U.S. Securities and Exchange Commission

                             Washington, D.C. 20549

                                   Form 10-QSB

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

For the quarterly period ended June 30, 2002

[_]  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:0-25429

                      Diversified Product Inspections, Inc.
                     ---------------------------------------
                     (Exact name of small business issuer as
                            specified in its charter)

          Florida                                              65-0832025
- ---------------------------------                    -----------------------
(State of other jurisdiction of                             (IRS Employer
incorporation or organization)                             Identification No.)


                                  3 Main Street
                               Oak Ridge, TN 37830
                  --------------------------------------------
                    (Address of principal executive offices)


                                 (865) 482-8480
                           ---------------------------
                           (Issuer's telephone number)


                                   February 28th
              -----------------------------------------------------
              (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 ___

         As of August 14, 2002, there were 14,936,457 shares of common stock,
$0.01 par value, issued and outstanding.

<PAGE>





                          Index to Financial Statements





Condensed  Consolidated  Balance Sheets                                      F-2
Condensed  Consolidated  Statements  of  Operations                          F-3
Condensed  Consolidated  Statements  of  Cash  Flows                         F-4
Notes  to  Condensed  Consolidated  Financial  Statements                    F-5







                                       F-1

<PAGE>
                      Diversified Product Inspections, Inc.

                      Condensed Consolidated Balance Sheets


                                                      June 30        December 31
2001
----------------------------
                                                    (Unaudited)
Assets
Current  assets:
 Cash                                               $   25,833      $   46,016
 Accounts  receivable,  net                            192,623         104,841
 Refundable  income  taxes                               5,214           5,214
 Prepaid  expenses  and  other  current  assets          2,723           2,323
                                                    ----------------------------
Total  current  assets                                 226,393         158,394

Property  and  equipment:
 Equipment,  furniture  &  fixtures                    173,655         173,655
 Vehicles                                               97,737          97,737
 Leasehold  improvements                                22,727          22,727
                                                    ----------------------------
                                                       294,119         294,119
 Less  accumulated  depreciation  and  amortization   (154,079)       (119,359)
                                                    ----------------------------
Net  property  and  equipment                          140,040         174,760

Other  assets:
 Deferred  stock  issuance  costs                      140,143               -
 Other                                                   4,400           4,400
                                                    ----------------------------
Total  other  assets                                   144,543           4,400
                                                    ----------------------------
Total  assets                                       $  510,976      $  337,554
                                                    ============================

Liabilities  and  stockholders'  deficit
Current  liabilities:
 Lines  of  credit                                  $   83,520      $  123,929
 Accounts  payable  and  accrued  expenses             147,189         139,567
 Accrued  salaries                                      13,816          13,816
 Advance  from  stockholder                             16,000          18,000
 Current  portion  of  long-term  debt                  15,451          16,517
 Current  portion  of  capital  lease  obligations       7,175          14,545
                                                    ----------------------------
Total  current  liabilities                            283,151         326,374

Long-term  debt,  less  current  portion                32,002          38,758
Convertible  debt,  net  of  discount  of $3,332       196,668               -
                                                    --------------------------
Total  liabilities                                     511,821         365,132

Stockholders'  deficit:
 Common  stock,  par  value  $0.01, authorized
  50,000,000  shares,  issued  and  outstanding
  14,936,457  in  2002  and  14,255,709 in 2001        136,059         129,252
 Additional  paid-in  capital                        1,615,216       1,403,343
 Accumulated  deficit                               (1,752,120)     (1,560,173)
                                                    ----------------------------
Total  stockholders'  deficit                             (845)        (27,578)
                                                    ----------------------------
Total  liabilities  and  stockholders'  deficit     $  510,976     $   337,554
                                                    ============================

See  accompanying  Notes  to  Condensed  Consolidated  Financial  Statements.

                                       F-2

<PAGE>

                      Diversified Product Inspections, Inc.

           Condensed Consolidated Statements of Operations (Unaudited)


                                    Three Months Ended       Six Months Ended
                                          June 30                 June 30
                                    2002          2001        2002       2001
                                 ------------------------ --------------------

Revenues                         $ 522,200     $ 269,594   $ 890,262  $ 485,023

Operating  expenses:
 Salaries                          243,690       158,000     440,488    316,220
 Depreciation                       17,361        17,922      34,720     31,310
 General  and administrative       322,256       196,114     535,712    383,171
                                 ------------------------ ---------------------
Total  operating expenses          583,307       372,036   1,010,920    730,701
                                 ------------------------ ---------------------

Operating  loss                    (61,107)     (102,442)   (120,658)  (245,678)

Other  income  (expense):
 Other  income                           -         3,381           -      9,605
 Other  expense                          -             -           -     (2,554)
 Interest  expense                 (59,506)       (6,993)    (71,289)   (13,071)
                                 ------------------------ ---------------------
Net  other  income (expense)       (59,506)       (3,612)    (71,289)    (6,020)
                                 ------------------------ ---------------------

Net  loss                        $(120,613)    $(106,054)  $(191,947) $(251,698)
                                 ======================== =====================

Basic  net  loss  per share         $(0.01)       $(0.01)     $(0.01)    $(0.02)
                                 ======================== =====================

See  accompanying  Notes  to  Condensed  Consolidated  Financial  Statements.


                                       F-3

<PAGE>

                      Diversified Product Inspections, Inc.

            Condensed Consolidated Statements of Cash Flows (Unaudited)

<TABLE>
<CAPTION>
                                              SIX MONTHS ENDED JUNE 30
                                                   2002        2001
                                              ------------------------
<S>                                                <C>         <C>
OPERATING ACTIVITIES
Net loss                                        $(191,947)  $(251,698)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation and amortization                      34,720      31,310
Interest expense on convertible debt issued at
 a conversion rate below market value              50,205           -
Changes in operating assets and liabilities:
Accounts receivable                               (87,782)        (80)
Prepaid expenses and other assets                    (400)       (392)
Accounts payable and accrued expenses               7,622      40,772
Accrued salaries                                        -         981
Other current liabilities                               -      (4,634)
                                              ------------------------
Net cash used in operating activities            (187,582)   (183,741)

INVESTING ACTIVITIES
Purchases of property and equipment                     -     (57,489)

FINANCING ACTIVITIES
Payment on shareholder advance                     (2,000)          -
Net payments on line of credit                    (40,409)          -
Proceeds from convertible debt                    200,000           -
Principal payments of long-term debt
 and capital lease obligation                     (15,192)    (11,563)
Proceeds from sale of common stock                 25,000     150,000
                                              ------------------------
Net cash provided by financing activities         167,399     138,437

Net decrease in cash                              (20,183)   (102,793)

Cash at beginning of period                        46,016     154,573
                                              ------------------------
Cash at end of period                           $  25,833   $  51,780
                                              ========================
SUPPLEMENTAL  DISCLOSURE  OF  CASH
FLOW  INFORMATION

Cash paid for interest during the period        $  21,084   $  13,071
                                              ========================

See  accompanying  Notes  to  Condensed  Consolidated  Financial  Statements.

</TABLE>

                                      F-4
<PAGE>

                      Diversified Product Inspections, Inc.

NOTES  TO  CONDENSED  CONSOLIDATED  FINANCIAL  STATEMENTS  (UNAUDITED)

1.  BASIS  OF  PRESENTATION

The  accompanying  unaudited  condensed  consolidated  financial  statements  of
Diversified  Products  Inspections,  Inc.  (the "Company") have been prepared in
accordance with accounting principles generally accepted in the United States of
America  for  interim  financial  information  and  pursuant  to  the  rules and
regulations  of  the  Securities and Exchange Commission.   Accordingly, they do
not  include  all  of  the  information  and  footnotes  required  by accounting
principles  generally  accepted  in  the  United  States of America for complete
financial statements.  In the opinion of management, all adjustments (consisting
of  normal recurring accruals) considered necessary for a fair presentation have
been  included.  Operating  results  for  the three- and six-month periods ended
June 30, 2002 are not necessarily indicative of the results that may be expected
for  the  year  ended  December  31,  2002.

The  condensed  consolidated  financial  statements  include  the  accounts  of
Diversified  Product  Inspections,  Inc.  and  its  wholly  owned  subsidiary,
Diversified  Product Investigations, Inc. ("Investigations").  All inter-company
balances  and  transactions  have  been  eliminated.

The  balance  sheet  at  December  31,  2001  has  been derived from the audited
financial  statements  at  that date but does not include all of the information
and  formats  required by accounting principles generally accepted in the United
States  of  America  for  complete  financial  statements.

For  further  information,  refer  to  the consolidated financial statements and
footnotes thereto included in the Company's annual report on Form 10-KSB for the
year  ended  February  28,  2002.

2.     CHANGE  IN  FISCAL  YEAR-END

Effective  June  26,  2002,  Diversified  Product  Inspections, Inc., the parent
holding  company,  changed  its fiscal year-end from the last day in February to
December  31  to  correspond  with  the  fiscal  year-end of Investigations, its
subsidiary  operating  company.  Accordingly, these interim financial statements
reflect  the  change  in  fiscal  year-end.

3.     COMPANY  STOCK  TRANSACTIONS

During  January  2002,  the Company received $25,000 for 71,429 shares of common
stock.

The  Company has outstanding stock warrants to a stockholder which allow for the
purchase of 375,000 shares of the Company's stock at an exercise price of $1 per
share.

As  discussed  in Note 4, the Company issued 387,097 shares of common stock to a
company  as  a  commitment  fee  related  to an equity line of credit agreement.
Additionally,  the  Company issued 222,222 shares of common stock to an attorney
for  fees  associated  with this agreement.  As these represent costs associated
with  raising capital, the Company has recorded $140,143 as deferred stock issue
costs  and  an  increase  to equity pending future funding under this agreement.


                                       F-5
<PAGE>
                      Diversified Product Inspections, Inc.

NOTES  TO  CONDENSED  CONSOLIDATED  FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)



4.  CONVERTIBLE  DEBT  AND  EQUITY  LINE  OF  CREDIT  AGREEMENT

During  April  2002,  the  Company  entered into a subscription agreement with a
company  (the  "Investor")  in which the Company will receive up to $300,000 (in
$100,000  tranches)  from  the  Investor in return for a corresponding amount of
convertible debentures and related warrants.  Significant terms of the agreement
are  summarized  as  follows:

-     The  debentures may be converted at any time by the Investor at the lesser
of  (i) 110% of the average five closing bid prices during the five trading days
prior to the issuance date or (ii) 75% of the average of the five lowest closing
bid  prices  during  the twenty trading days immediately prior to the conversion
date.

-     In  the  event all or any portion of the debentures are outstanding at the
end  of  three  years  from  the date of issuance, the debentures are subject to
automatic conversion into Company stock based upon the conversion rate described
above.

-     The debentures shall pay 6% cumulative interest, payable in arrears at the
time  of  each  conversion,  in  cash  or  common  stock  of the Company, at the
Company's  option.

-     The  debentures  are  secured  by 4,000,000 shares of the Company's common
stock,  which  is  currently  owned  by  the  Company's  majority  stockholders.

-     Upon  funding  of  the  first  tranche, the Company issued to the Investor
warrants  to purchase the resulting number of shares of the Company's stock that
equals the total amount being funded in all three tranches, divided by the share
price  (five day average closing bid price prior to closing).  The warrants will
be  exercisable  for  four  years  from  the  corresponding closing date of that
tranche  being funded, at 110% of the five day average closing bid price for the
five  trading  days  prior  to the closing date of each funding tranche and will
carry  a  cashless  provision  only  at  the  option  of  the  Company.

During  April  2002,  the  Company received its first $100,000 tranche under the
terms  of  the  agreement.  As  a result of the conversion rates described above
which  allow for the conversion at a price less than the stock price at the date
of  the  funding,  and in accordance with provisions of the Financial Accounting
Standards  Board  Emerging  Issues  Task  Force  Issue  No.  98-5 ("EITF 98-5"),
Accounting  for  Convertible  Securities  with Beneficial Conversion Features or
Contingently  Adjustable  Conversion  Rates,  the  Company  recognized  interest
expense  and  increased  additional  paid-in capital by $27,250 related to these
debentures  at  the date of funding.  Additionally, in accordance with the terms
of the agreement described above, the Company issued warrants to the Investor to
purchase  an additional 462,963 shares of stock at an exercise price of $0.2376.
The  Company estimated the value of these warrant to be $1,666 and, accordingly,
the  $100,000 convertible debt was discounted and additional paid-in capital was
increased  by  this  amount.

During  June  2002,  the  Company received its second $100,000 tranche under the
terms  of  the  agreement.  As  a result of the conversion rates described above
which  allow for the conversion at a price less than the stock price at the date
of  the  funding,  and  in  accordance with provisions of EITF 98-5, the Company
recognized  interest expense and increased additional paid-in capital by $22,955
related to these debentures at the date of funding.  Additionally, in accordance
with  the terms of the agreement described above, the Company issued warrants to
the  Investor  to  purchase an additional 462,963 shares of stock at an exercise
price  of $0.23.   The Company estimated the value of these warrant to be $1,666
and,  accordingly,  the  $100,000 convertible debt was discounted and additional
paid-in  capital  was  increased  by  this  amount.

                                       F-6
<PAGE>
                      Diversified Product Inspections, Inc.

NOTES  TO  CONDENSED  CONSOLIDATED  FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)

4.  CONVERTIBLE  DEBT  AND  EQUITY  LINE  OF  CREDIT  AGREEMENT  (CONTINUED)

The  third  tranche  of  $100,000  shall  be  funded  to  the  Company  upon the
effectiveness  of  the  registration  statement covering all common stock of the
Company  to  be  registered  pursuant  to  the  terms of the secured convertible
debentures.

Also  during  April  2002,  the  Company  entered  into an equity line of credit
investment  agreement  with  the  Investor  which  provides  for the sale of the
Company's stock.  Subject to the Company's registration statement being declared
effective  and  remaining  effective along with the fulfillment of certain other
terms  and  conditions  contained in the agreement, the Investor is obligated to
purchase up to $3,000,000 of the Company's common stock at a price of 85% of the
average  of  the  four  lowest  closing bid prices of the Company's common stock
during  the  ten days subsequent to the date of the put notice.  These purchases
will  be made via put notices issued at the Company's discretion and each single
put  notice  shall  not  be less than $15,000 nor more than $150,000.  Under the
terms  of  the equity line of credit investment agreement the Company has agreed
to  issue  387,097  shares  of  the  Company's common stock to the Investor as a
commitment  fee.  Additionally,  under  the  terms  of the equity line of credit
investment  agreement,  the  Company  issued  warrants  enabling the Investor to
purchase 1,388,889 at an exercise price of $0.2376 per share, which is above the
trading value of the stock at the date the warrants were issued.  These warrants
expire  in  April 2006.  As of July 19, 2002, no such put notices have been made
by the Company and, accordingly, no stock has been issued under the terms of the
equity  line  of  credit.

5.     COMMITMENTS  AND  CONTINGENCIES

The  Company  currently  leases  its  office  and  warehouse  under an agreement
classified  as  an operating lease.  Under the terms of the lease agreement, the
Company  is  obligated  to  purchase  the  office  and  warehouse if the Company
receives $3,000,000 in proceeds from a private placement offering.  The purchase
price  will  range from between $1,500,750 and $1,607,640, depending on the year
the  purchase  takes  place.  This  purchase  obligation expires on December 31,
2004.

6.     LOSS  PER  SHARE  DATA

Basic  loss  per  share  assumes  no  dilution  and is computed by dividing loss
available  to common stockholders by the weighted average number of common stock
outstanding  during each period.  Diluted earnings per share reflect, in periods
in  which they have a dilutive effect, the effect of common shares issuable upon
the  exercise  of  stock  warrants, using the treasury stock method of computing
such  effects  and  contingent  shares, or conversion of convertible debt.  As a
result of the Company's losses, the effect of the outstanding stock warrants and
convertible  debt  has  an  antidilutive effect and there is no diluted loss per
share.

                                       F-7

<PAGE>
                      Diversified Product Inspections, Inc.

NOTES  TO  CONDENSED  CONSOLIDATED  FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)



6.     LOSS  PER  SHARE  DATA  (CONTINUED)

The  following  table sets forth the computation of basic loss per share for the
periods  indicated:
<TABLE>
<CAPTION>
<S> <C>

                                 THREE MONTHS ENDED              SIX MONTHS ENDED
                                       JUNE 30                       JUNE 30
                                  2002           2001         2002              2001
                               --------------------------   --------------------------

Net  loss                       $  (120,613)  $ (106,054)     $  (191,947)  $ (251,698)

Average  shares  outstanding     14,784,127   13,612,852       14,578,071   13,612,852
                               --------------------------   --------------------------
Basic  loss  per  share         $     (0.01)  $    (0.01)     $     (0.01)  $    (0.02)
                               ==========================   ==========================
</TABLE>
7.     GOING  CONCERN

The  accompanying  financial  statements  have  been prepared on a going concern
basis,  which  contemplates  the  realization  of assets and the satisfaction of
liabilities  in the normal course of business.  The Company's continuing losses,
among  other  things,  may  indicate the Company will be unable to continue as a
going  concern  for  a  reasonable  period  of  time.  Management recognizes the
Company  must  return  to profitable operations and generate additional funds in
order  to  continue as a going concern.  The Company has previously successfully
raised  capital  to  fund  its  operations  and  the Company anticipates raising
additional  capital  as  discussed  in  Note  4.


                                       F-8

<PAGE>


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

Introduction

     This Quarterly Report on Form 10-QSB should be read in conjunction with our
unaudited financial statements included as part of this Form 10-QSB Report. This
report  contains  forward-looking  statements  which are  described  and defined
below.

General

We  specialize  in  conducting  investigations and laboratory analysis of a wide
variety  of  products to determine the cause and origin of product failures. Our
primary customers consist of national insurance companies that are interested in
subrogating  claims  to  recover losses. Subrogation is a legal principle, which
provides  that,  to  the  extent  an  insurer  has  paid for a loss, the insurer
receives  the  policyholder's  right to recover from any third party that caused
the  loss. We have accumulated a large database of known defective products that
includes  photos  and other documentation that are used in their investigations.
Additionally,  we  provide  for the storage of evidence and derive revenues from
the  secure  storage  of  materials.

On  June  26, 2002, we changed our fiscal year end from the last day in February
to  December 31. We changed our fiscal year to conform to the fiscal year of our
subsidiary,  Diversified  Product  Investigations,  Inc.


Results of Operations  for the Six Month Period Ended June 30, 2002

Overview

The Company had net losses of $120,613 for the three months
ended  June  30,  2002 and had net losses of $191,947 for the sixth month period
ended  June 30, 2002 as compared to $251,698 for the six month period ended June
30,  2001. Since acquiring the shares of Investigations, the company has focused
on  conducting  investigations  and  laboratory  analysis  of  a wide variety of
products  to  determine  the  "cause  and  origin"  of  product  failures.
<PAGE>
Financial Position

As  of  June  30, 2002, the Company had cash available of $25,833, a decrease of
$20,183 from December 31, 2001. This decrease is primarily due to increased cash
used  in  operations.  The  Company's  cash  available is principally due to the
injection  of  private  placement  funds  from  the  sale  of  our common stock
and proceeds of convertible debt.

Revenues

For  the  three  months  ended  June  30,  2002  and 2001, the Company had total
revenues  of  $522,200  and $269,594 respectively. For the six months ended June
30,  2002  and  2001,  the  Company  had total revenues of $890,262 and $485,023
respectively.  Substantially  all  revenues were derived from investigations and
laboratory  analysis work related to determining the cause and origin of product
failures.  Management  attributes  this  increase  in  revenues to our marketing
efforts.

As of June 30, 2002 the Company's total liabilities and stockholders' deficit
was $510,976.

Selling, General, and Administrative Expenses

For  the three month period ended June 30, 2002, operating expenses increased by
$211,271  from  $372,036  for  the  three month period ended June 30, 2001. This
increase  is  primarily related to increased general and administrative expenses
which occurred as a result of the Company's increased revenues and  an  increase
of  $85,690  in  salaries.

For the six months ended June 30, 2002, operating expenses increased by $280,219
from $730,701 for the six months ended June 30, 2001. This
increase  is  primarily related to increased general and administrative expenses
which occurred as a result of the Company's increased revenues and  an  increase
of  $124,268 in  salaries.


Liquidity and Capital Resources

The  financial  condition, liquidity and capital resources of the Company should
be  assessed  in  context with the ability of the Company to continue as a going
concern  as  discussed  in  the independent auditors' report for the fiscal year
ended  February  28,  2001.

The  Company's  operations  have  been funded primarily from the issuance of its
Common  Stock  for  cash and proceeds from convertible debt.  This  allowed the
Company to continue its operations.

The  Company  anticipates  that  revenues will continue to be generated from the
investigative and analysis services it provides and that such revenues will help
to  fund the current level of operations. Provided that revenues continue and/or
additional funding is secured, the Company believes that it can meet its capital
needs  through  the  balance  of  the  current  calendar  year.  There can be no
assurance  that  the  Company  will  be  successful  in  these  efforts.

<PAGE>
During  April  2002,  the  Company  entered into a subscription agreement with a
company  (the  "Investor")  in which the Company will receive up to $300,000 (in
$100,000  tranches)  from  the  Investor in return for a corresponding amount of
convertible debentures and related warrants.  Significant terms of the agreement
are  summarized  as  follows:

-     The  debentures may be converted at any time by the Investor at the lesser
of  (i) 110% of the average five closing bid prices during the five trading days
prior to the issuance date or (ii) 75% of the average of the five lowest closing
bid  prices  during  the twenty trading days immediately prior to the conversion
date.

-     In  the  event all or any portion of the debentures are outstanding at the
end  of  three  years  from  the date of issuance, the debentures are subject to
automatic conversion into Company stock based upon the conversion rate described
above.

-     The debentures shall pay 6% cumulative interest, payable in arrears at the
time  of  each  conversion,  in  cash  or  common  stock  of the Company, at the
Company's  option.

-     The  debentures  are  secured  by 4,000,000 shares of the Company's common
stock,  which  is  currently  owned  by  the  Company's  majority  stockholders.

-     Upon  funding  of  the  first  tranche, the Company issued to the Investor
warrants  to purchase the resulting number of shares of the Company's stock that
equals the total amount being funded in all three tranches, divided by the share
price  (five day average closing bid price prior to closing).  The warrants will
be  exercisable  for  four  years  from  the  corresponding closing date of that
tranche  being funded, at 110% of the five day average closing bid price for the
five  trading  days  prior  to the closing date of each funding tranche and will
carry  a  cashless  provision  only  at  the  option  of  the  Company.

During  April  2002,  the  Company received its first $100,000 tranche under the
terms  of  the  agreement.  As  a result of the conversion rates described above
which  allow for the conversion at a price less than the stock price at the date
of  the  funding,  and in accordance with provisions of the Financial Accounting
Standards  Board  Emerging  Issues  Task  Force  Issue  No.  98-5 ("EITF 98-5"),
Accounting  for  Convertible  Securities  with Beneficial Conversion Features or
Contingently  Adjustable  Conversion  Rates,  the  Company  recognized  interest
expense  and  increased  additional  paid-in capital by $27,250 related to these
debentures  at  the date of funding.  Additionally, in accordance with the terms
of the agreement described above, the Company issued warrants to the Investor to
purchase  an additional 462,963 shares of stock at an exercise price of $0.2376.
The  Company estimated the value of these warrant to be $1,666 and, accordingly,
the  $100,000 convertible debt was discounted and additional paid-in capital was
increased  by  this  amount.

During  June  2002,  the  Company received its second $100,000 tranche under the
terms  of  the  agreement.  As  a result of the conversion rates described above
which  allow for the conversion at a price less than the stock price at the date
of  the  funding,  and  in  accordance with provisions of EITF 98-5, the Company
recognized  interest expense and increased additional paid-in capital by $22,955
related to these debentures at the date of funding.  Additionally, in accordance
with  the terms of the agreement described above, the Company issued warrants to
the  Investor  to  purchase an additional 462,963 shares of stock at an exercise
price  of $0.23.   The Company estimated the value of these warrant to be $1,666
and,  accordingly,  the  $100,000 convertible debt was discounted and additional
paid-in  capital  was  increased  by  this  amount.

The  third  tranche  of  $100,000  shall  be  funded  to  the  Company  upon the
effectiveness  of  the  registration  statement covering all common stock of the
Company  to  be  registered  pursuant  to  the  terms of the secured convertible
debentures.

Also  during  April  2002,  the  Company  entered  into an equity line of credit
investment  agreement  with  the  Investor  which  provides  for the sale of the
Company's stock.  Subject to the Company's registration statement being declared
effective  and  remaining  effective along with the fulfillment of certain other
terms  and  conditions  contained in the agreement, the Investor is obligated to
purchase up to $3,000,000 of the Company's common stock at a price of 85% of the
average  of  the  four  lowest  closing bid prices of the Company's common stock
during  the  ten days subsequent to the date of the put notice.  These purchases
will  be made via put notices issued at the Company's discretion and each single
put  notice  shall  not  be less than $15,000 nor more than $150,000.  Under the
terms  of  the equity line of credit investment agreement the Company has agreed
to  issue  387,097  shares  of  the  Company's common stock to the Investor as a
commitment  fee.  Additionally,  under  the  terms  of the equity line of credit
investment  agreement,  the  Company  issued  warrants  enabling the Investor to
purchase 1,388,889 at an exercise price of $0.2376 per share, which is above the
trading value of the stock at the date the warrants were issued.  These warrants
expire  in  April 2006.  As of July 19, 2002, no such put notices have been made
by the Company and, accordingly, no stock has been issued under the terms of the
equity  line  of  credit.

We believe that the net proceeds of our private placements will meet our working
capital  obligations  and  fund further development of our business for the next
twelve months. However, in order to execute our business plans to expand product
offerings  and  revenue  generating  opportunities,  we  will  likely  require
additional  working  capital.  There  can  be  no  assurance that any additional
financing  will  be  available  to  us  on  acceptable  terms,  or  at  all.
<PAGE>
Management  believes  that  the above-described actions will provide the Company
with  its  immediate  financial requirements to enable it to continue as a going
concern. In the event that we are unable to raise additional funds, we could  be
required  to  either  substantially  reduce or terminate our operations.

We are not aware of any material trend, event or capital commitment, which would
potentially  adversely affect our liquidity. In the event such a trend develops,
we  believe  that  we  will  have  sufficient funds available to satisfy working
capital  needs through lines of credit and the funds expected from equity sales.

Forward-Looking Statements

     This Form 10-QSB includes  "forward-looking  statements" within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities  Exchange  Act of  1934,  as  amended.  All  statements,  other  than
statements of historical  facts,  included or  incorporated by reference in this
Form 10-QSB which address  activities,  events or developments which the Company
expects or anticipates will or may occur in the future, including such things as
future capital expenditures  (including the amount and nature thereof),  finding
suitable merger or acquisition candidates, expansion and growth of the Company's
business  and operations, and other such matters are forward-looking statements.
These  statements  are  based  on  certain  assumptions and analyses made by the
Company  in  light  of  its  experience and its perception of historical trends,
current  conditions and expected future developments as well as other factors it
believes  are  appropriate in the circumstances. However, whether actual results
or  developments will conform with the Company's expectations and predictions is
subject  to  a  number  of  risks and uncertainties, general economic market and
business  conditions;  the  business opportunities (or lack thereof) that may be
presented  to  and  pursued  by  the Company; changes in laws or regulation; and
other  factors,  most  of  which  are  beyond  the  control  of  the  Company.
Consequently, all of the forward-looking statements made in this Form 10-QSB are
qualified  by these cautionary statements and there can be no assurance that the
actual  results  or developments anticipated by the Company will be realized or,
even  if substantially realized, that they will have the expected consequence to
or  effects on the Company or its business or operations. The Company assumes no
obligations  to  update  any  such  forward-looking  statements.

<PAGE>
                                     PART II

Item 1. Legal Proceedings.

     The  Company  knows  of no legal  proceedings  to which it is a party or to
which any of its  property  is the  subject  which are  pending,  threatened  or
contemplated or any unsatisfied judgments against the Company.

Item 2. Changes in Securities

     During  the  three month period ended June 30, 2002, the Company issued (i)
387,097 shares of common stock to a company, Sofcon Limited, as a commitment fee
related to the Company's equity line of credit agreement for financing; and (ii)
the  Company  issued 222,222 shares of its common stock to an attorney for legal
fees associated with the equity line agreement. The Company believes that all of
such shares issued were pursuant to an exemption from registration under Section
4(2)  of  the  Securities  Act  of  1933,  as  amended.

     In April 2002, we entered into a subscription agreement with an investor to
sell  up  to  $300,000  of our 6% convertible debentures. Under the terms of the
agreement,  the  investor  is  obligated  to  purchase  three  separate $100,000
principal  amount  debentures,  subject to the our satisfying certain conditions
described  in  the  agreement.  As  of the date of this Quarterly Report we have
received  $200,000  from  the  sale  of  our  6%  convertible  debentures.

     In connection with the sale of the debentures, we issued warrants to Sofcon
Limited  to  purchase  925,926  shares of our common stock exercisable at Prices
ranging  from  $.23  per  share  to  $.2376  per  share.  The  warrants  will be
exercisable  for  four  years  from  the  date  the  debenture  is  funded.

     Also,  during  April  2002,  we  entered  into  an  equity  line  of credit
investment  agreement with the investor which obligates the investor to purchase
up  to  $3,000,000  of our common stock at a price of 85% of the average trading
price,  subject  to certain terms and conditions contained in the equity line of
credit investment agreement. In connection with our equity credit line we issued
a  four  year  warrant  to  purchase  1,388,889 shares of our common stock at an
exercise  price of $.2376 per share. As of the date of this Quarterly Report, no
such put notices have been made by us and, accordingly, no stock has been issued
under  the terms of this agreement. The Company believes that all of such shares
issued were pursuant to an exemption from registration under Section 4(2) of the
Securities  Act  of  1933,  as  amended.

Item 3. Defaults in Senior Securities

         None
<PAGE>
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)  Exhibits

     99   Preferability Letter from Coulter & Justus, P.C.

(b)  The Company filed a Report on Form 8-K on June 26, 2002 disclosing that it
     changed its fiscal year end from the last day  in  February  to December
     31.



<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.

                      Diversified Product Inspections, Inc.
                                  (Registrant)


Date: August 14, 2002     /s/ John Van Zyll
                           ------------------------------------------
                           John Van Zyll
                           President, Chief Executive Officer and Chairman
                           (Principal Executive Officer and
                            Principal Accounting Officer)


                           CERTIFICATIONS PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

     In connection with the Quarterly Report of Diversified Product Inspections,
Inc.  (the  "Company")  on  Form  10-QSB for the period ending June 30, 2002, as
filed  with  the  Securities  and  Exchange  Commission  on the date hereof (the
"Report"),  the undersigned, Chief Executive Officer and Chief Financial Officer
of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant
to  Section  906  of  the  Sarbanes-Oxley  Act  of  2002,  that:

(1)  The Report fully complies with the requirements of section 3(a) or 15(d) of
     the  Securities  and  Exchange  Act  of  1934;  and

(2)  The  information  contained  in the Report fairly presents, in all material
     respects, the financial condition and results of operations of the Company.

                         /s/ John Van-Zyll
                         ______________________________________
                         By: John Van-Zyll
                         Chief Executive Officer/Chief Financial Officer
                         August 14, 2002


<PAGE>

EXHBIT 99

                               Preferablity Letter


July  19,  2002


Board  of  Directors
Diversified  Product  Inspections,  Inc.

Note  2  of  Notes to Consolidated Condensed Financial Statements of Diversified
Product  Inspections,  Inc.  included  in  its  10-QSB  for  the three-month and
six-month periods ended June 30, 2002 describes a change in fiscal year-end from
the  last  day of February to December 31.  You have advised us that you believe
that  the  change  is  a  preferable  fiscal year-end as it corresponds with the
fiscal  year-end  of  your  subsidiary  operating  company,  Diversified Product
Investigations,  Inc.

We  conclude  that  the  change  in fiscal year-end is an acceptable alternative
which,  based on your business judgment to make this change for the reason cited
above,  is  preferable  in  your  circumstances.


     Sincerely,


     /s/  Coulter  &  Justus,  PC
     Knoxville,  Tennessee