U. S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                  FORM 10-KSB/A

        Amendment No.1 to the Annual Report Under Section 13 or 15(d) of
                       The Securities Exchange Act of 1934

     December 31, 2000                                   0-11353
   (For the year ended)                             (Commission File No.)

                           CIRCUIT RESEARCH LABS, INC.

          Arizona                                      86-0344671
State or other jurisdiction of              (IRS Employer Identification No.)
incorporation or organization

                     Address of principal executive offices:
                   2522 West Geneva Drive Tempe, Arizona 85282
--------------------------------------------------------------------------------
                   Registrant's Telephone No.  (602) 438-0888
--------------------------------------------------------------------------------

           Securities registered pursuant to Section 12(b) of the Act:
                                      None

           Securities registered pursuant to Section 12(g) of the Act:
                          Common Stock, $.10 Par Value

Check whether the issuer: (i) has filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months, and (ii) has
been subject to such filing requirements for the past 90 days.
                                 YES X       NO

Check if disclosure of delinquent filers in response to Item 405 of Regulation
SB 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]

The registrant's revenues for fiscal 2000 were $7,259,910.

The aggregate market value of the voting stock of the registrant held by
non-affiliates of the registrant on March 30, 2001, based on the closing sales
price for such stock in the Over-the-Counter market as reported by NASDAQ on
such date was $4,694,723.

At March 30, 2001,  2,296,022 shares of the registrant's common stock were
issued and outstanding.


                      Exhibit Index located on page Three.


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<PAGE>
                           CIRCUIT RESEARCH LABS, INC.

                              Explanatory Statement

     By this amendment, the registrant is revising and refiling Exhibit 13 to
the registrant's Annual Report on Form 10-KSB for the fiscal year ended December
31, 2000.  The said Exhibit 13 is the registrant's "2000 Annual Report to
Security Holders," which includes the registrant's 2000 consolidated financial
statements.  As discussed in Note 10 to the consolidated financial statements
included in Exhibit 13 included in this amendment, the accompanying 2000
consolidated financial statements have been restated.

     Portions of the registrant's December 31, 2000 Annual Report to Security
Holders is incorporated by reference in Item 1 of Part I, Items 5, 6 and 7 of
Part II, and Item 13 of Part III and are hereby amended.


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<PAGE>
                           CIRCUIT RESEARCH LABS, INC.

ITEM 13 - EXHIBITS AND REPORTS ON FORM 8-K

The following consolidated financial statements of Circuit Research
Labs, Inc. and subsidiaries are included in the annual report of
the registrant to its stockholders for the year ended December 31,
2000 Exhibit 13 hereto and are incorporated by reference from Item
7:

     Consolidated balance sheets - December 31, 2000 (restated) and 1999.
     Consolidated statements of operations - Years ended December 31, 2000
       (restated) and 1999.
     Consolidated statements of stockholders' equity - Years ended December 31,
       2000 (restated) and 1999.
     Consolidated statements of cash flows - Years ended December 31, 2000
       (restated) and 1999.
     Notes to consolidated financial statements - Years ended December 31, 2000
       and 1999.

                                  Exhibit Index
(a)  Exhibit No.

     3    Articles of Incorporation as Amended and Bylaws previously filed and
          incorporated herein by reference (1).

     4.1  Warrant to Orban, Inc., dated May 31, 2000, previously filed on Form
          8-K/A on October 12, 2000 and incorporated herein by reference.

     4.2  Form of Stock Purchase Warrant dated May 30, 2000 (2).

     10.1 Stock Option Plan previously filed and incorporated herein by
          reference (1).

     10.2 1994 Stock Option Plan previously filed on Form S-8 on July 26, 1994
          and incorporated herein by reference.

     10.3 Asset Purchase Agreement between CRL Systems, Inc., a wholly-owned
          subsidiary of the Company and Orban, Inc., a wholly-owned
          subsidiary of Harman International Industries Inc. previously filed
          on Form 8-K/A on October 12, 2000 and incorporated herein by
          reference.

     10.4 Employment Agreement dated June 23, 1999 between Gary D. Clarkson and
          the Company (2).

                                        3
<PAGE>

     10.5 Employment Agreement dated May 31, 2000 between Robert A. Orban and
          the Company (2).

     10.6 Employment Agreement dated March 9, 2001 between Charles Jayson
          Brentlinger and the Company (2).

     10.7 Employment Agreement dated March 9, 2001 between James Seemiller, ATB
          Broadcasting Corporation and the Company (2).

     13   2000 Annual Report to Security Holders (filed with this amendment
          No.1)

     21   Subsidiaries of the Registrant (2).

     23   Consent of Deloitte & Touche LLP - (filed with this amendment No. 1).

             (1)  Incorporated by reference from the Company's Registration
                  Statement on Form S-18 which was effective October 14, 1983,
                  and subsequent filings in a timely manner.
             (2)  Previously filed with the Registrant's Form 10-KSB for the
                  fiscal year ended December 31, 2000


(b)  Reports on Form 8-K

      (a) Exhibits included herein: none

      (b) Reports on Form 8-K      Form 8-K filed on January 7, 2000
                                   Form 8-K filed on June 15, 2000
                                   Form 8-K filed on August 14, 2000
                                   Form 8-K/A filed on October 12, 2000
                                   Form 8-K/A filed on November 21, 2000


                                        4
<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.

                                 CIRCUIT RESEARCH LABS, INC.
                                 Registrant
Date:  May 21, 2001              By     /s/ Charles Jayson Brentlinger
                                 Charles Jayson Brentlinger, Chief Executive
                                 Officer and Chairman of the Board

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.

Date:  May 21, 2001              By     /s/ Charles Jayson Brentlinger
                                 Charles Jayson Brentlinger, Chief Executive
                                 Officer and Chairman of the Board

Date:  May 21, 2001              By     /s/ Gary D. Clarkson
                                 Gary D. Clarkson, Secretary and Treasurer,
                                 Vice President and General Manager

Date:  May 21, 2001              By     /s/ Carl E. Matthusen
                                 Carl E. Matthusen, Director

Date:  May 21, 2001              By     /s/ Robert A. Orban
                                 Robert A. Orban, Director and Chief Engineer

Date:  May 21, 2001              By
                                 Phillip T. Zeni, Director

Date:  May 21, 2001              By     /s/ James Seemiller
                                 James Seemiller, Chief Financial Officer,
                                 Vice President of Sales, Marketing and
                                 New Business Development

Date:  May 21, 2001              By     /s/ Robert McMartin
                                 Robert McMartin, Controller


                                        5
<PAGE>
                                   Exhibit 13
                     2000 Annual Report to Security Holders

CIRCUIT RESEARCH LABS, INC.

CORPORATE PROFILE

Circuit Research Labs, Inc. (the "Company" or "CRL") is an electronics
company developing, manufacturing and marketing high quality audio
processing and transmission encoding equipment for the radio, television
and professional audio markets worldwide.

The Company's main product lines control the audio quality and range of
radio and television audio reception including generators that allow
radio and television stations to broadcast in stereo.  Professional sound
reinforcement and digital audio test equipment is also produced creating
a wide range of applications.

SELECTED FINANCIAL INFORMATION

                                         Years Ended December 31
                            2000 [A]     1999       1998       1997       1996
                          (restated)
Operating Highlights
Net sales                 $7,259,910 $1,016,807 $1,516,613 $1,953,521 $2,524,870
Other income                  18,170     38,078  1,033,940     11,184     16,860
                           ---------  ---------  ---------  ---------  ---------
Total revenues             7,278,080  1,054,885  2,550,553  1,964,705  2,541,730
Net (loss) income         (2,258,121)  (260,229)     9,011   (262,296)   123,160
Net (loss) income per
   Common share - basic
   and diluted                ($1.28)    ($0.28)     $0.01     ($0.22)     $0.10
Weighted average number
   of common shares
   outstanding-basic and
   diluted                 1,770,625    916,940    948,788  1,195,364  1,195,364

Balance Sheet Highlights

Current assets            $4,435,549 $1,095,588 $1,098,837 $1,263,249 $1,431,175
Current liabilities        2,287,083    150,479    160,007    195,746    239,811
Total assets              13,058,888  1,834,691  1,532,574  1,846,598  2,169,590
Long-term obligations      8,738,466          0          0    105,656    122,287
Total liabilities         11,025,549    150,479    160,007    301,402    362,098
Stockholders' equity       2,033,339  1,684,212  1,372,567  1,545,196  1,807,492
No cash dividends have
   been declared.

Key Statistics

Current ratio                   1.94       7.28       6.87       6.45       5.97
Working capital           $2,148,466   $945,109   $938,830 $1,067,503 $1,191,364
Order backlog             $1,869,408    $20,200    $53,785   $138,570   $228,350
Employees                         88         17         22         24         35

[A] See note 10 to the consolidated financial statements

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<PAGE>
Circuit Research Labs, Inc.
2522 W.Geneva Drive
Tempe, Arizona 85282

Dear Shareholders,

The past year was one of the most exciting in Circuit Research Labs
history, with the purchase on May 31, 2000 of Orban from Harman
International Industries.

For the past 25 years Orban has been the market leader in Audio
Processing for Radio, Television, and now for the Internet.  Combining
the two companies while challenging has been rewarding. Both companies
share very similar backgrounds having been competitors for many years.

With the combined strengths of both companies we enter into this new
millennium as the dominant leader and producer of Audio Processing for
the Broadcast Industry.  We have very conservatively estimated our market
share as 70% worldwide and almost 80% in the United States, thanks to the
Orban Optimod product line.  In the 26 years since it's introduction the
name OPTIMOD FM has stood for quality and instant recognition from Radio
and Television professionals worldwide.

Our goal over the next year is to grow our combined company, with many
new models targeted to additional new markets.  Orban / CRL will
introduce our Opticodec line of Digital Encoders and Decoders later this
month at the National Association of Broadcasters Convention in Las
Vegas.  This new product line gives Orban / CRL our first Digital
Transmission System for the use over the Internet as well as ISDN, ATM
and Frame Relay phone lines with it's TCP/IP address ability.

The combined operation of Orban / CRL provides many new products and
product lines. The efficiencies of scale and management will reduce
operational expenses of both companies. With the addition of Bob Orban,
co-founder of Orban, to our Board of Directors, and our superstar
management team additions of Jim Seemiller Vice President / CFO
overseeing Sales and Marketing, Greg Ogonowski, Vice President of Product
Development, Bill Devitt, Vice President of Manufacturing and Production,
Robert McMartin as Company Controller and Henk Mensinga as Director of Sales,
we now have the team to grow, operate efficiently and make it all work.

Our working relationship with Harman International made the Orban
purchase possible, and has allowed Orban / CRL the ability to extend the
credit terms beyond the original contractual obligations.  Our current
understanding with Harman will result in a restructuring of both short
and long-term debt. This will be possible after holders of the private
placement shares exercise their options, which total over $6.0 million,
if all the warrants are exercised.  The majority of these funds would be
used to reduce the Harman debt along with providing Orban / CRL with
additional cash reserves.

                                        2
<PAGE>
Harman International Industries, Inc. also holds warrants for shares in
CRLI, which may be used to reduce both the short and long-term debt.
Possible marketing opportunities for Orban / CRL are being explored with
Harman's Studer Division for marketing in North America.

Product development is moving forward with many new models and products
being introduced and older products getting updated and redesigned.
Orban has introduced it's Optimod 8200 Signature Series to celebrate 10
years of being the first and most successful Digital Audio Processor. The
introduction of this model was so well received by the market, production
for the next six months sold out in one day.

Sales of both Orban and CRL models are at all time record highs. Optimod
8400 sales have been higher since it's introduction than any previous
model in Orban's history, topping over $ 4.0 million since it's shipments
began in September 2000.  CRL has begun worldwide marketing of it's Amigo
Series of audio processing for Radio and Television stations with great
results. CRL is also introducing its New Upgraded Millennium Series of
Digital Audio Processors in Las Vegas later this month.

Orban and CRL have always been well respected for innovative and quality
broadcast equipment solutions. With even more models being introduced in
the next few months.

As for our future, I believe we are embarking on the greatest period of
growth in our history. Our future in broadcast equipment manufacturing is
the brightest it's ever been.
Our company wide mission is to expand into additional broadcast product
markets, while not losing track of our core business, Audio Processing.

Sincerely,

/s/ Charles Jayson Brentlinger
Charles Jayson Brentlinger
President, CEO, Chairman
Circuit Research Labs, Inc.
CRL Systems, Inc. Nevada dba: Orban
CRL International, Inc.

                                        3
<PAGE>
Corporate Overview

Founded in 1974 as broadcast industry consultants, CRL built upon its
understanding of the broadcast industry's needs by expanding into product
development and manufacturing. In 1978, the Company was incorporated and,
in late 1983, became registered as a public company on the NASDAQ stock
exchange. Until March 31, 1998, Circuit Research Labs, Inc. was listed on
the NASDAQ Small Cap market.

Since the first product, which was designed to improve the "coverage and
quality" of low powered AM radio stations, CRL has been committed to
improving broadcast quality. CRL's product lines have grown to include
digital and analog audio processing and encoding devices for monaural or
stereo AM or FM radio, international short-wave and mono or stereo
television and audio analyzers. These products are labeled "CRL Systems".

CRL is dedicated to serving the audio processing needs of the broadcast
and professional audio markets with the highest quality products
utilizing state-of-the-art technology. In order to prevent dependency on
one market, when appropriate, consultants, licensing of technology and
acquisition of product lines are also used to diversify operations.  CRL
also encourages product engineering and development for other
complementary broadcast manufacturers.  An example is the development of
a digital audio analyzer.

CRL's production capabilities are being improved and new marketing
concepts are being developed to provide increased market share. Trusting
in dealers internationally and domestically for final product
distribution, the CRL marketing and sales staff works directly in sales
efforts with potential customers along with and for its dealers.
Supported by an efficient customer service department, CRL maintains a
reputation for excellent business ethics and selling standards.

Corporate Strategy

On May 31, 2000, CRL Systems acquired the net assets of Orban, Inc., a
wholly-owned subsidiary of Harman International Industries, Inc. (NYSE:
HAR). Including the $500,000 previously paid to Orban in 1999, the total
stated purchase price was $10.5 million, $2 million of which was paid in
cash, the balance a combination of short-term and long-term seller
financing.  In order to raise the cash necessary for the purchase, the
Company sold approximately $1,171,000 in common stock through a private
placement, the Company's majority shareholder, Charles Jayson
Brentlinger, advanced $150,000 to the Company, and the Company's Tempe,
Arizona office building was mortgaged for $335,000. The seller financing
consists of a $5 million long-term (Tranche A) and a $3.5 million short-
term (Tranche B) note to Orban, Inc. The Asset Sale Agreement between CRL
Systems and Orban, Inc. ("the Asset Sale Agreement") contains a provision
to allow Orban to rescind the transaction if, as of November 30, 2000,
CRL Systems has not paid in full the $3.5 million short-term note. If
Orban exercises its option to rescind the agreement, it is to return
$9,250,000 of the cash purchase price to CRL Systems, with the difference
due to Orban as liquidating damages. The note has since been extended to
April 30, 2002 with Orban retaining the option to rescind the agreement.

                                        4
<PAGE>
The Company has received several extensions on the Tranche A and B notes.
First, in exchange for $150,000 cash and an increase in the interest
rates to 12 percent per annum for both the Tranche A and Tranche B notes,
Harman extended the maturity date of the Tranche B note to November 30,
2000. The maturity date of the Tranche B note has subsequently been
extended several times without fees or other significant changes to the
original terms of the note and is now due in full on April 30, 2002.
Also, the first principal payment on the Tranche A note of $250,000,
originally due March 31, 2001, has been extended to September 30, 2001
with the quarterly principal payments deferred until April 30, 2002.
Interest only payments are payable monthly for both notes.

In addition to the stated purchase price, CRL issued to Orban, Inc.
warrants to purchase 1,000,000 shares of its common stock, immediately
exercisable for $2.25 per share.  The warrants have a 3-year term, and
can be exercised either in cash or by reducing the unpaid principal
amount of the $5 million long-term note, or in any combination thereof.
The Company obtained an independent valuation of the warrants in November
2000, which valued the warrants at $1,050,000. When combined with the
cash purchase price, this results in a total purchase price of Orban's
assets of  $11,550,000.

As  part of the acquisition, CRL Systems purchased the rights to the name
"Orban" and currently operates a portion of its business under the trade
name "Orban".

Based in San Leandro, California, Orban is a leading manufacturer of
audio processing for radio and TV stations worldwide. Orban has
approximately 77 employees and net sales of approximately $6.5 million
for the seven months ended December 31, 2000.  CRL will retain the Orban
brand and employees, including founder and chief engineer Bob Orban.

The management of the Company believes this business combination is
highly complementary and synergistic, since roughly 80% of Orban's
products are digital and approximately 80% of CRL's products are analog.
The acquisition positions the Company to offer a full range of digital
and analog audio processing solutions at many price points.

The Broadcast Industry and CRL

CRL was a major participant in the National Radio Systems Committee
(NRSC) which developed standards for AM stations adopted by the FCC.
During 1987, CRL developed and produced equipment enabling AM stations to
meet certain NRSC standards and continues to be a market leader in AM
processing.

CRL is a member of the National Association of Broadcasters (NAB).  The
NAB is the world's largest, most extensive broadcaster's association,
offering a wide variety of services to radio and television stations, as
well as organizations that provide products and/or services to the
broadcast industry.

CRL holds several patents on component designs for CRL products within
the broadcast industry.

                                        5
<PAGE>
Circuit Research Labs, Inc.'s Principal Products

Audio Processing Products

Audio processing equipment produced by our company is used by radio and
television stations, Internet webcasters, entertainers and recording
studios.  Audio processing is a complex technology, but put in simple
terms, our audio processing products control what an audio broadcast
sounds like to the listener. For example, audio processing controls the
amount of bass and treble heard by the listener. Another important
feature of audio processing is controlling the volume, or loudness of the
broadcast. Most audio programming constantly varies in volume. Our audio
processing equipment removes these loudness variations so radio listeners
and TV viewers do not have to constantly adjust the volume of their radio
and TV sets.

Most governments throughout the world require radio and television
broadcast stations to control their signal's modulation level and
occupied bandwidth. Radio and television stations utilize some type of
audio processing to comply with these governmental regulations.
Approximately 10,800 AM and FM stations in the United States use audio
processing, as well as more than 19,000 radio stations in other
countries.  Of the approximately 1,600 television stations in the United
States, about two-thirds of them now broadcast in stereo, which requires
audio processing.  Based on replacement equipment orders, we estimate
that the average useful life of audio processing equipment is less than
five years.  Other products are appropriate for the audio processing
needs of the Internet, recording and performing industries.

Our Orban division manufactures audio processing equipment, primarily
using digital technology, under the Orban, Optimod, Audicy and OptiCodec
brands. Our CRL division also manufactures audio processing equipment,
primarily using analog technology, under the CRL, Millennium, TVS and
Amigo brand names. The combined product line can be separated into four
different series or product families, FM Series, AM Series, TV Series and
Other.

FM SERIES

Optimod-FM 8400 is the Company's "flagship" digital audio processor
introduced in the summer of 2000. It is based on DSP (Digital Signal
Processing) technology that is five times more powerful than its
predecessor, the Optimod-FM 8200.

Optimod-FM 2200 is based on technology in Orban's Optimod-FM 8200 and
offers the benefits of digital processing to stations with a modest
budget.

Optimod-FM 8200 Signature Series is an upgraded version of the Optimod-FM
8200, Orban's widely used digital processor, which was first introduced
in 1991.

Other Optimod-FM Products include the 8218, a digital FM stereo encoder,
and the 8200ST studio chassis.

CRL Amigo-FM is a complete "one box" audio processing solution for small
to mid-size radio stations on a tight budget.

                                        6
<PAGE>
Other CRL FM Products include the Millennium, a complete digital audio
processor, the SG-800A Stereo Generator and the SCA-300B Subcarrier
Generator.

AM SERIES

Optimod-AM 9200 is our top of the line digital audio processor for
monaural AM radio stations throughout the world.

Optimod-HF 9200 is a complete digital audio processor designed for the
demanding requirements of short-wave broadcasting and "all-talk" AM radio
stations that are experiencing nighttime interference problems.

Optimod-AM 9100B2 is a complete audio processor for stereo AM radio
stations.

CRL Amigo-AM is complete audio processing solution for small to mid-size
radio stations on a tight budget.

Other CRL AM Products include the AM-4 Monaural audio processing system
and the MBL-100.


TELEVISION SERIES

Optimod-TV 6200 is our top of the line digital audio processor for 2-
channel (left and right audio channels) digital television transmissions
(DTV).  It is compatible with all digital television applications,
including conventional land-based, cable or satellite distribution of
mono, two-channel or Dolby Surround Sound programs.

Optimod-TV 8282 is a digital audio processor designed for television
audio, whether mono, stereo or dual-language, and is compatible with all
monaural and stereo broadcast systems.

Other Optimod-TV Products include the Optimod-TV 8182A, an analog audio
processor for both stereo and monaural television, the Optimod-TV 8185A,
a television stereo generator, the Optimod-TV 8182A SAP Generator
(Secondary Audio Program, primarily designed for public second language
usage), the Optimod-TV 8185A PRO Generator (PROfessional channel for non-
public use) and the 275A Automatic Stereo Synthesizer which improves the
sound of mono programs when heard on stereo or surround TV systems.

CRL TVS Processors include the TVS-3001, a top of the line stereo
television processor, the TVS-3003, a stereo TV generator, the TVS-3004,
a Professional Channel (PRO) subcarrier generator and the TVS-3005, a
secondary audio program (SAP) channel generator.

CRL Amigo-TV is a complete audio processing solution for a variety of
monaural television applications.

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<PAGE>
OTHER PRODUCTS

Optimod 6200S is our top of the line digital audio processor for Internet
Webcasters.

Optimod-DAB 6200 is the first audio processor designed specifically for
digital radio broadcasting (DAB).

Audicy brand. Orban manufactures and sells digital audio production and
video post-production workstations under the AUDICY brand.  The
workstations feature a very easy to learn set of controls and features to
reduce our customer's training costs.

OptiCodec brand. We announced the introduction of a new line of codecs in
October 2000, which are being sold under the OptiCodec brand. Codec is a
word coined from the verbs "enCOde" and DECode" and stands for a
technology utilized in the transfer of digital data. The OptiCodecs will
allow our customers to send high quality digital audio over the Internet,
computer networks and special ISDN telephone lines (ISDN stands for
Integrated Services Digital Network).

Other CRL and Orban Products include stereo and mono gain controllers,
stereo spatial enhancers, test and analysis tools, studio chassis, and
other products related to the audio processing equipment.

                                        8
<PAGE>
CIRCUIT RESEARCH LABS, INC.

MANAGEMENT'S DISCUSSION AND ANALYSIS
YEARS ENDED DECEMBER 31, 2000 AND 1999

RESULTS OF OPERATIONS
The following tables set forth financial information for each of the four
quarters of the year ended December 31, 2000 and for the years ended
December 31, 2000 and 1999.

                                           2000 Quarters Ended
                               March 31      June 30 September 30  December 31

Net sales                      $208,068   $1,039,679   $3,111,152   $2,901,011
Other income                     16,211          736          234          989
                                 ------          ---          ---          ---
Total revenues                 $224,279   $1,040,415   $3,111,386   $2,902,000
                                =======    =========    =========    =========
Gross profit on net sales      $117,081     $483,604   $1,474,229     $842,346
Gross profit percent              56%          47%          47%          29%
Net loss                      ($206,848)   ($455,233)   ($500,110) ($1,095,930)
Net loss percent of net
  sales                           99%          44%          16%          38%
Loss per share - basic and
  diluted                       ($0.17)      ($0.29)      ($0.24)      ($0.50)


                                          Years Ended December 31
                                                2000         1999

Net sales                                 $7,259,910   $1,016,807
Other income                                  18,170       38,078
                                              ------       ------
Total revenues                            $7,278,080   $1,054,885
                                           =========    =========
Gross profit on net sales                 $2,917,260     $775,511
Gross profit percent                           40%          76%
EBITDA (1)                                  (615,573)    (264,446)
Net loss                                 ($2,258,121)   ($260,229)
Net loss  percent of net sales                 31%          26%
Loss income per share - basic and
  diluted                                    ($1.28)      ($0.28)

(1) EBITDA is defined as operating loss before depreciation and
amortization.

On May 31, 2000 the Company acquired the net assets of Orban, Inc., which
were $5,134,000 at December 31, 1999.   The net assets of the Company at
December 31, 1999 were $1,684,000. The revenues for Orban for the year
ended December 31, 1999 as reported in the 8-K/A filed November 21, 2000
were $12.4 million compared to revenues for the Company for the same
period of $1.0 million.  Accordingly, due to the consolidation of Orban's
operations into the Company's beginning May 31, 2000, period to period
comparisons of results of operations may not be meaningful.

                                        9
<PAGE>
Subsequent to the issuance of the Company's 2000 financial statements and
the filing of the Company's annual report on Form 10-KSB, the Company's
management determined that sales totalling $275,060 that was recorded in
2000 should have been reversed due to their subsequent return by the
customer in the first quarter of 2001.  As a result, the 2000 financial
statements have been restated from the amounts previously reported to
reflect the reversal of this sale (see note 10 to the financial
statements).

The following discussion and analysis has been modified to reflect the
changes resulting from the restatement.

Net sales in 2000 were $7.3 million compared to $1.0 million for 1999.
Included in the net sales for 2000 are $6.5 million in revenues for the
sale of Orban products for the seven months ended December 31, 2000.
Sales under the CRL division decreased by 30% due to a slow down in
demand for the division's audio processing equipment, in both the
domestic and international markets.

Cost of goods sold in 2000 was $4.3 million compared to $241,000 in 1999
and gross profit in 2000 was $2.9 million compared to $776,000 in 1999.
Each of these increases was attributable to the Company's acquisition of
the Orban assets on May 31, 2000.  Gross profit as a percentage of
revenues decreased to 40% in 2000 as compared to 76% in 1999.  The
decrease is a result of valuation reserves placed on inventory held at
the CRL division in 1998. In the fourth quarter of 1999, $303,000 in
valuation reserves were reversed once the Company resumed production and
certain inventory items reserved for at December 31, 1998 were sold.
This led to an unusually high margin in 1999 compared to previous years.
In addition, ninety percent of the current year sales were attributable
to Orban products, which have historically had lower gross profit
percentages than products from the CRL division.

Selling, general and administrative expense ("SG&A") in 2000 was
$2,480,000, an increase of 204% over the $817,000 reported in 1999. As a
percentage of net revenue, SG&A decreased from 80% in 1999 to 34% in
2000. The increase in SG&A expense is due in part to the variable
component of SG&A (commissions and other domestic and international sales
and marketing expenses) associated with the increase in revenues
following our acquisition of the Orban assets. The fixed component of
SG&A has also increased due to the additional personnel in sales and
marketing and administration and cost related to operating the Orban
business following the May 31, 2000 acquisition.

Research and development expense was $1,052,000 in 2000, an increase of
372% over $223,000 in 1999. The increase resulted from both an increase
in the number of engineering staff at CRL and research and development
activities at Orban, which we continued at pre-acquisition levels.

Other expense for the year ended December 31, 2000 was $759,000, of which
$638,000 represents interest and fees paid to Harman in connection with
the seller carry-back loan that financed a portion of our purchase of the
Orban assets. In 1999, CRL did not incur any interest expense.

Operationally, the Company is reporting a $616,000 loss before interest,
taxes, depreciation and amortization (EBITDA) that represents 27% of the
net loss of $2,258,000 in 2000 as compared to 1999 where the negative
EBITDA of $264,000 represented 102% of the $260,000 net loss. This is
primarily due to the amortization of goodwill and the interest expense
incurred by acquisition of Orban.

                                       10
<PAGE>
FINANCIAL POSITION

Net cash provided from operating activities in 2000 was $346,000 as
compared to a use of cash by operating activities of $673,000 during
1999.  The difference is primarily accounted for as a result of the
increase in non-cash expense items of depreciation and amortization and
the Company's increase in payables.

Net cash used in investing activities of ($2,235,000) primarily reflects
cash used for the acquisition of Orban in 2000.  In 1999, the net cash
used primarily reflects capital expenditures and equity investments.

Net cash provided by financing activities was $2,099,000 in 2000 and
included proceeds from the issuance of common stock related to the
private placement and proceeds from debt.


WORKING CAPITAL

Working capital at December 31, 2000 was $2.1 million compared to
$945,000 at December 31, 1999.

During the fiscal year ending December 31, 2001, the Company's principal
working capital requirements are to pay normal recurring operating costs.
Management believes that these requirements can be met from the operating
cash flows. In addition the Company has $483,000 of debt payments due by
December 31, 2001.  The Company's President, Mr. Charles Jayson
Brentlinger, has committed to exercise his options if necessary to
satisfy the Company's debt payment requirements, if operating cash flows
are inadequate.

                                       11
<PAGE>
CIRCUIT RESEARCH LABS, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS
YEARS ENDED DECEMBER 31, 1999 AND 1998

RESULTS OF OPERATIONS

The following tables set forth financial information for each of the four
quarters of the year ended December 31, 1999 and for the years ended
December 31, 1999 and 1998.


                                             1999 Quarters Ended
                               March 31      June 30 September 30  December 31

Net sales                      $374,293     $274,683     $196,000     $171,831
Other income                     13,608        6,619        7,795       10,056
                                 ------        -----        -----       ------
Total revenues                 $387,901     $281,302     $203,795     $181,887
                                =======      =======      =======      =======

Gross profit on net sales      $130,626     $ 64,031     $ 88,486     $492,368
Gross profit percent              35%          23%          45%         287%

Net (loss) income             $(170,524)    $(56,295)   $(134,273)    $100,863
Net (loss) income
  percent of net sales           (46%)        (20%)        (69%)         59%

(Loss) income per share -
  basic and diluted             $(.21)       $(.07)       $(.16)       $.08


                                          Years Ended December 31
                                              1999         1998

Net sales                                 $1,016,807   $1,516,613
Other income                                  38,078    1,033,940
                                              ------    ---------
Total revenues                           $ 1,054,885   $2,550,553
                                           =========    =========

Gross profit on net sales                   $775,511     $247,528
Gross profit percent                           76%          16%
EBITDA (1)                                 $(264,446)   $(780,509)
Net (loss) income                          $(260,229)      $9,011
Net (loss) income percent of net sales        (26%)         .1%
(Loss) income per share - basic and diluted  $(.28)       $ .01

(1) EBITDA is defined as operating income (loss) before depreciation and
amortization.

                                       12
<PAGE>
The primary factor affecting the results of the Company's 1999 operations
compared to 1998 was the  Board of Directors' proposed dissolution of the
Company. Production was stopped and personnel were terminated in
anticipation of the dissolution. Following the sale of stock on September
30, 1999 to Charles Jayson Brentlinger, the Board of Directors voted not
to dissolve the corporation, production was resumed and new personnel
were hired. The decrease in sales was a direct result of customers not
buying the Company's products due to the proposed dissolution. Net sales
in 1999 decreased 33% to $1,017,000 as compared to $1,517,000 for 1998.

Cost of goods sold in 1999 was 24% of net sales compared to 84% in 1998.
The improvement was due to the change in inventory obsolescence reserves.
The inventory obsolescence reserve expensed in 1998 was $552,000. The
decision to cease production in early 1999 in anticipation of the
proposed dissolution of the Company resulted in the reduction of net
realizable value of the inventory at December 31, 1998. In the fourth
quarter of 1999, $303,000 of this reserve was reversed since the Company
resumed production and certain inventory items reserved for at December
31, 1998 were sold in the current year.

Selling, general and administrative expense in 1999 of $850,000 was lower
than selling, general and administrative expense in 1998 of  $900,000 due
primarily to a decrease in personnel and a decrease in international
travel.

Research and development expense for the year ended December 31, 1999 was
$223,000, a decrease of $32,000 compared to $255,000 for the same period
of 1998. The decrease was a result of a decrease in engineering
personnel.

Other income (expense) for the year ended December 31, 1999 was $38,000
consisting of interest income from investments. Other income (expense)
for the year ended December 31, 1998 of $916,000 included $1,001,000 of
officer's life insurance proceeds received in excess of the policy's cash
surrender value from an insurance policy payable upon the death of Ronald
R. Jones, $33,000 of interest income from investments, $20,000 of
interest expense and $98,000 paid to Royce T. Jones as a settlement of
any and all claims that Royce T. Jones or the Estate of Ronald R. Jones,
may have had against the Company.

This document includes "forward-looking" statements within the meaning of
the Private Securities Litigation Reform Act of 1996. Management's
anticipation of future events is based upon assumptions regarding levels
of competition, research and development results, raw material markets,
the markets in which the Company operates, and stability of the
regulatory environment. Any of these assumptions could prove inaccurate,
and therefore there can be no assurance that the forward-looking
information will prove to be accurate.

                                       13
<PAGE>
INDEPENDENT AUDITORS' REPORT

Board of Directors and Stockholders
Circuit Research Labs, Inc.
Tempe, Arizona

We have audited the accompanying consolidated balance sheets of Circuit
Research Labs, Inc and subsidiaries (the "Company") as of December 31,
2000 and 1999, and the related consolidated statements of operations,
stockholders' equity, and cash flows for the years then ended.  These
financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements
based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States of America.  Those standards require that
we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement.  An
audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the 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, such consolidated financial statements present fairly, in
all material respects, the financial position of the Company as of
December 31, 2000 and 1999, and the results of their operations and their
cash flows for the years then ended in conformity with accounting
principles generally accepted in the United States of America.

As discussed in Note 10, the accompanying 2000 financial statements have
been restated.

DELOITTE & TOUCHE LLP
Phoenix, Arizona

April 16, 2001
(May 17, 2001 as to Notes 4 and 10)

                                       14
<PAGE>
CIRCUIT RESEARCH LABS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 2000 AND 1999

ASSETS (Note 4)                                      2000         1999
                                               (As Restated,
                                                see Note 10)
CURRENT ASSETS:
    Cash                                           $272,203      $62,597
    Securities available-for-sale                         0      383,905
    Accounts receivable, less allowance
      for doubtful accounts of
      $15,000 in 2000 and $9,700 in 1999            727,001       47,662
    Inventories (Note 2)                          3,258,683      561,205
    Prepaid expenses and other                      156,008       40,219
    Advances to shareholders                         21,654            0
                                                  ---------    ---------
          Total current assets                    4,435,549    1,095,588

PROPERTY, PLANT AND EQUIPMENT - Net (Note 3)      1,809,355      440,888
DEFERRED ACQUISITION COSTS                                0      298,215
OTHER ASSETS                                         39,000
GOODWILL (Net of Amortization of $615,908)        6,774,984            0
                                                  ---------    ---------

TOTAL                                           $13,058,888   $1,834,691
                                                 ==========    =========

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
    Accounts payable                               $836,965      $70,732
    Accrued salaries and benefits                   283,226       34,684
    Accrued professional fees                       100,198       30,933
    Customer deposits                               275,502        3,623
    Other accrued expenses and liabilities          282,912       10,507
    Due to shareholders                              25,000            0
    Current portion of long-term debt (Note 4)      483,280            0
                                                    -------      -------
          Total current liabilities               2,287,083      150,479
                                                  ---------      -------

LONG-TERM DEBT, LESS CURRENT PORTION (Note 4)     8,738,466            0
                                                  ---------      -------
         Total liabilities                       11,025,549      150,479
                                                 ----------      -------


                                       15
<PAGE>
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 2000 AND 1999 - continued               2000         1999
                                               (As Restated,
                                                see Note 10)
STOCKHOLDERS' EQUITY (Notes 4, 5 and 6):
 Preferred stock, $100 par value -
   authorized, 500,000 shares,
     None issued
 Common stock, $.10 par value -
   authorized, 20,000,000 shares; issued
     2,269,522 in 2000 and 1,195,364 in 1999        226,952       59,768
 Additional paid-in capital                       4,077,538    1,637,474
 Accumulated deficit                             (2,271,151)     (13,030)
                                                  ---------    ---------
         Total stockholders' equity               2,033,339    1,684,212
                                                  ---------    ---------
TOTAL                                           $13,058,888   $1,834,691
                                                 ==========    =========

See notes to consolidated financial statements.

                                       16
<PAGE>
CIRCUIT RESEARCH LABS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 2000 AND 1999

                                                     2000         1999
                                               (As Restated,
                                                see Note 10)

NET SALES (Note 8)                               $7,259,910   $1,016,807
COST OF GOODS SOLD                                4,342,650      241,296
                                                  ---------      -------
Gross profit                                      2,917,260      775,511
                                                  ---------      -------

OPERATING EXPENSES
    Selling, general and administrative           2,480,337      816,516
    Research and development                      1,052,496      223,441
    Depreciation                                    267,581       33,861
    Amortization                                    615,908
                                                    -------      -------
Total operating expenses                          4,416,322    1,073,818
                                                  ---------    ---------
LOSS FROM OPERATIONS                             (1,499,062)    (298,307)
                                                  ---------      -------
OTHER (INCOME) EXPENSE:
    Interest and other income                       (18,170)     (38,078)
    Interest and other expense                      777,229            0
                                                    -------      -------

Total other (income) expense                        759,059      (38,078)
                                                    -------      -------

LOSS BEFORE INCOME TAX                           (2,258,121)    (260,229)

INCOME TAX (Note 7):                                      0            0
                                                  ---------      -------
NET LOSS                                        ($2,258,121)   ($260,229)
NET LOSS PER COMMON SHARE - BASIC AND DILUTED        ($1.28)      ($0.28)

See notes to consolidated financial statements.

                                       17
<PAGE>
CIRCUIT RESEARCH LABS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
YEARS ENDED DECEMBER 31, 2000 AND 1999

                                                  Retained
                      Common Stock   Additional   Earnings
                                       Paid-in  (Accumulated Treasury
                    Shares   Amount    Capital     Deficit)   Stock     Total
BALANCE,
  January 1,
  1999            1,195,364 $119,536 $1,187,472  $247,199 ($181,640) $1,372,567
Sale of treasury stock                  390,234             181,640     571,874

Net loss                                         (260,229)             (260,229)
                     ------   ------    -------   -------    ------     -------
BALANCE,
  December 31,
  1999            1,195,364  119,536  1,577,706   (13,030)        0   1,684,212

Issuance of
common shares     1,074,158  107,416  1,449,832                       1,557,248

Issuance of
Warrants                              1,050,000                       1,050,000

Net loss (as restated,
see Note 10)                         (2,258,121)                     (2,258,121)
                  ---------  -------  ---------    -------   ------  ---------

BALANCE,
  December 31,
  2000 (as restated,
  see Note 10)    2,269,522 $226,952 $4,077,538 ($2,271,151)     $0  $2,033,339
                  =========  =======  =========   =========  ======   =========

See notes to consolidated financial statements.

                                       18
<PAGE>
CIRCUIT RESEARCH LABS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 2000 AND 1999

                                                     2000         1999
                                               (As restated,
                                                See Note 10)
OPERATING ACTIVITIES:
Net loss                                        ($2,258,121)   ($260,229)
Adjustments to reconcile (net loss) to
  net cash provided by (used in) operating activities:
     Depreciation and amortization                  883,489       33,861
     Loss on disposal of assets                                    5,930
     Decrease in inventory reserves                 (56,258)    (317,122)
     Changes in assets and liabilities:
       Accounts receivable                          385,173       40,280
       Inventories                                  136,513      140,284
       Prepaid expenses and other                   256,974       29,343
       Deferred acquisition costs                                298,215
       Accounts payable and other accrued expenses  997,594       11,472
                                                    -------      -------
        Net cash provided by (used in)
          operating activities                      345,904     (673,082)

INVESTING ACTIVITIES:
     Capital expenditures                           (32,316)     (51,942)
     Purchase of securities                                     (870,198)
     Proceeds from sale or maturity of securities   383,905      973,254
     Purchase of net assets of Orban, Inc.       (2,586,881)           0
                                                  ---------      -------
        Net cash (used in) provided by
          investing activities                   (2,235,292)      51,114

FINANCING ACTIVITIES:
     Proceeds from debt                             430,341
     Principal payments on long-term debt           (11,095)     (16,000)
     Proceeds from shareholder advances and debt    122,500
     Proceeds from sale of common stock           1,557,248
     Sale of treasury stock                               0      571,874
                                                  ---------      -------
        Net cash provided by
          financing activities                    2,098,994      555,874
                                                  ---------      -------

        NET INCREASE (DECREASE) IN CASH             209,606      (66,094)


CASH, BEGINNING OF YEAR                              62,597      128,691
                                                    -------      -------
CASH, END OF YEAR                                  $272,203      $62,597
                                                    =======       ======
SUPLEMENTAL CASH FLOW INFORMATION
        Cash paid for interest                     $774,829           $0
                                                    =======       ======
        Sale of assets in exchange for
          balance on notes payable                       $0       $5,000
                                                         ==        =====

                                       19
<PAGE>
              CIRCUIT RESEARCH LABS, INC. and SUBSIDIARIES
                  CONSOLIDATED STATEMENTS OF CASH FLOWS


                                                     2000         1999
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING
AND FINANCING ACTIVITIES:
  Purchase of net assets of Orban, Inc.:
    Fair value of net assets acquired,
     including goodwill                         $12,640,096
    Debt issued to seller                        (8,500,000)
    Fair values of warrants issued to seller     (1,050,000)
    Debt issued to stockholder                     (205,000)
    Costs paid in 1999                             (298,215)
                                                    -------
    Cash paid                                    $2,586,881
                                                  =========

See notes to consolidated financial statements.

                                       20
<PAGE>
CIRCUIT RESEARCH LABS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 2000 (Restated) AND 1999


1. DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING
   POLICIES

Circuit Research Labs, Inc. (the "Company" or "CRL") is an electronics
company developing, manufacturing and marketing high quality audio
processing and transmission encoding equipment for the radio, television
and professional audio markets worldwide.

Principles of Consolidation - The consolidated financial statements
include the accounts of Circuit Research Labs, Inc. and its wholly owned
subsidiaries:  CRL Systems, Inc. ("CRL Systems") and CRL International,
Inc. (collectively, the "Company").   Significant intercompany accounts
and transactions have been eliminated in consolidation.

On May 31, 2000, CRL Systems acquired the net assets of Orban, Inc.
("Orban"), a wholly owned subsidiary of Harman International Industries,
Inc.  Including the $500,000 non-refundable deposit previously paid to
Orban, the total stated purchase price was $10.5 million, $2 million of
which was paid in cash, the balance was financed through a combination of
short-term and long-term seller financing.  In addition to the stated
purchase price, CRL issued to Orban, Inc. warrants to purchase 1,000,000
shares of its common stock, immediately exercisable for $2.25 per share.
The warrants were valued at $1,050,000 at the time of the purchase to be
part of the total purchase price of $11,550,000.  The Asset Sale
Agreement between CRL Systems and Orban contains a provision to allow
Orban to rescind the transaction if, as of November 30, 2000, CRL Systems
has not paid in full the $3.5 million short-term note.  If Orban
exercises its option to rescind the agreement, it is to return $9,250,000
of the purchase price to CRL Systems, with the difference due to Orban as
liquidating damages.  The note has since been extended to April 30, 2002
with Orban retaining the option to rescind the agreement.  As part of the
acquisition, CRL Systems purchased the rights to the name "Orban" and
operates a portion of its business under the "Orban" trade name.

The acquisition has been accounted for as a purchase and accordingly the
net assets and results of operations of Orban have been included in the
consolidated financial statements commencing May 31, 2000.  The excess of
the total acquisition costs over the fair value of the assets acquired of
approximately $7.1 million is being amortized over 7 years. After the
acquisition, the majority of the Company's revenues are derived from the
sale of Orban products, totalled  $6,500,000 during the seven months
ended December 31, 2000.

The following unaudited pro-forma summary combines the consolidated
results of operations of the Company and Orban as if the acquisition had
occurred on January 1 of that period after giving effect to certain
adjustments including amortization of the purchase price in excess of net
assets acquired, corporate general and administrative expenses, and
income taxes.  This pro-forma summary is not necessarily indicative of
the results of operations that would have occurred if the Company and
Orban had been combined during such periods.  Moreover, the pro-forma
summary is not intended to be indicative of the results of operations to
be attained in the future.

                                       21
<PAGE>
                                                   Twelve Months Ended
                                                       December 31
                                                    2000         1999

Net revenues                                    $12,255,000  $13,385,000
Net loss                                         (1,647,000)  (1,799,000)
Net loss per common share                           (.93)       (1.05)


Significant accounting policies are as follows:

a. Securities available-for-sale are securities being held for
   indefinite periods of time, including securities that management intends
   to use for liquidity needs or that may be sold in response to changes in
   interest rates, prepayments or other factors and are carried at estimated
   fair value, with the net, after-tax unrealized gain or loss recorded as a
   separate component of stockholders' equity with no effect on current
   results of operations. Realized gains and losses are included in other
   income and are computed using specific identification.  The fair value of
   the Company's securities is estimated based on quoted market prices for
   those or similar instruments.

b. Inventories are stated at the lower of cost (first-in, first-out
   method) or market.

c. Property, plant and equipment are stated at cost.  Depreciation is
   computed using the straight-line method over the estimated useful lives
   of the related assets ranging from 2 to 5 years for furniture, fixtures,
   machinery and equipment, and 31.5 years for building and improvements.

d. Deferred acquisition costs as of December 31, 1999, are the total
   costs deferred relating to the Orban acquisition totalling $298,215,
   including a $250,000 non-refundable deposit. There are no costs
   deferred as of December 31, 2000.

e. Long-lived assets - In accordance with Statement of Financial
   Accounting Standards ("SFAS") No. 121, "Accounting for the Impairment
   of Long-Lived Assets and for Long-Lived Assets to be Disposed Of," the
   Company reviews the carrying value of its long-lived assets and
   identifiable intangibles for possible impairment whenever events or
   changes in circumstances indicate that the carrying amounts may not be
   recoverable. For assets to be disposed of, the Company reports long-
   lived assets and certain identifiable intangibles at the lower of
   carrying amount or fair value less cost to sell.

f. Revenue is recognized on sales of products when the risks and rewards
   of ownership transfer to customers, which is generally at the time of
   shipment. No significant obligations remain after the product is
   shipped. Sales returns are generally not accepted unless under a
   warranty claim.

g. Research and development costs are charged to expense as incurred.

h. Income taxes - Income tax expense is calculated under the liability
   method as required under SFAS No. 109, "Accounting for Income Taxes".
   Under the liability method, deferred tax assets and liabilities are
   determined based upon the differences between financial statement
   carrying amounts and the tax bases of existing assets and liabilities
   and are measured at the tax rates that will be in effect when these
   differences reverse.

                                       22
<PAGE>
i. Financial instruments - SFAS No. 107 "Disclosures About Fair Value
   of Financial Instruments" requires disclosures of the estimated fair
   value of certain financial instruments. The Company has estimated the
   fair value of its financial instruments using available market data.
   However, considerable judgment is required in interpreting market data
   to develop estimates of fair value. The use of different market
   assumptions or methodologies may have a material effect on the
   estimates of fair value.  The carrying values of cash, securities
   available-for-sale, receivables, accounts payable and long-term debt
   approximate fair values due to the short-term maturities or market
   rates of interest of these instruments.

j. Income (loss) per share - SFAS No. 128. "Earnings Per Share",
   requires the dual presentation of basic and diluted earnings per share
   on the face of the income statement and the disclosure of the
   reconciliation between numerators and denominators of basic and
   diluted earnings per share calculations. Loss per share amounts for
   the years ended December 31, 2000 and 1999 are calculated using only
   weighted average outstanding shares of 1,770,265 and 916,940
   respectively.  Options and warrants to purchase 1,026,500 and
   1,708,158 shares respectively, of common stock for the year ended
   December 31, 2000 were not used in computing diluted earnings per
   share because the result would be anti-dilutive.  Options to purchase
   1,342,500 shares of common stock for the year ended December 31, 1999
   were not used in computing diluted earnings per share because the
   result would be anti-dilutive.

k. New accounting pronouncements - In June 1998, the Financial Accounting
   Standards Board issued SFAS No. 133, "Accounting for Derivative
   Instruments and Hedging Activities".  SFAS No. 133 and its related
   amendments and interpretations, which will be effective for the
   Company's financial statements as of January 1, 2001, requires that
   entities record all derivatives as assets or liabilities, measured at
   fair value, with the change in fair value recognized in earnings or in
   comprehensive income, depending on the use of the derivative and
   whether it qualifies for hedge accounting.  The adoption of this
   standard will not have a significant impact on the Company's
   consolidated results of operations, financial position or cash flows.

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

m. Reclassifications - Certain reclassifications have been made to the
   1999 financial statements to conform to the classifications used in
   2000.

                                       23
<PAGE>
2. INVENTORIES

Inventories consist of the following at December 31:
                                                     2000         1999


Raw materials and supplies                       $2,062,311     $344,116
Work in process                                   1,262,536      214,933
Finished goods                                      774,836      382,156
                                                    -------      -------
Total                                             4,099,683      941,205
Less obsolescence reserve                           841,000      380,000
                                                    -------      -------
Inventories, net                                 $3,258,683     $561,205
                                                  =========      =======

3. PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment consist of the following at December 31:
                                                     2000         1999

Land                                               $130,869     $130,869
Building and improvements                           874,697      503,000
Furniture and fixtures                              927,227      285,167
Machinery and equipment                           1,135,395      518,272
                                                  ---------      -------
                                                  3,068,188    1,437,308
Less accumulated depreciation                     1,258,833      996,420
                                                  ---------      -------
Property, plant and equipment - net              $1,809,355     $440,888
                                                  =========      =======

4. LONG-TERM DEBT

Long term-debt at December 31, 2000 consisted of the following:

Orban, Inc. Tranche A Note                       $5,000,000
Orban, Inc. Tranche B Note                        3,500,000
Note to shareholder                                 193,859
Note to shareholder                                  97,500
Mortgage note                                       362,000
Employee note                                        68,387
                                                     ------
Total long-term debt                             $9,221,746
Less current portion                                483,280
                                                    -------
Total long-term debt, less current portion       $8,738,466
                                                  =========


                                       24
<PAGE>
In conjunction with the Asset Sale Agreement between Orban, Inc. and CRL
Systems, Inc., CRL Systems and Orban entered into a Credit Agreement to
establish the terms and conditions of the $8,500,0000 loan from Orban to
CRL Systems.  The loan is evidenced by two promissory notes, the Senior
Subordinated Tranche A Note (the "Tranche A Note") and the Senior
Subordinated Tranche B Note (the "Tranche B Note").  The Tranche A Note,
in the amount of  $5,000,000, originally bore interest at 8 percent per
annum and required quarterly principal payments beginning March 31, 2001,
with a balloon payment of $3,000,000 due on March 31, 2003.  The Tranche
B Note, in the amount of $3,500,000, bore interest at 8 percent per annum
for the period from June 1, 2000 to July 31, 2000 and 10 percent per
annum from August 1, 2000 up to its September 30, 2000 maturity date. The
notes are collateralized by, among other things, all receivables,
inventory and equipment, investment property, including CRL's capital
stock in CRL Systems, and intellectual property of CRL and CRL Systems,
as defined in the "Guarantee and Collateral Agreement". In addition all
proceeds of debt or equity or sales of assets are to be first applied to
the remaining balance due in the notes.

The Company has received several payment extensions on the Tranche A and
B notes. First, in exchange for $150,000 cash and an increase in the
interest rates to 12 percent per annum for both the Tranche A and Tranche
B notes, Orban, Inc. extended the maturity date of the Tranche B note to
November 30, 2000. The maturity date of the Tranche B note has
subsequently been extended several times without fees or other
significant changes to the original terms of the note and is now due in
full on April 30, 2002. Also, the first principal payment on the Tranche
A note of $250,000, originally due March 31, 2001, has been extended to
September 30, 2001 with the remaining quarterly principal payments
deferred until April 30, 2002.  Interest only payments are payable
monthly for both notes.

In consideration for arranging the purchase financing of Orban, the
Company incurred fees of $97,500 to a shareholder, the total of which is
included in the current portion of long-term debt at December 31, 2000.
The note is due May 14, 2001 and accrues interest of 7.5 percent per
annum starting at the original date of the note of June 21, 2000, which
is payable at maturity. The note has subsequently been extended to August 14,
2001.

The Company issued $205,000 in long-term debt to a shareholder in
consideration for his role in the acquisition of the assets of Orban,
Inc.  The note bears interest at 7.5 per cent per annum, with principal
and interest due monthly beginning August 1, 2000 for four years.

During the second quarter of 2000, the Company's president, Charles
Jayson Brentlinger, loaned the Company $195,000 in a short-term non-
interest bearing advance. On November 30, 2000, Mr. Brentlinger converted
his loan to the Company to purchase 156,000 shares of the Company's
common stock for $1.25 per share under the 1999 stock purchase agreement
between him and the Company.

On May 30, 2000, the Company mortgaged its office building and
manufacturing facility in Tempe, Arizona for $335,000.  The mortgage note
bears interest at 15.25 percent per annum, payable monthly, and the full
principal balance was to be paid on November 30, 2000. Prior to the
December 2000 extended maturity date, the Company refinanced the unpaid
balance into two new mortgage agreements for $300,000 and $62,000. The
notes bear interest at 11.75 percent per annum and 14.75 percent per
annum respectively. Principal and interest payments are payable monthly
for both notes commencing in February 2001 using a 12-year amortization
period and requiring a balloon payment at the end of the five-year term.

                                       25
<PAGE>
On  June 12, 2000, the Company entered into a promissory note for $68,387
from an employee.  The note bears interest at 12 percent per annum.   All
principal and interest was due September 12, 2000; however, the  maturity
date has been extended to June 30, 2001. The note is unsecured.

The  following  represents the principal maturities for  the  five  years
subsequent to December 31, 2000:

  2001             $483,280
  2002            5,316,566
  2003            3,072,546
  2004               54,958
  2005               22,764
Thereafter          271,632
                    -------
Total            $9,221,746
                  =========

The Company leases certain facilities under a noncancellable operating lease
which renews in 2001. The total minimum rental commitment at December 31, 2000
is $473,000 through the November 30, 2001 expiration date. A portion of these
facilities is sublet out on a month-to-month basis. Net rental expense for the
year ended December 31, 2000 was $194,000.

5. STOCKHOLDERS' EQUITY

On July 7, 2000, the Board of Directors declared a 100 percent stock
dividend of one share of common stock for each share held, payable on
August 15, 2000 to all shareholders of record as of the close of business
on July 31, 2000. All share and per share amounts included in the
accompanying financial statements have been retroactively adjusted to
give effect to the stock dividend.

During the second and third quarters of 2000, the Company sold in a
private placement, for $1.50 per share, 708,158 units of common stock and
warrants under a subscription agreement (the "Subscription Agreement")
with accredited investors.  Under the agreement, each unit consists of
one share of the Company's common stock and one warrant (the "Class A
Warrants") to purchase at an exercise price of $1.75 per share one share
of the Company's common stock and one Class B Warrant (as defined).  The
Class A Warrant may be exercised for a sixty-day period following the
registration of the shares issuable upon exercise of the Class A
Warrants.  The holder of a Class A Warrant shall not have the right to
obtain a Class B Warrant if the Class A Warrant is not timely exercised.
Each Class B Warrant, if and when issued, will be a warrant to purchase
at an exercise price of $2.00 per share one share of Company's common
stock and one Class C Warrant. The holder of a Class B Warrant shall not
have the right to obtain a Class C Warrant if the Class B Warrant is not
timely exercised, as defined in the subscription agreement.  Each Class C
Warrant, if and when issued, will be a warrant to purchase at an exercise
price of $2.25 per share one share of Company's common stock and one
Class D Warrant.  The holder of a Class C Warrant shall not have the
right to obtain a Class D Warrant if the Class C Warrant is not timely
exercised, as defined in the subscription agreement. Each Class D
Warrant, if and when issued, will be a warrant to purchase at an exercise
price of $2.50 per share one share of Company's common stock. As of
December 31,2000, none of the warrants have been exercised.

                                       26
<PAGE>
6. STOCK OPTIONS

In May 1994, the Company's stockholders approved the Company's 1994 Stock
Option Plan, which set aside an aggregate of 120,000 shares of common
stock for which options may be granted to employees, officers, directors,
and consultants. Options are typically exercisable upon the grant date
for up to 3 years at a price equal to 100% of the fair market value at
the date of grant. There are no options outstanding under this plan at
December 31, 2000.

In September 1999, the Company entered into two stock agreements with its
president Charles Jayson Brentlinger. The first, pursuant to the terms of
a stock purchase agreement, required the President to purchase 342,500
shares of the Company's common stock at $1.25 per share within 1 year.
Prior to such date, he purchased 160,000 shares under the agreement. On
October 20, 2000, the purchase date was extended to December 31, 2000. As
of December 31, 2000 he remained obligated to purchase 26,500 shares on
or before December 31, 2000 for a total price of $33,125.  In
consideration of the cash advances received from the president to the
Company, the Board of Directors issued a resolution extending the terms
of the stock purchase agreement to February 8, 2001 at which time Mr.
Brentlinger fulfilled his remaining obligation.

The second was a grant of stock options, which vested immediately, for
options to purchase 1,000,000 shares over the next 5 years for $1.25 per
share.  No options have been exercised under this grant.   Mr Brentlinger
has committed to exercise his options, if necessary, in order to satisfy
the Company's debt payments, if operating cash flows are inadequate.

The Company applies Accounting Principles Board Opinion No. 25 and
related interpretations in accounting for these stock options.
Accordingly, no compensation cost has been recognized for the stock
options.  Had compensation cost for the Company's stock options been
determined based on the fair value at the grant dates for awards
consistent with the method of SFAS No. 123, the Company's net loss and
net loss per share for the year ended December 31, 1999 would have been
increased to the pro forma amounts indicated below:

   Net loss - as reported                   $ (260,229)
   Net loss - pro forma                       (730,863)
   Loss per share - as reported                   (.28)
   Loss per share - pro forma                     (.79)

The fair market value of each option grant is estimated on the date of
grant using the Black-Scholes options pricing model with the following
weighted-average assumptions used for grants: no dividend yield, expected
volatility of 85%, risk-free interest rate of 6.25%, and expected lives
of two years.

There would have been no compensation expense under SFAS No. 123 in the year
ended December 31, 2000.

                                       27
<PAGE>
7. INCOME TAXES

The principal reasons for the difference between the income tax benefit
provision and the amounts computed by applying the statutory income tax
rates to the loss for the years ended December 31, are as follows:

                                                     2000         1999

Federal tax at statutory rates                    ($767,800)    ($88,500)
State tax at statutory rates                       (135,500)     (15,600)
Officer's life insurance proceeds                         0      (13,200)
Officer's life insurance                                  0        1,600
Increase in valuation allowance                     903,300      115,700
                                                    -------      -------
Total                                                    $0           $0
                                                    =======      =======

At December 31, deferred taxes represent the tax effect of temporary
differences related to:
                                                     2000         1999
Current deferred taxes:
Inventory capitalization                           $138,400      $89,200
Prepaid expenses                                     (4,800)     (13,100)
Inventory obsolescence reserve                      336,200      151,900
Allowance for doubtful accounts                       6,100        3,800
Warranty and other accruals                          99,300            0
Deferred tax valuation allowance                   (575,200)    (231,800)
                                                    -------      -------
Total                                                    $0           $0
                                                    =======      =======

                                                     2000         1999
Non-current deferred taxes:
Goodwill amortization                              $131,400           $0
Depreciation and amortization                       (61,200)     (25,900)
Operating loss carry forward                        956,000      446,300
Other                                                     0       46,000
Federal general business credit carry forward        65,400       65,400
Deferred tax valuation allowance                 (1,091,700)    (531,800)
                                                  ---------      -------
Total                                                    $0           $0
                                                  =========      =======

At December 31, 2000, a valuation allowance totalling $1,666,900 was
recorded which relates to, among other items, federal and state net
operating losses and federal general business credit carry forwards for
which the utilization is not reasonably assured. Net operating loss
carryforwards of approximately $2,391,000, which expire through 2020, are
available for federal income tax purposes.

                                       28
<PAGE>
8.  SEGMENT REPORTING, SALES TO MAJOR CUSTOMERS AND EXPORT SALES

The Company manufactures and distributes audio processing and Radio and
TV studio equipment.  The Company's primary end user market is Radio and
TV stations and also the Internet market. The chief operating decision
makers are provided information about revenues generated by product line,
with all products having similar production processes, customers and
distribution channels. The Company's long-lived assets are all located in
the United States.

Sales during the years ended December 31, 2000 and 1999 were conducted
primarily through wholesale distributors and dealers. In 2000,
approximately 33% of the net sales where generated from one wholesale
distributor while in 1999 there were no wholesale distributors that
accounted for 10% or more of net sales.

International sales in 2000 and 1999 totalled approximately $3,148,000
and $501,000, respectively.  International sales are made through the
Company's wholly-owned foreign sales corporation CRL International, Inc.
The Company requires that all export sales be paid in U.S. currency.
Accordingly, there are no foreign currency gains or losses for the years
ended December 31, 2000 or 1999.

The Company's export sales by region as determined by customer location are as
follows:

Region                           2000     %          1999     %

Europe                       $1,679,659   53%       $42,000    8%
Pacific Rim                     731,994   23        253,000   50
Latin and South America         527,618   17         23,000    5
Canada and Mexico               179,339    6         94,000   19
Other                            27,408    1         89,000   18
                                 ------  ---         ------  ---
Total                        $3,148,017  100%      $501,000  100%
                              =========  ===        =======  ===

9. EMPLOYEE BENEFIT PLAN

As of January 1, 1991, the Company adopted a 401(k) profit sharing plan
(the "Plan") for the benefit of all employees who meet certain
eligibility requirements.  The Company will match 50% of employee
contributions up to a maximum contribution by the Company of 3% of a
participant's annual compensation. Total annual contributions to a
participant's account may not exceed 25% of compensation.  Company
contributions made to the Plan were $35,063 and $16,480 in 2000 and 1999,
respectively.

                                       29
<PAGE>
10.  RESTATEMENT

Subsequent to the issuance of the Company's 2000 financial statements,
the Company's management determined that sales totalling $275,060 that
were recorded in 2000 should have been reversed due to their subsequent
return by the customer.  As a result, the 2000 financial statements have
been restated from the amounts previously reported to reflect the
reversal of this sale as follows:

                                      As Previously
                                        Reported       As Restated
At December 31, 2000:
   Accounts receivable                 $1,002,061        $727,001
   Accumulated deficit                 (1,996,091)     (2,271,151)
   Total stockholders' equity           2,308,399       2,033,339

For the year ended
December 31, 2000:
   Sales                                7,534,970       7,259,910
   Net loss                            (1,983,061)     (2,258,121)
   Loss per share - basic and diluted     (1.12)          (1.28)

Because the inventory that was involved in the sale had been determined
to be unsaleable inventory in a prior year and had no carrying value, the
sales return did not affect either inventory or cost of sales.

                                       30
<PAGE>
Circuit Research Labs, Inc.

STOCK MARKET INFORMATION

The Company's common stock is publicly traded on the OTC Bulletin Board
(NASDAQ symbol: CRLI) and commenced trading on November 4, 1983.  As of
March 30, 2001, there were 2,296,022 shares of common stock issued and
outstanding, with an estimated 450 stockholders of record.  The following
table sets forth the high and low closing bid prices as reported by the
National Association of Securities Dealers Automated Quotations (NASDAQ).
The high and low closing bid prices have been adjusted to reflect a 100%
stock dividend that was effective on August 15, 2000.


                                        2000 - Quarters Ended

                         March 31       June 30  September 30   December 31
Bid Quotation Range

High                        $7.50         $7.00        $10.75         $9.88
Low                         $1.00         $2.50         $4.25         $4.50


                                        1999 - Quarters Ended

                         March 31       June 30  September 30   December 31
Bid Quotation Range

High                        $1.16         $1.25         $1.25         $1.44
Low                          $.72          $.75          $.75          $.56


Over-the-counter market quotations reflect inter-dealer prices, without
retail mark-up, mark-down or commission and may not necessarily represent
actual transactions.


DIVIDENDS

The Company has not paid any dividends on its common stock for the two
most recent fiscal years.

                                       31
<PAGE>
Circuit Research Labs, Inc.

                           CORPORATE DIRECTORY

Charles Jayson Brentlinger              Chief Executive
                                        Officer, President and Chairman

Gary D. Clarkson                        Secretary, Treasurer, Vice President
                                        and General Manager

Robert A. Orban                         Director and Chief Engineer

Carl E. Matthusen                       Director

Phillip T. Zeni                         Director

James Seemiller                         Chief Financial Officer and Vice
                                        President of Sales, Marketing and
                                        New Business Development

Greg J. Ogonowski                       Vice President of
                                        New Product Development

William R. Devitt                       Vice President of Manufacturing
                                        and Production

                          CORPORATE INFORMATION
                         Corporate Headquarters:
                       Circuit Research Labs, Inc.
                         2522 West Geneva Drive
                          Tempe, Arizona  85282

Transfer Agent and Registrar:                Independent Auditors:
  Computershare Investor Services              Deloitte & Touche LLP
  2 North LaSalle Street                       2901 North Central Avenue
  Chicago, Illinois 60602                      Suite 1200
                                               Phoenix, Arizona 85012

Corporate Counsel:
  John L. Hay, Esquire
  Gust Rosenfeld P.L.C.
  201 N. Central Ave., Suite 330
  Phoenix, AZ  85073-3300

Additional Information:

A copy of Circuit Research Labs, Inc.'s current Form 10-KSB/A has been
filed with the Securities and Exchange Commission and is available on
request without charge by writing to the Company's corporate headquarters
and marked:  Attention:  Investor Relations.

                                       32
<PAGE>

                                   Exhibit 23
                        Consent of Deloitte & Touche LLP


INDEPENDENT AUDITORS' CONSENT


We consent to the incorporation by reference in Registration
Statement Nos. 33-82176 and 333-50920 of Circuit Research Labs,
Inc. on Forms S-8 of our report dated April 16, 2001, May 17, 2001
as to Notes 4 and 10, (which expresses an unqualified opinion and includes
an explanatory paragraph relating to the restatement described in
Note 10)  incorporated by reference in this Amendment No. 1 to
Annual Report on Form 10-KSB of Circuit Research Labs, Inc. for the
year ended December 31, 2000.




DELOITTE & TOUCHE LLP

Phoenix, Arizona
May 17, 2001