--------------------------------------------------------------------------------

                     U.S. SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                  FORM 10-KSB/A

         [X] Annual report under Section 13 or 15 (d) of the Securities Exchange
             Act of 1934 (No fee required, effective October 7, 1996.)

                   For the fiscal year ended December 31, 2000

         [ ] Transition report under Section 13 or 15(d) of the Securities
             Exchange Act of 1934 (No fee required)

         For the transition period from _____________ to _____________ .

                         Commission file number 33-20582

                       Equity Technologies & Resources, Inc.
                 (Name of Small Business Issuer in Its Charter)

                  Delaware                                  75-2276137
      (State or Other Jurisdiction of                    (I.R.S. Employer
       Incorporation or Organization)                   Identification No.)

   1050 Chinoe Road, Suite 304, Lexington, Kentucky      40502
      (Address of Principal Executive Offices)         (Zip Code)

                                (859) 268-4446
                (Issuer's Telephone Number, Including Area Code)

         Securities registered under Section 12(b) of the Exchange Act:

                                      None

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

                 Class A Common Stock, par value $.001 per share
                                (Title of Class)

         Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that 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 [  ]

         Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B is not contained in this form, and no disclosure will
be contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [ ]

<PAGE>

Note 1:  Form 10K

         This form 10K reflects the audited financial statements of Equity
Technologies & Resources, Inc. for the year ended December 31, 2000 performed by
HJ & Associates, L.L.C. (formerly Jones, Jensen, and Company) of 50 South Main
Street, Suite 1450, Salt Lake City, Utah 84144.

         The issuer's revenues for the year ended December 31, 2000 were 0.

         The aggregate market value of the voting stock held by non-affiliates
computed by reference to the price at which the stock was sold, or the average
bid and asked prices of such stock, as of December 31, 2000 was $1,767,020.

         The number of shares outstanding of the issuer's common equity, as of
December 31, 2000 was 8,031,907 shares.

         Transitional  Small  Business  Disclosure  Format  (check one):
Yes [ ] No [X]

<PAGE>

                                     PART I

Item 1.  Business.

GENERAL

         Equity Technologies & Resources, Inc. ("Equity", or "the Company") is a
Delaware corporation, the successor to Equity AU, Inc., which was engaged in the
exploration and mining of certain minerals in Arkansas. The principal corporate
offices are now located at 1050 Chinoe Road, Suite 304, Lexington, Kentucky
40502 and its telephone number is (859) 268-4446. Equity AU, Inc. ceased all
mining activity in December 1996. The corporation changed its name to Equity
Technologies & Resources, Inc. in 2000 which was an integral part of the change
in focus of the Company. In December 2000 Verified Prescription Safeguards, Inc.
was acquired by Equity Technologies & Resources, Inc. It will be operated as a
wholly owned subsidiary as a solution provider for the prescription drug
industry.

HISTORY AND CURRENT ACTIVITY

         In February of 1995, then Chairman of the Company, James Arch ("Mr.
Arch") reached an agreement with a shareholder and investor, Stephen Guarino, to
invest significant equity capital into the Company. Mr. Arch thereafter granted
full management and financial control to Mr. Guarino. The then current
President, Kingman L. Hitz resigned, and all operations were moved to Mena,
Arkansas. Director Gail W. Holderman resigned shortly thereafter. Mr. Guarino
was appointed with the official title of President in May of 1995, and was also
appointed as a Director, along with William Hanlon and Roger Tichenor. Kingman
Hitz had not received notice of any meetings, and subsequently resigned as a
director in July of 1995. In early 1996, a partnership controlled by Mr. Arch
foreclosed on the Company's property and equipment which had been pledged for
loans received from the partnership.

         In June of 1996, Mr. Guarino, Mr. Hanlon, and Mr. Tichenor resigned all
of their positions with the Company, and Mr. Arch entered into agreements with
Mr. Guarino and Mr. Tichenor to purchase all of the Class A Common shares which
had been previously issued to them.

         Mr. Arch elected to resume operations at Mena, Arkansas on June 1,
1996. Ore production was commenced in early September, 1996. Management
determined that the operation could not be profitable and operations were
terminated.

                                       2
<PAGE>

         In November, 2000 Frank G. Dickey, Jr. was elected President of Equity
AU, Inc. Unable to find a suitable company for merger or acquisition, the
Company changed its name to Equity Technologies & Resources, Inc. and continued
to seek a merger or acquisition candidate. In December, 2000 Verified
Prescription Safeguards, Inc. was acquired. It will be operated as a wholly
owned subsidiary as a solution provider for the prescription drug industry.

Item 2.  Properties.

         The Company's executive offices are located at 1050 Chinoe Road, Suite
304, Lexington, Kentucky 40502. It's telephone number is (859) 268-4446.

         Title to certain tracts of land in Polk County, Arkansas are still
registered to Equity AU, Inc.

Item 3.  Legal Proceedings.

         There are no pending legal proceedings in which the Company is involved

Item 4.  Submission of Matters to a Vote of Security Holders.

         On July 21, 2000  the  Company   held  a special meeting  of
Shareholders and Directors. The record owners of more than eighty (80%) percent
of the outstanding shares of common stock approved a one to fifty (1:50) reverse
split of its outstanding Class A Common Stock. The reverse split was effected on
August 4, 2000.

Item 5.  Market for Common Equity & Related Stockholder Matters.

         The Class A Common Stock of Equity Technologies & Resources is
currently traded under the symbol "ETCR" on the OTC:BB exchange.

         As of the date hereof, the Company has not paid or declared any cash
dividends. The Company can give no assurance that it will generate future
earnings from which cash dividends can be paid. Future payment of dividends by
the Company, if any, is at the discretion of the Board of Directors and will
depend, among other criteria, upon the Company's earnings, capital requirements,
and its financial condition as well as other relative factors. Management has
followed the policy of retaining any and all earnings to finance the development
of its business. Such a policy is likely to be maintained as long as necessary
to provide working capital for the Company's operations.

RECENT SALES OF UNREGISTERED SECURITIES

         On August 7, 2000 the Company issued 6,000,000 shares to the President
of the Company for services rendered. The shares were exempt from registration
pursuant to Sections 4(2) or 3(b) under the Securities Act.

Item 6.  Management's Discussion & Analysis of Financial  Condition & Results of
Operations.

         Statements made or incorporated in this report include a number of
forward-looking statements within the meaning of Section 27(a) of the Securities
Act of 1933 and Section 21(e) of the Securities Exchange Act of 1934.
Forward-looking statements include, without limitation, statements containing
the words "anticipates", "believes", "expects", "intends", "future", and words
of similar import which express management's belief, expectations or intentions
regarding the Company's future performance or future events or trends. Reliance
should not be placed on forward-looking statements because they involve known
and unknown risks, uncertainties and other factors, which may cause actual
results, performance or achievements of the Company to differ materially from
anticipated future results, performance or achievements expressly or implied by
such forward-looking statements. In addition, the Company undertakes no
obligation to publicly update or revise any forward-looking statement, whether
as a result of new information, future events or otherwise.

                                       3
<PAGE>

RESULTS OF OPERATIONS

For the Year Ended December 31, 2000 compared to the Year Ended December 31,
1999.

         During the year ended December 31, 2000 the Company had no operations.
General and administrative expenses were $3,168,474 for the year of 2000.
Expenses include the rental of office space and consulting fees to keep the
corporation current. The Company recorded a net loss of $3,168,474in 2000,
compared to $178,877 in 1999.

For the Year Ended December 31, 1999 compared to the Year Ended December 31,
1998.

         During the year ended December 31, 1999 the Company had no operations.
General and administrative expenses increased $10,598, or 7%, to $157,286 during
fiscal 1999 from $146,688 during fiscal 1998. The Company experienced a net loss
of $178,877 in fiscal 1999 compared with a net loss of $150,823 in fiscal 1998.

LIQUIDITY AND CAPITAL RESOURCES

         At December 31, 2000, the Company had $4,712 in assets and total
stockholders deficit of $(1,259,303) compared with total assets of $1,011 and
total stockholders deficit of $(321,325) at December 31, 1999. The Company
borrowed $18,300 from the President and $121,300 from other sources for general
operating expenses. The President and others have been paying the expenses of
the Company until the company or its subsidiary can commence business. There is
no assurance that the President and others can or will, continue to fund the
company and no assurance as to when or if the company or its subsidiary will be
able to begin operations.

         At December 31, 2000, the Company had total assets of $4,712 and total
stockholders deficit of $(1,259,303) compared with total assets of $1,011 and
total stockholders deficit of $(321,335) at December 31, 1999.

Item 7.  Financial Statements and Supplementary Data.

         The Following financial statements and documents are filed herewith on
the pages listed below, as part of Item 7 of this report.

              Document ............................................     Page

              Balance Sheet........................................     F-4

              Statement of Operations..............................     F-5

              Statement of Stockholder's Equity....................    F-6 to 10

              Statement of Cash Flows..............................    F-11,12

              Notes to Financial Statements........................   F-13 to 20

Item 8.  Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.

         There have been no changes in or disagreements with Accountants on any
accounting or financial disclosure matters. The Financial Statements have been
audited by HJ & Associates, LLC, 50 South Main Street, Suite 1450, Salt Lake
City, Utah 84144.

                                      4
<PAGE>

              EQUITY TECHNOLOGIES & RESOURCES, INC. AND SUBSIDIARY
                          (A Development Stage Company)
                        CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2000


                                      F-1
<PAGE>

                                 C O N T E N T S

Independent Auditors' Report............................................ F-3

Consolidated Balance Sheet.............................................. F-4

Consolidated Statements of Operations................................... F-5

Consolidated Statements of Stockholders' Equity (Deficit)............... F-6

Consolidated Statements of Cash Flows................................... F-11

Notes to the Consolidated Financial Statements.......................... F-13


                                      F-2
<PAGE>

                          INDEPENDENT AUDITORS' REPORT

To the Board of Directors
Equity Technologies & Resources, Inc. and Subsidiary
(A Development Stage Company)
Lexington, Kentucky

We  have  audited  the  accompanying   consolidated   balance  sheet  of  Equity
Technologies & Resources,  Inc. and Subsidiary (a development  stage company) as
of December  31, 2000 and the related  consolidated  statements  of  operations,
stockholders' equity (deficit),  and cash flows for the years ended December 31,
2000 and 1999 and from  inception  of the  development  stage on January 1, 1994
through  December 31, 2000.  These  consolidated  financial  statements  are the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these consolidated financial statements based on our audits.

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

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material respects,  the consolidated financial position of Equity
Technologies & Resources,  Inc. and Subsidiary (a development  stage company) as
of December 31, 2000 and the consolidated  results of their operations and their
cash flows for the years ended December 31, 2000 and 1999, and from inception of
the development stage on January 1, 1994 through December 31, 2000 in conformity
with generally accepted accounting principles.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 7 to the
consolidated  financial  statements,  the Company is a development stage company
with  recurring  losses  which  raises  substantial  doubt  about its ability to
continue as a going concern.  Management's  plans in regard to these matters are
also described in Note 7. The consolidated  financial  statements do not include
any adjustments that might result from the outcome of this uncertainty.

HJ & Associates, LLC
Salt Lake City, Utah
April 14, 2001

                                      F-3
<PAGE>
<TABLE>
<CAPTION>
                               EQUITY TECHNOLOGIES & RESOURCES, INC. AND SUBSIDIARY
                                           (A Development Stage Company)
                                            Consolidated Balance Sheet

                                                      ASSETS

                                                                                                  December 31,
                                                                                                     2000
                                                                                               -----------------
<S>                                                                                            <C>
CURRENT ASSETS
   Cash                                                                                        $             653
   Notes receivable, net                                                                                   4,059
                                                                                               -----------------

     Total Current Assets                                                                                  4,712
                                                                                               -----------------

     TOTAL ASSETS                                                                              $           4,712
                                                                                               =================


                                  LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES
   Accounts payable                                                                            $         103,584
   Accrued expenses                                                                                      690,831
   Dividends payable (Note 5)                                                                             30,000
   Notes payable (Note 4)                                                                                122,900
   Notes payable - related party (Note 4)                                                                316,700
                                                                                               -----------------
     Total Current Liabilities                                                                         1,264,015
                                                                                               -----------------
     Total Liabilities                                                                                 1,264,015
                                                                                               -----------------

CONTINGENCIES AND COMMITMENTS (Note 2)

STOCKHOLDERS' EQUITY (DEFICIT)
   Preferred stock, Class A, $1.00 par value, 2,000,000 shares
    authorized, 50,000 shares issued and outstanding                                                      50,000
   Preferred stock, Class B, $1.00 par value, 300,000 shares
    authorized, 40,000 shares issued and outstanding                                                      40,000
   Preferred stock, Class C, $1.00 par value, 100,000 shares
    authorized, -0- shares issued and outstanding                                                         -
   Common stock, Class A, $0.001 par value, 99,900,000 shares
    authorized, 2,121,907 shares issued and outstanding                                                    2,122
   Common stock, Class B, $0.01 par value, 100,000 shares
    authorized, 100,000 shares issued and outstanding                                                      1,000
   Additional paid-in capital                                                                         14,628,730
   Accumulated deficit prior to the development stage                                                 (8,390,740)
   Deficit accumulated during the development stage                                                   (7,590,415)
                                                                                               -----------------
     Total Stockholders' Equity (Deficit)                                                             (1,259,303)
                                                                                               -----------------
     TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)                                      $           4,712
                                                                                               =================
</TABLE>
        The accompanying notes are an integral part of these consolidated
                             financial statements.

                                      F-4
<PAGE>
<TABLE>
<CAPTION>
                               EQUITY TECHNOLOGIES & RESOURCES, INC. AND SUBSIDIARY
                                           (A Development Stage Company)
                                       Consolidated Statements of Operations


                                                                                                       From
                                                                                                  Inception of the
                                                                                                    Development
                                                                                                      Stage
                                                                  For the Years Ended              on January 1,
                                                                      December 31,                 1994 Through
                                                        --------------------------------------      December 31,
                                                                2000                1999                2000
                                                        ------------------  ------------------  ------------------
<S>                                                     <C>                 <C>                 <C>
REVENUES                                                $           -       $           -       $           -
                                                        ------------------  ------------------  ------------------
EXPENSES
   General and administrative                                    3,168,474             157,285           3,550,378
                                                        ------------------  ------------------  ------------------
     Total Expenses                                              3,168,474             157,285           3,582,846
                                                        ------------------  ------------------  ------------------
LOSS FROM OPERATIONS                                            (3,168,474)           (157,285)         (3,582,846)
                                                        ------------------  ------------------  ------------------
OTHER INCOME (EXPENSE)
   Interest income                                                      59              -                       59
   Interest expense                                                (44,700)            (21,592)            (75,533)
                                                        ------------------  ------------------  ------------------
     Total Other Income (Expense)                                  (44,641)            (21,592)            (75,474)
                                                        ------------------  ------------------  ------------------
LOSS BEFORE DISCONTINUED
 OPERATIONS                                                     (3,213,115)           (178,877)         (3,625,852)

LOSS ON DISCONTINUED
 OPERATIONS                                                         -                   -               (3,870,504)
                                                        ------------------  ------------------  ------------------
NET LOSS                                                $       (3,213,115) $         (178,877) $       (7,496,356)
                                                        ==================  ==================  ==================
BASIC LOSS PER SHARE                                    $            (2.34) $            (0.90)
                                                        ==================  ==================
WEIGHTED AVERAGE NUMBER OF
 COMMON SHARES OUTSTANDING                                       1,371,955             199,447
                                                        ==================  ==================
</TABLE>
        The accompanying notes are an integral part of these consolidated
                             financial statements.

                                      F-5
<PAGE>
<TABLE>
<CAPTION>
                               EQUITY TECHNOLOGIES & RESOURCES, INC. AND SUBSIDIARY
                                           (A Development Stage Company)
                             Consolidated Statements of Stockholders' Equity (Deficit)
                  From Inception of the Development Stage on January 1, 1994 to December 31, 2000


                                       Preferred Stock - A          Preferred Stock - B            Preferred Stock - C
                                 ----------------------------   ----------------------------   ---------------------------
                                     Shares          Amount         Shares          Amount        Shares          Amount
                                 ------------    ------------   ------------    ------------   -----------   -------------
<S>                              <C>             <C>             <C>            <C>             <C>          <C>
Balance, January 1, 1994              148,000    $    148,000         78,500    $     78,500        -        $      -

Preferred stock issued for
 cash at $1.00 per share               -               -             203,500         203,500         6,000           6,000

Preferred stock issued for
 services at $1.00 per share           -               -               6,200           6,200         4,200           4,200
                                 ------------    ------------   ------------    ------------   -----------   -------------
Balance
 December 31, 1994                    148,000         148,000        288,200         288,200        10,200          10,200
                                 ------------    ------------   ------------    ------------   -----------   -------------
Balance
 December 31, 1995                    148,000         148,000        288,200         288,200        10,200          10,200
                                 ------------    ------------   ------------    ------------   -----------   -------------
Balance
 December 31, 1996                    148,000         148,000        288,200         288,200        10,200          10,200

Shares converted to
 Class A common stock                  -               -              (5,000)         (5,000)       -               -

Shares converted to
 Class A common stock                  -               -             (11,000)        (11,000)       -               -

Canceled shares                       (98,000)        (98,000)      (272,200)       (272,200)      (10,200)        (10,200)
                                 ------------    ------------   ------------    ------------   -----------   -------------
Balance
 December 31, 1997                     50,000          50,000         -               -             -               -
                                 ------------    ------------   ------------    ------------   -----------   --------
Balance,
 December 31, 1998                     50,000          50,000         -               -             -               -
                                 ------------    ------------   ------------    ------------   -----------   --------
Balance,
 December 31, 1999                     50,000          50,000         -               -             -               -
                                 ------------    ------------   ------------    ------------   -----------   --------
Shares issued as
 consideration for purchase
 of subsidiary (Note 1)                -               -              40,000          40,000        -               -
                                 ------------    ------------   ------------    ------------   -----------   --------
Balance,
 December 31, 2000                     50,000    $     50,000         40,000    $     40,000   $    -        $      -
                                 ============    ============   ============    ============   ===========   ========
</TABLE>

        The accompanying notes are an integral part of these consolidated
                             financial statements.

                                      F-6
<PAGE>
<TABLE>
<CAPTION>
                                    EQUITY TECHNOLOGIES & RESOURCES, INC. AND SUBSIDIARY
                                                (A Development Stage Company)
                            Consolidated Statements of Stockholders' Equity (Deficit) (Continued)
                       From Inception of the Development Stage on January 1, 1994 to December 31, 2000




                                        Class A Common                 Class B Common          Additional
                                 ----------------------------   ----------------------------     Paid-in       Accumulated
                                    Shares           Amount        Shares           Amount       Capital         Deficit
                                 ------------    ------------   ------------    ------------  -------------      -------
<S>                                 <C>          <C>                 <C>        <C>           <C>            <C>
Balance
 January 1, 1994                       11,425    $         12        100,000    $      1,000  $  11,217,192  $  (8,390,740)

Common stock issued for
 services at $135.87 per share            700               1         -               -              95,105         -

Common stock issued for
 services at $499.70 per share             92          -              -               -              45,979         -

Common stock issued for
 dividends at $553.66 per share            32          -              -               -              17,717         -

Net loss for the year ended
 December 31, 1994                     -               -              -               -              -          (3,563,526)
                                 ------------    ------------   ------------    ------------  -------------  -------------
Balance,
 December 31, 1994                     12,249              13        100,000           1,000     11,375,993    (11,954,266)

Common stock issued for
 cash at $34.02 per share               5,416               5         -               -             184,295         -

Common stock issued for
 services at $52.50 per
 share                                    500          -              -               -              26,250         -

Common stock issued for
 dividends at $553.66 per
 share                                     32          -              -               -              17,717        (17,717)

Common stock issued for
 dividends at $548.15 per
 share                                     27          -              -               -              14,800        (14,800)

Net loss for the year ended
 December 31, 1995                     -               -              -               -              -            (212,633)
                                 ------------    ------------   ------------    ------------  -------------  -------------
Balance,
 December 31, 1995                     18,224              18        100,000           1,000     11,619,055    (12,199,416)

Net loss for the year ended
 December 31, 1996                     -               -              -               -              -             (61,828)
                                 ------------    ------------   ------------    ------------  -------------  -------------
Balance
 December 31, 1996                     18,224    $         18        100,000    $      1,000  $  11,619,055  $ (12,261,244)
                                 ------------    ------------   ------------    ------------  -------------  -------------
</TABLE>
        The accompanying notes are an integral part of these consolidated
                             financial statements.

                                      F-7
<PAGE>
<TABLE>
<CAPTION>
                                    EQUITY TECHNOLOGIES & RESOURCES, INC. AND SUBSIDIARY
                                                (A Development Stage Company)
                            Consolidated Statements of Stockholders' Equity (Deficit) (Continued)
                       From Inception of the Development Stage on January 1, 1994 to December 31, 2000




                                        Class A Common                 Class B Common          Additional
                                 ----------------------------   ----------------------------     Paid-in       Accumulated
                                    Shares           Amount        Shares           Amount       Capital         Deficit
                                 ------------    ------------   ------------    ------------  -------------      -------
<S>                                 <C>          <C>                 <C>        <C>           <C>            <C>
Balance
 December 31, 1996                     18,224    $         18        100,000    $      1,000  $  11,619,055  $ (12,261,244)

Stock issued in exchange
 for preferred B stock at
 $312.50 per share                         16          -              -               -               5,000         -

Fractional shares issued                    6          -              -               -                   1         -

Stock issued for services
 at $3.00 per share                     4,000               4         -               -              11,996         -

Stock issued for debt
 at $10.00 per share                    5,150               5         -               -              51,495         -

Stock issued for services
 at $4.95 per share                    20,590              21         -               -             101,979         -

Stock issued for services
 at $3.00 per share                       400          -              -               -               1,200         -

Stock issued in exchange
 for preferred B stock
 at $343.75 per share                      32          -              -               -              11,000         -

Contributed capital on

 cancellation of shares                  (168)         -              -               -             388,793         -

Net loss for the year ended
 December 31, 1997                     -               -              -               -              -            (115,504)
                                 ------------    ------------   ------------    ------------  -------------  -------------
Balance
 December 31, 1997                     48,250    $         48        100,000    $      1,000  $  12,190,519  $ (12,376,748)
                                 ------------    ------------   ------------    ------------  -------------  -------------
</TABLE>
        The accompanying notes are an integral part of these consolidated
                             financial statements.

                                      F-8
<PAGE>
<TABLE>
<CAPTION>
                                    EQUITY TECHNOLOGIES & RESOURCES, INC. AND SUBSIDIARY
                                                (A Development Stage Company)
                            Consolidated Statements of Stockholders' Equity (Deficit) (Continued)
                       From Inception of the Development Stage on January 1, 1994 to December 31, 2000




                                        Class A Common                 Class B Common          Additional
                                 ----------------------------   ----------------------------     Paid-in       Accumulated
                                    Shares           Amount        Shares           Amount       Capital         Deficit
                                 ------------    ------------   ------------    ------------  -------------      -------
<S>                                 <C>          <C>                 <C>        <C>           <C>            <C>
Balance
 December 31, 1997                     48,250    $         48        100,000    $      1,000  $  12,190,519  $ (12,376,748)

Reversal of cancellation of
 common A shares                        4,280               4         -               -                  (4)        -

Shares issued at $3.15 per
 share to repay note payable            1,737               2         -               -               5,468         -

Shares issued to officer at
 $3.15 per shares for consulting
 services rendered                        137          -              -               -                 431         -

Shares issued at $3.15 per
 share to officer for consulting
 services rendered                     22,480              22         -               -              71,132         -

Shares issued at $3.15 per
 share to officer for consulting
 services rendered                      2,563               3         -               -               8,080         -

Shares issued to officer to
 pay off note payable for
 consulting services rendered         120,000             120         -               -              58,338         -

Net loss for the year ended
 December 31, 1998                     -               -              -               -              -            (150,873)
                                 ------------    ------------   ------------    ------------  -------------  -------------
Balance, December 31, 1998            199,447             199       100,000            1,000     12,333,964    (12,527,621)

Net loss for the year ended
 December 31, 1999                     -               -              -               -              -            (178,877)
                                 ------------    ------------   ------------    ------------  -------------  -------------
Balance, December 31, 1999            199,447             199        100,000           1,000     12,333,964    (12,706,498)

Common stock issued at
 $7.00 for services rendered          166,628             168         -               -            1,166,230        -

Common stock issued for
services at $0.14 per share           550,000             550         -               -              76,450         -

Common shares canceled             (6,000,000)         (6,000)        -               -             (52,458)       (61,542)

Common stock issued for
 services at $0.14 per share        6,000,000           6,000         -               -             834,000         -

Fractional shares issued                  832          -              -               -              -              -
                                 ------------    ------------   ------------    ------------  -------------  --------
Balance Forward                       916,907    $        917        100,000    $      1,000  $  14,358,186  $ (12,768,040)
                                 ------------    ------------   ------------    ------------  -------------  -------------
</TABLE>
        The accompanying notes are an integral part of these consolidated
                             financial statements.

                                      F-9
<PAGE>
<TABLE>
<CAPTION>
                                    EQUITY TECHNOLOGIES & RESOURCES, INC. AND SUBSIDIARY
                                                (A Development Stage Company)
                            Consolidated Statements of Stockholders' Equity (Deficit) (Continued)
                       From Inception of the Development Stage on January 1, 1994 to December 31, 2000




                                        Class A Common                 Class B Common          Additional
                                 ----------------------------   ----------------------------     Paid-in       Accumulated
                                    Shares           Amount        Shares           Amount       Capital         Deficit
                                 ------------    ------------   ------------    ------------  -------------      -------
<S>                                 <C>          <C>                 <C>        <C>           <C>            <C>
Balance Forward                       916,907    $        917        100,000    $      1,000  $  14,358,186  $ (12,768,040)

Common shares issued for
 services at $0.14 per share          800,000             800         -               -             111,200         -

Common shares canceled               (120,000)           (120)        -               -                 120         -

Common shares canceled               (100,000)           (100)        -               -                 100         -

Common stock issued for
 services at $0.29 per share          275,000             275         -               -              79,475         -

Preferred shares issued
as consideration for purchase
of subsidiary                                 -                 -     -               -             (40,000)        -

Common stock issued for
 cash at $0.25 per share               90,000              90         -               -              22,410         -

Common shares issued for
 services at $0.375 per share         100,000             100         -               -              37,399         -

Common stock issued for
 services at $0.375 per share         160,000             160         -               -              59,840         -

Net loss for the year ended
 December 31, 2000                     -               -              -               -              -          (3,213,115)
                                 ------------    ------------   ------------    ------------  -------------  -------------
Balance, December 31, 2000          2,121,907    $      2,122        100,000    $      1,000  $  14,628,730  $ (15,981,155)
                                 ============    ============   ============    ============  =============  =============
</TABLE>
        The accompanying notes are an integral part of these consolidated
                             financial statements.

                                      F-10
<PAGE>
<TABLE>
<CAPTION>
                               EQUITY TECHNOLOGIES & RESOURCES, INC. AND SUBSIDIARY
                                           (A Development Stage Company)
                                       Consolidated Statements of Cash Flows


                                                                                                     From
                                                                                                 Inception of the
                                                                                                    Development
                                                                                                      Stage
                                                                  For the Years Ended              on January 1,
                                                                     December 31,                  1994 Through
                                                        --------------------------------------      December 31,
                                                                2000                1999                2000
                                                        ------------------  ------------------  ------------------
<S>                                                     <C>                 <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net loss                                             $       (3,213,115) $         (178,877) $       (7,590,415)
   Adjustments to reconcile net loss to
    net cash used by operating activities:
     Common stock issued for services                            2,372,646              -                2,657,463
     Preferred stock issued for services                            -                   -                   10,400
     Depreciation and amortization                                  -                   -                   70,532
     Bad debt expense                                                7,000              -                  136,240
     Discontinued operations                                        -                   -                2,820,586
   Changes in operating assets and liabilities:
   Decrease in accounts receivable                                  -                   -                   20,921
   Increase (decrease) in accounts payable                         659,160              18,027             752,178
   Increase (decrease) in accrued expenses                          40,410              26,537             102,673
                                                        ------------------  ------------------  ------------------
     Net Cash Used by Operating Activities                        (133,899)           (134,313)         (1,019,422)
                                                        ------------------  ------------------  ------------------

CASH FLOWS FROM INVESTING ACTIVITIES
   Increase in notes receivable                                    (11,059)             -                  (11,059)
   Purchase of equipment                                            -                   -                   (3,201)
   Sale of land                                                     -                   -                   64,000
                                                        ------------------  ------------------  ------------------
     Net Cash Provided by Investing Activities                     (11,059)             -                   49,740
                                                        ------------------  ------------------  ------------------

CASH FLOWS FROM FINANCING ACTIVITIES
   Sale of common stock for cash                                    22,500              -                  310,300
   Sale of preferred stock                                          -                   -                  209,500
   Proceeds from long-term debt                                    132,100             130,500             466,035
   Principle payments on long-term debt                            (10,000)             -                  (15,500)
                                                        ------------------  ------------------  ------------------
     Net Cash Provided by Financing Activities                     144,600             130,500             970,335
                                                        ------------------  ------------------  ------------------

NET INCREASE (DECREASE) IN CASH                                       (358)             (3,813)                653

CASH AT BEGINNING OF PERIOD                                          1,011               4,824              -
                                                        ------------------  ------------------  -------------

CASH AT END OF PERIOD                                   $              653  $            1,011  $              653
                                                        ==================  ==================  ==================
</TABLE>
        The accompanying notes are an integral part of these consolidated
                             financial statements.

                                      F-11
<PAGE>
<TABLE>
<CAPTION>
                               EQUITY TECHNOLOGIES & RESOURCES, INC. AND SUBSIDIARY
                                           (A Development Stage Company)
                                 Consolidated Statements of Cash Flows (Continued)


                                                                                                     From
                                                                                                 Inception of the
                                                                                                    Development
                                                                                                      Stage
                                                                  For the Years Ended              on January 1,
                                                                     December 31,                  1994 Through
                                                        --------------------------------------      December 31,
                                                                2000                1999                2000
                                                        ------------------  ------------------  ------------------
<S>                                                     <C>                 <C>                 <C>
Cash paid during the year for:
   Interest                                             $           -       $           -       $            8,509
   Income taxes                                         $           -       $           -       $           -

NON-CASH FINANCING:
   Common stock issued for services                     $        2,372,646  $           -       $        2,657,463
   Preferred stock issued for services                  $           -       $           -       $           10,400
   Common stock issued for dividends                    $           -       $           -       $           50,234
   Paid-in capital through cancellation of
    preferred stock                                     $           -       $           -       $          380,400
   Common stock issued for debt                         $           -       $           -       $          115,428
</TABLE>

        The accompanying notes are an integral part of these consolidated
                             financial statements.

                                      F-12
<PAGE>

              EQUITY TECHNOLOGIES & RESOURCES, INC. AND SUBSIDIARY
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                           December 31, 2000 and 1999

NOTE 1 -      NATURE OF ORGANIZATION

              The  consolidated  financial  statements  presented  are  those of
              Equity  Technologies  &  Resources,   Inc.  and  its  wholly-owned
              subsidiary,  Verified Prescription Safeguards,  Inc. Collectively,
              they are  referred  to herein as "the  Company."  The  Company was
              organized  on March 4, 1988 as a  Delaware  corporation  under the
              name Sherry Lynn  Corporation.  The  Company  was  organized  as a
              public  company for the purpose of finding a suitable  combination
              partner.

              On December 6, 1988, the Company  changed its name to Equity Gold,
              Inc. The number of shares of common stock  authorized to be issued
              changed from 50,000,000 to 150,000,000  with a par value of $0.001
              per share of common stock.

              On December 14, 1989, the Company merged with Gold Equity, Inc., a
              Delaware  corporation.  The surviving corporation was Equity Gold,
              Inc.

              On  February 7, 1989,  the Company  changed its name to Equity AU,
              Inc.

              On April 14, 1989,  the Company  changed the number of  authorized
              shares of common stock to 99,900,000.

              On November 7, 1991, the Company  authorized  2,000,000  shares of
              preferred stock with a par value of $1.00 each.

              On February 19, 1992, the Company authorized  99,900,000 shares of
              Class A common  shares  with a par value of $0.001 per share.  The
              Company  authorized 100,000 shares of Class B common shares with a
              par value of $0.01 per share.

              In January 2000, the Company changed its name from Equity AU, Inc.
              to Equity Technologies & Resources, Inc.

              The Company  engaged in research and  development  of a process to
              extract gold and other precious  metals on various real properties
              located in Arkansas. Partnerships were formed prior to 1994 by the
              Company or by affiliates of the Company to raise working  capital,
              acquire  mineral claims,  rights,  facilities and equipment and to
              explore for precious metals.  In 1994, the Company was notified by
              general partners of the partnerships that they were terminated and
              dissolved.

              On December  15,  2000,  the Company  acquired  all the issued and
              outstanding common stock of Verified Prescription Safeguards, Inc.
              ("VPS") in exchange  for 40,000  shares of the  Company's  Class-B
              voting  preferred stock. At the time the purchase was consummated,
              VPS held no assets or liabilities. The consolidated entity elected
              to change its business plan toward the  development  and marketing
              of internet  prescription drug technology.  Management  intends to
              use the majority of funds obtained  toward this  development.  The
              purchase price of the acquired subsidiary was determined among the
              parties to be 40,000 shares of Class-B preferred stock, redeemable
              at $500 per share  ($20,000,000).  The preferred shares issued are
              redeemable  for cash only at $500 per share,  payable  from 50% of
              net  revenues  of the  subsidiary  for the next seven  years.  The
              conversion  feature of the issued  preferred shares allows them to
              be converted into cash, pursuant to future revenues,  but does not
              allow them to be converted into common stock at any time.

              Since no revenues  have been  generated  and payment is to be paid
              from  future  revenues,  the  acquisition  was  recorded at a $-0-
              value.  The  Company is  contingently  liable for the  $20,000,000
              purchase price if sufficient  revenues are generated.  If and when
              the  liability is recorded in the future,  corresponding  goodwill
              will also be recorded.

                                      F-13
<PAGE>

              EQUITY TECHNOLOGIES & RESOURCES, INC. AND SUBSIDIARY
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                           December 31, 2000 and 1999


NOTE 2 -      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

              a.  Accounting Method

              The Company's consolidated financial statements are prepared using
              the  accrual  method of  accounting.  The  Company  has  elected a
              December 31 year end.

              b.  Use of Accounting Estimates

              The preparation of consolidated financial statements in conformity
              with generally accepted accounting  principles requires management
              to make certain  estimates and assumptions that affect the amounts
              reported in the consolidated financial statements and accompanying
              notes. Actual results could differ from those estimates.

              c.  Basic Loss Per Share

              The  computation  of basic loss per share of common stock is based
              on the weighted  average number of shares  outstanding  during the
              period of the  consolidated  financial  statements.  The Company's
              preferred  shares have been  excluded  from the basic net loss per
              share calculation as they are antidilutive.

                                   For the Year Ended
                                   December 31, 2000
              ---------------------------------------------------------
                    Loss                Shares             Per Share
                   (Numerator)         (Denominator)        Amount

              $       (3,213,115) $        1,371,955  $            (2.34)
              ==================  ==================  ==================


                                    For the Year Ended
                                     December 31, 1999
              ---------------------------------------------------------
                    Loss                Shares             Per Share
                   (Numerator)         (Denominator)        Amount

              $         (178,877)            199,447  $            (0.90)
              ==================  ==================  ==================


              d.  Provision for Taxes

              At  December  31,  2000,   the  Company  had  net  operating  loss
              carryforwards  of  approximately  $7,600,000  that  may be  offset
              against  future  taxable  income through 2020. No tax benefits has
              been reported in the consolidated  financial  statements,  because
              the potential tax benefits of the net operating loss carryforwards
              are offset by a valuation allowance of the same amount.

                                      F-14
<PAGE>

              EQUITY TECHNOLOGIES & RESOURCES, INC. AND SUBSIDIARY
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                           December 31, 2000 and 1999


NOTE 2 -      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

              d.  Provision for Taxes (continued)

              Deferred tax assets (liabilities) are comprised of the following:
<TABLE>
<CAPTION>
                                                                                   For the Years Ended
                                                                                       December 31,
                                                                          --------------------------------------
                                                                                 2000               1999
                                                                          ------------------   -----------------
              <S>                                                         <C>                  <C>
              Income tax benefit at statutory rate                        $        2,888,000   $       1,667,016
              Change in valuation allowance                                       (2,888,000)         (1,667,016)
                                                                          ------------------   -----------------
                                                                          $           -        $          -
                                                                          ==================   =================
<CAPTION>
              The income tax benefit differs from the amount computed at federal
              statutory rates of approximately 38% as follows:
                                                                                     For the Years Ended
                                                                                        December 31,
                                                                          --------------------------------------
                                                                                 2000               1999
                                                                          ------------------   -----------------
              <S>                                                         <C>                  <C>
              Income tax benefit at statutory rate                        $        1,220,984   $          67,973
              Change in valuation allowance                                       (1,220,984)            (67,973)
                                                                          ------------------   -----------------
                                                                          $           -        $          -
                                                                          ==================   ==================
</TABLE>
              e.  Revenue Recognition

              The Company  currently has no ongoing source of revenues.  Revenue
              recognition  policies will be determined when principal operations
              begin.

              f.  Principles of Consolidation

              The accompanying  consolidated  financial statements include those
              of Equity  Technologies  & Resources,  Inc.  and its  wholly-owned
              subsidiary,    Verified   Prescription   Safeguards,    Inc.   All
              intercompany accounts and transactions have been eliminated.

              g.  Cash and Cash Equivalents

              For  purposes of  financial  statement  presentation,  the Company
              considers all highly liquid  investments  with a maturity of three
              months or less, from the date of purchase to be cash equivalents.

                                      F-15
<PAGE>

              EQUITY TECHNOLOGIES & RESOURCES, INC. AND SUBSIDIARY
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                           December 31, 2000 and 1999

NOTE 3  -     CONTINGENCIES AND COMMITMENTS

              The Company owed $65,300 as of December 31, 2000 in federal taxes.
              Penalties  and  interest   continue  to  accrue.   Management  has
              determined that this will have no significant or material  adverse
              effect on the results of operations.

              On December 31, 1997,  the Company  canceled 168 Class A shares of
              common stock.  These shares had been  authorized  for issue during
              prior  years.  No  details  were  available  as to whom the shares
              should  be issued  to.  Management  canceled  these  shares  which
              resulted in contributed capital of $8,394.

              On December 31, 1997, the Company  canceled 98,000 shares of Class
              A preferred stock,  272,200 shares of Class B preferred stock, and
              10,200 shares of Class C preferred  stock.  No record of owners of
              these shares could be determined.  The results of the cancellation
              of these shares was contributed capital of $380,400. All dividends
              associated  with the  canceled  shares  were  also  canceled.  The
              Company  may be liable to the owners of these  shares,  should the
              owners of these shares be identified.

              At December 31, 1998,  a creditor  made a claim for  approximately
              $20,000.  Management  contends  the  amount  is  not  owed  due to
              non-performance  by the  Lessor.  The  amount  has been due  since
              February 1994.

              At December 31, 1998,  a creditor  made a claim for  approximately
              $19,000.  Management  contends  the  amount  is  not  owed  due to
              non-performance  by the  creditor.  The  amount has been due since
              June 1996.

              During the year ended  December 31, 2000,  the Company  received a
              loan  from  an  unrelated  party  for  $75,000.  As  part  of  the
              agreement,  the Company  guaranteed  payment from a third party to
              the same  creditor  for an  additional  $75,000.  Should the third
              party default on the loan,  the Company may be held liable for the
              $75,000 plus accrued interest.

NOTE 4 -      NOTES PAYABLE
<TABLE>
<CAPTION>
              Notes payable of the Company are as follows:

                                                                                                    December 31,
                                                                                                        2000
                                                                                                ------------------
              <S>                                                                               <C>
              Unsecured notes payable to a related party, past due, bearing
               12% interest.                                                                    $          165,500

              Unsecured  promissory  notes  bearing  interest  at 10%.  Interest
               payable  annually in either stock or cash,  or both.  The lenders
               may earn bonus distributions based on the productivity of mining
               operations.  Due on demand.                                                                   6,000

              Non-interest bearing notes payable to various parties, secured by
               guarantees of common stock. Due on demand.                                                  116,900

              Unsecured notes payable to various related parties.
                Due on demand.                                                                             151,200
                                                                                                ------------------
              Balance forward                                                                   $          439,600
                                                                                                ------------------

                                      F-16
<PAGE>

              EQUITY TECHNOLOGIES & RESOURCES, INC. AND SUBSIDIARY
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                           December 31, 2000 and 1999


NOTE 4 -      NOTES PAYABLE (Continued)
<CAPTION>
                                                                                                    December 31,
                                                                                                       2000
                                                                                                ------------------
              <S>                                                                               <C>
              Balance forward                                                                   $          439,600

              Less related party notes                                                                    (316,700)
                                                                                                ------------------
              Total notes payable                                                                          122,900

              Less current portion                                                                        (122,900)
                                                                                                ------------------
              Total Long-Term Debt                                                              $           -
                                                                                                ==================
              Scheduled maturities of notes payable are as follows:
                    2001                                                                        $          439,600
                                                                                                ==================
</TABLE>

NOTE 5 -      CAPITAL STOCK

              a.  Preferred Stock - Series A

              The Company is authorized to issue 2,000,000  shares of non-voting
              preferred shares, at a par value of $1.00 per share.  These shares
              accrue a 10% dividend annually.  The cumulative amount of dividend
              was  $30,000   and   $25,000  at  December   31,  2000  and  1999,
              respectively.  These preferred shares are convertible into Class A
              common  stock at a conversion  rate of 5.5 common  shares for each
              preferred  share.  There were 50,000 shares issued and outstanding
              at December 31, 2000.

              Dividends  paid  during  1995  amounted  to  $17,717  for 1993 and
              $14,800 for 1994. No dividends have been paid since 1995.

              b.  Preferred Stock - Class B

              The  Company  is  authorized  to issue  300,000  shares  of voting
              preferred shares, at a par value of $1.00 per share.  These shares
              accrue a 10%  dividend  payable  annually on June 30 of each year.
              The  cumulative  amount of dividend was $-0- at December 31, 2000.
              These preferred  shares are convertible  into Class A common stock
              at a conversion rate of 16 common shares for each preferred share.
              In December  2000,  the Company  issued  40,000  shares of voting,
              Class B preferred stock in exchange for all the outstanding shares
              of Verified Prescription Safeguards, Inc. (Note 1).

                                      F-17
<PAGE>

              EQUITY TECHNOLOGIES & RESOURCES, INC. AND SUBSIDIARY
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                           December 31, 2000 and 1999

NOTE 5 -      CAPITAL STOCK (Continued)

              c.  Preferred Stock - Class C

              The Company is authorized  to issue  100,000  shares of non-voting
              preferred  shares at a par value of $1.00 per share.  These shares
              accrue a 10% dividend annually.  The cumulative amount of dividend
              was  $-0-  at  December  31,  2000.  These  preferred  shares  are
              convertible  into Class A common stock at a conversion  rate of 12
              common  shares for each  preferred  share.  There were $-0- shares
              issued and outstanding at December 31, 2000.  Management  canceled
              all outstanding shares and related dividends payable in 1997.

              d.  Common Stock - Class A

              The  Company  is  authorized  to issue  99,900,000  Class A common
              shares, at a par value of $0.001 per share. These shares have full
              voting  rights.  There were  2,121,907  shares  outstanding  as of
              December 31, 2000.

              In October 1997, the Company issued 9,150,000 post-split shares of
              Class A common stock for cash and mining rights. These shares were
              canceled due to  non-performance  of the terms of the  agreements.
              25,000 shares were  returned in October  1997.  1,487,000 of these
              shares were used to settle debt of the  Company.  At December  31,
              1999, 145,000 remained outstanding.

              In September 1997, the Company authorized a reverse stock split of
              100-for-1. Shares outstanding have retroactively been restated.

              The Company issued 161,944 and 135,284 shares as dividends in 1995
              for 1993 and 1994 dividends accrued.

              In May 1995,  the Company  issued in error  9,617,000  shares to a
              related  party that were  returned  to the  Company  and  canceled
              during 1996. There was no consideration  exchanged in the issuance
              or cancellation of these shares.

              In June 2000, the Company issued  8,331,408 shares of its series A
              common   stock  to   related   parties   at  $0.14  per  share  as
              consideration  for  services  rendered.  The shares were valued at
              fair market value at the time of the issuance.

              In July 2000, the Company  elected to  reverse-split  its series A
              common shares on a 1:50 basis,  leaving  306,700 shares issued and
              outstanding  after the split.  All  previously  issued shares have
              been  retroactively  restated  in the  accompanying  statement  of
              stockholders' equity to reflect this stock split.

              In August 2000, the Company reacquired  6,000,000 shares of common
              stock  from a  director  in  exchange  for a  promissory  note for
              $120,000  payable  to the  director.  The  6,000,000  shares  were
              subsequently canceled.

              In August 2000, the Company issued 7,350,000  post-split shares of
              Series A common  stock for  services  rendered.  The  shares  were
              valued at $0.14 per share,  which was the fair market value of the
              shares at the date of the issuance.

              In October 2000,  the Company  elected to cancel 220,000 shares of
              its Series A common stock.

                                      F-18
<PAGE>

              EQUITY TECHNOLOGIES & RESOURCES, INC. AND SUBSIDIARY
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                           December 31, 2000 and 1999

NOTE 5 -      CAPITAL STOCK (Continued)

              d.  Common Stock - Class A (Continued)

                    In November and December of 2000, the Company issued 535,000
              shares in exchange for services  rendered.  The shares were valued
              at $0.25 - $0.38  per share  based  upon the  market  value of the
              stock at the issuance dates.

              In November 2000, the Company issued 90,000 shares of its Series A
              common stock for $22,500 in cash.

              e.  Common Stock - Class B

              The Company is authorized  to issue 100,000  shares of its Class B
              common  shares  at a par  value of $0.01  per  share.  The Class B
              shares  have  the  right  to  elect a  majority  of the  Board  of
              Directors of the Company.  There were  100,000  shares  issued and
              outstanding  as of December 31, 2000. All Class B shares of common
              stock are held by a director at December 31, 2000.

NOTE 6 -      RELATED PARTY TRANSACTIONS

              Arkansas  American Mining and  Exploration,  Inc. (AAME) was owned
              and  controlled  by the  founders of the  Company.  In 1988,  AAME
              exchanged mining claims, milling facility and a core drilling rig,
              for the Company's common stock.

              In 1994, a related  party loaned the Company  $152,000  secured by
              the Company's  land,  buildings,  and equipment.  This note,  plus
              interest,  was due in the  fourth  quarter  of 1996.  The  Company
              defaulted on the note.  The property and equipment were claimed by
              the note holder and written off by the Company.

              During 1995,  the Company  paid  $25,000 for services  rendered by
              related  parties  and  issued  2,500,000  shares of Class A common
              stock for additional services valued at $26,225.

              During 1997, the Company issued 1,029,500 shares of common A stock
              to a former  President  of the  Company  for  services  valued  at
              $102,000.  An agreement has been made with this former officer for
              continued consulting services.

              On December 23, 1998, the Company  borrowed $61,000 from Kentrust,
              Inc.,  an entity whose CEO is a director of the Company.  The note
              carried a 10% interest  rate, and was due on December 23, 1999. In
              1999, the Company borrowed an additional $104,500 from Kentrust at
              10%. During the year, the entire $165,500 became overdue and began
              accruing  interest at a rate of 12% per annum.  A $16,550  penalty
              for late payment was also levied against the Company.  At December
              31, 2000, the principal balance on this note remained at $165,000.

                                      F-19
<PAGE>

              EQUITY TECHNOLOGIES & RESOURCES, INC. AND SUBSIDIARY
                          (A Development Stage Company)
                 Notes to the Consolidated Financial Statements
                           December 31, 2000 and 1999


NOTE 7 -      GOING CONCERN

              The  Company  has  limited  operations  and has not  been  able to
              develop  an  ongoing,  reliable  source  of  revenues  to fund its
              existence.  The Company's day-to-day expenses have been covered by
              cash  obtained  from the issuance of stock,  and by proceeds  from
              notes  payable.  The adverse  effect on the  Company's  results of
              operation due to its lack of capital  resources can be expected to
              continue  until  such  time as the  Company  is  able to  generate
              additional capital from other sources.

              These  conditions  raise  substantial  doubt  about the  Company's
              ability  to  continue   as  a  going   concern.   Management   has
              implemented,  or developed plans to implement, a number of actions
              to address these conditions  including the acquisition of Verified
              Prescription  Safeguards,  Inc.,  which  management  believes will
              provide  opportunities for growth within the internet prescription
              drug industry.

              Additional funding will be necessary for the Company's development
              plans.  There can be no assurance that additional  funding will be
              available  when  needed or, if  available,  that the terms of such
              financing  will not adversely  affect the  Company's  results from
              operations.

              The   consolidated   financial   statements  do  not  include  any
              adjustment  to  reflect  the  possible   future   effects  on  the
              recoverability  and  classification  of assets or the  amounts and
              classification  of liabilities that may result from the outcome of
              this uncertainty.

                                      F-20
<PAGE>

                                   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.

                                          EQUITY TECHNOLOGIES & RESOURCES, INC.
                                                       (Registrant)

                                          BY:  /s/  Frank G. Dickey, Jr.
                                              ------------------------------
                                              Frank G. Dickey, Jr., President

Dated: May 4, 2001


                                       5