<PAGE>
                                 UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, DC 20549
                                       
                                 FORM 10-KSB
                                       
[x]  Annual report under Section 13 or 15(d) of the Securities Exchange Act of
     1934 for the fiscal  year ended 4/30/96 

[ ]  Transition report pursuant to Section 13 or 15(d) of the Securities
     Exchange Act of 1934 for the transition period from ________ to ________.

                          Commission File No. 1-3896
                                       
                           BULLION MONARCH COMPANY
                (Name of small business issuer in its charter)

                  Utah                                   82-0198422             
----------------------------------------    ------------------------------------
    (State or other jurisdiction of         (IRS Employer Identification Number)
     incorporation or organization)         

       216 E. 1300 S., Orem, Utah                           84058               
----------------------------------------    ------------------------------------
(Address of principal executive offices)                  (Zip Code)            

                   Issuer's telephone number: (801) 221-9893
                                       
        Securities registered under Section 12(b) of the Exchange Act:

         Title of each class           Name of each exchange on which registered


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

Securities registered under Section 12(g) of the Exchange Act:

                          Common Stock No Par Value           
                  ----------------------------------------    
                               (Title of class)

    Check whether the Issuer (1) filed all reports required to be filed by
sections 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.
(1)  Yes [ ]  No [x]             (2) Yes [x]   No [ ]

<PAGE>

    Indicate by check if disclosure of delinquent filers pursuant to Item 405
of Regulation S-B is not 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 amendment to this Form 10-KSB.  [X]

    Issuer's revenues for its most recent fiscal year: 4/30/96 $1,457,383

    The aggregate market value of the voting stock held by non-affiliates
computed by reference to the average bid and asked price of such stock in the
over-the-counter market on 4/30/96  was $8,072,366

    Check whether the issuer has filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court.
Yes [ ] No [ ]  NA

    As of 4/30/96 the Issuer had outstanding 18,772,943 shares of its no par,
common stock.

<PAGE>

                                    PART I
                       ITEM 1.  DESCRIPTION OF BUSINESS

GENERAL

    Bullion Monarch Company (hereinafter known as the "Company") is a natural 
resource Company engaged in acquiring, exploring, leasing, joint venturing, 
and selling mining  properties.    Substantially all of the Company's 
operations are located in the Western United States, in the states of Nevada, 
Utah and Montana.
    
    The Company continues to actively pursue its long-held corporate strategy 
of exploring and acquiring land positions in close proximity to major mining 
operations and/or properties with known deposits, for development with 
joint-venture partners or sale to third parties.  Bullion locates and 
explores potential properties, with the idea of developing them to the point 
of production, while turning over the day to day operation to independent 
third parties.

HISTORY AND ORGANIZATION

    The Company was incorporated in the state of Utah on May 13, 1948 under 
the name of Bullion Monarch Uranium Company, and is publicly held.  In 
February of 1969 the Company entered into a business merger with M. M. & S. 
Exploration Company a Nevada corporation, pursuant to which M .M. & S took 
over management of Bullion Monarch Company.

    Bullion Monarch was organized during the uranium boom and operated in the 
1950's.  Bullion later ventured into precious metals and oil.

    M. M. & S. Exploration Co. was organized in August of 1955 under the 
leadership of Robert D. Morris Sr.,  and set out to become a significant 
player in the mining industry.  The Company's first success was in the now 
famous Carlin Gold Trend.  Two mines were developed and operated; The 
Bootstrap Mine and Bluestar Mine in the late 1950's and early 1960's.  
Newmont Mining was introduced to the area by M. M. & S. Exploration in the 
late 1950's.

    Bullion built a flotation concentration plant during the late 1960's 
about one mile from Austin, Nevada to process the old silver mine dumps.  Due 
to the decline in the price of silver only about 50,000 tons were processed.  
The plant was then used as a custom mill to process:  flourspar, antimony, 
gold, silver and tungsten from other sources.  The Austin plant has not 
operated since 1989.  

BUSINESS OPERATIONS

GENERAL

    Bullion Monarch Company derives its revenues from exploring, acquiring 
and developing mining properties in the Western United States, primarily in 
the State of Nevada.  The Company has been involved in mining in Nevada and 
more particularly in the Carlin Trend, for many years.  The Company's mining 
interests in Nevada are vital to its future prospects for success. Total ore 
production from mining in Nevada provides 64% of total U.S. ore production 
with a significant percentage coming from mines in the Carlin Trend.  In 
addition to its property interests in Nevada, management feels that its 
knowledge and experience in mining in the state of Nevada is a valuable asset 
to Bullion Monarch.  The past ten years have been extremely difficult for 
many "junior" mining companies because changes in environmental and 
investment regulation have made it more expensive to meet tougher standards 
and more difficult to raise capital.  Primarily because of the experience and 

<PAGE>

knowledge of Bullion's President, R. Don Morris, the Company has been able to 
retain control of valuable mining interests, in an incredibly challenging  
environment. 

Through its activities the Bullion Monarch has acquired various rights, 
royalties and interests in mining properties with great appeal to outside 
parties.  The Company develops its properties in partnership with companies 
who the have the capital necessary to fund the large and expensive programs 
required to bring properties into production.  The Company has entered into 
agreements with various parties to fund the exploration and development of 
some of its more promising properties.  The Company benefits from these 
agreements by giving up a percentage of its interest in the properties in 
exchange for cash payments and commitments from its partners to spend 
pre-determined amounts, in the further exploration and development of the 
Company's properties. A summary description of the Company's properties can 
be found in ITEM 2.

COMPETITION

    The Company competes with major mining companies for the acquisition of 
new mining properties.  Bullion has limited financing; many companies with 
which Bullion competes have greater resources, and are more financially 
secure. However, the demand for precious metals is such that once a metal is 
produced it can be sold at an established market price which has made the 
exploration and production of such mineral resources, while highly 
speculative, highly lucrative.

EMPLOYEES

    In December 1995 the Company entered into employment contracts with three 
of its officers and one consultant who had been providing management services 
for the past several years without contracts and with very limited 
compensation. Management believes that offering employment and compensation 
to these individuals will have a significant positive impact on the future 
success of the Company.  A brief background of each employee is found in Item 
9.

                      ITEM 2.  DESCRIPTION OF PROPERTIES
                                    NEVADA
                                       
    BULLION MINE PROPERTY: Bullion Monarch Company holds a staged royalty
    interest on the property presently being drilled jointly by NEWMONT MINING
    COMPANY and BARRICK GOLD CORP., who own lease rights to the property.  The
    Company holds a 4% Net Smelter Return (NSR) until five hundred thousand
    ($500,000) is paid, 2% NSR until one million ($1,000,000) is paid and a 1%
    royalty thereafter.  The property is presently being explored and has a
    drill indicated resource upwards of 3.75 million ounces.  The 40 % Barrick
    interest was acquired from High Desert Mineral Resources of Nevada as the
    major part of a $75.8 million sale in December 1995.  The property is
    adjacent to Newmont's Carlin Gold No.1 Mine and is located in Sections 1,
    2, 10, 11 and 12 T35N, R50E Eureka County, Nevada.

    NORTH PIPELINE 440 ACRES PROPERTY: GOLD VALLEY RESOURCES INC. has agreed to
    explore the property to earn-in a 75% interest.  Under the terms of the
    agreement Gold Valley will pay 
                                      
                                   Page 2 
<PAGE>

    $62,500 in cash plus and additional $300,000 in cash or acceptable 
    securities and spend $1,900,000 in exploration by the third anniversary.  
    Bullion Monarch retains a 25% carried interest.  The property is located 
    in Section 9, T29N, R47E, Lander County, Nevada approximately seven miles 
    north of Placer Dome's Pipeline deposit (a deposit with a reported 
    12 million ounces of gold reserves).

    SOUTH BULLION PROPERTY: in 1995 Cypress Gold approached the Company with a
    proposal to renegotiate the option which they held on the South Bullion
    property.   Management declined and reached an agreement under more
    favorable terms with GOLD VALLEY RESOURCES INC.  which requires Gold Valley
    to pay $187,500 in cash on signing plus $900,000 in cash or acceptable
    securities.  Gold Valley will spend a minimum of $200,000 as a work
    commitment in the first year.  Bullion retains a 25% carried interest in
    the property.  A gold resource of 400,000 ounces was defined by Newmont
    Mining prior to Bullion's acquisition of the property leases in a land
    trade with Newmont.  The property lies at the Southern end of the Carlin
    Trend five miles south of Newmont's Rain Mine.

    WILLOW CREEK PROPERTY: Bullion Monarch is joint-ventured on this property
    with KNOMEX RESOURCES INC. And GOLD VALLEY RESOURCES INC. and has a 25%
    carried interest.  The property is located at the northern end of the
    Carlin Trend in Elko County, Nevada and consists of 34 unpatented lode
    mining claims covering approximately 680 acres.  A drill program of two 800
    foot holes along with geochemical mapping is under way.

    MAGGIE CREEK EAST PROPERTY (SCHROEDER MOUNTAIN): this property is located
    approximately eight miles north of Carlin, Nevada.  It is situated adjacent
    to Newmont's Maggie Creek claims to the west and consists of approximately
    1900 acres.  Bullion has a one third interest in these claims with its
    partners MINEX EXPLORATION and KLONDEX GOLD & SILVER COMPANY.  Evaluation
    work is ongoing.

    SWALES MOUNTAIN PROPERTY: Bullion owns a 50% interest in 16 unpatented
    claims mining claims (approximately 320 acres) on Swales Mountain located
    in Elko County, Nevada.  The remaining interest is held by Klondex Gold &
    Silver Company.  Surface geology is similar to that in the Carlin Mine
    area, located 10-15 miles east of the property.

    SOUTH MAGGIE PROPERTY: this property is located at Sec. 12 and 14 T33N,
    R51E just south of and bordering on Newmonts Gold Quarry/Maggie Creek
    deposits.  Bullion holds a 3% net smelter return royalty.

    PRINCE OF WALES AND COMMODORE MINES: Bullion holds a 100% interest in six
    patented mining claims in the Rush Valley Mining District an old but very
    productive mining area in Tooele County, located 10 miles south of
    Stockton, Utah.  KENNECOTT MINING has been actively drilling claims
    approximately one mile west of this property.

    MONARCH MILL: Bullion owns an undivided one half interest in the Monarch
    Mill situated in Sections 12 and 13, T19N, R43E, in Lander
    County, approximately 2 

                                   Page 3 
<PAGE>

    miles northwest of Austin in Central Nevada.  The mill is a floatation 
    concentrator and would require permit renewals before becoming operational.
    GOLD STANDARD OF NEVADA, INC. owns the remaining interest.  Negotiations are
    on-going with third parties to joint venture the milling and smelting 
    facilities.

    BENTLEY MINE: Bullion owns a 5% royalty from production on the property,
    located on seven lode mining claims near Battle Mountain.  There are no
    operations on the property at this time.

    MELROSE MONTANA PROPERTY: Bullion owns a 100% interest in six patented
    mining  claims in Madison County, Montana, T2S, R8W.  This lead/silver
    property was last mined in the 1950's and early 1960's.  There are no
    immediate plans for this property.
    
ITEM 3.  LEGAL PROCEEDINGS

    As of this date, there are no legal proceedings against this Company or by
this Company.

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

At the Company's annual meeting the following individuals were elected 
directors:

              R. Don Morris
              Peter A. Passaro
              James A. Morris
              Philip L. Manning

    Please see PART II, ITEM 5 for a complete listing of officers and directors.

    Additionally, the CPA firm of Christensen, Gyllenskog & Co. P. C. as
independent and public accountants for the Company were ratified.

    The shareholders ratified and approved all actions taken by the Board of
Directors since the last annual meeting of the shareholders.

                                   PART II


                      ITEM 5.  MARKET FOR COMMON EQUITY
                       AND RELATED STOCKHOLDER MATTERS

    The Company's common stock is traded in the over-the-counter market.  Set 
forth below is the high and low bid quotations for the Company's common stock, 
for each quarter of the fiscal years ended April 30, 1996, as reported based 
on inter-dealer bid quotations, without mark-up, markdown, 

                                   Page 4 
<PAGE>

commissions, or adjustments (which may not reflect actual transactions).

    Trading activity in Bullion Monarch increased dramatically in 1996. As
events favorable to Bullion Monarch became public, the stock began a steady 
upward climb reaching a high of $.4375. Bullion Monarch Company stock is traded
under the symbol: BMRK.

     Quarter Ended:            Low Bid            High Bid       
                               (common stock)     (common stock) 
     July 31, 1995             $ 0.05             $ 0.10         
     October 31, 1995          $ 0.06             $ 0.25         
     January 31, 1996          $ 0.125            $ 0.43         
     April 30, 1996            $ 0.1875           $ 0.4375       

    The Company has declared no cash dividends on its shares of common stock
during the most recent fiscal year and does not intend to do so in the
foreseeable future.
                                       
                    ITEM 6.  MANAGEMENT'S DISCUSSION AND 
          ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

LIQUIDITY

    The Company's liquidity position as of April 30, 1996 as compared with the
same period for 1995 is summarized as follows:


                                               1996            1995    
                                                                       
     CURRENT ASSETS                         $1,882,357       $615,042  
                                                                       
     CURRENT LIABILITIES                       392,801        516,810  
                                                                       
     DIFFERENCE                              1,489,556         98,232  
                                                                       
     INCREASE OR (DECREASE) IN WORKING       1,391,324        150,575  
     CAPITAL FOR THE YEAR

    The Financial Statements reflect that the current ratio for the Company is
4.79 to 1 and  there was a increase in working capital for the year of
$1,391,324.  The Company's current liabilities  ($392,801) are in large part
made up of deferred taxes on the installment sale of the South Bullion property.

Management has improved the liquidity of the Company, by successfully leveraging
its assets through joint-ventures on its properties with capital intensive
companies.  Management believes that 

                                   Page 5 
<PAGE>

the agreements reached this year and those which are in process to be culminated
at a later date, will provide sufficient liquidity for the Company to fund 
ongoing operations for the foreseeable future. 

IMPACT OF INFLATION

    In the past, inflation was a significant factor to be dealt with by the
Company and the economy in general.  Inflation over the past several years has
not been a significant factor, and precious metal prices have not had great
fluctuations.  It is management's continuing policy to deal with precious metal
properties which historically react in a favorably to inflationary pressure. 
Inflation is presently not a problem due in part to small, stable rates of
inflation.  Current precious metal prices remain relatively constant which has
exerted a stabilizing influence upon the Company's overall operating plans. 

    The historical method of accounting does not take into account the rise in
real property values due to inflation.  The Company therefore feels many of its
assets are undervalued for general accounting purposes.  The Company's ability
to operate profitably is controlled to a large extent by world market conditions
over which Bullion has no control.

RESULTS OF OPERATIONS 

    Management is pleased with the results achieved this year.  The Company
operated at a profit for the second consecutive year.  The Company was
successful in structuring two joint-ventures, in which it raised $300,000 in
cash, received a commitment for exploration of the two properties, and retained
a 25% carried interest in each.  The cash raised from these and other subsequent
deals will provide management with the operating budget necessary, to be much
more pro-active in enhancing the value of the Company than in the past. 

    In reviewing the Financial Statements, the Company has taken a conservative
posture.  The market value of the assets reflected in the statements is
considerably higher than their cost or book value.  The South Bullion property
for example has a current book value of less than thirty thousand dollars
($30,000).  However, a 75% interest in the property was sold to Gold Valley
Exploration for over one million dollars ($1,087,500).  Bullion retains a 25%
carried interest in this property.   

    Bullion's management believes that some mining properties and the Austin
Mill could be sold for amounts in excess of their book value, if necessary, to
maintain a strong liquidity position.  The net gain in operations of $836,334
was primarily attributable to the sale to Gold Valley Resources of the South
Bullion property.  Additionally, the Company reached agreements on outstanding
liabilities, in which balances owing, were retired for common stock of the
Company.  This agreement significantly reduced the total current liabilities.

RECENT DEVELOPMENTS

    In December 1995 Barrick Gold Corp. purchased from High Desert Mineral
Resources, a 40% interest in the Bullion Mine Property for $75.8 million. 
Newmont Mining and Barrick Gold are 

                                   Page 6 
<PAGE>

drilling the property jointly.  In management's view that this transaction adds
significantly to the value of Bullion Monarch's staged royalty interest in the 
Bullion Mine.  It is management's opinion that there will be additional reserves
identified as exploration work continues on this property. 

MINING EXPLORATION; CERTAIN NEGATIVE CONSIDERATIONS

    Each of the Company's properties requiring additional exploration and
development has been retained based upon management's belief that they contain
minerals in commercial quantities.  Such beliefs are based upon underlying
geological criteria and other information.  However, management can give no
assurance whether commercial quantities will be found and if so, that production
will ensue.

    It is possible that the Federal Government, through the EPA or other
Federal or State agencies, may impose more restrictive laws and regulations
which may adversely affect the exploration and development of mining claims in
general and those of the Company in particular.  Financial commitments necessary
to comply with such laws, could restrict the ability of the Company to explore
and develop its properties.

    The drilling of mining properties in exploration of ore deposits, can be
adversely affected by inclimate weather conditions. 

LOOKING FORWARD

    After several difficult years, Bullion Monarch is now in a financial
position which will allow management to aggressively explore properties for
possible acquisition and to seek development partners for its existing
properties.   Discussions are in progress with various parties which may
significantly benefit the Company. It is management's opinion that the Company
has an excellent inventory of promising properties which could have a positive
impact on operations and profits in the future. Management believes that the
present price of its stock does not reflect the actual value of the Company. 
Accordingly, management is working with outside analysts and consultants to aid
in disseminating positive information about the Company's progress to
institutional investors.  Management is excited about the progress made during
the past year and is very optimistic about the future of Bullion Monarch.

             ITEM 7.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

    Financial Statements and Supplementary Data are set forth beginning after 
page 10.

         ITEM 8.  DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

    None.

                                   Page 7 
<PAGE>

                                   PART III
         ITEM 9.  DIRECTORS AND EXECUTIVE OFFICERS OF REGISTRANT

                                                           OFFICER OR DIRECTOR
NAME                AGE     POSITION/DIRECTOR CLASS                SINCE
----                ---     -----------------------        -------------------

                            CLASS III DIRECTORS
                            (TERM EXPIRES 1999)

Peter Passaro       48      Chairman of the Board, CEO              1991

R. Don Morris       52      President, COO, Director                1969

                            CLASS II DIRECTORS
                            (TERM EXPIRES 1998)

James A. Morris     28      Sec./Tres., Director                    1992


                            CLASS I DIRECTORS
                            (TERM EXPIRES 1997)

Philip L. Manning   37      Director                                1995


BIOGRAPHICAL INFORMATION

    PETER PASSARO, age 48, has served on the Board of Directors since May 1,
1991.  Mr. Passaro is a 1968 graduate of the University of Connecticut with a
degree in Political Science, and is president and C.E.O. of E&P Foundry for the
past 19 years.  He has worked in the foundry business for the past 23 years. Mr.
Passaro has been hired as C.E.O. for the Company.

    JAMES ANDREW MORRIS, age 28, is the Secretary/Treasurer of Bullion Monarch 
Company.  Mr. Morris is a graduate of Brigham Young University, receiving a 
Bachelor of Science degree in Business Management.  Mr. Morris is owner/operator
of a Las Vegas Discount Golf and Tennis franchise in Orem, Utah.

    R. DON MORRIS, age 52, has been a director since 1969.  Mr. Morris received
a Bachelor of Science degree in Geology from Brigham Young University in 1966
and worked on a full time basis for Bullion from 1966 to 1984.  Mr. Morris 
agreed to an employment contract with the Company, and now serves as president
and Chief Operating Officer.


                                      Page 8

<PAGE>

    PHILIP L. MANNING, age 37, is a graduate of Brigham Young University and
holds a Master of International Management degree from The American Graduate
School of International Management. Over the past 12 years, he has worked as an
investment manager in evaluating, investing in and managing businesses for
William Wright Associates and as a Financial Consultant for Merrill Lynch.  He
is currently self-employed in the investment industry.



    ITEM 10. EXECUTIVE COMPENSATION


    From 1973 to 1995, no officer or director received remuneration or
compensation which equaled or exceeded $50,000 in one year.  In December of 
1995 Bullion Monarch reached employment agreements with its officers and
directors.


    The following information is given with respect to the fiscal year ending
4/30/94 for the five highest paid executive officers of the Company, and for
all officers and directors as a group.


(A)                  (B)                  (C)                  (D)
NAME OF INDIVIDUAL   CAPACITY IN WHICH    AGGREGATE OF CASH    EQUIVALENT
CONTINGENT OR        REMUNERATION WAS     AND SALARIES AND     PERSONAL
IDENTITY OF GROUP    RECEIVED             FEES                 BENEFITS
REMUNERATION

R. Don Morris        Director/C.O.O.        60,000             None

Peter Passaro        Director/C.E.O.        32,000             None

James A. Morris      Sec/Treasure           36,000             None

Philip L. Manning    Director               16,000             None
                                          --------

Total                                     $144,000    



                                   Page 9

<PAGE>

    ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

1.  Security Ownership of Certain (10%) Beneficial Owners:

    R. Don Morris is the only shareholder holding 10% or more of the common
shares of the Company.


2.  Security Ownership of Management
* (1)  Peter Passaro                      902,000        4.8%
       303 Cedar Lane
       New Cannan, CT 
       06840 
*(2)   James A. Morris                    455,000        2.4%
       1226 N. 1380 W.
       Mapleton, UT
       84664

*(3)   R. Don Morris                    3,140,000       16.7%
       216 E. 1300 S.
       Orem, UT
       84058
*(4) Philip L. Manning                     50,000       Less than 1%
       10024 Oak Road West
       Cedar Hills, UT
       84062


2.  See "Management and Executive Officers of Registrant" for biographical
    information.

3.  MAJOR ISSUANCE OF STOCK SINCE THE LAST ANNUAL REPORT:
    There were 4,162,000 shares of common stock issued since the last annual
    report to retire amounts due to related parties.  This amount significantly
    reduces the current liabilities account.



                                   Page 10

<PAGE>

    ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
None.  

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

None.
                                 REPORTS ON FORM 8-K:

    No reports on Form 8-K were filed during the last fiscal quarter of its
fiscal year ended April 30, 1996.





                                   Page 11

<PAGE>

                                      SIGNATURES

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


                                       BULLION MONARCH COMPANY


                                       By: 
                                           -----------------------------------
                                           R. Don Morris, President
                                                (Principal Executive Officer)
                                                         and director

Date: September ____, 1996

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

            NAME AND TITLE                                      DATE
            --------------                                      ----

----------------------------------                       September ____, 1996
R. Don Morris, President
(Principal Executive Officer)
     and Director


----------------------------------                       September ____, 1996
James A. Morris, Sec. / Treasurer
(Principal Accounting Officer)
      and Director



<PAGE>






                     BULLION MONARCH COMPANY AND SUBSIDIARY          

                            APRIL 30, 1996 AND 1995

                       CONSOLIDATED FINANCIAL STATEMENTS

                      (WITH INDEPENDENT AUDITOR'S REPORT)



<PAGE>

                                 [Letterhead]

                                       

                          INDEPENDENT AUDITOR'S REPORT

To The Board of Directors
Bullion Monarch Company


We have audited the accompanying consolidated balance sheets of Bullion 
Monarch Company and Subsidiary as of April 30, 1996 and 1995, and the related 
consolidated statements of operations, stockholders' equity, and cash flows 
for the two years then ended.  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 audits 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 financial statement presentation.  We believe 
that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above 
present fairly, in all material respects, the financial position of Bullion 
Monarch Company and Subsidiary as of April 30, 1996 and 1995, and the results 
of its operations and its cash flows for the years then ended in conformity 
with generally accepted accounting principles.

The accompanying consolidated financial statements have been prepared 
assuming that the Company will continue as a going concern.  The Company has 
not experienced regular operations for several years.  Reference is made to 
Note 2 concerning the Notes Receivable and Accrued Interest Receivable 
aggregating $511,703 from a joint venture partner as of April 30, 1996.  
Realization of these receivables is dependent upon the operation or sale of 
the mill at Austin, Nevada.  The ultimate outcome of this uncertainty cannot 
presently be determined.  Accordingly, the consolidated financial statements 
do not include any adjustments that might result from the outcome of this 
uncertainty.



CHRISTENSEN, GYLLENSKOG & CO., P.C.
Midvale, Utah
August 31, 1996







<PAGE>

                       BULLION MONARCH COMPANY AND SUBSIDIARY
                            CONSOLIDATED BALANCE SHEETS

                                                 APRIL 30,       APRIL 30,
                                                   1996            1995
                                                 ---------       ---------
               ASSETS                          
               ------                          
Current Assets:                                
  Cash                                          $  169,654      $    5,103
  Receivables:                                 
    Notes                                        1,513,397         313,397
    Interest                                       198,306         264,542
                                                ----------      ----------
      Total receivables                          1,711,703         577,939
  Deposit                                            1,000          10,000
  Deferred income taxes, current                      -             22,000
                                                ----------      ----------
                                               
      TOTAL CURRENT ASSETS                       1,882,357         615,042
                                               
Investment in Equity Securities, at            
 lower of cost or market                              -             22,500
Investment in Equity Securities available      
 for sale                                          133,562            -
Mining Properties, at cost                         368,281         390,031
Property, Plant and Equipment, at cost,        
 net of accumulated depreciation                    97,580          95,241
Deferred Income Taxes, net                            -            104,000
Other Assets                                         5,000           5,000
                                                ----------      ----------
                                               
      TOTAL ASSETS                              $2,486,780      $1,231,814
                                                ----------      ----------
                                                ----------      ----------
   LIABILITIES AND STOCKHOLDERS' EQUITY        
   ------------------------------------
Current Liabilities:                           
  Accounts payable                                  15,741          12,632
  Accrued expenses                                  63,935          49,547
  Amounts due related parties                       41,451         454,631
  Deferred income taxes payable                    271,674            -
                                                ----------      ----------
      TOTAL CURRENT LIABILITIES                    392,801         516,810
                                                ----------      ----------
                                               
Commitments and Contingent Liabilities           
                                               
Stockholders' Equity:                          
  Common stock, no par value; authorized       
   100,000,000 and 15,000,000 shares for 1996   
   and 1995; issued 18,772,943 and 14,515,193   
   respectively                                  3,398,105       2,972,330
  Unrealized gain on securities available      
   for sale                                        116,866            -
  Accumulated deficit                           (1,415,485)     (2,251,819)
                                                ----------      ----------
                                                 2,099,486         720,511
  Less 7,500 treasury shares, at cost                5,507           5,507
                                                ----------      ----------
      Total stockholders' equity                 2,093,979         715,004
                                                ----------      ----------

      TOTAL LIABILITIES AND STOCKHOLDERS' 
       EQUITY                                   $2,486,780      $1,231,814
                                                ----------      ----------
                                                ----------      ----------

   See auditors' report and notes to consolidated financial statements.

<PAGE>

                       BULLION MONARCH COMPANY AND SUBSIDIARY
                        CONSOLIDATED STATEMENTS OF OPERATIONS
                    FOR THE YEARS ENDED APRIL 30, 1996 AND 1995


                                                    1996            1995
                                                 ----------      ---------
Revenues:
  Sale of mining properties                      $1,341,250      $     -
  Rents                                               5,000          5,000
  Option income                                      79,793        149,996
  Interest                                           31,340         31,340
  Forgiveness of debt income                           -            51,240
                                                 ----------      ---------
      TOTAL REVENUES                              1,457,383        237,576
                                                 ----------      ---------

Costs and expenses:
  Cost of mining properties                          21,750           -
  Mining costs                                          400          1,533
  General and administrative expenses               221,377        116,379
  Interest expense                                     -             8,315
  Depreciation expense                               25,086         21,601
  Minority interest in loss of subsidiary           (11,174)       (17,374)
                                                 ----------      ---------
      TOTAL COSTS AND EXPENSES                      257,439        130,454
                                                 ----------      ---------

Income from operations                            1,199,944        107,122

Other income (expense):
  Gain on sale of securities                         34,185           -
                                                 ----------      ---------

Income before income taxes                        1,234,129        107,122

Provision for income taxes (benefit)                397,795       (125,853)
                                                 ----------      ---------

      NET INCOME                                 $  836,334      $ 232,975
                                                 ----------      ---------
                                                 ----------      ---------

Earnings per share:
Net income per common share                      $     .050      $    .016
                                                 ----------      ---------
                                                 ----------      ---------


   See auditors' report and notes to consolidated financial statements.

<PAGE>
                    BULLION MONARCH COMPANY AND SUBSIDIARY     
               CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

                             Common                  Unrealized     Accumulated
                             Shares       Amount        Gain         (Deficit) 
                           ----------   ----------   ----------     -----------

Balance April 30, 1994     14,515,193   $2,972,330       -          (2,484,794)

  Net income                    -            -           -             232,975 
                           ----------   ----------   ----------     -----------

Balance April 30, 1995     14,515,193    2,972,330       -          (2,251,819)

  Common stock issued for                                                      
   retirement of debt       4,257,750      425,775       -               -     

  Unrealized gain on secur-                                                    
   ities available for sale     -            -        116,866            -     

  Net income                    -            -           -             836,334 
                           ----------   ----------   ----------     -----------

Balance April 30, 1996     18,772,943   $3,398,105    116,866       (1,415,485)
                           ----------   ----------   ----------     -----------
                           ----------   ----------   ----------     -----------


      See auditors' report and notes to consolidated financial statements.     

<PAGE>

                        BULLION MONARCH COMPANY AND SUBSIDIARY
                        CONSOLIDATED STATEMENTS OF CASH FLOWS
                     For the Years Ended April 30, 1996 and 1995

                                                        1996          1995
                                                    -----------    ----------
Cash flows from operating activities:

  Net income (loss)                                 $   836,334    $  232,975
                                                    -----------    ----------
  Adjustments to reconcile net income to net 
   cash provided by operating activities:

     Depreciation and amortization                       25,086        21,602
     Forgiveness of debt income                             -         (51,240)
     (Gain) loss on disposal of property               (153,685)         -
     (Increase) in notes receivable                  (1,200,000)         -
     (Increase) decrease in interest receivable          66,236       (33,714)
     Decrease in other assets                             9,000          -
     (Decrease) in bank overdraft                          -           (4,142)
     Increase (decrease) in accounts payable              4,384       (45,255)
     Increase in accrued expenses                        14,388        14,446
     Increase in amounts due related parties             11,320         6,431
     Increase (decrease) in deferred income taxes       397,674      (126,000)
                                                    -----------    ----------
     Total adjustments                                 (825,597)     (217,872)
                                                    -----------    ----------

  NET CASH PROVIDED BY OPERATING ACTIVITIES              10,737        15,103
                                                    -----------     ---------
Cash flows from investing activities:

  Cash deposit for the purchase of property                -          (10,000)
  Purchase of property and equipment for cash           (27,425)         -
                                                    -----------    ----------

  Cash proceeds from the sale of property               181,239          -
                                                    -----------    ----------
  NET CASH PROVIDED (USED) BY INVESTING 
   ACTIVITIES                                           153,814       (10,000)
                                                    -----------    ----------

Cash flows from financing activities:

  NET CASH PROVIDED (USED) BY FINANCING 
   ACTIVITIES                                              -             -
                                                    -----------    ----------

Net increase (decrease) in cash and equivalents         164,551         5,103

Cash and equivalents, beginning of year                   5,103          -
                                                    -----------    ----------

Cash and cash equivalents, end of year              $   169,654    $    5,103
                                                    -----------    ----------
                                                    -----------    ----------

      See auditors' report and notes to consolidated financial statements.

<PAGE>

                       BULLION MONARCH COMPANY AND SUBSIDIARY
                                CASH FLOW STATEMENTS
                    For the Years Ended April 30, 1996 and 1995

                                                    1996            1995
                                                 ----------      ---------

Supplemental Disclosure of Cash Flow Information:
-------------------------------------------------
  Cash paid during the year for:
  Income taxes                                      $   100        $   147
                                                 ----------      ---------
                                                 ----------      ---------


Supplemental Disclosure of Noncash Financing Transaction:
---------------------------------------------------------
In 1996, the Company issued 4,257,750 shares of restricted common stock at 
  $.10 per share for a total of $425,750 to retire certain obligations to 
  shareholders and creditors per approval of the Company's Board of Directors.


      See auditors' report and notes to consolidated financial statements.     


<PAGE>
                                       
                   BULLION MONARCH COMPANY AND SUBSIDIARY
                Notes to Consolidated Financial Statements
                                 April 30, 1996

1.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
    A.  Principles of Consolidation and Operations:
        The consolidated financial statements include the accounts of Bullion 
        Monarch Company (The Company) and its 50% owned subsidiary Monarch 
        Milling-joint venture.  The Company owns mining properties in Nevada, 
        Utah and Montana.  During the year ended April 30, 1996 the articles 
        of incorporation were amended to change the authorized number of 
        shares and the par value of the shares that may be issued to one 
        hundred million no par shares.

        The consolidated financial statement have been prepared in conformity 
        with generally accepted accounting principles.  In preparing the 
        consolidated financial statements, management is required to make 
        estimates and assumptions that affect the reported amounts of assets 
        and liabilities as of the date of the balance sheet and revenues and 
        expenses for the period.  Actual results could differ from those 
        estimates.

    B.  Mining Properties:
        The total investment in mining properties will be amortized on a 
        composite unit-of-production method.  As of April 30, 1996 and 1995, 
        no amortization has been reflected in the accompanying financial 
        statements since such amounts have been determined to be insignificant 
        and the Company has essentially been in a non-operating mode.

        The Company capitalizes costs for mining properties by individual 
        property and defers such costs for later amortization only if the 
        prospects for economic production are reasonably certain. Capitalized 
        costs are expensed in the period when the determination has been made 
        that economic production does not appear reasonably certain.

    C.  Property, Plant and Equipment and Related Accumulated Depreciation:
        Property, plant and equipment are stated at cost.  Maintenance and 
        repair expenditures are charged to income as incurred; renewals and 
        betterments are capitalized.  Gains and losses on sales or other 
        dispositions of property are reflected in earnings, and adjustments of 
        the accumulated reserves for depreciation are made upon retirement of 
        property.  Depreciation is as follows:

                                               Method           Lives
                                           -------------     -----------
            Machinery and Equipment           ACRS/MACRS      5-10 years
            Office Furniture                  ACRS/MACRS      5- 7 years
            Mill and Buildings             Straight-Line     15-20 years


    D.  Income Taxes:
        Deferred income taxes are recognized for income and expense items that 
        are reported in different years for financial reporting purposes and 
        income tax purposes.  The financial statements currently have three 
        significant timing differences which necessitate deferred tax assets 
        or liabilities.  A deferred federal tax liability arises from 
        reporting earnings on the sale of two mining properties (note 5) and a 
        partnership interest (note 2) on the installment method of 
        





<PAGE>

                        BULLION MONARCH COMPANY AND SUBSIDIARY
                      Notes to Consolidated Financial Statements

1.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
       reporting which is different for income tax purposes than it is for 
       financial statement purposes. At ApriL 30, 1996 Bullion had a 
       deferred tax gain of $1,092,000 on the mining properties sale and 
       $262,000 associated with the partnership interest sale. At that 
       date Bullion had a net operating loss carry forward of approximately 
       $752,000. In applying the principles of FAS No. 109 Bullion offset 
       net operating loss carryforward against the deferred gains of 
       $1,092,000 and $262,000. Using a tax rate of 39% for the deferred 
       gains and 34% for the federal net operating loss carryforward, a 
       net deferred tax liability of $271,674 resulted. Because the 
       deferred gain on the mining properties is expected to be realized 
       in the next fiscal year, the deferred tax liability has been shown 
       as a current liability.

    E. Per Share Data:
       Per share data is based on the weighted average number of 
       common shares outstanding during each period.

    F. Cash and Cash Equivalents:
       For purposes of the consolidated statements of cash flows, 
       the Company considers short-term investments purchased with 
       maturities at date of purchase of three months or less to be cash 
       equivalents.

    G. Reclassifications:
       Certain 1995 amounts have been reclassified to conform with 
       1996 classifications. Such reclassifications had no effect on 
       reported net income.

2.  MONARCH MILLING-JOINT VENTURE
    In 1979, Bullion entered into an agreement with PBL Mining, an 
    Illinois partnership, subsequently changed to American Mining Trust 
    (AMT), wherein Bullion sold a 50% interest in a joint venture called 
    Monarch Milling to AMT. Monarch Milling was established to own, 
    refurbish and operate a concentrating mill located at Austin, Lender 
    County, Nevada.

    In 1980 AMT sold its 50% interest in Monarch Milling to Bullion Metals, 
    a Nevada corporation subsequently changed to Gold Standard of Nevada, 
    Inc. (Gold Standard). In conjunction with the sale, Gold Standard 
    assumed the AMT note with Bullion. The note has a current balance of 
    $313,397, bears interest at 10%, and requires annual payments of 
    $60,000. Gold Standard is currently in default on the payment of the 
    note and interest. For financial statement presentation, Gold Standard's 
    minority interest in the consolidated financial statements has been 
    reclassified against interest receivable. No allowance for doubtful 
    collectibility of the note and interest has been reflected in the 
    financial statements since it is management's opinion that Gold 
    Standard's equity in the market value of the joint venture assets 
    (primarily the mill in Austin, Nevada) is sufficient to cover any 
    indebtedness from Gold Standard to Bullion. The receivables have been 
    classified as current since they are in default and therefore currently 
    due, even though their collectibility within the next fiscal year is 
    doubtful, unless the mill is sold. Negotiations are currently on-going 
    with two groups who are interested in refurbishing and operating the 
    mill under a joint venture agreement with Monarch Milling or actually 
    purchasing the mill.

<PAGE>
                                       
                   BULLION MONARCH COMPANY AND SUBSIDIARY
                Notes to Consolidated Financial Statements

3.  PROPERTY, PLANT AND EQUIPMENT
    Property plant and equipment is summarized as follows:
    
                                                  Accumulated     Net
                                         Cost     Depreciation   Value
                                       --------   ------------   ------
    April 30, 1996:
      Land                             $  6,690         -         6,690
      Vehicle                            22,000        3,060     18,940
      Machinery and equipment           123,668      118,467      5,201
      Office furniture                    5,999        5,888        111
      Mill and buildings                763,162      696,524     66,638
                                       --------      -------     ------
                                       $921,519      823,939     97,580
                                       --------      -------     ------
                                       --------      -------     ------
                                       

    April 30, 1996:
      Land                             $  6,690         -         6,690
      Machinery and equipment           118,668      118,467        201
      Office furniture                    5,574        5,463        111
      Mill and buildings                763,162      674,923     88,239
                                       --------      -------     ------
                                       $894,094      798,853     95,241
                                       --------      -------     ------
                                       --------      -------     ------
                                       
4.  INVESTMENT IN EQUITY SECURITIES
    Bullion received 225,000 shares of a private company's stock in a 
    previous year as partial payment from the sale of two mining 
    properties.  The shares have been valued at a nominal value of $.10 
    per share for financial statement purposes through April 30, 1995.  
    During the year ended April 30, 1996, the private company was acquired 
    by a public Canadian company.  Bullion received shares in the public 
    company on a share for share basis.  During the year Bullion sold 
    58,048 shares of the public company for $40,000.  At April 30, 1996 
    the remaining 166,952 shares have been reflected in the financial 
    statements as investment in equity securities available for sale and 
    have been valued at their market value of $133,562.  The unrealized 
    gain of $116,866 has been reflected as an equity adjustment in the 
    balance sheet.
    
5.  MINING PROPERTIES
    Mining properties and claims have been reflected at historical cost 
    which, in managements opinion, is less than market value for each 
    property or claim.
    
    Bullion had previously traded some joint claims in which they had a 
    90% interest for a 90% interest in five mineral lease and surface use 
    agreements (South Bullion Property).  Bullion and their joint claim 
    partner also retained a 3% net smelter royalty in the claims that they 
    traded.  Bullion and their joint claim partner assumed the minimum 
    annual royalty payments due on the leases.  During the year ended 
    April 30, 1996 the Company sold a 75% beneficial interest in the South 
    Bullion  property and another property which was 100% owned by the 
    Company.  The total consideration to be received for the two 
    properties was $1,450,000 of which 10% of 75% of the total consideration
    would be paid to the Company's joint claim partner and the balance to the 
    Company.  $250,000 was received at April 30, 1996  and the balance of 
    $1,200,000 was to be paid in cash or
    
<PAGE>
                                       
                   BULLION MONARCH COMPANY AND SUBSIDIARY
                 Notes to Consolidated Financial Statements

5.  MINING PROPERTIES, CONTINUED
    acceptable securities by April 30, 1997.  The buyer agreed to expend 
    $2,100,000 in an approved exploration program on the properties over a 
    three year period.  Additionally, the buyer agreed to pay all the 
    minimum annual royalty payments on the South Bullion property and any 
    other taxes and fees associated with both properties.  The Company 
    would retain a 25% beneficial interest in both properties.
    
    Bullion remains contingently liable to pay the minimum annual royalty 
    payments on the South Bullion Property if the sales agreement is 
    terminated.  At April 30, 1996 Bullion was contingently liable on the 
    following lease commitments on the South Bullion Property to retain 
    their mineral rights:
    
               Fiscal Year Ending          Minimum Annual Royalty
               ------------------          ----------------------
                 April 30, 1997                   $51,250
                 April 30, 1998                    51,250
                 April 30, 1999                    54,250
                 April 30, 2000                    54,250
                 April 30, 2001                    56,500
                 April 30, 2002                    56,500

6.  INCOME TAXES
    The Company's effective tax rate differs from the expected federal 
    income tax rate as follows:

                                                    1996         1995
                                                    ----         ----

     Income tax expense at statutory rate         $419,604       36,421
     Reduction in tax from application of NOL         -         (36,421)
     Tax benefit created from remaining NOL           -        (194,000)
     Increase (decrease) in valuation allowance    (68,000)      68,000
     State income tax, net of federal benefit       40,722          147
     Changes in tax rate of deferred tax 
       liability                                     5,469         -
                                                  --------     --------
         Provision for income taxes (benefit)     $397,795     (125,853)
                                                  --------     --------
                                                  --------     --------

    The components of the deferred tax assets and liabilities are as 
follows:

                                                    1996         1995
                                                    ----         ----
     Deferred tax assets:
       Net operating loss carryforward            $255,697      296,180
       Net operating loss carryforward - state         689         -
                                                 ---------      -------
           Total deferred tax assets               256,386      296,180

           Less valuation allowance                   -         (68,000)
                                                 ---------      -------
           Total deferred tax assets, net of
             valuation allowance                  256,386       228,180
                                                 ---------      -------

     Deferred tax liabilities:
       Deferred gain on partnership interest
        sale                                       102,180      102,180
       Deferred gain on sale of mining
        properties                                 425,880         -
                                                 ---------      -------
           Total deferred tax liabilities          528,060      102,180
                                                 ---------      -------
           Net deferred tax asset (liability)    $(271,675)     126,000
                                                 ---------      -------
                                                 ---------      -------
                            
<PAGE>

                        BULLION MONARCH COMPANY AND SUBSIDIARY
                      Notes to Consolidated Financial Statements

6.  INCOME TAXES, CONTINUED
    Bullion currently has a net operating loss carryforward of 
    approximately $752,000 which is available to offset the deferred 
    gains mentioned in footnotes 1 and 5. The net operating loss expires 
    in tax years from April 30, 1997 through April 30, 2009.

7.  RELATED PARTY TRANSACTIONS
    As of April 30, 1996 and 1995, the company was liable to certain 
    individuals who are shareholders and/or officers/directors for cash 
    advances made to or for the Company, unpaid salaries or director fees 
    and unreimbursed travel expenses. The total due to these related parties 
    totaled $454,631 at April 30, 1995 and $41,451 at April 30, 1996. During 
    the year ended April 30, 1996 the Company issued 4,162,000 shares of 
    restricted common stock at .10 per share for a total of $416,200 to 
    retire certain obligations to these related parties.
    
    No interest has been accrued on any of the payables except two 10% 
    interest bearing notes totaling $22,000 at April 30, 1995 to an 
    officer/directors. Total accrued interest included in the related 
    party payable at April 30, 1995 was $4,463. These notes and accrued 
    interest were paid off during 1996 by the issuance of restricted 
    common shares as indicated in the preceding paragraph.

    At January 1, 1996 the Company entered into employment agreements with 
    four employee/shareholders. The agreements are for a period of six 
    years with automatically renewable three year terms. The compensation 
    ranges from $48,000 to $84,000 per year for each employee.

8.  INCENTIVE STOCK OPTION AGREEMENT
    On December 5, 1995, the Company adopted an incentive stock option plan 
    for employees, officers, consultants, and directors. The plan is 
    intended to qualify under Section 422 of the Internal Revenue Code. 
    Under the terms of the plan, options to purchase common stock are 
    granted at not less than the estimated fair market value at the date of 
    the grant and are exercisable during specified future periods.
    
    A summary of options granted is as follows:

          Grant Date     Shares Under Option     Option Price per Share
          ----------     -------------------     ----------------------
         Dec. 5, 1995          750,000                    $.55
         Dec. 5, 1995        1,250,000                     .325

    All options expire ten years from the date of the grant.

9.  COMMITMENTS AND CONTINGENT LIABILITIES
    As indicated in note 5, the Company is contingently liable for minimal 
    annual royalty payments on the South Bullion property if the company 
    that purchased the 75% beneficial interest in that property defaults on 
    its contract payments.

<PAGE>

                       BULLION MONARCH COMPANY AND SUBSIDIARY
                     Notes to Consolidated Financial Statements

10.  SUBSEQUENT EVENTS
     Subsequent to year end a Nevada corporation acquired 727,272 common 
     shares of the Company's stock for $.55 per share in a private 
     placement offering. The total purchase price of $400,000 also 
     included a warrant to purchase an additional 727,272 shares at $.75 
     per share. The warrant expires two years after the date it was 
     acquired.
     
     Subsequent to year end, the Company and a joint venture partner 
     entered into a mining lease and option to purchase agreement on 
     certain unpatented mining claims situated in Elko County Nevada. They 
     then sold a 50% working interest in the property. The acquiring 
     company earns their 50% working interest by issuing 200,000 treasury 
     common shares, by making $1,100,000 in option payments, and by 
     expending $2,000,000 on the property over three years.
     
     Subsequent to year end, the Board of Directors approved the 
     redemption of up to 250,000 shares of common stock from the Company's 
     president at $.70 per share.