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 NOVEMBER 30, 2003

                 |_| TRANSITION REPORT UNDER SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

              FOR THE TRANSITION PERIOD FROM _________ TO _________

                         COMMISSION FILE NUMBER: 0-30703

                        COLLECTIBLE CONCEPTS GROUP, INC.
             (Exact name of registrant as specified on its charter)

                DELAWARE                                 95-4026880
     (State or other jurisdiction of                   (IRS Employer
     incorporation or organization)                 Identification No.)

                              1600 LOWER STATE ROAD
                              DOYLESTOWN, PA 18901
                    (Address of principle executive offices)

                                 (215) 491-1075
              (Registrant's telephone number, including area code)

              (Former name, former address and former fiscal year,
                         if changed since last report)

Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 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 [ ] No [X]

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

Indicate by check mark whether the registrant filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act
of 1934 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 registrant's classes of
common equity, as of the latest practicable date: 535,166,225 shares issued and
outstanding as of August 31, 2004

<PAGE>

                        COLLECTIBLE CONCEPTS GROUP, INC.

                                      INDEX

PART I FINANCIAL INFORMATION

  ITEM 1  Condensed Consolidated Balance Sheet As Of November 30, 2003
          (Unaudited)                                                          3

          Condensed Consolidated  Statements Of Operations For The Three
          Months Ended November 30, 2003 And 2002 (Unaudited)                  4

          Condensed  Consolidated  Statements Of Operations For The Nine
          Months Ended November 30, 2003 And 2002 (Unaudited)                  5

          Condensed  Consolidated  Statement Of Changes In  Shareholders'
          Deficiency For The Nine Months Ended November 30, 2003 (Unaudited)   6

          Condensed  Consolidated  Statements Of Cash Flows For The Nine
          Months Ended November 30, 2003 And 2002 (Unaudited)                  7

          Notes To Condensed Consolidated Financial Statements As Of
          November 30, 2003 (Unaudited)                                   8 - 18

  ITEM 2  Management's Discussion and Analysis of Financial Condition and
          Results of Operations                                          19 - 25

  ITEM 3  Controls and Procedures                                             26

PART II  OTHER INFORMATION

  ITEM 1  Legal proceedings                                                   27
  ITEM 2  Changes in securities and use of proceeds                           27
  ITEM 3  Defaults upon senior securities                                     27
  ITEM 4  Submission of matters to a vote of security holders                 27
  ITEM 5  Other information                                                   27
  ITEM 6  Exhibits and Reports on 8-K                                         28

  SIGNATURES                                                                  29


                                       2
<PAGE>

                   COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEET
                             AS OF NOVEMBER 30, 2003
                                      (UNAUDITED)

                                     ASSETS
CURRENT ASSETS
Cash                                                               $      1,316
Accounts receivable, net of allowance for doubtful
accounts of $2,740                                                       36,924
Inventories                                                              13,738
                                                                   ------------
Total Current Assets                                                     51,978
                                                                   ------------

PROPERTY AND EQUIPMENT, NET                                              24,831
                                                                   ------------

OTHER ASSETS
Trademarks                                                                1,300
Security deposits                                                         3,200
                                                                   ------------
Total Other Assets                                                        4,500
                                                                   ------------

TOTAL ASSETS                                                       $     81,309
                                                                   ============

                    LIABILITIES AND SHAREHOLDERS' DEFICIENCY

CURRENT LIABILITIES
Accounts payable                                                   $  1,494,375
Accrued expenses                                                      1,868,455
Convertible secured debentures, net                                     791,715
Notes and loans payable, current portion                                778,831
Loans payable - related parties                                          86,050
Convertible subordinated debentures                                     114,800
                                                                   ------------
Total Current Liabilities                                             5,134,226

Notes and loans payable, long-term portion                                4,321
                                                                   ------------

TOTAL LIABILITIES                                                     5,138,547
                                                                   ------------

COMMITMENTS AND CONTINGENCIES                                                --

SHAREHOLDERS' DEFICIENCY
Common stock, $.001 par value, 700,000,000 shares authorized,
357,674,858 shares issued and outstanding                               357,672
Common stock to be issued (5,758,051 shares)                             21,544
Additional paid-in capital                                           14,588,343
Deferred equity based expense                                           (87,500)
Accumulated deficit                                                 (19,937,297)
                                                                   ------------
Total Shareholders' Deficiency                                       (5,057,238)
                                                                   ------------
TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIENCY                     $     81,309
                                                                   ============


      See accompanying notes to condensed consolidated financial statements


                                       3
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
               CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS FOR
                 THE THREE MONTHS ENDED NOVEMBER 30, 2003 & 2002
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                               2003             2002
                                                          -------------    -------------
<S>                                                       <C>              <C>
SALES                                                     $      40,957    $       4,894

COST OF SALES                                                    52,114            6,805
                                                          -------------    -------------

GROSS (LOSS)                                                    (11,157)          (1,911)

OPERATING EXPENSES
Selling, general and administrative                             306,736          224,606
                                                          -------------    -------------

LOSS FROM OPERATIONS                                           (317,893)        (226,517)
                                                          -------------    -------------

OTHER INCOME (EXPENSE)
Consulting Income                                                16,000               --
Interest expense                                               (118,587)         (24,917)
Loss on settlement of debt and interest                              --          (16,071)
                                                          -------------    -------------
Total Other Income (Expense)                                   (102,587)         (40,988)
                                                          -------------    -------------

LOSS BEFORE TAX PROVISION                                      (420,480)        (267,505)
INCOME TAX PROVISION                                                 --               --
                                                          -------------    -------------

NET LOSS                                                  $    (420,480)   $    (267,505)
                                                          =============    =============

BASIC AND DILUTED LOSS PER SHARE                          $          --    $       (0.01)
                                                          =============    =============

WEIGHTED AVERAGE SHARES USED IN NET LOSS CALCULATIONS -
BASIC AND DILUTED                                           322,153,584       45,302,183
                                                          =============    =============
</TABLE>


      See accompanying notes to condensed consolidated financial statements


                                       4
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
               CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS FOR
                 THE NINE MONTHS ENDED NOVEMBER 30, 2003 & 2002
                                   (UNAUDITED)

                                                      2003             2002
                                                 -------------    -------------

SALES                                            $     127,773    $      53,883

COST OF SALES                                          114,039           77,814
                                                 -------------    -------------

GROSS PROFIT (LOSS)                                     13,734          (23,931)

OPERATING EXPENSES
Selling, general and administrative                    789,127        1,061,163
                                                 -------------    -------------

LOSS FROM OPERATIONS                                  (775,393)      (1,085,094)
                                                 -------------    -------------

OTHER INCOME (EXPENSE)
Consulting Income                                       25,000               --
Interest expense                                      (331,926)        (142,068)
Loss on debt conversion                                     --          (16,071)
Forgiveness of Debt                                         --           70,778
                                                 -------------    -------------
Total Other Income (Expense)                          (306,926)         (87,361)
                                                 -------------    -------------

LOSS BEFORE TAX PROVISION                           (1,082,319)      (1,172,455)
INCOME TAX PROVISION                                        --               --
                                                 -------------    -------------

NET LOSS                                         $  (1,082,319)   $  (1,172,455)
                                                 =============    =============


BASIC AND DILUTED LOSS PER SHARE                 $       (0.01)    $      (0.04)
                                                 =============    =============

WEIGHTED AVERAGE SHARES USED IN NET LOSS
CALCULATIONS - BASIC AND DILUTED                   197,775,509       28,569,422
                                                 =============    =============

      See accompanying notes to condensed consolidated financial statements


                                       5
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
     CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' DEFICIENCY
                   FOR THE NINE MONTHS ENDED NOVEMBER 30, 2003
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                     Common Stock       Additional    Deferred
                                                             Common Stock            To be issued         Paid-In    Equity-Based
                                                           Shares      Amount     Shares       Amount     Capital      Expense
                                                         ------------------------------------------------------------------------
<S>                                                       <C>         <C>       <C>           <C>      <C>            <C>
Balance, February 28, 2003                                99,400,121  $ 99,400  $ 1,524,506   $10,374  $ 14,396,576   $(187,500)

Common stock issued for cash                               9,714,286     9,714           --        --         7,286          --

Common stock issued for services rendered                 99,775,000    99,775           --        --       148,449          --

Common stock to be issued per anti-dilution provision             --        --    4,233,545    11,170       (11,170)         --

Conversions of convertible secured debentures to
  common stock                                            38,868,751    38,867           --        --       (12,882)         --

Conversions of notes and loans payable to common stock   109,916,700   109,916           --        --       (64,916)         --

Beneficial conversion on convertible debentures                   --        --           --        --       125,000    (125,000)

Amortization of deferred equity based expense                     --        --           --        --            --     225,000

Net loss, November 30, 2003                                       --        --           --        --            --          --
                                                         -----------  --------  -----------   -------  ------------   ---------
BALANCE NOVEMBER 30, 2003                                357,674,858  $357,672    5,758,051   $21,544  $ 14,588,343   $ (87,500)
                                                         ===========  ========  ===========   =======  ============   =========
<CAPTION>
                                                         Accumulated
                                                            Deficit        Total
                                                         --------------------------
<S>                                                      <C>            <C>
Balance, February 28, 2003                               $(18,854,978)  $(4,536,128)

Common stock issued for cash                                       --        17,000

Common stock issued for services rendered                          --       248,224

Common stock to be issued per anti-dilution provision              --            --

Conversions of convertible secured debentures to
  common stock                                                     --        25,985

Conversions of notes and loans payable to common stock             --        45,000

Beneficial conversion on convertible debentures                    --            --

Amortization of deferred equity based expense                      --       225,000

Net loss, November 30, 2003                                (1,082,319)   (1,082,319)
                                                         ------------   -----------

BALANCE NOVEMBER 30, 2003                                $(19,937,297)  $(5,057,238)
                                                         ============   ===========
</TABLE>

      See accompanying notes to condensed consolidated financial statements


                                       6
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
               FOR THE NINE MONTHS ENDED NOVEMBER 30, 2003 & 2002
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                  2003          2002
                                                              -----------   -----------
<S>                                                           <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss                                                      $(1,082,319)  $(1,172,455)
Adjustments to reconcile net loss to net cash used in
  operating activities:
Depreciation                                                       13,086        17,792
Common stock issued for services rendered                         248,225       568,019
Amortization of deferred equity based expense                     225,000        75,000
Forgiveness of debt                                                    --       (70,778)
Loss on debt conversion                                                --        16,071
Changes in operating assets and liabilities:
Accounts receivable                                               (33,414)       39,658
Inventories                                                         9,532            --
Accounts payable and accrued expenses                             373,078       301,325
                                                              -----------   -----------
Net Cash Used In Operating Activities                            (246,812)     (225,368)
                                                              -----------   -----------

CASH FLOWS FROM INVESTING ACTIVITIES:                                  --            --
                                                              -----------   -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of convertible secured debentures          125,000       220,000
Proceeds from issuance of convertible subordinated debentures      43,000            --
Proceeds from the issues of common stock                           17,000        25,000
Repayment of notes and loans payable                               (3,477)      (30,096)
Proceeds from notes and loans payable                              71,000        49,863
Repayment of notes payable - related parties                      (36,930)      (23,896)
Proceeds from notes payable - related parties                      25,935         2,282
                                                              -----------   -----------
Net Cash Provided By Financing Activities                         241,528       243,153
                                                              -----------   -----------

NET (DECREASE) INCREASE IN CASH                                    (5,284)       17,785

CASH - BEGINNING OF PERIOD                                          6,600           139
                                                              -----------   -----------

CASH - END OF PERIOD                                          $     1,316   $    17,924
                                                              ===========   ===========
</TABLE>

      See accompanying notes to condensed consolidated financial statements


                                       7
<PAGE>

NOTE 1 NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      (A)   BASIS OF PRESENTATION

      These condensed consolidated statements have been prepared in accordance
      with accounting principles generally accepted in the United States of
      America for interim financial information and the instructions to Form
      10-QSB and do not include all the information and footnotes required by
      accounting principles generally accepted in the United States of America
      for complete financial statements. In the opinion of management, all
      adjustments (consisting of normal recurring accruals) considered necessary
      for a fair presentation of the results for the interim periods have been
      included. Operating results for the nine months ended November 30, 2003
      are not necessarily indicative of the results that may be expected for the
      year ended February 28, 2004. The accompanying condensed consolidated
      financial statements and the information included under the heading
      "Management's Discussion and Analysis" should be read in conjunction with
      the Company's audited consolidated financial statements and related notes
      included in the Company's Form 10-KSB for the year ended February 28,
      2003.

      (B)   PRINCIPLES OF CONSOLIDATION

      The condensed consolidated financial statements include the accounts of
      Collectible Concepts Group, Inc. and its two wholly owned subsidiaries,
      Team Sports Specialties Corporation and Music Art Corporation
      (collectively, the "Company"). All significant intercompany accounts and
      transactions have been eliminated in consolidation.

      (C)   USE OF ESTIMATES

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

      (D)   LOSS PER SHARE

      Basic and diluted loss per share for all periods presented is computed
      based on the weighted average number of common shares outstanding. The
      assumed conversions of convertible debentures into common stock and
      exercises of stock options was not included in the computation of diluted
      loss per share because the assumed conversions and exercises would be
      anti-dilutive.


                                       8
<PAGE>

      (E)   STOCK-BASED COMPENSATION

      SFAS No. 123, "Accounting for Stock-Based Compensation" encourages, but
      does not require, companies to record compensation cost for stock-based
      employee compensation plans at fair value. The Company has chosen to
      account for employee stock-based compensation using the intrinsic value
      method prescribed in Accounting Principles Board ("APB") Opinion No. 25,
      "Accounting for Stock Issued to Employees", and related interpretations.
      Accordingly, compensation cost for stock options is measured as the
      excess, if any, of the quoted market price of the Company's stock at the
      date of the grant over the amount an employee must pay to acquire the
      stock. The Company values shares issued in consideration of services at
      fair value. Options or warrants issued to non-employees and consultants
      are recorded using the fair value method, based on the Black-Scholes
      option-pricing model. There were no options issued to employees during the
      periods presented. Therefore, the required disclosure of pro forma amounts
      under SFAS No. 123, as modified by SFAS No. 148, "Accounting for
      Stock-Based Compensation - Transition and Disclosure", has not been
      presented.

      (F)   RECLASSIFICATIONS

      Certain items have been reclassified in prior period statements to conform
      to the current period presentation.

      (G)   RECENT ACCOUNTING PRONOUNCEMENTS

      In May 2003, the Financial Accounting Standards Board ("FASB") issued
      Statement of Financial Accounting Standards ("SFAS") No. 150, "Accounting
      For Certain Financial Instruments with Characteristics of both Liabilities
      and Equity". SFAS No. 150 changes the accounting for certain financial
      instruments with characteristics of both liabilities and equity that,
      under previous pronouncements, issuers could account for as equity. The
      new accounting guidance contained in SFAS No. 150 requires that those
      instruments be classified as liabilities in the balance sheet.

      SFAS No. 150 affects the issuer's accounting for three types of
      freestanding financial instruments. One type is a mandatory redeemable
      share, which the issuing company is obligated to buy back in exchange for
      cash or other assets. A second type includes put options and forward
      purchase contracts, which involves instruments that do or may require the
      issuer to buy back some of its shares in exchange for cash or other
      assets. The third type of instruments that are liabilities under this
      Statement is obligations that can be settled with shares, the monetary
      value of which is fixed, tied solely or predominantly to a variable such
      as a market index, or varies inversely with the value of the issuers'
      shares. SFAS No. 150 does not apply to features embedded in a financial
      instrument that is not a derivative in its entirety.


                                       9
<PAGE>

      Most of the provisions of Statement 150 are consistent with the existing
      definition of liabilities in FASB Concepts Statement No. 6, "Elements of
      Financial Statements". The remaining provisions of this Statement are
      consistent with the FASB's proposal to revise that definition to encompass
      certain obligations that a reporting entity can or must settle by issuing
      its own shares. This Statement shall be effective for financial
      instruments entered into or modified after May 31, 2003 and otherwise
      shall be effective at the beginning of the first interim period beginning
      after June 15, 2003, except for mandatory redeemable financial instruments
      of a non-public entity, as to which the effective date is for fiscal
      periods beginning after December 15, 2004.

      In January 2003, (as revised in December 2003) The Financial Accounting
      Standards Board ("FASB") issued Interpretation No. 46, "Consolidation of
      Variable Interest Entities", an interpretation of Accounting Research
      Bulletin ("ARB") No. 51, "Consolidated Financial Statements".
      Interpretation No. 46 addresses consolidation by business enterprises of
      variable interest entities, which have one or both of the following
      characteristics: (i) the equity investment at risk is not sufficient to
      permit the entity to finance its activities without additional
      subordinated support from other parties, which is provided through other
      interest that will absorb some or all of the expected losses of the
      entity; (ii) the equity investors lack one or more of the following
      essential characteristics of a controlling financial interest: the direct
      or indirect ability to make decisions about the entities activities
      through voting rights or similar rights; or the obligation to absorb the
      expected losses of the entity if they occur, which makes it possible for
      the entity to finance its activities; the right to receive the expected
      residual returns of the entity if they occur, which is the compensation
      for the risk of absorbing the expected losses.

      Interpretation No. 46, as revised, also requires expanded disclosures by
      the primary beneficiary (as defined) of a variable interest entity and by
      an enterprise that holds a significant variable interest in a variable
      interest entity but is not the primary beneficiary.

      Interpretation No. 46, as revised, applies to small business issuers no
      later than the end of the first reporting period that ends after December
      15, 2004. This effective date includes those entities to which
      Interpretation 46 had previously been applied. However, prior to the
      required application of Interpretation No. 46, a public entity that is a
      small business issuer shall apply Interpretation 46 or this Interpretation
      to those entities that are considered to be special-purpose entities no
      later than as of the end of the first reporting period that ends after
      December 15, 2003.

      Interpretation No. 46 may be applied prospectively with a
      cumulative-effect adjustment as of the date on which it is first applied
      or by restating previously issued financial statements for one or more
      years with a cumulative-effect adjustment as of the beginning of the first
      year restated.

      In March 2004, the U.S. Securities and Exchange Commission's Office of the
      Chief Accountant and the Division of Corporate Finance released Staff
      Accounting bulletin ("SAB") No. 105, "Loan Commitments Accounted for as
      Derivative Instruments". This bulletin contains specific guidance on the
      inputs to a valuation-recognition model to measure loan commitments
      accounted for at fair value, and requires that fair-value measurement
      include only differences between the guaranteed interest rate in the loan
      commitment and market interest rate, excluding any expected future cash
      flows related to the customer relationship or loan servicing. In addition,
      SAB105 requires the disclosure of the accounting policy for loan
      commitments, including methods and assumptions used to estimate the fair
      value of loan commitments, and any associated hedging strategies. SAB 105
      is effective for derivative instruments entered into subsequent to March
      31, 2004 and should also be applied to existing instruments as
      appropriate. The Company has not yet completed its evaluation of SAB 105,
      but does not anticipate a material impact on the financial statements.


                                       10
<PAGE>

      Management does not expect the adoption of these pronouncements to have a
      material impact on the Company's consolidated financial position or
      results of operations.

NOTE 2 GOING CONCERN

      The accompanying condensed consolidated financial statements have been
      prepared on a going concern basis which contemplates the realization of
      assets and the settlement of liabilities and commitments in the normal
      course of business. Since inception, the Company has not generated
      sufficient revenues to meet its operating expenses and has incurred
      significant operating losses and net losses. As of and for the nine months
      ended November 30, 2003, the Company had a working capital deficiency of
      $5,082,248, a shareholders' deficiency of $5,057,238, a net loss of
      $1,082,319 and net cash used in operations of $246,812. The Company has
      minimal cash available for operations and is in default with respect to
      repayment provisions of certain secured and subordinated debentures. In
      addition, the Company was not able to complete an effective registration
      statement within 150 days as required in connection with the sale of
      convertible secured debentures to a group of investors and, as a result,
      the Company is in default of the debenture agreement. These matters raise
      substantial doubt about the Company's ability to continue as a going
      concern. The condensed consolidated financial statements do not include
      any adjustments relating to the recoverability and classification of
      recorded assets, or the amounts and classification of liabilities that
      might be necessary in the event the Company cannot continue in existence.

      In order to generate additional revenues and the working capital needed to
      continue and expand operations, the Company's management has committed to
      a plan for reducing expenses, increasing retail distribution channels for
      its products and raising additional capital. There can be no assurances
      that the Company will be able to obtain the necessary funding to finance
      their operations or grow revenue in sufficient amounts to fund their
      operating expenses (See Note 10).

NOTE 3 CONVERTIBLE SECURED DEBENTURES

      In May 2000, the Company issued $400,000 of secured convertible debentures
      to a group of investors. These debentures matured in April 2001, are
      secured by substantially all of the Company's assets and bear interest at
      10% per annum, payable quarterly; the debentures are convertible into
      common stock at any time at the holder's option at the lesser of $2.80 or
      50% of market value (the debt discount of $65,000 assigned to this
      beneficial conversion feature was recorded as additional paid-in capital
      and the debt discount was amortized as interest expense in the quarter
      ended May 31, 2000 because the debentures are convertible at any time at
      the holder's option); the debentures also have warrants to purchase 57,143
      shares of common stock at 110% of the market value on the closing date -
      the warrants have a five-year life and are exercisable immediately (using
      an option pricing model, the warrants were valued at $280,000 using the
      following assumptions: no expected payment of dividends, expected lives of
      warrants of three years, a risk free rate of 6.5% and a volatility of
      75%). The $280,000 was recorded as additional paid-in capital and the debt
      discount was amortized to interest expense over the term of the related
      debentures. As of February 28, 2002, the debt discount had been fully
      amortized. The debenture holders also have certain rights in the event the
      Company files a registration statement. The Company was not able to
      complete an effective registration statement within 150 days of the
      debenture sale. As a result, the Company is in default of the debenture
      agreement. As of the date of this report, these debentures are still
      unpaid and in default.


                                       11
<PAGE>

      On May 28, 2002, the Company issued  $75,000 of convertible secured
      debentures to a group of investors with a conversion price of 50% of the
      average of the lowest three intraday trading prices during the twenty days
      immediately preceding conversion. This results in a beneficial conversion
      feature of $75,000, which has been fully recognized as an expense at
      February 28, 2003. The debentures bear interest of 12% simple interest per
      annum and matured on July 28, 2003. The debentures are convertible into
      shares of the Company's common stock at any time at the holder's option
      equal to the quotient of (a) the aggregate amount of the principle and
      accrued interest and unpaid interest to be so converted by (b) the
      conversion price. As of the date of this report, these debentures are
      still unpaid and in default.

      On November 26, 2002, the Company issued $250,000 of convertible secured
      debentures to a group of investors. These debentures mature on November
      26, 2003 and bear interest at 15% per annum and are convertible into
      shares of the Company's common stock at the lower of $.01 or 25% of the
      average of the lowest three intraday trading prices during the twenty
      trading days immediately preceding conversion. This results in a
      beneficial conversion feature in the amount of $250,000, (since it is
      limited to the amount received) which is being amortized over the term of
      the loan. Of this amount $187,500 was amortized to expense during the nine
      months ended November 30, 2003 and $0 remains deferred as of November 30,
      2003.

      On May 13, 2003, the Company issued $25,000 of convertible secured
      debentures to a group of investors. These debentures mature on May 13,
      2004 and bear interest at 15% per annum and are convertible into shares of
      the Company's common stock at the lower of $.01 or 25% of the average of
      the lowest three intraday trading prices during the twenty trading days
      immediately preceding conversion. This results in a beneficial conversion
      feature in the amount of $25,000, (since it is limited to the amount
      received) which is being amortized over the term of the loan. Of this
      amount $12,500 was amortized to expense to expense during the nine months
      ended November 30, 2003 and $12,500 remains deferred as of November 30,
      2003.


                                       12
<PAGE>

      On June 25, 2003, the Company issued $25,000 of convertible secured
      debentures to a group of investors. These debentures mature on June 25,
      2004 and bear interest at 15% per annum and are convertible into shares of
      the Company's common stock at the lower of $.01 or 25% of the average of
      the lowest three intraday trading prices during the twenty trading days
      immediately preceding conversion. This results in a beneficial conversion
      feature in the amount of $25,000, (since it is limited to the amount
      received) which is being amortized over the term of the loan. Of this
      amount $12,500 was amortized to expense to expense during the nine months
      ended November 30, 2003 and $12,500 remains deferred as of November 30,
      2003.

      On July 18, 2003, the Company issued $25,000 of convertible secured
      debentures to a group of investors. These debentures mature on July 18,
      2004 and bear interest at 15% per annum and are convertible into shares of
      the Company's common stock at the lower of $.01 or 25% of the average of
      the lowest three intraday trading prices during the twenty trading days
      immediately preceding conversion. This results in a beneficial conversion
      feature in the amount of $25,000, (since it is limited to the amount
      received) which is being amortized over the term of the loan. Of this
      amount $12,500 was amortized to expense to expense during the nine months
      ended November 30, 2003 and $12,500 remains deferred as of November 30,
      2003.

      On November 17, 2003, the Company issued $50,000 of convertible secured
      debentures to a group of investors. These debentures mature on November
      17, 2004 and bear interest at 15% per annum and are convertible into
      shares of the Company's common stock at the lower of $.01 or 25% of the
      average of the lowest three intraday trading prices during the twenty
      trading days immediately preceding conversion. This results in a
      beneficial conversion feature in the amount of $50,000, (since it is
      limited to the amount received) which is being amortized over the term of
      the loan. The entire beneficial conversion expense of $50,000 has been
      deferred as of November 30, 2003.

      The following schedule reflects convertible secured debentures as of
      November 30, 2003 (in order of due date):

      10% convertible secured debentures, due April 2001
      (net of conversions) (A)                                     $341,715

      12% convertible secured debentures, due July 2003 (A)          75,000

      15% convertible secured debentures, due November 2003 (A)     250,000

      15% convertible secured debentures, due May 2004 (A)           25,000

      15% convertible secured debentures, due June 2004 (A)          25,000

      15% convertible secured debentures, due July 2004 (A)          25,000

      15% convertible secured debentures, due November 2004          50,000
                                                                   --------
      Total                                                        $791,715
                                                                   ========


                                       13
<PAGE>

      (A)   In default as of the date of the filing of this Form 10-QSB.

NOTE 4 NOTES AND LOANS PAYABLE

      As of November 30, 2003, notes and loans payable consisted of various
      unsecured notes and loans payable to certain individuals, investors and an
      auto finance company. The notes and loans bear interest at various rates
      ranging from 8.0% to 12.0% and had various maturities through August 2001,
      except for the automobile loan, which matures February 28, 2006. The
      balance of the notes and loans payable, with the exception of the auto
      loan, are in default and remain unpaid as of November 30, 2003.

      The Company has loans payable of $86,050, which are included as loans
      payable - related parties in the accompanying condensed consolidated
      balance sheet, due to the Company's president and other related parties as
      of November 30, 2003. During the nine months ended November 30, 2003, the
      Company recorded interest expense of $3,866 relating to loans from its
      president and other related parties and $86,094 in accrued interest was
      payable relating to these loans as of November 30, 2003 which is included
      in accrued expenses in the accompanying condensed consolidated balance
      sheet (See Note 8).

NOTE 5 CONVERTIBLE SUBORDINATED DEBENTURES

      The Company has outstanding $71,800 of convertible subordinated debentures
      that bear interest at 12% per annum and matured at various times through
      August 2001. The debentures are in default and remain unpaid. Each $1,000
      unit is convertible at any time at the holder's option, into between 143
      and 1,429 shares of Company common stock for an aggregate of 38,214 common
      shares.

      The Company issued an additional $43,000 of convertible subordinated
      debentures during the three months ended May 31, 2003. The debentures bear
      interest at 12% per annum and have a term of one year. Subsequent to
      November 30, 2003, the debentures were not paid at the due date and are in
      default. Each $1,000 unit is convertible at any time at the holder's
      option, into 1,000,000 shares of Company common stock for an aggregate of
      43,000,000 common shares.


                                       14
<PAGE>

      The following schedule reflects convertible subordinated debentures as of
      November 30, 2003 (in order of due date):

      12% convertible subordinated debentures,  unsecured, due at
      various times through August 2001 (A)                             $ 71,800

      12% convertible subordinated debentures,  unsecured, due at         43,000
      various times through May 31, 2004 (A)
                                                                        --------

      Total                                                             $114,800
                                                                        ========

      (A) In default

NOTE 6 COMMON STOCK

      In October 2001, the Company entered into an agreement with a third party
      whereby the third party has an anti-dilution ownership of 1.603% of the
      Company. The Company has not issued 5,758,051 shares owed as of November
      30, 2003, to the third party. These shares are shown as common stock to be
      issued with a corresponding decrease to additional paid in capital, for
      all periods presented (see Note 10).

      During the nine months ended November 30, 2003, the Company converted
      $25,985 of convertible secured debentures into 38,868,751 shares of common
      stock. The conversions of debt to stock were based upon negotiated
      conversion prices with the debtors. Based on sales of common stock for
      cash during the nine months ended November 30, 2003 for prices below
      market value, no gain or loss has been recognized on the aforementioned
      conversions of convertible secured debentures.

      During the nine months ended November 30, 2003, the Company converted
      $45,000 of notes and loans payable into 109,916,700 shares of common
      stock. The conversions of debt to stock were based upon negotiated
      conversion prices with the debtors. Based on sales of common stock for
      cash during the nine months ended November 30, 2003 for prices below
      market value, no gain or loss has been recognized on the aforementioned
      conversions of notes and loans payable.

      During the nine months ended November 30, 2003, the Company received
      $17,000 from the issuance of 9,714,286 shares of common stock through
      private placements to various investors.

      From time to time, the Company has issued common stock in exchange for the
      performance of services or as an alternative to the payment of interest on
      outstanding debt, internal accounting and financial services, internet
      website creation, marketing, insurance program review and general
      management consulting. The dollar value of these activities included in
      the selling, general and administrative expenses was $248,224 and $568,019
      for the nine months ended November 30, 2003 and 2002, respectively. These
      transactions have been recorded at the fair value of the services rendered
      or the fair value of the common stock issued, whatever was more readily
      evident. The number of shares of common stock issued for services
      performed in the nine months ended November 30, 2003 and 2002 was
      99,775,000 and 32,521,570, respectively.


                                       15
<PAGE>

NOTE 7 COMMITMENTS AND CONTINGENCIES

      (A) LICENSES

      The Company has entered into various licensing agreements (the
      "Agreements") for the right to manufacture, sell and distribute certain
      collectibles and novelties relating to current and future movie
      characters, as well as certain accessories containing logos and names of
      professional minor league and college sports teams. The Agreements expire
      at various dates through 2003 and generally require the Company to pay a
      royalty of between 9% and 11% of sales, with certain minimum royalty
      payments required. The unpaid minimum royalty fees related to these
      agreements of $381,250 are included in accrued expenses in the
      accompanying condensed consolidated balance sheet.

      On November 8, 2003, the Company replaced its Joint Venture Agreement with
      Pivotec, a Division of Pivotal Self Service Technologies, Inc. and entered
      into a new Services Agreement with Pivotec whereby the Company will assist
      Pivotec in obtaining licenses and managing other aspects of the business
      of selling licensed flashlight and battery products. Any licenses obtained
      in this manner will be assigned to Pivotec. This Services Agreement
      provides a 1% royalty to the Company on net sales of any flashlight and/or
      battery products containing images available either from licenses the
      Company has, or assisted in obtaining, for Pivotec. Additionally, the
      Company may sell these licensed products and will receive a sales
      commission based on a formula of several variables that is expected to
      produce an average commission of 15% of the sales price. This dissolution
      of the Joint Venture Agreement had no effect on the Company's financial
      statements because there was no activity in the joint venture during the
      period it existed.

      (B) CONTINGENCIES

      In fiscal 2002, a licensing company commenced a lawsuit for various causes
      of action for breach of contract and trademark infringement, seeking a
      permanent injunction precluding the Company from using any of the
      plaintiffs' intellectual property. The Company consented to the entry of a
      permanent injunction and the parties entered into a settlement agreement,
      which resulted in the dismissal of the action in the subsequent period.
      However, despite the dismissal of the action, the plaintiff reserves the
      right to pursue monetary claims against the Company for its breach of
      various license agreements.

      (C) CONCENTRATIONS

      Approximately 92% and 44% of the Company's revenues were derived from its
      three largest customers during the three months ended November 30, 2003
      and 2002, respectively.

      Approximately 47% and 70% of the Company's revenues were derived from its
      three largest customers during the nine months ended November 30, 2003 and
      2002, respectively.

      The Company obtains a significant portion of its new borrowings from one
      investor group. During the nine months ended November 30, 2003, the
      Company borrowed $125,000 from this investor group. As of November 30,
      2003, a total of $791,715 was owed to this investor group (See Note 3).


                                       16
<PAGE>

      (D) OTHER CONTINGENCIES

      The Company is non-compliant with respect to payment of employee and
      employer payroll-related taxes. The liability is $205,252 as of November
      30, 2003, which includes penalties and interest and is included in accrued
      expenses.

NOTE 8 RELATED PARTY TRANSACTIONS

      The Company has an employment agreement with its president, who has
      elected to defer a portion of his salary in support of the cash needs of
      the Company. As of November 30, 2003, the amount of salary deferred was
      $416,375, which is included in accrued expenses. The Company has also
      issued stock options to the president.

      The Company has loans payable of $86,050, which is included in loans
      payable - related parties in the accompanying condensed consolidated
      balance sheet, due to the Company's president and other related parties as
      of November 30, 2003. During the nine months ended November 30, 2003, the
      Company recorded interest expense of $3,866 relating to loans from its
      president and other related parties and $86,094 in accrued interest was
      payable relating to these loans as of November 30, 2003 which is included
      in accrued expenses in the accompanying condensed consolidated balance
      sheet.

NOTE 9 SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES
       IN THE STATEMENTS OF CASH FLOWS

      During the nine months ended November 30, 2003, the Company converted
      $25,985 of convertible secured debentures into 38,868,751 shares of common
      stock.

      During the nine months ended November 30, 2003, the Company converted
      $45,000 of notes and loans payable into 109,916,700 shares of common
      stock.

      Cash payments for interest expense were immaterial for the nine months
      ended November 30, 2003 and 2002.

NOTE 10 SUBSEQUENT EVENTS

      Subsequent to November 30, 2003, the Company at various dates issued
      secured convertible debentures totaling $175,000 to a group of investors.
      These debentures mature one year from the date of issuance, bear interest
      at 15% per annum and are convertible into shares of the Company's common
      stock at the lesser of $.01 or 25% of the average of the lowest three
      intraday trading prices during the twenty trading days immediately
      preceding conversion.

      In December 2003, the Company and an employee entered into a five-year
      Employment Agreement under which the employee is to receive a weekly
      salary of $500. Additionally, 20,000,000 stock options are to be granted
      at exercise prices ranging from $.001 to $.004 per share. The options have
      a ten-year term. An additional 3,200,000 shares of our common stock are to
      be issued on or before the termination of the employment agreement.
      Compensation afforded to the employee under the agreement will also
      satisfy any and all indebtedness to the employee. The amount of this debt
      is estimated to be $219,530.


                                       17
<PAGE>

      Subsequent to November 30, 2003, the Company issued 68,352,100 shares of
      common stock to various individuals, in exchange for services rendered.

      Subsequent to November 30, 2003, the Company issued 109,279,939 shares of
      common stock to convert $35,400 of debt.

      Subsequent to November 30, 2003, the Company issued 7,300,000 shares of
      common stock as part of the shares owed at that date to a third party that
      has a 1.603% anti-dilution ownership in the Company (See Note 6).

      In June 2004, the Company issued senior secured convertible redeemable
      notes totaling $550,000 to a group of investors. These notes mature two
      years from the date of issuance, bear interest at 15% per annum and are
      convertible into shares of the Company's common stock at $ .01 or 50%
      discount from the lowest bid price over the three trading days during the
      twenty days preceding conversion.


                                       18
<PAGE>

The following discussion should be read in conjunction with the unaudited
condensed consolidated financial statements and notes thereto set forth in Item
1of this Quarterly Report. In addition to historical information, this
discussion and analysis contains forward-looking statements that involve risks,
uncertainties and assumptions, which could cause actual results to differ
materially from Management's expectations. Factors that could cause differences
include, but are not limited to, expected market demand for the Company's
services, fluctuations in pricing for products distributed by the Company and
services offered by competitors, as well as general conditions of the
marketplace.

ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

      Some of the information in this Form 10-QSB contains forward-looking
statements that involve substantial risks and uncertainties. You can identify
these statements by forward-looking words such as "may," "will," "expect,"
"anticipate," "believe," "estimate" and "continue," or similar words. You should
read statements that contain these words carefully because they:

      o     discuss our future expectations;
      o     contain projections of our future results of operations or of our
            financial condition; and
      o     state other "forward-looking" information.

      We believe it is important to communicate our expectations. However, there
may be events in the future that we are not able to accurately predict or over
which we have no control. Our actual results and the timing of certain events
could differ materially from those anticipated in these forward-looking
statements as a result of certain factors, including those set forth in our
filings with the Securities and Exchange Commission.

GENERAL

      The following detailed analysis of operations should be read in
conjunction with the 2003 audited consolidated financial statements and related
notes included in the Company's Form 10-KSB for the year ended February 28,
2003.

      During the quarter ended May 31, 2003, the Company focused on the new
genre of films being so heavily oriented to characters of comic books and
fantasies. The Company pursued licenses mostly in that category and will
supplement them with new trend properties as they appear. Management recognizes
however, that the Company does not have the financial resources to engage in
product development and manufacturing activities.

      In August 2003, the Company re-evaluated its business model. The Company
believes that licenses have evolved into less time sensitive and sale spiking
properties. The Company is not renewing or continuing licenses that do not fit
its new business model. The Company's new business model will be focused on more
evergreen properties and those with a longer window of opportunity. The Company
recognized the need to have products that addressed the mainstream consumer
market where market size and repeat sales opportunities could give the Company a
means to stabilize and grow its revenues. To avoid the time, expense and risks
associated with in-house new product development, the Company sought out
entities with mainstream consumer products whose marketability could be enhanced
by the addition of the Company's licenses. These activities produced new joint
ventures and products that addressed new markets in keeping with the Company's
new marketing direction aimed at the collegiate and professional sports
marketplaces.


                                       19
<PAGE>

ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS (CONTINUED)

      On November 8, 2003, the Company dissolved its Joint Venture Agreement
with Pivotec, a Division of Pivotal Self Service Technologies, Inc. and entered
into a new Royalty and Services Agreement with them. Under the terms of the new
agreement, the Company sold the Mighty Volt trade name and all intellectual
property rights developed by the Company in the previous joint venture with
Pivotal Self Service Technologies, Inc. in exchange for 500,000 restricted
shares of Pivotal Self Service Technologies, Inc. common stock. The Company will
assist Pivotec in obtaining licenses and managing other aspects of the business
of selling licensed flashlight and battery products. Any licenses obtained in
this manner will be assigned to Pivotec. This agreement provides a 1% royalty to
the Company on net sales of any flashlight and/or battery products containing
images available either from licenses the Company has or assisted in obtaining
for Pivotec. Additionally, the Company may sell these licensed products and will
receive a sales commission based on a formula of several variables that is
expected to produce an average commission of 15% of the sale price. The
agreement also contains a provision in which Pivotec paid the Company $16,000
for services it performed in obtaining licenses. This payment was credited
against the outstanding royalty guarantee in the T-3 license agreement. The
Company renegotiated the total advance on the guarantee amount to $25,000 from
the original amount of $50,000. Under the agreement, the Company will retain
ownership of the T-3 license.

      During the three months ended November 30, 2003, the Company issued
$50,000 in convertible secured debentures that bear interest at 15% per annum
and a year maturity and are convertible into shares of the Company's common
stock at the lower of $.01 or 25% of the average of the lowest three intraday
trading prices during the twenty trading days immediately preceding conversion.
The funds are held in escrow and made available to the Company "as needed" on a
draw down basis each month. The investor also agreed to purchase an additional
$175,000 in convertible secured notes upon the Company's completion of all
reporting requirements with the Securities and Exchange Commission (SEC) and the
filing of a registration statement with the SEC covering the shares of common
stock underlying the convertible debentures.

CRITIAL ACCOUNTING POLICIES

      Our financial statements are prepared based on the application of
accounting principles generally accepted in the United States of America. These
accounting principles require us to exercise significant judgment about future
events that affect the amounts reported throughout our financial statements.
Actual events could unfold quite differently than our previous judgments had
predicted. Therefore the estimates and assumptions inherent in the financial
statements included in this report could be materially different once those
actual events are known. We believe the following policies may involve a higher
degree of judgment and complexity in their application and represent critical
accounting policies used in the preparation of our financial statements. If
different assumptions or estimates were used, our financial statements could be
materially different from those included in this report.

      Revenue Recognition: We recognize revenues in accordance with Staff
Accounting Bulletin 104, Revenue Recognition in Financial Statements (SAB 104).
We develop and sell collectibles in the entertainment, sports and music markets.
Revenue from such product sales is recognized when persuasive evidence of an
arrangement exists, delivery has occurred, the fee is fixed or determinable and
collectibility is probable. At this time the earnings process is complete and
the risks and rewards of ownership have transferred to the customer, which is
generally when the goods are shipped and all significant obligations of the
Company have been satisfied.

      Accounts Receivable: We must make judgments about the collectibility of
our accounts receivable to be able to present them at their net realizable value
on the balance sheet. To do this, we carefully analyze the aging of our customer
accounts, try to understand why accounts have not been paid, and review
historical bad debt problems. From this analysis, we record an estimated
allowance for receivables that we believe will ultimately become uncollectible.


                                       20
<PAGE>

ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS (CONTINUED)

      Realizability of Inventory Values: We make judgments about the ultimate
realizability of our inventory in order to record our inventory at its lower of
cost or market. These judgments involve reviewing current demand for our
products in comparison to present inventory levels and reviewing inventory costs
compared to current market values.

      Long-lived Assets. We assess the impairment of long-lived assets whenever
events or changes in circumstances indicate that their carrying value may not be
recoverable from the estimated future cash flows expected to result from their
use and eventual disposition. Our long-lived assets subject to this evaluation
include property and equipment and amortizable intangible assets. Intangible
assets other than goodwill are reviewed for impairment whenever events or
changes in circumstances indicate that the carrying value may not be fully
recoverable. We are required to make judgments and assumptions in identifying
those events or changes in circumstances that may trigger impairment.

RECENT ACCOUNTING PRONOUNCEMENTS

      In May 2003, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 150, "Accounting For
Certain Financial Instruments with Characteristics of both Liabilities and
Equity". SFAS No. 150 changes the accounting for certain financial instruments
with characteristics of both liabilities and equity that, under previous
pronouncements, issuers could account for as equity. The new accounting guidance
contained in SFAS No. 150 requires that those instruments be classified as
liabilities in the balance sheet.

      SFAS No. 150 affects the issuer's accounting for three types of
freestanding financial instruments. One type is a mandatory redeemable share,
which the issuing company is obligated to buy back in exchange for cash or other
assets. A second type includes put options and forward purchase contracts, which
involves instruments that do or may require the issuer to buy back some of its
shares in exchange for cash or other assets. The third type of instruments that
are liabilities under this Statement is obligations that can be settled with
shares, the monetary value of which is fixed, tied solely or predominantly to a
variable such as a market index, or varies inversely with the value of the
issuers' shares. SFAS No. 150 does not apply to features embedded in a financial
instrument that is not a derivative in its entirety.

      Most of the provisions of Statement 150 are consistent with the existing
definition of liabilities in FASB Concepts Statement No. 6, "Elements of
Financial Statements". The remaining provisions of this Statement are consistent
with the FASB's proposal to revise that definition to encompass certain
obligations that a reporting entity can or must settle by issuing its own
shares. This Statement shall be effective for financial instruments entered into
or modified after May 31, 2003 and otherwise shall be effective at the beginning
of the first interim period beginning after June 15, 2003, except for mandatory
redeemable financial instruments of a non-public entity, as to which the
effective date is for fiscal periods beginning after December 15, 2004.

      In January 2003, (as revised in December 2003) The Financial Accounting
Standards Board ("FASB") issued Interpretation No. 46, "Consolidation of
Variable Interest Entities", an interpretation of Accounting Research Bulletin
("ARB") No. 51, "Consolidated Financial Statements". Interpretation No. 46
addresses consolidation by business enterprises of variable interest entities,
which have one or both of the following characteristics: (i) the equity
investment at risk is not sufficient to permit the entity to finance its
activities without additional subordinated support from other parties, which is
provided through other interest that will absorb some or all of the expected
losses of the entity; (ii) the equity investors lack one or more of the
following essential characteristics of a controlling financial interest: the
direct or indirect ability to make decisions about the entities activities
through voting rights or similar rights; or the obligation to absorb the
expected losses of the entity if they occur, which makes it possible for the
entity to finance its activities; the right to receive the expected residual
returns of the entity if they occur, which is the compensation for the risk of
absorbing the expected losses.


                                       21
<PAGE>

ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS (CONTINUED)

      Interpretation No. 46, as revised, also requires expanded disclosures by
the primary beneficiary (as defined) of a variable interest entity and by an
enterprise that holds a significant variable interest in a variable interest
entity but is not the primary beneficiary.

      Interpretation No. 46, as revised, applies to small business issuers no
later than the end of the first reporting period that ends after December 15,
2004. This effective date includes those entities to which Interpretation 46 had
previously been applied. However, prior to the required application of
Interpretation No. 46, a public entity that is a small business issuer shall
apply Interpretation 46 or this Interpretation to those entities that are
considered to be special-purpose entities no later than as of the end of the
first reporting period that ends after December 15, 2003

      Interpretation No. 46 may be applied prospectively with a
cumulative-effect adjustment as of the date on which it is first applied or by
restating previously issued financial statements for one or more years with a
cumulative-effect adjustment as of the beginning of the first year restated.

      In March 2004, the U.S. Securities and Exchange Commission's Office of the
Chief Accountant and the Division of Corporate Finance released Staff Accounting
bulletin ("SAB") No. 105, "Loan Commitments Accounted for as Derivative
Instruments". This bulletin contains specific guidance on the inputs to a
valuation-recognition model to measure loan commitments accounted for at fair
value, and requires that fair-value measurement include only differences between
the guaranteed interest rate in the loan commitment and market interest rate,
excluding any expected future cash flows related to the customer relationship or
loan servicing. In addition, SAB105 requires the disclosure of the accounting
policy for loan commitments, including methods and assumptions used to estimate
the fair value of loan commitments, and any associated hedging strategies. SAB
105 is effective for derivative instruments entered into subsequent to March 31,
2004 and should also be applied to existing instruments as appropriate. The
Company has not yet completed its evaluation of SAB 105, but does not anticipate
a material impact on the financial statements.

      Management does not expect the adoption of these pronouncements to have a
material impact on the Company's consolidated financial position or results of
operations.

RESULTS OF OPERATIONS

NINE MONTHS ENDED NOVEMBER 30, 2003 COMPARED TO NINE MONTHS ENDED NOVEMBER 30,
2002.

      Net revenue for the nine months ended November 30, 2003 was $127,773
compared to net revenue of $53,883 for the nine months ended November 30, 2002.
The increase in revenue was due primarily to the sales in X-Men and Terminator
products that offset the loss of sales in products from Lord Of The Rings.

      Cost of sales for the nine months ended November 30, 2003 increased by
$36,225 from $77,814 for the nine months ended November 30, 2002 to $114,039 for
the nine months ended November 30, 2003. This increase in the cost of sales was
related to a corresponding increase in the sales volume compared to the same
period in 2002. Cost of sales as a percentage of revenues decreased to 89.3%
for the nine months ended November 30, 2003 as compared to 144.4% for the same
period last year. The decrease as a percentage is mainly attributable to the
sales of products that were developed in the previous year, resulting is lower
expenses as a result of having the products already produced instead of
production charges during this quarter.


                                       22
<PAGE>

ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS (CONTINUED)

      Selling, general and administrative expenses for the nine months ended
November 30, 2003 decreased to $789,127 from $1,061,163 for the same period the
previous year. For the nine months ended November 30, 2003 and 2002, the
services obtained through the issuance of stock include internal accounting and
financial services, internet website creation, marketing assistance, insurance
program review and general management consulting services in the amount of
$248,225 and $568,019 respectively. As previously mentioned, the Company incurs
charges to bring the product to market. These charges relate to the costs of
producing samples as well as the related package design costs that must be
approved by the licensor prior to full production runs of the product. For the
nine months ended November 30, 2003, the Company incurred charges relating to
the costs of producing the samples as well as the related package design of
approximately $19,231 versus charges of approximately $4,048 for the same period
the previous year.

      The Company incurred interest expense of $331,926 for the nine months
ended November 30, 2003 as compared to $142,068 for the same period the previous
year due to increased borrowings and the beneficial conversion calculation
related to the application of the EITF ("Emerging Issues Task Force") Bulletin
for accounting of convertible securities and notes and loans payable with
beneficial conversion features. The beneficial conversion calculation added
$225,000 and $75,000 of interest expense respectively for the nine months ended
November 30, 2003 and 2002, respectively.

      As a result of the above, the Company had a net loss of $1,082,319 for the
nine months ended November 30, 2003 as compared to a net loss of $1,172,455 for
the same period last year.

THREE MONTHS ENDED NOVEMBER 30, 2003 COMPARED TO THREE MONTHS ENDED NOVEMBER 30,
2002.

      Net revenue for the three months ended November 30, 2003 was $40,957
compared to net revenue of $4,894 for the three months ended November 30, 2002.
The increase in revenue was due primarily to the sales in X-Men and Terminator
products that offset the loss of sales in products from Lord Of The Rings.

      Cost of sales for the three months ended November 30, 2003 increased by
$45,309 from $6,805 for the three months ended November 30, 2002 to $52,114 for
the three months ended November 30, 2003. This increase in the cost of sales was
related to a corresponding increase in the sales volume compared to the same
quarter in 2002. Cost of sales as a percentage of revenues decreased to 127.2%
for the three months ended November 30, 2003 as compared to 139.0% for the same
period last year. The decrease as a percentage is mainly attributable to the
sales of products that were developed in the previous year, resulting is lower
expenses as a result of having the products already produced instead of
production charges during this quarter.

      Selling, general and administrative expenses for the three months ended
November 30, 2003 increased to $306,736 from $224,606 for the same period the
previous year. For the three months ended November 30, 2003 and 2002, the
services obtained through the issuance of stock included internal accounting and
financial services, internet website creation, marketing assistance, insurance
program review and general management consulting services in the amount of
approximately $118,025 and $28,600 respectively. As previously mentioned, the
Company incurs charges to bring the product to market. These charges relate to
the costs of producing samples as well as the related package design costs that
must be approved by the licensor prior to full production runs of the product.
For the three months ended November 30, 2003, the Company incurred charges
relating to the costs of producing prototypes and preliminary packaging design
for a sculpted Spiderman flashlight product that the Company anticipates
marketing in the next year.


                                       23
<PAGE>

ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS (CONTINUED)

      The Company incurred interest expense of $118,587 for the three months
ended November 30, 2003 as compared to $24,917 for the same period the previous
year due to increased borrowings and the beneficial conversion calculation
related to the application of the EITF ("Emerging Issues Task Force") Bulletin
for accounting of convertible securities and notes and loans payable with
beneficial conversion features. The beneficial conversion calculation added
$81,250 and $0 of interest expense respectively for the three months ended
November 30, 2003 and 2002, respectively.

      As a result of the above, the Company had a net loss of $420,480 for the
three months ended November 30, 2003 as compared to a net loss of $267,505 for
the same period last year.

LIQUIDITY AND CAPITAL RESOURCES

      Since the Company's inception, it has experienced significant operating
and net losses that it has been able to fund by obtaining private capital. The
Company, therefore, cannot predict if and when it will generate income from
operations and if it will be able to raise sufficient capital necessary to fund
future operations. As of November 30, 2003, the Company has not generated
sufficient revenues to meet operating expenses. As a result, there is
substantial doubt about the Company's ability to continue as a going concern. We
anticipate that we will require up to approximately $1,000,000 to fund our
continued operations for the next twelve months, depending on revenues from
operations.

      As of November 30, 2003, the Company had a working capital deficiency of
$5,082,248. The working capital deficit increased from February 28, 2003 as a
direct result of the unprofitable operations for the nine months ended November
30, 2003 that resulted in cash used in operating activities of $246,812. The
Company had an ending cash balance of $1,316 at November 30, 2003.

      The Company has financed its losses through private sales of equity and
debt securities and the issuance of stock for services. During the nine months
ended November 30, 2003, the Company received the following capital infusions:
$17,000 from issuance of common stock and exercise of stock options, $125,000
from the issuance of convertible secured debentures, $43,000 from the issuance
of convertible subordinated debentures, $71,000 from notes and loans payable and
$25,935 from other borrowings. During the nine months ended November 30, 2003,
the Company made repayments of $40,407.

      To obtain funding for our ongoing operations, we entered into a Securities
Purchase Agreement with accredited investors on May 13, 2003, June 25, 2003 and
July 18, 2003 each for the sale of $25,000 and on November, 17 2003 for $50,000
in secured convertible notes. The secured convertible notes bear interest at
15%, mature one year from the date of issuance, and are convertible into our
common stock, at the investors' option, at the lower of (i) $0.01 or (ii) 75% of
the average of the three lowest intraday trading prices for the common stock on
a principal market for the 20 trading days before but not including the
conversion date. The full principal amount of the secured convertible notes is
due upon default under the terms of secured convertible notes. In addition, we
have granted the investors a security interest in substantially all of our
assets and intellectual property and registration rights.

      The Company issued an additional $43,000 of convertible subordinated
debentures during the nine months ended November 30, 2003. The debentures bear
interest at 12% per annum and have a term of one year. Each $1,000 unit is
convertible at any time at the holder's option, into 1,000,000 shares of Company
common stock for an aggregate of 43,000,000 common shares.


                                       24
<PAGE>

ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS (CONTINUED)

      An event of default has occurred regarding various convertible secured
debentures and convertible subordinated debentures in that the Company did not
have an effective registration statement within 150 days of the sale of
convertible debentures. As a result of this default, the Company is obligated to
pay the debenture holders the principal amount of the debentures together with
interest and certain other amounts. The Company does not have the capital
resources to pay the amounts required under this agreement. The secured
convertible debenture holders have informed the Company that they do not intend
to take any action at this time due to the default. The Company does not,
however, have any legally binding commitment from the debenture holders to waive
the default provision of the debentures. Subsequent to November 30, 2003, the
convertible secured debenture holders converted $10,380 of this debt into
20,296,857 shares of the Company's common stock and issued another $175,000 in
convertible secured debentures to the Company.

      As of November 30, 2003, the Company had $869,202 in outstanding notes and
loans payable, $114,800 in convertible subordinated debentures and $791,715 in
outstanding convertible secured debentures. As of November 30, 2003, the Company
had $1,494,375 in accounts payable, $1,868,455 in accrued expenses, accrued
payroll, accrued royalties and related taxes. These liabilities are for federal
withholding taxes and are related to calendar years 1999, 2000 and 2001. In July
2002, the Company reached an agreement with the Internal Revenue Service on a
payment plan for the back taxes owed. The plan called for the Company to make
twelve monthly payments of $5,272, followed by six monthly payments of $13,200,
followed by six monthly payments of $25,000. The Company made the first eleven
payments of $5,272, but defaulted on payments thereafter. In December 2002, the
Company began making monthly payments of $2,500, which the Company continues to
do when the funds are available. The Company has a verbal agreement with the IRS
that the Company will continue to make monthly payments of $2,500 with the
understanding that the Company will accelerate and increase these payments when
feasible, and the IRS will refrain from pursuing immediate payment in full. The
Company, however, does not have a written agreement with the IRS to these terms.

      The Company has been able to operate based on deferring vendor and
employee payments, deferring interest and debt repayments and obtaining
additional borrowings and proceeds from equity. However, there is no guarantee
that the Company will continue to be successful with respect to these actions.
Furthermore, there can be no assurances that the Company will be able to obtain
the necessary funding to finance their operations or grow revenue in sufficient
amounts to fund their operating expenses.


                                       25
<PAGE>

ITEM 3 - CONTROLS AND PROCEDURES

A) EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES. As of November 30, 2003,
the Company's management carried out an evaluation, under the supervision of the
Company's Chief Executive Officer and Principal Financial Officer of the
effectiveness of the design and operation of the Company's system of disclosure
controls and procedures pursuant to the Securities and Exchange Act, Rule
13a-15(e) and 15d-15(e) under the Exchange Act). Based upon that evaluation, the
Chief Executive Officer and Principal Financial Officer concluded that the
Company's disclosure controls and procedures were effective, as of the date of
their evaluation, for the purposes of recording, processing, summarizing and
timely reporting material information required to be disclosed in reports filed
by the Company under the Securities Exchange Act of 1934.

B) CHANGES IN INTERNAL CONTROLS. There were no changes in internal controls over
financial reporting, known to the Chief Executive Officer or Principal Financial
Officer that occurred during the period covered by this report that has
materially affected, or is likely to materially effect, the Company's internal
control over financial reporting.


                                       26
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES

                           PART II - OTHER INFORMATION

ITEM 1 LEGAL PROCEEDINGS

      From time to time, we may become involved in various lawsuits and legal
proceedings which arise in the ordinary course of business. However, litigation
is subject to inherent uncertainties, and an adverse result in these or other
matters may arise from time to time that may harm our business. we are currently
not aware of any such legal proceedings or claims that we believe will have,
individually or in the aggregate, a material adverse affect on our business,
financial condition or operating results.

ITEM 2 CHANGES IN SECURITIES AND USE OF PROCEEDS

      During the three months ended November 30, 2003, the Company issued
61,025,000 shares to several individuals for services rendered. The shares have
an aggregate fair market value of $118,025 based on the market price on the
dates of issuance. The Company issued 13,900,000 shares of stock in exchange for
$3,210 of convertible debentures.

      The Company relied upon the exemption provided in Section 4(2) of the
Securities Act of 1933 in connection with above-referenced transactions. The
Company relied on Section 4(2) with respect to these transactions as no public
solicitation was employed, the shares bore restrictive legends, and the
acquirers of the shares had access to the information which would be contained
in the Registration Statement and had sufficient sophistication so as not to
require the protection afforded by the Registration under the Securities Act.
Each of the purchasers of the Company's securities was given the opportunity to
ask question of and received answers from Company management. No commission or
other remuneration was paid or given in connection with the offer and sale of
the securities.

ITEM 3 DEFAULTS UPON SENIOR SECURITIES

      The Company is currently in default on all of its convertible secured
debentures that the Company has issued, in the total amount of $791,715. The
Company is also currently in default on all interest payments owed on these
secured convertible debentures. As a result of these defaults, the Company is
obligated to pay interest and certain other amounts. The Company does not have
the capital resources to pay the amounts required. The debenture holders have
informed the Company that they do not intend to take any action at this time due
to the default. The Company does not, however, have any legally binding
commitment from the debenture holders. The debentures are secured substantially
by all of the Company's assets.

ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

      Not applicable.

ITEM 5 OTHER INFORMATION

      Not applicable.


                                       27
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES

                           PART II - OTHER INFORMATION

ITEM 6 EXHIBITS AND REPORTS ON FORM 8-K

      (a) EXHIBITS.

            31.1 - Certification of Chief Executive Officer pursuant to Rule
            13a-14 and Rule 15d-14(a), promulgated under the Securities and
            Exchange Act of 1934, as amended

            31.2 - Certification of Chief Financial Officer pursuant to Rule
            13a-14 and Rule 15d 14(a), promulgated under the Securities and
            Exchange Act of 1934, as amended

            32.1 - Certification pursuant to 18 U.S.C. Section 1350, as adopted
            pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Chief
            Executive Officer)

            32.2 - Certification pursuant to 18 U.S.C. Section 1350, as adopted
            pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Chief
            Financial Officer)

      (b) REPORTS ON FORM 8-K.

            None.


                                       28
<PAGE>

                COLLECTIBLE CONCEPTS GROUP, INC. AND SUBSIDIARIES

                                   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.


                                        COLLECTIBLE CONCEPTS GROUP, INC.


Date: October 18, 2004                  By: /s/ PAUL S. LIPSCHUTZ
                                           -------------------------------------
                                           Paul S. Lipschutz
                                           Chief Executive Officer


Date: October 18, 2004                  By: /s/ PAUL S. LIPSCHUTZ
                                           -------------------------------------
                                           Paul S. Lipschutz
                                           Principal Financial Officer


                                       29