##### Table of Contents

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549



FORM 10-QSB



Quarterly Report Under Section 13 or 15(d) of the
Securities Exchange Act of 1934



For the quarterly period ended March 31, 2004



Commission File No.000-29915



CHINA XIN NETWORK MEDIA CORPORATION



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



|                                                     |  |                                           
|---------------------------------------------------- |  | ------------------------------------------
|Florida                                              |  | 65-0786722                                
|(State
      or other jurisdiction of incorporation) |  | (I.R.S.
      Employer Identification No.)



3080 Brabant-Marineau, Montreal, Quebec, CANADA  H4A
1K7

(Address of principal executive offices)



Tel: (514) 380-3805    Fax: (514) 338-1163

(Issuer's telephone number)



* * * * * * * * * * * * * * * * * * * * * *



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

YES {X}     NO {  }



The number of shares of CHINA XIN NETWORK MEDIA
CORPORATION Common Stock (Par Value $0.001) outstanding at May 14, 2004 was
337,865,401.



Transitional Small Business Disclosure Format    YES{  }NO {X}



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TABLE
OF CONTENTS



|                                 |  |                                                                                        |  |         
|-------------------------------- |  | -------------------------------------------------------------------------------------- |  | --------
|                                 |  |                                                                                        |  | PAGE NO.
|                                 |  | PART I                                                                                 |  |         
|                                 |  |                                                                                       
|Item 1.                          |  | Financial Statements                                                                   |  | 2       
|                                 |  |                                                                                       
|Item 2.                          |  | Plan of Operation                                                                      |  | 10      
|                                 |  |                                                                                       
|Item 3.                          |  | Controls and Procedures                                                                |  | 16      
|                                 |  |                                                                                       
|                                 |  | PART II                                                                                |  |         
|                                 |  |                                                                                       
|Item 1.                          |  | Legal Proceedings                                                                      |  | 16      
|                                 |  |                                                                                       
|Item 2.                          |  | Changes in Securities and Small Business Issuer
        Purchases of Equity Securities |  | 16      
|                                 |  |                                                                                       
|Item 6.                          |  | Exhibits and Reports on Form 8-K                                                       |  | 17      
|                                 | 
|Signatures                       |  | 18                                                                                    
|                                 | 
|Exhibit Index and Certifications |  | 19                                                                                    

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##### Table of Contents

PART I. FINANCIAL INFORMATION



ITEM 1. FINANCIAL
STATEMENTS



REVIEW ENGAGEMENT REPORT



To the Shareholders of

China Xin Network Media Corporation and Subsidiary

(A Development Stage Company)



I have reviewed the consolidated interim balance sheet of
China Xin Network Media Corporation and Subsidiary (a development stage company)
as at March 31, 2004 and the consolidated interim statements of operations and
comprehensive income(loss) and cash flows for the period then ended from October
19, 2000 (date of inception) to March 31, 2004. My review was made in accordance
with generally accepted standards in the Unites States of America for review
engagements and accordingly consisted primarily of enquiry, analytical
procedures and discussion related to information supplied to me by the Company.



A review does not constitute an audit and consequently I
do not express an audit opinion on these interim consolidated financial
statements.



Based on my review, nothing has come to my attention that
causes me to believe that these interim consolidated financial statements are
not, in all material respects, in accordance with generally accepted accounting
principles in the United States of America.



|By: //s 
        FRANCO LAPOSTA                                                        
|---------------------------------------------------------------------------------------
|                                                                                       
|Franco  LaPosta, CA
        Chartered Accountants
        Montreal, Quebec May 14, 2004

2

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Table of Contents





CHINA XIN NETWORK MEDIA CORPORATION AND SUBSIDIARY

(A DEVELOPMENT STAGE COMPANY)



CONSOLIDATED BALANCE SHEETS

Unaudited

|                                                                                           |  |                        |            |  
|------------------------------------------------------------------------------------------ |  | ---------------------- | ---------- | -
|                                                                                           |  | March 31,
        2004 |           
|ASSETS                                                                                     |  |                        |            |  
|Current Assets:                                                                            |  |                        |            |  
|Cash                                                                                       |  | $                      | 676        |  
|Sales Tax Receivable                                                                       |  |                        |            |  
|R&D Refundable Tax Credits                                                                 |  |                        | 212,308    |  
|                                                                                           |  |                        |            |  
|Total current assets                                                                       |  |                        | 212,924    |  
|                                                                                           |  |                        |            |  
|Fixed Assets                                                                               |  |                        | 25,672     |  
|Goodwill (Note 7)                                                                          |  |                        | 4,762,020  |  
|                                                                                           |  |                        |            |  
|Total assets                                                                               |  | $                      | 5,000,616  |  
|                                                                                           |  |                        |            |  
|                                                                                           |  |                        |            |  
|LIABILITIES AND STOCKHOLDERS' EQUITY                                                       |  |                        |            |  
|Current Liabilities:                                                                       |  |                        |            |  
|Accounts payable                                                                           |  | $                      |            |  
|Due to officers and employees                                                              |  |                        | 38,463     |  
|Loan payable (Note 6)                                                                      |  |                        |            |  
|                                                                                           |  |                        |            |  
|Total current liabilities                                                                  |  |                        | 38,463     |  
|                                                                                           |  |                        |            |  
|Contingencies (Note 5)                                                                     |  |                        |            |  
|                                                                                           |  |                        |            |  
|Stockholders' Equity:                                                                      |  |                        |            |  
|Common stock, $.001 par value; authorized
        500,000,000 shares; 30,000,000 preferred |  |                        |            |  
|issued and outstanding 337,865,401 shares and
        140,395,401 shares, respectively     |  |                        | 337,866    |  
|Paid-in capital deficiency                                                                 |  |                        | 6,815,147  |  
|Accumulated deficit during development stage                                               |  |                        | (2,190,860 | )
|                                                                                           |  |                        |            |  
|Total stockholders' equity                                                                 |  |                        | 4,962,153  |  
|                                                                                           |  |                        |            |  
|Total liabilities and stockholders' equity                                                 |  | $                      | 5,000,616  |  
|                                                                                           |  |                        |            |  





See notes to consolidated financial statements.

3

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CHINA XIN NETWORK MEDIA CORPORATION AND SUBSIDIARY

(A DEVELOPMENT STAGE COMPANY)



CONSOLIDATED INTERIM STATEMENTS OF OPERATIONS AND
COMPREHENSIVE INCOME (LOSS)

Unaudited



|                                                 |                                        |             |                                        |   |                                              |   |   |             |  
|------------------------------------------------ | -------------------------------------- | ----------- | -------------------------------------- | - | -------------------------------------------- | - | - | ----------- | -
|                                                 | For the Period                         |             | For the Period                         |   | Cumulative                                   |  
|                                                 | January 1, 2004
        March 31, 2004 |             | January 1, 2003
        March 31, 2003 |   | Oct. 19, 2000
        March 31,
        2004 |  
|Sales:                                           |                                        |             |                                        |   |                                              |   |   |             |  
|Income                                           | $                                      |             |                                        |   |                                              |   | $ | 34,616      |  
|Expenses:                                        |                                        |             |                                        |   |                                              |   |   |             |  
|Selling, general and administrative              | $                                      | 50,002      |                                        | $ | 331,384                                      |   | $ | 2,225,476   |  
|                                                 |                                        |             |                                        |   |                                              |   |   |             |  
|Loss Before Provision for Income Taxes           |                                        | (50,002     | )                                      |   | (331,384                                     | ) |   | (2,190,860  | )
|                                                 |                                        |             |                                        |   |                                              |   |   |             |  
|Provision for Income Taxes                       |                                        |             |                                        |   |                                              |   |   |             |  
|Comprehensive Net ( Loss)                        |                                        | (50,002     | )                                      |   | (331,384                                     | ) |   | (2,190,860  | )
|                                                 |                                        |             |                                        |   |                                              |   |   |             |  
|Net Loss Per Common Share                        | $                                      | (0.00       | )                                      |   | (0.003                                       | ) |   | (0.006      | )
|Fully Diluted                                    | $                                      | (0.00       | )                                      |   | (0.003                                       | ) |   | (0.006      | )
|                                                 |                                        |             |                                        |   |                                              |   |   |             |  
|Weighted Average Common Shares Outstanding       |                                        | 337,865,401 |                                        |   | 104,452,401                                  |   |   | 337,865,401 |  
|Fully Weighted Average Common Shares Outstanding |                                        | 353,905,735 |                                        |   | 113,826,068                                  |   |   | 353,905,735 |  





See notes to consolidated financial statements.

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CHINA XIN NETWORK MEDIA CORPORATION AND SUBSIDIARY

(A DEVELOPMENT STAGE COMPANY)



CONSOLIDATED INTERIM STATEMENTS OF STOCKHOLDERS'
DEFICIENCY

FOR THE PERIOD FROM OCTOBER 19, 2000 TO MARCH 31, 2004

Unaudited



|                                                                            |                     |             |        |   |                            |  |                                                          |           |                                  |   |            |   |   |           |  
|--------------------------------------------------------------------------- | ------------------- | ----------- | ------ | - | -------------------------- |  | -------------------------------------------------------- | --------- | -------------------------------- | - | ---------- | - | - | --------- | -
|                                                                            | Common Stock Shares |             | Amount |   | Additional Paid-in Capital |  | Accumulated Deficit during the
        Development Stage |           | Stockholders'
        Deficiency |  
|Balance at June 30, 2003                                                    |                     | 115,902,401 |        | $ | 115,903                    |  | $                                                        | 1,011,849 |                                  | $ | (2,063,966 | ) | $ | (936,214  | )
|Loss for the Period July 1, 2003 to March 31,
        2004                  |                     |             |        |   |                            |  |                                                          |           |                                  |   | (126,894   | ) |   | (126,894  | )
|Issuance of Common Stock for Debt & Services                                |                     | 121,963,000 |        |   | 121,963                    |  |                                                          | 969,792   |                                  |   |            |   |   | 1,091,755 |  
|Issuance of Common Stock for Acquisition of
        Bio-Tracking (Note 6,7) |                     | 100,000,000 |        |   | 100,000                    |  |                                                          | 4,833,506 |                                  |   |            |   |   | 4,933,506 |  
|                                                                            |                     |             |        |   |                            |  |                                                          |           |                                  |   |            |   |   |           |  
|                                                                            |                     | 337,865,401 |        | $ | 337,866                    |  | $                                                        | 6,815,147 |                                  | $ | (2,190,860 | ) | $ | 4,962,153 |  





See notes to consolidated financial statements.

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##### Table of Contents

CHINA XIN NETWORK MEDIA CORPORATION AND SUBSIDIARY

(A DEVELOPMENT STAGE COMPANY)



CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS

Unaudited



|                                                                                 |  |                                        |            |                                        |   |                                              |   |   |            |  
|-------------------------------------------------------------------------------- |  | -------------------------------------- | ---------- | -------------------------------------- | - | -------------------------------------------- | - | - | ---------- | -
|                                                                                 |  | For the Period                         |            | For the Period                         |   | For the Period                               |  
|                                                                                 |  | January 1, 2004
        March 31, 2004 |            | January 1, 2003
        March 31, 2003 |   | Oct. 19, 2000
        March 31,
        2004 |  
|Cash Flows from Operating Activities:                                            |  |                                        |            |                                        |   |                                              |   |   |            |  
|Net loss                                                                         |  | $                                      | (50,002    | )                                      | $ | (331,384                                     | ) | $ | (2,190,860 | )
|Adjustments to reconcile net loss to net cash                                    |  |                                        |            |                                        |   |                                              |   |   |            |  
|provided by (used in) operating activities:                                      |  |                                        |            |                                        |   |                                              |   |   |            |  
|Depreciation and amortization                                                    |  |                                        |            |                                        |   | 15,675                                       |   |   |            |  
|(Increase) decrease in:                                                          |  |                                        |            |                                        |   |                                              |   |   |            |  
|R&D refundable tax credit                                                        |  |                                        |            |                                        |   |                                              |   |   | (212,308   | )
|Sales tax receivable                                                             |  |                                        | 6,388      |                                        |   | 7,860                                        |   |   |            |  
|Accrued expenses                                                                 |  |                                        |            |                                        |   | (4,875                                       | ) |   |            |  
|Accrued expenses to related parties                                              |  |                                        |            |                                        |   |                                              | ) |   |            |  
|Accounts payable (Note 5)                                                        |  |                                        | (302,872   | )                                      |   | 14,000                                       |   |   | 302,872    |  
|Prepaid and deposits                                                             |  |                                        |            |                                        |   | 979                                          |   |   |            |  
|Amounts due to officers                                                          |  |                                        | 135,505    |                                        |   | 38,334                                       |   |   | 38,463     |  
|Amounts due to officers and Employees                                            |  |                                        |            |                                        |   | 280,051                                      |   |   |            |  
|Loss on disposal of assets                                                       |  |                                        |            |                                        |   |                                              |   |   | 121,153    |  
|                                                                                 |  |                                        |            |                                        |   |                                              |   |   |            |  
|Net cash and cash equivalents provided by (used
        in) operating activities |  |                                        | (210,981   | )                                      |   | 21,090                                       |   |   | (1,940,270 | )
|                                                                                 |  |                                        |            |                                        |   |                                              |   |   |            |  
|Cash Flows from Investing Activities:                                            |  |                                        |            |                                        |   |                                              |   |   |            |  
|Purchase of Goodwill                                                             |  | $                                      | (4,562,020 | )                                      | $ |                                              |   | $ | (4,762,020 | )
|Purchase of Capital Assets                                                       |  |                                        |            |                                        |   | (21,389                                      | ) |   | (25,672    | )
|                                                                                 |  |                                        |            |                                        |   |                                              |   |   |            |  
|Net Cash Used For Investing Activities                                           |  | $                                      | (4,562,020 | )                                      |   | (21,389                                      | ) | $ | (4,787,692 | )
|                                                                                 |  |                                        |            |                                        |   |                                              |   |   |            |  
|Cash Flows from Financing Activities:                                            |  |                                        |            |                                        |   |                                              |   |   |            |  
|Write-off deficit to Paid-in-Capital                                             |  | $                                      |            |                                        | $ |                                              |   | $ | 139,877    |  
|Write-off comprehensive income to Paid Capital                                   |  |                                        |            |                                        |   |                                              |   |   | 10,807     |  
|Write-off stock subscription receivable                                          |  |                                        |            |                                        |   |                                              |   |   | 196,349    |  
|Decrease in short term loans                                                     |  |                                        |            |                                        |   |                                              |   |   |            |  
|(Decrease) in loans-related party                                                |  |                                        |            |                                        |   |                                              |   |   |            |  
|(Decrease) Increase in loans payable (Note 6)                                    |  |                                        | (868,579   | )                                      |   | (643,892                                     | ) |   |            |  
|Increase in capital stock                                                        |  |                                        | 197,480    |                                        |   | 35,483                                       |   |   | 332,549    |  
|Increase in paid-in capital                                                      |  |                                        | 5,439,716  |                                        |   | 608,409                                      |   |   | 6,048,996  |  
|                                                                                 |  |                                        |            |                                        |   |                                              |   |   |            |  
|Net Cash from Financing Activities                                               |  |                                        | 4,768,617  |                                        |   |                                              |   |   | 6,728,578  |  
|                                                                                 |  |                                        |            |                                        |   |                                              |   |   |            |  
|Net (Decrease) Increase in Cash                                                  |  |                                        | (4,384     | )                                      |   | (299                                         | ) |   | 616        |  
|Cash
        - Beginning of Period                                               |  |                                        | 5,000      |                                        |   | 469                                          |   |   |            |  
|                                                                                 |  |                                        |            |                                        |   |                                              |   |   |            |  
|Cash
        - End of Period                                                     |  |                                        | 616        |                                        |   | 170                                          |   |   | 616        |  
|                                                                                 |  |                                        |            |                                        |   |                                              |   |   |            |  
|Supplemental
        Disclosure of Non-Cash Flow Information:                    |  |                                        |            |                                        |   |                                              |   |   |            |  
|Cash paid during the year for::                                                  |  |                                        |            |                                        |   |                                              |   |   |            |  
|Interest                                                                         |  |                                        |            |                                        |   |                                              |   |   |            |  
|Income Taxes                                                                     |  |                                        |            |                                        |   |                                              |   |   |            |  
|                                                                                 |  |                                        |            |                                        |   |                                              |   |   |            |  
|                                                                                 |  |                                        |            |                                        |   |                                              |   |   |            |  





See notes to consolidated financial statements.



6

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CHINA XIN NETWORK MEDIA CORPORATION AND SUBSIDIARY

(A DEVELOPMENT STAGE COMPANY)

Notes to Consolidated Financial Statements





March 31, 2004

Unaudited



1. Background and organization



CHINA XIN NETWORK MEDIA CORPORATION is a
Florida-registered corporation. Until October 29, 2003 the registrant was
pursuing its business plan of developing a custom market research firm which
would provide business intelligence to Fortune 2000 companies seeking to enter
or enhance their market presence in the People's Republic of China, with its
partner, The China Economic Information Network (CEINet), an official government
agency of the State Development and Planning Commission.



On October 29, 2003 the registrant announced that it
would be seeking to mutually terminate its joint venture agreement with CEINet.
The board had agreed that this decision was necessary, due to CXN's continued
inability to meet its obligations under its agreement.



On December 2, 2003, the registrant, concluded the
acquisition of Montreal (Canada) based Bio-Tracking Security Inc.
(Bio-Tracking). Under the terms of the transaction, CXN acquires 100% of the
outstanding shares of the Bio-Tracking, in exchange for 100,000,000 shares of
CXN. As a result of this transaction Bio-Tracking is now a wholly-owned
subsidiary of CXN.



Bio-Tracking of Montreal, Quebec, designs and
manufactures vehicle and asset tracking and security systems, based on patented,
Inertial Navigation, Biometric Fingerprint Identification and Spread Spectrum
Communication technologies.



2. Accounting Policies



a) Basis of Presentation The Company is considered to be
a development stage company as of December 31, 2003 since planned principal
operations have not yet commenced.

b) Principles of Consolidation The accompanying
consolidated financial statements include the accounts of the Company from
October 19, 2000 and its wholly-owned subsidiary, CXN from October 19, 2000
herein after referred to together as the ( "Companies ") after
elimination of any significant intercompany transaction and accounts.

c) Cash and Cash Equivalent The Company considers highly
liquid investments with maturities of three months or less at the time of
purchase to be cash equivalents.

d) Furniture, Fixtures and Equipment Furniture, fixtures
and equipment are recorded at cost less accumulated depreciations which is
provided on the straight-line basis over the estimated useful lives of the
assets which range between three and seven years. Expenditures for maintenance
and repairs are expensed as incurred.

e) Income Taxes The Company accounts for income taxes in
accordance with the liability method of accounting for income taxes.
Accordingly, deferred tax assets and liabilities are determined based on the
difference between the financial statement and tax bases of assets and
liabilities, using the enacted tax rates in effect for the year in which the
differences are expected to reverse. Current income taxes are based on the
respective periods taxable income for federal, state and foreign income tax
reporting purposes. As at March  31, 2004, these amounts were Nil.

f) Earnings Per Share Earnings per common share is
computed pursuant to SFAS No. 128 Earnings Per Share . Basic earnings per share
is computed as net income (loss) available to common shareholders divided by the
weighted average number of common shares outstanding for the period. Diluted
earnings per share reflects the potential dilution that could occur from common
shares issueable through stock options, warrants and convertible preferred
stock.

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

h) Fair Value Disclosure at March 31, 2004 The carrying
value of recoverable use tax, accrued expenses related party, and loans from
related party is a reasonable estimate of their fair value.

i) Effect of New Accounting Standards The Company
does not believe that any recently issued accounting standards, not yet adopted
by the Company, will have a material impact on its financial position and
results of operations when adopted.

7

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##### Table of Contents

During June 2001, SFAS No. 141, Business Combinations was
issued. This standard addresses financial accounting and reporting for business
combinations. All business combinations within the scope of SFAS 141 are to be
accounted for using one method the purchase method. Use of the pooling-of-
interests methods is prohibited. The provisions of SFAS141 apply to all business
combinations initiated after June 30, 2001.



During June 2001, SFAS No. 142, Goodwill and Other
Intangible Assets was issued. This standard addresses how intangible assets that
are acquired individually or with a group of other assets (but not those
acquired in a business combination) should be accounted for in financial
statements upon their acquisition. SFAS No. 142 also addresses how goodwill and
other intangible assets should be accounted for after they have been initially
recognized in the financial statements. The provision of SFAS No. 142 is
effective for fiscal years beginning after December 15, 2001.



3. Going Concern



The Company 's financial statements are prepared using
generally accepted accounting principles to a going concern which contemplates
the realization of assets and liquidation of liabilities in the normal course of
business. The Company has not established revenues sufficient to cover its
operating costs and allow it to continue as a going concern. Until such time the
company is raising investments capital to cover its ongoing operating costs.



4. Provisions for Income Tax



Income taxes are provided for the tax effects of
transactions reported in the financial statements and consist of taxes currently
due plus deferred taxes related to differences between the financial statement
and income tax bases of assets and liabilities for financial statement and
income tax reporting purposes. Deferred tax assets and liabilities represent the
future tax return consequences of these temporary differences, which will either
be taxable or deductible in the year when the assets or liabilities are
recovered or settled. Accordingly, measurement of the deferred tax assets and
liabilities attributable to the book-tax basis differentials are computed by the
Company at a rate of approximately 34% for federal and 6% for state.



5. Commitments and Contingencies



Insurance

The Company does not maintain any property and general liability insurance. At
the date of the Balance Sheet, the Company is not aware of any claims.



Contingencies

On November 7, 2003, CXN entered into an agreement with 3884368 Canada Inc., one
of its major shareholders controlled by Jean-Francois Amyot. Under the terms of
the agreement, 3884368 Canada Inc., took full responsibility to settle CXN's
total liabilities totaling $974,700 USD.  CXN issued 97,470,000 shares to
3884368 Canada Inc. as settlement of debt on its balance sheet. The debt is
considered as a contingency to CXN until all outstanding claims are settled.

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##### Table of Contents

6. Reduction of Loan Outstanding



There were
100,000,000 restricted Shares issued on January 4, 2004 to complete The
acquisition of Bio-Tracking. At which time a note for $868,569 was cancelled
Which was issued as collateral until the shares were ready for delivery from the
Transfer agent. Furthermore the shares for the Agreement of the settlement of
Debts of CXN with 3884368 Canada Inc. were issued in January 2004.



7 . Goodwill



In July 2001,
the FASB issued Statement No. 141, Business Combinations. and No. 142, Goodwill
and Other Intangible Assets. Statement No. 141 supercedes the previous
accounting standard on business combinations, Accounting Principles Board
Opinion No. 16. and requires that all business combinations initiated after June
30, 2001 must be accounted by the purchase method. Statement No. 141 also
changes the requirements for recognizing assets as assets apart from goodwill in
business combinations accounted for by the purchase method for which the date of
the acquisition is July 1, 2001 or later. Under Statement No. 142, goodwill
acquired in a business combination for which the acquisition date is after June
30, 2001, should not be amortized, but should be tested for impairment in
accordance for the provisions of this accounting standard.



Goodwill is
the result of the acquisition of Bio-Tracking Security Inc. by the registrant on
December 2, 2003.  The closing price of the shares traded on December 2,
2003 was $0.05. The Goodwill is calculated as the excess of the fairvalue of the
acquisition (the purchase method) over its tangible assets.





8 . Subsequent Events



Significant Changes to Key Management and Share Capital
Management Changes



On March 10, 2004, a majority action of
shareholders of the registrant, was taken by shareholders representing a
majority of the outstanding shares of the corporation, in accordance to 607.0704
of the Florida Business Corporations Act, to nominate successor Members of the
Board of Directors for the ensuing year, namely; Mr. Michael G. Iafigliola, Mr.
Philippe Canning, Mr. Kerry Schacter and Ms. Angela Cabral. A Schedule 14C 
Information Statement was filed April 5, 2004.



Changes in Share Capital



At the time of
this filing there are an estimated 337,865,401 shares outstanding. The
registrant also has a commitment to issue 6,666,667 warrants exercisable at
$0.03 to subscribers of a private placement of April 2003. Furthermore the
original seed investors in CXN are owed 9,373,667 exercisable at $0.30. The
warrants expire 2 years following their registration.

9

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##### Table of Contents

ITEM 2.
            PLAN OF
OPERATION



The following discussion should be read in conjunction
with the financial statements and notes thereto included elsewhere in this Form
10-QSB and our Form 10-KSB for the year ended June 30, 2003. Historical results
and percentage relationships set forth in the statement of operations, including
trends that might appear, are not necessarily indicative of future operations.



Forward-Looking Statements

Except for historical and factual information, this document contains
"forward-looking statements"within the meaning of the Private
Securities Litigation Reform Act of 1995. These forward-looking statements
include statements that address activities, events or developments that we
expect, believe or anticipate will or may occur in the future, such as
predictions of future financial performance. All forward-looking statements are
based on assumptions made by us based on our experience and perception of
historical trends, current conditions, expected future developments and other
factors we believe are appropriate under the circumstances. These statements are
subject to numerous risks and uncertainties, many of which
are beyond our control, including our ability to maintain key products' sales or
effectively react to other risks described from time to time in our SEC filings.
No forward-looking statement can be guaranteed, and actual results may differ
materially from those projected. We undertake no obligation to publicly update
any forward-looking statement, whether as a result of new information, future
events or otherwise.



The Company

CHINA XIN NETWORK MEDIA CORPORATION is a
Florida-registered corporation. As previously reported in press releases dated
November 26, 2003 and December 2, 2003, the registrant, has concluded the
acquisition of Montreal (Canada) based Bio-Tracking Security Inc.(Bio-Tracking).
Under the terms of the transaction, CXN acquires 100% of the outstanding shares
of the Bio- Tracking, in exchange for 100,000,000 shares of CXN. The closing of
the transaction occurred December 2, 2003, as a result of which Bio-Tracking is
now a wholly-owned subsidiary of CXN.



Bio-Tracking designs and manufactures Vehicle/Asset
Tracking and Security Technology, based on a Patent Pending, Wireless
Interconnection Methods, Real-time Tracking, Driver Privledge Control, Remote
Shutdown, Lock/Unlock, GPS / Inertial Navigation, Biometric Fingerprint
Identification, Voice Communication and Spread Spectrum Communication.



At a shareholders' meeting on January 23, 2004, Mr.
Michael Tremis was appointed to the Board of Directors and nominated as
President, CEO and Chairman of CXN to lead the company. The registrant has
commenced the necessary filings to change its name to Bio-Tracking Security Inc.
and will be seeking to change its ticker symbol to better reflect it new name
and current business plan.

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Operations

The registrant operates its Bio-Tracking subsidiary from
Montreal, Canada at 3080 Brabant-Marineau, Montreal, Quebec, Canada, H4A 1K7.
The company has a new product and service offering in the field of vehicle
security which, once installed, becomes a platform for new in-vehicle
information, communication and entertainment products. In addition to effective
theft prevention, this platform demonstrates measurable value for the vehicle
owner, driver, dealership, manufacturer, insurance company and law enforcement
agency. Combining a programmable computer with a biometric identification
system, wireless interconnection methods and inertial tracking technology, the
system can offer such features as driver privilege control, remote shutdown and
unlock, and tracking under the most extreme circumstances. The antitheft system,
which has already been prototyped and field tested, far exceeds the
industry's current standard features, effectiveness, and overall value.
The next generation system can offer two-way messaging and remote diagnostics.



The registrant plans to fully launch its operations after
raising funds in the capital markets before the end of fiscal year and the
registrant plans to establish concurrently the necessary relationships for quick
market impact. Concentrating on customer markets in major metropolitan areas,
the focus will be divided into consumer sales through dealerships, fleet sales
through direct relationships, and the exploration of critical markets in cargo
logistics and construction equipment.



In order to gain maximum shareholder value, and address
 competitive factors. With a worldwide customer market including emerging
 opportunities in India and China, Bio- Tracking a has the potential to become
 one of the truly great players in the automotive and asset sector.



Mr. Michael Tremis has assembled a top notch management
team and a seasoned board of directors who will ensure that the business stays
on track and executes the strategic plans.



The following have been appointed t the management of the
corporation and or members of the Board.



Mr. Daniel Bernisi: Chief Scientific Officer

Mr. Daniel Bernesi is a graduate of the Universidad de la
Provincia de Buenos Aires in Argentina, where he earned his BSc in Electrical
Engineering and his post-graduate studies in Industrial Automation and
Telecommunication in, 1973. He is one of the pioneers and foremost authorities
in home satellite television systems. He lectured at international technical
conferences and was contributing writer to technical magazines on subjects as
interfering noise, computer satellite tracking and down-converter design. He has
been a design engineer and installation consultant for companies such as Comsat,
Amplica, Boman, Luxor, Scannar Satellite Systems and Suncor Communications. His
experience also includes the design and implementation of industrial automation
and system controls for companies such as Perkins Paper, Leviton, Bell Canada,
Mitec and LCT Industries.



Ms. Angela Cabral: Director and Executive Vice-President
of Human Resources

Ms. Cabral is a professional social worker and a member
of the Ordre Professionnel des Travailleurs Sociaux du Quebec. Ms. Cabral
provides front line social services as well as operates a private clinic and two
separate Employees Assistance Programs. In her work with employees she
specializes in conflict resolution and assisting employees in reaching their
full potential in their work environment.

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Mr. Philippe Canning, Barrister & Solicitor: Director
and Vice-President Legal and Corporate Affaires

Mr. Philippe Canning specializes in corporate and
securities law, also recognized for his near flawless mastery in commercial and
civil litigation. Mr. Canning counsels a diverse clientele, ranging from small
business to larger corporations and multinationals. He has successfully
represented clients such as "The Trane Company" and "Sherwin
Williams Group."Mr. Philippe Canning, LL.b., is a practicing attorney. He
earned his legal degree from the University of Montreal in 1992 and was called
to the Quebec Bar in 1993. Mr. Philippe Canning has been a partner of the firm
Issi Di Iorio Canning since 1996. Following a merger in 2001, the firm was
renamed Doyon Izii Nivoix.



Mr. Michael Iafigliola: Director and Chief Operations
Officer

Co-Founder, C.O.O. and Chairman of the Board for CRM
NETWORKS INC., a company contracted for Executive Sales to Group Telecom an
integrator of Data & Internet applications and Voice Services for MULTINET
COMMUNICATIONS, a NORTEL/MITEL distributor. Michael G. Iafigliola has extensive
experience as well as a solid understanding of monitoring and tracking systems
which ensure reliable security technologies.Michael G. Iafigliola also held
senior executive position with AVAYA COMMUNICATIONS (formerly of LUCENT
TECHNOLOGIES) offering voice/data services and hosted services to large
multi-national corporations in a direct sales effort. Also responsible in
working with re-seller channels, GROUP TELECOM and TELUS positioning hosted
solutions and equipment as an integrated part of the solution. Michael G.
Iafigliola was appointed Channel Sales Director with PYDERION CONTACT
TECHNOLOGIES INC. a developer of next generation, open software products for
Call Centers, Company was acquired by INTECOM CANADA in year 2000.Successfully
promoted an Alliance Agreement for consulting services as the premier alliance
partner for EContact Center business solutions with WILTEL COMMUNICATIONS and
GROUP TELECOM. Michael G. Iafigliola has over 12 years of major account selling
experience with TTS MERIDIAN SYSTEMS INC. (a NORTHERN TELECOM COMPANY, presently
TELUS a national telecommunication company, and AT&T CANADA ). As prime
co-ordinator in selling both local and national accounts with long term
contracts, he has achieved over $100 MILLION in sales. Along with 10% to 15%
increases in company profits he was also honoured with numerous awards in
"The Presidents Club" for excelled performance. Mr. Michael G.
Iafigliola earned a Bachelor of Commerce Degree, with a focus on Management and
Marketing from Concordia University in 1978.



Mr. Kerry Schacter: Director

Mr. Kerry Schacter is presently employed with the
prestigious firm Investpro Securities Inc. of Montreal where he focuses on
investing in emerging companies with unique products and an exceptional
management team. In his 10 year career, Mr. Schacter has taken part in projects
where ideas are taken from the early inception stages right through to public
listing on major North American Stock Exchanges (DOW, NASDAQ, AMEX, TSE). He has
successfully participated in raising over $ 55 MILLION in Capitol Pool, Bridge,
Equity, Financing, Tax Shelters, and IPO's.Mr. Kerry Schacter earned his
Bachelors of Administration from Concordia University of Montreal in 1991. He
has a background in investment, insurance and accounting, and prior to joining
Investpro Securities he served at National Bank Financial, First Marathon
Securities and Prudential Assurance.

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##### Table of Contents

Products



The Bio-Tracking technology is the result of an R&D
effort to build an asset tracking device that overcomes the fact that the
present track and recovery systems are either easy to defeat or they are
inherently dependent on external sources for pinpointing vehicle location.
Tracking alone is not the solution to the ever-increasing vehicle theft problem.
The addition of Biometric fingerprint identification technology brings in the
next level of security by providing identification first, and then followed by
allowing access to the vehicle's authorized users. Combined with stealth
wireless smart cut-off modules, it renders the vehicle practically impossible to
steal. The Bio-Tracking technology also has a remote control and logging system
which allows for selective driver authorization as well as the remote operation
of vehicle systems such as the starter, locks, horn and lights.



Three distinct models have been produced. The
"Warlock I , II , & III"models cover an unprecedented range of
security, tracking and information features that have yet to be achieved by any
existing systems on the market to date. Our second generation technology towers
ahead of the competition. We have revolutionized this technology to the point
where Bio-Tracking Securities Inc. has set new and higher standards in the
vehicle/asset security and tracking industry.



Warlock I

- Modified high security and reliability Biometrics
    Technology (Fingerprint Recognition)
- Advanced custom encryption algorithm (data
    scrambling) for maximum security
- Stealth wireless multiple Remote Cutoff modules
- Voice communication (four languages)
- Authorized Valet mode (limited distance)
- Anti-hijacking mode recognition (disables vehicle
    upon drivers abnormal exit)
- Vehicle shut-down (remote controlled from
    Bio-Tracking Head office)
- Lock/Unlock door activation (by remote or
    cell/telephone signal)
- Vehicle remote starting (by remote or cell/telephone
    signal)
- Driver authorized enrollment (remote controlled from
    Bio-Tracking Head office)
- Single/multiple/occasional driver authentication
- Driver log report available to insurance companies
    and authorities (from Bio-Tracking Head office)



Warlock II

All of Warlock I features plus:

- Real-time Vehicle Tracking using GPS assisted
    navigation.
- Stealth wireless tracking modules Panic button for
    medical, mechanical, or other emergency (911)
- Tracking resolution +/- 10 meters standard Vehicle
- Tamper notification pager



Warlock III

All of Warlock I & II features plus:

- Precision tracking resolution +/- 1 meter (optional
    increased precision)
- Full-time/Real-time continuous tracking (worldwide
    accessibility)
- Information and storage log of driver, accurate
    mileage, real-time speed by time and date (a Bio-Tracking vehicle/asset
    "Black Box"Technology)

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Capital Needs

CXN anticipates that it will be required to raise
an additional $4 million to fund the current plan of growth and existing
operations through June 30, 2005. The principal source of capital has been
equity financing from investors and founders. Meeting the future financing
requirements is dependent on access to equity capital markets. CXN may not be
able to raise additional equity when required or may have to borrow on terms
that may be dilutive to existing shareholders.



Results of Operations



|                               |  |                              |  |      |          |          |  |                
|------------------------------ |  | ---------------------------- |  | ---- | -------- | -------- |  | ---------------
|                               |  | Three Months Ended March 31,
|                               |  | 2004                         |  | 2003 |          | % Change
|Sales General & Administrative |  | $50,002                      |  |      | $331,384 |          |  | -
        84.9%
|Total                          |  | $                            |  |      | $        |          |  |                
|                               |  |                              |  |      |          |          |  |                



CXN has worked diligently to reduce overhead and expenses
while building shareholder value. As of March 31, 2004, expenses for Sales
General and Administrative expenses were $50,002 versus $331,384 a year ago
period. This represents a reduction of expenses of 84.9%



|                  |  | Three Months Ended
|----------------- |  | ------------------
|                  |  | March 31, 2004    
|Total Liabilities |  | $38,463           
|                  |  |                   



On March 31, 2004 the liabilities of the corporation were
reduced 97.1%  The loan payable of $868,579 which represents security for
the acquisition of Bio-Tracking was settled for the issuance of shares for the
acquisition. As well, shares were issued to 3884368 Canada Inc. as per the
agreement dated November 7, 2003 for the settling of debt.



The end result of these transactions, the Shareholders'
equity of CXN has increased to $4,962,153 from a deficit of $896,051.



Contingencies



On November 7, 2003, CXN entered into an agreement with
3884368 Canada Inc., one of its major shareholders controlled by Jean-Francois
Amyot. Under the terms of the agreement, 3884368 Canada Inc., took full
responsibility to settle CXN's total liabilities totalling $974,700 USD. CXN
issued 97,470,000 shares to 3884368 Canada Inc. as settlement of debt on its
balance sheet. The debt is considered as a contingency to CXN until all
outstanding claims are settled.

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##### Table of Contents

RISK FACTORS



The Company and our business continues to be subject to a
number of risk factors, including but not limited to the fluctuations in demand
for our product line due to economic conditions, a history of operating losses,
the need for additional funds, competition, and technological obsolescence.
Before deciding to invest in our company or to maintain or increase your
investment, you should carefully consider the risks contained in our Annual
Report on Form 10-KSB, our other Quarterly Reports on Form 10-QSB; and in our
other filings with the Securities and Exchange Commission, including any
subsequent reports filed on Forms 10-KSB, 10-QSB and 8-K. Additional risks and
uncertainties not presently known to us or that we currently deem immaterial may
also affect our business and results of operations. If any of these risks
actually occur, our business, financial condition or results of operations could
be seriously harmed. In that event, the market price for our common stock could
decline and you may lose all or part of your investment.



FACTORS THAT COULD AFFECT FUTURE RESULTS



Because of the following factors, as well as other
variables affecting our operating results, past financial performance may not be
a reliable indicator of future performance, and historical trends should not be
used to anticipate results or trends in future periods.



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##### Table of Contents

ITEM 3. CONTROLS AND
PROCEDURES



(a) Under the supervision and with the participation of
our management, including our Chief Executive Officer and Chief Financial
Officer, we conducted an evaluation of our disclosure controls and procedures,
as such term is defined under Rule 13a-14(c) promulgated under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), as of
March 31, 2004. Based on their evaluation, our Chief Executive Officer and Chief
Financial Officer concluded that the Company's disclosure controls and
procedures are effective.



(b) There have been no significant changes (including
corrective actions with regard to significant deficiencies or material
weaknesses) in our internal controls or in other factors that could
significantly affect these controls subsequent to the date of the evaluation
referenced in paragraph (a) above.



PART II. OTHER INFORMATION



ITEM 1. LEGAL
PROCEEDINGS



Not applicable



ITEM 2. CHANGES IN
SECURITIES AND SMALL BUSINESS ISSUER PURCHASES OF EQUITY SECURITIES



Not applicable

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##### Table of Contents

ITEM 6. EXHIBITS AND
REPORTS ON FORM 8-K



(a) Exhibits:



| | 31 | Rule
        13a-14(a)/15d-14(a) Certifications of the Chief
| | -- | ------------------------------------------------------------

| |  | Executive
        Officer and Chief Financial Officer
| |  | -----------------------------------------------------

| | 32.1 | Section
        1350 Certification of the Chief Executive Officer
| | ---- | -----------------------------------------------------------------

| | 32.2 | Section
        1350 Certification of the Chief Financial Officer
| | ---- | -----------------------------------------------------------------



(b) Reports on Form 8-K:



There are no reports on Form 8-K  filed
during the quarterly period ended March 31, 2004.



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SIGNATURES



In accordance with the requirements of the Exchange Act,
the small business issuer caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.



Date: May 18, 2004



CHINA XIN NETWORK MEDIA CORPORATION









|                                                                                                   
|---------------------------------------------------------------------------------------------------
|                                                                                                   
|                                                                                                   
|By: //s MICHAEL
        TREMIS                                                                     
|                                                                                                   
|Michael Tremis
        Chairman, President,  Chief Executive
        Officer
        & interim  CFO

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