U.S. SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                 FORM 10-QSB

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

          For the quarterly period ended September 30, 1999

[   ]     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 0-26705

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

           NEVADA                                                88-0354425
           ------                                                ----------
(State or other jurisdiction of                               (I.R.S. Employer
incorporation of organization)                               Identification No.)

                    3305 Spring Mountain Road, Suite 60
                         Las Vegas, Nevada 89102
                         -------------------------------
                    (Address of Principal Executive Offices)

                                 (888) 228-5526
                                 --------------
                           (Issuer's telephone number)

                                       N/A
                                       ---
              (Former name, former address and former fiscal year,
                          if changed since last report)

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

State the number of shares  outstanding of each of the issuers classes of common
equity, as of the latest practicable date:

Class                                       Outstanding as of November 12, 1999
-----                                       ----------------------------------

Common Stock, $.0003 par value              14,131,300

Transitional Small Business Disclosure Format (check one)

         Yes              No      X

<PAGE>


Part I. FINANCIAL INFORMATION

Item 1. Financial Statements
----------------------------

The unaudited  financial  statements of Goldstate Corporation  (the  "Company")
reflect all  adjustments  which are, in the opinion of management,  necessary to
present  a fair  statement  of the  operating  results  for the  interim  period
presented.



                              GOLDSTATE CORPORATION
                         (An Exploration Stage Company)

                              FINANCIAL STATEMENTS
                                   (Unaudited)

                               SEPTEMBER 30, 1999


                                TABLE OF CONTENTS
                                -----------------




                                                                         Page
                                                                         ----

Table of Contents                                                         1

Balance Sheet                                                             2

Statements of Operations                                                  3

Statements of Cash Flows                                                  4

Notes to Financial Statements                                           5 - 12



<PAGE>



                              GOLDSTATE CORPORATION
                         (An Exploration Stage Company)
                                  Balance Sheet

                                                                   September 30,
                                                                        1999
                                                                    ------------
                                     ASSETS
CURRENT ASSETS
  Cash and cash equivalents                                         $       796

OTHER ASSETS
  Interest in unpatented mining claims                                  170,000
                                                                    -----------

      Total Assets                                                  $   170,796
                                                                    ===========


                      LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
CURRENT LIABILITIES
  Accounts payable - trade                                          $    54,008
  Advances payable                                                      181,497
  Accrued interest payable                                               97,666
  Directors fees payable                                                 22,500
  Notes payable                                                         765,255
                                                                    -----------

      Total Liabilities                                               1,120,926
                                                                    -----------

STOCKHOLDERS' EQUITY
  Preferred stock, $.001 par value; authorized 25,000,000 shares;
      issued and outstanding 0 shares at September 30, 1999                --
  Common stock $.0003 par value; authorized 75,000,000 shares;
      issued and outstanding 14,131,300 at September 30, 1999             4,543
  Paid - in capital                                                   1,964,173
  Accumulated deficit through development stage                      (2,965,346)
                                                                    -----------

      Total Stockholders' Equity (Deficit)                             (996,630)
                                                                    -----------

      Total Liabilities and Stockholders' Equity                    $   124,296
                                                                    ===========


                 See accompanying summary of accounting policies
                       and notes to financial statements.

                                        2

<PAGE>
<TABLE>
<CAPTION>

                                                    GOLDSTATE CORPORATION
                                               (An Exploration Stage Company)
                                                  Statements of Operations

                                                                                                                      Inception
                                                                                                                    (February 28,
                                                For the 3 Months Ended Sept. 30,  For the 9 Months Ended Sept. 30,    1996) to
                                                --------------------------------  --------------------------------  September 30,
                                                      1999            1998              1999            1998            1999
                                                  ------------    ------------      ------------    ------------    ------------
                        REVENUES
<S>                                               <C>             <C>               <C>             <C>             <C>
  Other income                                    $       --      $       --        $       --      $       --      $      1,026
                                                  ------------    ------------      ------------    ------------    ------------

      Total Revenues                                      --              --                --              --             1,026
                                                  ------------    ------------      ------------    ------------    ------------

                   OPERATING EXPENSES
  PROPERTY EXPLORATION EXPENSES
   Research and Development
     - Sublicense Agreement                               --              --           666,852              --           666,852
   Claims maintenance fees,
     exploration, and staking costs                     45,870          43,905          45,870            43,905         189,775
                                                  ------------    ------------    ------------      ------------    ------------

      Total Property Exploration Expenses               45,870          43,905         712,722            43,905         856,627
                                                  ------------    ------------    ------------      ------------    ------------


  ADMINISTRATIVE EXPENSES
    Overhead and Administration                        182,470          75,000         782,470           225,000       1,562,470
    Legal and accounting                                    63            --            30,643             5,878         122,534
    Directors fees                                       1,500           1,500           4,500             4,500          22,500
    Internet design and access                            --              --              --               3,461           5,172
    Printing and stationary                               --              --              --               3,741           4,260
    Transfer agent                                          75             115             510             1,413           2,623
    News wire services                                     975             525           1,075             2,330           5,075
    Courier and postage                                    371              99             968               952          10,596
    Reports/information/subscripitions                   2,086            --             2,086               925          35,416
    Bank charges                                            25              24              84               127             451
    Office supplies                                        613            --               613                95           6,623
    Consultants                                           --              --              --                --            88,190
    Office rent                                           --              --              --                --            42,033
    Telephone and fax                                       11            --                11              --            35,567
    Wages and salaries                                    --              --              --                --            22,444
    Travel                                                --              --              --                --            16,731
    Auto                                                  --              --              --                --             7,259
    Promotion                                             --              --              --                --             7,165
    Miscellaneous                                         --              --              --                --             1,410
    Computer supplies                                     --              --              --                --               159
                                                  ------------    ------------    ------------      ------------    ------------

      Total Administrative Expenses                    188,189          77,263         822,960           248,422       1,998,678
                                                  ------------    ------------    ------------      ------------    ------------

        Total Operating Expenses                       234,059         121,168       1,535,682           292,327       2,855,305
                                                  ------------    ------------    ------------      ------------    ------------

Income (Loss) from Operations                         (234,059)       (121,168)     (1,535,682)         (292,327)     (2,854,279)

  OTHER INCOME (EXPENSES)
    Interest Income                                       --              --              --                --                 1
    Interest Expense                                   (18,885)         (6,656)        (43,088)          (20,339)       (111,068)
                                                  ------------    ------------    ------------      ------------    ------------

Net (Loss)                                        $   (252,944)   $   (127,824)   $ (1,578,770)     $   (312,666)   $ (2,965,346)
                                                  ============    ============    ============      ============    ============

Earnings (Loss) Per Share - Basic                 $     (0.018)   $     (0.015)   $     (0.127)       $ (0.039)     $     (0.374)
                                                  ============    ============    ============      ============    ============

Weighted Average Number of
 Common Shares Outstanding                          14,131,300       8,738,800      12,382,536         8,083,489       7,933,044
                                                  ============    ============    ============      ============    ============

                                      See accompanying summary of accounting policies
                                             and notes to financial statements.

                                                             3
</TABLE>
<PAGE>
<TABLE>
<CAPTION>


                                                        GOLDSTATE CORPORATION
                                                   (An Exploration Stage Company)
                                                      Statements of Cash Flows
                                         Increase (Decrease) in Cash and Cash Equivalents


                                                                                                                         Inception
                                                                  For the 3 Months              For the 9 Months       (February 28,
                                                                  Ended Sept. 30,               Ended Sept. 30,          1996) to
                                                            --------------------------    --------------------------   September 30,
                                                                1999           1998          1999            1998           1999
                                                            -----------    -----------    -----------    -----------    -----------
CASH FLOWS FROM OPERATING ACTIVITIES
<S>                                                         <C>            <C>            <C>            <C>            <C>
  Net (loss)                                                $  (252,944)   $  (127,824)   $(1,578,770)   $  (312,666)   $(2,965,346)
  Adjustments to reconcile net (loss) to cash
    used by operating activities
    Amortization and depreciation                                  --             --             --             --               90
    Changes in Assets and Liabilities
        Accounts payable                                           (301)          --           (4,501)          --           54,008
        Director fees payable                                     1,500          1,500          4,500          4,500         22,500
                                                            -----------    -----------    -----------    -----------    -----------

      Net Cash Flows Used for Operating Activities             (251,745)      (126,324)    (1,578,771)      (308,166)    (2,888,748)
                                                            -----------    -----------    -----------    -----------    -----------

CASH FLOWS FROM INVESTING ACTIVITIES
  Equipment (purchases) dispositions                                              --             --             --              (90)
  Organization costs                                               --             --              270           --             --
                                                            -----------    -----------    -----------    -----------    -----------

      Net Cash Flows Provided (Used) for
        Investing Activities                                       --             --              270           --              (90)
                                                            -----------    -----------    -----------    -----------    -----------

CASH FLOWS FROM FINANCING ACTIVITIES
  Sale (redemption) of common stock                                --             --            1,617            989          4,543
  Additional paid-in capital                                          1           --          966,892        459,311      1,801,346
  Offering costs                                                   --             --             --             --           (7,173)
  Advances received                                             233,470        122,681        837,970        417,981      1,774,196
  Advances repaid                                                  --             --         (848,000)      (695,000)    (1,546,200)
  Interest recognized through discount adjustment                  --                          13,403                        13,403
  Notes payable issued for technology                              --                         500,000                       500,000
  Discount on technology notes payable for
    imputed interest                                              6,251                       (23,148)                      (23,148)
  Accrued interest payable                                       12,638          6,656         29,686         20,339         97,666
  Proceeds from notes payable                                      --             --          100,000        105,000        275,000
                                                            -----------    -----------    -----------    -----------    -----------

      Net Cash Flows Provided by Financing Activities           252,360        129,337      1,578,420        308,620      2,889,633
                                                            -----------    -----------    -----------    -----------    -----------

Net increase in cash                                                615          3,013            (81)           454            795

Cash and cash equivalents -  Beginning of period                    181          1,038            877            916           --
                                                            -----------    -----------    -----------    -----------    -----------

Cash and cash equivalents - End of period                   $       796    $     1,070    $       796    $     1,070    $       796
                                                            ===========    ===========    ===========    ===========    ===========

Schedule of Non-Cash Investing and Financing Activities:
--------------------------------------------------------
During 1998, the Company exchanged 1,000,000 restricted common shares for a profit sharing interest in 439 lode-mining claims.
The Company accrued interest on notes payable of $29,685 and $20,339 for the nine month periods ended September 30, 1999 and 1998,
    respectively. The Company has not paid any accrued interest. The Company has also recognized an additional $13,403 of imputed
    interest during 1999.

                                        See accompanying summary of accounting policies
                                                and notes to financial statements.

                                                                4
</TABLE>
<PAGE>


                              GOLDSTATE CORPORATION
                         (An Exploration Stage Company)
                     Notes to Unaudited Financial Statements
                               September 30, 1999

--------------------------------------------------------------------------------
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Goldstate  Corporation  (the Company) was incorporated on February 28, 1996
     under the laws of the State of Nevada.  The Company is an exploration stage
     company.

     The Company's  principal  operations are the exploration and development of
     439  unpatented  lode-mining  claims  in the State of Idaho  pursuant  to a
     profit sharing agreement as discussed in Note 4.

     Basis of Accounting
     -------------------

     The Company utilizes the accrual basis of accounting.  Financial statements
     have been prepared using generally accepted accounting principles.

     The  preparation  of financial  statements  in  conformity  with  generally
     accepted  accounting  principles  requires management to make estimates and
     assumptions   that  affect  certain   reported   amounts  and  disclosures.
     Accordingly, actual results could differ from those estimates.

     Research, Development and Exploration Costs
     -------------------------------------------

     Research, development and exploration costs are expensed as incurred.

     Cash Equivalents
     ----------------

     For purposes of the Statement of Cash Flows,  cash  equivalents are defined
     as investments with original maturities of three months or less.

     Going Concern and Continued Operations
     --------------------------------------

     As of  September  30, 1999,  the Company had not  generated  revenues  from
     operations. The Company's successful financial operations and movement into
     an operating  basis are solely  contingent on the  development  of the lode
     mining claims and related profit sharing agreement.  The Company expects to
     fund ongoing operations for the next twelve months through a combination of
     advances  and the  common  stock  offering  described  in Note 5, which has
     provided an additional  $870,000 of funding,  and  subsequent  offerings to
     commence after October 7, 1999.

                                        5

<PAGE>


                              GOLDSTATE CORPORATION
                         (An Exploration Stage Company)
                     Notes to Unaudited Financial Statements
                               September 30, 1999

--------------------------------------------------------------------------------
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

     Earnings Per Share
     ------------------

     As of September  30, 1999,  there were  1,000,000  options  exercisable  to
     purchase  common  stock  and  notes  payable  that can be  converted  in to
     1,375,000  shares of common stock. As these options and  convertible  notes
     payable would have an antidilutive  effect on the  presentation of loss per
     share, a diluted loss per share calculation is not presented.


NOTE 2: TECHNOLOGY SUB-LICENSE AGREEMENT

     In  March  of 1999,  the  Company  entered  into a  definitive  sub-license
     agreement  with Geneva  Resources,  Inc.  ("Geneva"),  to utilize assay and
     metallurgical  technology,  know-how, and rights to technological processes
     developed  for  the  Blackhawk   mineralization   by  Auric   Metallurgical
     Laboratories,  Inc. ("Auric"). This sub-license is for non-exclusive use in
     the  Company's  claim area in the State of Idaho for a period not less than
     40 years.  Pursuant to this  agreement,  the  Company was to issue  500,000
     restricted  common  shares to Geneva  Resources,  Inc.  ("Geneva")  and the
     Company also issued 1,000,000  restricted common shares to AuRIC.  Pursuant
     to the same  agreement  the Company  also issued  promissory  notes to both
     Geneva and AuRIC in the amount of  $250,000 to each  company.  These are 3%
     interest bearing notes and are payable upon the transfer of the technology.
     As these notes bear interest  below market  value,  the Company has used an
     imputed  interest  rate of 8%. The imputed value of these notes at issuance
     was $238,426 to each company.

     Pursuant to an  amendment  to the above  agreement,  the  Company  issued a
     convertible  promissory  note to Geneva in the amount of  $100,000  that is
     convertible  to 500,000  restricted  common  shares upon demand,  and bears
     simple  interest at the rate of 8% per annum.  This  promissory  note is in
     lieu of the 500,000  restricted  common shares  required by the  agreement.
     This  promissory  note is convertible  into 500,000 shares of the Company's
     common stock at the option of Geneva after October 7, 1999.

     As of September  30, 1999 the  promissory  notes and common stock have been
     issued to the various parties, however, the related technology has not been
     transferred.  These  promissory  notes  become  due and  payable  upon  the
     transfer of the  technology.  Transfer of the  technology  will occur after
     completion of pilot scale testing. The technology is scheduled for transfer
     during 1999,  however legal  proceedings initiated by Intergold Corporation

                                       6
<PAGE>

                              GOLDSTATE CORPORATION
                         (An Exploration Stage Company)
                     Notes to Unaudited Financial Statements
                               September 30, 1999

--------------------------------------------------------------------------------
NOTE 2: TECHNOLOGY SUB-LICENSE AGREEMENT (Continued)

     and Geneva  against  AuRIC and Dames & Moore may impact  the  schedule  for
     transfer (see Note 9 - Contingencies). The Company has expensed the amounts
     paid pursuant to the agreement as research and development expense.


NOTE 3: INVESTMENTS

     Investment in Profit Sharing Interest
     -------------------------------------

     On December 11, 1997, Intergold Corporation and its subsidiary entered into
     a profit sharing agreement with the Company.  Under terms of the agreement,
     Intergold  received  1,000,000  restricted  shares of  common  stock in the
     Company in exchange for the sale of a future profit sharing  interest.  The
     Company  will  be  responsible  to  provide  all  funding  and  will be the
     operating  partner.  The Company will  initially  retain 80% of the profits
     resulting  from the  agreement.  After the  Company  is  repaid  all of its
     invested  capital,  the profit  distribution will be 51% to the Company and
     49% to Intergold  Corporation.  There are 439 unpatented lode-mining claims
     that form the subject of this  arrangement  known as  Blackhawk  II.  These
     claims were transferred from Intergold  Corporation to the Company via quit
     claim deed on June 10, 1999. As of September 30, 1999 there were no jointly
     controlled assets pursuant to the agreement.

     The  Company  now  owns  a  profit  sharing   interest  in  439  unpatented
     lode-mining  claims.  As the  1,000,000  shares of common  stock  cannot be
     marketed  for a period  of twelve  months  from the date of  issuance,  the
     Company has valued the profit sharing  interest at 50% of the trading value
     as of the date of issuance, $170,000.

     The consolidation method is being utilized to account for the joint venture
     agreement  with  Intergold  Corporation.  The  Company  will have  majority
     accounting  control over the development of the claims. As of September 30,
     1999, no profit had been generated by the development of the claims.

     The sole director and officer of Goldstate  Corporation  is also a director
     of Intergold Corporation.

                                       7
<PAGE>

                              GOLDSTATE CORPORATION
                         (An Exploration Stage Company)
                     Notes to Unaudited Financial Statements
                               September 30, 1999

--------------------------------------------------------------------------------
NOTE 4: ADVANCES AND NOTES PAYABLE

     Advances are comprised of the following:

     Advances
     --------

     The Company at September 30, 1999 had advances,  payable on demand, bearing
     10% simple interest, to the following affiliated companies:

     Amerocan Marketing, Inc.                                      $ 46,500

     Tri-Star Financial Services, Inc.                                  527

     Investor Communications International, Inc.                    180,970
                                                                   --------

                                                                   $227,997
                                                                   ========


     Notes Payable
     -------------

     The Company had Notes Payable at September 30, 1999 as follows:

     Brent Pierce                                                 $  75,000
     Rising Sun Capital Corporation                                 100,000
     Geneva Resources, Inc.                                         100,000
     Geneva Resources, Inc.                                         250,000
        Discount for imputed interest on Geneva Resources, Inc.      (4,873)
     AuRIC Metallurgical Laboratories, LLC                          250,000
        Discount for imputed interest on AuRIC Labs                  (4,872)
                                                                  ---------
                                                                  $ 765,255
                                                                  =========


     Accrued  Interest  Payable to  September  30, 1999 from  Advances and Notes
     Payable was $97,666.

     The Company has entered into two  promissory  notes with Brent Pierce.  The
     first note,  dated July 31, 1997, is for $70,000.  The second note is dated
     February 3, 1998 and is for $5,000.  The notes bear an 8% interest rate and
     are due on demand. The notes are convertible, after October 7, 1999, at the
     option of the  holder  into  350,000  and  25,000  shares of common  stock,
     respectively.

     The Company has also issued a $100,000 note, dated March 5, 1998, to Rising
     Sun  Capital  Corporation.  The  note  bears  interest  at 8% and is due on
     demand.  The note is  convertible  at the option of the holder into 500,000
     shares of common stock.




                                        8
<PAGE>

                              GOLDSTATE CORPORATION
                         (An Exploration Stage Company)
                     Notes to Unaudited Financial Statements
                               September 30, 1999

--------------------------------------------------------------------------------
NOTE 4: ADVANCES AND NOTES PAYABLE (continued)

     Note  agreements   executed  in  1999  relate  to  requirements  under  the
     Technology  Sub-license  agreement  that the Company  executed on March 18,
     1999 (see Note 3).

     Pursuant  to the  Technology  Sub-license  agreement,  the  Company  issued
     promissory notes to both Geneva and AuRIC in the amount of $250,000 to each
     company.  These are 3%  interest  bearing  notes and are  payable  upon the
     transfer of the  technology.  These notes have been  discounted  to bear an
     imputed interest rate of 8%.

     Pursuant to an  amendment  to the  Technology  Sub-License  agreement,  the
     Company has issued a convertible promissory note to Geneva Resources,  Inc.
     ("Geneva")  in the  amount  of  $100,000  that is  convertible  to  500,000
     restricted common shares upon demand,  and bears interest at the rate of 8%
     per annum.


NOTE 5: STOCKHOLDERS' EQUITY

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

     Pursuant to a July 30, 1997 Offering  Memorandum,  the Company issued under
     SEC Rule 504 of  Regulation D,  2,625,000  shares of common stock at $.0003
     par value for  $525,000  during 1997 and 1998.  Pursuant to a March 3, 1998
     Offering  Memorandum,  the  Company has issued  1,500,000  shares of common
     stock at $.0003 par value for $300,000  during  1998.  The Company has also
     issued  1,000,000  common  shares to  Intergold  Corporation  pursuant to a
     profit  sharing  agreement  as detailed in Note 3.  Pursuant an $8,509 debt
     settlement  agreement,  the Company issued 42,500 shares of common stock on
     January 15, 1999. On March 18, 1999, the company issued 1,000,000 shares of
     common stock to AuRIC Metallurgical Laboratories, LLC pursuant to terms and
     conditions of the Technology  Sub-license  Agreement  executed on March 18,
     1999  as  detailed  in Note  2.  Pursuant  to a  March  15,  1999  Offering
     Memorandum,  the Company  has issued  4,350,000  shares of common  stock at
     $.0003 par value for $870,000.

     The private placement memorandum dated March 15, 1999 generated $870,000 of
     additional  operating  funds that will be utilized  primarily on management
     and  administration  relating to  development  programs  for  metallurgical
     technology  and planning for the Blackhawk II Property as well as repayment
     of advances to companies which provided past management  services,  and for

                                        9
<PAGE>


                              GOLDSTATE CORPORATION
                         (An Exploration Stage Company)
                     Notes to Unaudited Financial Statements
                               September 30, 1999

--------------------------------------------------------------------------------
NOTE 5: STOCKHOLDERS' EQUITY (continued)

     general  working  capital for the continued  exploration and development of
     the Company's Blackhawk II claims. As of April 6, 1999, the entire offering
     had been subscribed.

     Preferred Stock
     ---------------

     Pursuant to a Board resolution, the Corporation has authorized the creation
     of  preferred  stock  and  related   rights.   The  Company  also  filed  a
     "Certificate  of Designation  of Series A Preferred  Stock" with the Nevada
     Secretary of State on May 8, 1998. The Company has not issued any shares of
     preferred stock as of September 30, 1999.


NOTE 6: EMPLOYEE STOCK OPTION PLAN

     On March 1, 1999 the Company  authorized an Employee Stock Option Plan. The
     plan authorized the issuance of 1,500,000  options that can be exercised at
     $.15 per share of common stock.  Options  granted expire March 1, 2019. The
     options are  non-cancelable  once  granted.  Shares,  which may be acquired
     through the plan, may be authorized but unissued  shares of common stock or
     issued  shares of common  stock  held in the  Company's  treasury.  Options
     granted under the plan will not be in lieu of salary or other  compensation
     for services.

     During  the nine month  period  ending  September  30,  1999,  the Board of
     Directors of the Company  authorized  the grant of stock options to certain
     officers,  directors  and  consultants.  The options  granted  consisted of
     1,000,000 options with an exercise price of $.15 per share of common stock.
     Selected  information  regarding  the options as of September  30, 1999 and
     1998 are as follows:

                                         September 30, 1999   September 30, 1998
                                        --------------------  ------------------
                                                    Weighted           Weighted
                                        Number      Average    Number  Average
                                          of        Exercise     of    Exercise
                                        Options      Price     Options   Price
                                        -------      -----     -------   -----

     Outstanding at Beg. of Period        -0-         -0-        -0-      -0-
     Outstanding at End of Period      1,000,000   $.15/share    -0-      -0-
     Exercisable at End of Period      1,000,000   $.15/share    -0-      -0-
     Options Granted                   1,000,000   $.15/share    -0-      -0-
     Options Exercised                    -0-         -0-        -0-      -0-
     Options Forfeited                    -0-         -0-        -0-      -0-
     Options Expired                      -0-         -0-        -0-      -0-



                                       10
<PAGE>


                              GOLDSTATE CORPORATION
                         (An Exploration Stage Company)
                     Notes to Unaudited Financial Statements
                               September 30, 1999

--------------------------------------------------------------------------------
NOTE 6: EMPLOYEE STOCK OPTION PLAN (continued)

     As of September  30, 1999,  outstanding  options have an exercise  price of
     $.15  per  share.  The  weighted  average  exercise  price  of all  options
     outstanding  is $.15 per share of common  stock  and the  weighted  average
     remaining  contractual  life is 19 years  150  days.  There  are  1,000,000
     options that are exercisable with a weighted average exercise price of $.15
     per share of common stock.


NOTE 7: MANAGEMENT SERVICES AGREEMENT

     The Company has entered into a management  services agreement with Tri Star
     Financial  Services,   Inc  ("Tri  Star")  to  provide  management  of  the
     day-to-day  operations of the Company.  The management  services  agreement
     requires a monthly  payment not to exceed  $100,000 for services  rendered.
     This  contract  runs  from  January  1, 1999  through  June 30,  1999.  The
     individuals  comprising  the  management  team provided by Tri Star are the
     same individuals managing the operations of Intergold Corporation.

     The Company  entered  into a similar  management  services  agreement  with
     Investor  Communications,  Inc.  during the second  quarter.  This contract
     starts  July 1, 1999 and is for 24 months at a cost to not  exceed  $75,000
     per month for the first twelve  months.  The  management  team  provided by
     Investor Communications is the same group provided by Tri Star.

     The sole  director and officer of the Company is not an officer,  director,
     employee or a part of the management  team provided by Tri Star or Investor
     Communications, Inc.

NOTE 8: INCOME TAXES

     The Company incurred an operating loss for the year ended December 31, 1998
     and 1997 of $410,255, and $804,176,  respectively.  The Company had adopted
     FASB No. 109 for reporting purposes.

     As of December 31, 1998 and 1997,  the Company had net operating loss carry
     forwards of $1,218,595 and $808,340, respectively, which expire between the
     years 2006 - 2012.  The  deferred  tax assets  resulting  from these  carry
     forwards were as follows:


                                       11
<PAGE>


                              GOLDSTATE CORPORATION
                         (An Exploration Stage Company)
                     Notes to Unaudited Financial Statements
                               September 30, 1999

--------------------------------------------------------------------------------
NOTE 8: INCOME TAXES (continued)



                                             1998         1997
                                             ----         ----
     Deferred Tax Asset                   $ 414,322    $ 274,836

     Less Valuation of Net Assets          (414,322)    (274,836)
                                          ---------    ---------

     Balance at End of Year               $     -0-    $     -0-
                                          =========    =========



NOTE 9: CONTINGENCIES

     On  October 8,  1999,  Intergold  Corporation's  wholly  owned  subsidiary,
     International Gold Corporation  ("IGC") joined a legal complaint  initiated
     by Geneva Resources,  Inc., against AuRIC Metallurgical  Laboratories,  LLC
     ("AuRIC"),  Dames & Moore,  Ahmet Altinay,  General  Manager of AuRIC,  and
     Richard Daniele,  Chief  Metallurgist for Dames & Moore. The damages sought
     by IGC/Geneva are to be determined in court. The damages incurred stem from
     reliance on assays and  representations  made by AuRIC and upon actions and
     engineering  reports  produced by Dames & Moore.  IGC/Geneva  also  alleges
     there were  breaches of  contract by AuRIC and Dames and Moore,  as well as
     other  causes of  action.  This legal  proceeding  may affect the timing of
     technology to be transferred  from Geneva to the Company that was scheduled
     initially before the end of 1999.







                                       12

<PAGE>


Item 2. Management's Discussion and Analysis or Plan of Operation

Results of Operation
--------------------

Quarter Ended September 30, 1999 compared to September 30, 1998
---------------------------------------------------------------

     For the three-month period ended September 30, 1999, the Company recorded a
net loss of $252,944  compared  to a net loss of  $127,824 in the  corresponding
period of 1998.  During the  three-month  period  ended  September  30, 1999 and
September 30, 1998, the Company recorded no income.

     During the  three-month  period  ended  September  30,  1999,  the  Company
recorded  operating  expenses of  $234,059 as compared to $121,168 of  operating
expenses  recorded in the same period for 1998.  Property  exploration  expenses
increased slightly in the approximate amount of $1,965 in the three-month period
during 1999  primarily  because of a slight  increase in the claims  maintenance
fees  and  exploration  and  staking  costs.  However,  administrative  expenses
increased  significantly by approximately  $110,926 in the three-month period in
1999  compared  to 1998.  This  increase  was due  primarily  to an  increase in
overhead and  administrative  expenses  resulting from the increasing  scale and
scope  of  overall  corporate   activity   pertaining  to  the  exploration  and
administration of the property.

Nine Months Ended September 30, 1999 compared to September 30, 1998
-------------------------------------------------------------------

     For the nine-month  period ended September 30, 1999, the Company recorded a
net loss of $1,578,770 compared to a net loss of $312,666 in the corresponding
period of 1998.  During the  nine-month  period  ended  September  30,  1999 and
September 30, 1998, the Company recorded no income.

     During the nine-month period ended September 30, 1999, the Company recorded
operating  expenses of $1,535,682 as compared to $292,327 of operating  expenses
recorded in the same period for 1998.  Property  exploration  expenses increased
significantly  in the  approximate  amount of $668,817 in the nine-month  period
during 1999  primarily  due to the amounts  paid by the Company as research  and
development  expenses associated with the service agreement dated March 18, 1999
between Geneva Resources,  Inc. and AuRIC Metallurgical  Laboratories,  LLC (the
"Service  Agreement") and the  corresponding  technology  sub-license  agreement
dated  March 19,  1999  between the  Company  and Geneva  Resources,  Inc.  (the
"Sub-License  Agreement").  Administrative expenses also increased approximately
$574,538 in the  nine-month  period during 1999 compared to 1998.  This increase
was due  primarily  to an  increase  in  overhead  and  administrative  expenses
resulting from the increasing scale and scope of the overall corporate  activity
pertaining to exploration and administration of the property.

Liquidity and Capital Resources
-------------------------------

     As of the nine-month  period ended  September 30, 1999, the Company's total
assets were $170,796.  This slight  decrease from fiscal year ended December 31,
1998 was due primarily to a decrease in cash and cash equivalents. The Company's
assets consists primarily of the valuation of $170,000 of the Company's interest
in  the  mining  claims  pursuant  to the  Joint  Venture  Agreement.  As of the
nine-month period ended September 30, 1999, the Company's total liabilities were
$1,120,926.  This overall  increase from fiscal year ended December 31, 1998 was
due primarily to the promissory notes issued by the Company to Geneva Resources,
Inc. and AuRIC Metallurgical  Laboratories,  LLC. in the amount of $250,000 each
pursuant to the terms and conditions of the Sub-License Agreement.

     Stockholders'  Equity  (deficit)  decreased from $(386,368) for fiscal year
ended  December  31,  1998 to  $(996,630)  for  the  nine-month  period  ended
September 30, 1999.

                                       13
<PAGE>


PART II. OTHER INFORMATION


Item 1. Legal Proceedings
-------------------------

     On  September  27,  1999,   International   Gold   Corporation,   Intergold
Corporation's  subsidiary,  and Geneva  Resources,  Inc.,  a Nevada  corporation
("Geneva") initiated legal proceedings against AuRIC Metallurgical Laboratories,
LLC, a Utah limited  liability  company  ("AuRIC") and Dames & Moore, a Delaware
corporation  ("Dames & Moore"), by filing its complaint in the District Court of
the Third Judicial District for Salt Lake City, State of Utah.

     International  Gold  Corporation  and AuRIC had previously  entered into an
agreement for services  dated March 18, 1999 (the "Service  Agreement")  whereby
AuRIC  agreed  to  perform  certain  services,   including  the  development  of
proprietary technology and know-how relating to fire and chemical assay analysis
techniques and metallurgical ore extraction  procedures  developed  specifically
for mining  claims  located on  properties of  International  Gold  Corporation.
Geneva and AuRIC also entered into a technology  License  Agreement  dated March
17,  1999  (the  "License   Agreement")  whereby  AuRIC  agreed  to  supply  the
proprietary  technology  to Geneva  and  grant to  Geneva a license  to use such
technology on various claims owned by Geneva,  and AuRIC also granted Geneva the
right to sub-license  the  proprietary  technology to the Company for use on the
Blackhawk II Property. Dames & Moore subsequently verified the fire and chemical
assay  techniques  and  procedures  developed by AuRIC and their  repeatability.
International  Gold Corporation  subsequently  entered into multiple work orders
with Dames & Moore relating to a variety of services,  such as professional  and
independent  project  management,  project cost control,  geological mapping and
studies,  permitting  and land use,  chain of custody  drill sample  collection,
environmental  assessment reports,  survey mapping  petrographic  studies,  data
management  and  data  entry,  chain  of  custody  assay  database,   geographic
information systems, development geology, project control,  scheduling,  geology
support, chain of custody protocols, laboratory evaluations, public involvement,
and field mobilizations.

     International  Gold  Corporation  and Geneva  initiated  legal  proceedings
against  AuRIC for (i) multiple  breaches of contract  relating to the Agreement
for Services and the License Agreement, respectively, including, but not limited
to, establishment and facilitation of the proprietary  technology and fire assay
procedures developed by AuRIC at an independent assay lab and failure to deliver
the proprietary  technology and procedures to  International  Gold  Corporation,
Geneva and Dames & Moore;  (ii) breach of the implied covenant of good faith and
fair dealing; (iii) negligent misrepresentation;  (iv) specific performance; (v)
non-disclosure  injunction;  (vi) failure by AuRIC to repay advances;  and (vii)
quantum  meruit/unjust  enrichment.  The Company also named Dames & Moore in the
legal proceeding in a declaratory relief cause of action.

     International  Gold  Corporation  and Geneva are  reviewing  further  legal
remedies against AuRIC and Dames & Moore and intends to aggressively  pursue any
and all such actions.

Although the legal proceedings outlined above do not affect the Company directly
at this point in time, this legal proceeding may affect the timing of technology
to be  transferred  from  Geneva  to the  Company  according  to the  terms  and
conditions  of the  sub-license  agreement  entered into between the Company and
Geneva that was scheduled to be completed before the end of 1999.


Item 2. Changes in Securities and Use of Proceeds
-------------------------------------------------

No report required.

Item 3. Defaults Upon Senior Securities
---------------------------------------

No report required.

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

No report required.

Item 5. Other Information
-------------------------

No report required.

Item 6. Exhibits and Reports on Form 8-K
----------------------------------------

(a)  No exhibits required.

(b)  No reports required.


                                       14
<PAGE>


SIGNATURES

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

                                                 GOLDSTATE CORPORATION

Dated: November 12, 1999                         By: /s/ Grant Atkins
                                                  ------------------------------
                                                  Grant Atkins, President


Dated: November 12, 1999                         By: /s/ Grant Atkins
                                                  ------------------------------
                                                  Grant Atkins, Secretary






                                       15