SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-KSB

            (X) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
                 SECURITIES EXCHANGE ACT OF 1934 (FEE REQUIRED)

                      For the year ended December 31, 2002

          ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
                SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)

                          Commission file #: 333-75272

                          COMMERCIAL EVALUATIONS, INC.
              ----------------------------------------------------
             (Exact name of registrant as specified in its charter)

            Nevada                                       88-04777246
 ------------------------------              ----------------------------------
(State or other jurisdiction of             (IRS Employer Identification Number)
 incorporation or organization)

                2320 Paseo Del Prado,
          Bldg. "B", No. 205 Las Vegas, NV                           89121
       --------------------------------------                       -------
      (Address of principal executive offices)                     (Zip Code)

                  Registrant's telephone number: (702) 866-6029

           Securities registered pursuant to Section 12(b) of the Act:

        Common Stock $0.001 Par Value                        NONE
               --------------                       ---------------------
              (Title of Class)                     (Name of Each Exchange
                                                    on Which Registered)

           Securities registered pursuant to Section 12(g) of the Act:

        Common Stock $0.001 Par Value                       NONE
              --------------                        ---------------------
             (Title of Class)                      (Name of Each Exchange
                                                    on Which Registered)

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 preceding 12 months (or for such shorter period that the registrant was
required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days. (1) Yes  X  No          (2) Yes  X  No
                                          -----  -----            -----  -----

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.

At December 31, 2002 there were 500,000 shares of common stock outstanding. The
aggregate market value of the common stock held by non-affiliates of the
registrant (i.e., excluding shares held by executive officers, directors and
control persons as defined in rule 405).

Documents incorporated by reference: None.

<PAGE>



                                     PART I

Item 1. Business

Our primary business is to arrange mortgage loans for consumers for the purchase
of residential real estate.

The predecessor company to Commercial Evaluations, Inc. (CEI) was organized as a
Nevada corporation as ZXS, Inc. on June 7, 1994. The name was changed on
February 29, 2000. We operate as a "net branch office" of a mortgage bank
operating under a Nevada exemption, Nevada Revised Statutes (NRS) 645E.15(6)(a).
A net branch office does not possess its own mortgage license. Under an
exclusive net branch agreement with SkoFed Mortgage Funding Corporation, we pay
a fee on each loan closed. SkoFed is licensed with the State of Nevada as a
primary mortgage company. As a net branch office, we operate under the
supervision of SkoFed and is shielded from liabilities associated with being a
primary mortgage company, such as the liabilities associated with the approval
or disapproval of loans, state and federal audits and the potential for having
to repurchase loans (all of which are the responsibility of SkoFed). We may
broker any mortgage loans to any lending source in which a brokerage fee would
be collected. We cannot enter into any other contracts with wholesale lenders,
cannot fund loans from any other source than SkoFed and cannot solicit funds
from private investors directly. These activities are reserved for licensed
mortgage companies. We are responsible for payment of all costs attributed to
the operation and receives a net check at the close of each transaction.

We receive requests for services from realtors in the Las Vegas area. We write
up applications for potential home buyers (loan origination). We work with
SkoFed and offer them the first right of refusal for funding the loan either as
a loan originator or as finder of a loan originator. If SkoFed declines for any
reason, we approach wholesale lenders from a list of approximately 50 approved
by SkoFed. In either event, SkoFed does not participate in any commissions. If
they are the primary lender, they will receive the fees according to the
schedule described in this document under Average Loan Fees. If they refuse the
loan, and the loan is funded through one of SkoFed's approved wholesale mortgage
lenders, they will receive a flat processing fee of $395-$650, depending on the
loan.

To date, SkoFed has been a loan originator on approximately 30% of all of our
loans with the other 70% brokered through its list of approximately 50 wholesale
mortgage lenders. Once a loan originator is engaged, we commence on the loan
closing procedures which involve drawing up documents, arranging for an escrow
company and working with the escrow company to fund and record the loan for the
buyer. However, there are no forward commitment guarantees for any residential
mortgage banking services or any other of our services. Should SkoFed or any of

<PAGE>


its wholesalers decline to fund a loan, we would lose the business. Should
SkoFed suffer a material adverse event, we would have to continue with one of
its 50 wholesalers or find a substitute loan originator.

We derive 100% of our income from the relationship with SkoFed. At present we
have no standby affiliations. However, we believe that a replacement loan
originator could be negotiated with in less than 10 business days with minimal
disruption of our services.

To date, our mortgage loan applicants have been obtained by (1) the actions of
our loan officers and originators, (2) personal contacts through our officers
and (3) referrals from previous borrowers. We will also market its loan services
by means of direct mail and newspaper advertising.

We plan to continue to provide residential loan services to Southern Nevada.
According to "Las Vegas Perspective 2001" published by Metropolitan Research
Association (MRA), in 2000 there were 523,314 households in our service area.
Existing home resales totaled 29,515 with an average sales price of $155,455.
There were 20,520 new homes constructed in 2000. New home construction and
existing home resales are estimated by management to have increased 15% on an
annualized basis in 2002,


Employees

The Company is run by three directors and officers. The are assisted by a full-
time secretary and a full time loan coordinator. At year end, there were 17 loan
brokers.

Competition

We are in direct competition with numerous local business entities that provide
mortgage banking and brokering services. According to the Nevada Department of
Business and Industry/Financial Institution Division, 239 lending institutions
are able to compete with our residential loan services. This figure includes all
banks, credit unions and mortgage bankers in all of Nevada. The vast majority of
mortgage loans are processed by institutions in the immediate area of the home
sale. However, it is management's opinion that there are less than 30 consistent
competitors for mortgage lending in Southern Nevada.

We face intense competition from the mortgage banking operations of savings &
loan and thrift institutions that possess substantially greater financial
resources than our company. The competition also has an established share of
mortgage banking market, which we believe is increasing. Further, both savings &
loan and thrifts have ready access to substantial savings pools available for
lending large, multi-store branch systems. Both possess the ability to research
and develop new loan products to market through their branch systems.

However, we believe that an unusual mixture of competition and cooperation
characterizes the financial services industry. Because of the many types of loan
products available in today's marketplace, no individual lending institution
specializes in one or, at most, a few loan products.

We work directly with SkoFed approved mortgage bankers, mortgage brokers, and
other mortgage originators, making our residential loan services available to
their respective sales forces. By taking this overall approach, we believe that
we have the ability to lend a broader geographical market area without incurring
the expense of numerous branch office facilities, the clerical help in these
locations or the direct sales personnel needed to reach a wide segment of the
population.

<PAGE>


Item 3. Legal Proceedings

None.


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

None.



PART II

Item 5. Market for Registrant's Common Equity & Related Stockholder Matters

(a)  Market Information

     (1)  (i)  None
          (ii) Not applicable
          (iii)Not applicable
          (iv) Not applicable
          (v)  Not applicable
     (2)  (a)  Not applicable

(b)  Holders

     (1)  Title of Class                Number of Record Holders
          Common Stock,                 Approximately 3
          $0.001 Par Value
     (2)  Not applicable

(c)  Dividends

     (1)  There have never been any dividends declared by the Registrant.

     (2)  Registrant's losses do not currently indicate the ability to pay cash
          dividends.

Item 6. Selected Financial Data

                                               Twelve Months Ended December 31,
                                                   2002                 2001
                                                   ----                 ----
Selected Income Statement Data:

Revenues                                         $796,576             $336,373

Net income (loss)                               ($ 12,210)           ($ 10,521)

Net income (loss) per share                     ($   0.02)           ($   0.02)

Weighted shares outstanding                       500,000              500,000

<PAGE>


Selected Balance Sheet Data:

Total assets                                     $ 72,526             $ 74,136

Long-term liabilities*                           $ 41,959             $ 41,207

Total liabilities and stockholders'
  equity                                         $ 72,526             $ 74,136

*On January 23, 2003, the Company sold the condominium with which this debt is
associated for $50,000 and the buyer assumed the note payable.



Item 7. Management's Discussion and Analysis of Financial Condition and Results
        of Operations

Forward-Looking Statements

     This Annual Report contains forward-looking statements about our business,
financial condition and prospects that reflect our assumptions and beliefs based
on information currently available. We can give no assurance that the
expectations indicated by such forward-looking statements will be realized. If
any of our assumptions should prove incorrect, or if any of the risks and
uncertainties underlying such expectations should materialize, our actual
results may differ materially from those indicated by the forward-looking
statements.

     The key factors that are not within our control and that may have a direct
bearing on operating results include, but are not limited to, acceptance of our
services, our ability to expand our customer base, our ability to raise capital
in the future, the retention of key employees and changes in the regulation of
our industry. There may be other risks and circumstances that we are unable to
predict. When used in this Quarterly Report, words such as, "believes,"
"expects," "intends," "plans," "anticipates," "estimates" and similar
expressions are intended to identify forward-looking statements, although there
may be certain forward-looking statements not accompanied by such expressions.

General

     The predecessor company to Commercial Evaluations, Inc., (CEI) was
organized as a Nevada corporation as ZXS, Inc. on June 7, 1994. The name was
changed on February 29, 2000. We operate as a net branch of a mortgage bank
operating under a Nevada exemption, NRS 645E.15(6)(a). Under the net branch
agreement with SkoFed Mortgage Funding Corporation, we pay rent or a fee on each
loan closed. We are responsible for payment of all costs attributed to the
operation and receive a net check at the close of each transaction. Our primary
function will be to arrange mortgage loans for consumers for the purchase of
residential real estate in the short-term (currently and for the next 12
months). In the long-term, however, wholesale mortgage-banking services,
construction lending brokering services and commercial loan brokering services
will also be offered.

<PAGE>


Financials

We generated $796,576 in revenues for the twelve-month period ended December 31,
2002. This continues a trend of generally increasing quarterly mortgage loan
closings since June 1, 2000.

Total operating expenses for the twelve months ended December 31, 2002 were
$802,699 compared with $346,197 in 2001. Total operating expenses for the period
ended December 31, 2002 was $808,786, compared with $346,8942002 were entirely
related to general and administrative expenses and depreciation and amortization
expense. Operating expenses were almost entirely attributed to general and
administrative expenses for the twelve-month period ended December 31, 2002 and
the similar 2001 period. These expenses were primarily incurred from the cost of
operating our office and salaries for a employees greatly increased number of
loan brokers added under contract during the year. Depreciation expense for the
twelve-month period ended December 31, 2002 was $4,245. This represents
depreciation on the assets of the Company.

Cash on hand as of December 31, 2002 was $4,056 compared with $12,413 the prior
year. The decrease in cash was primarily due to the purchase of furniture and
equipment for additional loan brokers and for additional office space. Accounts
payable increased to $19,022 at December 31, 2003 compared with $3,236 the prior
year due to increased mortgage loan activity late in the year. The decrease in
cash of $8,357 during 2002 reflects the short delay between increased rent and
other expenses for the hiring of additional loan brokers and the actual payment
of fees and commission due to Commercial Evaluations.



Item 8. Financial Statements

Financial statements are filed with this report as pages F-1 through F-6.



Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.

There were no changes or disagreements with accountants on accounting and
financial disclosures.


PART III

Item 10. Directors and Executive Officers

The following sets forth the name, age and position held of each director and
officer of Commercial Evaluations, Inc.:

Pursuant to the Bylaws, each director shall serve until the annual meeting of
the shareholders, or until his or her successor is elected and qualified. The
Company's basic philosophy mandates the inclusion of directors who will be
representative of management, employees and the minority shareholders of the
Company. Directors may only be removed for "cause". The term of office of each
officer of the Company is at the pleasure of the Company's board.

Directors are elected for one-year terms in June of each year.

<PAGE>


CHAIRMAN OF THE BOARD, DIRECTOR, CHIEF EXECUTIVE OFFICER AND PRESIDENT - ROBERT
BARCELON, 49: Responsible for market planning, advertising, public relations,
sales promotion, merchandising and training. Has been a lifetime resident of Las
Vegas. He has been a full-time loan officer and high producer on a consistent
basis. Prior to establishing Commercial Evaluations, Inc., Mr. Barcelon was a
loan officer with Family Home Mortgage in Las Vegas from 1995 to 2000.
Previously, he was a loan officer with ABC Mortgage of Las Vegas from 1992 to
1995. He was a member of Las Vegas Local 135 Asbestos Workers from 1974 to
present. He setup their apprenticeship program, set on joint apprenticeship
committee, the executive board, and was involved heavily with contract
negotiations between contractors and union.

VICE PRESIDENT OF FINANCE - ROBERT BARCELON, 49: Mr. Barcelon is also
responsible for managing the working capital including receivables, cash and
marketable securities. He performs financial forecasting including capital
budget, cash budget, pro forma financial statements, external financing
requirements and financial condition requirements. He directs financial affairs
of the organization. He prepares all necessary reports and analysis needed to
produce financial statements and budgets. It is expected that this post will be
filled by a new hire after the close of this Offering. From 1992 to 1999, Mr.
Barcelon was an independent mortgage loan broker. He was President of Las Vegas
Local 135 Asbestos Workers from 1983 to 1993.

CHIEF OPERATING OFFICER, SECRETARY - HEATHER CAIN, 30: Ms. Cain was a senior
loan processor from 1989 to 1999 with ten years of experience with local
mortgage companies and her own firm, Southern Nevada Processing Center. She is
experienced in FHA, VA, conventional and sub-prime loans. She has lived in Las
Vegas since 1987. She is the wife of Robert Barcelon, married in 1996, but has
maintained her maiden name for professional reasons.

CHIEF FINANCIAL OFFICER, PRINCIPAL ACCOUNTING OFFICER, DIRECTOR, AND TREASURER -
LINDA VELEZ, 42: Ms. Velez is a mortgage loan broker. She has five years in the
loan business with Western Mortgage of Las Vegas from 1995 to 2000. Prior to
that she was a special education teacher at the University of California,
Riverside from 1985 to 1995. She has an undergraduate degree in liberal
arts/finance, June 1985, and a master's degree in business management, June
1987, both from UCLA.

OUTSIDE DIRECTOR - ANNE DEAN, 56: Ms. Dean has been a business consultant to new
businesses from 1990 to the present. for the past 10 years. She specializes in
the documentation of the formation of new incorporations in the State of Nevada
and acts as the designated resident agent for corporations as required by Nevada
law. Corporations may contract for all of some of the resident agent services:
accepting legal notices, office services, banking services, tax filings,
corporation filings and similar corporate maintenance activities. For the
previous 27 years she was a mining analyst for Anaconda Mining and a project
analyst for a similar Company, Peter Keiwitt. These duties included the analysis
of filed testing data, economic modeling, risk/reward analysis for drilling
programs, contract negotiations with contractors and mineral purchasing
companies as well as monitoring of regulatory activities. Ms. Dean received an
undergraduate degree in business in 1967 and earned a Ph.D. in business in 1974
from the University of Nebraska, Lincoln.

<PAGE>


Item 11. Executive Compensation

All compensation received by Officers of our company is determined from time to
time by the Board of Directors. At present there is no compensation for
directors. Officers are paid on a commission basis. Robert Barcelon receives 80%
of the total fees from SkoFed for his sales. Other members of management receive
from 50% (for in-house generated sales leads) up to 80% (for sales based on
leads generated by the sales person and on mortgages totaling more than $500,000
in any one month) of the total fees from SkoFed.

Robert Barcelon earned $36,550 in salary in 2002 compared with loan brokerage
commissions of $38,125 in 2001. As of April 1, 2002, Mr. Barcelon's compensation
switched from straight commission to a salary of $4,300 per month and 80%
commission on loans he books. Heather Cain earned $12,500 in commissions in 2002
and $64,764 in commissions in 2001. Linda Velez earned no commissions in 2002
and $5,045 in commissions in 2001.

Heather Cain is compensated for loan processing services for us. Heather Cain is
also an employee of SkoFed Mortgage as a Loan Processor. She receives an income
from SkoFed, independent of that from Commercial Evaluations.

                 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Capital Contributions

The principal shareholders have contributed $50,000 in capital contributions for
their 500,000 shares of stock.

Loans Guaranteed By Principal Stockholder

There are no current or anticipated corporate loans guaranteed by the principal
Shareholders.



Item 12. Security Ownership of Certain Beneficial Owners and Management

The following table sets forth, as of December 31, 2002, the outstanding shares
of common stock of Commercial Evaluations, Inc., owned of record or beneficially
by each person who owned of record, or was known by us to own beneficially, more
than 5% of the our Common Stock, and the name and shareholdings of each officer
and director and all officers and directors as a group:

<PAGE>


                             Table I - Common Stock
                             ----------------------

Name and Address                     Number of Shares of            Percentage
of Beneficial Owner                  Common Stock Owned(1)(2)      of Ownership
--------------------                 --------------------------    ------------
Class     Owner

COMMON    DESERT PROFESSIONAL
          SERVICES, INC. (1)                  450,000                  90%
          4160 S. Pecos Rd, #20
          Las Vegas, NV 89121

COMMON    LINDA VELEZ                          50,000                  10%
          300 E. Coast Hwy, #93
          Newport Beach, CA 92660

TOTAL OWNED BY THE DIRECTORS AND
OFFICERS AS A GROUP                           500,000                 100%


(1) Desert Professional Services is owned by Anne Dean, Director of Commercial
Evaluations, and Robert Barcelon, President and Director of Commercial
Evaluations.

(2) Pursuant to Rule 13d-3 under the Securities Exchange Act of 1934, as
amended, beneficial ownership of a security consists of sole or shared voting
power (including the power to vote or direct the voting) and/or sole or shared
investment power (including the power to dispose or direct the disposition) with
respect to a security whether through a contract, arrangement, understanding,
relationship or otherwise. Unless otherwise indicated, each person indicated
above has sole power to vote, or dispose or direct the disposition of all shares
beneficially owned, subject to applicable community property laws.


PART IV

Item 14. Exhibits, Financial Statements and Reports on Form 8-K

(a)  Financial statements are filed with this report as pages F-1 through F-6.

(b)  Reports on form 8-K

     None

(c)  Exhibits

     99.1  Certification Pursuant to 18 U.S.C. Section 1350 as Adopted
           Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

<PAGE>


                                   SIGNATURES



Commercial Evaluations, Inc.

NAME & POSITION

By:  /s/  Robert Barcelon                              Date: March 28, 2003
-------------------------------                        --------------------
          Robert Barcelon
          President

<PAGE>


                          COMMERCIAL EVALUATIONS, INC.

                              FINANCIAL STATEMENTS

                                DECEMBER 31, 2002


<PAGE>


                          COMMERCIAL EVALUATIONS, INC.

                                DECEMBER 31, 2002

                                    CONTENTS

                                                                          Page

Independent Auditor's Report                                                1

Financial Statements

         Balance Sheet                                                      2

         Statement of Operations                                            3

         Statement of Stockholders' Equity                                  4

         Statement of Cash Flows                                            5

         Notes to Financial Statements                                      6


<PAGE>


                   MARK SHERMAN, CPA PROFESSIONAL CORPORATION
                        601 SOUTH RANCHO DRIVE SUITE D-32
                            LAS VEGAS, NV 89106-4827
                    PHONE (702) 645-6318 FAX: (702) 645-1604
--------------------------------------------------------------------------------



                          INDEPENDENT AUDITOR'S REPORT

Board of Directors
Commercial Evaluations, Inc.
Las Vegas, Nevada

     We have audited the accompanying balance sheet of Commercial Evaluations,
Inc. as of inception, December 31, 1999, December 31, 2000, December 31, 2001
and December 31, 2002; and the related statement of operations, stockholders'
equity and cash flows from inception through December 31, 2002. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.

     We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.

     In our opinion, the financials referred to above present fairly, in all
material respects, the financial position of Commercial Evaluations, Inc. at
December 31, 1999, December 31, 2000, December 31, 2001 and December 31, 2002;
and the results of operations and their cash flows for the period ended December
31, 1999, December 31, 2000, December 31, 2001, December 31, 2002 and inception
to December 31, 2002 in conformity with generally accepted accounting
principles.



                                            /s/  MARK SHERMAN, CPA
                                            ----------------------------------
                                                 MARK SHERMAN, CPA
                                                 PROFESSIONAL CORPORATION

March 11, 2003

                                       -1-
<PAGE>



                          COMMERCIAL EVALUATIONS, INC.
                                  BALANCE SHEET


                                     ASSETS


                                            As of       As of        As of
                                           12/31/02    12/31/01    12/31/00
                                           --------    --------    ---------
CURRENT ASSETS
         Cash                              $  4,056    $ 12,413    $    283
         Other receivables                 $  1,400    $      0    $      0
         Prepaid Expenses                  $  4,787    $   1,50          -0-
                                           --------    --------    ---------
                    TOTAL CURRENT ASSETS     10,243    $ 13,913         283

FIXED ASSETS
         Equipment., Furn. & Fixtures,
         net of accum. depr. of $9,178     $ 14,977
         net of accum. depr. of $3,091                 $ 14,659
         net of accum. depr. of $1,228                             $  1,378

OTHER ASSETS
         Deposits                          $  3,806    $  2,064    $    -0-
         Investment in real estate           43,500      43,500
           TOTAL OTHER ASSETS              $ 47,306      45,564    $    -0-

                      TOTAL ASSETS         $ 72,526    $ 74,136    $  1,661
                                           ========    ========    =========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
         Accounts Payable                  $ 19,022    $  3,236    $   5,836
         Commissions Payable                    100       4,300         -0-
         Note payable                             0       1,833        4,730
         Current Portion of Lterm debt          400         305         -0-
                                           --------    --------    ---------
           TOTAL CURRENT LIABILITIES       $ 19,522    $  9,674    $  10,566

LONG-TERM LIABILITIES
         Note Pay, less curr. portion      $ 41,959    $ 41,207          -0-

STOCKHOLDERS' EQUITY
         Common Stock, $.001 par value
         Authorized 50,000,000 shares;
         Issued and outstanding at
         Dec 31, 2000, 2001 and 2002,
         500,000 Shares                    $    500    $    500    $     500

         Additional Paid In Capital        $ 92,181    $ 92,181    $  49,500

         Retained Earnings (Deficit)       ($81,636)   ($69,426)   ($58,905)
                                           --------    --------    ---------

         TOTAL STOCKHOLDERS' EQUITY        $ 11,045    $ 23,255    ($ 8,905)
                                           --------    --------    ---------

                  TOTAL LIABILITIES AND
                  STOCKHOLDERS' EQUITY     $ 72,526    $ 74,136    $  1,661
                                           ========    ========    =========


                 See accompanying notes to financial statements.

                                       -2-

<PAGE>
<TABLE>
<CAPTION>


                               COMMERCIAL EVALUATIONS, INC.
                                  STATEMENT OF OPERATIONS


                                                                            June 7, 1994
                                                                             (Inception)
                               Jan 1, 2002     Jan 1, 2001    Jan 1, 2000       to
                                    to             to             to          December
                               Dec 31, 2002    Dec 31, 2001   Dec 31, 2000    31, 2002
                                -----------    -----------    -----------    -----------
INCOME
<S>                             <C>            <C>            <C>            <C>
Revenue                         $   796,576    $   336,373    $    64,119    $ 1,197,068
                                -----------    -----------    -----------    -----------
TOTAL INCOME                        796,576        336,373         64,119      1,197,068


EXPENSES

General and
         Administrative         $   802,699    $   344,197    $   121,796    $ 1,268,692
                                -----------    -----------    -----------    -----------

Depreciation and Amortization   $     6,087    $     2,697    $     1,228    $    10,012
                                -----------    -----------    -----------    -----------
TOTAL EXPENSES                  $   808,786    $   346,894    $   123,024    $ 1,278,704

                                -----------    -----------    -----------    -----------
NET PROFIT (LOSS)               ($   12,210)   ($   10,521)   $    58,905)   ($   81,636)
                                ===========    ===========    ===========    ===========


NET PROFIT (LOSS)
PER SHARE                       ($     0.02)   ($      .02)   ($      .12)   ($     0.16)
                                ===========    ===========    ===========    ===========


AVERAGE NUMBER OF
SHARES OF COMMON
STOCK OUTSTANDING                   500,000        500,000        500,000        500,000
                                ===========    ===========    ===========    ===========


                      See accompanying notes to financial statements

                                            -3-
</TABLE>

<PAGE>


                          COMMERCIAL EVALUATIONS, INC.
                        STATEMENT OF STOCKHOLDERS' EQUITY



                                      Common Stock
                                      ------------
                                       Number              Additional  Retained
                                         of                 Paid In    Earnings
                                       Shares     Amount    Capital    (Deficit)
                                      --------   --------   --------   --------
Inception 6-7-94
To 12-31-99                                  0          0          0          0
                                      --------   --------   --------   --------

March 9, 2000
Issued for cash                        500,000   $    500   $ 49,500       --
Net (Loss), 12-31-00                      --         --         --     ($58,905)
                                      --------   --------   --------   --------

Balance Dec. 31, 2000                  500,000   $    500   $ 49,500   ($58,905)


Net (Loss), 3-31-01                       --         --         --     ($   191)
                                      --------   --------   --------   --------
Balance March 31, 2001                 500,000   $    500   $ 49,500   ($59,096)

Shareholder contributed capital           --         --     $ 34,697       --
   net (Loss), 6-30-01                    --         --         --     ($15,347)
                                      --------   --------   --------   --------
Balance June 30, 2001                  500,000   $    500   $ 84,197   ($74,443)

Shareholder contributed capital           --         --        6,635       --

Net loss, 9-30-01                         --         --         --     ($   825)
                                      --------   --------   --------   --------
Balance September 30, 2001             500,000   $    500   $ 90,832   ($75,268)

Shareholder contributed capital           --         --     $  1,349       --

Net income, 12-31-01                      --         --         --        5,842
                                      --------   --------   --------   --------
Balance, December 31, 2001             500,000   $    500   $ 92,181   ($69,426)

Net loss, 12-31-02                        --         --         --     ($12,210)
                                      --------   --------   --------   --------
Balance, December 31, 2002             500,000   $    500   $ 92,181   ($81,636)


                 See accompanying notes to financial statements.

                                       -4-

<PAGE>


                          COMMERCIAL EVALUATIONS, INC.
                             STATEMENT OF CASH FLOWS



                                     Jan 1, 2001     Jan 1, 2001     Jan 1, 2000
                                       to Dec          to Dec          to Dec
                                      31, 2002        31, 2001        31, 2000
CASH FLOWS FROM
OPERATING ACTIVITIES

Net Income (Loss)                     ($12,210)        ($10,521)      ($58,905)

Gain (Loss) on Sale of Equipment          --               --         (  2,669)
Depreciation                             6,087            2,697          1,228
Accounts Receivable dec(inc)          ($ 1,400)               0              0
Prepaid expenses increase             ($ 3,287)        ($ 1,500)             0
Other Assets increase                 ($ 1,742)        ($ 2,064)             0
Accounts Payable (dec)inc             $ 15,786         ($ 6,063)        10,566

Other Current liabilies inc (dec)     (  4,525)           6,133             63

CASH FLOWS FROM
OPERATING  ACTIVITIES                 ($ 1,291)        ($11,318)      ($49,717)

CASH FLOWS FROM
INVESTING ACTIVITIES

Purchase of Equipment                 ($ 6,406)        ($15,978)             0
Purchase of Real Estate                   --           (  1,000)          --

CASH FLOWS FROM
INVESTING ACTIVITIES                  ($ 6,406)        ($16,978)             0

CASH FLOWS FROM
FINANCING ACTIVITIES

Principal payments on notes payable   ($   660)        ( $2,255)             0
Issuance of common stock                   --              --              500
Additional paid-in capital                   0         $ 42,681       $ 49,500

CASH FLOWS FROM
FINANCING ACTIVITIES                  ($   660)        $ 40,426       $ 50,000

Net increase
(decrease) in Cash                    ($ 8,357)        $ 12,130       $    283

Cash
Beginning of Period                   $ 12,413         $    283       $      0
Cash
                                      --------         --------       --------
End of Period                         $  4,056         $ 12,413       $    283
                                      ========         ========       ========

Supplemental Disclosure of cash flow information:

Purchase of Real Property for $1,000 cash and assumption of notes payable of
$42,500.


                 See accompanying notes to financial statements.

                                       -5-

<PAGE>


                          COMMERCIAL EVALUATIONS, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                December 31, 2002

NOTE 1 - ORGANIZATION AND ACCOUNTING POLICIES

     The Company was incorporated June 7, 1994 under the laws of the State of
Nevada. The Company was organized to engage in any lawful activity. The
corporation was originally organized under the name of ZXS Corporation and on
February 29, 2000 changed its name to Commercial Evaluations, Inc.

     The Company's accounting policies and procedures are as follows:

     1.   The Company uses the accrual method of accounting.

     2.   Earnings per share are computed using the weighted average number of
          shares of common stock outstanding.

     3.   The Company has not yet adopted any policy regarding payment of
          dividends. No dividends have been paid since inception.

     4.   The Company depreciates its equipment based on the straight line
          method over the applicable useful lives of the assets.

     5.   The Company's fiscal year end is December 31st.

NOTE 2 - CASH

     For the Statements of Cash Flows, all highly liquid investments with
maturity of three months or less are considered to be cash equivalents. There
were no cash equivalents as of December 31, 2002, December 31, 2001 and December
31, 2000.


NOTE 3 - COMMON STOCK

     On March 9, 2000 500,000 shares of $.001 par value stock was issued in
exchange for $50,000.

NOTE 4- BUSINESS AGREEMENT

     The Company has an agreement with a Mortgage funding entity whereby the
Company provides mortgage loans to this funding company and the funding company
in turn processes and funds the mortgage loans. Substantially all of the
revenues generated by the Company are derived from this Mortgage funding entity.
Upon the closing of any mortgage loan a loan fee is paid to the Company for the
providing of the loan, usually 1% of the loan but it may vary depending on the
credit worthiness of the customer.

NOTE 5-LEASE AGREEMENTS

     The Company entered into a 3 year lease of its facilities beginning
     September 1, 2001. The agreement calls for 5 monthly payments starting with
     October 1, 2001 at $1,474.40 and then $6,000 to be prorated for the
     remainder of the lease with (8%) interest. The rent for months 7-12 calls
     for base rent of $2,228.66 plus the prorated amount. The lease calls for
     annual increases of 5 cents per square foot.

                                       -6-

<PAGE>


                          COMMERCIAL EVALUATIONS, INC.
                     NOTES TO FINANCIAL STATEMENTS (CONT'D)
                                December 31, 2002

     NOTE 5-LEASE AGREEMENT (CONT'D)


     The future minimum lease commitments are as follows:


                  2003                      30,724
                  2004                      26,391


     On January 28, 2002 the Company entered into a 30 month lease of additional
     facilities. The agreement calls for 30 monthly payments fixed at $2,242.35
     per month.

     The future minimum lease commitments are as follows:

                  2003                      26,908
                  2004                      17,938

     NOTE 6-NOTE PAYABLE-REAL ESTATE

     On November 15, 2001 the Company purchased a condominium for $1,000 and
     assumed the existing first and second deed of trust on this property. The
     purchase price was $43,500 and the notes totaled $43,500 of which the
     $1,000 was used as a down payment. The first deed of trust assumed was for
     $35,598.82 at 13% with payments of $400.49 per month until paid in full.
     The second deed of trust assumed was for $7,901.18 at 13% with payments of
     $85.60 per month until paid in full. The current portion of long-term debt
     on this note is $400. On November 20, 2001 the Company entered into an
     agreement to rent out this property for $600.00 per month. For the year
     ended December 31, 2002 $2,647 worth of rental was collected and included
     in revenues.


     NOTE 7-RECOGNITION OF REVENUE/COMMISSIONS EXPENSE

     An Officer of the Company in his capacity as one of the sales
     representatives has an agreement with the Company to receive 100% of his
     commissions related to the loans that he personally closes. Included in
     revenues for the years ended December 31, 2001 and 2002 were $146,709 and
     $7,100 respectively of sales that were also accrued as commissions payable
     to the Officer.

     NOTE 8 - SUBSEQUENT EVENT

     On January 23, 2003, the Company sold the condominium indicated in Note 6
     for $50,000. The buyer assumed the notes payable.

                                       -7-