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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-QSB

|      |  |                                                                    
|----- |  | -------------------------------------------------------------------
|(X)   |  | QUARTERLY REPORT PURSUANT TO SECTION 13 or 15 (d) OF THE SECURITIES
|      |  | EXCHANGE ACT OF 1934                                               
|     
|      |  | For the quarterly period ended March 31, 2002                      
|     
|      |  | OR                                                                 
|     
|(   ) |  | TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
|      |  | EXCHANGE ACT OF 1934                                               
|      |  | For the transition period from to                                  

Commission File Number 1-9043

|                                                                    
|--------------------------------------------------------------------
|B.H.I.T. INC.
(Exact name of Registrant as specified in its charter)

|                                                   |  |                    
|-------------------------------------------------- |  | -------------------
|Delaware                                           |  | 36-3361229         
|(State or other jurisdiction of                    |  | (I.R.S. Employer   
|incorporation or organization)                     |  | Identification No.)
|                                                  
|6950 South Edgerton Road, Brecksville, Ohio        |  | 44141              
|(Address of principal executive offices)           |  | (Zip Code)         
|                                                  
|(440) 838-4700                                     |  |                    
|Registrants telephone number, including area code |  |                    

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the Registrant
was required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days.
                                                               
             Yes 
(X)     NO (   ).

Shares of Common Stock Outstanding as of May 2, 2002: 14,988,051

|                                              |  |                      |  | 
|--------------------------------------------- |  | -------------------- |  | 
|Transitional Small Business Disclosure Format |  | Yes (   )     No (X) |  | 





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TABLE OF CONTENTS



|                                                                                                      |  |  |  |  |  |  |  | 
|----------------------------------------------------------------------------------------------------- |  |  |  |  |  |  |  | 
|Consolidated Balance Sheets                                                                          
|Consolidated Statements of Operations For the Three Months Ended March 31, 2002 and 2001 (Unaudited) 
|Consolidated Statements of Stockholders Equity For the Three Months Ended March 31, 2002 (Unaudited)
|Consolidated Statements of Cash Flows For the Three Months Ended March 31, 2002 and 2001 (Unaudited) 
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)                                               
|ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS       
|ITEM 1. LEGAL PROCEEDINGS                                                                            
|ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K                                                             
|SIGNATURES                                                                                           



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B.H.I.T. INC.

QUARTERLY REPORT ON FORM 10-QSB
FOR THE THREE MONTHS ENDED MARCH 31, 2002

TABLE OF CONTENTS

|                                                                                                     |  |     
|---------------------------------------------------------------------------------------------------- |  | ----
|INDEX                                                                                                |  | PAGE
|                                                                                                    
|PART I FINANCIAL INFORMATION                                                                        
|                                                                                                    
|ITEM 1. Financial Statements                                                                         |  |     
|                                                                                                     |  |     
|Consolidated Balance Sheets
as of March 31, 2002
(unaudited) and December 31, 2001.                  |  | 3   
|                                                                                                     |  |     
|Consolidated Statements of Operations for the
three months ended March 31, 2002 and 2001 (unaudited) |  | 4   
|                                                                                                     |  |     
|Consolidated Statement of Stockholders Equity for the
three months ended March 31, 2002 (unaudited) |  | 5   
|                                                                                                     |  |     
|Consolidated Statements of Cash Flows for the
three months ended March 31, 2002 and 2001 (unaudited) |  | 6   
|                                                                                                     |  |     
|Notes to Consolidated Financial Statements (unaudited)                                               |  | 7   
|                                                                                                     |  |     
|ITEM 2. Managements Discussion and Analysis of Financial Condition
and Results of Operations        |  | 8-9 
|                                                                                                     |  |     
|PART II OTHER INFORMATION                                                                            |  |     
|                                                                                                     |  |     
|ITEM 1. Legal Proceedings                                                                            |  | 10  
|                                                                                                     |  |     
|ITEM 6. Exhibits and Reports on Form 8-K                                                             |  | 10  
|                                                                                                     |  |     
|SIGNATURES                                                                                           |  | 11  

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B.H.I.T. INC.

PART I  FINANCIAL INFORMATION




Consolidated Balance Sheets

ITEM 1. FINANCIAL STATEMENTS

|                                           |                                                                                                                   |   |                |             |               |   |           |             |  
|------------------------------------------ | ----------------------------------------------------------------------------------------------------------------- | - | -------------- | ----------- | ------------- | - | --------- | ----------- | -
|                                           |                                                                                                                   |   | March 31, 2002 |             | Dec. 31, 2001
|                                           |                                                                                                                   |   |                |             |              
|                                           |                                                                                                                   |   | (Unaudited)    |             |               |   |          
|ASSETS                                     |                                                                                                                   |   |                |             |               |   |           |            
|                                          
|                                           | Cash and cash equivalents                                                                                         |   | $              | 1,447,703   |               |   | $         | 1,471,139   |  
|                                           | Interest receivable on cash and cash equivalents                                                                  |   |                | 2,599       |               |   |           | 2,935       |  
|                                           | Mortgage loan receivable                                                                                          |   |                | 275,000     |               |   |           | 275,000     |  
|                                           | Interest receivable on mortgage loan                                                                              |   |                | 2,750       |               |   |           | 5,500       |  
|                                           | Miscellaneous receivable                                                                                          |   |                |            |               |   |           | 55          |  
|                                           | Prepaid insurance                                                                                                 |   |                | 18,000      |               |   |           |            |  
|                                           |                                                                                                                   |   |                |             |               |   |           |            
|Total Assets                               |                                                                                                                   | $ | 1,746,052      |             |               | $ | 1,754,629 |            
|                                           |                                                                                                                   |   |                |             |               |   |           |            
|                                          
|LIABILITIES AND STOCKHOLDERS EQUITY       |                                                                                                                   |   |                |             |               |   |           |            
|                                          
|                                           | Accounts payable and other accrued expenses                                                                       |   | $              | 32,161      |               |   | $         | 37,599      |  
|                                          
|Stockholders Equity                       |                                                                                                                   |   |                |             |               |   |           |            
|                                          
|                                           | Shares of Common Stock, $0.01 par value,
20,000,000 shares authorized, 15,020,808 shares
issued for 2002 and 2001 |   |                | 88,060,847  |               |   |           | 88,060,847  |  
|                                           | Accumulated deficit                                                                                               |   |                | (86,338,767 | )             |   |           | (86,335,628 | )
|                                           | Treasury stock, at cost, for 32,757 shares
of Common Stock                                                        |   |                | (8,189      | )             |   |           | (8,189      | )
|                                           |                                                                                                                   |   |                |             |               |   |           |            
|Total Stockholders Equity                 |                                                                                                                   |   | 1,713,891      |             |               |   | 1,717,030 |            
|                                           |                                                                                                                   |   |                |             |               |   |           |            
|Total Liabilities and Stockholders Equity |                                                                                                                   | $ | 1,746,052      |             |               | $ | 1,754,629 |            
|                                           |                                                                                                                   |   |                |             |               |   |           |            

See accompanying notes to the Consolidated Financial Statements.

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B.H.I.T. INC.




Consolidated Statements of Operations
For the Three Months Ended March 31, 2002 and 2001
(Unaudited)

|                                                                                                                                            |                                              |              |   |        |        |      |        |        |         |  
|------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------- | ------------ | - | ------ | ------ | ---- | ------ | ------ | ------- | -
|                                                                                                                                            |                                              |              |   | 2002   |        | 2001
|                                                                                                                                            |                                              |              |   |        |        |     
|INCOME                                                                                                                                      |                                              |              |   |        |        |      |        |       
|                                                                                                                                            | Interest income on cash and cash equivalents |              | $ | 7,931  |        |      | $      | 20,372 |        
|                                                                                                                                            | Interest income on mortgage receivable       |              |   | 8,250  |        |      |        | 8,250  |        
|                                                                                                                                            |                                              |              |   |        |        |      |        |       
|                                                                                                                                            |                                              | Total income |   |        | 16,181 |      |        |        | 28,622  |  
|                                                                                                                                            |                                              |              |   |        |        |      |        |       
|EXPENSES                                                                                                                                    |                                              |              |   |        |        |      |        |       
|                                                                                                                                            | General and administrative                   |              |   | 19,320 |        |      |        | 45,385 |        
|                                                                                                                                            |                                              |              |   |        |        |      |        |       
|                                                                                                                                            |                                              | Net loss     |   | $      | (3,139 | )    |        | $      | (16,763 | )
|                                                                                                                                            |                                              |              |   |        |        |      |        |       
|Basic and diluted net loss per share of Common
Stock (based on weighted average number of
shares outstanding of 14,988,051 in 2002 and 2001 |                                              | $            |  |        |        | $    | (0.001 | )     
|                                                                                                                                            |                                              |              |   |        |        |      |        |       

See accompanying notes to the Consolidated Financial Statements.

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B.H.I.T. INC.




Consolidated Statements of Stockholders Equity
For the Three Months Ended March 31, 2002
(Unaudited)

|                                                 |  |              |            |        |  |         |            |                |  |        |             |       |  |  |        |  |  |   |        |   |  |   |           |  
|------------------------------------------------ |  | ------------ | ---------- | ------ |  | ------- | ---------- | -------------- |  | ------ | ----------- | ----- |  |  | ------ |  |  | - | ------ | - |  | - | --------- | -
|                                                 |  | Common Stock |            |        |  |         |            |                |  |        |             |       |  |  |        |  |  |  
|                                                 |  |              |            |        |  |         |            | Treasury Stock |  |        |             |      
|                                                 |  | Shares       |            |        |  |         |            | Accumulated    |  |        |             |       |  | 
|                                                 |  | Issued       |            | Amount |  | Deficit |            | Shares         |  | Amount |             | Total
|                                                 |  |              |            |        |  |         |            |                |  |        |             |      
|Stockholders equity (deficit)
December 31, 2001 |  |              | 15,020,808 |        |  | $       | 88,060,847 |                |  | $      | (86,335,628 | )     |  |  | 32,757 |  |  | $ | (8,189 | ) |  | $ | 1,717,030 |  
|                                                
|Net loss                                         |  |              |           |        |  |         |           |                |  |        | (3,139      | )     |  |  |       |  |  |   |       |   |  |   | (3,139    | )
|                                                 |  |              |            |        |  |         |            |                |  |        |             |       |  |  |        |  |  |   |        |   |  |   |           |  
|                                                
|Stockholders equity (deficit)
March 31, 2002    |  |              | 15,020,808 |        |  | $       | 88,060,847 |                |  | $      | (86,338,767 | )     |  |  | 32,757 |  |  | $ | (8,189 | ) |  | $ | 1,713,891 |  
|                                                 |  |              |            |        |  |         |            |                |  |        |             |       |  |  |        |  |  |   |        |   |  |   |           |  

See accompanying notes to the Consolidated Financial Statements.

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B.H.I.T. INC.




Consolidated Statements of Cash Flows
For the Three Months Ended March 31, 2002 and 2001
(Unaudited)

|                                                 |                                                                                   |                                       |                                       |   |         |         |           |   |         |        |  
|------------------------------------------------ | --------------------------------------------------------------------------------- | ------------------------------------- | ------------------------------------- | - | ------- | ------- | --------- | - | ------- | ------ | -
|                                                 |                                                                                   |                                       |                                       |   | 2002    |         | 2001     
|                                                 |                                                                                   |                                       |                                       |   |         |         |          
|Operating Activities:                            |                                                                                   |                                       |                                       |   |         |         |           |  
|                                                 |                                                                                   | Net Loss                              |                                       | $ | (3,139  | )       |           | $ | (16,763 | )     
|                                                
|                                                 | Adjustments to reconcile net loss to net cash flows
used in operating activities: |                                       |                                       |   |         |         |           |   |        
|                                                
|                                                 |                                                                                   | Net change in:                        |                                       |   |         |         |           |   |         |       
|                                                 |                                                                                   |                                       | Interest receivables                  |   |         | 3,086   |           |   |         | (4,033 | )
|                                                 |                                                                                   |                                       | Prepaid insurance                     |   |         | (18,000 | )         |   |         | 8,132  |  
|                                                 |                                                                                   |                                       | Miscellaneous receivables             |   |         | 55      |           |   |         |       |  
|                                                 |                                                                                   |                                       | Accounts payable and accrued expenses |   |         | (5,438  | )         |   |         | (8,600 | )
|                                                 |                                                                                   |                                       |                                       |   |         |         |           |  
|                                                 |                                                                                   | Net cash used in operating activities |                                       |   | (23,436 | )       |           |   | (21,264 | )     
|                                                
|Cash and cash equivalents at beginning of period |                                                                                   |                                       | 1,471,139                             |   |         |         | 1,552,507 |  
|                                                 |                                                                                   |                                       |                                       |   |         |         |           |  
|Cash and cash equivalents at end of period       |                                                                                   | $                                     | 1,447,703                             |   |         | $       | 1,531,243 |  
|                                                 |                                                                                   |                                       |                                       |   |         |         |           |  

See accompanying notes to the Consolidated Financial Statements.

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B.H.I.T. INC.




NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1. BASIS OF PRESENTATION

B.H.I.T. Inc. (the Company) was organized under the laws of the State of
Massachusetts pursuant to a Declaration of Trust filed March 19, 1985 for the
purpose of investing in mortgage loans. The Company was subsequently reorganized
as a Delaware corporation on March 13, 1987.

The accompanying financial statements have been prepared by the Company pursuant
to the rules and regulations of the Securities and Exchange Commission. In the
opinion of management, these financial statements give effect to all normal
recurring adjustments necessary to present fairly the financial position of the
Company as of March 31, 2002 and December 31, 2001, and the results of
operations and cash flows for the three months ended March 31, 2002 and March
31, 2001.

The financial information included herein for the quarters ended March 31, 2002
and March 31, 2001 is unaudited.

Although the Company believes that the disclosures included herein are adequate
to make the information not misleading, certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been omitted. Accordingly,
the accompanying financial statements should be read in conjunction with the
Companys latest annual report on Form 10-KSB for the year ended December 31,
2001.

The results of operations for the interim period presented are not necessarily
indicative of the results to be expected for the full year.

NOTE 2. MORTGAGE LOANS RECEIVABLES

As of March 31, 2002, the Company holds a note totaling $275,000 secured by a
mortgage on commercial property in Dallas, Texas. The mortgage yields 12% per
annum and requires monthly interest payments. The current maturity date for this
loan is April 1, 2003. As of March 31, 2002, the carrying value of the mortgage
loan approximated its fair value.

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B.H.I.T. INC.




ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS
AND RESULTS OF OPERATIONS

GENERAL

The Registrant, B.H.I.T. Inc. (the Company) was originally organized as a
Massachusetts business trust pursuant to a Declaration of Trust filed March 19,
1985 under the name VMS Hotel Investment Trust and subsequently reorganized as a
Delaware corporation on March 13, 1987. The Company changed its name to B.H.I.T.
Inc. in 1998.

BUSINESS OPERATIONS AND HISTORY

The Companys current operations relate primarily to servicing its mortgage and
cash investment portfolio and seeking profitable investments for its available
funds.

The business of the Company is not seasonal and the Company does no foreign or
export business. The Company does not segregate revenue or assets by
geographical region, and such presentation is not applicable and would not be
material to an understanding of the Companys business taken as a whole.

The Company was originally established to invest in mortgage loans principally
to entities affiliated with VMS Realty Partners. These loans were collateralized
by hotel and resort properties.

As the result of a public offering that concluded January 13, 1986, the Company
received gross proceeds of $98,482,751. During the years 1989 through 1992 the
Company experienced severe losses due primarily to a decline in real estate
property values and the resulting default on mortgage loans held by the Company.
The Company has recorded losses every year since 1989 resulting in the
accumulated deficit totaling $86,338,767 at March 31, 2002.

In July 1999, Harvey Polly (Polly), the majority shareholder and then Chairman
of the Board of Directors, entered into an agreement to sell his stock in the
Company to Vesper Corporation or its nominee. In September 2000 the stock sale
was completed, whereby Polly sold 5,370,563 shares constituting his entire
holdings, and at the same time, a charitable entity controlled by Polly and his
wife sold 500,000 shares of the Company to Arrowhead Holdings Corporation
(Arrowhead), the nominee of Vesper Corporation. Upon closing of this
transaction, Arrowhead held 39% of the outstanding shares of the Company.
Effective October 1, 2001, Polly resigned from the Board of Directors and as an
officer of the Company.

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B.H.I.T. INC.

RESULTS OF OPERATIONS

Total income for the quarters ended March 31, 2002 and 2001 was $16,181 and
$28,622, respectively. The decrease of $12,441 in total income during the first
three months of 2002 is the result of reduced interest income due to lower
interest rates on cash investments.

Total expenses for the quarters ended March 31, 2002 and 2001 were $19,320 and
$45,385, respectively. The decrease of $26,065 in total expenses is primarily
the result of expense reductions associated with relocation of the Companys
principal office to a facility shared with the majority shareholder, Arrowhead
Holdings Corporation, in Brecksville, Ohio. Prior to September 30, 2001, the
Company operated an office in New York City with two full-time employees. A
reduction of $21,727 in salaries and benefit expenses in the first quarter is
the result of the elimination of the two full-time employees. A $5,012 reduction
for rent and utilities expenses is the result of savings realized in the
allocation of expenses in a shared facility versus the cost of a separate
office. These reductions were partially offset by an increase of $674 in other
miscellaneous administrative expenses during the first quarter.

The net loss for the three months ended March 31, 2002 was $3,139 ($0.000 per
share) and for 2001 was $16,763 ($0.001 per share), respectively.

LIQUIDITY AND CAPITAL RESOURCES

Cash and cash equivalents consist of cash and short-term investments. The
Companys cash and cash equivalents balance at March 31, 2002 and December 31,
2001 was $1,447,703 and $1,471,139, respectively. Cash and cash equivalents
decreased in 2002 by $23,436, resulting from the net loss of $3,139,
decreases various liabilities totaling $5,438 and an increase in prepaid insurance of
$18,000, offset by a decrease in interest receivables and other assets of
$3,141.

At this time, there are no material commitments for capital expenditures. The
Companys cash is sufficient to meet its needs for anticipated operating
expenses. The Company deems its liquidity to be adequate.

During 1997, the Company invested $1,000,000 in a mortgage. This mortgage yields
12% per annum and requires monthly interest payments. Principal payments made in
April 1998 and June 2000 were $700,000 and $25,000, respectively. As of March
31, 2002 the outstanding mortgage balance was $275,000. The maturity date has
been extended by mutual consent on several occasions. The current maturity date
is April 1, 2003.

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B.H.I.T. INC.

PART II  OTHER INFORMATION




ITEM 1. LEGAL PROCEEDINGS

The Registrant is not aware of any material legal proceedings to which the
Company is a party or to which any of its property is subject.




ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

|    |  |                    
|--- |  | -------------------
|(a) |  | EXHIBITS           
|   
|    |  | NONE               
|   
|(b) |  | REPORTS ON FORM 8-K
|   
|    |  | NONE               

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SIGNATURES

Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.

|              |  |                                                                                                                 |  |                   
|------------- |  | --------------------------------------------------------------------------------------------------------------- |  | ------------------
|B.H.I.T. Inc. |  |                                                                                                                
|             
|             
|By:           |  | /s/ John V. CurciJohn V. Curci
Vice-President, Treasurer & Chief Financial Officer
Principal Accounting Officer |  | Date: May 14, 2002

11