UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549



FORM 10-QSB

(Mark One)

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

For the quarterly period ended

[ ]TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from

Commission file number

|GLOBAL INNOVATIVE SYSTEMS, INC.(Exact name of small business issuer as specified in its charter)
|------------------------------------------------------------------------------------------------

|Nevada(State or other jurisdiction of incorporation or organization) |  | 98-0217653(I.R.S. Employer Identification No.)
|-------------------------------------------------------------------- |  | ----------------------------------------------

|5975 Selkirk Crescent, Prince George, BC, Canada  V2N 2G9(Address of principal executive offices)
|-------------------------------------------------------------------------------------------------

|(250) 964-2692(Issuer's telephone number)
|-----------------------------------------

|not applicable(Former name, former address and former fiscal year, if changed since last report)
|------------------------------------------------------------------------------------------------



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



APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant 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 [  ]

APPLICABLE ONLY TO CORPORATE ISSUERS

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

21,700,000 common shares issued and outstanding as at May 1, 2001

Transitional Small Business Disclosure Format (Check one):      Yes [  ]     No [X]



Part I - FINANCIAL INFORMATION

Item 1.	Financial Statements.

Our financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles.

DISCLOSURE

To: The Shareholders of
Global Innovative Systems, Inc.

It is the opinion of management that the interim financial statements for the quarter ended March 31, 2001 include all adjustments necessary in order to ensure that the financial statements are not misleading.

Prince George, British Columbia
Date:  May 14, 2001

/s/ signedDirector of Global Innovative Systems, Inc.

GLOBAL INNOVATIVE SYSTEMS INC.(A Development Stage Company)



CONSOLIDATED BALANCE SHEETS(Expressed in US Dollars)



|                                                        | March 31,
2001
(Unaudited) | September 30,
2000
|------------------------------------------------------- | -------------------------- | ------------------
|ASSETS                                                  |                            |                   
|                                                        |                            |                   
|Current assets                                          |                            |                   
|Cash                                                    | $-                         | $726              
|Receivables                                             | 412                        | 390               
|Prepaid expenses                                        | 4,797                      | 4,401             
|                                                        | 5,209                      | 5,517             
|Fixed assets                                            | 6,831                      | 8,136             
|License                                                 | 48,077                     | 50,676            
|                                                        |                            |                   
|                                                        | $60,117
======             | $64,329
======    
|                                                        |                            |                   
|LIABILITIES                                             |                            |                   
|                                                        |                            |                   
|Current liabilities                                     |                            |                   
|Bank overdraft                                          | $1,742                     | $-                
|Accounts payable                                        | 73,435                     | 58,997            
|Accrued liabilities                                     | 13,637                     | 11,462            
|Loan payable to related party (Note 5)                  | 30,449                     | 32,095            
|Advances from stockholders and directors (Note 6)       | 200,172                    | 183,850           
|                                                        | 319,435                    | 286,404           
|                                                        |                            |                   
|STOCKHOLDERS' DEFICIT                                   |                            |                   
|                                                        |                            |                   
|Common stock                                            |                            |                   
|Authorized:  200,000,000 common shares par value $0.001 |                            |                   
|Issued:  21,700,000 common shares                       | 21,700                     | 21,700            
|                                                        |                            |                   
|Additional paid in capital                              | 410,632                    | 410,632           
|                                                        |                            |                   
|Accumulated other comprehensive income                  |                            |                   
|Foreign currency translation gain (loss)                | 1,348                      | (9,927)           
|                                                        |                            |                   
|Deficit accumulated in the development stage            | (692,998)                  | (644,480)         
|                                                        | (259,318)                  | (222,075)         
|                                                        |                            |                   
|                                                        | $60,117
======             | $64,329
======    
|                                                        |                            |                   

The accompanying notes are an integral part of these financial statements

GLOBAL INNOVATIVE SYSTEMS INC.(A Development Stage Company)



CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)(Expressed in US Dollars)

|                                   | January 15, 1997
(incorporation) to March 31, 2001 Cumulative | Three months ended March 31, 
2001 / 2000 | Six months ended March 31,
2001 / 2000
|---------------------------------- | ------------------------------------------------------------- | ----------------------------------------- | --------------------------------------
|EXPENSES                           |                                                               |                                           |                                       
|Accounting, audit and legal        | $69,187                                                       | $10,843                                   | $10,628                               
|Automotive                         | 21,589                                                        | 994                                       | 1,054                                 
|Bank charges and interest          | 8,505                                                         | 900                                       | 55                                    
|Consulting                         | 10,064                                                        | -                                         | 4,000                                 
|Depreciation                       | 6,243                                                         | 433                                       | 518                                   
|Directors' fees                    | 30,000                                                        | 6,000                                     | 6,000                                 
|Insurance, licence and dues        | 22,385                                                        | 2,097                                     | 2,442                                 
|Office and supplies                | 4,704                                                         | 100                                       | 51                                    
|Rent                               | 14,162                                                        | 539                                       | 550                                   
|Research and development costs     | 406,072                                                       | 1,409                                     | 773                                   
|Royalty                            | 10,004                                                        | 3,270                                     | -                                     
|Salaries                           | 20,378                                                        | -                                         | -                                     
|Telephone                          | 12,024                                                        | 541                                       | 1,013                                 
|Travel                             | 18,781                                                        | 452                                       | 1,016                                 
|                                   |                                                               |                                           |                                       
|LOSS BEFORE OTHER ITEMS            | (654,098)                                                     | (27,578)                                  | (28,100)                              
|                                   |                                                               |                                           |                                       
|OTHER ITEMS                        |                                                               |                                           |                                       
|Interest income                    | 4,615                                                         | -                                         | -                                     
|Loss on terminated proposed        |                                                               |                                           |                                       
|business acquisition               | (45,376)                                                      | -                                         | (12,728)                              
|                                   | (40,761)                                                      | -                                         | (12,728)                              
|                                   |                                                               |                                           |                                       
|NET LOSS FOR THE PERIOD            | $(694,859)
=======                                            | $(27,578)
======                          | $(40,828)
=======                     
|                                   |                                                               |                                           |                                       
|LOSS PER SHARE - BASIC AND DILUTED |                                                               | $0.00
====                                | $0.00
====                            
|                                   |                                                               |                                           |                                       
|WEIGHTED AVERAGE COMMON SHARES     |                                                               | 21,700,000
========                       | 18,466,667
========                   

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

GLOBAL INNOVATIVE SYSTEMS INC.(A Development Stage Company)



CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT (UNAUDITED)(EXPRESSED IN US DOLLARS)



|                                                              | Shares     | Amount     | Additional
Paid-in Capital | Foreign
Currency
Translation
Adjustments | Deficit
Accumulated
in the Development
Stage | Total Stockholders'
Deficit
|------------------------------------------------------------- | ---------- | ---------- | -------------------------- | ---------------------------------------- | -------------------------------------------- | ---------------------------
|                                                              |            |            |                            |                                          |                                              |                            
|Initial capitalization of the company as of  January 15, 1997 | 100        | $67        | $-                         | $-                                       | $-                                           | $67                        
|                                                              |            |            |                            |                                          |                                              |                            
|Common stock issued at $1 Cdn April 15, 1998                  | 4,900      | 3,198      | -                          | -                                        | -                                            | 3,198                      
|                                                              |            |            |                            |                                          |                                              |                            
|Total comprehensive loss, 1998                                | -          | -          | -                          | 8,588                                    | $(260,374)                                   | (251,786)                  
|                                                              |            |            |                            |                                          |                                              |                            
|Balance, September 30, 1998                                   | 5,000      | 3,265      | -                          | 8,588                                    | (260,374)                                    | (248,521)                  
|                                                              |            |            |                            |                                          |                                              |                            
|Total comprehensive loss, 1999                                | -          | -          | -                          | (14,339)                                 | (145,219)                                    | (159,558)                  
|                                                              |            |            |                            |                                          |                                              |                            
|Balance, September 30, 1999                                   | 5,000
==== | 3,265
==== | $-
==                      | $(5,751)
======                          | $(405,593)
========                          | $(408,079)
========        



The accompanying notes are an integral part of these financial statements

GLOBAL INNOVATIVE SYSTEMS INC.(A Development Stage Company)



CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT (UNAUDITED)(EXPRESSED IN US DOLLARS)



|                                                       | Common Shares       | Additional
Paid-in Capital | Accumulated Other Comprehensive Income | Deficit Accumulated in the Development Stage | Total Stockholders' Deficit
|------------------------------------------------------ | ------------------- | -------------------------- | -------------------------------------- | -------------------------------------------- | ---------------------------
|                                                       | Number              | Amount                    
|                                                       |                     |                            |                                        |                                              |                            
|Balance, September 30, 1999 - Niew Industries Inc.     |                     |                            |                                        |                                              |                            
|carried forward                                        | 5,000               | $3,265                     | $-                                     | $(5,751)                                     | $(405,593)                 
|                                                       |                     |                            |                                        |                                              |                            
|Common stock redeemed at $1 Cdn on October 31, 1999    | (2,850)             | (1,861)                    | -                                      | -                                            | 1,861                      
|                                                       |                     |                            |                                        |                                              |                            
|Adjustment for the issuance of common stock on         |                     |                            |                                        |                                              |                            
|reverse acquisition                                    | 11,997,850          | 10,596                     | -                                      | -                                            | (10,596)                   
|                                                       |                     |                            |                                        |                                              |                            
|Adjustment of debts to former stockholders of          |                     |                            |                                        |                                              |                            
|Niew Industries Inc. (Note 4)                          | -                   | -                          | 410,268                                | -                                            | 10,596                     
|                                                       | 21,700              |                            |                                        |                                              |                            
|Adjustment for the stockholders' equity of the Company |                     |                            |                                        |                                              |                            
|at the acquisition date (Note 4)                       | 9,700,000           | 9,700                      | 364                                    | -                                            | -                          
|                                                       | 21,700,000          | 21,700                     | 410,632                                | (5,751)                                      | (403,732)                  
|                                                       |                     |                            |                                        |                                              |                            
|Net loss for the year                                  | -                   | -                          | -                                      | -                                            | (240,748)                  
|Foreign currency translation loss                      | -                   | -                          | -                                      | (4,176)                                      | -                          
|Total comprehensive loss                               | -                   | -                          | -                                      | (4,176)                                      | (240,748)                  
|                                                       |                     |                            |                                        |                                              |                            
|Balance, September 30, 2000                            | 21,700,00           | 21,700                     | 410,632                                | (9,927)                                      | (644,480)                  
|                                                       |                     |                            |                                        |                                              |                            
|Net loss for the period                                | -                   | -                          | -                                      | -                                            | (48,518)                   
|Foreign currency translation gain                      | -                   | -                          | -                                      | 11,275                                       | -                          
|                                                       | -                   | -                          | -                                      | 11,275                                       | (48,518)                   
|                                                       |                     |                            |                                        |                                              |                            
|Balance, March  31, 2001                               | 21,700,000
======== | $21,700
======             | $410,632
=======                       | $(1,348)
======                              | $(692,998)
========        

The accompanying notes are an integral part of these financial statements

GLOBAL INNOVATIVE SYSTEMS INC.(A Development Stage Company)



CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)(Expressed in US Dollars)

|                                         | January 15, 1997 (Incorporation) to March 31, 2001 Cunmulative | Six months ended March 31,
|---------------------------------------- | -------------------------------------------------------------- | --------------------------
|                                         |                                                                | 2001                      
|                                         |                                                                |                           
|CASH PROVIDED BY (USED IN)               |                                                                |                           
|Operating                                |                                                                |                           
|Net loss for the period                  | $(694,859)                                                     | $(48,518)                 
|Non cash item                            |                                                                |                           
|Depreciation                             | 6,243                                                          | 866                       
|(Increase) decrease in assets            |                                                                |                           
|Receivables                              | (433)                                                          | 223                       
|Investment tax credits refundable        | -                                                              |                           
|Prepaid expenses                         | (5,023)                                                        | 4,084                     
|Increase (decrease) in liabilities       |                                                                |                           
|Accounts payable                         | 48,451                                                         | 16,129                    
|Accrued liabilities                      | 14,194                                                         | 2,732                     
|                                         | (631,427)                                                      | (24,484)                  
|                                         |                                                                |                           
|Financing                                |                                                                |                           
|Bank overdraft                           | (1,742)                                                        | (1,742)                   
|Loan payable to related party            | 31,677                                                         | -                         
|Advances from stockholders and directors | 693,071                                                        | 26,973                    
|Repayments to stockholders and directors | (72,583)                                                       | (2,828)                   
|                                         | 650,423                                                        | 22,403                    
|Investing                                |                                                                |                           
|Cash acquired on reverse acquisition     | 10,064                                                         | -                         
|Purchase of licence                      | (23,342)                                                       | -                         
|Purchase of fixed assets                 | (13,318)                                                       | -                         
|                                         | (26,596)                                                       | -                         
|                                         |                                                                |                           
|INCREASE (DECREASE) IN CASH              | 7,600                                                          | (2,081)                   
|                                         |                                                                |                           
|EFFECT OF FOREIGN EXCHANGE ON CASH       | (7,600)                                                        | 1,355                     
|                                         |                                                                |                           
|CASH AT BEGINNING OF PERIOD              | -                                                              | 726                       
|                                         |                                                                |                           
|CASH AT END OF PERIOD                    | $-
==                                                          | $-
==                     

The accompanying notes are an integral part of these financial statements



GLOBAL INNOVATIVE SYSTEMS INC.(A Development Stage Company)



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)(Expressed in US Dollars)

March 31, 2001 and 2000

1.	UNAUDITED FINANCIAL STATEMENTS

The interim financial statements for the six month periods ended March 31, 2001 and 2000 included herein have been prepared by the Company without audit, pursuant to the rules and regulations of the Securities
and Exchange Commission.  Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations,
although the Company believes that the disclosures are adequate to make the information presented not misleading.



These statements reflect all adjustments consisting of normal recurring adjustments, which, in the opinion of management, are necessary for fair presentation of the information, contained therein.  It is suggested that these interim
financial statements be read in conjunction with the financial statements of the Company for the years ended September 30, 2000 and 1999 and the notes thereto included in the Company's annual report on Form 10-KSB.  The Company follows the same accounting
policies in preparation of interim reports.



Results of operations for the interim periods are not indicative of annual results.



2.	NATURE OF BUSINESS AND ABILITY TO CONTINUE OPERATIONS

The Company was incorporated in the State of Nevada on September 14, 1995 and was inactive until January 31, 2000 when it closed a share exchange agreement with the stockholders of Niew Industries Inc. ("NIEW"
).  The transaction resulted in NIEW becoming a wholly owned subsidiary of the Company.  Since the stockholders of Niew controlled 55% of the combined entity after the merger and the business of Niew presents the only operations of the new entity, the
transaction was recorded as a reverse acquisition and Niew was considered the accounting acquirer.  As such, the historical financial information of the company is that of Niew.



NIEW was incorporated on January 15, 1997 under the British Columbia Company Act.  The Company was inactive until March 23, 1998 when it began the development of a twin rotating asphalt mixing system.  To date, this
has been Niew's only activity.  These financial statements are expressed in US dollars and have been prepared in accordance with accounting principles generally accepted in the United States.



These accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of
business.  As at March 31, 2001, the Company has accumulated operating losses of $694,859 since its inception.  The continuation of the Company is dependent upon the continuing financial support of creditors, directors and stockholders and obtaining long
term financing as well as achieving a profitable level of operations through the successful development of the twin rotating asphalt mixing system.  It is the intention of the Company to raise a new equity financing of approximately $550,000 within the
upcoming year.  Amounts raised will be used to complete the development of the twin rotating asphalt mixing system and then proceed into a stage of commercial production.  While the Company is expending its best efforts to achieve the above plans, there
is no assurance that any such activity will generate funds that will be available for operations.



These conditions raise substantial doubt about the company's ability to continue as a going concern.  These financial statements do not include any adjustments that might arise from this uncertainty.



GLOBAL INNOVATIVE SYSTEMS INC.
(A Development Stage Company)



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - Continued
(Expressed in US Dollars)



March 31, 2001 and 2000



3.   NEW ACCOUNTING PRONOUNCEMENTS







Historically, the Company has not entered into derivative contracts either to hedge existing risks or for speculative purposes.  Accordingly, adoption of the new standards did not affect its financial statements.



In 1999, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 101 dealing with the revenue recognition, which is effective in the fourth quarter of the Company's 2001 fiscal year.  The Company does not
expect its adoption to have a material effect on the Company's financial statements.



4.   ACQUISITION OF NIEW INDUSTRIES INC.



By agreement dated December 11, 1999, the Company agreed to acquire 100% of the issued and outstanding shares, and settle $420,864 owing to the stockholders, of Niew Industries Inc. in exchange for 12 million common shares of the
company.  The acquisition closed on January 31, 2000.



Effective as of the closing date, the transaction was accounted for using the purchase method of accounting as applicable for a reverse acquisition.  Following reverse acquisition accounting, consolidated financial statements
subsequent to closing of the acquisition are presented as a continuation of NIEW.  The operations of the Company are consolidated with those of NIEW from the date of the acquisition.



The net assets of the Company at the date of acquisition consisted of $10,064 of cash remaining on its initial capitalization.  No goodwill was recorded on the transaction.



Since the Company was inactive until the acquisition of NIEW, pro-forma information reflecting the acquisition had it occurred at the beginning of the earliest period presented would not yield results different from the net loss and
loss per share presented on the Consolidated Statement of Operations.



5.	LOAN PAYABLE TO RELATED PARTY



The Company has borrowed $30,449 ($47,500 Canadian) from a person related to one of the directors.  The loan is unsecured and is without specific terms of repayment.  Interest is payable at 8%.  Interest of $1,245 was either
accrued or paid during the period.



GLOBAL INNOVATIVE SYSTEMS INC.
(A Development Stage Company)



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - Continued
(Expressed in US Dollars)



March 31, 2001 and 2000





6.	ADVANCES FROM STOCKHOLDERS AND DIRECTORS



The advances are unsecured, do not bear interest and have no specific terms of repayment.  The advances are summarized as follows:







|                               | March 31, 2001   | September 30, 2000
|------------------------------ | ---------------- | ------------------
|Cash advances to the company   | $251,575         | $245,469          
|Repayments                     | (73,244)         | (70,416)          
|Reimbursable expenses          | 21,841           | 8,797             
|                               |                  |                   
|                               | $200,172
======= | $183,850
=======  
|                               |                  |                   
|Average balance for the period | $192,011
======= | $119,535
=======  





Item 2.	Management's Discussion and Analysis or Plan of Operation.

There have been no material developments since we filed our Annual Report on Form 10-KSB on January 16, 2001.

The following discussion should be read in conjunction with our financial statements and related notes appearing elsewhere in this quarterly report.  The following discussion contains forward-looking statements that reflect our
plans, estimates, assumptions and beliefs, and that involve risks and uncertainties.  Our actual results could differ materially from those discussed in such forward-looking statements.  Factors that could cause or contribute to such differences include,
but are not limited to, those discussed below and elsewhere in this quarterly report.

Plan of Operation

Our primary objective over the 12 months ending March 31, 2002, will be to complete development of Phase I and Phase II of our twin rotating asphalt mixing system (known as the "Trams System") for commercial sale, and to
implement a sales and marketing program in connection with the sale of the Trams System.

As of the present date, Phase I of the Trams System requires further development and testing before it can be commercially released.  We have not yet commenced development of Phase II of the Trans System due to a lack of capital
resources.  In addition to the development and testing work that must be performed on both Phase I and Phase II of the Trams System, a sales and marketing campaign must be implemented.

We have also acquired a license to manufacture a self-erecting silo which is different from the self-erecting silo that will be used in the Phase II of the Trams System.  Following the completion of Phase I and Phase II of the
Trams System, we intend to manufacture this self-erecting silo for commercial sale.

Further development of Phase I and Phase II of the Trams System was suspended in fiscal 2000 to devote attention to the registration of our common shares under Section 12(g) of the Securities Exchange Act of 1934 so that we could
obtain a quotation of our securities on the Over-the-Counter Bulletin Board.  Our common shares were registered under Section 12(g) of the Securities Exchange Act of 1934 in October, 2000 and we received confirmation from NASD Regulation, Inc. (OTC
Compliance Unit) that our request for an unpriced quotation on the Over-the-Counter Bulletin Board was cleared on April 3, 2001.  Our shares were quoted and began trading on the Over-the-Counter Bulletin Board on April 17, 2001 under the symbol "GBIS".

We anticipate that we will be able to complete our plan of operations if we can raise additional financing.  Our actual expenditures and business plan may differ from our plan of operations.  Our board of directors may decide not
to pursue our plan of operations as set out below.  In addition, we may modify our plan of operations based on the amount of available financing in the event that we cannot raise the required financing to complete our plan of operations.  We do not
currently have any arrangement in place for any debt or equity financing which would enable us to satisfy the cash requirements of our plan of operations.

We anticipate that we will incur further operating losses in the foreseeable future.  We base this expectation in part on the assumption that we will incur substantial operating expenses in completing our plan of operations.  Our
future financial results are also uncertain due to a number of factors, many of which are outside of our control.  These factors include, but are not limited to, the following:

(a)	willingness of external investors to advance capital to us to finance continued development and production;

(b)	general economic conditions, government environmental regulations and increased industry competition;

(c)	uncertainty with respect to whether our Trams System can:

(i)	meet new British Columbia environmental regulations;

(ii)	comply with environmental regulations in other North American jurisdictions; and

(iii)	continue to meet new regulatory requirements as they arise;

(d)	whether there will be a market for our Phase I or II Trams System once development is complete; and

(e)	whether demand for the Trams System will be adequate to support economically viable production.

Due to our lack of operating history, there exists substantial doubt about our ability to continue as a going concern, as described in our independent accountant's report on, and the notes to, the consolidated audited financial
statements for the year ended September 30, 2000.

Cash Requirements

We will require a minimum of approximately $550,000 over the period ending September 30, 2001 in order to accomplish our goals.  The cash requirements of $550,000 are based on our estimates for operational costs for the period
ending September 30, 2001.  We estimate that approximately $30,000 will be required for further development of Phase I of the Trams System, $150,000 will be required for development of Phase II of the Trams System, $120,000 will be required to hire
marketing and sales persons and to implement our planned sales and marketing program and $70,000 will be required to support an investor relations program.  The balance of $180,000 will be required to support general corporate and operating expenses.  To
date, we have not raised any monies and accordingly, we have not proceeded with any of our planned operations.

To date, our operations have been primarily financed by private loans from our directors and other related parties totalling $746,448 at March 31, 2001, as well as $95,486 of refundable Canadian government investment tax credits on
eligible research expenditures.  Since the share exchange on January 31, 2000 between Global Innovative Systems Inc. and Niew Industries Inc. resulted in Niew Industries Inc. no longer being owned by Canadians, we expect that we will no longer be eligible
for any further tax credits.

We do not have sufficient funds on hand to complete our Phase I development but we believe that we will have access to funds sufficient to complete the development and negotiate the sale of the Phase I Trams System prototype.

We intend to obtain our future cash requirements through the sale of our equity securities or by obtaining further debt financing.  In the event that we are not successful in raising additional financing, we anticipate that we will
not be able to sustain our business operations without further short-term financing from our controlling shareholders.  Deficiencies in cash will be covered by additional loans and advances by our directors until such time that we can attract equity
investors.  Should we be unable to attract equity investors, cutbacks and deferrals of the planned development of Phase I and Phase II of the Trams System would occur until such funds were otherwise available externally or from the proceeds received on
sale of Phase I of the Trams System prototype.  Alternatively, we may have to consider a joint venture in order to proceed with our plans of operations.

Research and Development

As at March 31, 2001, we have expended $406,072 (net of investment tax credits of $95,486) on direct research and development on the Trams System.  We will continue to expend a significant amount of time in the next 12 months
on research and development activities.  These activities will focus on:

(a)	further improvement of Phase I of the Trams System to make it more efficient and to ensure that it meets government standards for pollution control; and

(b)	commencement of the development of Phase II of the Trams System.

We estimate that the completion of Phase I will require approximately $30,000, consisting of $6,000 for testing, $14,000 for materials and $10,000 for labour and subcontractors.  At the completion of Phase I, we intend to sell our
prototype and use the sale proceeds to finance the construction of a second prototype of the Trams System.

The Phase II of the Trams System will consist of a second trailer which will contain a self-erecting silo and separate storage tanks to carry and store asphalt, diesel fuel and propane fuel.  We estimate that the cost of developing
and completing the Phase II plant will be $150,000, $84,000 for testing and materials, $16,000 for general corporate and overhead expenses and $50,000 for labour and subcontractors.

To date, we have not raised any monies and accordingly, we have not proceeded with any of our planned operations.

Sales and Marketing

We anticipate that the commercial version of the Trams System will consist of a package of the Phase I plant and the Phase II trailer but we also anticipate that these machines will be sold separately.  Upon completion of Phase
II, we intend to transport the Trams System plant to a gravel pit, the location of which has already been determined, and to record set up time, conduct anti-pollution equipment testing and record promotional videos.

Personnel

Over the twelve months ending September 30, 2001, should we be in a position to proceed with development of Phase II of the Trams System project, we anticipate an increase in the number of employees we retain, as we intend to
hire two more employees.

Purchase or Sale of Equipment

We do not anticipate that we will purchase any significant equipment for our present or future operations over the twelve months ending September 30, 2001.

RISK FACTORS

An investment in our common shares involves a number of very significant risks.  You should carefully consider the following risks and uncertainties in addition to other information in this quarterly report in evaluating us and
our business before purchasing shares of common stock.  Our business, operating results and financial condition could be seriously harmed due to any of the following risks.  The trading price of the shares of our common stock could decline due to any of
these risks, and you could lose all or part of your investment.

WE ARE a Development Stage Company with a Limited Operating History Which Makes IT DIFFICULT TO EVALUATE WHETHER WE WILL OPERATE PROFITABLY.

We are a development stage company primarily involved in the development, manufacture and marketing of a simplified asphalt mixing system that is intended to be compact, environmentally friendly and easy to mobilize.  We call our
product the Trams System.  As a relatively new company, we have not started selling our product, and as a result, we do not have a historical record of sales and revenues nor an established business track record.  We have not earned any revenues since our
formation.

Unanticipated problems, expenses and delays are frequently encountered in ramping up sales and developing new products.  Our ability to successfully develop, produce and sell our Trams System and to eventually generate operating
revenues will depend on our ability to, among other things:

1. successfully design, develop and market both Phase I and Phase II of the Trams System;
2. successfully develop our second prototype of the Trams System;
3. successfully develop a customer base for and market acceptance of our Trams System; and
4. obtain the necessary financing to implement our business plan and plan of operations.
5. incur unexpected costs in completing the development of our Trams System or encounter any unexpected technical or other difficulties;
6. incur delays and additional expenses as a result of technology failure;
7. are unable to create a substantial market for our Trams System; or
8. incur any significant unanticipated expenses.
9. our ability to attract and retain customers and maintain customer satisfaction;
10. our ability to develop a base of manufacturers and users of asphalt plants willing to utilize the Trams System for paving applications;
11. the announcement or introduction of new services and products by us and by our competitors;
12. an increase in consumer acceptance of the Trams System, or other systems and products offered by us;
13. our ability to upgrade and develop our Trams Systems and attract new personnel in a timely and effective manner;
14. the amount and timing of operating costs and capital expenditures relating to expansion of our business, operations and infrastructure;
15. governmental regulation;
16. general economic conditions; and
17. economic conditions specific to the asphalt manufacturing and paving industries.

BECAUSE OF THE TYPE OF INDUSTRY WE ARE INVOLVED IN, WE EXPECT TO EXPERIENCE SEASONALITY IN OUR BUSINESS.

We expect that we will experience seasonality in our business, reflecting a combination of seasonal fluctuations in construction and paving projects' seasonality patterns.  Due to the foregoing factors, one or more future quarters
our operating results may fall below the expectations of securities analysts and investors.  In such event, our financial performance would likely be materially adversely affected.

WE WILL HAVE TO EXPEND SUBSTANTIAL FUNDS ON ADVERTISING, SALES AND MARKETING IN THE FUTURE.

We have not incurred significant advertising, sales and marketing expenses to date.  To increase awareness for the Trams System, we expect to spend significantly more on advertising, sales and marketing in the future. If our
marketing strategy is unsuccessful, we may not be able to recover these expenses or even generate any revenues.  We will be required to develop a marketing and sales campaign that will effectively demonstrate the advantages of our, services and products.
To date, our experience with respect to marketing the Trams System is very limited.  We may also elect to enter into agreements or relationships with third parties regarding the promotion or marketing of the Trams System.  There can be no assurance that
we will be able to establish adequate sales and marketing capabilities, that we will be able to enter into marketing agreements or relationships with third parties on financially acceptable terms, or that any third parties with whom we enter into such
arrangements will be successful in marketing and promoting the Trams System, or other products and services offered by us.

OUR FUTURE REVENUES ARE DEPENDENT ON THE ACCEPTANCE OF THE TRAMS SYSTEM.

Our future revenues and our ability to generate profits in the future are substantially dependent upon the widespread acceptance and use of the Trams System.  There can be no assurance that acceptance and use of the Trams System
will develop or that a sufficiently broad base of consumers will use the Trams System.

We will rely on manufacturers and users of asphalt plants who have historically used traditional means for asphalt manufacturing.  To ensure our success, these manufacturers and users of asphalt plants must accept and utilize our
novel Trams System.  In addition, the Trams System may not be accepted as a viable alternative to traditional asphalt manufacturing processes for a number of reasons, including potentially inadequate development of the necessary infrastructure or delayed
development of related technologies and performance improvements.

WE EXPECT TO ENCOUNTER RISKS IF WE ENTER INTO NEW BUSINESS AREAS.

We may choose to expand our operations by improving the Trams System or even developing new systems for the asphalt industry or expanding our market presence through relationships with third parties.  In addition, we may pursue the
acquisition of new or complementary businesses, products or technologies, although we have no present understandings, commitments or agreements with respect to any material acquisitions or investments.  There can be no assurance that we would be able to
expand our efforts and operations in a cost-effective or timely manner or that any such efforts would increase overall market acceptance.

Expansion of our operations in this manner would also require significant additional expenses and development, operations and editorial resources and may strain our management, financial and operational resources.  The lack of
market acceptance of such efforts or our inability to generate satisfactory revenues from such expanded services or products to offset their cost could have a materially adverse effect on our business, prospects, financial condition and results of
operations.

THERE MAY BE THE POSSIBILITY OF VOLATILE SHARE PRICES.

The trading price of our common shares may be subject to wide fluctuations.  Trading prices of the common shares may fluctuate in response to a number of factors, many of which are beyond our control. In addition, the stock market
in general has experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of such companies.  Broad market and industry factors may adversely affect the market price of the common
shares, regardless of our operating performance.

In the past, following periods of volatility in the market price of a company's securities, securities class-action litigation has often been instituted.  Such litigation, if instituted, could result in substantial costs for us and
a diversion of management's attention and resources.

OUR CURRENT AND FUTURE SHAREHOLDERS MAY EXPERIENCE DILUTION IN THE FUTURE.

The grant and exercise of warrants of creditors or otherwise or stock options would likely result in a dilution of the value of our common shares.  Moreover, we may seek authorization to increase the number of our authorized shares
and to sell additional securities and/or rights to purchase such securities at any time in the future.  Dilution of the value of the common shares would likely result from such sales.

Part II - OTHER INFORMATION

Item 1.	Legal Proceedings.

We are not a party to any pending legal action, suit, or proceeding nor is any of our property the subject of any legal proceeding.  There are no proceedings in which any of our directors, officers or affiliates, or any
registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

Item 2.	Changes in Securities.

We did not issue any shares from treasury during the quarter ended March 31, 2001.

Item 3.	Defaults Upon Senior Securities.

None.

Item 4.	Submission of Matters to a Vote of Security Holders.

None.

Item 5.	Other Information.

None.

Item 6.	Exhibits and Reports on Form 8-K.

Reports on Form 8-K

We did not file any Reports on Form 8-K during the quarter ended March 31, 2001.

Exhibits

Exhibits Required by Item 601 of Regulation S-B

(3)	Articles of Incorporation and By-laws

3.1	Charter (filed as an exhibit to our Registration Statement on Form 10SB on April 11, 2000, and incorporated herein by reference)

3.2	Articles of Incorporation (filed as an exhibit to our Registration Statement on Form 10SB on April 11, 2000, and incorporated herein by reference)

3.3	Bylaws (filed as an exhibit to our Registration Statement on Form 10SB on April 11, 2000, and incorporated herein by reference)



SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

GLOBAL INNOVATIVE SYSTEMS, INC.

By: /s/ Helge FreudentheilHelge Freudentheil, President/Director
Date: May 14, 2001

By: /s/ Ken Bergestad
Ken Bergestad, Vice President/Director
Date: May 14, 2001

By: /s/ Walter Niemi
Walter Niemi, Secretary/Treasurer/Director
Date: May 14, 2001

By: /s/ Robert Stark
Robert Stark, Vice President/Director
Date: May 14, 2001