UNITED STATES
                       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 June 30, 2001
                                      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 No. 333-46424

                                E-City Software, Inc.
            (Exact name of Registrant as specified in its charter)

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

           Nevada                                               88-0461317
(State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                            Identification Number)

                             1201 First Avenue South
                                    Suite 330
                                Seattle, WA 98134
                       (Address, including zip code, of
                   Registrant's principal executive offices)
      Registrant's telephone number, including area code: (206) 624-8070

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

     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 [_]

     There were 4,965,000 shares of the Company's Common Stock, par value
$0.0001, outstanding on August 1, 2001.

================================================================================
<PAGE>
                                       2

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S>          <C>                                                                                      <C>
PART I.       FINANCIAL INFORMATION................................................................   3

Item 1        Financial Statements.................................................................   4

              Condensed Consolidated Balance Sheets.................................................  4
              Condensed Consolidated Statements Of Operations.......................................  5
              Condensed Consolidated Statements Of Cash Flows.......................................  6
              Notes To Condensed Consolidated Financial Statements..................................  7

Item 2        Management's Discussion and Analysis of Financial Condition and Results of Operations.  9

PART II       OTHER INFORMATION....................................................................  17

Item 1        Legal Proceedings....................................................................  17

Item 2        Changes in Securities................................................................  17

Item 3        Defaults upon Senior Securities......................................................  17

Item 4        Submission of Matters to a Vote of Security Holders..................................  17

Item 5        Other Information....................................................................  17

Item 6        Exhibits and Reports on Form 8-K.....................................................  17

Signature..........................................................................................  18
</TABLE>
<PAGE>
                                       3


                          PART I FINANCIAL INFORMATION

Cautionary Statement Regarding Forward-Looking Statements

     This Quarterly Report on Form 10-QSB contains forward-looking statements.
These statements relate to our, and in some cases our customers' or partners',
future plans, objectives, expectations, intentions and financial performance,
and the assumptions that underlie these statements. These forward-looking
statements include, but are not limited to, statements regarding the following:

    . the anticipated market trends and uncertainties;

    . the anticipated cost of our revenues;

    . our expectations concerning our sales and marketing expenses;

    . the anticipated increases in our operating expenditures, including
      research and development, sales and marketing expenses and general and
      administrative expenses;

    . the anticipated additional capital expenditures; and

    . the adequacy of our capital resources to fund our operations;


     These statements involve known and unknown risks, uncertainties and other
factors that may cause industry trends or our actual results, level of activity,
performance or achievements to be materially different from any future results,
levels of activity, performance or achievements expressed or implied by these
statements. These factors include those listed under "Management's Discussion
and Analysis of Financial Condition and Results of Operations" in this Quarterly
Report on Form 10-QSB.

     Although we believe that expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results, levels of
activity, performance or achievements. We will not update any of the forward-
looking statements after the date of this Quarterly Report on Form 10-QSB to
conform these statements to actual results or changes in our expectations,
except as required by law. You should not place undue reliance on these forward-
looking statements, which apply only as of the date of this Quarterly Report on
Form 10-QSB.
<PAGE>
                                       4



ITEM 1.  FINANCIAL STATEMENTS

                                E-CITY SOFTWARE, INC.

                      CONDENSED CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                       June 30,                    March 31,
                                                                        2001                       2001 (1)
                                                                      ----------                 -----------
<S>                                                                   <C>                         <C>
                             ASSETS                                  (unaudited)

Current assets:
  Cash and cash equivalents.....................................      $  34,847                   $  40,290
  Accounts receivable...........................................        382,790                     109,000
  Contract work in progress.....................................         94,851                     192,243
  Related parties notes receivable..............................         74,917                      74,917
  Prepaid expenses and other current assets.....................         23,546                       9,327
  Related party advances........................................            ---                       3,207
                                                                      ---------                   ---------
       Total current assets.....................................        610,951                     428,984

Property and equipment, net.....................................        103,096                     110,283
Deferred tax asset..............................................         31,296                      19,421
Other assets....................................................            690                         724
                                                                      ---------                   ---------
Total assets....................................................      $ 746,033                   $ 559,412
                                                                      =========                   =========

               LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
  Accounts payable..............................................      $  48,484                   $  36,258
  Accrued expenses..............................................         31,633                      29,890
  Related party advances........................................        333,896                     321,173
  Deferred revenue..............................................            ---                      25,000
  Accrued income taxes..........................................         84,102                      21,961
  Capital lease obligations, current portion....................          3,720                       3,507
                                                                      ---------                   ---------
       Total current liabilities................................        501,835                     437,789

Capital lease obligations, net of current portion...............          9,742                      10,275
Deferred income taxes...........................................         20,759                      42,293
                                                                      ---------                   ---------
Total Liabilities...............................................        532,336                     490,357

Stockholder's equity:
  Common stock, $0.0001 par value, 50,000,000 shares............
  authorized, 4,965,000 shares issued and outstanding...........            497                         497
Retained earnings...............................................        224,188                      85,503
Accumulated other comprehensive income (loss)...................        (10,988)                    (16,945)
                                                                      ---------                   ---------
       Total stockholders' equity...............................        213,697                      69,055
                                                                      ---------                   ---------
       Total liabilities and stockholders' equity...............      $ 746,033                   $ 559,412
                                                                      =========                   =========
</TABLE>
--------------
(1) The balance sheet at March 31, 2001 has been derived from the audited
    consolidated financial statements at that date, but does not include all the
    information and footnotes required by generally accepted accounting
    principles for complete financial statements.

                             See accompanying notes.


<PAGE>
                                       5



                                E-CITY SOFTWARE, INC.

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                                Three months ended
                                                                                June 30,
                                                                    ------------------------------------
                                                                         2001                  2000
                                                                       --------             ---------
<S>                                                                    <C>                  <C>
Sales...........................................................      $ 500,000            $      ---

Cost of Goods Sold..............................................        206,009                   ---
                                                                       --------               --------
         Gross Profit...........................................        293,991                   ---

Operating Expenses
 Sales and marketing............................................         46,040                   ---
 Research and development.......................................            ---                   ---
 General and administrative.....................................         87,757                26,931
                                                                       --------               --------
   Total Operating Expenses.....................................        133,797                26,931
                                                                       --------               --------
Income (loss) from operations...................................        160,194               (26,931)

Other Income (Loss)
 Interest income................................................            970                    17
 Gain (loss) on foreign currency exchange.......................          3,610                (2,627)
                                                                       --------               --------
         Net Other Income (Loss)................................          4,580                (2,610)
                                                                       --------               --------
Income (Loss) Before Provision For Income Taxes.................        164,774               (29,541)
                                                                       --------               --------
Provision For Income Taxes......................................         26,089                   ---
                                                                       --------               --------
Net Income (Loss)...............................................      $ 138,685             $ (29,541)
                                                                      =========             ==========
Basic and Diluted Income (Loss) Per Share.......................       $   0.03             $   (0.01)
                                                                      =========             ==========
Shares used in computing basic and diluted net loss per share
 applicable to common stockholders..............................      4,965,000              4,740,000
                                                                      =========             ==========
</TABLE>

                             See accompanying notes.


<PAGE>
                                       6


                              E-CITY SOFTWARE, INC.

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                         Three months ended June 30,
                                                                     ------------------------------------
                                                                       2001                        2000
                                                                     --------                    --------
<S>                                                                  <C>                         <C>
Operating activities:
Net income (loss)...............................................    $ 138,685                   $(29,541)
Adjustments to reconcile net income (loss) to
net cash from operating activities:
  Foreign exchange (gain) loss..................................       (3,610)                     2,627
  Depreciation and amortization.................................       12,121                      6,532
  Deferred tax provision........................................      (22,858)                       ---
Changes in operating assets and liabilities:
      Accounts receivable.......................................     (265,390)                      (378)
      Related parties advances receivable.......................          711                        ---
      Work in process...........................................      103,268                   (139,126)
      Prepaid expenses..........................................      (13,590)                    (3,481)
      Accounts payable and accrued expenses.....................       12,893                     (6,095)
      Related parties advances payable..........................       18,124                        ---
      Deferred revenue..........................................      (25,000)                   208,000
      Accrued income tax........................................       48,269                        ---
                                                                     ---------                  ---------
         Net cash provided by (used in) operating activities....        3,623                     38,538
                                                                     ---------                  ---------
Investing activities:

  Purchases of property and equipment...........................         (495)                   (22,956)
                                                                     ---------                  ---------
         Net cash provided by (used in) investing activities....         (495)                   (22,956)
                                                                     ---------                  ---------
Financing activities:
  Principal payments of long term debt..........................         (871)                      (842)
  Borrowings under long term debt...............................          ---                        ---
                                                                     ---------                  ---------
         Net cash provided by (used in) financing activities....         (871)                      (842)
                                                                     ---------                  ---------
            Effect of exchange rate changes on cash................    (7,700)                    (1,909)
                                                                     ---------                  ---------
Net increase (decrease) in cash and cash equivalents............       (5,443)                    12,831

Cash and cash equivalents at beginning of period................       40,290                     14,658
                                                                     ---------                  ---------
Cash and cash equivalents at end of period......................     $ 34,847                   $ 27,489
                                                                     =========                  =========

</TABLE>
                             See accompanying notes.


<PAGE>
                                       7


                                E-CITY SOFTWARE, INC.

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (unaudited)


NOTE 1.   BASIS OF PRESENTATION

     The consolidated financial statements have been prepared by
E-City Software, Inc., pursuant to the rules and regulations of the Securities
and Exchange Commission and include the accounts of E-City Software, Inc. and
its wholly owned subsidiary (collectively "E-City" or the "Company"). Certain
information and footnote disclosures, normally included in financial statements
prepared in accordance with generally accepted accounting principles, have been
condensed or omitted pursuant to such rules and regulations. While in the
opinion of the Company, the unaudited financial statements reflect all
adjustments (consisting only of normal recurring adjustments) necessary for a
fair presentation of the financial position at June 30, 2001 and the operating
results and cash flows for the three months ended June 30, 2001 and 2000, these
financial statements and notes should be read in conjunction with the Company's
audited consolidated financial statements and notes for the year ended March
31, 2001 included in the Company's Annual Report on Form 10-KSB filed June 28,
2001 with the Securities and Exchange Commission. The condensed consolidated
balance sheet at March 31, 2001 has been derived from audited financial
statements as of that date.

     The results of operations for the three months ended June 30, 2001 are not
necessarily indicative of results that may be expected for any other interim
period or for the full fiscal year ending March 31, 2002.

NOTE 2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation - The accompanying consolidated financial statements
include the accounts of E-City Software, Inc and it's wholly owned subsidiary.
Inter-company transactions and accounts have been eliminated in consolidation.

Software Revenue -- Revenue from licenses of the interactive guides is
recognized when delivery is complete, and no significant obligations remain
unfulfilled by the Company and when collection of any remaining receivable is
probable. Payments collected prior to revenue recognition are accounted for as
deferred revenue.

<PAGE>
                                       8


Contract Work In Progress -- In accordance with Financial Accounting Standards
Board ("FASB") Statement of Financial Accounting Standards ("SFAS") No. 86,
"Accounting for the Costs of Computer Software to be Sold, Leased or Otherwise
Marketed" development costs incurred in the research and development of new
software products to be sold, leased or otherwise marketed are expensed as
incurred until technological feasibility in the form of a working model has been
established. Subsequent costs to produce the computer software are accumulated
as an asset, "contract work in progress", and recorded as costs of goods sold
when revenue is recognized. Contract work in progress for projects that are not
expected to be included in costs of good sold during the twelve months following
the balance sheet date are recorded as long-term costs in the "other assets"
section of the balance sheet. Contract work in progress that is expected to be
recorded as costs of sales within the next twelve months is included in current
assets. As of June 30, 2001 and March 31, 2001 all projects for which costs have
been incurred are expected to be complete within twelve months and, accordingly,
contract work in progress is included in current assets.

Foreign Currency Translation -- Monetary assets and liabilities which are
denominated in currencies other than Canadian Dollars are translated at the
exchange rate in effect at the balance sheet date. Revenue and expense items are
translated at rates of exchange prevailing on the transaction dates. All
exchange gains or losses are recognized currently in earnings.

For reporting purposes, the financial statements have been translated into
United States Dollars. Assets and liabilities are translated at the exchange
rate in effect on the balance sheet date. Revenue and expense items are
translated at an average exchange rate. Translation adjustments representing
translation gains or losses are recorded as a component of comprehensive income.


<PAGE>
                                       9


     The following information should be read in conjunction with the Company's
Annual Report on Form 10-KSB filed on June 28, 2001 with the Securities and
Exchange Commission.

ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS

Overview

     E-City Software, Inc. is a Nevada corporation formed on May 12, 2000 for
the purpose of developing and commercializing computer mapping products in
cd-rom format and on the internet for internet sites and other businesses that
utilize computerized mapping services. The Company develops and markets products
that allow our clients to provide computerized mapping services to their
customers. Our subsidiary, Butterfly Software, Inc., a British Columbia
corporation, was formed on November 8, 1998 for the purpose of producing
computerized maps. In its original conception, Butterfly was to make
computerized maps in the form of maps of popular tourist destinations which it
planned to sell to wholesale and retail customers on cd-rom in a screen saver
format. In September of 1999, Butterfly changed its business model and began
focusing on the delivery of computer maps via the internet, as well as in cd-rom
format. Butterfly Software became a wholly owned subsidiary of E-City on August
15, 2000. E-City purchased 100% of the stock of Butterfly Software on August 15,
2000 in exchange for 50,000 shares of common stock of E-City.

    We intend over the next 12 months, to add two new products to our currently
available product offering. Presently, we are in the process of developing 10
computer maps of North American cities under our software development contract
with Cityscape.com. Our only currently offered product consists of this computer
map product that we can create for potential customers on a city by city basis,
under similar terms as the contract that we entered into with Cityscape.

    In addition to the custom computer map development services described above,
E-City has two other products in development, which it plans to begin selling in
the third quarter of 2001. These are a licensed, on-line version of its maps to
internet websites and a paper map of its completed cities.

    E-City intends to license its on-line maps either through resellers or
directly to individual websites. These websites would pay an annual licensing
fee to use E-City maps on their website. E-City intends to offer multiple levels
of animation on these maps, different user interface options, some customization
of the maps, for instance, highlighting a business' physical location on the
electronic map and intends to price these additions as value added services to
be paid for as upgrades to a simple license of E-City's current mapping product.
E-City currently has the ability to license the completed city maps of Seattle,
San Francisco, Las Vegas, Los Angeles, Washington DC, Vancouver, BC and Chicago.
E-City also intends to license a less detailed, more traditional computer map, a
so-called two dimensional or 2D map of the United States in conjunction with
licenses of its visually more detailed city maps which include buildings and
landmarks, or three dimensional or 3D maps. The 2D map capability is presently
ready to be licensed to customers in connection with E-City's other 3D
product.

<PAGE>
                                       10


    E-City has not determined a price for its computer map licensing product or
the price of the value added upgrades to such a license. E-City intends to base
its prices on the prevailing market prices for similar services by its
competitors, including Mapquest and Vicinity. Mapquest and Vicinity price
similar products between $1500 and $15,000 per year for each site license,
depending on the number of upgrade options requested. E-City intends to have a
similar pricing structure, depending on market research, feedback from its
potential customers, and the level of interest that it finds in the marketplace
for its products.

    E-City is in the process of developing a paper map printed version of its
computer city maps. E-City has completed such a paper map for Seattle and Las
Vegas. E-City intends to complete paper maps for San Francisco, Los Angeles,
Chicago, Washington DC and Vancouver, B.C. by September 30, 2001. E-City intends
to complete additional paper maps for other cities as it completes market
research on potential cities by the end of the third quarter of 2001. E-City
intends to price these maps at retail for between $5-$8 per map, depending on
the feedback received from potential distributors and potential customers.
Depending on the distribution method that E-City selects, E-City would receive
between 33% to 60% of the retail price of the paper maps.

    Presently, E-City has one distributor of its products in Germany and no
distributor outside of Germany. E-City is currently looking for other strategic
partners who might be resellers of the E-City computer map licensing products.
E-City has not determined how it will price such services with respect to
resellers. E-City currently offers products to its German distributor for 70% of
the sales price of products but has not determined if this pricing structure
will be practicable for markets outside of Germany. Management contemplates that
pricing in other markets will be done on a revenue-share basis, to be negotiated
with a reseller once a possible reseller or resellers have been identified. Such
pricing will be determined by the likely volume of sales a reseller might make,
any minimum order commitments a reseller might give, any synergies the reseller
might provide for E-City's other products, any marketing or brand awareness for
E-City that the reseller might provide, the depth and quality of the reseller's
customer base and the number of offers from competing resellers that E-City
receives.

<PAGE>
                                       11


Results of Operations

    Revenues were $500,000 during the three months ended June 30, 2001 and $0
during the three months ended June 30, 2000. Revenue increased as a result of
the completion of two interative city guides under the Cityscape software
development agreement as well as the completion of the city of Munich for our
German distributor. As of June 30, 2000, the Company had not completed work on
any cities as part of its development agreement with Cityscpae.

    Revenue from the sale of the interactive guides is recognized when delivery
is complete, and no significant obligations remain unfulfilled by E-City and
when collection of any remaining receivable is probable. Payments collected
prior to revenue recognition are accounted for as deferred revenue.

    At the moment, E-City's largest customer is Cityscape.com. Cityscape pays
E-City under a software development contract to develop 10 interactive maps to
North American cities. E-City anticipates that its sources of revenue in the
future will come from sales of its custom mapping development services to
websites under software development agreements similar to the one entered into
with Cityscape.com. E-City also anticipates that revenue will be derived from
license fees for its computer maps to individual websites on an annual license
fee basis. E-City also anticipates that revenue will be generated by sales of
E-City's paper map products.

    Cost of revenue. Cost of revenues were $206,009 during the three
months ended June 30, 2001 and $0 during the three months ended June
30, 2000. Cost of revenue increased as we had yet to recognize any revenue
during the three months ended June 30, 2000. We expect that our cost of revenue
will increase in the next fiscal quarter due to an expected increase in
headcount as a result of expansion initiatives.

Operating Expenses

     Sales and marketing. Sales and marketing expenses were $46,040 during
the three months ended June 30, 2001 and $0 during the three months
ended June 30, 2000. Sales and marketing expenses increased solely as a
result of an increase in the sales force and attendance at trade shows.
We expect sales and marketing expenses to increase substantially over the
remainder of the year if E-City is successful in developing and marketing its'
paper mapping products and computer mapping licenses and in obtaining
new customers for its products and services. We anticipate that such
expenditures could be as high as $125,000 or more depending on the level of
growth.

<PAGE>
                                       12


     General and administrative. General and administrative expenses were
$87,757 during the three months ended June 30, 2001 and $26,931 during the
three months ended June 30, 2000. General and administrative expenses increased
primarily as a result of increases in administrative and management personnel
as well as increased legal and professional expenses necessary as part of the
Company's decision to go public. We expect that our general and administrative
costs will be proportionaly higher in the next fiscal quarter depending on the
success of our sales efforts.

     Research and development. Research and development expenses were $0 during
the three months ended June 30, 2001 and 2000 due to the fact that our core
software development of our interactive city guide had already been completed.
At the moment, we have not spent money in the development of our paper mapping
products. We anticipate that spending will increase significantly on product
development during the next fiscal quarter.

   Interest and other income (expense). Interest and other income (expense), was
an income of $4,580 during the three months ended June 30, 2001, and was an
expense of $2,610 during the three months ended June 30, 2000. This decrease
of expense was due primarily to changes in the exchange rates between US and
Canadian dollars and the accrued interest from the promissory note with
Cityscape.

   Provision for income taxes. We have recorded $26,089 as a provision for
income taxes during the three months ended June 30, 2001 and $0 for the three
months ended June 30, 2000.  This increase is due to the increase in net income
over the respective periods.

Financial Condition

    For the quarter ended June 30, 2001 E-City had net income of $138,685 while
for the quarter ended June 30, 2000, the Company had incurred net losses of
$29,541. Also, for the quarter ended June 30, 2001, the Company had a
working capital surplus of $109,116 while for the quarter ended June 30, 2000,
the Company had a working capital deficit of $170,417.

    E-City has formulated a plan involving several efforts including an
increased marketing effort to contact potential customers. Expenses and costs
are also being examined to determine their need and effectiveness to meet the
Company's goals. Various equity sources are also being explored in order to
generate cash if needed. Along with exploring equity sources, E-City is also
pursuing financing options, although nothing specific has yet been established
with an investor or financing party. If needed, E-City has also considered
cutting back on its projects which would entail a reduction of force and related
expenses and curtailment of certain advertising and marketing efforts.

    The Company currently has limited cash reserves. There are
reserves of less than three month's of operating cash and payments from
Cityscape under the software development agreement cannot be assured. There can
be no assurance that E-City will develop any new customers, or that its pricing
arrangement with such customers, if located, will be sufficient to provide
E-City with the financial resources necessary to continue operation.

<PAGE>
                                       13


Liquidity and capital resources

    The Company continues to finance its growth primarily through funds
generated from operations. For the quarter ended June 30, 2001, net cash
provided by operating activities was $3,623. As of June 30, 2001, we had cash
and cash equivalents of $34,847. Net cash provided by operating activities was
$38,538 for the three months ended June 30, 2000. Net cash provided by operating
activities for the three months ended June 30, 2001 was primarily the result of
a net income, a decrease in work in progress and an increase in accrued income
tax offset by increases in accounts receivable. Net cash provided by operating
activities for the three months ended June 30, 2000, was primarily attributable
to the increase in deferred revenue offset by a net loss as well as increases in
work in progress.

     Net cash used in investing activities was $495 for the three
months ended June 30, 2001. Net cash used in investing activities was $22,956
for the three months ended June 30, 2000. Net cash used in investing activities
for the three months ended June 30, 2001 consisted entirely from the purchase of
software related to our filing requirements with the SEC.  Net cash used in
investing activities for the three months ended June 30, 2000 consisted
of investments in capital equipment.

     Net cash used in financing activities was $871 for the three months ended
June 30, 2001 and $842 for the three months ended June 30, 2000. Net cash used
in financing activities for the three months ended June 30, 2001 and 2000 were
attributable to lease payments associated with a Company vehicle.

     For the quarters ended June, 2001 and 2000, the Company had contract work
in progress of $94,851 and $211,690, respectively. Contract work in progress
represents the costs to produce our software products and is accumulated as an
asset and recorded as costs of goods sold when revenue is recognized. Management
has elected to include into work in progress a portion of general and
administrative costs based on a reasonable usage for the direct production of
our software products. Other direct costs are included at 100% until the
revenue is recognized.

     Work on our Airport Maps and Vehicle Dispatch System contributed $ 68,504
and $26,347 respectively towards work in progress during the three months ended
June 30, 2001. Work in progress for projects that are not expected to be
included in costs of good sold during the twelve months following the balance
sheet date are  recorded  as long-term  costs in the "other assets" section of
the balance sheet. Contract work in progress  that is  expected to be recorded
as costs of sales within the next twelve  months is included in current assets.
As of June 30, 2001,  all projects for which costs have been incurred are
expected to be completed  within twelve months and, accordingly, contract work
in progress is included in current assets.

<PAGE>
                                       14


        As of June 30, 2001, our principal commitments consisted of obligations
outstanding under related party advances. We have no material commitments for
capital expenditures. In the next fiscal quarter, we expect no significant
capital expenditures or lease commitments.

     We believe that our current cash balances, including cash, cash equivalents
and restricted cash, will be sufficient to meet our working capital and capital
expenditure requirements for less than three months. Nevertheless, we may
seek additional capital through private equity, equipment lease facilities, bank
financings or other types of financing. Capital requirements will depend on many
factors, including the rate of sales growth, market acceptance of our services,
costs of providing our services, the timing and extent of research and
development projects and levels of our operating expenses. To the extent that
existing cash and cash equivalents balances and any cash from operations are
insufficient to fund our future activities, we may need to raise additional
funds through public or private equity or debt financing. In addition, although
there are no present understandings, commitments or agreements with respect to
any acquisition of other businesses, services, products and technologies, we may
from time to time evaluate potential acquisitions, which could increase our
capital requirements.

     While E-City is optimistic about the Company's long-term prospects, the
following issues and uncertainties, among others, should be considered in
evaluating its growth outlook.

     We need working capital to execute our business plan and, in the future, we
may acquire or make investments in complementary businesses, products, services
or technologies on an opportunistic basis when we believe they will assist us in
carrying out our business strategy. We do not have any present understanding,
nor are we having any discussions relating to any such acquisition or
investment. Any such acquisition or investment could harm our operating results
or cause our stock price to decline because:

-    the  amount  of time  and  level  of  resources  required  to  successfully
     integrate its business operation could be substantial;
-    challenges  in  assimilating  personnel,   organizational   structure,  and
     technology could cause  significant  delays in executing other key areas of
     our business plan;
-    the key  personnel of the  acquired  company may decide not to work for us,
     which could result in the loss of key  technical  or business  knowledge to
     us; and
-    we may have to incur debt or issue equity  securities to pay for any future
     acquisitions,  the  issuance of which  could be  dilutive  to our  existing
     stockholders.

     We believe that our current cash and cash equivalents will be sufficient to
meet our  anticipated  cash needs for working  capital and capital  expenditures
through  October 2001. If cash generated from  operations is  insufficient to
satisfy  our  liquidity  requirements  after  that  date,  we may  seek  to sell
additional equity or debt securities or to obtain a credit facility; however, at
the present time, we have not entered into any  arrangements  or  understandings
with  respect  to  any  such  financings.  The  sale  of  additional  equity  or
convertible  debt  securities  could  result  in  additional   dilution  to  our
stockholders.  The incurrence of indebtedness would result in an increase in our
fixed  obligations  and could result in operating  covenants that would restrict
its  operations.  There can be no assurance  that financing will be available in
amounts or on terms  acceptable  to us, if at all. If financing is not available
when  required or is not  available  on  acceptable  terms,  we may be unable to
develop or enhance our  products or services.  In addition,  we may be unable to
take advantage of business  opportunities  or respond to competitive  pressures.
Any of these events could have a material  and adverse  effect on our  business,
results of operations and financial condition.

<PAGE>
                                       15


Cash requirements

    Presently, without the sale of additional shares, we do not have sufficient
capital to maintain, grow or continue our operations for the next 12 months. Our
plan of operation is therefore dependent upon our ability to raise capital. We
have less than three months of working capital or cash available presently. We
need to raise additional funds as soon as practicable. We presently have no
arrangements or understandings with any investors or potential investors with
respect to an investment in E-City. We have not decided at what price or under
what terms we will raise such additional funds. The factors that we will utilize
in making such a decision include, our success in developing new customers or
strategic partners for E-City, the market valuation of our competitors, the
availability of investments generally for development stage start-up companies
and the feedback that we receive from potential investors. We intend to target
potential customers and potential strategic partners as possible investors in
E-City, though we have not received any indications of interest so far. E-City
has identified acquaintances of the officers and directors who are interested in
providing debt or equity financing for E-City. E-City has not reached any terms
with such prospective investors in which such financing would be forthcoming.
E-City intends to pursue these sources of possible financing. In addition,
E-City intends to pursue financing via venture capital funds and private capital
groups. E-City has not yet identified any specific venture capital funds or
private capital groups. E-City intends to identify such funds by September 30,
2001. There can be no assurance that E-City will be successful in identifying
appropriate funds or that such funds, if identified, will be willing to make an
investment in E-City on financial terms acceptable to E-City. E-City also
intends to solicit proposals from investment banking firms to conduct financing
on behalf of the Company. E-City has not identified any specific investment
banking firm to date. E-City intends to identify an appropriate investment
banking firm by September 30, 2001. There can be no assurance that E-City will
be successful in identifying an appropriate investment banking firm or that once
identified such an investment banking firm will be willing and able to provide
financing to E-City under acceptable terms and conditions. If we are unable to
raise additional or sufficient funds for E-City, we will have to abandon our
additional hiring plans, possibly close either our Seattle or Vancouver office
to consolidate, abandon our plan to produce paper maps, reduce staff or
salaries, increase the number of customers, or some combination thereof. These
steps may not be sufficient and we may fail, even with these measures, if we are
unsuccessful in raising additional funds under acceptable terms.

<PAGE>
                                       16

Research and development

    We intend to develop an ability over the next twelve months to deliver our
maps via hand held, internet enabled devices, such as a cellular phone or a Palm
Pilot or other personal electronic device. We do not yet know how much it will
cost to develop such an ability. We also intend to continue to develop
techniques for compressing our computer maps, shrinking their file size, so that
we might transmit them faster over the world wide web. We do not yet know how
much it will cost to do this. The factors we will use to determine how much
money to spend on research and development will include, feedback from our
customers, the expenditures of our competitors, the availability and terms of
additional financing that we intend to seek, our available cash and general
market conditions.

Plant and equipment

    We currently have offices in Seattle, Washington and Vancouver, British
Columbia. Most of our core software development and mapping and animation
technology will be hosted in Vancouver where the employee base is large and
wages are generally lower than in most regions of the United States for software
developers. We would like to expand our Seattle and Vancouver offices if we are
able to hire additional employees and our customer growth supports such an
expansion. According to the growth plan that we have currently, we will need
approximately 5000 additional square feet of office space between the two
facilities. We believe that this space will be available to lease on an already
improved basis and should cost us approximately $60,000 per year in office lease
payments.

Employees

    We plan to hire approximately 15 additional developers in the next 12 months
to meet business expansion and continue servicing existing and new clients,
developing existing and new business lines, and augmenting our management,
marketing, sales and business development capacities. We intend to hire an
additional 8 to 10 sales and marketing staff members. This should bring our
total of new hires to around 25 over the course of the next 12 months. We
estimate the average cost of each new hire to be approximately $45,000 per year.
If we are unable to afford to hire so many people, we will scale back our
expansion plans accordingly.

<PAGE>
                                       17


                            PART II OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS

     None.

ITEM 2.   CHANGES IN SECURITIES


     None.

ITEM 3.   DEFAULTS UPON SENIOR SECURITIES

     None.

ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     None.

ITEM 5.   OTHER INFORMATION

     None.

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

     (a)  List of Exhibits

     None.

     (b)  Reports on Form 8-K.

     We did not file any reports on Form 8-K during the quarter ended June 30,
2001.

 <PAGE>
                                       18


                                    SIGNATURE

     Pursuant to the requirements 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.

                                         E-City Software, Inc.

                                         /s/ Anis Jessa
                                         -----------------------------
                                         Anis Jessa
                                         Chief Executive Officer
                                         (Duly Authorized Officer and Principal
                                         Financial and Accounting Officer)

Dated:  August 13, 2001