at which the stock was sold, or the average
bid and asked prices of such stock, as of a specified date within the past 60
days.

As of date of this report the market value of the common voting stock held by
non-affiliates was $75,000. The market price is calculated based upon 75,000
shares of common voting stock held by non-affiliates multiplied by the price
at which the common equity was sold, or $1.00.  During the past two years
there has been no "established public market" for shares of common voting
stock of the registrant.

     ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS

     Not Applicable.

     State the number of shares outstanding of each of the Issuer's classes of
common equity, as of the latest practicable date: As of March 21, 2003 there
were 111,744 shares of the issuer's common stock issued and outstanding.

     DOCUMENTS INCORPORATED BY REFERENCE

     Not Applicable.

Transitional Small Business Disclosure Format   Yes [ ] No [ X ]

                                2
<PAGE>


                        TABLE OF CONTENTS

                              PART I

Item 1.      Description of business ......................................4
Item 2.      Description of property ......................................6
Item 3.      Legal proceedings ............................................6
Item 4.      Submission of matters to a vote of security holders ..........6


                             PART II

Item 5.      Market for common equity and related stockholder matters .....7
Item 6.      Management's discussion and analysis; plan of operation.......9
Item 7.      Financial statements ........................................10
Item 8.      Changes in and disagreements with accountants on
             accounting and financial disclosure..........................18

                             PART III

Item 9.      Directors and executive officers; Compliance with
             Section 16(a)................................................18
Item 10.     Executive compensation.......................................20
Item 11.     Security ownership of certain beneficial owners
             and management...............................................21
Item 12.     Certain relationships and related transactions...............22
Item 13.     Exhibits and reports on Form 8-K.............................23
Item 14      Controls and Procedures......................................23
             Signatures...................................................24
             Certifications...............................................25

                                3

<PAGE>
                              PART I

ITEM 1.  DESCRIPTION OF BUSINESS.

Business Development
--------------------

     Kubla Khan, Inc. incorporated under the laws of the State of Utah on
March 28, 2000 for the purpose of acquiring products from manufacturers
(factory overruns) and retailers (overstocks) and marketing the lower priced
merchandise to retailers, wholesalers, and the general public.   Pursuant to
an SB-2 Registration filed with the United States Securities & Exchange
Commission and declared effective March 28, 2001, 75,000 shares of our common
stock were sold to residents of the State of Utah at a price of $1.00 per
share.  The closing date of this offering was May 4, 2001 at which time there
were 111,744 shares outstanding.

     We are a development stage company with limited operations and revenues.

Business.
--------

     Principal Products or Services and their Markets
     ------------------------------------------------

     We were established for the purpose of acquiring products from
manufacturers (factory overruns and closeouts) and retailers (overstocks) and
marketing this merchandise to retailers, wholesalers, and the general public.
Since this type of "distress" merchandise is available to us at a fraction of
existing wholesale prices for similar products,  we can sell the products at a
substantial discount below wholesale prices for similar products. To date we
have dealt primarily in wearing apparel.

     Distribution Methods of the Products or Services
     ------------------------------------------------

     In view of the fact that our funds are severely limited, we have made the
decision to purchase inventory items only if and when we have a customer
commitment to purchase those items.  Essentially, when we have received a
customer commitment for inventory items that we have located from suppliers,
we will order the items, have them delivered to our office, and, upon receipt
of the items, we will remit payment to the supplier(s).  We will then
repackage the order so we can keep the name of our supplier confidential and
then personally deliver (if local) or ship the order.  Although there are
risks involved, we are open to consignment arrangements for financially sound
customers.

     Status of any Publicly Announced New Product or Service
     -------------------------------------------------------

     There have been no publicly announced new products or services and none
are currently planned.

     Competition
     -----------

     The market for discounted wholesale and retail merchandise is highly
competitive and involves a high degree of risk and there is no assurance that
we will ever be able to operate profitably. We are competing with larger, more
experienced, and better-funded companies which have already developed
relationships with manufacturers and wholesalers as well as potential end-
users. Due to our lack of experience in the industry and minimal funding, it
has been difficult for us to develop relationships with wholesalers and
manufacturers as well as develop a market niche for any closeout goods we may

                                4

<PAGE>

purchase. We are competing with other "jobbers" in the purchase of distressed
or overstocked merchandise at discounted prices. We are also competing with
some of the wholesalers and manufacturers themselves who have established
direct relationships with end-users. It is extremely difficult for us to
compete, which makes it difficult to achieve profits. We believe that we will
be able to compete successfully only if we succeed in purchasing inventory at
30%-50% off of normal wholesale costs and are able to successfully establish
relationships with retailers and end-users. In the retail segment of our
business, which has been non existent to this point, we will experience
substantial competition with other entities such as Big Lots, All-a-Dollar and
discount houses in the sale and marketing of merchandise all of which have
greater name recognition and experience. We will not be able to directly
compete with such entities but will either (a) sell our inventory to them; or
(b) direct retail sales efforts through flea markets, swap meets and expo
marts.

     Sources and Availability of Products
     ------------------------------------

     The closeout, overrun and overstock industry is extremely unique since
the availability of merchandise to us at very attractive prices has a short
time window of opportunity. We are frequently shown such merchandise
availability. However, those products are quickly sold to companies such as
ours and are typically available only in large volume purchase requirements.
In view of the fact that our financial resources are extremely limited, we are
not in a position to "speculate" on such merchandise and thus we must decline
some potentially profitable opportunities.

     Dependence on One or a Few Major Customers
     ------------------------------------------

     To date we have been able to establish only two customers.  Despite our
efforts to generate sales to other retailers, we have not to date been able to
locate specific merchandise that is on the "want list" of retailers other than
those two.

     Patents, Trademarks, Licenses, Franchises,
     Concessions, Royalty Agreements or Labor Contracts
     --------------------------------------------------

     There are no patents, trademarks, licenses, franchises, concessions,
royalty agreements or labor contracts that have any direct or indirect effect
on our business.

     Governmental Approval of Principal Products or Services
     -------------------------------------------------------

     No governmental approval of any of the products that we deal in or intend
to deal in is required.

     Effects of Existing or Probable Governmental Regulations
     ---------------------------------------------------------

     Other than maintaining our good standing, complying with applicable local
business licensing requirements, preparing our periodic reports under the
Securities Exchange Act of 1934, as amended (the "1934 Act"), and complying
with other applicable securities laws, rules and regulations as set forth
above, we do not believe that existing or probable governmental regulations
will have a material effect on our operations.

                                5
<PAGE>

     Cost and Effect of Compliance with Environmental Laws
     ------------------------------------------------------

     There are no environmental laws that materially impact our business.

     Research and Development Expenses
     ---------------------------------

     We have not incurred any research and development expenses in the past,
and we do not expect to incur any in the foreseeable future.

     Number of Employees
     -------------------

     We presently have no employees and no independent contractors. Our day to
day operations are overseen by two of our officers: Bill Roberts and Kristine
Ramsey.

     Possible Change of Business Direction
     -------------------------------------

     Although we intend to continue to vigorously pursue our business plan, if
our current business operations continue to result in losses, we will look at
several different alternatives including examining the possibility of
acquiring an interest in a different business opportunity.  Such acquisition
of a business opportunity could be made by merger, exchange of stock, or
otherwise.  We have no source of capital, however, and, at the present time,
we intend to continue to pursue our initial business purpose as described
above and have not identified any other business opportunity that we plan to
pursue. We do, however, remain open to other options and, should an
opportunity present itself,  we would likely investigate it thoroughly and
proceed in a manner which we believe is in the best interests of our
shareholders.


ITEM 2.  DESCRIPTION OF PROPERTY

       We maintain our executive offices of approximately 300 square feet in
the residence of William S. Roberts. The annualized rent is $6,000. We believe
that our facility is suitable as our executive offices and we have no present
intentions to renovate or improve our facility or seek new facilities. Our
facility is adequately covered by insurance.

ITEM 3.  LEGAL PROCEEDINGS.

      We are not a party to any pending legal proceeding.  Our property is not
subject to any pending legal proceeding.  To the best of our knowledge, no
federal, state or local governmental agency is presently contemplating any
proceeding against us.  No director, executive officer or affiliate of Kubla
Khan, Inc. or owner of record or beneficially of more than 5 percent of our
common stock is a party adverse to us or has a material interest adverse to us
in any proceeding.

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

     No matter was submitted to a vote of security holders, through the
solicitation of proxies or otherwise, during the fourth quarter of the fiscal
year covered by this report.


                                6
<PAGE>
                             PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

General
-------

     Our authorized capital stock consists of 50,000,000 shares of common
stock, par value $0.001 per share. As of December 31, 2002, we had 111,744
shares of common stock issued and outstanding.

Common Stock
------------

     The holders of the common stock are entitled to cast one vote for each
share held of record on all matters presented to stockholders. The holders of
common stock do not have cumulative voting rights, which means that the
holders of more than 50% of the outstanding shares voting for the election of
our directors can elect all of the directors, and in such an event, the
holders of the remaining shares will be unable to elect any of our directors.
Our certificate of incorporation does not provide that the holders of common
stock have any preemptive rights.

Market Information
------------------

     As of December 31, 2002 there was no market for our common shares. On
March 6, 2002, our common stock was accepted for quotation on the OTC Bulletin
Board and was assigned the trading symbol KUKH. On March 20, 2002 the initial
transaction on the OTCBB was 3,100 shares of our common stock at $1.125 per
share which was the only transaction in our common stock to date. At March 21,
2003 there was no posted bid or offer on our common stock. Based on this
information, management does not believe that an established market exists for
our common stock.

Holders
-------

     The number of record holders of our common stock as of the date of this
report is 100.

Dividends
---------

     We have not declared any cash dividends with respect to our common stock
and we do not intend to declare dividends in the foreseeable future. There are
no material restrictions limiting, or that are likely to limit, our ability to
pay dividends on its securities, except for any applicable requirements under
Utah corporate law.

Recent Sales of Unregistered Securities
---------------------------------------

     During the period covered by this report, there were no securities issued
which were not registered under the Securities Act or previously
reported in another report.

Use of Proceeds from Offering Closed on May 4, 2001
---------------------------------------------------

      The following information is provided in accordance with Rule 701(f)
regarding Use of Proceeds of a registration under Form SB-2 which closed on
May 4, 2001:

                                7
<PAGE>

      On March 28, 2001, our registration statement filed on Form SB-2 was
declared effective.  The Securities and Exchange Commission file number
assigned to the registration statement is 333-46114.  Pursuant to our
registration statement, we registered a maximum of 75,000 shares of our common
stock for sale to the public through our President, William S. Roberts, in a
self-underwritten offering. No selling shareholders participated in the
offering which commenced on March 29, 2001, and closed on May 4, 2001 with
maximum proceeds.  The offering price was $1.00 per share.

     Between March 29, 2001 (commencement of offering) and December 31, 2001
we incurred approximately $10,517 in expenses in connection with the issuance
and distribution of securities in the offering for the following items:

     .    underwriting discounts and commissions................ -0-
     .    finders' fees......................................... -0-
     .    expenses paid to or for underwriters.................. -0-
     .    other expenses: prepaid offering expenses
          including legal, accounting and EDGAR fees............$ 9,283
     .    other offering expenses (not prepaid).................$ 1,234
                                                                -------
                                 TOTAL OFFERING EXPENSES........$10,517
                                                                =======

     All of these expenses were incurred to parties other than:

     .   our directors, officers, or general partners or their associates;
     .   persons owning 10% or more of any class of our equity securities; or
     .   our affiliates

     The net offering proceeds to us after deducting expenses of the offering
were $64,483.  As of December 31, 2002,  we had used the actual net offering
proceeds in the following manner:

     .  Merchandise Inventory.......................$ 9,830
     .  Storage Unit................................$ 1,777
     .  Rent(1).....................................$10,000
     .  Working Capital (including travel)(2).......$21,749
     .  Salaries(3).................................$10,396
     .  Office equipment............................$ 1,593
                                                    -------

     TOTAL NET PROCEEDS EXPENDED at Dec. 31,2002....$55,345 (4)
                                                   ========

     (1)  Paid to Mr. William Roberts as agreed upon at a rate of $500 per
          month for use of his home as our office

     (2)  Most of these expenses were incurred by management in their efforts
          to locate suppliers and acquire inventory

     (3)  Paid to Mr. Roberts and Kristine Ramsey for services performed
          at a rate of $15.00 per hour; we will pay no more salaries from
          offering proceeds; additional compensation to officers/directors
          will be paid from revenues from operations, if any.

     (4)  The balance of the proceeds remains on deposit in our bank account.


                                8
<PAGE>

     Except those expenses footnoted above, all other expenses were incurred
to parties other than:

     .   our directors, officers, or general partners or their associates;
     .   persons owing 10% or more of any class of our equity securities; or
     .   our affiliates

     Management believes that those expenses paid to or incurred by Mr.
Roberts/Ms. Ramsey are equal to or less than if the same were incurred or paid
to a non-related party.

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Forward-looking Information
---------------------------

     This report on Form 10-KSB contains certain "forward-looking statements"
within the meaning of Section 21E of the Securities Exchange Act of 1934.
Generally, the words "anticipates," "expects," "believes," "intends," "could,"
"may," and similar expressions identify forward-looking statements. Forward-
looking statements involve risks and uncertainties. We caution you that while
we believe any forward-looking statements are reasonable and made in good
faith, expectations almost always vary from actual results, and the
differences between our expectations and actual results may be significant.
The following discussion and analysis of our results of operations and our
financial condition should be read in conjunction with the information set
forth in the audited financial statements for the year ended December 31,
2002.

Uncertainties affecting our business
------------------------------------

     There is no assurance that we will ever be successful in our current
business of acquiring factory overruns or overstock merchandise for resale at
discount prices.  Our lack of operating history as well as inexperience of
management makes it difficult to evaluate the potential of a start-up company
such as ours.  We do not know whether we will ever be able to operate
profitably in the business we have chosen to develop. So far we have had
difficulty locating financially sound customers to sell merchandise to.  Since
September 11, 2001, the economy has shown signs of a downturn.  World events
have also contributed to an uncertain economy which has been both good and bad
for us.  Although we are seeing a more plentiful supply of closeout, overstock
and overrun merchandise, retailers have been extremely cautious about ordering
inventory due to softened public demand.  During our last fiscal year, any
potential benefits of an increase in available overstock merchandise have been
far outweighed by our inability to attract retailers to our products. We
presently have inventory acquired at very favorable costs but it has been hard
to convince retailers to purchase this inventory for resale. Our inability to
establish a strong customer base has dictated our decision to purchase
inventory primarily only if it is pre-sold.  Two main factors make this very
difficult.  First of all, when closeout merchandise is made available to us,
it is generally gone within a day or two which is not enough time for us to
pre-sell those items to retailers.  The majority of retailers we have been in
touch with do not make snap judgements in their purchasing process and
typically take days or even weeks to make a decision.

     The other factor making success in this industry difficult to achieve is
the fact that our decisions are made by a management team that has had no
prior experience in the industry. We have realized losses in our second year
of operations of $21,189 and with our limited financial resources we

                                9
<PAGE>

anticipate that we could possibly be out of liquid resources by year end
unless we look at other alternatives.  If management is made aware of any
opportunities that we feel should be adopted, we will notify our shareholders
and present any such proposal to our shareholders for their approval. In
short, at this point in time management has less than an optimistic outlook in
regards to our near term results.

Results of Operations
---------------------

     We have realized minimal gross revenues during 2002 of $1,329.  Cost of
goods associated with those revenues was $1,019 or 77%.  Although our
percentage of profit on the goods sold is encouraging, we have not achieved
sufficient volume to make our revenues significant, nor have we experienced
sufficient cash flows from operations to make a determination as to whether we
can expect the same revenues in the future.  During that same year our general
and administrative expenses were $13,472, and, as a result, we have operated
at a loss, and will continue to operate at a loss unless we see a significant
increase in volume of our sales. We believe it will be difficult to increase
our sales volume sufficiently to achieve a profit in the coming year. Although
better than average prices on wholesale goods are available to us, we do not
have sufficient cash flows to take advantage of these lower prices.  Our lack
of cash flows has dictated that we make inventory purchases based on pre-
sales, which is difficult to achieve in a cautious economy.  At the end of our
fiscal year 2002, we had $20,068 in assets comprising nearly $10,000 in
inventory, as well as just over $9,000 in cash.

Plan of Operation
-----------------

     Our plan of operation for the next 12 months is to vigorously pursue
sources of bargain-priced closeout, overstock and overrun merchandise and
retail outlets seeking such merchandise. We will minimize acquiring inventory
on "speculation" and will focus primarily on matching buyers with what sellers
have to offer. In this way we will focus on conserving our financial
resources. We will also investigate other business opportunities if they
become known to us and remain open to a change of business direction.

     During the next 12 months, our only foreseeable cash requirements will
relate to overhead items. We have approximately $9,000 in cash available to us
for our next fiscal year.  We can expect minimum day to day operating expenses
during the next year of approximately $8,500 including rent of $6,000,
$1,200 in telephone expenses, and storage expenses of $1,236; in addition, we
will require approximately $3,000 for legal and accounting necessary to
maintain compliance with our reporting obligations under the Exchange Act.
Accordingly, we believe the funds available to us will not be sufficient to
conduct operations as well as pursue our business purpose for the coming year
unless we realize sufficient net profits or unless we receive a sufficient
infusion of debt or equity financing (of which there is no assurance).

ITEM 7.  FINANCIAL STATEMENTS.

     Our audited financial statements for December 31, 2002 begin on the next
page.


                                10
<PAGE>


                     Randy Simpson CPA, P.C.
                    11775 South Nicklaus Road
                        Sandy, Utah 84092
                    Fax & Phone (801) 572-3009


Board of Directors and Stockholders
Kubla Khan, Inc.
(A Development Stage Company)
Salt Lake City, UT

                   INDEPENDENT AUDITORS' REPORT

We have audited the accompanying balance sheet of Kubla Khan, Inc. (a
development stage company) as of December 31, 2002 and the related statements
of operations, shareholder's equity and cash flows for the year ended December
31, 2002 and the periods from inception (March 28, 2000) through December 31,
2001 and December 31, 2002. These financial statements are the responsibility
of the Company's management.  Our responsibility is to express an opinion on
these financial statements based on our audit.

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

In our opinion, based on our audit, the financial statements referred to above
present fairly, in all material respects, the financial position of Kubla
Khan, Inc, as of December 31, 2002 and the results of its operations,
shareholder's equity and cash flows for the year ended December 31, 2002 and
the periods from inception (March 28, 2000) through December 31, 2001 and
December 31, 2002, in conformity with generally accepted accounting
principles.


/s/ Randy Simpson CPA PC

Randy Simpson, CPA, P.C.
A Professional Corporation
March 29, 2003
Sandy, Utah


                                11
<PAGE>
                         Kubla Khan, Inc.
                  (A Development Stage Company)
                          BALANCE SHEET



                                                               December 31,
                                                                   2002
                                                              -------------
                              ASSETS

Current Assets
  Cash                                                        $      9,138
  Accounts Receivable                                                    -
  Inventory                                                          9,830
  Deposits                                                              10
  Prepaid Expenses                                                     500
                                                              -------------

    Total current assets                                            19,478

Property & Equipment- Net of Depreciation of $1003                     590
                                                              -------------
    Total Assets                                              $     20,068
                                                              =============




               LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
  Accounts payable                                            $        199
                                                              -------------
    Total current liabilities                                          199

Stockholders' equity:
  Common Stock, $.001 par value, authorized 50,000,000
    shares; 111,744  shares issued and outstanding                     112
  Paid in Capital                                                   75,814
  Accumulated deficit                                              (56,057)
                                                              -------------
    Total Stockholders' Equity                                      19,869
                                                              -------------

    TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                $     20,068
                                                              -------------








         See accompanying notes to financial statements.



                                12
<PAGE>


                         Kubla Khan, Inc.
                  (A Development Stage Company)
                     STATEMENTS OF OPERATIONS



                                                                  Period from
                                                                  Inception
                                         Year          Year       (March 28,
                                         Ended         Ended      2000) to
                                      December 31,  December 31,  December 31,
                                          2002         2001       2002
                                     ------------- ------------- -------------

Sales                                $      1,329  $      5,086  $      6,415

Cost of Sales                               1,019         3,890         4,909
                                     ------------- ------------- -------------

Gross Profit                                  310         1,196         1,506

Costs and Expenses:
  General administrative                   13,472        21,967        38,299
  Travel expenses                           4,660         6,796        12,406
  Professional fees                         3,367         2,491         5,858
  Organizational expenses                       -             -         1,000
                                     ------------- ------------- -------------
      Total expenses                       21,499        31,254        57,563

      Net loss                            (21,189)      (30,058)      (56,057)

Income Tax Provision:
  Income Tax Benefit -
    loss carryforward                      (4,000)       (5,000)       (9,000)
  Income tax benefit - reversal -
    allowance for carryforward              4,000         5,000         9,000
                                     ------------- ------------- -------------
      Total income tax expense
       (benefit)                                -             -             -
                                     ------------- ------------- -------------

Net loss                             $    (21,189) $    (30,058) $    (56,057)
                                     ============= ============= =============
Net loss per share
(Basic and Fully Diluted)            $      (0.19) $      (0.35)
                                     ============= =============
Weighted Average Shares
 Common Stock Outstanding                 111,744        86,265
                                     ============= =============








         See accompanying notes to financial statements.

                                13
<PAGE>
<TABLE>
<CAPTION>

                               Kubla Khan, Inc.
                        (A Development Stage Company)
                      STATEMENTS OF STOCKHOLDERS' EQUITY
           For the Period from Inception (March 28, 2000) through
                         Year Ended December 31, 2002

                                         Common      Additional                Total
                                       Stock $.001   Paid in    Accumulated  Shareholders'
                            Shares      Par Value    Capital      Deficit      Equity
                          ----------- ------------ ------------ ------------ ------------

                       <c>         <c>          <c>          <c>          <c>
Beginning Balance                  -  $         -  $         -  $         -  $         -

Issuance of 36,744 shares
 of common stock for
 $7,500 cash                  36,744           37        7,463            -        7,500

Capital contribution
 of services of $1,980
 and facilities of $750            -            -        2,730            -        2,730

Net loss for the period
 from inception -
 (March 28, 2000) to
 December 31, 2000                 -            -            -       (4,810)      (4,810)

Capital contribution
 of services of $660
 and facilities of $553            -            -        1,213            -        1,213

Issuance of 75,000 shares
 of common stock for
 $75,000 cash, net of
 offering costs of $10,517    75,000           75       64,408            -       64,483

Net loss for the year
 ended December 31, 2001           -            -            -      (30,058)     (30,058)

Net loss for the year
 ended December 31, 2002           -            -            -      (21,189)     (21,189)
                          ----------- ------------ ------------ ------------ ------------
Balances -
   December 31, 2002         111,744  $       112  $    75,814  $   (56,057) $    19,869
                          =========== ============ ============ ============ ============














               See accompanying notes to financial statements.



                                      14


</TABLE>
<PAGE>
<TABLE>
<CAPTION>

                               Kubla Khan, Inc.
                        (A Development Stage Company)
                           STATEMENTS OF CASH FLOWS


                                                                           Period from
                                                                            Inception
                                                   Year         Year       (March 28,
                                                   Ended        Ended        2000) to
                                                December 31,  December 31,  December 31,
                                                    2002         2001          2002
                                               ------------- ------------- -------------

                                            <c>           <c>           <c>
Cash Flows provided by Operating Activities:
  Net loss                                     $    (21,189) $    (34,868) $    (56,057)
  Non-cash expenses:
   Capital contribution of services and
     facilities by stockholder                            -         3,943         3,943
   Depreciation                                         649           354         1,003
                                               ------------- ------------- -------------
   Net cash provided by operating activities        (20,540)      (30,571)      (51,111)


Changes in operating assets and liabilities:
  Increase in accounts receivable                     2,050        (2,050)            -
  Increase in inventory                               1,071       (10,901)       (9,830)
  Increase in deposits                                    -           (10)          (10)
  Decrease in prepaid expenses                         (500)            -          (500)
  Increase (decrease) in accounts payable               (44)          243           199
                                               ------------- ------------- -------------
  Net cash used by operations                       (17,963)      (43,289)      (61,252)


Cash Flows used in Investing Activities:
  Purchase of office equipment                            -        (1,593)       (1,593)
                                               ------------- ------------- -------------
  Net cash used in investing activities                   -        (1,593)       (1,593)


Cash Flows from Financing Activities:
  Issuance of common stock for cash                       -        82,500        82,500
  Offering costs charged to capital                       -       (10,517)      (10,517)
                                               ------------- ------------- -------------
  Net cash  from  financing activities                    -        71,983        71,983
                                               ------------- ------------- -------------

Net increase in cash                                (17,963)       28,694         9,138

Cash, at Beginning of Period                         27,101             -             -
                                               ------------- ------------- -------------

Cash, at End of Period                         $      9,138  $     28,694  $      9,138
                                               ============= ============= =============
Supplemental Cash Flow Disclosures:
  Interest paid                                $          -  $          -  $          -
  Income taxes paid                            $          -  $          -  $          -


               See accompanying notes to financial statements.


                                      15
<PAGE>
</TABLE>

                         Kubla Khan, Inc.
                  (A Development Stage Company)

                  NOTES TO FINANCIAL STATEMENTS
                        December 31, 2002

Note 1 - Nature of business and summary of significant accounting policies
--------------------------------------------------------------------------

Nature of business - Kubla Khan, Inc. was incorporated on March 28, 2000, in
the state of Utah. Prior to 2001, the Company had not conducted any operations
and had incurred only expenses for travel for the review of various business
opportunities and marketing strategies.  Accordingly, the Company prepared its
financial statements in compliance with the requirements for development stage
companies.

During 2001, upon completion of a public offering of its common stock, the
Company began doing business as an overstock and overrun specialist whereby it
purchases excess production of clothing and other personal items from
manufacturers or jobbers. These items are then transported to the
Intermountain Area where they are sold directly to the public, sold to
discount retail stores, or placed on consignment with such stores.


Inventory - Inventories of products held for resale are valued at the lower of
cost or market, using the FIFO method.  Certain product inventory is consigned
to retail stores for disposition. However, such items continue to be reflected
in the Company's inventory until the consignee sells them. At which time a
sale is recorded and such items are removed from the Company's inventory and
charged to cost of sales.


Property and Equipment - Property and equipment are recorded at acquisition
cost and depreciated over their estimated useful lives using accelerated
methods.  Maintenance and repairs are charged to expense.  Renewals and
betterments, which substantially extend the useful life, are capitalized.
The cost and accumulated depreciation of disposed assets are eliminated from
the accounts.  Profits and losses resulting from such disposition are included
in income.

Property and equipment consists of the following at December 31, 2002:

                  Computer Equipment                $  1,593
                  Accumulated Depreciation            (1,003)
                                                    ---------
                  Net Property and Equipment        $    590
                                                    =========


Income taxes - The Company has not provided for deferred tax assets or
liabilities because it has a tax loss carryforward of approximately $56,000 at
December 31, 2002 available to offset future profits for the next 20 years. No
tax benefit for the loss carryforward has been established due to the
Company's lack of operating history and its ability to demonstrate that it can
realize a profit from future operations.


                                16
<PAGE>


                         Kubla Khan, Inc.
                  (A Development Stage Company)

                  NOTES TO FINANCIAL STATEMENTS
                        December 31, 2002


Note 1-Nature of business and summary of significant accounting policies(Cont)
------------------------------------------------------------------------------

Estimates - The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities at
the date of the financial statements and the reported amounts of revenue and
expenses during the reporting period.  Actual amounts could differ from those
estimates.

Per share information - Per share information has been computed using the
weighted average number of common shares outstanding during the period.


Note 2- Common Stock / Deferred Offering Costs
----------------------------------------------

During 2000, the Company issued 36,744 shares of its common stock to four
individuals for $7,500 cash. In May 2001 the Company completed an initial
public offering (IPO) of 75,000 shares of its common stock at $1.00 per share.
Costs related to the IPO consisting of legal and accounting costs as well as
filing fees were deferred and included in other assets at December 31, 2001.
Such costs were charged as a reduction to paid in capital upon successful
completion of the IPO in 2001.


Note 3 -  Related Party Transactions
------------------------------------

Prior to completion of the Company's 2001 IPO, the officers of the Company had
paid their own travel costs.  The Company without interest later reimbursed
such amounts, included in Advances from Officers/Stockholder at December 31,
2000.

The Company's president provided 176 hours of service valued at $15 per hour
to the formation and initial marketing efforts of the Company and provided
office facilities valued at $1,303 for use by the Company. Both the services
and facilities use have been reflected as a capital contribution by the
president.

The Company currently rents its office space from the president on
month-to-month basis for $500 per month.



                                17
<PAGE>


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

         None; not applicable.


                             PART III


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

Identification of Directors and Executive Officers.
--------------------------------------------------

     The following table sets forth the names of all of our current directors
and executive officers.  These persons will serve until the next annual
meeting of the stockholders (held in March of each year) or until their
successors are elected or appointed and qualified, or their prior resignation
or termination.

                                                    Date of
                        Positions                 Election or
Name                      Held         Age        Designation
----                    ----------    ----        -----------

William S. Roberts      President      62           03/28/00
Wallace s. Pidcock      Vice Pres.     51           03/28/00
Kristine D. Ramsey      Sec., Treas.   35           03/28/00


Business Experience
--------------------

      WILLIAM S. ROBERTS serves as our President and Chairman of The Board of
Directors. From July 1999 through June 2000, Mr. Roberts was a national
account manager for Amembal Capital Corporation, an equipment leasing company.
From October 1998 to July 1999 he was a self-employed business consultant.
From January 1998 until September 1998, he was an area sales manager for Data
Transmission Network, a satellite information systems company. Also since
1998, he has been the Secretary/Treasurer and a director of Industries
International Incorporated, a company involved in the seeking of properties
for golf course development. From 1994 until 1996, he was president of AAOGI
Investment Corp., an NASD member securities firm which was subsequently sold.
Since 1992 he has also been self-employed as a business consultant to
companies entering the public arena. From 1980 until 1992, he was employed by
a number of stock brokerage firms in Salt Lake City, Utah. From 1972 until
1979 he was vice-president, Financial Principal, and Chief Financial Officer
of two stock brokerages in Salt Lake City. Over 20 years ago, Bill signed a
consent decree with the US Securities and Exchange Commission in regards to an
SEC investigation of Le Barron Securities, Inc. without admitting or denying
guilt. Bill was vice-president and Financial Principal of Le Barron
Securities, Inc. The penalties imposed under this decree were spread over an
8-month period of time. For the first four months, Bill was suspended from
being associated in the securities industry. For the following four months,
Bill was allowed to be involved in the securities industries as a Registered
Representative but barred from being a Registered Principal. At the end of the
eight months, Bill was allowed to resume full involvement in the securities
industries.

                                18
<PAGE>

      WALLACE PIDCOCK, our vice-president and Director. Since July 2001 he has
been Operations Manager for Wackenhut Security Services, Inc. in Las Vegas,
Nevada.  From 1993 through June 2001 he was Director of Security for Smith
Food and Drug Store in the Las Vegas, NV area. From 1989-1993 he was a
Security Investigator and was employed in celebrity protection for the Desert
Inn and Casino. From 1986-1989 he was employed as a Private Investigator. From
1973 to 1986, Wallace worked for Southern Pacific Railroad as a brakeman.

      KRISTINE D. RAMSEY serves as our Secretary, Treasurer and Director. From
1996-1998, Kristine acted as a merchandiser with both Maybelline and Revlon
involved in merchandise resets which included restocking and display. From
1998 to June of 2001 she was employed with Chipsea Nursery as a merchandiser.
From August 2000 to June 2001 she was merchandising flowers on a part time
basis as a merchandise representative. Since June 2001 she has been employed
as a representative for Retail Merchandising Services doing merchandise resets
in Target Stores.

Significant Employees
---------------------

     We have no employees who are not executive officers, but who are expected
to make a significant contribution to our business. It is expected that
current members of management and the Board of Directors will be the only
persons whose activities will be material to our operations.  Members of
management are the only persons who may be deemed to be promoters.

Family Relationships
--------------------

     Wallace Pidcock, our vice-president and Director, is the uncle of
Kristine D. Ramsey, our Secretary, Treasurer and Director.

Involvement in Other Public Companies
-------------------------------------

     None of our board members serve as board members of any other public
companies except William Roberts who, during the calendar year 2002, was
Secretary/Treasurer and a director of Industries International, Inc., a Nevada
public corporation.

Involvement in Certain Legal Proceedings.
----------------------------------------

     During the past five years, no present or former director, executive
officer or person nominated to become a director or an executive officer:

          (1) was a general partner or executive officer of any business
     against which any bankruptcy petition was filed, either at the time of
     the bankruptcy or two years prior to that time;

          (2) was convicted in a criminal proceeding or named subject to a
     pending criminal proceeding (excluding traffic violations and other minor
     offenses);

          (3) was subject to any order, judgment or decree, not subsequently
     reversed, suspended or vacated, of any court of competent jurisdiction,
     permanently or temporarily enjoining, barring, suspending or otherwise
     limiting his involvement in any type of business, securities or banking
     activities; or

          (4) was found by a court of competent jurisdiction (in a civil
     action), the Securities and Exchange Commission or the Commodity Futures
     Trading Commission to have violated a federal or state securities or


                                19
<PAGE>

     commodities law, and the judgment has not been reversed, suspended or
     vacated.

Section 16(a) Beneficial Ownership Reporting Compliance
-------------------------------------------------------

     We do not have a class of securities registered pursuant to Section 12 of
the Exchange Act and therefore our officers, directors and 10% shareholders
are not required to comply with Section 16(a) of the Exchange Act.

ITEM 10. EXECUTIVE COMPENSATION.

Cash Compensation
-----------------

     The following table sets forth the aggregate compensation paid by us for
services rendered during the periods indicated (past three years):

<TABLE>
<CAPTION>
                    SUMMARY COMPENSATION TABLE

                            Annual            Long Term Compensation
                        --------------------- ------------------------------
                        Annual Compensation   Awards                 Payouts
                        --------------------- ---------------------- -------
(a)          (b)       (c)     (d)   (e)      (f)           (g)      (h)    (i)
                                                            Secur-
                                      Other                 ities           All
Name and     Year or                  Annual   Rest-        Under-   LTIP   Other
Principal    Period    Salary  Bonus  Compen-  ricted       lying    Pay-   Compen-
Position     Ended     ($)     ($)    sation   Stock        Options  outs   sation
-----------------------------------------------------------------------------------

          <c>     <c>       <c>    <c>      <c>          <c>      <c>    <c>
W.S. Roberts
President/
Director     2002    $    -      -       -        -             -      -       -
             2001    $5,198      -       -        -             -      -       -

K. Ramsey
Sec./Treas/
Director     2002    $    -      -       -        -             -      -       -
             2001    $5,198      -       -        -             -      -       -

</TABLE>

     Except as stated above, no cash compensation, deferred compensation or
long-term incentive plan awards were issued or granted to our management
during the fiscal years ended December 31, 2002 and 2001.  Further, no member
of management has been granted any option or stock appreciation rights.
Accordingly, no tables relating to such items have been included within this
Item.

     There are no plans whereby we would issue any of our securities to
management, promoters, their affiliates or associates in consideration of
services rendered or otherwise.

Compensation of Directors
-------------------------

     We have no arrangement for compensating our directors.

                                20
<PAGE>

Employment Contracts and Termination of Employment
and Change-in-Control Arrangements
-------------------------------------------------

      There are no employment contracts, compensatory plans or arrangements,
including payments to be received from us, with respect to any of our
directors or executive officers which would in any way result in payments to
any such person because of his or her resignation, retirement or other
termination of employment with us or our subsidiaries, any change in control
of our company, or a change in the person's responsibilities following a
change in our company's control.

      Nor are there any agreements or understandings for any director or
executive officer to resign at the request of another person; none of our
directors or executive officers is acting on behalf of or will act at the
direction of any other person.

Bonuses and Deferred Compensation
---------------------------------

     None.

Compensation Pursuant to Plans
------------------------------

     None.

Pension Table

     None; not applicable.

Other Compensation
------------------

     None.


ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

Security Ownership of Certain Beneficial Owners
-----------------------------------------------

     The following table sets forth the beneficial ownership of those persons
who are known to be the beneficial owners of more than 5 percent of our common
stock as of date of this report.  Each of these persons has sole investment
and sole voting power over the shares indicated.


                                       Number                  Percent
Name and Address             of Shares Beneficially Owned      of Class
-----------------            ----------------------------      --------

William S. Roberts                     11,023                     9.86%
6990 So. Park Centre Dr.
Suite 315
Salt Lake City, UT 84121

Kristine D. Ramsey                     12,860                    11.50%
6861 So. Virginia Hills Drive
Salt Lake City, UT 84121

Jay Terrell
1241 Major Street
Salt Lake City, UT 84111               11,024                     9.86%


                                21
<PAGE>

Security Ownership of Management
--------------------------------

     The following table sets forth the share holdings of our directors and
executive officers as of date of this report.  Each of these persons has sole
investment and sole voting power over the shares indicated.


                                      Number               Percent
Name and Address           of Shares Beneficially Owned    of Class
----------------           ----------------------------    --------

William S. Roberts                    11,023                9.86%
6990 So. Park Centre Dr.
Suite 315
Salt Lake City, UT 84121

Wallace S. Pidcock                     1,837                1.64%
401 Huntly Drive
Las Vegas, NV 89128

Kristine D. Ramsey                    12,860               11.50%
6861 So. Virginia Hills Drive
Salt Lake City, UT 84121

All directors and
executive officers
as a group (3)                        25,720               23.01%


Changes in Control
------------------

      There are no present arrangements or pledges of our securities which may
result in a change in our control.


ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

Transactions with Directors, Executive
Officers, 5% Security Holders and Others
----------------------------------------

     There have been no material transactions, series of similar transactions,
currently proposed transactions, or series of similar transactions, to which
our company or any of our subsidiaries, was or is to be a party, in which the
amount involved exceeded $60,000 and in which any director or executive
officer, or any security holder who is known to own of record or beneficially
more than 5 percent of our common stock, or any member of the immediate family
of any of the foregoing persons, had a material interest.

Parents
-------

     None

Transactions with Promoters
---------------------------

     Our only promoters are our officers and directors.  There have been no
material transactions with these individuals other than William Roberts and
Kristine Ramsey receive $15.00 per hour in compensation for any services
performed in pursuing our business plan (aggregating none during 2002, $5,198
each during 2001 and none in 2000).  In addition, Mr. Roberts receives $500

                                22
<PAGE>

per month for use of his home as our office.  In each of these instances
management believes that the same are competitive or less than what we would
pay a nonrelated party for services/rent.

     Three of our officers/directors, as well as one individual who is not an
officer or director, purchased stock at inception; 36,744 common shares were
purchased by the four founding shareholders for $7,500.

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K.

Exhibits
--------

   Exhibit
   Number            Description
  ---------          ------------


     3.1.1          Articles of Incorporation *
     3.1.2          Amendment to Articles of Incorporation*
     3.2            By-laws*
    99.1            Section 1350 certification **
    99.2            Section 1350 certification**

*  Filed with the Securities and Exchange Commission on September 19, 2000 as
   part our initial Registration Statement on Form SB-2.

** Filed herewith

        (b) Reports on Form 8-K

        During the our fourth quarter, we filed no reports on Form 8-K.


ITEM 14: CONTROLS AND PROCEDURES

      During the year ended December 31, 2002, we formalized the procedures we
rely on to ensure that material information regarding our company and its
operations is provided to the public in a timely manner.  On March 21, 2003,
our principal executive and financial officer, Bill Roberts, evaluated the
effectiveness of these disclosure controls and procedures and determined that
there were no significant deficiencies in these procedures.

     Also, Mr. Roberts did not identify any deficiencies or material
weaknesses in our internal controls, nor did he identify fraud that involved
management or other employees who had a significant role in our internal
controls.  He did not find any deficiencies or weaknesses which would require
changes to be made or corrective actions to be taken related to our internal
controls.




                                23
<PAGE>


                                  SIGNATURES

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

                                      KUBLA KHAN INC.

Date: March 31, 2003

                                      By  /s/ William S. Roberts
                                      --------------------------------
                                      William S. Roberts
                                      President, Chief Financial
                                      Officer, Chief Accounting
                                      Officer & Chief Executive
                                      Officer



     In accordance with the Exchange Act, this report has been signed by the
following persons on behalf of the registrant and in the capacities and on the
dated indicated.


Date:  March 31, 2003
                                    /s/ Kristine D. Ramsey
                                    ---------------------------------
                                    Kristine Ramsey
                                    Director


Date: March 31, 2003                /s/ William S. Roberts
                                    ---------------------------------
                                    William S. Roberts
                                    Director





                                24
<PAGE>


                          CERTIFICATIONS

I, William S. Roberts, the Chief Executive Officer of Kubla Khan, Inc.,
certify that:

1. I have reviewed this annual report on Form 10-KSB of Kubla Khan, Inc.;

 2. Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this annual report;

 3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual report;

 4. I am responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the
registrant and have:

 a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities,
particularly during the period in which this annual report is being prepared;

 b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this annual
report (the "Evaluation Date"); and

 c) presented in this annual report my conclusions about the effectiveness of
the disclosure controls and procedures based on my evaluation as of the
Evaluation Date;

 5. I have disclosed, based on my most recent evaluation, to the registrant's
auditors and the audit committee of registrant's board of directors (or
persons performing the equivalent functions):

 a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and

b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls;
and

 6. I have indicated in this annual report whether or not there were
significant changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date of my most
recent evaluation, including any corrective actions with regard to significant
deficiencies and material weaknesses.

 Date: March 31, 2003
                          /s/ William S. Roberts
                          -------------------------------------------
                          William S. Roberts, Chief Executive Officer


                                25

<PAGE>


                          CERTIFICATIONS

I, William S. Roberts, the Chief Financial Officer of Kubla Khan, Inc. certify
that:

 1. I have reviewed this annual report on Form 10-KSB of Industries
International Incorporated;

2. Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this annual report;

3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual report;

 4. I am responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the
registrant and have:

 a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities,
particularly during the period in which this annual report is being prepared;

 b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this annual
report (the "Evaluation Date"); and

 c) presented in this annual report our conclusions about the effectiveness of
the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;

 5. I have disclosed, based on our most recent evaluation, to the registrant's
auditors and the audit committee of registrant's board of directors (or
persons performing the equivalent functions):

 a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and

 b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls;
and

6. I have indicated in this annual report whether or not there were
significant changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date of my most
recent evaluation, including any corrective actions with regard to significant
deficiencies and material weaknesses.

 Date: March 31, 2003      /s/ William S. Roberts
                          -----------------------------------------
                          William S. Roberts, Chief Financial Officer



                                26

<PAGE>