FORM 10-KSB - ANNUAL REPORT

(Mark One)
     [x]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
          EXCHANGE ACT OF 1934
                   For the fiscal year ended March 31, 2001

     [ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
          SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]

              For the transition period from        to _____

                     Commission file number  0-18184

                        SK TECHNOLOGIES CORPORATION
              (Name of small business issuer in its charter)

          Delaware                                         52-1507455
(State or other jurisdiction of                          (I.R.S. Employer
incorporation or organization)                         Identification No.)

  500 Fairway Drive, Suite 104, Deerfield Beach, FL           33441
       (Address of principal executive offices)             (Zip Code)

Issuer's telephone number    (954) 418-0101

Securities registered pursuant to Section 12(b) of the Exchange Act:

Title of each class        Name of each exchange on which registered

      None                 _________________________________________

___________________        _________________________________________

Securities registered pursuant to Section 12(g) of the Act:

                                 Common Stock
                               (Title of Class)

     Check whether the issuer (1) filed all reports required to be filed
by Section 13 or 15(d) of the Exchange Act during the past 12 months (or
for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the
past 90 days.  Yes _X_   No ___

     Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B contained in this form, and no disclosure will
be contained in this form, and no disclosure will be contained to the best
of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any other
amendment to this Form 10-KSB. __X__

     State the Issuer's revenues for its most recent fiscal year.

      $477,201

     State the aggregate market value of the voting stock held by non-
affiliates computed by reference to the price at which the stock was sold,
or the average bid and asked prices of such stock, as of a specified date
within 60 days.

     The aggregate market value of the voting stock held by non-affiliates
of the Registrant at June 15, 2001 was $199,337.

     State the number of shares outstanding of each of the issuer's
classes of common equity, as of the latest practicable date.

     As of June 15, 2001, 19,644,494 shares of Common Stock, par  value
$.001 per share, were issued and outstanding.

<PAGE>
                             PART I

ITEM 1.     DESCRIPTION OF BUSINESS:

     SK Technologies Corporation, a publicly-held Delaware
corporation (the "Company") was incorporated in September 1986.
In January 1989 the Company acquired SK Technologies Corp. which
was incorporated under the laws of the State of Florida in March
1985, and the Company changed its name to SK Technologies
Corporation.  Prior to this acquisition, the Company had limited
operations.

BUSINESS OF ISSUER

The Company's Products

     The Company is a developer of retail store management
software for the specialty retail industry.  The Company's
StoreKare product family is a modular system of information
technology products, which offer retailers an affordable,
scalable, feature rich application that runs in both Windows and
DOS environments.  The Company's business strategy is to
continue to enhance our StoreKare product with additional
customer requested modifications and continue the integration of
StoreKare with new Windows products.

     The Company is also developing and marketing application
specific business intelligence solutions that turn existing
enterprise transaction data into business summary and trend
information.  The Company currently markets Loss Prevention MAX
and other business intelligence solutions for  the retail
industry.

     StoreKare

     The StoreKare Retail Management System Version 3.4 operates
with Windows 9X, NT and 2000 as well as PC-DOS and MS-DOS
operating systems on PC platforms.  StoreKare provides a single
screen user interface which guides the user with high-lighted
prompts and pop-up selections.  The Point-Of-Sale module is the
foundation of the StoreKare system and features bar-code
scanning, scale interface, multiple tender types, major credit
and debit card support, discounts, mark-downs and mix and match
pricing.  StoreKare data can be accessed by Windows based
application packages, such as Crystal Report Writer, Microsoft

                               2
<PAGE>
Access and Microsoft Excel, by using the StoreKare Open Data
Base Connectivity Interface module, for Windows.

     Other StoreKare modules available are, Purchasing and
Receiving, Sales and Profit Analysis, Layaways/Work
Orders/Special Orders, Deal Pricing, Dated Discounts, Time and
Attendance, In-House Accounts, Extended Payment Services, Third-
Party Interface, Report Generator and Store Administrator.  The
StoreKare Point-Of-Sale module for two registers currently has a
suggested retail price of $1,195 and the Store Administrator
module for three stores has a suggested retail price of $1,995.
Optional modules, additional workstations, registers and stores
are offered at suggested retail prices ranging from $100 to
$715.

     Business Intelligence Solutions

     Business intelligence solutions can facilitate cost
reduction, customer satisfaction, revenue growth and profit
improvement through a decision process that turns existing data
into information in the context of the business.  With SK's
interactive data mining techniques, users intuitively explore
trends, patterns, comparisons and exceptions using summary data,
then drill down through the summary data to discover where the
business is being impacted and finally drill through to
transaction level details to formulate their business decisions.
This solution and methodology is designed to provide the
information content, quality, completeness and timeliness that
results in high impact business decisions.

     Business applications involving detail transactions
(receipts, orders, invoices, etc.) about goods and services for
money that involve customers, associates or vendors at multiple
locations are candidates for an SK application specific business
intelligence solution.  Businesses with numerous detail
transactions such as retail, insurance, banking, medical and
government are potential customers for SK Technologies.

Business Ventures

     Management believes that aligning the Company with one or
more strategic partners will assist in the marketing of its
StoreKare products.  The Company has entered into formal
agreements and/or business alliances with such major companies
as ScanSource, International Business Machines Corp. ("IBM") and

                             3
<PAGE>
CompuRegister, which management believes will increase the
Company's visibility in the point-of-sale industry and expand
its market share.

     ScanSource

     ScanSource is the principal distributor for the IBM SureOne
and other IBM point-of-sale platforms and provides sales
development services on behalf of IBM, on the SureOne.  The
Company is an authorized independent software vendor ("ISV") and
reseller of the SureOne product and is an invited participant in
all ScanSource sponsored trade shows and lead development
activities.

     IBM

     The Company is an IBM Business Partner.  The Company is
also a participant in the IBM retail solutions program which
provides the Company with access to IBM technical information
and new IBM hardware products prior to their release.  The
Company is a participant in an ongoing IBM lead generation
program.  The leads are distributed to IBM authorized resellers
nationwide, that are partnered with the Company and other
software vendors.

     CompuRegister (A Division of NewBold Corporation)

     In April 1994, the Company entered into a Software Partner
Program with CompuRegister.  Through mailings and other
CompuRegister literature the Company expects that the StoreKare
products will be exposed to expanded markets.

     Loss Prevention Specialists

     In February 1999 the Company entered into an agreement with
Loss Prevention Specialists for consulting services relating to
Loss Prevention MAX and other business intelligence solutions.

Research and Development

     The Company continues to develop enhancements and add-on
features for its existing StoreKare product line and performs
maintenance work when necessary to maintain the high quality of
the product.  The Company also performs customized product
development and product enhancements on a customer funded

                             4
<PAGE>
contract basis for chain store projects and resellers
requirements.

     The Company continues to develop and enhance the Loss
Prevention MAX business intelligence solutions for the retail
industry.

     Research and development costs expensed in fiscal 2001 and
2000 were approximately $28,000 and $27,000, respectively.  The
Company capitalized development costs of approximately $173,000,
and $208,000 during fiscal 2001 and 2000, respectively.

     Typically, development cycles of software products are
lengthy, which results in an extended period of time between the
initiation  of a development project for a product and its
production of revenue.  During the development cycle of our
software products, features of the product are finalized,
specifications are developed, software code and support
documentation are written, and the product  (software and
documentation) is tested in the Company's test lab and then at
selected customer test sites.  Subsequently, the product goes
through the manufacturing process, resellers and the Company's
sales representatives receive product training, and the
marketing process then commences.

Inventory and Hardware

     The Company manufactures its software products on an "as
needed" basis and has never experienced any major difficulty in
its software manufacturing process.  Due to the nature of the
Company's software products, orders are taken for currently
available products and reproduced to satisfy customer's orders.
There is no backlog of orders since all orders are fulfilled as
they are received.

     The Company does not manufacture hardware. The Company
maintains a capital equipment inventory of terminals
manufactured by the major point-of-sale equipment manufacturers
for testing its products.  The Company obtains NCR,
CompuRegister and IBM register products and IBM PCs on a "just
in time" basis for resale to direct customers.

                                 5
<PAGE>
Marketing

     The Company markets its StoreKare products through
resellers of CompuRegister and IBM products.  Resellers handle
specific geographic regions and provide technical expertise and
training to their customers.  The Company requires all resellers
to attend a three day intensive training class  which is offered
to resellers at the Company's offices or at the reseller's
locations.  Additional programs for marketing and technical
support  are offered to resellers.

     The Company has also aligned itself with several major
corporations. Management believes that alliance agreements that
the Company has with such corporations as ScanSource, IBM, and
CompuRegister will assist in the marketing of its products.

Service and Maintenance

     The Company's ability to provide technical support services
to its resellers and users at a high level of quality, quick
response and at reasonable rates is required for the Company to
effectively market its software.

     The Company warrants that the media on which software
programs are sold will be free from defects in materials and
workmanship under normal usage for 30 days from the date of
delivery.  A comprehensive user manual is provided with complete
instructions for operation of the StoreKare system.  The Company
provides 5 day 9 hour telephone support for its software.

Competition

     Management believes that the principal competitive factors
in its market are product performance, functionality and
reliability, price, user friendliness, product availability,
service and support, marketing and promotion.  Management of the
Company believes it competes favorably in all of these areas.
In addition, management believes that, due to the rapid
technological changes and advances in the computer industry
generally, and the segment thereof in which the Company
operates, another major competitive factor in its market is the
ability to achieve technological advances and enhancements
comparable to and competitive with those made by others in such
industry segment.  While the Company believes that it presently
competes favorably in this area, no assurances are given that

                              6
<PAGE>
the Company will be able to adequately respond to product
obsolescence or effect advances in technology in a manner as to
be commercially feasible.  The Company's plan for addressing
this competitive factor is to utilize industry standard personal
computer compatible hardware, and to continue to modify the
Company's products to function on revised and/or replacement
hardware of manufacturers who are viewed as industry leaders and
who command the greatest market share in the point of sale
industry.  Additionally, the Company has estimated a three year
life cycle for each version of a product to be released by the
Company.  The Company's plan also includes developing on-going
upgrades and enhancements (new versions) to its products and
releasing such upgrades and enhancements to the market place on
an ongoing basis.

     Since the Company's strategy is to provide software
products that function on industry standard operating systems
(DOS and Windows), standard hardware (including but not limited
to IBM and CompuRegister manufactured hardware) and operate in a
generic point-of-sale environment, the Company is not dependent
upon any one hardware manufacturer.  However, the Company is
dependent upon certain external applications.  First is the
operating systems (DOS and Windows) which are owned by Microsoft
Corporation ("Microsoft") and sold directly by Microsoft, as
well as, licensed by Microsoft to nearly all hardware
manufacturers of IBM compatible computers.  In view of the
perceived stability of Microsoft, as well as, the license rights
provided to multiple hardware manufacturers, management of the
Company does not view this dependency on Microsoft as a material
factor to the continued success of the Company's products.  Also
the Company is dependent upon the continued distribution and
support of the Faircom Corporation's c-tree database manager, r-
tree report generator and the ODBC drivers.  These products are
embedded in certain StoreKare modules.

     The Company's principal competitors in the point-of-sale
market include, but are not limited to, ARS, CAM Data, Infocorp,
MicroBiz Corp., PSI, RTI, Salepoint, STS, Synchronics and
Virtual Systems.  Some of these competitors do not sell fully
featured point-of-sale systems.  While some of the Company's
competitors have substantially greater financial, personnel and
technological resources than the Company, management believes
that its point-of-sale products have several advantages over
competing products, including distributed communications
capabilities and the support of a wide variety of point-of-sale

                                7
<PAGE>
hardware products from various manufacturers.  Additionally, in
management's opinion the Company's agreements and relationships
with IBM and CompuRegister, as well as its other relationships
give the Company a competitive edge in its market.

Copyrights and Licenses

     The Company has not sought patent protection for its
products but seeks to maintain its proprietary rights by a
combination of copyright and trade secret protection.  The
Company has obtained statutory copyright protection for its
StoreKare software, as well as federal trademark registration
for its SK Technologies and StoreKare names.

Personnel

     The Company currently employs 9 persons as follows:
executive officers (two persons), customer service (one person),
sales and marketing (one person), programming and quality
assurance (three persons), administration and finance (one
person), and operations (one person). The Company also engages
the service of one finance person as needed, on an independent
contractor basis.  The Company retains additional sales,
technical and customer support persons as it deems necessary.

     The Company is not a party to any collective bargaining
agreements and believes it has achieved harmonious employee
relations.


ITEM 2.     DESCRIPTION OF PROPERTY:

     The Company's principal executive offices are located at
500 Fairway Drive, Suite 104, Deerfield Beach, Florida 33441
where the Company occupies 7,029 square feet of office space
which is leased from an unrelated entity, for $10,170 per month
through January 2002, pursuant to a lease which expires January
31, 2002.  This amount includes rent of $6,285 per month and
additional charges for the Company's allocated share of expenses
for 2001.  The expense allocation is adjusted annually.  This
office space is suitable for the Company's current needs.

                                8
<PAGE>
ITEM 3.     LEGAL PROCEEDINGS

     None

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

     None


                                9
<PAGE>
                             PART II

ITEM 5.     MARKET FOR COMMON EQUITY AND RELATED SHAREHOLDER
            MATTERS:

Market Information

     The Company's Common Stock is traded on the OTC Bulletin
Board under the symbol SKTC.  The following table sets forth the
high and low bid quotations for the Common Stock for the periods
indicated.  These quotations reflect prices between resellers
and do not include retail mark-ups, mark-downs or commissions
and may not necessarily represent actual transactions.

                                         Common Stock
                                     High           Low

April 1, 1999 -
 June 30, 1999                     $ 0.28125       $ 0.O3125

July 1, 1999 -
 September 30, 1999                $ 0.1875        $ 0.09375

October 1, 1999 -
 December 31, 1999                 $ 0.25          $ 0.16

January 1, 2000 -
 March 31, 2000                    $ 0.40          $ 0.16

April 1, 2000 -
 June 30, 2000                     $ 0.45          $ 0.13

July 1, 2000 -
 September 30, 2000                $ 0.15          $ 0.09

October 1, 2000
 December 31, 2000                 $ 0.12          $ 0.06

January 1, 2001
 March 31, 2001                    $ 0.09          $ 0.06

April 1, 2001
 June 15, 2001                     $ 0.09          $ 0.03

                                 10
<PAGE>
     On June 15, 2001, the closing bid price on the OTC Bulletin
Board of the Common Stock was $.04.

     As of June 15, 2001, Common Stock was held by approximately
500 shareholders of record.  The Company, however, believes that
the number of beneficial owners of its securities to be in
excess of such number.

     As of the date hereof, the Company has never declared or
paid cash dividends on its Common Stock.  As management of the
Company seeks growth and expansion of the Company's business
through the reinvestment of profits, if any, management does not
anticipate the Company will pay dividends in the foreseeable
future.

                                  11
<PAGE>
ITEM 6.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
            CONDITION AND RESULTS OF OPERATIONS:

General

     The Company is a developer of retail store management
software for the specialty retail industry.  The Company's
StoreKare product family is a modular system of information
technology products, which offers retailers an affordable,
scalable, feature rich application that runs in both Windows and
DOS environments.  The goal of the Company has been to offer
such a product that a retail store owner with limited computer
experience could learn and use without extensive training and
support.  With the advancement of the hardware technology
(computers and cash registers) and extensive reduction in cost,
the small retailer can now afford a complete business management
system.

     The Company is also developing and marketing application
specific business intelligence solutions software using
interactive data mining techniques to explore transaction
trends, patterns, comparisons and exceptions.  The Company
currently markets Loss Prevention MAX business intelligence
solutions for the retail industry.

     Except for historical information contained herein, certain
matters set forth in this Form 10-KSB are forward looking and
involve a number of risks and uncertainties that could cause
future results to differ materially from these statements and
trends.  Such factors include but are not limited to,
significant changes in economic conditions, competition in the
Company's markets, changes in technology and the continued
availability of funding from third parties.

Liquidity and Capital Resources

     The Company had a net loss of $765,650  for the fiscal year
ended March 31, 2001.  During fiscal 2000, the Company had an
extraordinary gain of $5,491,355 from restructuring debt, which
resulted in net income of $4,623,340 for the year then ended.
The debt restructuring was due to two shareholders/directors of
the Company and their related entities converting short term
loans totaling $4,789,500 to Common and Preferred Stock.
Interest on these loans in the amount of $1,234,789 was
forgiven.

                             12
<PAGE>
     The Company's cash decreased from $47,531 at March 31, 2000
to $23,042 at March 31, 2001.  The working capital deficiency
increased from $(906,219) at March 31, 2000 to $(1,330,544) at
March 31, 2001.  The increase in the working capital deficiency
was mainly due to the receipt of loans totaling $430,000 during
fiscal 2001 from one shareholder/director of the Company and the
accrued interest, on the loans from this shareholder/director,
of $8,770 during fiscal 2001.

     During fiscal 2001, one shareholder/director of the Company
provided funding to the Company in the amount of $840,000,
$410,000 for 1,366,667 shares at $.30 per share of Common Stock
and the remaining funds of $430,000 for notes payable on demand
at interest rate of 8% annum.

     As of June 15, 2001, one shareholder/director has provided
funding to the Company in the amount of $145,000 for cash
deficiencies in the fiscal 2002.  There is no guarantee or
commitment that the shareholder/director will provide additional
funding to meet actual cash deficiencies for the remainder of
fiscal 2002.

     At March 31, 2001 and 2000, the Company's capitalized
expenditures for development were $740,673 and $567,859,
respectively; accumulated amortization was $287,246 and $185,956
at March 31, 2001 and 2000, respectively. The Company
capitalized development costs of $172,814 and $208,185 during
fiscal 2001 and 2000, respectively.  The Company anticipates
incurring a comparable amount of development costs for fiscal
2002 as compared to fiscal 2001 as the Company continues its
efforts for Loss Prevention MAX and possibly other business
intelligence solutions.

Results of Operations

     For the years ended March 31, 2001 and 2000, the Company
reported a net loss, before income taxes and extraordinary items
of $765,650 and $868,015.  During fiscal 2000, the Company had
an extraordinary gain of $5,491,355 from restructuring debt,
which resulted in net income of $4,623,340 for the year then
ended.  Revenues from equipment and software sales and support
were $477,201 and $781,137 for fiscal 2001 and 2000,
respectively.

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<PAGE>
     Amortization of software development costs was $101,290 and
$129,976 for fiscal 2001 and 2000, respectively.  In addition,
the Company incurred and expensed, research and development
costs of $28,173 and $26,679 for fiscal 2001 and 2000,
respectively, to maintain and improve the existing versions of
StoreKare products.

     Total selling, general and administrative expenses for
fiscal 2001 decreased about 23% from fiscal 2000.  This decrease
was due to a reduction in payroll and the related reduction in
certain administrative expenses.  The Company anticipates that
total selling, general and administrative expenses will decrease
slightly during fiscal 2002.

     The Company incurred interest expense of $49,432 and
$149,799 during fiscal 2001 and 2000, respectively.  Interest
expense was incurred on loans from shareholders/directors and
their related entities of $8,770 and $113,167 during fiscal 2001
and 2000, respectively.

Seasonality

     The Company believes that seasonality has not historically
had any material impact on its business.  However, during the
winter holiday season, retail businesses typically delay the
installation and/or purchase of any capital assets such as our
StoreKare products.

Inflation

     The Company believes the impact of inflation has
historically been and will continue to be minimal.

                               14
<PAGE>
ITEM 7.     FINANCIAL STATEMENTS

            SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
            INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

                                                          Page


     Report of Independent Certified Public Accountants -
          Berkovits, Lago & Company, LLP                  F-1

     Consolidated Balance Sheet
          March 31, 2001                                  F-2-3

     Consolidated Statements of Operations
          Years Ended March 31, 2001 and 2000             F-4-5

     Consolidated Statements of Capital Deficiency
          Years Ended March 31, 2001 and 2000             F-6

     Consolidated Statements of Cash Flows
          Years Ended March 31, 2001 and 2000             F-7-8

     Notes to Consolidated Financial Statements
          March 31, 2001 and 2000                         F-9-22

                               15
<PAGE>
REPORT OF INDEPENDENT AUDITORS


To the Stockholders and Directors
SK Technologies Corporation and its Subsidiaries

We have audited the accompanying consolidated balance sheet of
SK Technologies Corporation and its Subsidiaries ("the Company")
as of March 31, 2001, and the related consolidated statements of
operations, capital deficiency, and cash flows for each of the
two years in the period ended March 31, 2001.  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
audit.

We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit 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
consolidated financial statement presentation.  We believe that
our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred
to above present fairly, in all material respects, the
consolidated financial position of SK Technologies Corporation
and its Subsidiaries at March 31, 2001, and the consolidated
results of its operations and its cash flows for each of the two
years in the period ended March 31, 2001, in conformity with
generally accepted accounting principles.

The accompanying financial statements have been prepared
assuming that the Company will continue as a going concern.  As
discussed in Note 2 to the financial statements, the Company has
suffered recurring losses from operations and has a net capital
deficiency that raise substantial doubt as to the ability of the
Company to continue as a going concern. Management's plans with
regard to these maters are also described in Note 2. The
financial statements do not include any adjustments that might
result from the outcome of this uncertainty.



Berkovits, Lago & Company, LLP
May 23, 2001

                                F-1
<PAGE>
            SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
                     CONSOLIDATED BALANCE SHEET
                           MARCH 31, 2001

                               ASSETS



Current Assets:
  Cash                                               $   23,042
  Trade accounts receivable, net of
    allowance for doubtful accounts
    of $31,122                                            3,206
  Inventories                                            19,696
                                                     ----------
     Total Current Assets                                45,944

Property and Equipment, Net                              37,938

Other Assets:
  Software development costs, net
    of accumulated amortization
    of $287,246                                         453,427
  Other, net                                             19,811
                                                     ----------
    Total Other Assets                                  473,328
                                                     ----------
                                                     $  557,120
                                                     ==========












                  (Continued on following page.)

                                  F-2
<PAGE>
            SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
                CONSOLIDATED BALANCE SHEET (CONT'D)
                           MARCH 31, 2001


                 LIABILITIES AND CAPITAL DEFICIENCY


Current Liabilities:
  Accounts payable                                   $   24,377
  Accrued expenses                                       88,413
  Due to shareholders/officers/directors                802,070
  Current portion of capital lease obligations            3,921
  Current portion of notes payable to shareholder        12,000
  Loans payable to shareholder/director                 430,000
  Deferred income                                        15,707
                                                     ----------
    Total Current Liabilities                         1,376,488

Notes payable to shareholder, less current portion      364,000

Capital lease obligations, less current portion           4,712

Capital Deficiency:
  Preferred Stock, $.001 par
    value, 5,000,000 shares authorized:
      1,000,000 shares designated as
        convertible Series B Preferred Stock,
        396,066 shares issued and
        outstanding                                         396
      3,000 shares designated as Series D
        Preferred Stock, 793 shares issued
        and outstanding                                       1
  Common Stock, $.001 par value, 25,000,000
    shares authorized, 19,644,494 shares
    issued and outstanding                               19,644
  Additional paid-in capital                         13,840,737
  Accumulated deficit                               (15,048,858)
                                                     ----------
    Capital Deficiency                               (1,188,080)
                                                     ----------
                                                     $  557,120
                                                     ==========


  The accompanying notes are an integral part of the financial
  statements.

                              F-3
<PAGE>
               SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
                   CONSOLIDATED STATEMENTS OF OPERATIONS
                    YEARS ENDED MARCH 31, 2001 AND 2000

                                                  2001              2000

Revenues:
  Equipment, software sales and
    support                                 $   477,201       $   781,137

Cost of Revenues:
  Cost of equipment sold                         73,211            68,940
  Amortization of software
    development costs                           101,290           129,976
  Research and development expense               28,173            26,679
                                            -----------       -----------
                                                202,674           225,595
                                            -----------       -----------
                                                274,527           555,542
Selling, General and Administrative
Expenses:
  Compensation and payroll taxes                708,350           920,459
  Other selling, general and
    administrative expenses                     282,894           366,976
                                            -----------       -----------
                                                991,244         1,287,435
                                            -----------       -----------
Operating Loss                                 (716,717)         (731,893)

Other (Expenses) Income:
  Gross profit on installment sale                    -            16,045
  Interest expense                              (49,432)         (149,799)
  Other, net                                        499            (2,368)
                                            -----------       -----------
    Total Other Expenses                        (48,933)         (136,122)
                                            -----------       -----------
Loss Before Income Taxes and
  Extraordinary Item                           (765,650)         (868,015)

Income tax benefit                                    -           347,206
                                            -----------       -----------
Loss Before Extraordinary Item                 (765,650)         (520,809)



                       (Continued on following page)

                                    F-4
<PAGE>
               SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
              CONSOLIDATED STATEMENTS OF OPERATIONS (CONT'D)
                    YEARS ENDED MARCH 31, 2001 AND 2000

                                                2001              2000

Extraordinary Item: Gain from
  restructuring of debt (net of
  income taxes of $2,196,542)                 $       -        $3,294,813

Benefit from utilization of net
  operating loss carryforwards                        -         1,849,336
                                             ----------        ----------
Net (Loss) Income                             $(765,650)       $4,623,340
                                             ==========        ==========
Basic (Loss) Earnings Per
  Common Share
    Loss before extraordinary item           $     (.04)       $     (.04)
    Extraordinary income (net, plus
      tax benefit)                                    -               .37
                                             ----------        ----------
  Net (Loss) Income Per Common
    Share                                    $     (.04)       $      .33
                                             ==========        ==========

Diluted (Loss) Earnings Per
  Common Share
    Loss before extraordinary item           $     (.04)       $     (.04)
    Extraordinary income (net, plus
      tax benefit)                                    -               .37
                                             ----------        ----------
Net (Loss) Income Per Common
  Share                                      $     (.04)       $      .33
                                             ==========        ==========
Weighted Average Number of
  Common Shares Outstanding                  19,164,676        13,775,054
                                             ==========        ==========








The accompanying notes are an integral part of the financial statements.

                                   F-5
<PAGE>
               SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
              CONSOLIDATED STATEMENTS OF CAPITAL DEFICIENCY
                   YEARS ENDED MARCH 31, 2001 AND 2000

                         Series D        Series B
                     Preferred Stock  Preferred Stock      Common Stock
                     Shares  Amount   Shares   Amount    Shares    Amount
Balance at
  March 31, 1999          -    $  -   454,399    $454   6,357,828   $6,358

Conversion of
  Preferred Stock
  to Common Stock         -       -   (58,333)    (58)     58,333       58

Issuance of Series
  D Preferred Stock
  pursuant to
  conversion of loans
  from shareholders/
  directors             793       1         -       -           -        -

Issuance of Common
  Stock pursuant to
  conversion of loans
  from shareholders/
  directors               -       -         -       -   6,661,666    6,662

Issuance of
  Common Stock            -       -         -       -   5,200,000    5,200

Net income - Includes
  extraordinary gain of
  $5,491,355 from
  conversion of loans
  to Preferred and
  Common Stock and
  forgiveness of debt     -       -         -       -           -        -
                       ____    ____   _______    ____  __________  _______
Balance at
  March 31, 2000        793       1   396,066     396  18,277,827   18,278

Issuance of
  Common Stock            -       -         -       -   1,366,667    1,366

Net loss                  -       -         -       -           -        -
                       ____    ____   _______    ____  __________  _______
Balance at
  March 31, 2001        793    $  1   396,066    $396  19,644,494  $19,644
                       ====    ====   =======    ====  ==========  =======




                           Additional
                            Paid-In         Accumulated        Capital
                            Capital           Deficit         Deficiency
Balance at
  March 31, 1999          $12,117,031      $(18,906,548)     $(6,782,705)

Conversion of
  Preferred Stock
  to Common Stock                   -                 -                -

Issuance of Series
  D Preferred Stock
  pursuant to
  conversion of loans
  from shareholders/
  directors                         -                 -                1

Issuance of Common
  Stock pursuant to
  conversion of loans
  from shareholders/
  directors                   526,272                 -          532,934

Issuance of
  Common Stock                788,800                 -          794,000

Net income - Includes
  extraordinary gains of
  $5,491,355 from
  conversion of loans
  to Preferred and
  Common Stock and
  forgiveness of debt               -         4,623,340        4,623,340
                          ___________      _____________     ____________
Balance at
  March 31, 2000           13,432,103       (14,283,208)        (832,430)

Issuance of
  Common Stock                408,634                 -          410,000

Net loss                            -          (765,650)        (765,650)
                          ___________      _____________     ____________
Balance at
  March 31, 2001          $13,840,737      $(15,048,858)     $(1,188,080)
                          ===========      =============     ============



The accompanying notes are an integral part of the financial statements.

                                   F-6
<PAGE>
                SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                     YEARS ENDED MARCH 31, 2001 AND 2000

                                                    2001           2000
Cash Flows From Operating Activities:
  Net (loss) income                               $(765,650)   $4,623,340
  Adjustments to reconcile net (loss) income to
    net cash used in operating activities:
      Extraordinary gain                                  -    (5,491,355)
      Depreciation                                   22,379        26,052
      Amortization                                  101,290       129,976
      Disposal of fixed assets                          318         6,707
  Changes in operating assets and liabilities:
      Trade accounts receivable                       5,061        (2,202)
      Inventories                                     1,831         3,873
      Installment accounts receivable                     -        20,000
      Accounts payable                               (4,029)      (16,171)
      Accrued expenses                              (15,447)        1,606
      Due to shareholders/directors                   8,670       107,226
      Deferred income                               (20,462)        3,808
      Deferred gross profit on installment sale           -       (16,045)
                                                   ---------     ---------
        Net cash (used in) operating activities    (666,039)     (603,185)

Cash Flows From Investing Activities:
  Purchases of property and equipment                (2,458)       (7,622)
  Additions to software development costs          (172,814)     (208,186)
  Net decrease (increase) in other assets               529          (116)
                                                   ---------     ---------
    Net cash (used in) investing activities        (174,743)     (215,924)

Cash Flows from Financing Activities:
  Proceeds from loans from shareholders/directors   430,000        66,000
  Principal payments on capital lease obligations   (11,707)      (10,548)
  Principal payments on note payable to shareholder (12,000)      (12,000)
  Proceeds from issuance of Common Stock            410,000       794,000
                                                    --------      --------
      Net cash provided by financing activities     816,293       837,452
                                                    -------       --------
      (Decrease) increase in cash                   (24,489)       18,343

Cash at beginning of year                            47,531        29,188
                                                    --------      --------
Cash at end of year                                  23,042       $47,531
                                                    ========      ========
Supplemental disclosure of cash flow information:
  Cash paid for interest                            $40,762       $42,572
                                                    ========      ========
                     (Continued on following page.)

                                   F-7
<PAGE>
           SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
           CONSOLIDATED STATEMENT OF CASH FLOWS (CONT'D)
               YEARS ENDED MARCH 31, 2001 AND 2000


Supplemental Schedule of Non-Cash Investing and Financing
Activities

     During fiscal 2001 and 2000, the Company entered into
capitalized lease obligations amounting to $0 and $21,454
respectively.
















  The accompanying notes are an integral part of the financial
  Statements.

                                F-8
<PAGE>
           SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      MARCH 31, 2001 AND 2000

NOTE 1 -   BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT
           ACCOUNTING POLICIES

Basis of Presentation

     SK Technologies Corporation (the "Parent"), and its wholly
owned subsidiaries (collectively "the Company"), is engaged in
developing and marketing retail store management software for
the specialty retail industry.  The Company's StoreKare product
family is a modular system of information technology products.
The Company is also developing and marketing application
specific business intelligence solutions software using
interactive data mining techniques to explore trends, patterns,
comparisons and exceptions.  The Company currently markets Loss
Prevention MAX and other business intelligence solutions for the
retail industry.

Principles of Consolidation

     The consolidated financial statements include the accounts
of SK Technologies Corporation and its two wholly-owned
subsidiaries, SK Technologies Corp. and SK Credit Corporation.
All significant intercompany transactions and balances have been
eliminated in consolidation.

Revenues and Expense Recognition

     In accordance with Statement of Position 97-2, "Software
Revenue Recognition" ("SOP  97-2"), the Company recognizes
revenue from software sales upon delivery, when the fees are
fixed and determinable and collectibility of the proceeds is
probable.  For arrangements with multiple elements, revenues are
allocated to the various elements based on the separate prices
as stated in the contract.  Revenue is recognized for each
element when the above requirements for revenue recognition
exist.  Equipment sales revenue is recognized upon shipment.

     Additionally, the Company performs various enhancements to
their basic software, which are retained by the Company, for
which they receive compensation from unrelated parties.  Such
revenues and costs are recorded using the percentage of
completion method.

                                 F-9
<PAGE>
           SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      MARCH 31, 2001 AND 2000

     Maintenance and support revenues are recognized ratably
over the term of the contract.

Cash and Cash Equivalents

     The Company considers all highly liquid investments with a
maturity of three months or less at the date of acquisition to
be cash equivalents.  The concentration of credit risk
associated with cash and cash equivalents is considered low due
to the credit quality of the issuers of the financial
instruments.

Trade Accounts Receivable

     Trade accounts receivable are primarily from direct sales
to retail stores and store chains.  The Company performs ongoing
evaluations of its significant customers and generally does not
require collateral.  The Company maintains an allowance for
doubtful accounts at a level which management believes is
sufficient to cover potential credit losses.

Inventories

     Inventories consist of component parts and support
materials used in the delivery of Company designed computer
systems.  Inventories are stated at the lower of cost (first-in,
first-out) or market.

Property and Equipment

     Property and equipment are recorded at cost and depreciated
using the straight-line method over their estimated useful
lives.

Long-Lived Assets

     Management periodically evaluates the Company's property
and equipment to determine if there has been any impairment
other-than-temporary in the carrying value of the assets.  In
March 1995, the Financial Accounting Standards Board issued
Statement No. 121, "Accounting for the Impairment of Long-Lived

                              F-10
<PAGE>
           SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      MARCH 31, 2001 AND 2000

Assets and for Long-Lived Assets to Be Disposed of" ("Statement
121"), which requires impairment losses to be recorded on long-
lived assets used in operations when indicators of impairment
are present and the undiscounted cash flows estimated to be
generated by those assets are less than the assets' carrying
amount.  Statement 121 also addresses the accounting for long-
lived assets that are expected to be disposed of.

Software Development Costs

     In accordance with Statement of Financial Accounting
Standards ("SFAS") No. 86, "Accounting for Costs of Computer
Software to be Sold, Leased or Otherwise Marketed," all direct
software production costs  incurred to generate Production
Masters after technological feasibility has been established are
capitalized and subsequently amortized over the estimated
product life cycles.  Prior to technological feasibility,
software development costs are charged to operations as
incurred.

     The amortization of capitalized computer software costs
commences when the Company's software development reaches a
point where its technology is economically feasible for
effective market distribution of the developed product.

Deferred Income and Revenue Recognition

     Deferred income consists of $15,707 from support contracts
to be recognized ratably over the terms of the contracts.

Use of Estimates

     The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the amounts reported
in  the consolidated financial statements and accompanying
notes.  Actual results could differ from those estimates.

                            F-11
<PAGE>
           SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      MARCH 31, 2001 AND 2000

Advertising Costs

     The Company expenses all advertising costs as incurred.


Earnings (Loss) Per Common Share

     In 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 128, Earnings
per Share.  Statement 128 replaced the previously reported
primary and fully diluted earnings per share with basic and
diluted earnings per share.  Unlike primary earnings per share,
basic earnings per share excludes any dilutive effects of
options, warrants, and convertible securities.  Diluted earnings
per share is very similar to the previously reported fully
diluted earnings per share.  All earnings per share amounts for
all periods presented were restated to conform to the Statement
128 requirements.  Basic and diluted earnings (loss) per Common
Share is calculated by dividing net income (loss) by the
weighted average Common Shares outstanding.  The exercise of
options and warrants or conversion of convertible securities
have been excluded from the calculation of diluted earnings
(loss) per share since the Company has a loss from continuing
operations and the effect of these potential shares on loss per
Common Share is anti-dilutive.

Accounting for Stock-Based Compensation

     In October 1995, the FASB issued SFAS No. 123, "Accounting
for Stock-Based Compensation," the adoption of which was
required for fiscal years beginning after December 15, 1995.
The new standard encourages companies to use the fair value
method of accounting for issuance of stock options and other
equity instruments.  Under the fair value method, compensation
cost is measured at the grant date based on the fair value of
the award and is recognized over the service period, which is
usually the vesting period.  Pursuant to SFAS No. 123, companies
are also permitted to continue to account for such transactions
under Accounting Principles Board ("APB") Opinion No. 25,
"Accounting for Stock Issued to Employees," but are required to
disclose in a note to the financial statements pro forma net
income and per share amounts as if the Company had applied the

                             F-12
<PAGE>
           SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      MARCH 31, 2001 AND 2000

new method of accounting.  Additionally, SFAS No. 123 requires
increased disclosure for stock-based compensation arrangements
regardless of the method chosen to measure and recognize
compensation for employee stock-based arrangements.

     The Company currently accounts for such transactions under
APB Opinion No. 25 and has elected not to change its method of
accounting for the issuance of stock options and other equity
instruments to the fair value method.

Income Taxes

     Deferred tax assets and liabilities are determined based on
differences between financial reporting and tax basis of assets
and liabilities and are measured using the enacted tax rates and
laws that will be in effect when the differences are expected to
reverse.

NOTE 2 -   GOING CONCERN CONSIDERATION

     The Company had a net loss of $765,650 for the fiscal year
ended March 31, 2001 and has a net capital deficiency of
$1,188,080 as of March 31, 2001.  The Company has experienced
losses from operations in the past and continues to experience
losses. Based on these conditions, doubt exists about the
ability of the Company to continue as a going concern.

     The financial statements for the year ended March 31, 2001
do not include adjustments relating to the recoverability and
classification of the recorded carrying value of the assets or
the amounts or classification of liabilities that might be
necessary should the Company be unable to continue as a going
concern.

     During fiscal 2001 a majority shareholder/director provided
funding to the Company in the amount of $840,000 based on the
Company's cash deficiencies from operations.  As of June 15,
2001, one shareholder/director has provided funding to the
Company in the amount of $145,000 for cash deficiencies in the
fiscal 2002.  There is no guarantee or commitment that the
shareholder/director will provide additional funding to meet
actual cash deficiencies for the remainder of fiscal 2002.

                             F-13
<PAGE>
           SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      MARCH 31, 2001 AND 2000

NOTE 3 -   PROPERTY AND EQUIPMENT

     At March 31, 2001 property and equipment consists of the
following:

                                                       Useful
                                                    Life (years)
Furniture and equipment                $206,046         5-10
Leasehold improvements                    3,669            5
                                     ----------
                                        209,715
Less accumulated depreciation
  and amortization                     (171,777)
                                     ----------
                                       $ 37,938
                                     ==========

     During fiscal 2001, the Company did not enter into any
capitalized lease obligations.  Included in furniture and
equipment at March 31, 2001 is $13,109 under capital leases,
which is net of accumulated amortization of $5,618.

     The Company leases 7,029 square feet of office space from
an unrelated entity for $10,170 per month through January 2002,
pursuant to a lease which expires January 31, 2002.  This amount
includes rent of $6,285 per month.  The expense allocation is
adjusted annually.  Rental expenses were $119,180 and $113,922
in fiscal 2001 and 2000, respectively.

     Future minimum lease payments under noncancellable
operating leases at March 31, 2001  are as follows:

          Fiscal Year    Minimum Payment

            2002            $ 108,946
                            =========




                                F-14
<PAGE>
           SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      MARCH 31, 2001 AND 2000

NOTE 4 -   SOFTWARE DEVELOPMENT COSTS

     The Company released version 3.4 of its retail product,
during the third quarter of fiscal 2000 and continues to develop
its business intelligence applications.

     The Company capitalized approximately $173,000, and
$208,000 of software development costs during fiscal 2001 and
2000, respectively.

     Amortization of StoreKare software development costs was
approximately $101,000 and $130,000 during fiscal 2001 and 2000,
respectively.

NOTE 5 -   CAPITALIZED LEASE OBLIGATIONS

     Certain equipment is leased under capital lease agreements
expiring through fiscal 2004 and are included in furniture and
equipment.  Future minimum commitments by year under
noncancellable capital leases at March 31, 2001 are as follows:

                          Year Ended
                           March 31                 Amount

                              2002                   4,884
                              2003                   4,704
                              2004                   1,176
                                                    ------
          Total minimum lease payments              10,764

          Less: Amount representing
            interest (12%)                          (2,131)
                                                    ------
          Present value of net minimum
            lease payments                           8,633
          Less: current portion                      3,921
                                                    ------
          Long-term portion of capital
            lease obligations                     $  4,712
                                                    ======


                               F-15
<PAGE>
           SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      MARCH 31, 2001 AND 2000

NOTE 6 -   CAPITAL DEFICIENCY

Common Stock

     During fiscal 2001 one shareholder/director of the Company
provided funding to the Company in the amount of $840,000,
$410,000, for 1,366,667 shares at $.30 per share of Common Stock
and the remaining funds of $430,000 for notes payable on demand
at interest rate of 8% annum.

     The number of shares of Common Stock reserved for future
issuance at March 31, 2001 is summarized as follows:

                                       2001

Common Stock Purchase Warrants        490,073
Stock Options                       3,775,000
Convertible Preferred Stock           399,066
                                    ---------
                                    4,664,139
                                    =========

     At March 31, 2001 there were 490,073 private warrants
outstanding, which were issued pursuant to a private offering in
1993.  Such warrants are convertible into 490,073 shares of
Common Stock at a conversion price of $1.00 per share and were
extended to expire in March 2002.

NOTE 7 -   RELATED PARTY TRANSACTIONS

     Pursuant to a May 1993 agreement between the Company and
Fundamental Management Corp. ("Fundamental"), a fee of $25,000
was approved to be paid in installments  to  Fundamental  based
on  the  amount  of  proceeds  received from  the  1993
Preferred  Stock  offering.  The  first  installment  of  $8,333
was paid in May 1993 and $16,667 is included in accounts payable
due to shareholders/officers/directors, at March 31, 2001.

     Pursuant to a May 1993 Consulting agreement between the
Company and Capital Hill Group Inc. ("CHG"), the Company
incurred consulting fees to CHG of $5,550 per month, for a total
of $236,500 through December 1996 when the agreement terminated.

                               F-16
<PAGE>
           SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      MARCH 31, 2001 AND 2000

Of this amount $225,500 has been accrued to date and is included
in accounts payable due to shareholders/officers/directors at
March 31, 2001.

     In connection with the Finder's agreement between the
Company and CHG the Company accrued finders fees of $493,000
through December 1996 which is included in accounts payable due
to shareholders/officers/directors at March 31, 2001.

NOTE 8 -   INCOME TAXES

     For the year ended March 31, 2001 no provision or (credit)
for income taxes has been provided for in the accompanying
consolidated financial statements because realization of such
income tax benefits cannot be reasonably assured.  The Company
will recognize the benefit from such carryforward losses in the
future, if and when they are realized, in accordance with
applicable provisions of accounting principles for income taxes.

     At March 31, 2001 the Company has net operating loss
carryforwards of approximately $14 million that can be used to
offset future taxable income, that expire in the years 2007
through 2021.  In fiscal 1995, the Company had ownership changes
as defined under Internal Revenue Code Section 382 (Section
382).  As such, the availability to utilize the net operating
losses that existed as of this ownership change is limited.

NOTE 9 -    STOCK OPTIONS

1990 Company Stock Option Plan

     On April 3, 1990, the Company adopted a Stock Option Plan
(the "1990 Option Plan") for its directors and employees, which
provides for the grant of options to purchase an aggregate
50,000 shares of the Company's Common Stock.  Of this amount,
45,000 shares may be granted as incentive stock options
("ISOs").

     The 1990 Option Plan is intended to qualify as an
"Incentive Stock Option Plan" under Section 422A of the Internal
Revenue Code.  Under the 1990 Option Plan, ISOs may be granted
at not less than 100 percent of the fair market value of the

                             F-17
<PAGE>
           SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      MARCH 31, 2001 AND 2000

Company's Common Stock as determined by the Board of Directors
on the date of grant (110% of fair market value for 10% or
greater shareholder) and options granted to any one participant
may not exceed $100,000 in aggregate fair market value
(determined at the time the option is granted), per year.
Options must be granted within ten (10) years from the adoption
of the 1990 Option Plan and exercised within ten (10) years from
the date of grant.

     As of March 31, 2001, there were 1,600 options outstanding
pursuant to the 1990 Option Plan which were exercisable at
$30.00 per share.

1995 Company Stock Option Plan

     In November 1995, the Company adopted the 1995 Option Plan,
reserving 1,400,000 shares of Common Stock which may be
purchased pursuant to the exercise of options granted under this
plan.  This plan was amended in June 1999, as approved by the
Board of Directors and a majority vote of the shareholders of
the Company, to increase the number of shares which may be
purchased pursuant to the exercise of options granted under this
plan to 3,700,000.

     The 1995 Option Plan is also intended to qualify as an
"Incentive Stock Option Plan" under Section 422A of the Internal
Revenue Code.  Under the 1995 Option Plan, ISOs may be granted
at not less than 100 percent of the fair market value of the
Company's Common Stock as determined by the Board of Directors
on the date of grant (110% of fair market value for 10% or
greater shareholders) and options granted to any one participant
may not exceed $100,000 in aggregate fair market value
(determined at the time the ISO is granted), per year.  Options
must be granted within ten (10) years from the adoption of the
1995 Option Plan and exercised within five (5) years from the
date of grant.  The options issued pursuant to the 1995 Option
Plan may be ISOs, options which are not ISOs ("NSOs"), or reload
options, (as defined).  On October 31, 1996 the 1995 Option Plan
was approved by a majority of the shareholders of the Company.
In July 1997 and February 2000, the Company filed registration
statements on Form S-8, with the Securities Exchange Commission,
to register 1,400,000 and 2,300,000 shares of Common Stock which

                            F-18
<PAGE>
           SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      MARCH 31, 2001 AND 2000

may be purchased pursuant to the exercise of options under the
1995 Option Plan.  As of March 31, 2001, 1,747,500 options
granted pursuant to this plan are ISOs and 200,000 options
granted pursuant to the plan are NSOs.

     During fiscal 2001 and 2000 options for 0 and 201,500
shares of Common Stock were granted to employees and 0 and
1,240,000 were issued to officers and directors, respectively.
Such options are exercisable at $.32 per share and expire
through January 2005, five years from the date of grant.  As of
March 31, 2001, there are options for 1,947,500 shares of Common
Stock outstanding of which 1,236,504 are exercisable.

Other Stock Options

     As of March 31, 2001 other stock options of 25,000 were
outstanding.  Such options expire through 2002.  As of March 31,
2001, 25,000 of the other stock options are fully vested.

Stock Based Compensation

     As required by Statement No. 123, pro forma information
regarding net loss and loss per share has been determined as if
the Company had accounted for its employee stock options under
the fair value method of that statement.  The fair value for
these options was estimated at the date of grant using a Black-
Scholes option pricing model with the following weighted-average
assumptions for 2002; risk-free rate of return of 5.00%;
dividend yield of 0.000%; volatility factor of the expected
market price of the Company's Common Stock of 1.39% and a
weighted-average expected life of the options of two to five
years.

     The Black-Scholes option valuation model was developed for
use in estimating the fair value of traded options that have no
vesting restrictions and are fully transferable.  In addition,
option valuation models require the input of highly subjective
assumptions including the expected stock price volatility.
Because the Company's stock options have characteristics
significantly different from traded options, and because changes
in the subjective input assumptions can materially affect the
fair value estimate, the existing models, in management's

                             F-19
<PAGE>
           SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      MARCH 31, 2001 AND 2000

opinion, do not necessarily provide a reliable single measure of
the fair value of its stock options.

Information regarding stock options for the years ended March
31, 2001 and March 31, 2000 is summarized as follows:


                                                Weighted Average
                                  Number of      Exercise Price
                                   Shares           Per Share

Outstanding at March 31, 1999     1,045,600           $ .37
Exercised                                 -           $   -
Expired                                   -           $   -
Forfeited                                 -           $   -
Cancelled                            (5,000)          $   -
Granted                           1,441,500           $ .19
                                 ----------
Outstanding at March 31, 2000     2,482,100           $ .34
Exercised                                 -           $   -
Expired                                   -           $   -
Forfeited                                 -           $   -
Cancelled                          (508,000)          $ .08
Granted                                   -           $   -
                                 ----------
Outstanding at March 31, 2001     1,974,100           $ .35
                                 ==========
Exercisable at March 31, 2001     1,263,104           $ .23
                                 ==========
Reserved for future option
  grants at March 31, 2001        1,800,900
                                 ==========




                                F-20
<PAGE>
           SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      MARCH 31, 2001 AND 2000

     For the purposes of pro forma disclosures, the estimated
fair value of the options is amortized to expense over the
options' vesting period.  The Company's 2001 and 2000 pro forma
information follows:
                                     2001              2000

   Net (Loss) Income              $ (913,330)      $ 4,504,596
                                  ==========       ============
   Net (Loss) Income Per
     Common Share                 $ (.05)          $    .33
                                  ==========       ============

     The 2001 and 2000 pro forma effect on net loss is not
necessarily representative of the effect in the future years
because it does not take into consideration pro forma
compensation expense related to grants made prior to 1995.

     The exercise price of options outstanding at March 31, 2001
ranged between $.32 and $30.00.

NOTE 10 -   401(K) PROFIT SHARING PLAN

     The Company adopted a 401(K) Profit Sharing Plan (the
"401(K) Plan") effective January 1, 1995.  All employees are
eligible to participate in the 401(K) Plan once they have
satisfied the eligibility requirements which are as follows:
employees must be 21 years of age and have completed 3 months of
service with the Company.  The 401(K) Plan is currently funded
by employee contributions plus effective January 1, 2000 the
Company contributes 1/2 of 1% of gross wages, for participating
employees.  Employees may elect to contribute up to, the lesser
of, 15% of their salary or $10,500 for 2001, as adjusted to
reflect annual federal cost of living increases, or such lesser
amount as determined by discrimination tests for the plan.

NOTE 11 -   FAIR VALUE OF FINANCIAL INSTRUMENTS

     The following methods and assumptions were used by the
Company in estimating its fair value disclosure for financial
instruments:

                            F-21
<PAGE>
           SK TECHNOLOGIES CORPORATION AND SUBSIDIARIES
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      MARCH 31, 2001 AND 2000

Cash and Cash Equivalents:  The carrying amounts reported in the
consolidated balance sheets for cash and cash equivalents and
restricted cash approximate their fair values.

Borrowings/Bank Mortgages:  The fair value for borrowings/bank
mortgages is generally estimated using discounted cash flow
analyses, based on the Company's current incremental borrowing
rates for similar types of borrowing arrangements.

     The carrying amounts and fair values of the Company's
significant financial instruments at March 31, 2001 are as
follows:

                                   Carrying
                                    Amount            Fair Value

Cash and cash                      $ 23,042            $ 23,042
 equivalents

Note payable to shareholder         376,000             376,000

Loan payable to shareholder/
 director                           430,000             430,000






                                F-22
<PAGE>
ITEM 8.     CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
            ACCOUNTING AND FINANCIAL DISCLOSURE



                            PART III

ITEM 9.     DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
            PERSONS, COMPLIANCE WITH SECTION 16(a) OF THE
            EXCHANGE ACT

     The following persons are the directors and executive
officers of the Company as of March 31, 2001.  All directors are
elected by the shareholders to serve until the next meeting of
shareholders or until their successors are duly elected and
qualified.  Officers are elected by the Board of Directors to
serve at the pleasure of the Board.


       Name                   Age            Position

Calvin S. Shoemaker            60      President/Chief Executive
                                       Officer/Director

Melvin T. Goldberger           81      Treasurer/Director

Roger N. Oesterling            58      Executive Vice President/
                                       Secretary

Gary S. Spirer                 56      Director

David H. Peipers               44      Director

C. Shelton James               61      Director


     Calvin S. Shoemaker - Mr. Shoemaker has been an officer and
director of the Company since May 1993.  Mr. Shoemaker was a
founder and President of Flashpoint Computer Corp. from 1986
through 1993.  Mr. Shoemaker was with Northridge Corp. from 1984
through 1986; Vice President of Sales and Marketing of Timeplex
from 1983 through 1984 and Vice President of Sales and Marketing
for Gould Inc/SEL Computer Systems from 1971 through 1983.  Mr.
Shoemaker earned a Bachelor of Science degree from Randolph
Macon College.

                                 16
<PAGE>
     Melvin T. Goldberger - Mr. Goldberger has been an officer
of the Company since July 1993 and a director since January
1994.  Mr. Goldberger has been President of Seventh Investment
Bancing Corp. since 1972 to date and is also the President of
MTG Development Inc.  From 1968 through 1971 he was Chairman of
the Board of Vector Company.  Mr. Goldberger is presently
Chairman of the Board of Mae Volen Senior Citizen Center.  He is
also Lifetime Honorary Treasurer and Board Member of the Florida
Philharmonic Orchestra.  Mr. Goldberger earned a Bachelor of
Science degree from Ohio State University.

     Roger N. Oesterling - Mr. Oesterling has been an officer of
the Company since May 1993.  Mr. Oesterling was Senior
Engineering Director of Racal Milgo Inc. from 1989 through 1991
and Senior Director of Network Management from 1985 through
1989.  He was a business manager of Timeplex Inc. from 1984
through 1985 and held various positions as director and manager
of Gould Inc./SEL Computer Systems from 1973 through 1984.  Mr.
Oesterling earned a Bachelor of Science degree from Grove City
College.

     Gary S. Spirer - Mr. Spirer was elected as a director of
the Company on May 13, 1993.  Prior to that date, he served as a
member of the Company's Advisory Board.  Mr. Spirer is President
of Capital Hill Group, Inc. since 1981 which provides consulting
services to the Company.  Mr. Spirer holds a B.A. from New York
University where he graduated Magna Cum Laude and Phi Beta
Kappa, and he holds an M.B.A. from Columbia University.

     David H. Peipers - Mr. Peipers was elected as a director of
the Company on May 13, 1993.  Among other activities, Mr.
Peipers is President of Thorn Tree Management, LLC, an
investment firm dealing with securities and venture capital.  He
also has been a general partner of the Winsome Limited
Partnership and Cornerhouse Limited Partnership, which make long
term investments in the securities of both public and private
companies, since 1989.  Until its sale to Liz Claiborne Inc. in
1999, Mr. Peipers served as chairman of Segrets Inc., a women's
sportswear manufacturer selling primarily under the label Sigrid
Olsen.  Mr. Peipers holds an A.B. from Harvard University (1978)
and a J.D. from Harvard Law School (1981).

                                17
<PAGE>
     C. Shelton James - Mr. James was elected as a director of
the Company on May 13, 1993.  Prior to that date he served as a
member of the Company's Advisory Board.  Mr. James was President
of Fundamental Management Corp. from April 1994 through June
1999 and Chairman and Chief Executive Officer of Elcotel Inc.
from 1991 through February 2000 and October 1999, respectively.
He was President of the Computer Systems Division of Gould, Inc.
from 1980 through 1989 and Executive Vice President of Gould's
Information System Business Section from 1985 through 1989.  Mr.
James has been a director of DRS Inc. since 1999, Technisource
Inc. since 1998, Concurrent Computer Corporation since September
1994 and CSPI since December 1994.  He earned a Bachelors of
Business Administration degree from Clarkson University and a
Masters of Business Administration from New York University.


Compliance with Section 16(A) of the Securities Exchange Act of
1934
     Section 16(a) of the Securities Exchange Act of 1934
requires the Company's directors and executive officers, and
persons who own more than ten percent of the Company's
outstanding Common Stock, to file with the Securities and
Exchange Commission ("SEC") initial reports of ownership and
reports of changes in ownership of Common Stock.  Such persons
are required by SEC regulation to furnish the Company with
copies of all such reports they file.

     To the Company's knowledge, based solely on a review of the
copies of such reports furnished to the Company and written
representation that no other reports were required, all Section
16(a) filing requirements applicable to its officers, directors
and greater than ten percent beneficial owners have been
complied with.


                               18
<PAGE>
ITEM 10.     EXECUTIVE COMPENSATION:

     The following tables set forth executive compensation for
the last three fiscal years, stock awards and stock option
values for the fiscal 2001.
                                Annual Compensation

                                                 Other Annual
Name and            Fiscal    Salary     Bonus    Compensa-
Position             Year       ($)       ($)     tion ($)

Calvin Shoemaker     1999     75,000     12,636         0
President/Chief      2000     75,000     13,072         0
Executive Officer    2001     75,000      7,615         0

All executive
Officers as a        1999    273,115     39,258         0
Group (two           2000    275,750     40,670         0
persons)             2001    152,500     13,960         0

                               Long Term Compensation

                               Awards           Payouts
                   Restricted                              All
                     Stock        Options/      LTIP     Other
Name and            Awards         SARs       Payouts  Compensa-
Position          (# Shares)(1)     (#)  (2)    ($)     tion $)

Calvin Shoemaker            0             0        0          0
President/Chief             0       600,000        0          0
Executive Officer           0             0        0          0

All Executive
Officers as a               0             0        0          0
Group (two                  0     1,240,000        0          0
Persons)                    0             0        0          0

(1)	In July 1997, the Company filed a registration
      statement on Form S-8, with the Securities and
      Exchange Commission, to register 1,400,000 shares of
      Common Stock which may be purchased pursuant to the
      exercise of options under the 1995 Option Plan.
      Accordingly  restricted stock awards were reclassified
      as options in fiscal 1998.

                                 19
<PAGE>
(2)	In December 1999, shareholders owning a majority in
      interest of the Company's stock approved an amendment
      to the Company's 1995 Stock Option Plan to increase
      the number of shares of Common Stock which may be
      issued upon the exercise of options granted through
      the Plan from 1,400,000 to 3,700,000.

      In February 2000, the Company filed a registration
      statement on Form S-8 with the Securities and Exchange
      Commission, to register the additional 2,300,000
      shares of Common Stock which may be purchased pursuant
      to the exercise of options under the 1995 Option Plan.

<TABLE>
                                   Option/SAR Grants in Fiscal 2001


                                           Individual Grants

<CAPTION>
                                                     % of Total Options/
                          Number of Securities       SARs Granted to
                          Underlying Options/        Employees in Fiscal       Exercise or Base Price       Expiration
Name                      SARs Granted (#) (1)       Year                      ($/SH)                       Date
<S>                       <C>                        <C>                       <C>                          <C>
Calvin Shoemaker
President/Chief
Executive Officer         0                          0


              (1)  No options were granted to Executive Officers in fiscal 2001.
</TABLE>


<TABLE>
                                Aggregated Option/SAR Exercises in Fiscal 2001
                                     And March 31, 2001 Option/SAR Values

<CAPTION>
                                                                          Number of                     Value of
                                                                          Securities                    Unexercised
                                                                          Underlying                    In-the-Money
                                                                          Unexercised                   Options/
                                                                          Options/SARs at               SARs at March 31,
                                                                          March 31, 2001(#)             2001 ($)

                          Shares Acquired            Value                Exercisable/                  Exercisable/
Name                      on Exercise (#)            Realized             Unexercisable                 Unexercisable
<S>                       <C>                        <C>                  <C>                           <C>
Calvin Shoemaker
President/Chief
Executive Officer         0                          0                    600,000/400,000               0/0
</TABLE>

                                                            20
<PAGE>
ITEM 11.     SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
             MANAGEMENT:

     The following table sets forth, as of June 15, 2001,
certain information regarding the amount and percentage of
Common and Preferred Stock beneficially owned by each person
known by the Company to own more than five percent of its
outstanding Common and Preferred Stock, each director of the
Company and all officers and directors as a group.

                                   Amount of
Name and Address                   Beneficial         Percentage
Beneficial Owner of               Ownership of         of Voting
Identity of Group                 Common Stock        Securities

Calvin S. Shoemaker(4)(6)              80,091            0.38%
500 Fairway Drive, Suite 104
Deerfield Beach, FL 33441

Gary S. Spirer(1)                     106,300            0.51%
50 Main Street
White Plains, NY 10606

Capital Hill Group                      3,945            0.02%
Gary Spirer, President
50 Main Street
White Plains, NY 10606

David H. Peipers(1)(3)              3,196,064           15.34%
888 Seventh Avenue
New York, NY 10106

Cornerhouse Ltd. Ptshp.(3)          6,217,201           29.84%
David Peipers, G.P.
888 Seventh Avenue
New York, NY 10106

Winsome Ltd. Ptshp(3)               5,982,131           28.71%
David Peipers, G.P.
888 Seventh Avenue
New York, NY 10106

C. Shelton James(1)                   105,973            0.51%
310 E. Royal Palm Road
Boca Raton, FL 33432

                                    21
<PAGE>
Melvin Goldberger(1)(2)                20,333            0.10%
1599 N.W. 9th Avenue
Boca Raton, FL 33486

Seventh Investment
  Bancing Corp.(2)                     93,760            0.45%
Melvin Goldberger, President
1599 N.W. 9th Avenue
Boca Raton, FL 33486

All Directors and
Executive Officers as
a Group (6 persons) (5)            15,850,138           76.08%

____________________________

(1)	Stock options were granted to four directors of the Company
      from August 1996 through January 2000.  Each director
      received options for 50,000 shares of Common Stock at an
      exercise price of $.32 per share.  These are not included
      above.

(2)	Includes 103,060 shares of Common Stock and 11,033 shares
      of Preferred Stock (held by Melvin Goldberger, trustee for
      the Grace Goldberger Trust).

(3)	Includes 14,419,062 shares of Common Stock and 183,334
      shares of Series B Preferred Stock with one vote per share.
      Also includes 793 shares of Series D stock with 1000 votes
      per share and therefore is included as 793,000.

(4)	Includes 63,424 shares of Common Stock and 16,667 shares of
      Preferred Stock.

(5)   As part of the units sold in a September 1993 offering,
      warrants for 447,140 shares of Common Stock at an exercise
      price of $1.00 per share are held by certain of these
      executive officers and directors.

(6)	Stock options were granted to Calvin Shoemaker from August
      1996 through June 1999.  Mr. Shoemaker received options for
      1,000,000 shares of Common Stock at an exercise price of
      $.32 per share.  These are not included above.

                                 22
<PAGE>
ITEM 12.     CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS:

     Pursuant to a May 1993 agreement between the Company and
Fundamental Management Corp. ("Fundamental"), a fee of $25,000
was approved to be paid in installments  to  Fundamental  based
on  the  amount  of  proceeds  received from  the  1993
Preferred  Stock  offering.  The  first  installment  of  $8,333
was paid in May 1993 and $16,667 is included in accounts payable
due to shareholders/officers/directors, at March 31, 2001.

     Pursuant to a May 1993 Consulting agreement between the
Company and Capital Hill Group Inc. ("CHG"), the Company
incurred consulting fees to CHG of $5,550 per month, for a total
of $236,500 through December 1996 when the agreement terminated.
Of this amount $225,500 has been accrued to date and is included
in accounts payable due to shareholders/officers/directors at
March 31, 2001.

     In connection with the Finder's agreement between the
Company and CHG the Company accrued finders fees of $493,000
through December 1996 which is included in accounts payable due
to shareholders/officers/directors at March 31, 2001.

     During fiscal 2001, one shareholder/director of the Company
provided funding to the Company in the amount of $840,000,
$410,000 for 1,366,667 shares at $.30 per share of Common Stock
and the remaining funds of $430,000 for notes payable on demand
at interest rate of 8% annum:


ITEM 13.     EXHIBITS AND REPORTS ON FORM 8-K:

       The following documents are filed as part of this report:

  (a)  Exhibits

       Exhibit # Description of Exhibit

       3.1	   Certificate of Incorporation, as amended, through
               September 19, 1992, is incorporated herein by
               reference to the Registration Statement on Form
               S-18, File No. 33-27977-A, as declared effective
               on July 10, 1989, as amended by Post-Effective
               Amendment No. 1 declared effective on September
               12, 1990, as amended by Post-Effective Amendment

                               23
<PAGE>
               No. 2 declared effective on November 15, 1991
               (collectively, the "Registration Statement"), the
               Annual Report on Form 10-K for the fiscal year
               ended March 31, 1990, File No. 0-18184 filed June
               29, 1990 2("1990 10-K"), and the Annual Report on
               Form 10-K for the fiscal year ended March 31,
               1991, File No. 0-18184 filed July 13, 1991 ("1991
               10-K").

       3.2     Amended Certificate of Designation of Preferences
               Right and Limitations dated November 1, 1991 is
               incorporated herein by reference to the
               Registration Statement on Form S-1, as amended,
               File No. 33-44402, declared effective by the
               Commission on May 15, 1992 ("Form S-1").

       3.3	   The Bylaws are incorporated herein by reference
               to the Registration Statement.

       3.4	   Certificate of Amendment of the Certificate Of
               Incorporation dated November 4, 1996 is
               incorporated herein by reference to schedule 14C
               filed on November 5, 1996.

       4.1	   Warrant Agreement between the Registrant and
               Interwest Transfer Company is incorporated herein
               by reference to the 1990 10-K.

       4.2	   Certificates of Designations, Preferences Rights
               and Limitations - Series B Convertible Redeemable
               Preferred Stock dated February 17, 1993 and
               amended April 14, 1993 is incorporated herein by
               reference to the 1993 10-KSB.

       4.3	   Amended Certificate of Designation of Preferences
               Rights and Limitations Series B Convertible
               Redeemable Preferred Stock dated March 23, 1993
               is incorporated by reference to the 1993 10-KSB.

       4.4     Certificate of Designation of Preferences Rights
               and Limitations Series D Redeemable Preferred
               Stock is incorporated herein by reference to the
               2000 10-KSB.

                                 24
<PAGE>
       10.1	   May 13, 1993 Financial Consulting Agreement
               between the Registrant and Capital Hill Group,
               Inc. ("Financial Consulting Agreement") is
               incorporated herein by reference to the 1991 10-
               K.

       10.2	   Amendment to Financial Consulting Agreement dated
               May 13, 1993 is incorporated herein by reference
               to the 1993 10-KSB.

       10.4	   Finder's Agreement between the Registrant and
               Capital Hill Group, Inc. ("Finder's Agreement")
               is incorporated by reference to the 1991 10-K.

       10.5	   Amendment to Finder's Agreement, dated May 13,
               1993 is incorporated by reference to the 1993 10-
               KSB.

       10.9    Solution Provider agreement between NCR
               Corporation and the Registrant dated February 7,
               1994 is incorporated herein by reference to the
               1994 10-KSB.

       10.11   Consulting Agreement between the Company and C.
               Shelton James and Fundamental Management
               Corporation, dated May 13, 1993 is incorporated
               herein by reference to the 1993 10-KSB.

       10.12   Promissory Note dated November 7, 1992, as
               amended March 9, 1993 and April 7, 1993, with
               Baron Coleman as Holder and the Company as Maker
               is incorporated herein by reference to the 1993
               10-KSB.

       10.16   SK Technologies Corporation Amended 1995 Stock
               Option Plan is incorporated herein by reference
               to the Form S-8 filed on February 14, 2000.

       21.     Subsidiaries of the Registrant is incorporated by
               reference to the 1991 10-K.

                                    25
<PAGE>
       22.     Information Statement sent on December 16, 2000
               to notify shareholders of the Company's intention
               to amend its 1995 Stock Option Plan, to increase
               the number of shares of Common Stock which may be
               issued upon the exercise of options granted
               through the Plan, from 1,400,000 to 3,700,000 is
               herein incorporated by reference to Schedule 14c
               filed on December 17, 1999.


  (b)  Reports on Form 8-K

       The Company did not file any reports on Form 8-K during
       the three months ended March 31, 2001.

                                     26
<PAGE>
                            SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, SK Technologies Corporation has
duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                             SK TECHNOLOGIES CORPORATION,
                             a Delaware corporation


Date:  June 25, 2001         By:  /s/ Calvin S. Shoemaker
                                  Calvin S. Shoemaker, President


     Pursuant to the requirements of the Securities Exchange Act
of 1934, this report has been signed by the following persons on
behalf of the registrant and in the capacities and on the dates
indicated.

   Signature                     Title                  Date


/s/ Calvin S. Shoemaker     President/Chief        June 25, 2001
Calvin S. Shoemaker         Executive Officer/
                            Director

/s/ Melvin T. Goldberger    Treasurer/Director/    June 25, 2001
Melvin T. Goldberger        Principal Accounting
                            Officer

/s/ C. Shelton James        Director               June 25, 2001
C. Shelton James

/s/ David H. Peipers        Director               June 25, 2001
David H. Peipers

Gary Spirer                 Director