FORM 10Q-SB

General Form for Registration of Securities

of Small Business Issuers



Under Section 12(b) or (g) of

the Securities Exchange Act of 1934



Wintech Digital Systems Technology Corporation

(Exact name of Registrant as specified in its charter)





|NEVADA                                         | 0-30553                   | 88-0325524                          
|---------------------------------------------- | ------------------------- | ------------------------------------
|(State or other jurisdiction of incorporation) | (Commission  File Number) | (I.R.S. Employee Identification No.)





2nd Floor, Caihong Building, 11 Xinxi Road, Shangdi, Haidian District, Beijing, China 100085 (Address of principal executive offices)



Registrant's telephone number, including area code: (8610) 82782828



[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934





For the quarterly period ended March 31, 2004



[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934



Indicate  the  number of shares  outstanding  of each of the  registrant's

classes of common stock, as of the latest practicable date.



Class                     Outstanding as of   March  31, 2004



$0.001 Par Value     14,992,100 Class A Common Stock Shares







TABLE OF CONTENTS



PART 1

FINANCIAL INFORMATION



ITEM  1.  FINANCIAL  STATEMENTS



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



ITEM  3.  CONTROLS AND PROCEDURES







PART II

OTHER INFORMATION



ITEM  1.  LEGAL  PROCEEDINGS



ITEM  2.  CHANGES  IN  SECURITIES AND USE OF PROCEEDS



ITEM  3.  DEFAULTS UPON SENIOR SECURITIES



ITEM  4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY  HOLDERS



ITEM  5.  OTHER INFORMATION



ITEM  6.  EXHIBITS  AND  REPORTS  ON  FORM  8-K



SIGNATURES



INDEX  TO  EXHIBITS









PART 1. FINANCIAL INFORMATION



Item 1. Financial Statements.



Wintech Digital Systems Technology Corporation

Index To Unaudited Condensed Consolidated Financial Statements



|                                                   | Pages
|-------------------------------------------------- | -----
|Condensed Consolidated  Balance  Sheet             | F-1  
|Condensed Consolidated  Statement  of  Operations  | F-2  
|Condensed Consolidated  Statement  of  Cash  Flows | F-3  













Wintech Digital Systems Technology Corp.

Condensed Consolidated  Balance  Sheet as of March  31, 2004

(Unaudited) and June 30, 2003 (Audited)



|ASSETS                                | As of  March 31, 2004 | As of June 30, 2003
|------------------------------------- | --------------------- | -------------------
|(Unaudited)                           | (Audited)            
|USD                                   | USD                  
|Current Assets                        |                       |                    
|Cash and cash equivalents             | $724,744              | $707,101           
|Accounts receivable, net of allowance | 63,130                | 42,122             
|Other receivables                     | 53,121                | 48,162             
|Inventory
(Note 2)                    | 270,099               | 293,620            
|Total Current Assets                  | 1,111,094             | 1,091,005          
|                                      |                       |                    
|Property and equipment                | 224,309               | 210,229            
|Accumulated depreciation              | (127,242)             | (104,532)          
|Total property and equipment          | 97,067                | 105,697            
|                                      |                       |                    
|Total Assets                          | $1,208,161            | $1,196,702         





See notes to condensed consolidated financial statements















|                                 | LIABILITIES & STOCKHOLDERS' EQUITY

Current Liabilities                                                                                     
|-------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------
|                                 | Accounts payable                                                                                                                            
|                                 | Accrued expenses                                                                                                                            
|                                 | Due to a director                                                                                                                           
|                                 | Other taxes payable                                                                                                                         
|                                 | Income taxes payable                                                                                                                        
|                                 | Total Current Liabilities                                                                                                                   
|                                 |                                                                                                                                             
|                                 | Commitments and Contingencies                                                                                                               
|                                 |                                                                                                                                             
|                                 | Stockholders'  Equity
Common stock, 200,000,000 shares authorized par value of $0.001; 14,992,100 & 13,813,700 shares issued and outstanding
|                                 |                                                                                                                                             
|                                 | Non-voting shares par value of US$0.001; 1,200,000 & 1,700,000 shares                                                                       
|                                 |                                                                                                                                             
|                                 | Additional paid in capital                                                                                                                  
|                                 |                                                                                                                                             
|                                 | Accumulated deficit                                                                                                                         
|                                 |                                                                                                                                             
|Amounts due from related parties | (120,239)                                                                                                                                   
|                                 |                                                                                                                                             
|                                 | Statutory reserves                                                                                                                          
|                                 |                                                                                                                                             
|                                 | Net Stockholders' Equity                                                                                                                    
|                                 | Total Liabilities and Stockholders' Equity                                                                                                  





F-1

Wintech Digital Systems Technology Corp.

Condensed Consolidated Statement of Operations





|                                             | For the Three Months Ended March 31 | For the Nine Months Ended March 31
|-------------------------------------------- | ----------------------------------- | ----------------------------------
|                                             | 2004                                | 2003                              
|                                             | (Unaudited)
USD                     | (Unaudited)
USD                   
|Revenues
Sales of Products and Services      | $231,902                            | $205,059                          
|                                             |                                     |                                   
|Cost of Products and Services                | (87,894)                            | (71,808)                          
|Gross Profit                                 | 144,008                             | 133,251                           
|Expenses                                     |                                     |                                   
|Selling, general and administrative expenses | (147,805)                           | (177,513)                         
|Loss from Operations                         | (3,797)                             | (44,262)                          
|Other Income                                 | 0                                   | 107                               
|Interest income                              | 919                                 | 1,351                             
|Total Other Income                           | 919                                 | 1,458                             
|                                             |                                     |                                   
|Loss before income taxes                     | (2,878)                             | (42,804)                          
|Provision for income tax                     | 0                                   | 0                                 
|Net loss .                              | $(2,878)                            | (42,804)                          
|Basic Loss Per Share                         | (0.0002)                            | (0.003)                           
|Diluted Loss Per Share                       | (0.0002)                            | (0.003)                           
|Weighted Average Shares Outstanding          | 16,192,100                          | 15,513,700                        



See notes to condensed consolidated financial statements

F-2

Wintech Digital Systems Technology Crop.

Condensed Consolidated Statement of Cash Flows



|                                                                                | For the Nine Months Ended March 31
|------------------------------------------------------------------------------- | ----------------------------------
|                                                                                | 2004                              
|                                                                                | (Unaudited)
USD                   
|Cash Flows from Operating Activities                                            |                                   
|Net Loss                                                                        | $(93,371)                         
|                                                                                |                                   
|Adjustments to Reconcile Net Loss to Net Cash Provided by Operating Activities: |                                   
|Depreciation                                                                    | 22,710                            
|Expenses not involving cash flows - compensation cost                           | 18,655                            
|Changes in Operating Assets & Liabilities                                       |                                   
|Increase in accounts receivable                                                 | (21,008)                          
|Decrease in inventory                                                           | 23,521                            
|(Increase) Decrease in other receivable                                         | (4,959)                           
|Decrease in advances to suppliers                                               | 0                                 
|Increase (Decrease) in accounts payable                                         | 5,175                             
|Decrease in income taxes payable                                                | (326)                             
|Increase in other taxes payable                                                 | 47,027                            
|Increase in accrued expenses                                                    | 11,180                            
|Increase in due to a director                                                   | 23,119                            
|Net Cash (Used in) Provided by Operating Activities                             | 31,723                            
|                                                                                |                                   
|Cash Flows from Investing Activities                                            |                                   
|Purchase of fixed assets                                                        | (14,080)                          
|Net Cash Used in Investing Activities                                           | (14,080)                          
|                                                                                |                                   
|                                                                                |                                   
|(Decrease) Increase in Cash and Cash Equivalents                                | 17,643                            
|                                                                                |                                   
|Cash & Cash Equivalents at Beginning of Period                                  | 707,101                           
|                                                                                |                                   
|Cash & Cash Equivalents at End of Period                                        | $724,744                          





See notes to condensed consolidated financial statements





F-3











Wintech Digital Systems Technology Corp.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS





Note 1.       Basis of Presentation



The accompanying financial statements as of March 31, 2004 and for the nine-month period ended March 31, 2004, have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission.  Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles in the United States of America generally accepted have been condensed or omitted pursuant to such rules and regulations.  However, the Company believes that the disclosures are adequate to make the information presented not misleading.  These financial statements should be read in conjunction with the financial statements and the notes thereto included in the Companys audited annual financial statements for the year ended June 30, 2003.



The preparation of 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, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities.  Actual results could differ from these estimates.



In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position as of March 31, 2004, the results of operations for the three-month period and nine-month period ended March 31, 2004 and cash flows for the nine-month period ended March 31, 2004, have been made.  The results of operations for the three-month period and nine-month period ended March 31, 2004 are not necessarily indicative of the operating results for the full year.





Note 2.

Inventory

|                                    | As of  March 31, 2004 | As of June 30, 2003
|----------------------------------- | --------------------- | -------------------
|(Unaudited)                         | (Audited)            
|USD                                 | USD                  
|Inventories comprise the following: |                       |                    
|                                    |                       |                    
|Raw materials                       |                       | 137,052            
|Work-in-progress                    |                       | 34,310             
|Finished goods                      |                       | 122,258            
|                                    |                       |                    
|                                    | 270,099               | 293,620            





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





The following discussion and analysis should be read in conjunction  with the Company's financial statements and notes thereto included elsewhere in this Form 10-QSB.  Except for the historical information contained herein, the discussion in this Form 10-QSB contains certain  forward  looking  statements that involve risks and uncertainties,  such as statements of the Company's plans, objectives, expectations and intentions.  The cautionary statements made in this Form 10-QSB should be read as being applicable to all related forward statements wherever they appear in this Form 10-QSB.





A.

Managements Discussion and Analysis of Financial Condition and Results of Operations



Three months ended March 31, 2004 compared to three months ended March 31, 2003



Three Months ended

March 31, 2004                        March 31, 2003

(Unaudited)                                 (Unaudited)

Net sales        $231,902                                   $205,059



Nine months ended March 31, 2004 compared to nine months ended March 31, 2003



Nine Months ended

March 31, 2004                        March 31, 2003

(Unaudited)                                 (Unaudited)

Net sales        $817,008                                   $670,471





The increase in revenue was due to the increase in the sales of new products, such as TDS560 and DAM6416P-V. TI (Texas Instrument) development tools sales also increased.



Costs  consist  primarily of material purchases, salaries for  engineers,  costs of promotion,  rental expenses,   depreciation  and other  miscellaneous  expenses.   The increase in the  cost of materials and cost  of promotion was primarily  attributable  to  the increase in sales. Starting from the quarter ended March 31, 2004,  Mr. Yonghong Dong has agreed to waive his salary of US$50,000 for each quarter,  Selling, general and administrative expenses decreased by US$33,505 compared with the same period last year

The gross profit margin of products increased from 65% in the same period last year to 74% in the quarter ended March 31, 2004. This increase is the result of the increase in the sales of new products with profit margins exceeding 75%.



The inventory decreased by $23,521 compared with that as of June 30, 2003.  The decrease of inventory is due to the increase in sales and enhanced planning in purchasing.



The Company is not aware of any circumstances or trends which would have a negative impact upon future sales or  earnings.  There have been no material fluctuations in the standard seasonal variations of the Company's business.  The accompanying financial statements include all adjustments, which in the opinion of management  are  necessary  in order to make the  financial  statements  not misleading.





Liquidity  and  Capital  Resource.



As of March 31, 2004, cash and cash equivalents were $724,744 versus  $707,101 as of June 30, 2003.  The increase in cash is mainly due to the delay in payment of certain liabilities.



Business  Risks.



While maintaining its core business in emulator and DSP (Digital Signal Processing) board development and sales,  the Company has been focusing its resources in new video product line such as IP (Internet Protocol)  Video solutions.  If the Company can not finish the development quickly, the Company may fail to capture any market share in this new business. That means the Company may fail to execute its strategy for significant increases in its revenue.





Competition.



While competition in its emulator and DSP board business still exists, the Company will also face new competition when it  enters the video device market. For example, in the IP Video Phone and video surveillance business, there are many companies around the world using the newest DSP chips to develop similar products. While the Company believes it can develop advanced products/solutions at lower cost, there is no guarantee that the Company will have any advantage over competition in  terms of technology or price.

Management of Growth.



The Company continue to improve its emulator products for international markets. New TDS560USB2.0 will also be released soon.  The Company believes that the new emulator will improve its sales in China and in the global market.  Since the emulator market is limited, the Company is focusing on the video device market, hoping to gain access to the mass market in order to significantly increase its revenue.



B.

Plan of Operation



The Company believes that its cash reserve is sufficient for its operations for the next 12 months and there is no plan to raise funding during the next 12 months. The Company is continuing in the development of TDS560USB2.0 and its IP-based Video phone product and hopes to release TDS560USB2.0 in the next quarter.







Item  3.  Controls and Procedures

Evaluation of disclosure controls and procedures: The Company's chief executive officer and chief financial officer, after evaluating the effectiveness of the Company's disclosure controls and procedures (as defined in Sections 13a-14(c) and 15d-14(c) of the Securities Exchange Act of 1934, as amended), as of a date (the "Evaluation Date") within 90 days before the filing date of this quarterly report, have concluded that as of the Evaluation Date, the Company's disclosure controls and procedures were adequate and are designed to ensure that material information relating to the Company would be made known to such others within the Company.



Changes in internal controls: There were no significant changes in the Company's internal controls or in other factors that could significantly affect these controls subsequent to the Evaluation Date.















PART  II  -  OTHER  INFORMATION



Item  1.  Legal  Proceedings



None.



Item  2.  Changes  in  Securities and Use of  Proceeds

None.







Item  3.  Defaults  Upon  Senior  Securities



None.



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



None.



Item 5. Other information



On April 19, 2004, the Company signed "Windows Media Format Components Distribution License" agreement with Microsoft. The Company plans to adapt Microsoft Windows Media software to its DM642 board. The Company's DM642 hardware and software package is being developed for applications such as IP video phone, video conference, and security surveillance systems.



Item  6.  Exhibits  and  Reports  on  Form  8-K



None



CERTIFICATION PURSUANT TO

18 U.S.C. ss. 1350, AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002



I, Jianpeng Zhang, Chief Financial Officer of Wintech Digital Systems Technology Corp., certify that:



1.   I have reviewed this quarterly report on Form 10-QSB for the period ended March 31, 2004 of Wintech Digital Systems Technology Corp.;



2.   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;



3.   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;



4.   The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d- 15(f)) for the registrant and have:



(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;



(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our  supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;



(c) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and



(d) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and



5.   The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):



(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and



(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.



May 15, 2004



/s/ Jianpeng Zhang

--------------------------------------------

Jianpeng Zhan, Chief Financial Officer







CERTIFICATION PURSUANT TO

18 U.S.C. ss. 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002



Solely for the purposes of complying with, and the extent required by 18 U.S.C.1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned certifies, in his capacity as the Chief Financial officer of Wintech Digital Systems Technology Corp., that, to his knowledge, the Quarterly Report of the  company on Form 10-QSB for the period ended March 31, 2004, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in the report fairly presents, in all material respects, the company's financial condition and results of operations.



May 15,2004



/s/ Jianpeng Zhang

--------------------------------------------

Jianpeng Zhang, Chief Financial Officer









CERTIFICATION PURSUANT TO

18 U.S.C. ss. 1350, AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002



I, Yonghong Dong, Chief Executive Officer of Wintech Digital Systems Technology Corp., certify that:



1.   I have reviewed this quarterly report on Form 10-QSB for the period ended March 31, 2004 of Wintech Digital Systems Technology Corp.;



2.   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;



3.   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;



4.   The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d- 15(f)) for the registrant and have:



(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;



(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our  supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;



(c) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and



(d) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and



5.   The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):



(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and



(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.



May 15,2004



/s/ Yonghong Dong

--------------------------------------------

Yonghong Dong, Chief Executive Officer







CERTIFICATION PURSUANT TO

18 U.S.C. ss. 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002



Solely for the purposes of complying with, and the extent required by 18 U.S.C.1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned certifies, in his capacity as the  Chief Executive Officer of Wintech Digital Systems Technology Corp., that, to his knowledge, the Quarterly Report of the  company on Form 10-QSB for the period ended March 31, 2004, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in the report fairly presents, in all material respects, the company's financial condition and results of operations.



May 15,2004



/s/ Yonghong Dong

--------------------------------------------

Yonghong Dong, Chief Executive Officer