SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB


(Mark One)

   [X]      Quarterly  report  under  Section  13 or  15(d)  of  the  Securities
            Exchange Act of 1934 for the quarterly period ended June 30, 2004

   [ ]      Transition report under Section 13 or 15(d) of the Exchange Act
            for the transition period from __________ to __________.


                        Commission File Number: 000-31451
                                    ---------

                                 CYBERADS, INC.
                                 --------------
        (Exact name of small business issuer as specified in its charter)



            Florida                                      65-1000634
-------------------------------             ------------------------------------
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
incorporation or organization)



            21073 Powerline Road, Suit 57, Boca Raton, Florida 33433
            --------------------------------------------------------
               (Address of principal executive office) (Zip Code)

                                 (561) 672 2193
                                ----------------
                           (Issuer's telephone number)




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

                          Yes    XX                  No
                              --------                  --------

As of June 30, 2004 , the number of outstanding  shares of the issuer's  common
stock, $.001 par value, was 18,925,777 shares.


          TRANSITIONAL SMALL BUSINESS DISCLOSURE FORMAT: Yes [ ] No [X]




                                        1
<PAGE>
                                TABLE OF CONTENTS



ITEM 1.  FINANCIAL STATEMENTS ............................................... 3

         Consolidated Unaudited Balance Sheet as of June 30, 2004............ 3

         Consolidated Unaudited Statements of Operations for the
                  Quarters ended June 30, 2004 and June 30, 2003............. 4

         Consolidated Unaudited Statements of Cash Flows for the
                  Quarter ended June 30, 2004................................ 5

         Notes to Consolidated Financial Statements.......................... 6


ITEM 2.  MANAGEMENT'S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS .............................................. 12


ITEM 3.  CONTROLS AND PROCEDURES............................................. 14


                           PART II - OTHER INFORMATION

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8K..................................... 15


SIGNATURES................................................................... 15






























                                        2
<PAGE>
                         PART I - FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS.
<TABLE>
<CAPTION>
                                 CYBERADS, INC.

                           Consolidated Balance Sheets

                                                                              June 30,           December 31,
                                                                                2004                 2003
                                                                         -----------------    -----------------
<S>                                                                      <C>                  <C>
                                     Assets
Current asset -
   Accounts receivable                                                    $             -      $        20,380

Property and equipment, net                                                        14,171               14,171

Other assets:
   Hold-to-maturity investments                                                10,700,000           10,700,000
   Deposits                                                                         8,585                8,585
                                                                           --------------       --------------
     Total other assets                                                        10,708,585           10,708,585
                                                                           --------------       --------------

                                                                          $    10,722,756      $    10,743,136
                                                                           ==============       ==============
                      Liabilities and Stockholders' Equity

Current liabilities:
   Outstanding checks in excess of cash in bank                           $        14,774      $         1,207
   Note payable                                                                   109,000              120,000
   Accounts payable                                                               814,448              697,748
   Accounts payable to cellular phone service provider                            203,710              492,423
   Accrued payroll and payroll related liabilities                                614,143              548,195
   Other accrued liabilities                                                       38,993               35,000
   Payable to related parties                                                     786,555              786,555
   Loans payable - convertible debentures                                          60,000               60,000
                                                                           --------------       --------------
     Total current liabilities                                                  2,641,623            2,741,128

Payable to stockholder                                                            204,634              157,634


Stockholders' equity:
  Preferred stock; $.001 par value; authorized 5,000,000 shares,
   of which 1,000,000 shares has been designated as Series A
   Convertible, shares issued and outstanding 835,660                                836                  836
  Common stock; $.001 par value; shares authorized 50,000,000;
   shares issued and outstanding 18,925,777 in 2004
   (18,325,777 in 2003)                                                           18,926               18,326
  Common stock to be issued                                                   11,140,050           11,140,000
  Additional paid in capital                                                  15,653,088           15,399,238
  Retained deficit                                                           (18,936,401)         (18,714,026)
                                                                           --------------       --------------
     Total stockholders' equity                                                 7,876,499            7,844,374
                                                                           --------------       --------------

                                                                          $    10,722,756      $    10,743,136
                                                                           ==============       ==============
</TABLE>
                            See accompanying notes.

                                       3
<PAGE>
<TABLE>
<CAPTION>
                                 CYBERADS, INC.

                      Consolidated Statements of Operations


                                             Three months ended June 30            Six months ended June 30
                                        -----------------------------------   ---------------------------------
                                               2004              2003               2004              2003
                                        ----------------   ----------------   ----------------  ---------------
<S>                                     <C>                <C>                <C>               <C>
Revenues                                   $         -      $   1,115,845       $    303,120     $   3,576,875

Cost of revenues                                     -             (9,611)                 -           986,616
                                            ----------       ------------        -----------      ------------

Gross profit                                         -          1,125,456            303,120         2,590,259

Operating expenses:
   Selling                                           -            448,449                  -         1,062,887
   General and administrative                  419,500            449,749            524,342         1,637,800
                                            ----------       ------------        -----------      ------------
     Total operating expenses                  419,500            898,198            524,342         2,700,687
                                            ----------       ------------        -----------      ------------

Net income (loss) from operations             (419,500)           227,258           (221,222)         (110,428)

Other income (expenses):
   Other income                                      -              1,965              4,847             2,972
   Interest expense and financing
    costs, net                                  (6,000)           (10,653)            (6,000)          (29,257)
                                            ----------       ------------        -----------      ------------
     Total other expenses                       (6,000)            (8,688)            (1,153)          (26,285)
                                            ----------       ------------        -----------      ------------

Net income (loss) before provision for
  income taxes                                (425,500)           218,570           (222,375)         (136,713)

Provision for income taxes                           -                  -                  -                 -
                                            ----------       ------------        -----------      ------------


Net Income (loss)                          $  (425,500)     $     218,570       $   (222,375)    $    (136,713)
                                            ==========       ============        ===========      ============



Net income (loss) per common share       $        (.023)    $        .013       $       (.012)   $       (.009)
                                          =============      ============        ============     ============
</TABLE>
                            See accompanying notes.

                                       4
<PAGE>
<TABLE>
<CAPTION>
                                 CYBERADS, INC.

                      Consolidated Statements of Cash Flows

                                             Three months ended June 30            Six months ended June 30
                                        -----------------------------------   ---------------------------------
                                               2004              2003               2004              2003
                                        ----------------   ----------------   ----------------  ---------------
<S>                                     <C>                <C>                <C>               <C>
Cash flows from operating activities:
   Net income (loss)                       $  (425,500)     $     218,570       $   (222,375)    $   (136,713)
   Adjustment to reconcile net
    income (loss) to net cash
    provided by (used in)
    operating activities:
     Provision (benefit) for
      doubtful accounts                              -                  -                  -          364,991
     Impairment of inventories                       -                  -                  -          120,879
     Impairment of long-lived assets                 -             46,332                  -           98,645
     Depreciation                                    -              9,496                  -           19,493
     Deferred financing costs                        -              2,015                  -            7,015
     Common stock issued for in
      exchange for compensation
      and services                             189,500                  -            189,500                -
     Changes in assets and liabilities:
       Receivables                                   -            (35,679)            20,380          569,707
       Inventories                                   -              6,828                  -           17,328
       Deposits and other assets                     -             13,472                  -           23,368
       Outstanding checks in
        excess of cash in bank                       -            (25,436)            13,567         (112,649)
       Accounts payable                        145,000            216,260           (172,013)        (717,747)
       Accrued liabilities                       6,000            (23,300)            69,941           (4,381)
                                            ----------        -----------        -----------      -----------
                                               (85,000)           428,558           (101,000)         249,936
 Cash flows from investing activities -
   Capital expenditures                              -                  -                  -          (13,967)
Cash flows from financing activities:
   Principal repayments of note payable              -                  -            (11,000)               -
   Advances received from stockholder           20,000                  -             47,000                -
   Principal repayments to related parties           -                  -                  -         (207,360)
   Proceeds from stock options exercised        65,000                  -             65,000                 -
   Net borrowings from factor                        -           (399,949)                 -                -
                                            ----------        -----------        -----------      -----------
                                                85,000           (399,949)           101,000         (207,360)
                                            ----------        -----------        -----------      -----------
Net change in cash                                                 28,609                  -           28,609
Cash at beginning of period                          -                  -                  -                -
                                            ----------        -----------        -----------      -----------

Cash at end of period                      $         -       $     28,609       $          -     $     28,609
                                            ==========        ===========        ===========      ===========
</TABLE>
                            See accompanying notes.

                                       5
<PAGE>
                                 CYBERADS, INC.

                   Notes to Consolidated Financial Statements
                                  June 30, 2004


1. Summary of significant accounting policies
         Business: CyberAds, Inc. ("CyberAds") was incorporated in the state of
         Florida on April 12, 2000. The Company earns commissions from selling
         approved contracts to subscribers for cellular telephone service.
         Commissions are received either from master dealers or cellular phone
         service providers, not the subscriber. Applications for cellular
         telephone services are obtained from advertising banners placed at
         various websites. The Company does business with cellular phone service
         providers as well as master dealers that have contracted with various
         other carriers and with several website hosts, who receive a commission
         for each completed contract for cellular phone service.

         Principles of consolidation: The accompanying consolidated financial
         statements include the accounts of CyberAds and it's wholly owned
         subsidiary IDS. All significant intercompany balances have been
         eliminated in consolidation. The operations of IDS are currently
         dormant.

         Interim reporting: The Company's year-end for accounting and tax
         purposes is December 31. In the opinion of Management, the accompanying
         consolidated financial statements as of June 30, 2004 and 2003 and for
         the three and six months then ended, consisting of only normal
         recurring adjustments, except as noted elsewhere in the notes to the
         consolidated financial statements, necessary to present fairly its
         financial position, results of its operations and cash flows. The
         results of operations for the three and six months ended June 30, 2004
         and 2003 are not necessarily indicative of the results to be expected
         for the full year.

         Property and equipment: Property and equipment are stated at cost less
         accumulated depreciation. Depreciation is provided for over the
         estimated useful life of the assets of five to seven years. Leasehold
         improvements are amortized over the lesser of the original term of the
         related lease or their estimated useful life.

         Investments: Investments are classified as trading securities,
         available-for-sale securities, or hold-to-maturity securities. Trading
         securities are reported at fair market value, with unrealized gains or
         losses recognized as a component of operating results;
         available-for-sale securities are reported at fair market value, with
         unrealized gains and losses excluded from earnings but reported in a
         separate component of shareholders' equity (net of the effects of
         income taxes) until they are disposed of or sold; at the time of
         disposal or sale, any gains or losses, calculated by the specific
         identification method, are recognized as a component of operating
         results; and hold-to-maturity securities are reported at amortized
         cost.

         The Company's hold-to-maturity investments as of December 31, 2003
         consisted of a 22% interest in a limited liability company that owns
         real estate.

                                       6
<PAGE>
                                 CYBERADS, INC.

                   Consolidated Notes to Financial Statements
                                 June 30, 2004


1. Summary of significant accounting policies (continued)

         Impairment of long-lived assets: The Company assess' the recoverability
         of long-lived assets under SFAS 144, "Accounting for the Impairment or
         Disposal of Long-Lived Assets" by determining whether the depreciation
         and amortization of the asset's balance over its remaining life can be
         recovered through projected undiscounted future cash flows. The amount
         of impairment, if any, is measured based on fair value and charged to
         operations in the period in which the impairment is determined by
         management. Long-lived assets to be disposed of are reported at the
         lower of carrying amount or fair value less cost to sell.

         The Company recorded an impairment loss during the three months ended
         June 30, 2003 of $46,332 and during the six months ended June 30, 2003
         of $98,645 for assets that became idle as a result of staff reductions.

         Revenue recognition: In 2004 and 2003, the Company recorded revenue on
         a "net" basis when contracts are submitted to master dealers. The
         phones are shipped from the dealers to the subscriber and the Company
         does not bear the risk of loss on the cellular phone. Revenue is
         recognized when the master dealer ships the phones to the subscriber.

         In 2003, the Company also recorded revenue on a "gross" basis when
         contracts were submitted directly to cellular phone service providers.
         The phones were shipped from the Company to the subscriber and the
         Company bore the risk of loss on the cellular phone. Under the gross
         method commission and related cost of goods sold for the cellular phone
         was recognized when the Company shipped the phones.

         Stock options and warrants: The Company uses a fair value based method
         of accounting for stock based compensation to employees. The Company
         also accounts for stock options and warrants issued to non-employees
         for services under the fair value method of accounting.

         Net income (loss) per common share: Net income (loss) per common share
         is computed by dividing net income (loss) by the weighted average
         number of common shares outstanding during the period. The weighted
         average number of common stock shares outstanding was 18,799,403 for
         the three months ended June 30, 2004 (16,532,469 for the three months
         ended June 30, 2003) and 18,562,590 for the six months ended June 30,
         2004 (15,822,843 for the six months ended June 30, 2003).

          Use of estimates: The process of preparing financial statements in
         conformity with accounting principles generally accepted in the United
         States of America requires the use of estimates and assumptions
         regarding certain types of assets, liabilities, revenues and expenses.
         Accordingly, upon settlement, actual results may differ from estimated
         amounts.

                                       7
<PAGE>
                                 CYBERADS, INC.

                   Consolidated Notes to Financial Statements
                                 June 30, 2004


2.       Operations
         ----------
         Management of the Company plans to continue to restructure debt, seek
         profitable products, reduce operating expenses, and seek additional
         capital and debt financing until operations achieve profitability.
         Management of the Company believes the above actions, along with other
         plans, will allow them to continue operations and ultimately achieve
         profitability. Until then, the Company is dependent upon its ability to
         obtain additional capital and debt financing. The consolidated
         financial statements as of June 30, 2004 do not reflect adjustments
         relating to the recorded asset amounts, or the amounts of liabilities
         that would be necessary should the Company not be able to continue in
         existence.

 3.      Cash flows
         ----------
         Supplemental disclosure of cash flow information is as follows:
<TABLE>
<CAPTION>
                                                  Three months ended          Six months ended
                                                        June 30                    June 30
                                                ----------------------   ----------------------
                                                   2004        2003         2004      2003
                                                ---------   ----------   ----------  ----------
<S>                                             <C>         <C>          <C>         <C>
           Cash paid during the period for -
              Interest                          $      -    $       -    $       -   $  13,604
                                                 =======     ========     ========    ========
</TABLE>
4.       Note payable
         ------------
         The note payable was due in installments of $5,000 on January 15, 2004
         and February 15, 2004, plus interest at the rate of 10% per annum.
         Final payment was due March 15, 2004. The note is secured by all of the
         Company's accounts receivable, inventories, and computer hardware and
         software and is guaranteed by two former officers of the Company. The
         Company is currently in default with respect to the agreement.

5.       Payable to related parties
         --------------------------
         Advances from related parties consisted of the following at:
<TABLE>
<CAPTION>
                                                                       June 30,       December 31,
                                                                         2004             2002
                                                                      ------------  ----------------
<S>                                                                   <C>           <C>
              Advance due to a corporation owned by a former
               officer of the Company, bearing interest at 10% per
               annum, due on demand and unsecured                     $   54,000       $    54,000

              Advance due to a former officer of the Company,
               bearing interest at 10% per annum, due on demand
               and unsecured                                             732,555          732,555
                                                                       ----------       ----------

                                                                      $  786,555      $   786,555
                                                                       ==========       ==========
</TABLE>

                                      -8-
<PAGE>
                                 CYBERADS, INC.

                   Consolidated Notes to Financial Statements
                                 June 30, 2004


6. Loans payable - convertible debentures
         Loans payable - convertible debentures consists of unsecured loans from
         two individuals whereby the principal of the note is convertible into
         the Company's common stock at the option of the holder. Interest on
         borrowings is payable quarterly at a rate of 20% per annum. The notes
         were due in installments of $15,000 on November 13, 2003, $13,750 on
         December 13, 2003 and January 13, 2004, with final payment due February
         13, 2004. The Company is currently in default with respect to the
         agreements. The notes are convertible into the Company's common stock
         at a conversion rate of 75% of the closing bid price of the Company's
         common stock one trading day prior to conversion.

7.       Payable to stockholder
         The payable to stockholder consists of advances from Novanet Media,
         Inc. for working capital purposes. The advances are unsecured,
         non-interest bearing and due on demand; however, Novanet Media, Inc.
         has agreed not to demand repayment of the advances before August 2005
         and unless cash is available from operations or a merger, capital stock
         exchange, asset acquisition, or other business combination.

8.       Contingencies
         The Company is non-compliant with respect to certain federal and state
         payroll related taxes. Included in accrued payroll and payroll related
         liabilities at June 30, 2004 and December 31, 2003 is approximately
         $540,800 of unpaid payroll taxes.

9.       Stock options
         The Company's stock option activity for options granted to employees
         and non-employees is summarized as follows for the six months ended
         June 30, 2004:
<TABLE>
<CAPTION>
                                                                 Fixed Plan
                                           --------------------------------------------------------
                                                           Weighted                       Weighted
                                                            average                        average
                                                           exercise        Shares         exercise
                                              Shares         price       exercisable        price
                                           ------------   -----------  ---------------  -----------
<S>                             <C>          <C>            <C>        <C>             <C>
         Outstanding at January 1, 2004      2,925,000      $  .48
                                                             =====
            Exercised                          500,000         .13
                                                             =====
            Cancelled                          225,000         .25
                                                             =====
            Expired                           (300,000)      1.04
                                           -----------       ====

         Outstanding at June 30, 2004        1,900,000      $  .51          1,900,000       $ .51
                                           ===========       =====       ============        ====
</TABLE>

         The Company's stock option outstanding and exercisable at June 30, 2004
is summarized as follows:





                                      -9-
<PAGE>
                                 CYBERADS, INC.

                   Consolidated Notes to Financial Statements
                                 June 30, 2004


9. Stock options (continued)
                                   Fixed Plan
         -----------------------------------------------------------------------
                      Options outstanding                 Options exercisable
         --------------------------------------------  -------------------------
                                   Weighted average
                                 --------------------               Weighted
             Range                remaining  exercise                average
           of prices   Shares       life      price     Shares    exercise price
         ------------ ---------  ----------- --------  ---------  --------------
         $.04 - $ .99 1,200,000  1 yr. 8 mo.  $   .27  1,200,000    $   .27
          ===========            ===========   ======                ======
         $.99 - $1.25   700,000  1 yr. 5 mo.  $  1.03    700,000    $  1.03
         ============ ---------  ===========     ====  ---------       ====
         $.04 - $1.25 1,900,000  1 yr. 6 mo.  $   .51  2,725,000    $   .51
         ============ =========  ===========   ======  =========     ======

10.      Settlements
         The Company entered into a consulting agreement in September 2002 for
         advisory, investor relations and public relations services. The
         consulting firm and the Company have taken the position that the other
         is in default of the agreement. The Company and the consulting firm
         reached a settlement in April 2004 whereby the Company agreed to issue
         100,000 shares of its common stock granted to the consulting firm under
         the original consulting agreement; however, the consulting firm is
         restricted from reselling the shares. Under the terms of the settlement
         agreement the consulting firm may resell no more than 3,000 share of
         the Company's common stock per week and no more than an aggregate of
         50,000 shares over a period of 120 days from the date of the
         settlement. They are further restricted from reselling the Company's
         common stock until September 13, 2004 at which time they may resell no
         more than 3,000 shares of the Company's common stock per week and no
         more than an aggregate of 50,000 shares over a period of 120 days. The
         Company recorded settlement expenses aggregating $110,000 as a result
         of the agreement. Management of the Company valued the shares issued at
         $1.10 per share, the closing bid price of the Company's common stock on
         the date of the agreement. Management of the Company estimated the
         value of the Company's shares granted after considering the historical
         trend of the trading prices for its common stock and the limited volume
         of shares being traded.

         On April 27, the Company issued 50,000 shares of its common stock in
         accordance with the terms of the agreement. The Company has reserved an
         additional 50,000 shares of its common stock for issuance under the
         agreement.

         In April 2004, the Company agreed to indemnify a former officer of the
         Company for any loss he sustained in a settlement reached with a
         cellular phone service provider against IDS and him personally. Under
         the indemnification, the Company is obligated to pay an aggregate of
         $72,261 in installments of $5,000 each on or before August 1, 2004 and
         September 1, 2004 with the balance due October 1, 2004. The
         indemnification had no effect on the accompanying financial statements
         as the amount owed to the cellular phone service provider was
         previously recorded as accounts payable in the records of IDS.




                                      -10-
<PAGE>
                                 CYBERADS, INC.

                   Consolidated Notes to Financial Statements
                                 June 30, 2004


11.      Subsequent events
         Effective August 1, 2004, the Company renegotiated $185,192 of accounts
         payable to a cellular phone service provider to an unsecured promissory
         note requiring the Company to repay the amount in two installments of
         $92,596 each, plus interest at 1.5% per month on the outstanding
         balance, due on December 1, 2004 and July 1, 2005.














































                                      -11-
<PAGE>
ITEM 2  -  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
           RESULTS OF OPERATIONS

Management's discussion and analysis contains various forward-looking statements
within the meaning of the Securities and Exchange Act of 1934. These statements
consist of any statement other than a recitation of historical fact and can be
identified by the use of forward looking terminology such as "may", "expect",
"anticipate", "estimates", or "continue" or use of negative or other variations
of comparable terminology. We caution that these statements are further
qualified by important factors that could cause actual results to differ
materially from those contained in our forward looking statements, that these
forward looking statements are necessarily speculative, and there are certain
risks and uncertainties that could cause actual events or results to differ
materially from those referred to in our forward looking statements.

Management's discussion and analysis should be read in conjunction with the
financial statements and the notes thereto.

RESULTS OF OPERATIONS
Six months ended June 30, 2004 compared to the six months ended June 30, 2003
and three months ended June 30, 2004 compared to the three months ended June 30,
2003:

         In March 2003, the Company changed their business model whereby
cellular phone service providers, or a fulfillment company, began shipping
cellular telephones directly to the Company's subscribers, rather than the
Company carrying cellular telephone inventories and shipping to the Company's
subscribers.

         Also, effective September 9, 2003, all then-existing officers of the
Company resigned and were replaced with new management.

         Revenues were $303,120 for the six months ended June 30, 2004 compared
to $3,576,875 for the six months ended June 30, 2003. The $3,273,755 decrease
reflects the impact of the change in the Company's business model. Under the new
model, the Company records revenue on a "net" basis when the master dealers ship
the phones to the subscriber. Under the previous business model, the Company
recorded revenue on a "gross" basis when the Company shipped the phones. The
decrease in revenues also reflects the impact of the elimination of unprofitable
products by new management.

         The Company had no revenues for the three months ended June 30, 2004
compared to $1,115, 845 for the three months ended June 30, 2003. Management of
the Company has devoted all of there efforts during the three months ended June
30, 2004 toward restructuring debt and settling claims.

          There were no costs of revenues for the six months ended June 30, 2004
compared to $986,616 for the six months ended June 30, 2003. Under the new
business model the Company no longer carries cellular telephone inventories.

         There were also no selling expenses for the six months ended June 30,
2004 compared to $1,062,887 for the six months ended June 30, 2003. The decrease
reflects the impact of the change in the Company's business model whereby the
service provider is now responsible for handling all order fulfillment
processes, customer service, verification and shipping.

         General and administrative expenses were $524,342 for the six months
ended June 30, 2004 compared to $1,637,800 for the six months ended June 30,
2003. The decrease reflects the impact of the change in the Company's business
model and the impact of new management reducing overhead.

                                      -12-
<PAGE>
         General and administrative expenses were $419,500 for the three months
ended June 30, 2004 compared to $449,749 for the three months ended June 30,
2003. Losses from settlements of claims against the Company aggregated $254,500
during the three months ended June 30, 2004 that the Company believes will not
reoccur along with legal costs of $37,000 relating to those settlements.

FINANCIAL POSITION & LIQUIDITY AND CAPITAL RESOURCES

As of June 30, 2004 compared to December 31, 2003:

         The Company had a working capital deficit of $2,641,623 as of June 30,
2004 compared to a working capital deficit of $2,720,748 as of December 31,
2003. The decrease in the Company's working capital deficit of $79,125 was a
result of the Company raising $65,000 from the exercise of stock options and
$47,000 of advances from a stockholder.

         Since September 2003 when new management began operating the Company
approximately $1,668,400 of accounts payable and accrued liabilities have been
renegotiated into term debt or converted to capital stock of the Company. New
management expects to continue to improve its working capital by restructuring
debt, seeking profitable products, reducing overhead, and seeking additional
capital until debt can be satisfied and assets recovered through continued
profitable operations.

         A major stockholder advanced an additional $20,000 to the Company for
working capital purposes during the three months ended June 30, 2004 and as of
that date has advanced the Company an aggregate of $204,634. This stockholder
has agreed not to demand repayment of the advances before August 2005 and unless
cash is available from operations or from a merger, capital stock exchange,
asset acquisition, or other business combination. There can be no assurances
that this stockholder will continue to provide advances to the Company.



























                                       13
<PAGE>
ITEM 3.  CONTROLS AND PROCEDURES

As of June 30, 2004 the Company carried out an evaluation, under the
supervision and with the participation of the Company's management, including
the Company's Chief Executive Officer and President, of the effectiveness of the
design and operation of the Company's disclosure controls and procedures
pursuant to Rule 13a-14 of the  Securities Exchange Act of 1934.  Based upon
that eva1uation, these principal executive officers and principal financial
officer concluded that the Company's disclosure controls and procedures are
effective in timely alerting them to material information relating to the
Company, including its consolidated subsidiaries, required to be included in the
Company's periodic SEC filings. There have been no significant changes in
internal controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation.












































                                       14
<PAGE>
                           PART II - OTHER INFORMATION

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8K

(a)              Exhibits.
                 --------

Exhibit
Number           Description of Document

3.1(a) Articles of Incorporation (Incorporated by reference)

3.1(b) Amendment to Articles of Incorporation (Incorporated by reference)

3.2    ByLaws (Incorporated by reference)

4.0    Description of Series A Convertible Preferred Stock (Incorporated by
       reference)

31     Rule 13a-14(a)/15d-14(a) Certification

32     Section 1350 Certification

(b)              Reports on Form 8-K.
                 -------------------
                 No reports on Form 8-K were filed during the period covered by
                 this report.


                                   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.

Date: August 16, 2004               CYBERADS, INC.

                                 By: /s/ WALTER TATUM
                                 --------------------------
                                 Walter Tatum, President




















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