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 March 31, 2002
          --------------------------------------------------

[  ]      TRANSITION  REPORT  UNDER  SECTION  13 OR 15(d) OF THE EXCHANGE ACT
          For the transition period from _________________ to _________________


Commission  file  number:  333-412162


                                VHS NETWORK, INC.
        (Exact name of small business issuer as specified in its charter)

            FLORIDA                                          65-0656668
(State or other jurisdiction                               (IRS Employer
 of incorporation or organization)                        Identification No.)

                               301-5170 DIXIE ROAD
                      MISSISSAUGA, ONTARIO, CANADA L4W 1E3
                                 (905) 238-9398
                    (Address of principal executive offices)



                      APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common
equity,  as  of  the  latest practicable date: May 14, 2002 - 28,071,268

<PAGE>


                         PART I - FINANCIAL INFORMATION

ITEM  1.  FINANCIAL  STATEMENTS.

   VHS NETWORK, INC.

                        CONSOLIDATED FINANCIAL STATEMENTS

                MARCH 31, 2002 (UNAUDITED) AND DECEMBER 31, 2001


                CONTENTS                               PAGE

Consolidated  Balance  Sheets                           1.
Consolidated  Statements  of  Operations                2.
Consolidated  Statements  of  Shareholders'  Equity     3.
Consolidated  Statements  of  Cash  Flows               4.
Notes  to  the  Financial  Statements                   5.
<PAGE>

<TABLE>
<CAPTION>

                                VHS  NETWORK,  INC.
                           CONSOLIDATED BALANCE SHEETS
             AS OF MARCH 31, 2002 (UNAUDITED) AND DECEMBER 31, 2001

                                  March  31          December 31
                                     2002               2001
                                  ----------         -----------
<S>                                 <C>                 <C>
ASSETS
   Cash                            $     690          $   1,157
   Accounts  receivable                1,342             17,793
   Inventory                          99,600             96,304
                                  ----------         -----------
        Total  current  assets       101,632            115,254
                                  ----------         -----------

Property  and  equipment
     Furniture  and  equipment        35,520             35,520
     Accumulated  depreciation       (12,073)            (8,779)
                                  ----------         -----------
       Total property and equipment   23,447             26,741
                                  ----------         -----------
     Intangible  assets,  net        127,050            139,850
                                  ----------         -----------
            Total  assets          $ 252,129          $ 281,845
                                   =========          ==========

LIABILITIES
  Bank  loan  payable              $  82,966          $  88,736
  Accounts  payable                  129,884            115,476
                                  ----------         -----------
     Total  current  liabilities     212,850            204,212
                                  ----------         -----------
   Accounts payable, related party   499,286            430,135
   Notes  payable,  related  party   182,027            182,027
   Reserve  for loss contingencies   350,000            350,000
                                  ----------         -----------
     Total long-term liabilities   1,031,313            962,162
                                  ----------         -----------
           Total  liabilities      1,244,163          1,166,374
                                  ----------         -----------
   Commitments  and  contingencies  (Note  8)

SHAREHOLDERS'  EQUITY
Common  stock:  $0.001
 par value:  100,000,000  shares
 authorized;  25,330,268  and
 22,785,268 issued  and
outstanding,  respectively            25,330            22,784
Preferred  stock:  25,000,000 shares
 authorized; none  issued  or
 outstanding                            -  -              -  -
Additional  paid-in  capital       3,735,462         3,637,208
Accumulated  deficit              (4,752,826)       (4,544,521)
                                  ----------         -----------
     Total  shareholders'  equity   (992,034)         (884,529)
                                  ----------         -----------
     Total  liabilities  and
       shareholders'  equity      $  252,129        $  281,845
                                  ===========        ==========

The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE>

<TABLE>
<CAPTION>
                                VHS NETWORK, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
         FOR THE THREE MONTHS ENDED MARCH 31, 2002 AND 2001 (UNAUDITED)
                      AND THE YEAR ENDED DECEMBER 31, 2001

                              Three  months     Three  months           Year
                                  ended            ended               ended
                                March  31         March  31         December  31
                                  2002               2001               2001
                             ---------------  ----------------  ----------------
<S>                              <C>              <C>                <C>
Income:
  Sales                      $     19,997     $     146,884     $     163,537
  Cost  of  goods  sold             3,543          (127,909)          139,599
                             ---------------  ----------------  ----------------
     Gross  margin                16,454            18,975            23,938
                             ---------------  ----------------  ----------------

Operating  Expenses:
 Agency  fees                       3,761             1,332            10,911
 Consulting  fees                  51,211               462             -  -
 Salaries  and  wages              27,177              -  -            11,460
 General  and  administrative       9,672             6,464            13,180
 Management  fees                  60,000            75,000           288,220
 Professional  fees                 6,988            10,822           117,894
 Office  expense  -  China                            4,580            17,595
 Depreciation  and  amortization                      3,578            14,883
 Inventory  allowance              16,093              -  -            30,000
 Other                                                  102
   Total  operating expense       174,902           102,340           504,143
                             ---------------  ----------------  ----------------

   Operating  loss                158,448           (83,365)          480,205

Other  (income)  and  expenses:
 Directors'  fees                 48,000              -  -               -  -
 Interest  expense                 1,857              -  -               972
 Exchange  (gain)  loss                               1,890           (2,183)
     Total other (income)
                             ---------------  ----------------  ----------------
     and expense                  49,857              1,890           (1,211)
     Net  loss  before  taxes   (208,305)           (85,255)         (478,994)
                             ---------------  ----------------  ----------------
     Income  taxes                  -  -              -  -               -  -
                             ---------------  ----------------  ----------------
     Net  loss               $  (208,305)       $   (85,255)       $  478,994
                             ============     ===============     ============
Net  loss  per  common
  share  -  Basic            $     0.008        $     0.004        $    0.021
                             ============     ===============     ============

Weighted average number of
     common shares - Basic    25,330,268         19,560,268        22,785,268
                             ============     ===============     ============
Net  loss  per  common
 share  -  Diluted           $     0.008        $     0.044        $    0.021
                             ============     ===============     ============

Weighted  average  number
  Of common  shares  -
  Diluted                     25,330,268         19,560,268        22,785,268
                             ============     ===============     ============

The  accompanying  notes  are  an  integral  part of these financial statements.
</TABLE>
<PAGE>
                                VHS NETWORK, INC.
                 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
         FOR THE THREE MONTHS ENDED MARCH 31, 2002 AND 2001 (UNAUDITED)
                      AND THE YEAR ENDED DECEMBER 31, 2001
<TABLE>
<CAPTION>

                                                             Additional
                                                              Paid-in     Accumulated
                                            Common  Stock     Capital      Deficit
                                         Shares     Amount
                                       ----------- -------- ----------- ---------------
<S>                                        <C>         <C>      <C>         <C>
Balance December 31, 2000               19,560,268  $19,559  $3,544,408  $(4,065,527)
                                       ----------- -------- ----------- ---------------
Common stock issued for debt                25,000       25         - -         -  -
Acquisition of TrueNet Enterprise Inc.   3,200,000    3,200      92,800         -  -
Net loss for the year                          - -      - -         - -     (478,994)
                                       ----------- -------- ----------- ---------------
Balance December 31, 2001               22,785,268  $22,784  $3,637,208  $(4,544,521)
Directors' fees                          1,250,000    1,250      46,750
Common stock issued for expenses         1,295,000    1,295      51,504
Net loss for the period                        - -      - -         - -     (208,305)
                                       ----------- -------- ----------- ---------------
Balance March 31, 2002                  25,330,268  $25,330  $3,735,462  $(4,752,826)
                                       ----------- -------- ----------- ---------------


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

</TABLE>

<PAGE>
<TABLE>
<CAPTION>
                                VHS NETWORK, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
         FOR THE THREE MONTHS ENDED MARCH 31, 2002 AND 2001 (UNAUDITED)
                      AND THE YEAR ENDED DECEMBER 31, 2001

                                                          Three  months      Three months         Year
                                                             ended              ended            ended
                                                            March  31          March  31       December  31
                                                              2002               2001             2001
                                                       --------------      ----------------  ----------------
<S>                                                          <C>                    <C>               <C>
Net  income  (loss)                                    $     (208,305)     $     (85,255)     $     (478,994)
Adjustments  to  reconcile  net  income  (loss)  to
 net  cash  provided  by  (used  for)  operating  activities:
 Issuance  of  common  stock  for  directors'  fees            48,000              -  -                 -  -
 Issuance  of  common  stock  for  expenses and debt           52,800              -  -                   25
 Inventory  valuation  allowance                                 -  -              -  -               30,000
 Amortization  of  intangible  assets                          12,800              2,000               8,000
 Depreciation                                                   3,294              1,578               6,883
 Prepaids  and  deposits                                         -  -               -  -              68,535
                                                        --------------      ----------------  ----------------
                                                               (91,411)          (81,677)           (365,551)
Cash  flow  from  operating  activities:
 Changes  in  assets  and  liabilities
  Receivables                                                   16,451              (437)             15,077
  Inventory                                                     (3,296)          (31,804)             (4,171)
  Prepaid  and  deposits                                          -  -              -  -
  Bank  loan                                                    (5,770)           (2,049)
  Accounts  payable                                              8,408           (10,644)             52,511
                                                        --------------      ----------------  ----------------
     Cash  flow  used  in  operating  activities          $    (75,618)       $ (124,562)      $  (304,183)
                                                        --------------      ----------------  ----------------

Cash  flow  from  investing  activities:
 Purchase  of  TrueNet                                  $                     $     -  -       $     (96,000)
                                                         --------------      ----------------  ----------------

    Net  cash  used  in  investing  activities          $                     $     -  -       $     (96,000)
                                                        --------------      ----------------  ----------------

Cash  flow  from  financing  activities:
 Accounts  payable,  related  party                     $     75,151          $   75,000       $     280,135
 Proceeds  from  notes  payable,  related party                  - -              31,293
 Proceeds  from  exercise  of  warrants                         -  -                -  -              96,000
                                                        --------------      ----------------  ----------------
Net  cash  generated  by financing activities           $     75,151          $  106,293       $     376,135
(Decrease)  Increase in cash and cash equivalents                467             (18,269)            (24,048)
Balance  at beginning of period                                1,157              25,205             (25,205)
                                                       --------------      ----------------  ----------------
Balance  at  end  of  period                            $        690          $    6,936       $       1,157
                                                       =============      ===============     ================
Supplementary  disclosure:
 Cash  paid  for  interest                               $     1,857          $     -  -       $        972
 Cash  paid  for  taxes                                  $     -  -           $     -  -       $       -  -
 Conversion  of  payables  into  common  stock           $    52,800          $     -  -       $       -  -
 Common  stock  issued  for  acquisitions                       -  -                -  -             96,000
 Common  stock  issued  for  services  and expenses           48,000                -  -             25,000

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

</TABLE>
<PAGE>

                                VHS NETWORK, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                 MARCH 31, 2002


1.     NATURE  OF  OPERATIONS

COMPANY  HISTORY

VHS  Network,  Inc.  ("the  Company" or "VHSN") was incorporated in the State of
Florida  on December 18, 1995 as Ronden Vending Corp.  On December 24, 1996, the
Company  incorporated a wholly owned subsidiary called Ronden Acquisition, Inc.,
a  Florida  corporation.  Ronden  Acquisition,  Inc. then merged with Video Home
Shopping,  Inc., (a Tennessee corporation), and Ronden Acquisition, Inc. was the
surviving Florida Corporation.  In 1996, Video Home Shopping, Inc. was a network
marketing  and  distribution  company which offered a wide range of products and
services  to  consumers  through  the  medium of video tape.  However, after the
merger  the  Company  decided  not  to  continue  with the network marketing and
distribution  operations  of  Video  Home  Shopping,  Inc.  of  Tennessee.

On  January  9,  1997,  articles  of  merger  were  filed for the Company as the
surviving  corporation  of  a  merger  between  the Company and its wholly owned
subsidiary  Ronden Acquisition, Inc.  This step completed the forward triangular
merger  between  Video  Home  Shopping,  Inc.,  Ronden Acquisition, Inc. and the
Company.

On  January  9, 1997, articles of amendment were filed to change the name of the
Company  from  Ronden  Vending Corp. to VHS Network, Inc.  On April 9, 1997, the
Company  incorporated  VHS  Acquisition,  Inc.  as  a  wholly  owned subsidiary.

In  April  1997,  the  Company  was  restructured  by way of a reverse take-over
involving its wholly owned subsidiary, VHS Acquisition, Inc., a Florida company,
and  VHS  Network, Inc., a Manitoba and Canadian controlled private corporation.

On  April  12,  2000,  the Company acquired all the outstanding common shares of
China  eMall  Corporation,  an  Ontario private company.  This represents a 100%
voting  interest  in  China  eMall  Corporation.

On  December  1, 2001, the Company acquired all the outstanding common shares of
TrueNet  Enterprise  Inc.,  an  Ontario  private  company.

OPERATIONS

The  Company  is  continuing  to  reposition itself to identify technologies and
market  opportunities  in  the  United States, Canada and abroad in Internet and
electronic  commerce  interactive  media,  and SmartCARD loyalty marketing.  The
Company  will  operate  and/or  develop  two  lines  of  business  as  follows:

China eMall Corporation ("China eMall"):  Through its acquired subsidiary, China
eMall Corporation, an Ontario, Canada corporation, the Company provides Internet
marketing  and  information  services  to  facilitate  trade between Chinese and
Western businesses.  The Company's primary focus will be to establish an on-line
presence  to  facilitate  the  export  of  Chinese  products.  Through  its
multi-functional  portal, Chinese suppliers can post their products and services
in  a  format that is easy for searching, quoting and tracking, and that gives a
Western  buyer  access to multiple suppliers for the best quality and price, and
direct  communication.  Realizing  the  difference  in  business  culture  and
financial  systems,  China eMall will allocate a substantial amount of resources
in  assisting  in  the  communications,  export/import  processing,  financial
transaction  and  product  services.  China  eMall's  business  will make use of
Internet  technology  to  speed  up  the  export  process  and broaden the sales
channels  for  Chinese goods and services and, more importantly, bring customers
into  direct  contact  with  Chinese  producers who can constantly upgrade their
products to meet customers' needs.  China eMall has an agreement with Wangfujing
Department  Store Ltd., a large Chinese retailer, as its prime product supplier.

SmartCARD:  The  Company  is developing computer chip-based plastic access cards
that  utilize proprietary SmartCARD technology, which is licensed from Groupmark
Canada  Limited,  a related party.  This technology enables the cards to be used

<PAGE>
for  identification  purposes and as debit or charge cards.  The Company intends
to  focus its marketing efforts on companies that wish to distribute these cards
to their customers as a reward for their loyalty.  Groupmark Canada Limited owns
the  registered trademark "SmartCARD" in Canada and has a pending application in
the  United  States.  Groupmark  Canada has granted the Company a licence to use
the  trademark "SmartCARD".  Pursuant to the terms of the licence agreement, the
Company will pay to Groupmark a royalty of 5% of net sales of products using the

SmartCARD  trademark  and  technology.

2.     SUMMARY  OF  SIGNIFICANT  ACCOUNTING  POLICIES

These  consolidated  financial  statements  are  prepared  in  accordance  with
accounting principles generally accepted in the United States.  The following is
a  summary of the significant accounting policies followed in the preparation of
these  consolidated  financial  statements.

PRINCIPLES  OF  CONSOLIDATION

The  consolidated  financial  statements include the accounts of the Company and
all  of  its  subsidiary companies.  Intercompany accounts and transactions have
been  eliminated  on  consolidation.
These  consolidated  financial statements reflect all adjustments, which are, in
the  opinion of management, necessary for a fair presentation of the results for
the  interim  periods.

CASH  AND  CASH  EQUIVALENTS

Cash  and  cash  equivalents  consist  of  cash  on hand and cash deposited with
financial  institutions,  including  money market accounts, and commercial paper
purchased  with  an  original  maturity  of  three  months  or  less.

CONCENTRATION  OF  CASH

The  Company  at  times  maintains  cash balances in accounts that are not fully
federally  insured.

<PAGE>

INVENTORIES

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

PROPERTY  AND  EQUIPMENT

Property and equipment are stated at cost or, in the case of leased assets under
capital  leases,  at  the present value of future lease payments at inception of
the  lease.  Major  improvements  that  materially  extend  the  useful  life of
property  are  capitalized.  Depreciation is calculated on a straight-line basis
over the estimated useful lives of the various assets, which range from three to
seven  years.  Leasehold improvements and leased assets under capital leases are
amortized over the life of the asset or the period of the respective lease using
the  straight-line  method, whichever is the shortest.  Expenditures for repairs
and  maintenance  are  charged  to  expense  as  incurred.
Depreciation expense for the three-month period ending March 31, 2002 was $3,294
and  for  the  year  ended  December  31,  2001  was  $6,883.

BANK  LOAN

The company has a bank loan secured by the assets of a subsidiary and guaranteed
by  a  group  of shareholders who have recourse against the Company. Interest is
calculated  at  Canadian  Bank  Prime  Plus  1.5%  (currently  6.5%).

STOCK-BASED  COMPENSATION

The  Company  accounts for its stock-based compensation plan based on Accounting
Principles  Board  ("APB")  Opinion  No.  25.  In  October  1995,  the Financial
Accounting  Standards  Board  ("FASB")  issued  SFAS  No.  123,  "Accounting for
Stock-Based  Compensation".  The  Company has determined that it will not change
to  the  fair  value  method  and  will  continue  to use APB Opinion No. 25 for
measurement  and  recognition  of  any  expense  related to employee stock-based
transactions.

INCOME  TAXES

The  Company  accounts  for  income  taxes  in  accordance  with  SFAS  No. 109,
"Accounting for Income Taxes".  Income taxes are provided for the tax effects of
transactions  reported  in  the consolidated financial statements and consist of
deferred  taxes  related  to  differences  between  the  basis  of  assets  and
liabilities for financial and income tax reporting.  The deferred tax assets and
liabilities  represent  the future tax return consequences of those differences,
which  will  be either taxable or deductible when the assets and liabilities are
recovered  or  settled.  Deferred taxes are also recognized for operating losses
that  are  available  to  offset  future  taxable  income.

FOREIGN  CURRENCY  TRANSLATION

Transactions  are  translated into the functional currency at the exchange rates
in effect at the time the transactions occur.  Exchange gains and losses arising
on  translation  are  included  in  the  operating  results  for  the  year.

REVENUE

Sales  are  recorded  for  products  upon  shipment  of product to customers and
transfer  of  title  under  standard  commercial  terms.

COMPREHENSIVE  INCOME

In  1999,  the  Company  adopted SFAS No. 130, "Reporting Comprehensive Income".
SFAS  No.  130  establishes  standards  for  reporting  and  presentation  of
comprehensive  income  and its components in a full set of financial statements.
Comprehensive  income  is  presented  in  the  consolidated  statements  of
shareholders'  equity  and  comprehensive income, and consists of net income and

<PAGE>
unrealized  gains  (losses) on available for sale marketable securities; foreign
currency  translation  adjustments  and  changes  in  market  value  of  futures
contracts that qualify as a hedge; and negative equity adjustments recognized in
accordance  with  SFAS No. 87. SFAS No. 130 requires only additional disclosures
in  the  consolidated  financial  statements  and  does not affect the Company's
financial  position  or  results  of  operations.  The elements of comprehensive
income  for  the  three month period end March 31, 2001 and 2000, the year ended
December  31,  2000  are  de  minimis.

INCOME  (LOSS)  PER  COMMON  SHARE

Income  (loss)  per  common  share is computed on the weighted average number of
common  or  common  and  common  equivalent shares outstanding during each year.
Basic  Earnings-per-Share ("EPS") is computed as net income (loss) applicable to
common  stockholders  divided  by  the  weighted average number of common shares
outstanding  for  the  period.  Diluted EPS reflects the potential dilution that
could  occur  from  common  shares issuable through stock options, warrants, and
other convertible securities when the effect would be dilutive.  The Company had
no  dilutive  securities.

LONG-LIVED  ASSETS

In accordance with Statement of Financial Accounting Standards ("SFAS") No. 121,
the Company reviews the carrying value of its long-lived assets and identifiable
intangibles  for possible impairment whenever events or changes in circumstances
indicate  the  carrying  amount  of  assets  to  be  held  and  used  may not be
recoverable.

USE  OF  ESTIMATES

The  preparation  of  the  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 revenue and expenses during the reporting
periods.  Actual  results  could  significantly  differ  from  those  estimates.

ADVERTISING  COSTS

The  Company  expenses  advertising costs as they are incurred.  The Company did
not  incur  any advertising costs during the three month period ending March 31,
2002  or  year  ended  December  31,  2001.

SEGMENTS  OF  AN  ENTERPRISE  AND  RELATED  INFORMATION

The  Company  follows SFAS No. 131, "Disclosures about Segments of an Enterprise
and  Related  Information".  SFAS  No.  131  requires  that  a  public  business
enterprise  report  financial  and  descriptive information about its reportable
operating  segments  on the basis that is used internally for evaluating segment
performance  and deciding how to allocate resources to segments.  Currently, the
Company  operates  in  only  one  segment.

INTANGIBLES

Intangible  assets  are  recorded  at  cost.  Capitalized  web-site and software
development  costs  associated  with  the  purchase  of  China eMall and TrueNet
Enterprise  Inc.  are  amortized on a straight-line basis over a period of three
years.

RECENTLY  ISSUED  ACCOUNTING  PRONOUNCEMENTS

In  June  1998,  the  FASB  issued  SFAS  No.  133,  "Accounting  for Derivative
Instruments  and  Hedging Activities".  SFAS No. 133 requires recognition of all
derivative financial instruments as either assets or liabilities in consolidated
balance  sheets  at  fair  value  and  determines  the  method(s)  of  gain/loss
recognition.  The  FASB  issued SFAS No. 137, "Deferral of the Effective Date of
FASB Statement No. 133" in June 1999 to defer the effective date of SFAS No. 133
to  fiscal  years  beginning  after  June  15,  2000.  The Company does not have
derivative  instruments  and  does  not  conduct  hedging  activities.

3.     INVENTORIES

On April 29, 1998, the Company acquired approximately 32,000 sets of printed art

<PAGE>
reproductions.  Each  set  consists of four full-colour prints from "The Andover
Series"  by  artist  Jim Perleberg.  Each image has a title narrative printed in
the margin and is re-signed, in the plate, by the artist.  The management of the
Company  has  evaluated  the  market value of the prints and determined that the
market  value of the prints is not below their acquisition cost.  The prints are
by  a  noted  artist,  and  the  original  Andover  Series  S/N  Limited Edition
lithographs  were  fully  sold.

The  Company  acquired  these sets of prints in exchange for 1,399,992 shares of
its  common stock valued at $139,999.  The Company will be offering these prints
for  sale  through  its  own  web  site  and  other  Internet  web  sites.

The Company has recorded a valuation allowance of $30,000 in 2001 and $28,000 in
2000  to  reflect  the  fair  value  of  the  inventory.

The  Company  has  other  inventory of computer related items held in the normal
course  of  business  in  the  amount  of  $17,601.

4.     INCOME  TAXES

No  provision  for federal and state taxes has been recorded for the three month
period  ended  March  31,  2002  and 2001, and the year ended December 31, 2001,
since  the  Company  incurred  net  operating  losses  for  these  periods.

5.     RELATED  PARTY  TRANSACTIONS

GROUPMARK  CANADA  LIMITED

In  1997, the Company entered into a management service agreement with Groupmark
Canada  Limited ("Groupmark"), of which the Chairman and Chief Executive Officer
of  the  Company  is  the  sole  shareholder.  Under  this  agreement, Groupmark
provides  the  Company all management, daily administrative functions, financial
and  business advisory services.  Groupmark was also contracted to assist in the
technological  development of the "SmartCARD".  Contractually, charges for these
services are not to exceed $56,000 per month.  For the three months ending March
31,  2002 and 2001, the Company incurred management fees of $60,000 and $75,000,
respectively.

Amounts  due  Groupmark  pursuant to this management service agreement and other
borrowings as of March 31, 2002 and December 31, 2001 are $499,286 and $430,135,
respectively.  Groupmark  has  the  option  to  accept  payment  by  way  of the
Company's  common  stock  at  fair  market  value  in  lieu  of  cash.

6.     COMMITMENTS  AND  CONTINGENCIES

LEGAL

The  Company  is not currently aware of any legal proceedings or claims that the
Company believes will have, individually or in the aggregate, a material adverse
effect  on  the  Company's  financial  position  or  results  of  operations.

VIDEO  HOME  SHOPPING,  INC.,  A  TENNESSEE  CORPORATION
In  December  1996,  the  Company  was  merged with Video Home Shopping, Inc., a
Tennessee  corporation.  Subsequent  to  the  merger,  the new managemetn of the
company  decided  not  to  continue  with  the business operations of Video Home
Shopping,  Inc.
<PAGE>
The  Company  has  recorded  a  $350,000 liability for loss contingencies.  This
reserve  was  established because of a potential liability of the Company to the
Internal  Revenue  Service  (IRS).  Management  discovered  from  reviewing 1996
financial  statements of Video Home Shopping Inc., a predecessor to the Company,
of  the  nature  of this liability.  The footnotes to those financial statements
stated  the  following:

"The  Company  has  outstanding  payroll taxes totalling $206,385 as of July 31,
1996.  The outstanding balance consists of Federal Withholdings, Social Security
and  Medicare  taxes  ad  Unemployment taxes for the quarters ended December 31,
1995,  March  31,  1996  and  June  30, 1996.  The Company also did not make the
necessary  payroll  tax deposits for the month ending July 31, 1996.  Management
believes  the Company will be able to file and remit the outstanding payroll tax
returns  during  the  current  period.  As the Internal Revenue Service assesses
substantial  civil  penalties  and  interest  for  the failure to file and remit
payroll  related  taxes,  the  total  amount  due could increase significantly "

Management  believes  that  these Federal Withholding taxes, Social Security and
Medicare  taxes,  employer's  taxes,  and  other payroll taxes may not have been
remitted  to  date;  however,  the  Company has not been able to confirm whether
payment  was  made.

Furthermore, in March 2000, the Company learned of an IRS investigation relating
to  the  affairs  of a former principal of Video Home Shopping Inc.  The Company
learned  of  this  investigation  from  its  transfer  agent,  and  has not been
contacted by the IRS.  Management of the Company has, however, contacted the IRS
for  information  and  has  no  indication  that  the investigation concerns the
Company  directly.  Management,  nevertheless,  believes  that  said  IRS
investigation  may  relate,  in part, to these unpaid Federal Withholding taxes,
Social  Security  and Medicare taxes, employer's taxes, and other payroll taxes.

While  management  views that any liability in this regard is the responsibility
of  the  former principal of Video Home Shopping Inc. and is not necessarily the
liability  of the Company, out of prudence, the Company has elected to provide a
reserve of $350,000 to provide for the possibility of such liability to the IRS.
Management  is  currently in process of determining the course of further action
regarding  this  liability.  As  of  May  10,  2002,  the  IRS  has not notified
management  by  regarding  the  status  of  the  investigation.

GOING  CONCERN  UNCERTAINTIES

The  accompanying  financial  statements  have  been prepared in conformity with
generally  accepted accounting principles, which contemplate continuation of the
Company  as  a  going  concern.  However,  the Company has experienced recurring
operating  losses  and  negative  cash  flows  from  operations.  The  Company's
continued existence is dependent upon its ability to increase operating revenues
and/or  raise  additional  equity  financing.

In view of these matters, management believes that actions presently being taken
to  expand  the  Company's  operations  and to continue its web-site development
activity  provide  the  opportunity  for the Company to return to profitability.
The  continued  focus  on  strategic  technological investments will improve the
Company's  cash  flow, profitability, and ability to raise additional capital so
that  it  can  meet  its  strategic  objectives.

Management  is  currently  in  the  process  of  negotiating  additional  equity
financing with potential investors.  The financial statements do not include any
adjustments  that  might  result  from  the  outcome  of  this  uncertainty.
<PAGE>
7.     INTANGIBLE  ASSETS

Intangible  assets  at  March  31,  2002  consist  of  the  following:

                                           March  31        December  31
                                              2002              2001
                                        -------------    ---------------
     Software                           $     129,520     $     129,520
     Domain  name                              24,000            24,000
     Less:  accumulated  amortization         (26,470)          (13,760)
                                        $     127,050     $     139,850
                                        ==============   ================

Amortization  expense  for  the  three  months ended March 31, 2002 and 2001 was
$12,800  and  $2,000  respectively, and for the year ended December 31, 2001 was
$8,000.

8.     REGISTRATION  STATEMENT

The  Securities  and  Exchange  Commission issued a no further comment letter on
February  14,  2001,  and  the  Company's Registration Statement, Form SB-2, was
deemed  effective  as  of  that  date.  This  Registration Statement, Form SB-2,
pertains to the sale of 6,830,812 shares of its common stock, of which 3,755,828
shares  are  issued  and  outstanding,  and  3,074,984  shares are issuable upon
exercise  of  options  and  other conversion privileges to acquire common stock.
The  shares  were  issued,  or  are  issuable  upon  conversion  or  exercise of
securities, which were issued, by the Company in private placement transactions.

The Company will not receive any proceeds upon the sale of shares by the Selling
Securityholders.  However, this registration statement relates to the sale of up
to  299,230 shares of the Company's common stock that may be issued in the event
of  the exercise of outstanding options held by Selling Securityholders.  If all
such  options  are  exercised,  the  Company would receive proceeds of $104,730.

9.     MAJOR  CUSTOMERS

Virtually  all  of  the revenues for the three months ending March 31, 2002 were
from  two  customers.

<PAGE>

ITEM  2.  MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OR  PLAN  OF  OPERATION.


                DISCLOSURE  REGARDING  FORWARD-LOOKING  STATEMENTS

     This  report  includes  "forward-looking  statements" within the meaning of
Section  27A  of  the  Securities  Act of 1933 and Section 21E of the Securities
Exchange  Act of 1934. For example, statements included in this report regarding
our  financial  position,  business  strategy and other plans and objectives for
future  operations, and assumptions and predictions about future product demand,
supply,  manufacturing,  costs,  marketing  and  pricing  factors  are  all
forward-looking  statements.  When  we  use  words  like "intend," "anticipate,"
"believe,"  "estimate,"  "plan"  or  "expect,"  we  are  making  forward-looking
statements.  We  believe that the assumptions and expectations reflected in such
forward-looking  statements are reasonable, based on information available to us
on  the  date  hereof,  but  we  cannot  assure  you  that these assumptions and
expectations  will  prove  to  have been correct or that we will take any action
that  we  may presently be planning. We have disclosed certain important factors
that  could  cause  our  actual  results  to  differ materially from our current
expectations  elsewhere  in  this  report.  You  should  understand  that
forward-looking  statements  made  in  this  report are necessarily qualified by
these  factors.  We  are  not  undertaking  to  publicly  update  or  revise any
forward-looking statement if we obtain new information or upon the occurrence of
future  events  or  otherwise.

Going  Concern

VHSN  is  in  the  development stage and has not yet generated a profit from its
operations.  Its  continued  existence  and  its  ability to continue as a going
concern  are dependent upon its ability to obtain additional capital to fund its
operations.

Goals  and  Objectives

VHSN's  goals  and objectives are centered around its ability to identify market
opportunities in technology and products related to its e-commerce objectives in
United  States, Canada and abroad. To achieve these objectives VHSN must compete
with  many other more well established organizations in the Internet and related
fields.  It is the intention of VHSN to continue to acquire technology and joint
venture/  strategic  alliances  where  possible,  to  help it achieve its goals.

Cash  Requirements

The Company intends to raise additional funds over the next year from sales of
its  securities  to  satisfy  its  cash  requirements.

<PAGE>
Liquidity  and  Capital Resources

VHSN  had sales of $19,997 for the period ended March 31, 2002. The Company will
continue  to  rely  on  investor  funding  until  revenue  and profitability are
achieved.  The  result  of  this  current  years  activities,  which  have  been
significant,  in  terms  of  the  development  of  potential customers, have not
reflected  in  sales  achievement  during the current fiscal year. VHSN acquired
TrueNET  Enterprise  Inc.  in  December  2001.  This  resulted  in  a  period of
adjustment  while  the  move  to new premises took place. It is anticipated that
this  acquisition  will  begin  to  show  results  during  the 2002 fiscal year.

Results  of  Operations

Results  for the period ended March 31, 2002 compared to the same period ended
March 31, 2001

Sales for the period ended March 31, 2002 were 19,997 as compared to the  same
period sales in 2001 of 146,884.

Total  Operating  Expense increased from $102,340 for the period ended March 31,
2001  to  $174,902 for the period ended March 31, 2002. This increase of $72,562
was  due  primarily  to  an  increase  in  consulting  fees, salaries and wages.

The  Company  is  not  aware  of any material trend, event or capital commitment
which  would  potentially  adversely  affect  liquidity. In the event a material
trend  develops,  the  Company  believes  that  it  will  have  sufficient funds
available to satisfy working capital needs through lines of credit and the funds
expected  from  equity  sales.

OTHER:

Except  for  historical  information  contained  in this Report, the matters set
forth  above  are  forward-looking  statements  that  involve  certain risks and
uncertainties  that  could  cause  actual  results  to  differ from those in the
forward-looking  statements.  Investors  are  directed  to consider, among other
items,  the  risks and uncertainties discussed in documents filed by the Company
with  the  Securities  and  Exchange  Commission.

<PAGE>

                           PART II - OTHER INFORMATION

Item  1.  Legal  Proceedings.

None

Item  2.  Changes  in  Securities/Recent  Sales  of  Unregistered  Securities.

  Some  of  the  holders  of  the  shares  issued below may have subsequently
transferred  or  disposed  of their shares and the list does not purport to be a
current  listing  of  the  Company's  stockholders.

     During  the  period  ended  March  31,  2002,  we  have issued unregistered
securities  to the persons, as described below. We believe that each transaction
was  exempt  from the registration requirements of the Securities Act of 1933 by
virtue  of  Section  4(2)  thereof,  Regulation  D  promulgated thereunder. All
recipients had adequate access, through their relationships  with  us,  to
information  about  us.

On or about March 4, 2002 the Company issued the following shares to the
following Individuals:

- 1,320,000 shares to Forte management for consulting services rendered to
the Company valued at $.03 per share.

- 500,000 shares to Elwin Cathcart valued at $.05 per share
- 250,000 shares to Gang Chai valued at $.05 per share
- 250,000 shares to Thomas Roberts valued at $.05 per share
- 250,000 shares to David Smelsky valued at $.05 per share
- 1,000,000 shares each to Jeff McMillan, John Salowski and Reginal Hose in
            connection with the acquisition of TruNet.

Item  3.  Defaults  Upon  Senior  Securities.

None

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

None

Item  5.  Other  Information.

None

Item  6.  Exhibits  and  Reports.

a. Exhibits

2.1*     Agreement  and Plan of  Reorganization  between VHS  Network,  Inc. and
         Exodus  Acquisition  Corporation,  dated  May  6,  2000.
3.1*     Articles  of  Incorporation  for  VHS  Network,  Inc.
3.2*     Articles of Merger for VHS Network,  Inc.
3.3*     Articles  of  Amendment  for  VHS  Network,  Inc.
3.4*     By-laws  of  VHS  Network,  Inc.
4.1*     Specimen  Stock  Certificate.
10.1*    Share Exchange  Agreement made April 15, 2000 among VHS Network,  Inc.,
         China eMall  Corporation,  Gang Chai, Qin Lu Chai, Uphill Capital Inc.,
         Charles  He,  Qing  Wang  and  Forte  Management  Corp.
10.2*    Licence  Agreement  between  Groupmark  Canada Limited and VHS Network,
         Inc.  dated  January  1,  2000.
10.3*    Management Services Agreement between VHSN and Groupmark Canada Limited
         dated  April  1997.
10.4*    Agreement  and Plan of Merger  dated as of December 26, 1996 made among
         Ronden Vending Corp.,  Ronden  Acquisition,  Inc., Video Home Shopping,
         Inc. (a  Tennessee  corporation),  Progressive  Media  Group,  Inc. and
         Pamela  Wilkerson.
10.5*    Agreement  and Plan of Merger  dated as of December  30,  1996  between
         Ronden  Vending  Corp.  and  Ronden  Acquisition,  Inc.
10.6*    Agreement  and Plan of  Reorganization  dated  April 10, 1997 among VHS
         Network, Inc. and VHS Acquisition, Inc. and VHS Network (Canada), Inc.*
10.8**   Form of Acquisition  Agreement between the Company and TrueNET
         Enterprise, Inc.

----------------
*  Previously  filed as an exhibit to the Company's Registration  Statement
   on  Form  SB2  filed  with  the  Commission and incorporated by reference
   herein

** Filed as exhibit 10.8 to the Company's Form 10K-SB filed with the Commission
   on April 16, 2002 and incorporated by reference herein

b. Reports on Form 8-K

      On February 4, 2002, the Company filed a Current Report on Form 8-K with
the Commission disclosing the Company's change of accountants.


<PAGE>

                                   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.

                               VHS  NETWORK  INC.


                               /s/Elwin  Cathcart
                               Elwin  Cathcart,  Chief  Executive  Officer
                               (Principle Accounting Officer  and Principal
                                Executive Officer)


Date: May 15,  2002