---

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UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

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FORM 10-QSB

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(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTER ENDED MARCH 31, 2002

OR

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

FOR THE TRANSITION PERIOD FROM ___________ TO _____________

Commission file number 000-22833

PACIFIC SYSTEMS CONTROL TECHNOLOGY, INC.



|**Delaware**                                                   | **90-0013185**                         
|-------------------------------------------------------------- | ---------------------------------------
|(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification Number)

100 Marine Parkway, Suite 325Redwood Shores, California 94065(Address of Principal Executive Offices including Zip Code)

(650) 802-8299(Registrant's Telephone Number, Including Area Code)

(Former Name, Former Address and Former Fiscal Year, if changed since last report)

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



Applicable only to issuers involved in bankruptcy proceedings during the past five years:

Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 12, 13, or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes [  ] No [  ]



Applicable only to corporate issuers:

Indicate the number of shares outstanding of each of the registrant's classes
of common stock, as of the latest practicable date.

Number of shares of common stock, par value $0.0001, outstanding as of
May 15, 2002 is 27,574,371.



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

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PACIFIC SYSTEMS CONTROL TECHNOLOGY, INC.FORM 10-QSB

For March 31, 2002

TABLE OF CONTENTS

|           |                                                                                             |   
|---------- | ------------------------------------------------------------------------------------------- | --
|Item 1.    | Financial Statements                                                                        |   
|           | Balance Sheets as of March 31, 2002 and December 31, 2001                                   | 3 
|           | Statements of Operations for the three periods ended
      March 31, 2002 and 2001          | 4 
|           | Statements of Cash Flows for the three month periods ended
      March 31, 2002 and 2001    | 5 
|           | Notes to Financial Statements                                                               | 6 
|Item 2.    | Management's Discussion and Analysis of Financial Condition and Results
      of Operations | 12
|           |                                                                                             |   
|Part II.   | Other Information                                                                           |   
|Item 1.    | Legal Proceedings                                                                           | 14
|Item 2.    | Changes in Securities and Use of Proceeds                                                   | 14
|Item 3.    | Defaults Under Senior Securities                                                            | 14
|Item 4.    | Submission of Matters to a Vote of Security Holders                                         | 14
|Item 5.    | Other Information                                                                           | 14
|Item 6.    | Reports on Form 8-K                                                                         | 14
|           |                                                                                             |   
|Signatures |                                                                                             |   

---

PART I



Item 1. Financial Information - (unaudited)



PACIFIC SYSTEMS CONTROL TECHNOLOGY, INC.
CONSOLIDATED BALANCE SHEET

`March 31      December 31
                                             2002           2001
                                         ------------   ------------
                                          (unaudited)      (audited)
ASSETS
  Current Assets
    Cash                                 $    13,298    $   504,554
    Accounts receivable                       54,722        172,736
    Prepaid expenses                           2,448          2,448
    Other assets                             300,000        300,000
    Note receivable                          393,000            -
                                         ------------   ------------
    Total current assets                     763,468        979,738

  Property and equipment, net                 36,559        121,796
  Investments                                471,082        471,082
                                         ------------   ------------
    Total Assets                         $ 1,271,109    $ 1,572,616
                                         ============   ============

LIABILITIES
  Current liabilities
    Accounts payable and
      accrued expenses                   $   303,003    $   634,783
    Advances from related parties            821,745        810,745
    Other                                        -           74,168
    Related party payable                    332,954            -
    Notes payable                            117,185        185,852
                                         ------------   ------------
    Total current liabilities              1,574,887      1,705,548
                                         ------------   ------------
STOCKHOLDERS' EQUITY
  Preferred stock, $0.0001 par value;
    10,000,000 shares authorized         $       -      $       -
  Common stock, $0.0001 par value;
    100,000,000 shares authorized              2,758          2,758
  Additional paid-in capital              28,281,222     28,960,103
  Accumulated deficit                    (28,587,758)   (29,095,793)
                                         ------------   ------------
    Total Stockholders' Equity              (303,778)      (132,932)
                                         ------------   ------------
                                         $ 1,271,109    $ 1,572,616
                                         ============   ============`

---

**PACIFIC SYSTEMS CONTROL TECHNOLOGY, INC.
CONSOLIDATED STATEMENT OF OPERATIONS**

`Three-month Periods Ended
                                       -----------------------------
                                          March 31        March 31
                                            2002            2001
                                       -------------   -------------
                                         (unaudited)     (unaudited)
REVENUE
  Licensing fee                                 -               -
  Other                                         -               132
                                       -------------   -------------
    Total revenue                               -               132
                                       -------------   -------------

COSTS AND EXPENSES
  Cost of sales - Film income                   -               -
  Film cost amortization and reserve            -               -
  Selling                                       -               -
  Salaries and payroll taxes                 24,599             -
  Rent                                       14,407          29,105
  General and administrative                 59,839          65,301
                                       -------------   -------------
    Total costs and expenses                (98,845)        (94,406)
                                       -------------   -------------

OTHER INCOME (EXPENSES)
  Inter-company interest expense, net           -            30,000
  Interest expense                           (1,000)         (1,211)
  Other income                                7,670             -
                                       -------------   -------------
    Total other income (expenses)             6,670          28,789
                                       -------------   -------------

LOSS FROM OPERATIONS BEFORE
  PROVISION FOR INCOME TAXES                (92,175)        (65,485)

PROVISION FOR INCOME TAXES                      -               -
                                       -------------   -------------
NET LOSS                                    (92,175)        (65,485)
                                       =============   =============

Weighted average number of
  shares outstanding                     27,574,371      25,578,706
                                       =============   =============

Basic and diluted loss per share            $(0.003)        $(0.003)
                                       =============   =============`

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

---

**PACIFIC SYSTEMS CONTROL TECHNOLOGY, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS**

`Three Months     Three Month
                                                           Ended            Ended
                                                       --------------    --------------
                                                       March 31, 2002    March 31, 2001
                                                       --------------    --------------
                                                         (unaudited)       (unaudited)

CASH FLOWS FROM OPERATING ACTIVITIES
  Net loss                                             $     (92,175)    $     (65,485)
  Adjustments to reconcile net loss
    to net cash used for operating activities
      Depreciation and amortization                           1,676             1,112

  (Increase) decrease in
    Accounts receivable                                      (14,986)              -
    Prepaid expenses and other                                   -              (5,205)
    Due from subsidiary                                          -            (141,923)

  Increase (decrease) in
    Accounts payable and accrued expenses                    (22,564)          (76,566)
    Other                                                     (1,540)           (3,746)
                                                       --------------    --------------
      Net cash used for operating activities                (129,589)         (291,813)
                                                       --------------    --------------

CASH FLOWS FROM INVESTING ACTIVITIES
  Purchase of property and equipment                             -              (3,125)
  Increase in note receivable                                (393,000)             -
  Increase in other investments                                  -             (30,000)
                                                       --------------    --------------
    Net cash used for investing activities                   (393,000)         (33,125)
                                                       --------------    --------------

CASH FLOWS FROM FINANCING ACTIVITIES
  Proceeds from exercise of common stock options                 -             300,000
  Proceeds on loans from related parties                       50,000           18,000
  Payments on notes payable                                   (18,667)          (2,501)
                                                       --------------    --------------
    Net cash provided by financing activities                  31,333          315,499
                                                       --------------    --------------

NET DECREASE IN CASH                                         (491,256)          (9,439)

CASH, beginning of period                                     504,554           20,510
                                                       --------------    --------------
CASH, end of period                                    $       13,298           11,071
                                                       ==============    ==============


SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
  Cash paid during the period for
    Interest                                           $       1,000     $       1,211
                                                       ==============    ==============
    Foreign and state income taxes                     $         -       $         -
                                                       ==============    ==============

SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING
AND FINANCING ACTIVITIES
  Long-term debt converted to equity                   $         -       $   2,000,000
                                                       ==============    ==============
  Common stock and warrants issued related
    to redemption of debentures                        $         -       $   2,078,391
                                                       ==============    ==============
  Distribution of investment in subsidiary to
    shareholders                                       $  12,199,785     $         -
                                                       ==============    ==============`

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

---

NOTES TO FINANCIAL STATEMENTS
For the three-month period ended March 31, 2002

Note 1 - Nature of Operations and Spin-off of Subsidiary

Basis of Presentation and Consolidation - The consolidated financial statements include the accounts of Pacific Systems Control Technology, Inc. (the "Company") and its wholly owned subsidiary, America's Best Karate ("ABK"), which owns 100% of PeopleNet International Corporation (formerly known as American Champion Media, Inc. or "AC Media")
until February 8, 2002 when AC Media was effectively spun-off from the Company
and became an independent entity, and American Champion Marketing ("AC Marketing"), which is a wholly owned subsidiary of AC Media. There was no activity in AC Marketing during 2001
and the three-month period ended March 31, 2002. All significant intercompany accounts and transactions have been eliminated in consolidation.

In August 2001, the Company changed its name from American Champion Entertainment, Inc. to Pacific Systems Control Technology, Inc.  AC Media also changed its name to PeopleNet International Corporation ("PeopleNet").

Spin-off - On June 22, 2001, the Company approved a plan to spin-off PeopleNet to the shareholders as a tax-free distribution.  Under the plan, each stockholder of the Company receives one share of PeopleNet stock for every 17 shares of common stock held as of the
record date of January 16, 2002.  Subsequent to and as part of the spin-off, PeopleNet issues 374,587 shares of common stock, with registration rights, to ECapital, an unrelated party, in exchange for the worldwide exclusive rights to market and distribute ChiBrow, a safe web browser software for children for three years.    The related party note payable to PeopleNet is also converted to common stock.    The spin-off became effective in January 2002 and all shares were distributed to the above parties on February 8, 2002.  As part of this plan, the advances PeopleNet made to ABK were offset against the amounts due to the Company and the net amount were converted to additional paid-in-capital of PeopleNet.

Nature of Operations - The Company is engaged in the development and sales of utilities meter products and technology. This is a new line of business for the Company.  The Company expects to generate revenues from these operations beginning in 2002.

Going Concern  - Management's plans and the ongoing operations of the Company
are expected to require working capital during 2002. The Company has experienced
continuing losses from operations. The Company is also changing its principle
lines of business with respect to the manufacture and distribution of utility
metering devices. In addition,  PeopleNet was spun-off in
February 2002. These factors cause substantial doubt about the ability of the
Company to continue as a going concern. Management will be required to obtain
additional capital to fund the ongoing operations during the remainder of 2002.
In December 2000, Holley has signed stock purchase agreements with the Company
to purchase additional shares from the Company. In 2001, 135,000 shares were
purchased under these agreements. Although Holley has not purchased substantial
shares from the Company during 2001, it has advanced approximately $800,000 as
well as additional capital contributions of $300,000 to the Company for its
daily operations.

The accompanying financial statements have been prepared on a
going concern basis, which contemplates the realization of assets and
satisfaction of liabilities and commitments in the normal course of operations.
The continuation of the Company as a going concern is dependent upon the success
of obtaining additional capital and, thereafter, on attaining profitability.
There can be no assurance that management will be successful in the
implementation of its plan. The financial statements do not include any
adjustments in the event the Company is unable to continue as a going concern.



Note 2 - Summary of Significant Accounting Policies

Revenue Recognition -  There was no revenue generated from the
development and sales of utilities meter products and technology for the year
ended December 31, 2001 and for the three-month period ended March 31, 2002.

Concentrations of Risk - Financial instruments which potentially subject the Company to concentrations of credit risk are cash and accounts receivable. The Company places its cash with financial institutions deemed by management to be of high credit quality. The amount on deposit in any one institution that exceeds federally insured limits is subject to credit risk.

Cash and Cash Equivalents - The Company considers certain highly liquid instruments purchased with original maturities of three months or less to be cash equivalents.

Property and Equipment - Property and equipment is stated at cost. Depreciation for furniture and fixtures and certain equipment is computed using the straight-line method over an estimated useful life of five years. Leasehold improvements are amortized using the straight-line method over the term of the respective leases.

Fair Values of Financial Instruments - The carrying values of cash, receivables, accounts payable and short-term borrowings approximate fair value due to the short maturity of these instruments. The carrying values of long-term obligations approximate fair value since the interest rates either fluctuate with the lending banks' prime rates or approximate market rate. None of the financial instruments are held for trading purposes.

Basic Loss Per Share - Basic loss per share is based on the weighted average outstanding shares issued. Because the Company has a net loss, the common stock equivalents would have an anti-dilutive effect on earnings per share. Accordingly, basic earnings per share and diluted earnings per share are the same.

Income Taxes - Income taxes are accounted for using an asset and liability approach, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between financial statement and tax basis of assets and liabilities at the applicable enacted tax rates.  Generally accepted accounting principles require a valuation allowance against deferred tax assets if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.  The Company and its Subsidiaries file a consolidated tax return.

Reclassifications - Certain reclassifications have been made to the 2001 amounts to conform to the current presentation.

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

Note 3 - Basis of Reporting

The accompanying unaudited financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-QSB. 
Accordingly, they do not include all of the information and disclosures required
by generally accepted accounting principles for completed financial statements. 
In the opinion of management, such statements include all adjustments
(consisting only of normal recurring items) which are considered necessary for a
fair presentation of the financial position of the Company on March 31, 2002 and
the results of its operations and its cash flows for the three months periods
ended March 31, 2002 and 2001.  The accompanying unaudited financial
statements should be read in conjunction with the financial statements and notes
for the year ended December 31, 2001 included in the Company's Form 10-KSB as
filed with the SEC on April 15, 2002.

Note 4 - Other Assets

Other assets consist of a deposit paid to an outside vendor
as part of the commitment for the purchase of metering devices as disclosed in
Note 8.  The deposit will be refunded to the Company if the vendor fails to comply with the specified parameters established by the Company.
The deposit will be accounted for as part of the cost of the completed meters.

Note 5 - Note Receivable

The Company loaned $393,000 to a company owned by the
Company's largest shareholder.  The loan is unsecured, non-interest
bearing and expected to be re-paid in 2002.



Note 6 - Advances from Related Parties

The advances from related parties are non-interest bearing
and are unsecured.



Note 7 - Lease Commitments

In October 2001, the Company relocated its headquarters and entered into a 40-month non-cancelable lease with monthly rent of approximately $4,000, subject to increases at each anniversary.  The Company's old office is still under the 4-year non-cancelable lease,
with monthly rent of approximately $6,000, which the Company signed in July 2000.  The old office lease expires in August 2004.   The amounts paid under these leases during the year ended December 31, 2001 was $72,000.

The future minimum lease payments under these operating leases are as follows.

`2002          $ 120,000
     2003            126,000
     2004            106,000
     2005             21,000
                   ---------
                   $ 373,000
                   =========`

The Company subleases the old office under a non-cancelable operating lease, expiring in August 4, 2004.  Rental income earned under this lease totaled to $5,000 for the year ended December 31, 2001.

The future minimum rental income under this operating lease is as follows:

`2002          $  38,000
     2003             76,000
     2004             52,000
                   ---------
                   $ 166,000
                   =========`

Note 8 - Commitments and Contingencies

In February 2001, the Company signed a 5-year contract with a company in China to deliver up to 1,000,000 units of electronic, multi function meters over a 5-year period.  The Company will purchase the meters in U.S. and resells to the purchaser.  The contract is expected to generate a total of approximately $200,000,000 for the Company over the next five years.

In August 2001, the Company signed an agreement with a product development and manufacturing company to develop meters based on agreed specifications.  The Company agreed to purchase a minimum of 50,000 units of such developed products in 2002 upon successful compliance with the specifications.  The entire project will cost $2 million.  $300,000 was paid when the agreement was signed.  The remaining will be paid in $700,000 and $1,000,000 installments upon the completion of two milestones agreed by both parties.  Upon completion of the product, the Company shall have the exclusive rights at no cost to sell the product in China and non-exclusive right at no cost to sell the product worldwide.

In February 2001, a complaint was filed by Chuck Nelson in
Court of Common Pleas, Mahoning County in Youngstown, Ohio against the Company
for a percentage of the total purse amounts paid to boxers in the Company
produced boxing event in China in April 2000, and for a percentage of the
television revenue generated thereof. The Company denies all of the rights
claimed by Chuck Nelson and will vigorously defend against all of Mr. Nelson's
claims.

In October 2001, the Company filed a complaint against a former employee in licensing
and marketing activities for breach of contract, breach of fiduciary duty and unjust
enrichment, among other causes of action, seeking declaratory relief from the court. 
A counter claim from the employee was filed in April 2002 naming the Company
including all of its subsidiaries as the defendants in the cross-complaint. The Labor Commission
of California in December 2001 issued a judgment against the Company including
all of its subsidiaries in the amount of $69,170.58
in favor of the employee. This amount has been accrued as of December 31, 2001.

As the parent company, Pacific Systems has agreed to indemnify all of its
subsidiaries including PeopleNet from the liabilities of these two cases including expenses, fees or judgment.

The Company may be contingently obligated under the following commitments
through PeopleNet, which was spun-off as disclosed in Note 1.

On December 27, 2000, PeopleNet entered into a worldwide distribution agreement with respect to The Adventures with Kanga Roddytelevision program with World Channel, Inc.  Under the agreement, World Channel will have the exclusive rights for exhibition, distribution, process and reproduction and all commercial exploitation of the program for a period of five years.  The agreement requires World Channel to make five annual installments of $600,000 on or before the end of each of the years 2001 through 2005.  For the year ended December 31, 2001, the Company recognized $450,000 film income in relation to this distribution agreement, $193,000 of which was collected before year-end.  Management did not recognize film income for the fourth quarter of 2001 based on management's evaluation of collectibility of the amounts due under the agreement.  A 50% reserve on the remaining receivable was also established as of December 31, 2001.   Because current year collection activity raises substantial doubt with respect to amounts due in future years under this agreement and because there are currently no other agreements in place, the Company has reserved the remaining unamortized film costs for "The Adventures With Kanga Roddy" television program.

In June 2001 the Company signed an agreement with ECapital Group, Inc. ("ECapital") to purchase the exclusive licensing and marketing rights to ChiBrow, a safe web browser software for children.  Under the terms of the agreement, upon the effectiveness of the spin-off of the Company from PSCT, the Company will issue 375,000 shares of common stock, with registration rights, to ECapital in exchange for the worldwide exclusive rights to market and distribute ChiBrow for three years (see Note 1).  The Company intends to file a registration statement for such shares immediately after the effectiveness of the spin-off transaction.  Pursuant to the terms of the agreement, the Company shall retain 35% of all revenues generated from such marketing efforts and the balance shall be paid to ECapital.
(See Note 19)



Note 9 - Industry Segments

The Company operates in one segment, utilities metering
devices.  All assets are located in the United States of America.

---

Item 2. Management's Discussion And Analysis Of Financial Condition And Results Of Operations

Forward Looking Information

The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" from liability for forward-looking statements.
Certain information included in this Form 10-QSB and other materials filed or to be filed by the Company with the Securities and
Exchange Commission (as well as information included in oral statements or other written statements made or to be made by or on
behalf of the Company) are forward-looking, such as statements relating to operational and financing plans, capital uses and
resources, competition, and demands for the Company's products and services. Such forward-looking statements involve important
risks and uncertainties, many of which will be beyond the control of the Company. These risks and uncertainties could significantly
affect anticipated results in the future, both short-term and long-term, and accordingly, such results may differ from those
expressed in forward-looking statements made by or on behalf of the Company. These risks and uncertainties include, but are not
limited to, changes in external competitive market factors or in the Company's internal budgeting process which might impact trends
in the Company's results of operations, unanticipated working capital or other cash requirements, changes in the Company's business
strategy or an inability to execute its strategy due to unanticipated change in the industries in which it operates, and various
competitive factors that may prevent the Company from competing successfully in the marketplace. The following discussion may
contain forward-looking statements that are subject to risks and uncertainties. For a discussion of factors that could cause actual
results to differ, please see the discussion contained herein. Readers should not place undue reliance on the forward-looking
statements, which reflect management's view only as of the date hereof. The Company undertakes no obligation to publicly revise
these forward-looking statements to reflect subsequence events or circumstances. Readers are also encouraged to review the
Company's publicly available filings with the Securities and Exchange Commission.

The following section discusses the significant operating changes, business trends, financial condition, earnings and liquidity
that have occurred in the three-month period ended March 31, 2002. This discussion should be read in conjunction with the Company's
financial statements and notes appearing elsewhere in this report.

Critical Accounting Policies

In the ordinary course of business, the company has made a number of estimates and assumptions relating to the reporting of results of operations and financial condition in the preparation of its financial statements in conformity with accounting principles generally accepted in the United States of America. Actual results could differ significantly from those estimates under different assumptions and conditions. The Company believes that the following discussion addresses the Company's most critical accounting policies, which are those that are most important to the portrayal of the Company's financial condition and results. The Company constantly re-evaluates these significant factors and makes adjustments where facts and circumstances dictate. Although historically, actual results have not significantly deviated from those determined using the necessary estimates inherent in the preparation of financial statements, future actual results may vary significantly. Estimates and assumptions include, but are not limited to, customer receivables, long-term asset lives, contingencies and litigation. The Company has also chosen certain accounting policies when options were available, including:

- The intrinsic value method, or APB Opinion No. 25, to account for our common stock incentive awards; and
- We record an allowance for credit losses based on estimates of customers' ability to pay. If the financial condition of our customers were to deteriorate, additional allowances may be required.
- We will adopt SFAS 142, Goodwill and Other Intangible Assets, in fiscal year 2002. We have not yet evaluated the effects of these changes.

These accounting policies are applied consistently for all years presented. Our operating results would be affected if other alternatives were used. Information about the impact on our operating results is included in the footnotes to our consolidated financial statements.



Results of Operation

The Company was formed in February 1997 and has a wholly owned
subsidiary, ABK, which had no activities in the year 2001 nor the three-month
period ended March 31, 2002. ABK wholly owned AC Media until February 8, 2002
when AC Media was effectively spun-off and became an independent entity with its
name changed to PeopleNet International Corporation. In March 2000, the Company
signed a Stock Exchange Agreement with BA Networks for the acquisition of 80% of
the common stock of BA Networks. The Company's shareholders approved of the
acquisition at the Company's Annual Meeting of Shareholders held on September
27, 2000. The owners of BA Networks have agreed to sell an 80% interest in BA
Networks to the Company. According to commerce regulation of China, such exchange of
ownership needs to be incorporated into a co-operative joint venture ("CJV"). On
October 28, 2000 BA Network signed a letter of intent with the Company to set up a
"CJV" in China into which all of BA Networks' assets will be transferred. The
CJV will be owned 80% by the Company and 20% by BA Networks. The establishment of CJV
was approved by the Beijing Municipal Government on December 1, 2000 and the
business license was granted on December 20, 2000. As of March 31, 2002, the
transfer of assets from BA Networks has not yet been made. Since the Company does not have control of BA
Networks until the transfer of assets occurs, the investment in BA Networks is
being accounted for as a deposit under the cost method of accounting as of
December 31, 2001 at the original purchase price of $450,000. Upon completion of
the transfer of assets the acquisition will be accounted for under the purchase
method of accounting. The operations of BA Networks are conducted exclusively in
the People's Republic of China ("PRC"). It is at least reasonably possible that
the activities of BA Networks, which are conducted in the People's Republic of
China, may be disrupted in the near term from factors outside the control of the
Company such as from negative effects of economic and political forces.

Revenues

During the three-month period ended March 31, 2002, our main focus was on the
spin-off of our subsidiary, PeopleNet International Corporation, which was
effectively completed as of February 8, 2002.  Upon the spin-off, our shareholders
received one share of PeopleNet International Corporation common stock for every
seventeen shares of our common stock held as of the record date of January 16,
2002.  We had insignificant amount of revenues for this three-month period.

Costs and Expenses

During the three-month period ended March 31, 2002, we incurred $24,599 in
salaries and payroll expenses, $14,407 for rent, and $59,839 in general and
administrative expenses which included legal and accounting expenses. 
Interest expense for the period was $1,000.

As a result of foregoing factors, our net loss was ($92,175) for the
three-month period ended March 31, 2002
as compared to ($65,485) for the same period in 2001. Net loss per share was
unchanged at ($0.003) for this period as compared to the same period in 2001,
while weighted average number of shares increased to 27,574,371 from 25,578,706
of the same period last year.

Liquidity and Capital Resources

Stockholders' equity decreased to a negative ($303,778) at
March 31, 2002 due to the spin-off distribution of PeopleNet from the Company
as of February 8, 2002.

Cash decreased for the three months ended March 31, 2002 by
($491,256) primarily due to a loan to another company that is owned by our
largest shareholder Holley Holdings USA. Cash utilized for operations for the three months ended
March 31,
2002 was ($129,589). Cash  from financing activities  was an increase of $31,333.

The Company has historically financed its operating and capital
outlays primarily through sales of common stock, loans from stockholders and
other third parties and bank financing.   The Company's
largest shareholder, Holley Holding USA, has provided the funds to the Company
in terms of an unsecured loan with no interests, for the Company operational
needs.  However, there is no assurance that Holley Holding USA will
continue to assist the Company in the future.

A payable in the amount of $332,954 was set up to
account for payables that were included in the financial statements of PeopleNet
International Corporation as a result of the spin-off transaction.  As part
of the spin-off the Company agreed to reimburse PeopleNet for these liabilities.

---

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

In February 2001, a complaint was filed by Chuck Nelson in
Court of Common Pleas, Mahoning County in Youngstown, Ohio against the Company
for a percentage of the total purse amounts paid to boxers in the Company
produced boxing event in China in April 2000, and for a percentage of the
television revenue generated thereof. The Company denies all of the rights
claimed by Chuck Nelson and will vigorously defend against all of Mr. Nelson's
claims.

In October 2001, the Company filed a complaint against a former employee in licensing
and marketing activities for breach of contract, breach of fiduciary duty and unjust
enrichment, among other causes of action, seeking declaratory relief from the court. 
A counter claim from the employee was filed in April 2002 naming the Company
including all of its subsidiaries as the defendants in the cross-complaint. The Labor Commission
of California in December 2001 issued a judgment against the Company including
all of its subsidiaries in the amount of $69,170.58
in favor of the employee. This amount has been accrued as of December 31, 2001.  Pacific Systems
Control Technology has agreed to indemnify all of its
subsidiaries including PeopleNet from the liabilities of these two cases including expenses, fees or judgment.

With the exception of the foregoing, no lawsuits or proceedings
are currently pending against the Company.



Item 2. Changes in Securities and Use of Proceeds.  None



Item 3. Defaults Under Senior Securities.  None



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

In January 2002, the Company's majority shareholders approved the spin-off distribution of a subsidiary,
an increase in the authorized number of shares of our common stock to 100,000,000, an increase
in the authorized number of shares of our preferred stock to 10,000,000 and increase
number of shares available for grant pursuant to the Company's 1997 Employee Stock
Option Plan from 1,750,000 to 10,000,000 and the Company's 1997 Non-Employee
Directors Stock Option Plan from 200,000 to 500,000.



Item 5. Other Information.  None



Item 6. Reports on Form 8-K.

There were no reports on Form 8-K filed during the three-month period ended
March 31, 2002.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Company has duly caused this report to be signed on its behalf on May 20, 2002 by the
undersigned, thereunto duly authorized.



PACIFIC SYSTEMS CONTROL TECHNOLOGY, INC.

(Registrant)

By: /s/ Anthony K. Chan
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Anthony K. Chan
Chief Executive Officer

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