<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                   FORM 10-KSB

                     ANNUAL REPORT UNDER SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                      For Fiscal Year Ended: March 31, 2001
                        Commission File Number: 001-15043

                         CHEQUEMATE INTERNATIONAL, INC.
                         ------------------------------
             (Exact name of registrant as specified in its charter)

                   Utah                                      76-0279816
      --------------------------------                  -------------------
       (State or other jurisdiction                      (I.R.S. Employer
     of incorporation or organization)                  Identification No.)


                 124 Point West Boulevard, St. Charles, MO 63301
            ---------------------------------------------------------
                    (Address of principal executive offices)


                                 (636) 724-1004
                           --------------------------
                           (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 requirement for the past 90 days. YES X No

     State issuer's revenues for its most recent fiscal year: $905,070

     Check if there is no disclosure of delinquent filers pursuant to Item 405
of Regulation S-B contained in this report and no disclosure will be contained
to the best of registrant's knowledge in definitive proxy or information
statements incorporated by reference in Part 111 of this Form 10-KSB or any
amendment to this Form 10-KSB: [ ]

     As of July 9, 2001 the aggregate market value of the voting stock held by
non-affiliates computed by reference to the price at which the common equity was
sold, or the average bid and asked price of such common equity as of a specified
date within the past 60 days: $3,723,523.

     State the number of shares outstanding of each of the issuer's common
equity, as of the latest practicable date: 25,680,581 as of July 9, 2001.

     Transitional Small Business Format: YES / /  NO /X/

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<S>                                                                                   <C>
PART I ..............................................................................       4

    ITEM 1 ..........................................................................       4
       Forward Looking Statements ...................................................       4
       Incorporation Of Certain Documents By Reference ..............................       4
       History of the Company .......................................................       4
       Other Information ............................................................       6
       Principal Products and Services ..............................................       7
       Patents, Trademarks and Copyrights ...........................................       8
       Employees ....................................................................      10

    ITEM 2 ..........................................................................      11
       Description of Property ......................................................      11

    ITEM 3 ..........................................................................      11
       Legal Proceedings ............................................................      11

    ITEM 4 ..........................................................................      11
       Submission of Matters to a Vote of Security Holders ..........................      11

PART II .............................................................................      12

    ITEM 5 ..........................................................................      12
       Market for Common Equity and Related Stockholder Matters .....................      12

    ITEM 6 ..........................................................................      13
       Management's Discussion and Analysis of Financial Condition and
       Results of Operations ........................................................      13

    ITEM 7 ..........................................................................      19
       Financial Statements .........................................................      19
       Independent Auditors Report ..................................................      21
       Consolidated Balance Sheets ..................................................      22
       Consolidated Statements of Operations ........................................      24
       Consolidated Statements of Stockholders' Equity (Deficit) ....................      26
       Consolidated Statements of Cash Flows ........................................      27
       Notes to Consolidated Financial Statements ...................................      29

    ITEM 8 ..........................................................................      44
       Changes in and Disagreements with Accountants on Accounting
       and Financial Disclosure .....................................................      44

PART III ............................................................................      44

    ITEM 9 ..........................................................................      44
       Directors, Executive Officers, Promoters and Control Persons;
       Compliance with Section 16(a) of the Exchange Act ............................      44
       Directors ....................................................................      44
       Business Experience ..........................................................      45
       Committees of the Board of Directors .........................................      46
       Executive Officers ...........................................................      46
       Business Experience ..........................................................      47

    ITEM 10 .........................................................................      47
       Executive Compensation .......................................................      47

    ITEM 11 .........................................................................      49
       Security Ownership of Certain Beneficial Holders .............................      49

    ITEM 12 .........................................................................      50
       Certain Related Transactions .................................................      50

    ITEM 13 .........................................................................      51
       Exhibits and Reports on form 8K ..............................................      51
</TABLE>

                                       2
<PAGE>

<TABLE>
<S>                                                                                   <C>
           Exhibits Index ...........................................................      51

    SIGNATURES ......................................................................      52

           Exhibit 10.1 - SETTLEMENT AGREEMENT NATIONAL FINANCIAL COMMUNICATIONS ....      53
           EXHIBIT 10.2 - AMENDED SETTLEMENT AGREEMENT BH PRODUCTIONS ...............      55
           EXHIBIT 10.3 - PROMISSORY NOTE I-O DISPLAY SYSTEMS .......................      57
           EXHIBIT 10.4 - SETTLEMENT AGREEMENT PROGRAMMING SERVICES, INC ............      58
           EXHIBIT 10.5 - ACADEMY ENTERTAINMENT SETTLEMENT ..........................      60
</TABLE>

                                       3
<PAGE>

     PART I

ITEM 1

FORWARD LOOKING STATEMENTS

     This annual filing includes "forward looking statements" within the meaning
of the Private Securities Litigation Reform Act of 1995 (the "PSLRA"). The PSLRA
provides a "safe harbor" for such statements to encourage companies to provide
prospective information about themselves so long as such information is
identified as forward-looking and is accompanied by meaningful cautionary
statements identifying important factors that could cause actual results to
differ materially from those projected in the information. All statements other
than statements of historical fact made in this report or incorporated by
reference are forward-looking. In particular, the statements herein regarding
the availability of adequate funding and progress in the development of its
various business segments are forward-looking statements. Forward-looking
statements represent management's current expectations and are inherently
uncertain. Investors are warned that the Company's actual results may differ
significantly from management's expectations and, therefore, from the results
discussed in such forward-looking statements.

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

The following documents and materials filed by the Company with the Commission
(File No. 1-15043) are incorporated herein by reference:

1.   The Company's Current Report on Form 8-K filed with the Commission on May
26, 2000;

2.   The Company's Annual Report on Form 10-KSB for the fiscal year ended March
31, 2000, filed with the Commission on July 14, 2000;

3.   The Company's Quarterly Report on Form 10-QSB for the three months ended
June 30, 2000, filed with the Commission on August 21, 2000;

4.   The Company's Current Report on Form 8-K filed with the Commission on
September 14, 2000;

5.   The Company's Quarterly Report on Form 10-QSB for the six months ended
September 30, 2000, filed with the Commission on November 14, 2000;

6.   The Company's Current Report on Form 8-K filed with the Commission on
January 9, 2001;

7.   The Company's Quarterly Report on Form 10-QSB for the nine months ended
December 31, 2000, filed with the Commission on February 14, 2001;

8.   The Company's Amendment to its Current Report on Form 8-K dated December
30, 2000, filed with the Commission on February 16, 2001;

9.   The Company's Current Report on Form 8-K filed with the Commission on March
2, 2001;

10.  The Company's amendment to its Quarterly Report on Form 10-QSB for the nine
months ended December 31, 2000, filed with the Commission on March 5, 2001;

11.  The Company's Proxy on schedule PRE14A, filed with the Commission on June
14, 2001;

All other documents and reports filed pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date of this filing shall be deemed
to be incorporated by reference in this filing and to be made a part hereof from
the date of the filing of such reports and documents. Any statement contained in
a document incorporated or deemed to be incorporated by reference shall be
deemed to be modified or superseded for purposes of this document to the extent
that a statement contained in the document, or in any subsequently filed
document, is deemed to be incorporated by reference or modifies or supersedes
the statement.

HISTORY OF THE COMPANY

     The Company was incorporated under the laws of the State of Texas on April
21, 1989 under the name Ainsley Corporation. We issued the initial shares of
common stock on April 25, 1989 (inception) and we were

                                       4
<PAGE>

organized primarily for the purpose of raising capital to take advantage of
potential business opportunities. The name of the Company was later changed to
Automated Compliance & Training, Inc. (AC&T), when the Texas corporation was
merged with a Utah corporation to make the change to Utah as the state of
incorporation. On September 3, 1996, AC&T merged with its wholly owned
subsidiary Chequemate International, Inc. (the "Company" or "CMI") and assumed
the name of the subsidiary.

     On April 17, 1997 CMI formed a new wholly owned subsidiary named Chequemate
Third Dimension, Inc. The name has since been changed to Chequemate Electronics,
Inc. (CE). CE was formed to manufacture and market breakthrough 3D imaging
technology that was acquired from Advanced Technology Group, LLC (ATG). On June
23, 1997 an agreement was finalized by which CE obtained the exclusive worldwide
license to the 3D technology developed by ATG.

     On November 12, 1998 we sold the assets associated with the financial
service segments of the business to TFL, LLC with its two principals being
former Chequemate International employees. Both TFL, LLC and Chequemate
International continues to use the name Chequemate International, although we
have filed for, and are operating under the fictitious name of C-3D Digital,
Inc.

     On December 8, 1998 we purchased from Alpha Broadcasting Corporation
inventory, equipment and contracts to provide pay-per-view television services
to 19 hotel properties amounting to roughly 3,000 hotel rooms. The purchase
price was $1,000,000 and was accomplished through a combination of 250,000
(pre-split) shares of restricted stock valued at $2.00 each, $60,000.00 cash,
and a note for $440,000. On July 2, 1999 we purchased additional equipment and
contracts to provide pay-per-view television services to an additional 21
properties. The purchase of these assets was accomplished for the sum of
$150,000 cash and 125,000 (pre-split) shares of restricted common stock of the
Company.

     On December 10, 1998 and March 31, 1999, we acquired the debt position of
several secured investors in Strata, Inc., a 3D software provider. On June 16,
1999 these debt positions were used to foreclose on the assets and technology
previously owned by Strata, Inc. We continue to market the developed software
products of Strata.

     On June 10, 1999, 3D.COM, Inc., was formed under Utah law, and on October
21, 1999, this wholly-owned subsidiary held its organizational meeting. It is
management's intention to transfer all the software development and Internet
related assets of the Company to this subsidiary.

     On February 2, 2000, we effected a one-for-four reverse split our
outstanding stock.

     In December, 2000, we consummated a Stock Purchase Agreement between the
Company, VisionComm, Inc. ("VCI") and the shareholders of VCI. In connection
with the Stock Purchase Agreement, the terms of which are described in detail in
a Current Report on Form 8-K filed with the Commission on January 9, 2001, two
of the officers and directors of VCI were appointed, in the beginning of
February, 2001, as additional members of the board of directors of the Company.

     On March 15, 2001, we entered into a Master Agreement as amended and
re-stated, and then modified and restated on June 13, 2001, which contemplates a
private placement to raise up to $3.5 million in return for the Issuance of
approximately 43,125,565 Shares to the New Investors, constituting a 51% equity
interest in the Company on a fully diluted basis. These newly-issued Shares will
have registration rights customary in such issuances as set forth in the
Registration Rights Agreements attached to the Proxy Statement filed on June 14,
2001 in Exhibit 99(a) as Schedule 1.3 to the Master Agreement. Under the Master
Agreement, the Company can acquire control of Another World and its assets at a
later date (the "Acquisition") so that we can benefit from its stereoscopic
technologies provided the shareholders of the Company and Another World approve
the transaction. The Acquisition will be based on an independent valuation of
Another World. Another World has engaged Samil/PricewaterhouseCoopers to perform
such independent valuation.

                                       5
<PAGE>

     We propose to Issue approximately 43,125,565 Shares to approximately
200 New Investors, constituting a 51% equity interest in the Company on a
fully diluted basis, in return for $3.5 million. The Issuance will result in
a change of ownership and a change of control of the Company. The Board
believes the Issuance is in the best interests of the Company and that the
Issuance will benefit Shareholder value. The Issuance will be conducted by a
private placement under Regulation S of the Securities Act. The New Investors
are "non-U.S. Persons" as that term is defined in Regulation S of the
Securities Act.

     We urgently need the $3.5 million cash infusion for our operations, to
improve our cash-flow position and to meet some of the continued listing
requirements of the American Stock Exchange. We also need the cash infusion
to implement our expansion strategy. The $3.5 million cash infusion will help
us meet these needs. The Issuance will be made according to a subscription
agreement ("Subscription Agreement") attached to the Master Agreement. The
Subscription Agreement can be found at the end of Exhibit 99(a) reference is
made to the Company's Proxy on schedule PRE14A, filed with the Commission on
June 14, 2001. The contemplated private placement with the New Investors who
are familiar with our lines of business will provide synergy in terms of
technology sharing and transfer to the Company.

     We intend to use the $3.5 million raised for the following business
purposes: $250,000 for repayment of our outstanding debts; $2.5 million for
3D products marketing, sales, development and content distribution, and
$750,000 for other working capital purposes. Depending on the actual business
needs, the actual use of proceeds may vary from the use mentioned above.

     Most of the New Investors are shareholders of Another World Inc., a company
established under the laws of the Republic of Korea ("Another World"). Based on
very preliminary estimates, the New Investors who have overlapping ownership in
Another World will together own most of the 43,125,565 Shares that will be
issued by the Company in the Issuance. Due to the fact that the private
placement has not yet been completed, the exact overlapping ownership
information is not available.

     The New Investors may individually own at least 5% of the Company after
the Issuance. The final percentage distribution of beneficial ownership
interests in Chequemate among the New Investors may vary depending on the
final private placement funding contributions. Reference is made to the
Company's Proxy on schedule PRE14A, filed with the Commission on June 14,
2001.

OTHER INFORMATION

     During the months of August and September, we substantially shut down our
24 hour per day television network operation known as C-3D TV. The costs of
operations and marketing of our television network operation were prohibitive.
We will continue to develop and market 3D products and technology for the PC and
TV markets.

     In November of 2000, Alan Hunter resigned as Secretary of the Company. In
approximately the end of October, 2000, Harold Glick resigned as a director of
the Company. On November 29, 2000, Chandos Mahon was appointed as the Company's
new Chief Operating Officer. Mr. Mahon was engaged in order to facilitate the
recent restructuring and broadening of our media resources, and to assist the
Company in focusing on consolidation and earnings. For biographical information
regarding Mr. Mahon see details in Item # 9.

     We have entered into an employment agreement dated December 1, 2000, with
Mr. Mahon. Under the terms of Mr. Mahon's employment agreement, we originally
engaged Mr. Mahon as Chief Operating Officer, and beginning April 1, 2001, Mr.
Mahon was elected President/CEO of the Company. For biographical and contract
information regarding Mr. Mahon, reference is made to the Company's 10QSB filed
on March 5, 2001.

     In the beginning of January, 2001, William J. Brinkmeier II, and Thomas A.
Nix, officers and directors of VisionComm, Inc., were appointed as additional
directors of the Company. For biographical information regarding Messrs.
Brinkmeier and Nix, see details in Item # 9.

                                       6
<PAGE>

     In January, 2001, Mr. Mahon was appointed as our Secretary/Treasurer.

     On March 1, 2001, Mr. Mahon was appointed President/Chief Executive
Officer, to fill the vacancies left by the resignation of J. Michael Heil in
such positions.

PRINCIPAL PRODUCTS AND SERVICES

VISIONCOMM

     VisionComm, Inc. ("VCI") was founded in 1995 for the purpose of becoming a
provider of telecommunications and cable television services to residents of
multiple dwelling units (MDUs), hotels and hospitals. VCI's corporate
headquarters are located in St. Charles, Missouri.

     VCI operates through two divisions--the CABLE DIVISION and the PAYPHONE
DIVISION.

     THE CABLE DIVISION is headquartered in Clinton Township, Michigan, a suburb
of Detroit. Cable Division Operations is headed by Larry Wilk and Cable Division
Sales and Marketing is headed by Tom Nix. Mr. Wilk and Mr. Nix have over 45
years of combined experience in the private cable business. The Cable Division
manages a nationwide network of contractors, provides engineering and planning
for new installations and customer service for VCI's cable subscribers and
oversees all other aspects of the Company's cable business. Subscriber billing
and collection are handled at the St. Charles office.

     VCI's initial cable systems were acquired from United Satellite/USA, Inc.,
in June of 1996. Today, VCI operates private cable systems in three states
(Texas, California and Michigan) and manages two franchise cable systems in
Missouri, in total covering 6,000 passings. The following communities are under
franchise agreements with VisionComm. These franchise agreements were purchased
from Phoenix Communications. All assignments and transfers were obtained. These
cable systems need to be built out within the next 16 months per the franchise
agreements.

Chester Township
Charlton Township
Vienna Township
Weber Township
Yates Township
Elk Township
Sauble Township

     VCI's PAYPHONE DIVISION is headquartered in St. Charles, Missouri. The
Payphone Division is headed by William Brinkmeier, President and a director, who
has worked in the private payphone business since 1989, when he and Stan
Rojeski, a director of VCI, founded Payphones of America, Inc. From 1989 to 1995
Payphones of America increased its operating payphones to 3,300. In 1996
Payphones of America was sold to PhoneTel Technologies, Inc. Proceeds from the
sale were used in the initial funding of VisionComm.

     In 1995, VisionComm entered into a ten-year contract with Nevada
Communications Corp. to provide payphone services to a large Healthcare
Corporation's hospitals and healthcare facilities throughout the United States,
on an exclusive basis. As of August 2000, VisionComm had installed 1,000 phones
in facilities in 18 states.

     VCI is focusing on the continued growth efforts in the private cable
division. The growth, as planned, will encompass both acquisitions and the
construction of new cable locations, with VCI's initial concentration on
acquisitions. VCI plans to target areas of the country where it has a current
presence, as it is believed this will

                                       7
<PAGE>

allow for economies of scale. VCI will also seek growth by exploring "Add On"
possibilities at its existing properties, such as cable modem services.

     VCI is currently attempting to sell the Payphone Division, so it may devote
its full energies to growing the Cable Division. There can be no assurance VCI
will be successful in finding a suitable buyer, or, if a suitable prospective
buyer is found, that VCI will be able to negotiate acceptable terms.

HOTEL MOVIE NETWORK

     Another key business segment of Chequemate International is its hotel
Pay-Per-View and direct digital television services or "Free to Guest" services,
called the Hotel Movie Network. We became involved in this business area through
acquisitions from Alpha Broadcasting Corporation. In the acquisitions, we
purchased a combination of operating service contracts with additional inventory
to outfit hotels for Pay-Per-View and "Free to Guest" services.

     Our interest in the hotel market is as a focused test market for its 3D
technologies and as a stable revenue source. Currently the company delivers
television programming to approximately 11,000 hotel rooms. The hotel properties
are primarily located in Arizona, California, Idaho, Nevada, New Mexico, Texas,
Utah and Washington.

3D.COM DIVISION
STRATA SOFTWARE DIVISION

     On June 16, 1999, We formed the 3D.COM division by completing the process
of acquiring the assets and technology previously owned by Strata, Inc., and
combining them with the internal web effort of the Company. We then hired former
Strata, Inc. employees to support and sell the Strata products. Strata, Inc. was
one of the early pioneers in 3D software. The Strata tool line has been used for
such well-known projects as the game "MYST"(c); television shows like the "98
MTV Movie (c) Awards" (c),"Hercules" (c) and "Xena" (c); the NBC dancing
peacocks; the Warner Bros and Blockbuster web sites; the films "Contact" (c),
"5th Element" (c), "Batman Forever" (c), and many others.

     The core Strata products that will continue to be offered by the Company,
are the following:

     Strata 3DPro(TM). Strata 3DPro is the premier 3D software product of the
Company and is available for Apple Macintosh, Windows 98, 2000 and NT. Strata
3DPro is used for creating 3D images and animations for the web, video, movies,
print, games and multimedia. Strata 3DPro is well known for being used to create
the graphics for the world's best selling CD-Rom game, Myst (c). Recently Strata
3DPro has been used on projects such as the Blockbuster Video Web site, the NBC
dancing peacocks and the movie CONTACT. The latest release adds special
stereographic 3D features. Strata 3DPro has an installed base of approximately
100,000 users.

     VideoShop. VideoShop is a professional quality non-linear video editor and
presently runs only on Apple Macintosh computers. VideoShop is used primarily
for multimedia, web and desktop video tasks. It has been bundled on select
Macintosh computers for over five years and has developed an installed base of
well over one million customers through this process.

     MediaPaint(TM). MediaPaint is a video painting and effects application.
MediaPaint is available for Apple Macintosh, Windows 98 and NT. MediaPaint is
used for professional projects on the Web, multimedia and broadcast video.
MediaPaint has an installed base of approximately 6,000 users.

PATENTS, TRADEMARKS AND COPYRIGHTS

     On June 23, 1997, we acquired an exclusive, worldwide and perpetual license
to the Realeyes proprietary three-dimensional video technology and subsequently
filed U.S. provisional patent application number 60/034,149

                                       8
<PAGE>

with regard to aspects of such technology. We have proceeded to file additional
patent applications, including a U.S. utility application, Serial No.
08/997,068, with regard to the system and method of synthesizing
three-dimensional video from a two-dimensional video source. Patent Cooperation
Treaty (PCT) national phase patent applications based upon this technology have
been filed in Australia, Brazil, Canada, China, Japan, Europe and Mexico. An
International Patent Application under the Patent Cooperation Treaty (PCT) was
filed with regard to a system and method for recording and broadcasting
three-dimensional video synthesized from a two-dimensional source. All countries
that are members of the PCT were designated in this PCT application.

     On June 16, 1999, we acquired certain copyrights and trademarks relative to
the technology and products of its Strata Division.

The Company currently owns or licenses the following U.S. and foreign patents:

<TABLE>
<CAPTION>
Patent/Product            Application or      Country     Granted or Filed      Year of expiration or
                          Registration No.                                            Renewal
-----------------------   ----------------    -------     -----------------     ---------------------
<S>                       <C>                 <C>         <C>                   <C>
Chequemate 2D to 3D       08/997,068           U.S.A.     December 23, 1997           Pending
Chequemate 2D to 3D       P-19713629-8        Brazil      December 24, 1997           Pending
Chequemate 2D to 3D       2,276,190            Canada     December 24, 1997           Pending
Chequemate 2D to 3D       97181060.5          China       December 24, 1997           Pending
Chequemate 2D to 3D       10-530238            Japan      December 24, 1997           Pending
Chequemate 2D to 3D       97953466.6          Europe      December 24, 1997           Pending
Chequemate 2D to 3D       996050              Mexico      December 24, 1997           Pending
Chequemate Recording and  60/114,264           U.S.A.     December 30, 1998        Converted to PCT
Broadcasting 3D from 2D   PCT/US99/31233                                           December 30, 1999
</TABLE>

     The Company currently owns or licenses the following U.S. copyrights:

<TABLE>
<CAPTION>
Copyright/Product         Registration No.    Country        Granted
-----------------         ----------------    -------     -----------------
<S>                       <C>                 <C>         <C>
StrataVISION 3D           TX 2,688,747         U.S.A.     October 2, 1989
AIM - 3D                  TXu 507, 718         U.S.A.     February 13, 1992
</TABLE>

                                       9
<PAGE>

     The Company currently owns or licenses the following U.S. and foreign
trademarks:

<TABLE>
<CAPTION>
Trademark/Product             Registration No.     Country     Granted or Filed      Year of expiration or
                                or Serial No.                                              Renewal
------------------------      ----------------     -------     -----------------     ---------------------
<S>                           <C>                  <C>         <C>                   <C>
C-3D Digital class 38           75/605,796          U.S.A.     December 15, 1998           Pending
C-3D Digital class 9            75/605,795          U.S.A.     December 15, 1998           Pending
C-3D class 9                    75/605,794          U.S.A.     December 15, 1998           Pending
C-3D class 38                   75/605,904          U.S.A.     December 15, 1998           Pending
3D.COM class 42                 75/729,813          U.S.A.     June 16, 1999               Pending
3D TRAVEL class 38              75/279,982          U.S.A.     June 16, 1999               Pending
3D SPORTS class 9               75/729,984          U.S.A.     June 16, 1999               Pending
3D SPORTS class 38              75/729,985          U.S.A.     June 16, 1999               Pending
3D TRAVEL class 42              75/729,812          U.S.A.     June 16, 1999               Pending
3D SPORTS class 25              75/729,811          U.S.A.     June 16, 1999               Pending
3D SPORTS class 42              75/729,031          U.S.A.     June 16, 1999               Pending
STRATAVISION 3D                  1,606,234          U.S.A.     July 17, 1990            July 17, 2000
STUDIOPRO                        1,892,027          U.S.A.     May 2, 1995              May 2, 2001 (1)
MEDIAPAINT                       2,042,281          U.S.A.     March 4, 1997            March 4, 2003 (1)
POWERING THE CREATIVE            2,098,858          U.S.A.     September 23, 1997     September 23, 2003 (1)
ENVIRONMENT
STRATAVISION                    TMA404,400          Canada     November 6, 1992         November 6, 2007
TELECHARGE                       2,241,551          U.S.A.     April 27, 1999            April 27, 2009
TELECHARGE SIMPLE ACCESS         2,241,550          U.S.A.     April 27, 1999            April 27, 2009
</TABLE>

The Company has also licensed other technology regarding its Strata product line
that enables the Company to offer certain of its Strata products on the
Microsoft Windows 95 (or higher), operating system.

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

     (1)  Affidavits of Continued Use are due by this date. If filed the
trademark will be valid for ten years from the date of grant. If not filed the
trademark will expire on this date.

EMPLOYEES

     As of June 29, 2001, the Company and its subsidiaries had 18 full time
employees, and 4 consultants.

                                       10
<PAGE>

ITEM 2.

DESCRIPTION OF PROPERTY

     The Company occupies leased office space at: 1030 S. Mesa Drive $3000.00
per month 4000 sqf. (10 Year lease started March 2000) Lease 951 Old Country
Road Suite 195 Belmont, CA $1100.00 per month 900 sqf. (Month to Month) Lease
5018 Bristol Industrial Way #202 Buford, GA $2200.00 per month 3000 sqf (Lease
ends July 31 2001) Leases: St. Charles, Missouri Office, 9600 square feet,
$5750.00 per month, Four years remaining on lease. Detroit, Michigan Office,
1800 square feet, $2935.00 per month, 18 months remaining on lease. Grand
Prairie, Texas Office, 900 square feet, $842.00 per month, 2 months remaining on
lease.

ITEM 3.

LEGAL PROCEEDINGS

     On November 14, 2000, the Company and its Chief Executive Officer, J.
Michael Heil ("Heil"), were named as defendants in a complaint filed by Trimark
Pictures, Inc. ("Trimark"), in the Superior Court for the State of California,
County of Los Angeles (TRIMARK PICTURES, INC. V. CHEQUEMATE INTERNATIONAL, INC.,
D/B/A C-3D DIGITAL, INC., J. MICHAEL HEIL, ET AL.; Case No. SC063992) (the
"Trimark complaint"). The Trimark complaint alleges that the Company and Heil
breached the terms of a contract between the Company and Trimark dated February
8, 2000 (the "Trimark contract"), by failing to register a total of 100,000
shares of the Company's restricted common stock issued to Trimark pursuant to
the terms of the Trimark contract. Under the terms of the Trimark contract, the
Company issued to Trimark a total of 100,000 shares of restricted common stock
(the "Trimark shares"), and agreed to immediately undertake the registration of
the Trimark shares, in exchange for the license to the Company of up to fifty
(50) pictures from Trimark's library for digitalization by the Company. The
Trimark complaint also asserts a claim for fraud against the Company and Heil,
alleging that, prior to execution of the Trimark contract, the Company and Heil
made false promises and representations to Trimark concerning the Trimark
shares, for the purpose of inducing Trimark into entering into the Trimark
contract. Trimark claims substantial damages arising from the alleged breach of
contract and misrepresentations, in the amount of $1,650,000. We are currently
engaged in settlement discussions with Trimark and we have reached a settlement
in general terms and are awaiting proper documentation resolving the entire
matter. In the event these discussions are not successful, the Company and Heil
intend to vigorously defend this case, raising a number of defenses, including,
among other things, issues regarding the consideration received from Trimark;
and the actual damages actually suffered by Trimark because of the alleged
breach of contract.

     During the period ending March 31, 2001 we were engaged in restructuring
and in focusing on consolidation. In the process of consolidation a number of
employees and contractors were released and we are currently engaged with
settlement negotiations with many of these employees and contractors. In the
event these discussions and negotiations are not successful, we may be faced
with additional legal repercussions from these individuals.

     There may be other ongoing litigation not deemed material by management.
For a description of all recent litigation and settlements, reference is made
to the Company's quarterly report on Form 10-QSB for the quarter ended
December 31, 2000 filed with the Commission on March 12, 2001 and the
settlements attachments made hereto.

ITEM 4.

SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     No matters were submitted to a vote of security holders during the fourth
quarter of the fiscal year ending March 31, 2001.

                                       11
<PAGE>

     PART II

ITEM 5

MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

     The stock of the Company is traded on the American Stock Exchange under the
symbol DDD. The listing on the American Stock Exchange took place on June 9,
1999. Prior to that date, the Company's stock had been traded on the OTC
Bulletin Board under the symbol CQMT of the NASD Stock Market, Inc. As of June
25, 2001, there are approximately 900 shareholders of record of the Company. As
of June 25, 2001, the Company had issued and outstanding shares of 25,680,581.
The stock of the Company, as of June 25, 2001, closed at $0.19.

     The NASD Stock Market, Inc. provided the fiscal year 1999 quotations for
the Company's stock. The referenced quotations reflect inter-dealer prices
without dealer mark-up, markdown or commissions and may not represent actual
transactions. These prices have been adjusted to reflect the reverse split of
the Company's common stock declared to be effective February 2, 2000.

Yahoo! provided the fiscal year 2000 quotations for the Company's stock.

<TABLE>
<CAPTION>
Fiscal Year                        High Closing Price     Low Closing Price
------------------------------     ------------------     -----------------
<S>                                <C>                    <C>
2000-1st Quarter (4/99-6/99)             13.50                   7.00
2000-2nd Quarter (7/99-9/99)             13.25                   6.25
2000-3rd Quarter (10/99-12/99)           12.50                   4.00
2000-4th Quarter (1/00-3/00)             18.44                   7.25

2001-1st Quarter (4/00-6/00)              8.87                   3.12
2001-2nd Quarter (7/00-9/00)              3.93                   1.00
2001-3rd Quarter (10/00-12/00)            1.19                   0.25
2001-4th Quarter (1/01-3/01)              0.81                   0.15
</TABLE>

     The Company has paid no dividends on common stock during its two most
recent fiscal years, and has no present intention to pay dividends in fiscal
year 2001.

                                       12

<PAGE>

ITEM 6

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

     Fiscal year March 31, 2001 compared to March 31, 2000 (as restated for
discontinued operations).

     In November 2000 the Company determined to discontinue its Strata division.
The Company leased its tangible and intangible Strata assets back to a company
controlled by the founders of Strata. The lease agreement was for minimal
consideration and served as a mechanism for the planned future sale or spin off
of Strata as a separate company. Accordingly the operations of Strata are
excluded from the operating results of the Company.

     In December 2000 the Company purchased 100% of VisionComm, Inc. a St.
Louis, Missouri based cable television and payphone company. Vision Comm
operates on a calendar year end accordingly none of the operations of VisionComm
are included in the Company's consolidated financial statements. However the
balance sheet of VisionComm is included in the consolidated balance sheet of the
Company as of March 31, 2001.

     The Company's current assets increased by $301,872 from March 31, 2000 to
March 31, 2001. The increase is the result of the purchase of VisionComm Inc.
and inclusion of its accounts receivable in the Company's current assets. Over
the same period total liabilities increased by $4,825,277. This increase was
also the result of the purchase of VisionComm and the inclusion of its
liabilities in the Company's consolidated financial statements.

     The purchase of Vision Comm resulted in the creation of $5,335,881 of
goodwill and a net increase in fixed assets of $1,080,473. The Company will
evaluate the recoverability of its goodwill on at least an annual basis. The net
assets of the Company's investment in Strata have been grouped together as
discontinued operations. The Company expects to recover its investment in Strata
through the sale or spin off of Strata. The Company raised $2,800,000 of capital
from the sale of its common stock. The Company also settled stock debt of
$4,039,936 for stock.

Liquidity and Capital Resources

     The Company continues to be dependent on investment capital to fund its
operations. The Company expects to receive approximately $3,500,000 upon
completion of the Another World Private Placement. The Company has also
established an equity line of credit but has determined to not make any draws on
the line of credit through June 30, 2001. Even upon the completion of the
Another World Private Placement the Company will have a deficit in its working
capital. There is no assurance that the Company will be able to attract
sufficient investment capital to fund its operations. Also the Another World
transaction is subject to shareholder approval and certain deadlines.

Results of Operations

     The Company revenues for the year ended March 31, 2000 have been restated
to reflect Strata as discontinued operations. The sales of Strata have been
removed from the consolidated

                                       13
<PAGE>

numbers as have the related operating expenses.

     Sales for the year ended March 31, 2001 were $905,070 compared to $491,779
for the prior year, an increase of 84%. These sales were the result of the
growth of Hotel Movie Network. If the Company had owned VisionComm for all of
2000 sales would have been $3,580,705 on a proforma basis.

     The Company's gross margin was $379,229 or 42% compared to $262,464 or 53%
in the prior year.

     General and administrative expenses increased by $10,402,239. This increase
was primarily the result of shares and options which were issued for services
and in settlement of various claims against the Company. The shares and options
were valued at their estimated fair value and resulted in an expense of
$10,821,527.

Fiscal year March 31, 2000 compared to March 31, 1999

     The Strata software products generated in excess of $1,800,000 in revenue
in the 2000 fiscal year. The Company discontinued the Strata product line in
2001.

     The hotel pay-per-view segment currently generates roughly $80,000 a month
in revenue. This business will serve as an internal test market for providing 3D
entertainment to hotel guests. The Company has adapted its 3D technology to work
through the hotel pay-per-view system and is seeking additional hotel properties
in which to conduct market testing.

CURRENT ASSETS

<TABLE>
<CAPTION>
                                                                      MARCH 31,
                                                            -----------------------------
                                                               2000               1999
                                                            ----------         ----------
<S>                                                         <C>                <C>
Cash                                                        $   49,475         $1,732,199
Accounts receivable - net of allowances of $422,096
  and $53,820 in 1999 and 1998, respectively                   213,268            197,922
Inventory                                                      727,512          3,115,763
Prepaid expenses                                                74,170            198,349
                                                            ----------         ----------
Total Current Assets                                         1,064,425          5,244,233
                                                            ----------         ----------
</TABLE>

     Current Assets of the Company are made up of Cash, Accounts Receivable,
     Inventory and Prepaid expenses.

     Accounts Receivable reflects only the accounts and new sales for these
     accounts that have been collected from April 1, 2000 through June 26, 2000.
     Reserves for all other accounts have been made.

     The Company has written off the "RealEyes" inventory that it held on the
     books for the prior year. The Company's inventory is now made up of the
     following

                                       14
<PAGE>

     components:

INVENTORY

<TABLE>
<CAPTION>
                                                     March 31,
                                           -----------------------------
                                              2000               1999
                                           ----------         ----------
<S>                              <C>                          <C>
          Finished goods         $            727,512         $1,035,682
          WIP                                      --          1,076,880
          Raw goods                                --          1,003,201
                                           ----------         ----------
                                           $  727,512         $3,115,763
                                           ==========         ==========
</TABLE>

The finished goods were made up of three components. Inventory used for viewing
three dimensional television, software products sold by 3D.COM and units used in
the Home Movie Network for installation of the delivery systems in hotels for
the pay per view and "free to guest" movies.

Prepaid expenses were costs of demonstrations, shows and other promotional
activities that are paid in advance. These costs are expensed after the
demonstrations, shows or other promotional activities have concluded.

PROPERTY AND EQUIPMENT

<TABLE>
<CAPTION>
                                                                                    Net Book Value
                                                        Accumulated         -----------------------------
                                         Cost           Depreciation           2000              1999
                                      ----------        ------------        ----------         ----------
<S>                                   <C>               <C>                 <C>                <C>
Office furniture and fixtures         $  168,465         $   41,571         $  126,894         $   24,320
Machinery and equipment                1,209,061            260,048            949,013            569,488
Hotel pay-per view equipment             470,313            117,579            352,734                 --
                                      ----------         ----------         ----------         ----------
     Total                            $1,847,839         $  419,198         $1,428,641         $  622,717
                                      ==========         ==========         ==========         ==========

</TABLE>

     The change in Net Book Value between FY 1999 and FY 2000 is due to
purchases of equipment and other personal property.

OTHER ASSETS

<TABLE>
<CAPTION>
                                      2000              1999
                                    ---------         ---------
<S>                                 <C>               <C>
Notes receivable                       50,000            65,000
Product rights                      2,548,259         2,534,532
Movie production cost (net)           809,640
Secured interest                                      1,198,530
Refundable deposits                    47,159            15,704
Investments                                --             3,000
                                    ---------         ---------
   Total Other Assets               3,455,058         3,816,766
                                    ---------         ---------
</TABLE>

                                       15
<PAGE>

     The Company's Note Receivable was the result of a sale of the Chequemate
name and business.

     Refundable deposits were primarily for office space, satellite use and some
utility deposits.

     The Company's most valuable assets were Product rights and Movie production
costs.

PRODUCT RIGHTS

<TABLE>
<CAPTION>
                                                          Net Book Value
                                                          --------------
                               Term            Cost        Amortization       2000            1999
                             ---------     -----------     ------------    -----------     -----------
<S>                          <C>           <C>             <C>             <C>             <C>
Product rights               4-5 years     $ 3,948,268     $ 1,659,038     $ 2,289,230     $ 2,423,399
Contract/movie rights        2-5 years         324,559          65,530         259,029         111,133
                             ---------     -----------     -----------     -----------     -----------
                                           $ 4,272,827     $ 1,724,568     $ 2,548,259     $ 2,534,532
                                           ===========     ===========     ===========     ===========
</TABLE>

     Product Rights consisted of the Company's 3D technologies that include the
ability to convert 2D products to 3D products, the ability to film with special
3D cameras, the ability to manufacture 3D items with the Strata product line,
and rights to certain content that can be converted to 3D products to be
distributed through the television channel, video, and DVD.

CURRENT LIABILITIES

<TABLE>
<CAPTION>
                                            2000               1999
                                         ----------         ----------
<S>                                      <C>                <C>
Accounts payable                         $1,089,974         $  871,116
Short-term obligations                    1,972,502                 --
Related party accounts payable                                  25,292
Accrued expenses                            376,391             38,672
Income tax payable                              500                500
Accrued interest - related party                                79,943
Accrued interest payable                    123,605             39,791
Current portion related party                                  140,000
Current portion long-term debt            3,625,787            227,610
Current portion capital lease                    --             13,602
                                         ----------         ----------
     Total Current Liabilities            7,188,759          1,436,526
                                         ----------         ----------
</TABLE>

     The increase in the current liabilities was due to new rules pertaining to
notes that will later be paid by the Company's issue of common stock. During the
first quarter of 2001 the accounts payable of the Company were significantly
reduced. Short-term obligations represent various agreements and commitments for
services to be rendered to the Company. These

                                       16
<PAGE>

obligations were paid in common stock of the Company after approval by the Board
of Directors. The Board approved the agreements and the stock was then issued in
the first quarter of 2001. The Company recorded the obligations as a liability
pending the issuance of the stock in the first quarter of 2001. This transaction
put the Company's capital account into a negative position until the issuance of
the stock in the first quarter of 2001.

     Accrued expenses were payroll taxes owed to the IRS and State of Utah.
Arrangements for the payment of these obligations have been made and these debts
are in the process of being retired.

STOCKHOLDERS' EQUITY (DEFICIT)

<TABLE>
<S>                                                         <C>                   <C>
Common stock, $0.0001 par value, 500,000,000 shares
 authorized, 6,781,669 and 5,589,662 shares
 outstanding at 1999 and 1998, respectively                          678                   558
Capital in excess of par                                      36,900,982            24,463,118
Accumulated deficit                                          (38,142,295)          (19,406,486)
                                                            ------------          ------------
   Total Stockholders' Equity (Deficit)                       (1,240,635)            5,057,190
                                                            ------------          ------------
   TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
                     (DEFICIT)                              $  5,948,124          $  9,683,716
                                                            ============          ============
</TABLE>

     The negative position of the capital account of the Company was the result
of booking services of consultants until stock could be issued in the first and
second quarters of 2001. It should be noted that during the first quarter of
2001 notes were converted to stock and additional capital was raised that
reversed the negative capital position of the company.

<TABLE>
<CAPTION>
REVENUES                                     2000                 1999                1998
                                          -----------          -----------         -----------
<S>                                       <C>                  <C>                 <C>
  Sales - products                        $ 2,914,421          $   682,760         $ 1,091,794
                                          -----------          -----------         -----------
COST OF SALES
  Product, supplies and materials           4,502,165              631,132             849,919
                                          -----------          -----------         -----------
GROSS MARGIN (LOSS)                        (1,587,744)              51,628             241,875
                                          -----------          -----------         -----------
</TABLE>

     Sales showed a substantial gain over the prior two years. The sales gains
were due to the sale of the Strata software and Home Movie Network. The increase
in the cost of sales for the year over prior years was due largely to the
write-off of the "RealEyes" inventory. The Company's auditors have recommended
and the Company is in agreement with the concept of reserving for inventory
obsolescence each quarter to eliminate future possibilities of such write-offs.

                                       17
<PAGE>

EXPENSES

<TABLE>
<CAPTION>
                                          2000               1999               1998
                                       ----------         ----------         ----------
<S>                                    <C>                <C>                <C>
  Impairment of product rights                 --          3,133,333
  Bad debt expense                        487,221             53,820            138,259
  Selling expenses                      1,102,186            851,339          1,639,806
  General and administrative           15,170,567          3,074,839          3,430,005
                                       ----------         ----------         ----------
     Total Expenses                    16,759,974          3,979,998          8,341,403
                                       ----------         ----------         ----------
</TABLE>

     The Company's customers had previously been stable over the years, but this
year several of the Company's customers either filed petitions in bankruptcy or
changed their methods of distribution due to the Internet. As a result, the
Company has reserved for such contingencies in the future.

     Selling expenses were up from last year as the result of activities in
getting the cable channel started and the 3D.COM Internet portal open.

     General and administrative expenses increased due to consultant activities
in the creation of new content, consultant activities in aiding the Company in
obtaining additional capital, and the issuance to employees of options to
encourage their loyalty to the Company.

OTHER INCOME (EXPENSE)

<TABLE>
<S>                                            <C>                   <C>                   <C>
     Gain on forgiveness of debt                     29,375                    --
     Loss from discontinued operations                   --               (40,859)                   --
     Interest income                                 13,470                11,265                24,152
     Interest expense                              (430,436)              (93,779)              (18,478)
     Gain (loss) on sale of equipment                    --              (160,836)               70,309
                                               ------------          ------------          ------------
     Total Other Income (Expense)                  (387,591)             (284,209)               75,983
                                               ------------          ------------          ------------
LOSS BEFORE INCOME TAXES                        (18,735,309)           (4,212,579)           (8,023,545)

INCOME TAX PROVISION                                    500                   500                   500
                                               ------------          ------------          ------------
NET LOSS                                       $(18,735,809)         $ (4,213,079)         $ (8,024,045)
                                               ============          ============          ============
BASIC LOSS PER SHARE                           $      (3.09)         $      (0.94)         $      (2.37)
                                               ============          ============          ============
FULLY DILUTED LOSS PER SHARE                   $      (3.09)         $      (0.94)         $      (2.37)
                                               ============          ============          ============
WEIGHTED AVERAGE NUMBER OF
 SHARES OUTSTANDING                               6,064,075             4,496,046             3,392,211
                                               ============          ============          ============
</TABLE>

     Interest expense on the debt that was to be converted to Company stock was
the reason for the increase in other expense and income area.

                                       18
<PAGE>

                         CHEQUEMATE INTERNATIONAL, INC.
                                AND SUBSIDIARIES
                               (DBA C3-D DIGITAL)

                        CONSOLIDATED FINANCIAL STATEMENTS
                             MARCH 31, 2001 AND 2000



                                       19
<PAGE>

                                 C O N T E N T S

<TABLE>
<S>                                                                <C>
Independent Auditors' Report ..................................       21

Consolidated Balance Sheets ...................................       22

Consolidated Statements of Operations .........................       24

Consolidated Statements of Stockholders' Equity (Deficit) .....       26

Consolidated Statements of Cash Flows .........................       27

Notes to Consolidated Financial Statements ....................       29

</TABLE>


                                       20
<PAGE>

                          INDEPENDENT AUDITORS' REPORT


To the Board of Directors and Stockholders
Chequemate International, Inc. and Subsidiaries
(dba C3-D Digital)
St. Charles, Missouri

We have audited the accompanying consolidated balance sheets of Chequemate
International, Inc. and Subsidiaries (dba C3-D Digital) as of March 31, 2001 and
2000 and the related consolidated statements of operations, stockholders' equity
(deficit), and cash flows for the years ended March 31, 2001, 2000 and 1999.
These consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audits. We did not audit the financial
statements of VisionComm, Inc., a consolidated subsidiary, which statements
reflect total assets and revenue constituting 21% and 0%, respectively in March
31, 2001, of the related consolidated totals. Those statements were audited by
other auditors whose report has been furnished to us, and our opinion, insofar
as it relates to the amounts included for VisionComm, Inc., is based solely on
the report of the other auditors.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the consolidated financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the consolidated financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits and the report of
the other auditors provide a reasonable basis for our opinion.

In our opinion, based on our audits and the report of the other auditors, the
consolidated financial statements referred to above present fairly, in all
material respects, the consolidated financial position of Chequemate
International, Inc. and Subsidiaries (dba C3-D Digital) as of March 31, 2001 and
2000 and the consolidated results of their operations and their cash flows for
the years ended March 31, 2001, 2000 and 1999 in conformity with generally
accepted accounting principles.

The accompanying financial statements have been prepared assuming that
Chequemate International, Inc. and Subsidiaries (dba C3-D Digital) will continue
as a going concern. As discussed in Note 12 to the consolidated financial
statements, certain conditions raise substantial doubt about the Company's
ability to continue as a going concern. Management's plans concerning these
matters are also discussed in Note 12. The consolidated financial statements do
not include any adjustments that might result from the outcome of this
uncertainty.

HJ & Associates, LLC
Salt Lake City, Utah
July 3, 2001

                                       21
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                           Consolidated Balance Sheets

                                     ASSETS

<TABLE>
<CAPTION>
                                                                       March 31,
                                                           ----------------------------
                                                              2001              2000
                                                           -----------      -----------
<S>                                                        <C>              <C>
CURRENT ASSETS

  Cash                                                     $    20,328      $    49,815
  Accounts receivable - net of allowances of $231,217
   and $422,096 in 2001 and 2000, respectively                 615,337          213,268
  Employee advances                                             11,700               --
  Inventory (Note 2)                                           698,379          727,512
  Prepaid expenses                                              20,893           74,170
                                                           -----------      -----------
     Total Current Assets                                    1,366,637        1,064,765
                                                           -----------      -----------
PROPERTY AND EQUIPMENT (Note 3)                              2,229,321        1,148,848
                                                           -----------      -----------
OTHER ASSETS

  Net assets of discontinued operations (Note 14)              752,224          988,312
  Goodwill (Note 21)                                         5,335,881               --
  Notes receivable                                              35,178           50,000
  Movie production cost and product rights (net)             3,664,586        2,649,380
  Refundable deposits                                            3,986           47,159
  Investments                                                   84,000               --
                                                           -----------      -----------
     Total Other Assets                                      9,875,855        3,734,851
                                                           -----------      -----------
     TOTAL ASSETS                                          $13,471,813      $ 5,948,464
                                                           ===========      ===========
</TABLE>

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

                                       22
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                     Consolidated Balance Sheets (Continued)

                 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

<TABLE>
<CAPTION>
                                                                      March 31,
                                                           -------------------------------
                                                               2001              2000
                                                           ------------       ------------
<S>                                                        <C>                <C>
CURRENT LIABILITIES

  Accounts payable                                         $  1,418,541       $  1,089,974
  Short-term obligations (Note 19)                                   --          1,972,502
  Accrued expenses                                            1,694,691            376,391
  Income tax payable (Note 16)                                      500                500
  Accrued interest payable                                      133,176            123,605
  Current portion long-term debt (Note 6)                     2,276,222          3,625,787
  Deferred income                                                93,765                 --
                                                           ------------       ------------
     Total Current Liabilities                                5,616,895          7,188,759
                                                           ------------       ------------
LONG-TERM LIABILITIES

  Long-term debt - related party (Note 5)                     1,187,919                 --
  Long-term debt (Note 6)                                     5,209,222                 --
                                                           ------------       ------------
     Total Long-Term Liabilities                              6,397,141                 --
                                                           ------------       ------------
     Total Liabilities                                       12,014,036          7,188,759
                                                           ------------       ------------
COMMITMENTS AND CONTINGENCIES (Note 10)

STOCKHOLDERS' EQUITY (DEFICIT)

  Common stock, $0.0001 par value, 500,000,000 shares
   authorized, 20,686,292 and 6,781,669 shares
   outstanding at 2001 and 2000, respectively                     2,068                678
  Capital in excess of par                                   57,169,680         36,900,982
  Accumulated deficit                                       (55,713,971)       (38,141,955)
                                                           ------------       ------------
     Total Stockholders' Equity (Deficit)                     1,457,777         (1,240,295)
                                                           ------------       ------------
     TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
       (DEFICIT)                                           $ 13,471,813       $  5,948,464
                                                           ============       ============

</TABLE>

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

                                       23
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                      Consolidated Statements of Operations

<TABLE>
<CAPTION>
                                                             For the Years Ended March 31,
                                                --------------------------------------------------
                                                    2001               2000               1999
                                                ------------       ------------       ------------
<S>                                             <C>                <C>                <C>
REVENUES

  Sales - products                              $    905,070       $    491,779       $    682,760
                                                ------------       ------------       ------------
COST OF SALES

  Product, supplies and materials (Note 2)           525,841            229,315            631,132
                                                ------------       ------------       ------------
GROSS MARGIN                                         379,229            262,464             51,628
                                                ------------       ------------       ------------
EXPENSES

  Bad debt expense                                    58,987             46,180             53,820
  Selling expenses                                   224,661            416,047            851,339
  General and administrative                      15,266,450          4,864,211          3,074,839
                                                ------------       ------------       ------------
     Total Expenses                               15,550,098          5,326,438          3,979,998
                                                ------------       ------------       ------------
OPERATING LOSS                                   (15,170,869)        (5,063,974)        (3,928,370)
                                                ------------       ------------       ------------
OTHER INCOME (EXPENSE)

  Gain on forgiveness of debt                             --             29,375                 --
  Interest income                                     14,442             13,470             11,265
  Interest expense                                  (277,823)          (118,058)           (93,779)
  Gain (loss) on sale of equipment                        --                 --           (160,836)
                                                ------------       ------------       ------------
     Total Other Income (Expense)                   (263,381)           (75,213)          (243,350)
                                                ------------       ------------       ------------
LOSS BEFORE INCOME TAXES                         (15,434,250)        (5,139,187)        (4,171,720)

INCOME TAX PROVISION (Note 17)                           500                500                500
                                                ------------       ------------       ------------
NET LOSS FROM OPERATIONS                         (15,434,750)        (5,138,687)        (4,171,220)

DISCONTINUED OPERATIONS                           (2,137,266)       (13,596,782)           (40,859)
                                                ------------       ------------       ------------
NET LOSS                                        $(17,572,016)      $(18,735,469)      $ (4,212,079)
                                                ============       ============       ============
</TABLE>

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

                                       24
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                      Consolidated Statements of Operations

<TABLE>
<CAPTION>
                                              For the Years Ended March 31,
                                  -------------------------------------------------------
                                       2001               2000                 1999
                                  --------------       -------------       -------------
<S>                               <C>                  <C>                 <C>
BASIC LOSS PER SHARE

   Continued operations           $        (1.31)      $       (0.85)      $       (0.93)
   Discontinued operations                 (0.18)              (2.24)              (0.01)
                                  --------------       -------------       -------------
                                  $        (1.49)      $       (3.09)      $       (0.94)
                                  ==============       =============       =============

FULLY DILUTED LOSS PER SHARE

   Continuing operations          $        (1.31)      $       (0.85)      $       (0.93)
   Discontinued operations                 (0.18)              (2.24)              (0.01)
                                  --------------       -------------       -------------
                                  $        (1.49)      $       (3.09)      $       (0.94)
                                  ==============       =============       =============
WEIGHTED AVERAGE NUMBER OF
 SHARES OUTSTANDING                   11,659,403           6,064,075           4,496,046
                                  ==============       =============       =============
</TABLE>

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

                                       25
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
            Consolidated Statements of Stockholders' Equity (Deficit)
                For the Years Ended March 31, 2001, 2000 and 1999

<TABLE>
<CAPTION>
                                                                                                     Total
                                    Total                       Capital                           Stockholders'
                                    Shares        Common       in Excess       Accumulated           Equity
                                    Issued        Stock         of Par            Deficit           (Deficit)
                                  ----------      ------      -----------      ------------       ------------
<S>                               <C>             <C>         <C>              <C>                <C>
Balance, March 31, 1998            3,522,162      $  352      $18,984,810      $(15,193,407)      $  3,791,755

Shares issued through
 stock offering                    1,521,358         152        3,771,382                --          3,771,534
Shares issued for assets             145,833          15        1,532,985                --          1,533,000
Shares issued for cash                92,950           9            3,709                --              3,718
Correction of an error                12,500           1                4                --                  5
Shares issued in exchange
 for services                        273,703          27           43,420                --             43,447
Shares issued for debt                21,156           2          126,808                --            126,810
Net loss                                  --          --               --        (4,213,079)        (4,213,079)
                                  ----------      ------      -----------      ------------       ------------
Balance, March 31, 1999            5,589,662         558       24,463,118       (19,406,486)         5,057,190

Conversion of debt to stock          646,113          64        3,768,546                --          3,768,610
Stock for services                   415,846          42        3,678,699                --          3,678,741
Stock for cash                        87,501           9            3,491                --              3,500
Options for services                   6,250           1           59,374                --             59,375
Stock for secured interest             5,000           1           80,357                --             80,358
Stock for assets                      31,250           3          320,310                --            320,313
Issuance of options/warrants
  below market value                      --          --        4,527,087                --          4,527,087
Old certificate/new rounding              47          --               --                --                 --
Net loss                                  --          --               --       (18,735,469)       (18,735,469)
                                  ----------      ------      -----------      ------------       ------------
Balance, March 31, 2000            6,781,669         678       36,900,982       (38,141,955)        (1,240,295)

Shares issued for assets             703,250          70        1,826,055                --          1,826,125
Shares issued for cash               788,732          79        2,799,921                --          2,800,000
Shares issued for services         6,078,798         608        6,240,780                --          6,241,388
Shares issued for debt
 conversion                        3,833,743         383        4,039,553                --          4,039,936
Issuance of shares / options
 below market value                       --          --        4,580,139                --          4,580,139
Shares issued for subsidiary       2,500,000         250          782,250                --            782,500
Net loss                                  --          --               --       (17,572,016)       (17,572,016)
                                  ----------      ------      -----------      ------------       ------------
Balance, March 31, 2001           20,686,192      $2,068      $57,169,680      $(55,713,971)      $  1,457,777
                                  ==========      ======      ===========      ============       ============
</TABLE>

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

                                       26
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                      Consolidated Statements of Cash Flows

<TABLE>
<CAPTION>
                                                                          For the Years Ended March 31,
                                                               -------------------------------------------------
                                                                   2001              2000                1999
                                                               ------------       ------------       -----------
<S>                                                            <C>                <C>                <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net loss                                                     $(17,572,016)      $(18,735,469)      $(4,213,079)

  Adjustments to reconcile net loss to net
    cash used by operating activities:

    Amortization                                                    785,622          1,053,376           314,873
    Depreciation                                                    171,900            295,431            79,599
    Loss on sale of assets                                               --                 --           160,836
    Bad debt expense                                                 58,987            368,276            53,820
    Forgiveness of debt                                                  --            (29,375)               --
    Common stock and options issued for services rendered         8,967,025          8,345,561           448,547
    (Increase) decrease in:
    Accounts receivable                                            (461,056)          (383,622)         (227,437)
    Prepaid expenses                                                 53,277            124,179          (187,090)
    Inventory                                                        29,133          2,388,251           275,246
    Note receivable                                                  14,822             60,000          (530,530)
    Refundable deposits                                              43,173            (31,455)           (7,651)
    Investment                                                           --              3,000                --
  Increase (decrease) in:
    Employee advances                                               (11,700)                --                --
    Accounts payable                                                328,567            193,566          (730,202)
    Accrued interest payable                                          9,571              3,871            53,831
    Deferred income                                                  93,765                 --           (54,724)
    Short-term obligations                                               --          1,972,502                --
    Accrued expenses                                              3,829,351            337,719            (4,667)
                                                               ------------       ------------       -----------
      NET CASH USED BY OPERATING ACTIVITIES                      (3,659,579)        (4,034,189)       (4,568,628)
                                                               ------------       ------------       -----------
CASH FLOWS FROM INVESTING ACTIVITIES

  Purchase or development of intangibles                                 --           (230,807)         (128,021)
  Equipment purchases                                              (502,268)          (908,440)         (198,736)
                                                               ------------       ------------       -----------
      NET CASH USED BY INVESTING ACTIVITIES                        (502,268)        (1,139,247)         (326,757)
                                                               ------------       ------------       -----------
CASH FLOWS FROM FINANCING ACTIVITIES

  Issuance of common stock                                        1,612,081              3,500         3,502,167
  Issuance of notes payable                                       1,419,360          3,550,000         3,043,409
  Issuance of common stock - related party                        1,187,919                 --                --
  Payments made on notes payable                                    (87,000)           (62,448)         (138,832)
                                                               ------------       ------------       -----------
      NET CASH PROVIDED BY FINANCING ACTIVITIES                $  4,132,360       $  3,491,052       $ 6,406,744
                                                               ------------       ------------       -----------
</TABLE>

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

                                       27
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                Consolidated Statements of Cash Flows (Continued)

<TABLE>
<CAPTION>
                                            For the Years Ended March 31,
                                     -------------------------------------------
                                       2001             2000             1999
                                     --------       -----------       ----------
<S>                                  <C>            <C>               <C>
NET INCREASE (DECREASE) IN CASH      $(29,487)      $(1,682,384)      $1,511,359

CASH AT BEGINNING OF YEAR              49,815         1,732,199          220,840
                                     --------       -----------       ----------
CASH AT END OF YEAR                  $ 20,328       $    49,815       $1,732,199
                                     ========       ===========       ==========
</TABLE>

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

                                       28
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                   Notes to Consolidated Financial Statements
                             March 31, 2001 and 2000


NOTE 1 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

          The Company's accounting policies reflect practices of the Centric
          graphical software applications, hotel pay-per-view provides hotels
          customers with visual recreational services, the cable television
          channel provides 3D viewing for subscribers and the hardware units
          sells the units required for viewing 3D movies and videos and conform
          to generally accepted accounting principles. The following policies
          are considered to be significant:

          PRINCIPLES OF CONSOLIDATION

          The consolidated financial statements include the accounts of the
          Company and its subsidiaries 3D.COM and VisionComm, Inc. All
          significant intercompany accounts and transactions have been
          eliminated.

          REVENUE RECOGNITION

          Revenue is recognized on an accrual basis upon deliver of the software
          or product, or as customers view pay-per-view items. Revenue consists
          of software sales, product sales, license fees, and monthly hotel
          pay-per-view fees.

          PROPERTY AND EQUIPMENT

          Property and equipment are stated at cost with depreciation and
          amortization computed on the straight line method. Property and
          equipment are depreciated over the following estimated useful lives:

<TABLE>
<CAPTION>
                                                   Years
                                                   -----
<S>                                                <C>
               Office furniture                     5-7
               Machinery and equipment              5-7
</TABLE>

          MOVIE PRODUCTION COST AND PRODUCT RIGHTS

<TABLE>
<CAPTION>
                                                                                         Net Book Value
                                                                                 ---------------------------
                                  Term            Cost          Amortization        2001             2000
                                ---------     -------------     ------------     -----------     -----------
<S>                             <C>           <C>               <C>              <C>             <C>
          Product rights        4-5 years     $ 3,094,045       $ 2,132,143      $   961,902     $ 2,390,351
          Contract/movie
            rights              2-5 years         294,537           294,537               --         259,029
          Production cost         5 years       2,725,725           990,906        1,734,819              --
          Cable production       10 years       1,326,386           358,521          967,865              --
                                              -----------       -----------      -----------     -----------
                                              $ 7,440,693       $ 3,776,107      $ 3,664,586     $ 2,649,380
                                              ===========       ===========      ===========     ===========
</TABLE>

          Product rights have been capitalized and amortized over five years
          using a straight line method. The total amortization expense for the
          years ended March 31, 2001, 2000 and 1999 amounted to $1,748,763,
          $1,053,376, and $314,873, respectively.

                                       29
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                   Notes to Consolidated Financial Statements
                             March 31, 2001 and 2000


NOTE 1 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

          PRODUCT RIGHTS (Continued)

          The Company reviews the recoverability of intangibles whenever events
          or changes in circumstances indicate that the carrying amount of an
          asset may not be recoverable. Several factors are used to evaluate
          intangibles. Including, but not limited to, management's plans for
          future operations, recent operating results and projected,
          undiscounted cash flows.

          BASIC LOSS PER SHARE

          Basic loss per share is calculated using a weighted average for common
          stock.

<TABLE>
<CAPTION>
                                For the Year Ended
                                  March 31, 2001
               --------------------------------------------------
                   Loss                Shares           Per Share
                (Numerator)         (Denominator)        Amount
               ------------         ------------        ---------
<S>                                 <C>                 <C>
               $(17,433,468)         11,659,403         $  (1.49)
               ============          ==========         ========
</TABLE>

<TABLE>
<CAPTION>
                                For the Year Ended
                                  March 31, 2000
               --------------------------------------------------
                   Loss                Shares           Per Share
                (Numerator)         (Denominator)        Amount
               ------------         ------------        ---------
<S>                                 <C>                 <C>
               $(18,735,469)          6,064,075         $  (3.09)
               ============          ==========         ========
</TABLE>

<TABLE>
<CAPTION>
                                For the Year Ended
                                  March 31, 1999
               --------------------------------------------------
                   Loss                Shares           Per Share
                (Numerator)         (Denominator)        Amount
               ------------         ------------        ---------
<S>                                 <C>                 <C>
               $ (4,213,079)          4,496,046         $  (0.94)
               ============          ==========         ========
</TABLE>

          CASH FLOWS

          For purposes of reporting cash flows, cash and cash equivalents
          include cash on hand and cash on deposit with banks.

          INCOME TAXES

          The Company's tax basis is the same as the Company's financial
          statement basis. The Company has net operating loss carryforwards of
          approximately $32,000,000 available to offset future federal and state
          income tax through 2021. The Company has not recorded a tax benefit
          attributable to the carryforwards because realization of such has been
          offset by a valuation allowance for the same amount.

                                       30
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                 Notes to the Consolidated Financial Statements
                             March 31, 2001 and 2000

NOTE 1 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

          PRODUCTION COSTS

          The Company classifies the costs of planing, designing and
          establishing the technological feasibility of computer software
          product as software development costs and charges those costs to
          expense when incurred. Costs incurred for duplicating computer
          software from product masters, documentation and training materials
          and packaging costs are capitalized as inventory and charged to cost
          of sales when revenue is recognized. Costs of maintenance and customer
          support are charged to expense when costs are incurred.

          ADVERTISING

          The Company follows the policy of charging the costs of advertising to
          expense as incurred.

          ESTIMATES

          The preparation of financial statements in conformity with generally
          accepted accounting principles requires management to make estimates
          and assumptions that affect the reported amounts of assets and
          liabilities and disclosure of contingent assets and liabilities at the
          date of the financial statements and the reported amounts of revenues
          and expenses during the reporting period. Actual results could differ
          from those estimates.

          CHANGE IN ACCOUNTING PRINCIPLES

          The Company has adopted the provisions of FASB Statement No. 138
          "Accounting for Certain Derivative Instruments and Hedging Activities,
          (an amendment of FASB Statement No. 133.)" Because the Company had
          adopted the provisions of FASB Statement No. 133, prior to June 15,
          2000, this statement is effective for all fiscal quarters beginning
          after June 15, 2000. The adoption of this principle had no material
          effect on the Company's consolidated financial statements.

          The Company has adopted the provisions of FASB Statement No. 140
          "Accounting for Transfers and Servicing of Financial Assets and
          Extinguishments of Liabilities (a replacement of FASB Statement No.
          125.)" This statement provides accounting and reporting standard for
          transfers and servicing of financial assets and extinguishments of
          liabilities. Those standards are based on consistent application of a
          financial- components approach that focuses on control. Under that
          approach, the transfer of financial assets, the Company recognized the
          financial and servicing assets it controls and the liabilities it has
          incurred, derecognizes financial assets when control has been
          surrendered, and derecognizes liabilities when extinguished. This
          statement provides consistent standards for distinguishing transfers
          of financial assets that are sales from transfers that are secured
          borrowings. This statement is effective for transfers and servicing of
          financial assets and extinguishments of liabilities occurring after
          March 31, 2001. This statement is effective for recognition and
          reclassification of collateral and for disclosures relating to
          securitization transactions and collateral for fiscal years ending
          after December 15, 2000. The adoption of this principle had no
          material effect on the Company's consolidated financial statements.

                                       31
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                 Notes to the Consolidated Financial Statements
                             March 31, 2001 and 2000

NOTE 1 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

          CHANGE IN ACCOUNTING PRINCIPLES (Continued)

          The Company has adopted the provisions of FIN 44 "Accounting for
          Certain Transactions Involving Stock Compensation (an interpretation
          of APB Opinion No. 25.)" This interpretation is effective July 1,
          2000. FIN 44 clarifies the application of Opinion No. 25 for only
          certain issues. It does not address any issues related to the
          application of the fair value method in Statement No. 123. Among other
          issues, FIN 44 clarifies the definition of employee for purposes of
          applying Opinion 25, the criteria for determining whether a plan
          qualifies as a noncompensatory plan, the accounting consequence of
          various modifications to the terms of a previously fixed stock option
          or award, and accounting for an exchange of stock compensation awards
          in a business combination. The adoption of this principle had no
          material effect on the Company's consolidated financial statements.

          PRIOR PERIOD RECLASSIFICATION

          Certain 2000 and 1999 balances have been reclassified to conform to
          the presentation of the 2001 consolidated financial statements.

NOTE 2 -  INVENTORY

<TABLE>
<CAPTION>
                                              March 31,
                                      -------------------------
                                        2001             2000
                                      --------         --------
<S>                                   <C>              <C>
               Finished goods         $698,379         $727,512
               WIP                          --               --
               Raw goods                    --               --
                                      --------         --------
                                      $698,379         $727,512
                                      ========         ========
</TABLE>

          The Company inventories are stated at the lower of cost or market,
          using the first-in, first-out (FIFO) method. Inventories consist
          mainly of components related to the 3-D electronic devices product and
          pay-per-view operations. During the year ended March 31, 2000, the
          Company recognized approximately $2.5 million in markdown of inventory
          attributable to a decision to restructure an activity. The amount is
          recorded in cost of sales.

                                       32
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                   Notes to Consolidated Financial Statements
                             March 31, 2001 and 2000


NOTE 3 -  PROPERTY AND EQUIPMENT

          Property and equipment as of March 31, 2001 and 2000 are detailed in
          the following summary:

<TABLE>
<CAPTION>
                                                                                   Net Book Value
                                                            Accumulated      --------------------------
                                                Cost        Depreciation        2001            2000
                                             ----------     ------------     ----------      ----------
<S>                                          <C>            <C>              <C>             <C>
          Office furniture and fixtures      $  148,815      $   57,078      $   91,737      $  126,894
          Machinery and equipment               982,263         449,000         533,263         949,013
          Hotel pay-per view equipment          470,313         211,641         258,672         352,734
          Telephone and fixtures              2,157,608         831,820       1,325,788              --
          Leasehold improvements                 21,049           1,188          19,861              --
                                             ----------      ----------      ----------      ----------
               Total                         $3,780,048      $1,550,727      $2,229,321      $1,428,641
                                             ==========      ==========      ==========      ==========
</TABLE>

          Depreciation expense is computed principally on the straight line
          method in amounts sufficient to write off the cost of depreciable
          assets over their estimated useful lives. Depreciation expense for the
          years ended March 31, 2001, 2000 and 1999 amounted to $392,128,
          $205,471 and $79,599, respectively.

NOTE 4 -  STOCKHOLDERS' EQUITY

          The Company is authorized to issue 500,000,000 shares of common stock,
          par value $.0001. As of March 31, 2001, the Company has issued
          20,512,631 shares of common stock. On February 2, 2000, the Company
          authorized a 1:4 reverse stock split. The consolidated financial
          statements have been retroactively restated to reflect the reverse
          stock split.

NOTE 5 -  RELATED PARTIES

          Notes payable to related parties as of March 31, 2001 and 2000 are
          detailed in the following summary:

<TABLE>
<CAPTION>
                                                                   2001           2000
                                                                ----------      --------
<S>                                                             <C>             <C>
          Note payable to CEO; with an interest rate of
           10.4%; unsecured; accrued interest of
           $79,943 is due on demand                             $       --      $140,000

          Convertible notes payable to officers and
           directors, with an interest rate of 8%, accrued
           interest of $24,022, due April 30, 2002               1,187,919            --
                                                                ----------      --------
               Total related party notes payable                 1,187,919       140,000

               Less: current portion                                    --      (140,000)
                                                                ----------      --------
               Long-term portion                                $1,187,919      $     --
                                                                ==========      ========
</TABLE>

                                       33
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                   Notes to Consolidated Financial Statements
                             March 31, 2001 and 2000


NOTE 5 -  RELATED PARTIES (Continued)

          Maturities of the related party notes payable are as follows:

<TABLE>
<S>                                               <C>
               Period ending March 31, 2002       $ 1,187,919
                                       2003                --
                                                  -----------
                                      Total       $ 1,187,919
                                                  ===========
</TABLE>

NOTE 6 -  LONG-TERM DEBT

          Notes payable as of March 31, 2001 and 2000 are detailed in the
          following summary:

<TABLE>
<CAPTION>
                                                                        2001           2000
                                                                     ----------      -------
<S>                                                                  <C>             <C>
          Note payable to a company; due in monthly
           installments of $3,244 which includes
           interest at 8%; due on demand, unsecured                  $   49,287      $48,287

          Convertible notes payable to various individuals
           with an interest rate of 8%, accrued interest
           of $32,600 due April 30, 2002                              1,612,081           --

          Notes payable to a Company with monthly payments
           ranging from $450 to $17,931 and quarterly payments
           up to $42,099, with interest rates ranging from 12%
           to 14%, with maturities at various dates through
           January 2007. The notes are secured by equipment           3,081,235           --

          Notes payable to a Company, payable in
           monthly installments of $423 including
           interest at 12.5% through November 2003                       12,365           --

          Note payable to a Company, unsecured,
           payable in weekly installments of $1,521,
           including interest at 12% through October 2001                63,570           --

          Notes payable to a Company, unsecured, payable
           in monthly installments of $2,260 including interest
           at 9% through November 1, 2005                               211,906           --
                                                                     ----------      -------
          Balance Forward                                            $5,030,444      $48,287
                                                                     ----------      -------
</TABLE>

                                       34
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                   Notes to Consolidated Financial Statements
                             March 31, 2001 and 2000


NOTE 6 -  LONG-TERM DEBT (Continued)

<TABLE>
<CAPTION>
                                                                    2001               2000
                                                                 -----------       -----------
<S>                                                              <C>               <C>
          Balance Forward                                        $ 5,030,444       $    48,287

          Note payable to a Company, unsecured, payable
           in monthly installments of interest only,
           calculated at 9% annually, through the due
           date of the principal balance at April 30, 2002         1,260,000                --

          Notes payable to a former stockholders with
           monthly payments of interest only at 10% to
           10.5% annually, through the due date of the
           principal balances at July 2001                           356,000                --

          Promissory notes to various companies;
           April 1, 2001, which includes interest at 12%,
           secured by tangible and intangible assets                      --         3,050,000

          Note payable to an individual, due December
           20, 2001, with interest at 8%                             300,000                --

          Notes payable to various entities, due on
           demand, interest at 8%                                    139,000                --

          Note payable to a company; due on demand,
           interest at 10% due monthly, secured by
           equipment and inventory                                   400,000           440,000

          Note payable to a company; unsecured, due on
           demand, includes interest at 10%                               --            87,500
                                                                 -----------       -----------
               Total long-term debt                                7,485,444         3,625,787

               Less: current portion                              (2,276,222)       (3,625,787)
                                                                 -----------       -----------
               Long-term portion                                 $ 5,209,222       $        --
                                                                 ===========       ===========

</TABLE>


                                       35
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                   Notes to Consolidated Financial Statements
                             March 31, 2001 and 2000


NOTE 6 -  LONG-TERM DEBT (Continued)

          Maturities of long-term debt are summarized below:

<TABLE>
<S>                                                              <C>
               Period ending March 31, 2002                      $ 2,276,222
                                       2003                        3,781,371
                                       2004                          466,176
                                       2005                          359,120
                                       2006 and thereafter           602,555
                                                                 -----------
                                       Total                     $ 7,485,444
                                                                 ===========
</TABLE>

NOTE 7 -  LEASES

          At March 31, 2001, the Company is liable under the terms of
          non-cancelable leases for the following minimum lease commitments:

<TABLE>
<CAPTION>
                                                  Operating
                                                    Leases
                                                  ---------
<S>                                               <C>
          Period ended March 31,
                 2002                             $ 105,000
                 2003                               107,400
                 2004                               107,400
                 2005                               109,800
                 2006                                75,300
                 later years                        129,600
                                                  ---------
          Total minimum lease payments            $ 634,500
                                                  =========
</TABLE>

          Rental expense for the years ended March 31, 2001, 2000 and 1999
          amounted to $421,098, $135,860 and $135,580, respectively.

NOTE 8 -  CASH FLOW AND NON CASH INVESTING AND FINANCING ACTIVITIES

          CASH FLOW INFORMATION

<TABLE>
<CAPTION>
                                             March 31,
                                 ---------------------------------
                                   2001         2000         1999
                                 --------      ------      -------
<S>                              <C>           <C>         <C>
          Interest paid          $268,352      $2,134      $34,535

          Income taxes paid      $    500      $  500      $   500
</TABLE>

                                       36
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                   Notes to Consolidated Financial Statements
                             March 31, 2001 and 2000


NOTE 8 -  CASH FLOW AND NON CASH INVESTING AND FINANCING ACTIVITIES (Continued)

          NON-CASH INVESTING AND FINANCING ACTIVITIES

          For the years ending March 31, 2001, 2000 and 1999, the Company
          incurred the following non-cash investing and financing activities.

<TABLE>
<CAPTION>
                                                                             March 31,
                                                          -------------------------------------------
                                                             2001             2000            1999
                                                          -----------      ----------      ----------
<S>                                                       <C>              <C>             <C>
          Capital lease obligations incurred              $        --      $       --      $   29,895
          Issuance of stock and options for services
           rendered                                       $10,821,527      $8,345,561      $  448,547
          Issuance of stock for assets                    $ 2,800,000      $  510,313      $1,533,000
          Increase in debt for assets                     $        --      $       --      $  440,000
          Issuance of stock for debt                      $ 4,039,936      $3,768,610      $       --
          Issuance of stock for subsidiary                $   782,500      $       --      $       --
</TABLE>

NOTE 9 -  FINANCIAL INSTRUMENTS

          CONCENTRATIONS OF CREDIT RISK

          Financial instruments which potentially subject the Company to
          concentrations of credit risk consist principally of trade
          receivables. The Company provides credit to its customers in the
          normal course of business. However, the Company performs ongoing
          credit evaluations of its customers and maintains allowances for
          potential credit losses. The Company places its temporary cash with
          high quality financial institutions. At times such cash accounts may
          be in excess of the FDIC insurance limit.

NOTE 10 - COMMITMENTS AND CONTINGENCIES

          The Company is a defendant in one pending litigation. On November 14,
          2000, the Company and its Chief Executive Officer, J. Michael Heil
          ("Heil"), were named as defendants in a complaint filed by Trimark
          Pictures, Inc. ("Trimark"). The Trimark complaint alleges that the
          Company and Heil breached the terms of a contract between the Company
          and Trimark dated February 8, 2000, by failing to register a total of
          100,000 shares of the Company's restricted common stock issued to
          Trimark. Trimark claims substantial damages arising from the alleged
          breach of contract and misrepresentations, in the amount of
          $1,650,000.

          The Company is currently engaged in settlement discussions with
          Trimark and have reached a settlement in general terms and are
          awaiting proper documentation resolving the entire matter. In the
          event these discussions are not successful, the Company and Heil
          intend to vigorously defend this case, raising a number of defenses,
          including, among other things, issues regarding the consideration
          received from Trimark; and the actual damages actually suffered by
          Trimark because of the alleged breach of contract.

          In December 2001, the Company entered into five employment agreements
          with certain key personnel. The agreements provided compensation
          arrangements including non-qualified stock options to acquire common
          stock of the Company. The term of the agreements were for thirty-six
          months.

                                       37
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                   Notes to Consolidated Financial Statements
                             March 31, 2001 and 2000


NOTE 11 - ACQUISITIONS

          In August 2000, the Company purchased several film libraries to
          supplement the 3-D TV operations. The film libraries were purchased to
          be converted to a 3-D format. The Company issued 703,250 shares of its
          common stock for the film libraries which are included in its film
          production costs.

NOTE 12 - GOING CONCERN

          The Company's financial statements are prepared using generally
          accepted accounting principles applicable to a going concern which
          contemplates the realization of assets and liquidation of liabilities
          in the normal course of business. The Company has incurred losses from
          its inception through March 31, 2001. The Company does not have an
          established source of revenues sufficient to cover its operating
          costs.

          Management has formulated a plan to raise additional funding through
          stock issuances and increase in debt. In addition, the Company's
          projected revenues from the establishment of its VisionComm
          subsidiary, the expansion of its cable and hotel activities, and the
          completion of its pending private placement with Another World, would
          provide sufficient capital for operations.

NOTE 13 - COMMON STOCK AND WARRANTS

          Effective May 17, 1995, the stockholders approved a 1994 Incentive
          Stock Option Plan granting to key employees options to purchase
          Company common stock over a ten year period, at the fair market value
          at time of grant. The aggregate number of common shares of the Company
          which may be granted under the plan is 800,000 shares. The plan
          expires on March 23, 2004.

          The convertible debentures entered into by the Company carry warrants
          allowing the debtor to acquire stock. The convertible debentures of
          $750,000 are in $250,000 incremental units and carry warrants equal to
          24,753 shares per unit. The convertible debentures of $2,000,000 are
          in $250,000 increments and carry warrants equal to 8,475 shares per
          unit.

          Activity regarding stock options is summarized as follows:

<TABLE>
<CAPTION>
                                                                Number of Shares
                                        -----------------------------------------------------------
                                          2001            Price           2000            Price
                                        ---------      ------------     ---------     -------------
<S>                                     <C>            <C>              <C>           <C>
          Options Granted:
            Beginning of year           2,516,704      $.04 - 28.00       201,987     $        0.04
            Additional granted            784,522       .04 -  2.00     2,314,717      0.04 - 28.00
            Canceled                     (799,037)      .04 - 28.00            --                --
                                        ---------      ------------     ---------     -------------
            End of year                 2,502,189                       2,516,704
                                        =========                       =========
</TABLE>

                                       38
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                   Notes to Consolidated Financial Statements
                             March 31, 2001 and 2000


NOTE 13 - COMMON STOCK AND WARRANTS (Continued)

<TABLE>
<CAPTION>
                                                                Number of Shares
                                        -----------------------------------------------------------
                                          2001            Price           2000            Price
                                        ---------      ------------     ---------     -------------
<S>                                     <C>            <C>              <C>           <C>
          Options Exercised:
            Beginning of year              87,501      $.04 - 28.00        56,251     $        0.04
            Additional exercised          600,000               .04        31,250              0.04
            Expired                            --                --            --                --
                                        ---------      ------------     ---------     -------------
            End of year                   687,501                          87,501
                                        =========                       =========
          Options Outstanding at End
            of Year                     1,814,688                       2,429,203
                                        =========                       =========
</TABLE>

          To retain, attract and compensate key individuals, the Company during
          the fiscal year granted several stock options to various individuals.
          These options are convertible into approximately 2,233,000 shares and
          range from $0.04 to $28.00 per post-split share. In addition, the
          Company granted options for services performed at $8.00 per post-split
          share.

          In December 2000, the Company granted an officer and director options
          to acquire 600,000 shares of common stock from $0.04 to $2.00. In May
          2000, the Company granted options to former employees to acquire
          184,500 shares of common stock at $0.04 per share.

          As part of the VisionComm, Inc. acquisition, the Company issued
          warrants to the sellers to purchase 2,800,000 shares of common stock
          at $1.00 per share. The warrants are immediately exercisable and
          expire in April 2002.

          The Company estimates the fair value of each stock option and warrant
          at the grant date by using the Black-Scholes pricing model. The
          following assumptions were used: risk-free interest rate of 5%, two
          and one-half year expected life, 91 to 120% expected volatility, and
          no expected dividends. Accordingly, the Company recognized
          compensation cost of approximately $4,500,000 associated with these
          options.

NOTE 14 - DISCONTINUED OPERATIONS

          The Company purchased from a financing institution the secured
          interest on a line of credit against Strata, Inc. (Strata). The
          Company continued to advance credit to Strata and as of March 31, 1999
          have recorded a note receivable of $465,530. Also, on March 31, 1999,
          the Company obtained the secure interests of several other promissory
          notes held by several investors against Strata by exchanging stock for
          the notes. The Company exchanged 333,333 shares, at $3.00 per share,
          of common stock for the notes. The above notes hold a secured interest
          in the tangible assets, accounts receivable, intellectual property and
          other assets of Strata. These assets are associated with centric
          graphical software applications. In June 1999, the Company foreclosed
          upon Strata and acquired the collateralized assets of Strata. The
          Company recorded these assets under APB 16 and recognized fixed assets
          of approximately $364,000 and an intangible of approximately $834,000.

                                       39
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                   Notes to Consolidated Financial Statements
                             March 31, 2001 and 2000


NOTE 14 - DISCONTINUED OPERATIONS (Continued)

          In November of 2000, the Company entered into several agreements with
          a Utah corporation to allow the corporation to use the "Strata" assets
          until an agreement could be reached regarding selling the assets or
          combining them with the corporation's assets and merging them into a
          separate entity with the Company obtaining an ownership in the new
          entity. Subsequent to year-end, the Company is still pursuing
          resolving this issue with the Utah corporation. The Company believes
          that the possibility of a new agreement not to be concluded is remote.
          Should a new agreement not be concluded the value of the assets would
          be significantly impaired. Therefore, under FASB 5 the Company feels
          that there is only a remote chance that the uncertainties will give
          rise to a contingency. The total net assets and liabilities were
          $752,224 and $215,146, respectively.

          During the fiscal year, the Company ceased operation of its cable
          channel and 3-D unit segments. The following is a summary of the loss
          from discontinued operations resulting from the elimination of these
          operations. The financial statements have been retroactively restated
          to reflect this event. No tax benefit has been attributed to the
          discontinued operations.

<TABLE>
<CAPTION>
                                                            March 31,
                                                 ------------------------------
                                                    2001               2000
                                                 -----------       ------------
<S>                                              <C>               <C>
          NET SALES                              $   362,446       $    268,478
                                                 -----------       ------------
          OPERATING EXPENSES

            Operating cost                         2,262,891         13,384,554
            Depreciation and amortization            236,821            480,706
                                                 -----------       ------------
              Total Operating Expenses             2,499,712         13,865,260
                                                 -----------       ------------
          LOSS BEFORE INCOME TAXES                (2,137,266)       (13,596,782)

          INCOME TAXES                                    --                 --
                                                 -----------       ------------
          LOSS FROM DISCONTINUED OPERATIONS      $(2,137,266)      $(13,596,782)
                                                 ===========       ============
</TABLE>

NOTE 15 - RELATED PARTY TRANSACTIONS

          The Company pays certain officers and directors royalties from the
          revenue of book sales. In addition, the Company pays a major
          shareholder royalties on active users of the Chequemate product. The
          total amount owing to these individuals as of March 31, 2001 and 2000
          was $-0- and $-0-, respectively.

          The Company has several notes payable to certain members of the Board
          of Directors (see Note 5).

                                       40
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                   Notes to Consolidated Financial Statements
                             March 31, 2001 and 2000


NOTE 16 - PROVISION FOR INCOME TAXES

          The provision for income taxes for the years ended March 31, 2001 and
          2000 consists of the following:

<TABLE>
<CAPTION>
                                          Current      Deferred      Total
                                          -------      --------      -----
<S>                                       <C>          <C>           <C>
          Year ended March 31, 2001
               U.S. Federal                 $ --         $ --         $ --
               State and local               500           --          500
                                            ----         ----         ----
                                            $500         $ --         $500
                                            ====         ====         ====
          Year ended March 31, 2000
               U.S. Federal                 $ --         $ --         $ --
               State and local               500           --          500
                                            ----         ----         ----
                                            $500         $ --         $500
                                            ====         ====         ====
</TABLE>

          Income tax expense was $500 for each of the years ended March 31,
          2001, 2000 and 1999, respectively, and differed from the amounts
          computed by applying the combined U.S. Federal and Utah State income
          tax rate of 38 percent to loss from operations before provision for
          income taxes and extraordinary item as a result of the following:

<TABLE>
<CAPTION>
                                                                       2001              2000
                                                                    -----------       -----------
<S>                                                                 <C>               <C>
          Computed "expected" benefit                               $(6,624,000)      $(7,215,000)
          State tax payable                                                 500               500
          Increase (reduction) in income taxes resulting from:
               Change in valuation allowance for deferred
                 tax assets                                           3,745,274         4,778,892
               Non-deductible expenses                                2,878,726         2,436,108
                                                                    -----------       -----------
                    Income Tax Provision                            $       500       $       500
                                                                    ===========       ===========
</TABLE>

          The tax effects of temporary differences that give rise to significant
          portions of the deferred tax assets at March 31, 2001 and 2000 are
          presented below:

<TABLE>
<S>                                                  <C>                <C>
          Deferred tax assets:
               Net operating loss carryforwards
                    Total deferred tax assets        $ 16,617,048       $ 12,871,774
                    Less valuation allowance          (16,617,048)       (12,871,774)
                                                     ------------       ------------
                    Net Deferred Tax Assets          $         --       $         --
                                                     ============       ============
</TABLE>

                                       41
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                   Notes to Consolidated Financial Statements
                             March 31, 2001 and 2000


NOTE 17 - SUBSEQUENT EVENTS

          On March 15, 2001, the Company entered into a Master agreement as
          amended and restated, and then modified and restated on June 13, 2001,
          which contemplates a private placement to raise up to $3.5 million in
          return for the issuance of approximately 43,125,565 shares to the new
          investors, constituting a 51% equity interest in the Company on a
          fully diluted basis. These newly-issued shares will have registration
          rights customary in such issuances as set forth in the Registration
          Rights Agreements attached to the Proxy Statement filed on June 14,
          2001 in Exhibit 99(a) as Schedule 1.3 to the Master Agreement. Under
          the Master Agreement, the Company can acquire control of Another World
          and its assets at a later date (the "Acquisition") so that they
          Company can benefit from its stereoscopic technologies provided the
          shareholders fo the Company and Another World approve the transaction.
          The Acquisition will be based on an independent valuation of Another
          World. Another World has engaged Samil-PricewaterhouseCoopers to
          perform such independent valuation.

NOTE 18 - SEGMENT INFORMATION

          The Company's reportable segments are strategic business units that
          offer different products and services. They are managed separately
          because each business requires different technology and marketing
          strategies.

          The accounting policies applied to determine the segment information
          are the same as those described in the summary of significant
          accounting policies.

          Financial information with respect to the reportable segments follows:

<TABLE>
<CAPTION>
                                                Centric           Hotel
                                               Graphical      Pay-Per-View       Total
                                              -----------     ------------     -----------
<S>                                           <C>             <C>              <C>
          Revenue from external customer      $   129,805      $  775,265      $   905,070

          Depreciation and amortization         1,111,171       1,029,720        2,140,891

          Operating cost                       12,970,170       1,090,211       20,312,843

          Segment loss                         13,951,536       1,344,666       15,296,202
</TABLE>

NOTE 19 - SHORT TERM OBLIGATIONS

          The Company entered into various agreements and commitments for
          services to be rendered to the Company. These obligation were paid in
          common stock of the Company after approval by the Board of Directors.
          During the year ended March 31, 2001, the Board approved some of the
          agreements and the stock was then issued. The Company recorded the
          obligations as a liability pending the issuance of the stock.

                                       42
<PAGE>

                 CHEQUEMATE INTERNATIONAL, INC. AND SUBSIDIARIES
                               (dba C3-D Digital)
                   Notes to Consolidated Financial Statements
                             March 31, 2001 and 2000


NOTE 20 - BUSINESS COMBINATION

          On December 30, 2000, the Company acquired all of the outstanding
          shares of VisionComm, Inc., a telecommunication and cable television
          provider to multiple dwelling units. The total acquisition cost was
          $7,800,000 which consisted of the issuance of 2,500,000 shares of
          common stock and a note for $2,800,000. The excess of the total
          acquisition cost over the fair value of the net assets acquired of
          $5,335,881 is being amortized over 5 years by the straight-line
          method.

          The acquisition has been accounted for as a purchase and results of
          operations of VisionComm, Inc., since the date of acquisition, are
          included in the consolidated financial statements.

          Unaudited pro forma consolidated results of operations for the years
          ended March 31, 2001 and 2000 as though Vision.Comm had been acquired
          as of April 1, 1999 follow:

<TABLE>
<CAPTION>
                                  2001               2000
                              ------------       ------------
<S>                           <C>                <C>
          Sales               $  3,580,705       $  5,764,558
          Net loss             (18,471,947)       (19,730,923)
          Loss per share             (1.58)             (3.25)
</TABLE>

                                       43
<PAGE>

ITEM 8

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE

In fiscal year ending March 31, 2001 there were no changes in or disagreements
with accountant and financial disclosure.

     PART III

ITEM 9

DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH
SECTION 16(a) OF THE EXCHANGE ACT

Based solely upon our review of forms 3, 4 and 5, and amendments thereto
furnished to us during fiscal year ending March 31, 2001, the following
indivdual were found to be delinquent in complying with Section 16(a) of the
exchange act.

Bob Warfield
John Bartholomew

For each of these persons, we have been unable to determine the exact number
of late reports, the exact number of transactions that were not reported on a
timely basis and the exact number of failures to file the required item per
Section 16(a) of the exchange act.

DIRECTORS

<TABLE>
<CAPTION>
Name and Principal Occupation            Age     First        Shares of Common       Percentage of
or Employment                                    Became a     Stock                  Common stock
                                                 Director     Beneficially Owned     Outstanding
-----------------------------            ---     ----------   ------------------     -------------
<S>                                      <C>     <C>          <C>                    <C>
William J. Brinkmeier                     51     Feb., 2001      1,185,414              4.62%
Vice-President, Chequemate
International, Inc.

Thomas Nix                                53     Feb., 2001        428,315              1.67%
Vice-President, Chequemate,
International, Inc.

Robert E. Warfield                        61     1995              250,000              0.97%
Partner in the real estate
company of Moore Warfield & Glick

Andre Peterson                            48     1998              250,885 (1)          0.98%
VP of Marketing and Chief Marketing
Officer of Cogito Incorporated

John Bartholomew                          42     1998              259,060 (2)          1.01%
General Manager of the Kaizen Group
</TABLE>

                                       44
<PAGE>

<TABLE>
<S>                                      <C>     <C>          <C>                    <C>
Daniel Thompson                           50     1999              125,000 (3)          0.05%

J. Michael Heil *                         46     ?               1,105,000 (3)          4.31%
* Mr Heil resigned as CEO 3/1/01

</TABLE>

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

(1)  This amount includes 30,000 shares available under unexercised options.

(2)  This amount includes 34,285 shares available under unexercised options.

(3)  This amount consists of shares available under unexercised options.

BUSINESS EXPERIENCE

     William J. Brinkmeier. Director. Mr. Brinkmeier is one of the Founders,
President and the Chairman of the Board of VisionComm, Inc. VisionComm, Inc. was
formed by Mr. Brinkmeier, Mr. Rojeski, Mr. Nix and Mr. Wilk in 1995 with the
mission of becoming a leading provider of cable and telecommunication services
to multi-family developments hospitals and hotels. Mr. Brinkmeier is the former
President of Payphones of America, Inc., a nationwide provider of pay telephone
service. Mr. Brinkmeier and Mr. Rojeski founded Payphones of America, Inc. in
1989. From 1989 to 1996, Payphones of America, Inc. increased its' installed
base to over 3300 payphones. In 1996, Mr. Brinkmeier and his partner sold
Payphones of America, Inc. to the largest private provider of pay telephones in
the United States.

     Thomas A. Nix. Director and Chairman of the Board. Mr. Nix is the Executive
Vice President - Cable Division. In this capacity, Mr. Nix is responsible for
all of the Cable Division's sales and marketing activities. Mr. Nix has involved
in the private cable industry for over sixteen years. Mr. Nix was a co-founder
of Datavision in 1982. Datavision was one of the first publicly held companies
to provide security systems for multi-dwelling units. Mr.Nix and his sales team
secured contracts for over 150,000 units. In 1985, Mr. Nix founded Data
Cablevision, which was one of the first providers of private cable television
equipment and services in the United States. As President of Data Cablevision,
Mr. Nix secured private cable contracts for in excess of 22,000 passings. In
addition, he secured contracts to provide pay-per-view and free to guest cable
services to over 16,000 hotel rooms. From 1988 to 1995, Mr. Nix provided
consulting, advisory and brokerage services to the private cable industry. In
addition, Mr. Nix has acquired and operated private cable systems throughout the
United States.

     Robert E. Warfield. Director. Mr. Warfield has a BS Degree in Economics
from Western Maryland College. He has an extensive background in real estate and
regional sales management with the Weyerhaeuser Corporation. Mr. Warfield first
became licensed in real estate in 1962, and in 1975 started Warfield Real
Estate. He has been in the real estate and development business in Ocean City,
Maryland since 1971. For the past 18 years Mr. Warfield has been President of
Moore, Warfield and Glick, Inc., with real estate sales over $100 million and
rentals of $12 million. Additionally, since 1988, Mr. Warfield has been a
regional owner of Help-U-Sell Real Estate in Virginia, Maryland, Washington D.C.
and Delaware. Mr. Warfield currently serves on the Board of Directors of
Atlantic General Hospital and Ocean City Golf and Yacht Club. He has also served
as a director of Second National Service Corp., and Salisbury School.

     Andre Peterson. Director. Mr. Peterson is an alumnus of Brigham Young
University, where he majored in Business Management. He is currently the Vice
President of Marketing and Chief Marketing Officer for Cogito Incorporated, a
software technology development company. He was the VP of Marketing and a
Partner of The Kaizen Group, a marketing and development group for start-up
software from 1996 to 1998. He served as the President of Enhanced Simulation
Marketing from 1994 through 1996, marketing a newly patented motion simulator
for the entertainment industry. He was the VP of Marketing for WordPerfect
Corporation and Novell

                                       45
<PAGE>

Corporation from 1983 to 1994. Mr. Peterson was responsible for all aspects of
sales and marketing for WordPerfect, taking sales from one million in 1983, to
over seven hundred million in 1994. Prior to working for WordPerfect, Mr.
Peterson was a member of the White House Staff for four years.

     John V. Bartholomew. Director. Mr. Bartholomew has a BS degree in Computer
Science from Brigham Young University. He has extensive experience in the
application of technology in computers and complex systems. He has been involved
in the management of technology sales and marketing for more than a decade with
such companies as WordPerfect and Novell. He is the General Manager of The
Kaizen Group, a consulting organization for technology companies with such
customers as Microsoft, NetVision, PowerQuest, LogicalNet and Cogito, a
knowledge based software solutions provider.

     Daniel R. Thompson. Director. Since January of 1984, Mr. Thompson has
served as president of Creative Entertainment Services, a multifaceted
entertainment agency specializing in product placement, promotional advertising,
closed captioning sponsorships, program sponsorships and distribution. He also
serves as an officer of Creative Television Marketing of Los Angeles, California
and as a director of Creative Promotional Marketing of Boston, Massachusetts.

     J. Michael Heil. CEO. Mr. Heil has over 17 years experience in the
satellite and television business. Mr. Heil was formerly president of Skylink
America, Inc. and Satellite Cinema, successfully launching five digital video
pay-per-view networks. During his tenure in these businesses, he developed the
business to $20 million in annual revenue and over 150,000 subscribers. He was
the Director of Operations for Comsat Video Enterprises, and Chairman and CEO of
Television Entertainment Network, Inc., a Canadian hotel pay-per-view company.

COMMITTEES OF THE BOARD OF DIRECTORS

     Robert E. Warfield serves as the sole voting member of the Compensation
Committee of the board of directors. Andre Peterson serves as the Chairman of
the Audit Committee, with John Bartholomew as a member. The Compensation
Committee has been charged with the responsibility of evaluating and
establishing compensation for the management of the Company and the grant of
corporate stock options. The Audit Committee has been charged with the
responsibility of communicating with the auditors of the Company, and evaluating
the accounting controls, functions and systems of the Company.

EXECUTIVE OFFICERS

     The following table outlines the executive officers of the Company.

<TABLE>
<CAPTION>
Name                                  Age     Position Held      Current Term of Office and period of Service
----                                  ---     -------------      --------------------------------------------
<S>                                   <C>     <C>                <C>
J. Michael Heil *                      45     CEO                September 1998 to 3/1/01
* Mr. Heil resigned as CEO 3/1/01

D. Alan Hunter *                       46     Secretary          February 2000 to 10/6/00
* Mr. Hunter resigned as Secretary 10/6/00

Chandos Mahon                          43     President/CEO      March 2001 to present

William J. Brinkmeier                  51     Vice-President     December 2000 to present

Thomas A. Nix                          53     Vice-President     December 2000 to present

Lawrence J. Wilk                       49     Vice-President     December 2000 to present

Frank Friedlein, Jr.                   50     Controller         December 2000 to present
</TABLE>

                                       46
<PAGE>

BUSINESS EXPERIENCE

     Chandos Mahon. President & CEO. Mr. Mahon, born June of 1958, the son of
successful film producer and director Barry Mahon, has over twenty (20) years of
experience in the television, film and telecommunications industries. From
approximately 1997 to 1999, he was the President, Chief Executive Officer, and
principal shareholder, of Programming Services, Inc., a closely-held corporation
founded by Mr. Mahon, which was engaged in satellite programming and satellite
telecommunications. From approximately 1993 to 1998, Mr. Mahon served as the
Executive Vice President and general manager of Network One (N1), a 24 hour
cable and broadcast network. Mr. Mahon was responsible for creation,
implementation and management of the entire business plan. Prior to joining N1,
Mr. Mahon worked in various executive roles with CBS Productions, Columbia
Pictures Television and Imagine Films, where he supervised features and
television production both nationally and internationally. Mr. Mahon has over 20
major production credits to his name. Mr. Mahon provides his management
expertise to all areas of the C-3D plan, including, management, operations,
finance, sales and marketing.

     William J. Brinkmeier. Vice-President. (See business experience above)

     Thomas A. Nix. Vice-President. (See business experience above)

     Lawrence J. Wilk. Vice-President. Mr. Wilk is the Vice President of
VisionComm's cable operations. In this capacity, Mr. Wilk is responsible for all
aspects of VisionComm's cable operations. Mr. Wilk has been involved in the
private cable industry for over sixteen years. Among his many accomplishments,
Mr. Wilk participated in the engineering and implementation of the first digital
compression technology utilized in connection with Viacom's and Scientific
Atlanta's network groups. From 1990 to 1995, Mr. Wilk was Vice President of
Engineering at United Satellite / America, Inc. At USA, Mr. Wilk implemented a
variety of operational restructuring programs encompassing engineering,
maintenance and personnel requirements for the company's 31 cable systems
located throughout the United States. Mr. Wilk increased revenue to USA through
a variety of methods including construction upgrades, renegotiating existing
contractor agreements and utilization of spare parts inventory. From 1993 to
1995, Mr. Wilk was director of Engineering for Telecable Communications Corp., a
privately held company providing cable services to the hospitality industry.

     Frank Friedlein, Jr. Controller. Mr. Friedlein joined VisionComm in July
1998 as its' V.P. / Chief Financial Officer. In this capacity Mr. Friedlein is
responsible for all accounting, budgeting, bank relations and M.I.S. activities.
From 1993 to 1998 Mr. Friedlein was employed by the Vernon L. Goedecke Companies
Group. In 1998 Mr. Friedlein was Vice-President / CFO of the parent Company
Vernon L. Goedecke. 1996 to 1997 Mr. Friedlein was Vice-President / Controller
of New Buffalo Corporation an importer of consumer (Do it Yourself) hand tools.
1993 to 1996 Mr. Friedlein was Manager of Operation for Spirit of St. Louis
Software Company. Mr. Friedlein is a graduate of St. Louis University with a
degree in accounting.

ITEM 10

EXECUTIVE COMPENSATION

     The table set forth below contains information about the remuneration
received and accrued during fiscal years 2000 and 2001 from the Company and its
subsidiaries by the Chief Executive Officer and each of the most highly
compensated executive officers of the Company.

                                       47
<PAGE>

<TABLE>
<CAPTION>
Name and Principal    Fiscal Year     Salary ($)       Bonus ($)     Restricted Stock     Securities
Position                                                                 Award(s)         Underlying
                                                                                            Options
------------------    -----------     ----------       ---------     ----------------     ----------
<S>                   <C>             <C>              <C>           <C>                  <C>
J. Michael Heil          2001         $169,400         $     0           $      0          $      0
CEO and Chairman         2000         $184,800         $     0           $      0          $      0
                         1999         $100,000         $ 6,299           $      0          $      0

D. Alan Hunter           2001         $ 56,500         $      0          $      0          $      0
Secretary                2000         $ 84,000         $      0          $      0          $      0
                         1999         $      0         $      0          $      0          $      0

Chandos Mahon            2001         $      0         $      0          $125,000          $600,000
CEO & President          2000         $      0         $      0          $      0          $      0

William J Brinkmeier     2001         $      0         $      0          $ 33,336          $      0
Vice-President           2000         $      0         $      0          $      0          $      0

Thomas A. Nix            2001         $      0         $      0          $ 33,336          $      0
Vice-President           2000         $      0         $      0          $      0          $      0

Lawrence J. Wilk         2001         $      0         $      0          $ 33,336          $      0
Vice-President           2000         $      0         $      0          $      0          $      0

Frank Friedlein, Jr.     2001         $      0         $      0          $ 30,000          $      0
Controller               2000         $      0         $      0          $      0          $      0
</TABLE>

The following chart shows the stock options that were granted to executive
officers of the Company during the last completed fiscal year.

<TABLE>
<CAPTION>
Name/Position             Total       Percentage of total       Total      Exercise      Expiration
Position                 Options     granted to employees      Options       Price          Date
                         Granted       in fiscal year           Vested     ($/share)
-------------            -------     --------------------      -------     ---------     ----------
<S>                      <C>         <C>                       <C>         <C>           <C>
Chandos Mahon - CEO
  Total                  600,000              100%

Detail
12/01/00                 100,000                                100,000      $0.04       12/31/10
12/01/00                 100,000                                      0      $0.50       12/31/10
12/01/00                 100,000                                      0      $0.50       12/31/10
12/01/00                 100,000                                      0      $0.50       12/31/10
12/01/00                  50,000                                      0      $1.00       12/31/10
12/01/00                  50,000                                      0      $1.00       12/31/10
12/01/00                  50,000                                      0      $2.00       12/31/10
12/01/00                  50,000                                      0      $2.00       12/31/10
</TABLE>

                                       48
<PAGE>

The following table reflects the number of unexercised options that are
exercisable and unexercisable at the end of fiscal year 2001.

<TABLE>
<CAPTION>
Name                       Shares         Value           No. of Securities     Value of unexercised in-
                          Acquired      Realized              Underlying          the-money options at
                         On Exercise       ($)           Unexercised Options           FY-End ($)
                             (#)                            at FY-End (#)        exercisable/unexercisable
                                                       exercisable/unexercisable
---------------          -----------    --------       -----------------------  ------------------------
<S>                      <C>            <C>            <C>                      <C>
J. Michael Heil             125,000     $166,875           150,000 / 0                  $0 / $0
D. Alan Hunter               25,000     $ 33,375                 0 / 0                  $0 / $0
Chandos Mahon               100,000     $ 22,000                 0 / 500,000            $0 / $0
</TABLE>

ITEM 11

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL HOLDERS

The following table sets forth as of June 8, 2001 certain information regarding
the beneficial ownership of the Common Stock of the Company by (a) each person
who is known to the Company to be the beneficial owner of more than 5% of the
outstanding shares of Common Stock, (b) each director of the Company and the
executive officers of the Company and (c) all directors and executive officers
of the Company as a group. Unless otherwise indicated, each beneficial owner
possesses sole voting and dispositive power with respect to the shares listed in
this table.

<TABLE>
<CAPTION>
Name                                Amount and Nature of    Percentage of
                                    Beneficial Ownership        Class
---------------------------         --------------------    -------------
<S>                                 <C>                     <C>
William J. Brinkmeier II(1)               1,185,414             4.62%
Michael J. Heil(2)                        1,105,000             4.31%
Chandos Mahon(3)                            660,857             2.58%
Thomas A. Nix(4)                            428,315             1.67%
Lawrence J. Wilk(5)                         383,066             1.49%
</TABLE>

                                       49
<PAGE>

<TABLE>
<S>                                 <C>                     <C>
Frank Friedlein, Jr(6)                      297,996             1.16%
John V. Bartholomew(7)                      259,060             1.01%
Andre H. Peterson(8)                        250,885             0.98%
Robert E. Warfield(9)                       250,000             0.97%
Daniel Thompson(10)                         125,000             0.05%
Alan Hunter(11)                              25,300             1.01%
Total                                     4,970,893             18.85%
</TABLE>

(1)  Mr. Brinkmeier is a director of the Company. His address is 124 Point West
Blvd., St. Charles, MO 63301.

(2)  Mr. Heil is a director of the Company. His address is 124 Ferry Street SW,
Albany, OR 97321.

(3)  Mr. Mahon is CEO and President of the Company. His beneficial ownership
interest includes 100,000 shares underlying options. His address is: 10336
Variel Ave., Chatsworth, CA 91311.

(4)  Mr. Nix, is a director of the Company and is Chairman of the Board of
Directors. His address is 36380 Garfield Rd So. 7, Clinton Twp, MI, 48035

(5)  Mr. Wilk is an officer of the Company. His address is 36380 Garfield Rd So.
7, Clinton Twp, MI, 48035.

(6)  Mr. Friedlein is the Controller of the Company. His address is 124 Point
West Blvd., St. Charles, MO 63301.

(7)  Mr. Bartholomew is a director of the Company. His beneficial ownership
interest includes 10,000 shares underlying options. His address is 291 E. 950
South, Orem, Utah, 84058.

(8)  Mr. Peterson is a director of the Company. His beneficial ownership
interest includes 6250 shares underlying options. His address is 2091 East 950
South, Orem, Utah, 84058.

(9)  Mr. Warfield is a director of the Company. His address is 5700 Coastal
Highway, Ocean City, MD 21842.

(10) Mr. Thompson is a director of the Company. His beneficial ownership
interest includes 125,000 shares underlying options. His address is 31636 Blue
Meadow Lane, Westlake Village, CA 91361

(11) Mr. Hunter was Secretary of the Company from February 3, 2000 to October 6,
2000. His address is 17221 Palisades Circle, Pacific Palisades, CA 90272.

ITEM 12

CERTAIN RELATED TRANSACTIONS

In November of 2000, the former chairman of the Company entered into a Lease and
License Agreement with Corastar, Inc., a Nevada corporation ("Corastar") on
behalf of the Company, giving Corastar the right to market the Company's 3
dimensional graphic software and the related trade mark "Strata" known as the
Strata Asset. Ken Bringhurst is the President of 3D.COM, Inc., a division of
Chequemate International, Inc. (3D.COM), Gary Bringhurst is a Vice President of
3D.COM and Dennis Derrick is a Vice President of 3D.COM and collectively are
substantial owners of Corastar. The Company is investigating the execution of
the subject agreement to determine if it has been properly approved by the
Company and whether there is conflict of interest involved. Therefore, the
Company cannot attest to the validity of the subject agreement at present. The
Company and Corastar are currently negotiating an arrangement regarding the
Strata assets. However we cannot guarantee whether the negotiation will be
successful.

The Company has no other related transactions to report this year.

                                       50
<PAGE>

ITEM 13

EXHIBITS AND REPORTS ON FORM 8K

EXHIBITS INDEX

<TABLE>
<CAPTION>
EXHIBIT NO.                   DESCRIPTION
-----------                   -----------
<S>            <C>
   3.1         Restated Articles of Incorporation. Incorporated by reference
               from Form 8-A (Film No. 99636119) filed by the Company with the
               Commission on May 27, 1999.

   3.2         By-Laws. Incorporated by reference from Form 8-A (Film No.
               99636119) filed by the Company with the Commission on May 27,
               1999.

   4           Specimen Common Stock Certificate. Incorporated by reference from
               Form 8-A (Film No. 99636119) filed by the Company with the
               Commission on May 27, 1999.

  10.1         SETTLEMENT AGREEMENT NATIONAL FINANCIAL

  10.2         AMENDED SETTLEMENT AGREEMENT BH PRODUCTIONS

  10.3         PROMISSORY NOTE I-O DISPLAY SYSTEMS

  10.4         SETTLEMENT AGREEMENT PROGRAMMING SERVICES, INC.

  10.5         ACADEMY ENTERTAINMENT SETTLEMENT

</TABLE>

                                       51
<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.

                                       CHEQUEMATE INTERNATIONAL, INC.

JULY 6, 2001                           /s/ Chandos Mahon
                                       ----------------------------------
                                       CHANDOS MAHON
                                       PRESIDENT AND CEO



                                       CHEQUEMATE INTERNATIONAL, INC.

JULY 6, 2001                           /s/ Andre Peterson
                                       ----------------------------------
                                       ANDRE PETERSON
                                       DIRECTOR AND PRINCIPAL ACCOUNTING OFFICER

                                       52