# UNITED STATES SECURITIES AND
EXCHANGE COMMISSION Washington, D.C. 20549

# Form 10-KSB

[X]    
          ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For
the fiscal year ended December 31, 2003

TALLY-HO VENTURES, INC.
                             a Delaware corporation
                                518 Oak Street #2
                               Glendale, CA 91204
                                 (818) 550-7886

I.R.S.
          Employer Identification No.: 43-1988542

Check
whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of
the Exchange Act during the past 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing requirements
for the past 90 days. Yes [X] No [   ]

Check if there is no disclosure of
delinquent filers in response to Item 405 of Regulation S-B is not contained [sic] in this
form, and no disclosure will be contained, to the best of registrants knowledge, in
definitive proxy or information statements incorporated by reference in Part III of this
Form 10-KSB or any amendment to this Form 10-KSB. [X]

State issuer's revenues for its most recent fiscal year.    $0.

Issuers
common equity has no market value currently.

The
number of shares outstanding of the issuers sole class of common equity, as of
December 31, 2003, is: 44,215,875.

Transitional Small Business Disclosure Format (Check one): Yes [   ]; No [X]

1

# TALLY-HO VENTURES, INC.

# INDEX

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|PART I
ITEM 1. 
ITEM 2. 
ITEM 3. 
ITEM 4. 
PART II
ITEM 5. 
ITEM 6. 
ITEM 7. 
ITEM 8A. 
PART III
ITEM 9.
ITEM 10.
ITEM 11.
ITEM 12.
ITEM 13.
ITEM 14. | BUSINESS                                                                              
PROPERTIES                                                                            
LEGAL PROCEEDINGS                                                                     
SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                                   
MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS             
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 
FINANCIAL STATEMENTS                                                                  
CONTROLS AND PROCEDURES  
DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT                                    
EXECUTIVE COMPENSATION                                                                
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT                        
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS                                        
EXHIBITS, LISTS AND REPORTS ON FORM 8-K                                               
PRINCIPAL ACCOUNTANT FEES AND SERVICES | Page
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# PART I

# Item 1. Description of
Business.

Principal products or services and
their markets. We are a development-stage company in the business of producing
entertainment products, principally short films, web-exclusive videos vignettes and skits,
and pilot (one full-episode test) television programs. We also are currently
engaged in producing entertaining written material  such as comedic essays and
free-form prose  and posting these and our other products to our website
www.tallyhoventures.com.

The short film we have produced so
far and the short films we intend to produce in the future are produced as follows. First,
we start with an idea. This idea typically comes from one of our three founders, Tal
Kapelner, Cheney Shapiro or Ariella Kapelner, and it usually consists of no more than a
simple idea for a plot or storyline or interesting concept or even just a clever line of
dialogue that a story can be built around. To describe it most simply, an idea is the
completion of a what if scenario. Ideas are a byproduct of inspiration,
the occurrences of which are very difficult to predict.

Once an idea is hatched by one of our
three founders, either that founder or, more typically, Tal Kapelner alone, will begin to
write a short screenplay, which is a script written for the screen, encompassing that
idea. This process can take up to several months. During this time, a director and one or
more producers are decided upon for the production. Producers are those
individuals who manage and oversee the co-ordination of all of the elements to making a
film, including actors, writers, directors, propmen, wardrobe personnel, etc., as well as
co-ordinate with any legal and other professional personnel to handle any and all
regulatory, accounting or union paperwork and other issues regarding the making of the
film. Because of our short resources, typically Cheney Shapiro and Tal Kapelner are our
two producers for all of our projects, and Tal Kapelner is our director.

Once the script is written, the
producers create a budget and a time line for production, based upon what the script calls
for. For example, a 10-page script that has all the action take place in one room of a
standard home would be cheaper and faster to produce than a 40-page script which calls for
car chases.

Once the budget and production
schedule are decided upon, financing is sought. Financing films, both short films and
features, is a difficult process, and it becomes more difficult the larger the budget.
This is for several reasons. First, there are simply not that many individuals and
entities worldwide who can put up the amount of money typically needed to finance an
average-budget feature film, currently about $30 million. Second, recouping money from a
film is a long process, as there is typically a gap of 1-3 years between the time the
money is paid to finance the film, and the theatrical release of the film. And if the
theatrical release did not recoup all of the financiers money, then the financiers
will have to wait to recoup their money until more money is brought in from overseas
markets; ancillary markets, which are non-theatrical markets such as military and airplane
exhibitions; sales of video and DVD copies of the film; and cable television and broadcast
network exhibitions. Finally, often times films dont recoup the money that is spent
on them ever, making financing films extremely risky. And financing short films is
typically more difficult than financing feature films, because although short films are
much cheaper to produce  they cost usually less than $100,000  there are much
fewer opportunities to exhibit them, and therefore fewer ways by which to recoup the
investment.

For these reasons, funding is
typically the most demanding, and oftentimes the longest, part of every project. Funding
for films is so elusive, in fact, that most organizations which seek to help the
independent filmmaker, such as Independent Film Project and Filmmakers Alliance of Los
Angeles, will not even address the key matter of funding and will focus instead on
providing inexpensive resources by which to make films, once funding has already been
achieved.

3

There are some sources of funding
available specifically for films, however. The two major types of funding are fundraising
and financing. Fundraising refers to grants and corporate gifts, while financing includes
both debt and equity financing. Sources for fundraising include the Film Arts Foundation
in San Francisco (www.filmarts.org), The Independent magazine
(www.aivf.org/independent) and The Foundation Center (www.fdncenter.org), all of
which have a list of foundations issuing grants, with information about each grant such as
deadlines, criteria, etc. We intend to pursue this line of funding whenever practicable.
Each project will have to be analyzed to see if it is a good fit for a funding entity.
Entertainment attorneys may also be contacted to provide guidance or consulting or
introduction to brokers, dealers or finders who may assist in locating financiers.

Both debt and equity financing shall
be used as needed whenever fundraising is not a viable option. The manner by which we will
generally seek to secure financing will depend upon the level of financing we will need.
For smaller budgeted short films, we shall rely on stock offerings such as this one, or
upon loans from management or another benefactor, or upon an equity investment from a
benefactor or venture capital group. For larger budgeted films, we will rely almost
exclusively on stock offerings similar to this or seek large-scale private financing.

With the money, budget, schedule and
script in place, the producers meet to more carefully plan out the pre-production process.
Pre-production refers to the time period when the film is being made but
nothing has been shot yet. During this time, we generally will be contacting SAG to
arrange for the signing of a contract that allows us to hire professional actors. We will
fill out the myriad paperwork and produce the $500-$1000 deposit required by SAG at this
time and hire a payroll company that will help us secure workers compensation
insurance for our actor employees as well as process payroll for the actors.

We have made a conscious decision to
not sign with other talent unions, including the directors guild, writers guild or the
International Alliance of Theatrical Stage Employees (IATSE), which is the union for most
crewmember positions, as that would severely limit the non-acting talent we would be able
to hire, increase our costs by forcing us to hire all non-actors as employees rather than
independent contractors, and force us to adhere to many rules regarding workplace
environment which are geared towards larger productions and would unnecessarily increase
the costs of our modestly-budgeted projects.

Concurrently with working with the
actors union and ensuring that all legal and union regulatory compliance is made, casting
is completed. We generally will be hiring professional acting talent, in order to cheaply
enhance the quality and visibility of our work. In order to procure such talent, the
general procedure is to post breakdowns, which are descriptions of the
characters we are casting. Popular outlets to post breakdowns include
breakdownservices.com; the Backstage newspaper and backstage.com, divisions of VNU
Business Media; castnet.com; and, for background actors (extras), Central
Casting, a division of Entertainment Partners. These outlets typically charge $0 
$75 for an entire cast of character breakdowns.

After posting the breakdowns, a large
number of submissions will flow to our production offices, at which time the producers and
director will review the submissions and audition 2-6 actors for each role being cast,
eventually casting one actor for each role.

Concurrently with casting the film,
wardrobe and props are purchased by the producers, any film equipment necessary is rented
and crewmembers are hired to perform certain technical tasks in the shooting of the film.
Tally-Ho owns none of its own equipment and will have to rent equipment for each of its
shoots. Tally-Ho locates its crewmembers quite easily by simply typing into a Google
search the name of the technical position required, along with the word hire,
and then browsing the results.

4

www.mandy.com and
www.mediaresourcecontacts.com are also two common sources of non-union non-actor
talent, as are the Independent Film Project (www.ifp.org) and the Filmmakers
Alliance (www.facommunity.org) organizations, which have non-union crewmember
directories.

Securing shoot locations is also
important. Tally-Ho neither owns nor leases any studio space for the purpose of shooting
films. Both IFP and Filmmakers Alliance have production studios available for very low
budget films, and oftentimes films can be filmed inside private homes or offices,
depending upon the script.

Once all of the above arrangements
have been made in pre-production, the shooting of the film begins. The scenes, as written
in the script, are shot. Expenses, such as food for the cast and crew and transportation
to and from the location sites, were incurred during this period.

After the shooting of the film, the
post-production process begins. An editor is chosen, the images recorded during the shoot
are catalogued and the director and editor, along with the producer occasionally, sit in
an editing bay and piece the footage together. It is during post-production that any
additional sound effects, narration, music or visual effects are added. Tally-Ho neither
owns nor leases any of its editing space or equipment, which is available either from the
editor him or herself, or from non-profit organizations that cater to the independent
filmmaker, such as IFP and Filmmakers Alliance, or from higher cost mainstream editing
rental facilities.

Also during the post-production
period, clean-up paperwork is done on the production, including bookkeeping, SAG
recordkeeping, tax and payroll recordkeeping, etc.

Finally, after the film is finished,
as determined typically by the director and producers, copies of the film are made in
whatever media is determined to be suitable and distributed as we describe below. A
producers rep, who acts essentially as an agent for the film, may be
hired on a contingency basis to represent the film at film festivals and markets and
attempt to secure a buyer or exhibitor for the film.

We anticipate most of our short films
to cost approximately $13,000, and most of our super-short films, those under 10 minutes
in length, to cost approximately $5,000. The timeframe for completing a short film from
script to final print is approximately 5-9 months, while the timeframe for completing a
super-short film is approximately 2-5 months.

One can consider the case of our
first short film, The G! True Tinseltown Tale: Dude, Wheres My Car? as
an illustration of the general process of making our products we describe above. In the
case of G! Dude? Tal Kapelner wrote the script in the fall of 2002 and, once
Tally-Ho was incorporated, both Mr. Kapelner and Cheney Shapiro got on board as producers.
Tal Kapelner was named director, and the two producers ironed out a budget based upon a
22-page script, which translates to approximately 22 minutes of running time. The budget
was fixed at $4,000 and a production schedule of 4 months was considered reasonable. In
our case, financing $4,000 for our first short film was not difficult because Tal Kapelner
financed it himself.

During pre-production for our
G! Dude? project, Tal Kapelner served as liaison with the Screen Actors Guild
and worked with them to sign the Experimental Film Agreement. He produced the $500 deposit
SAG requested and filled out all the paperwork. He also retained a payroll company to
properly process the payrolls of the actor employees hired for the shoot, and procured
workers compensation insurance from the State Insurance Compensation Fund, to cover
the actor employees on the set in case of injury.

5

Tal Kapelner and Cheney Shapiro cast
our G! Dude? film. They decided to cast Tal Kapelner to play the part of
Ashton Kutcher and Cheney Shapiro to play the part of Shera Friendly. They decided to cast
other professional actors to play the other four on-camera roles, and posted a breakdown
of each role being cast, on an online service mentioned above called
breakdownservices.com. This online service is a service where actors can log on and view
all of the roles available at that time in a wide variety of media, including television,
film, commercials and industrial or instructional media. Over the two weeks following the
posting of our breakdowns for our G! Dude? project, we received over 500
e-mailed and mailed submissions from actors all over the country, principally from Los
Angeles. Each submission carried with it a photo of the actor and a resume. Mr. Kapelner
and Ms. Shapiro pored over all of the submissions and selected approximately 3-5 actors to
audition for each of the four roles offered. After the auditions, one actor for each of
the four roles was chosen, and each of the respective actors agent or manager was
contacted and told that his or her client has been given the role. The total cost of the
actors services was approximately $1,200 total, which included mandatory
contributions to the SAG/Producers Pension and Health Fund and all employer taxes.

Also during pre-production, the
producers hired a cameraman who could serve as the director of photography (DP) and could
provide his own camera, sound and lighting equipment. Brian Solari was hired as the DP and
the cameraman for the shoot. He was recommended to the producers by Eric Sherman, an
acquaintance who is himself an accomplished director. Because Mr. Solari also had
expertise in the area, the producers were able to save money by using him as his own
lighting technician as well. Mr. Solari requested that a script supervisor be hired for
the shoot, and Krista Bean was hired as script supervisor through www.mandy.com,
responsible for keeping careful notes of how the shooting of the film progressed
vis-à-vis the script, and thereby providing valuable data for the editor during the
post-production process. Two production assistants, roughly equivalent to
gophers, were hired, and a friend of the producers volunteered her services as
make-up artist. The total cost of hiring crewmembers and renting equipment for the shoot
was approximately $1,000.

In the G! Dude?
production, the producers were able to secure the house and grounds of a business
associate in Los Angeles for the shooting of most of the scenes in our film, while the DP
allowed us to use the dance studio of one of his former clients, located in La Canada
Flintridge, just north of Los Angeles, as the location of the remainder of the scenes.

The film was shot on digital video,
which requires no film nor analog videotape, and is, for this and other reasons, cheaper
than both film and analog video. G! Dude? took two days to shoot.

Brian Solari, our DP, who also has
his own editing bay and equipment, was chosen to also edit the film, and Tal Kapelner, as
director and producer, and Cheney Shapiro, as producer, joined with Mr. Solari in the
post-production process. We are currently in this post-production process.

Tal Kapelner, as executive producer,
handled the clean-up paperwork described above.

The cost of our G! Dude?
project is more than we anticipated. The final budget will be approximately $7,000,
whereas we had budgeted $4,000 initially. In the future, other short films will likely be
more expensive, as our first short film was made especially cheap by the fact that our
script called for mostly home interview scenes.

6

The process for making our
web-exclusive vignettes is the same as described above for making short films; however,
the method of distribution is much simpler: We only upload the finished products up to our
website for viewing exclusively on the web. This web-exclusive method of
distribution also allows us to sign a cheaper contract with SAG. The Internet-only
contract with SAG dramatically reduces our SAG-related paperwork and allows us to forego
paying any security deposit to SAG.

Given bandwidth considerations and
our opinion that attention spans are shorter among web surfers than among those watching
conventional video, we anticipate most of our web-exclusive products to fall in the
super-short films category of under 10 minutes and therefore cost approximately $5,000
each and be completed in 2 months time, from script to final print, which is on the low
end of the timeframe estimate for super-short films in general.

Our pilot television
programs are produced in the same manner as our short films above; however, we are obliged
to sign a more expensive contract with SAG, which requires minimum weekly salaries for
actors of over $3,000 per actor and enough paperwork to force us to hire a full-time
producer just to handle actors payroll and paperwork issues.

Additionally, our TV pilots will have
to use more than one camera to capture the simultaneous action; three is standard for a TV
show. A studio set will have to be rented, and more wardrobe will be required. For these
reasons, we have budgeted our first TV pilot at $100,000 and anticipate future TV pilots
to be budgeted similarly with an estimated time frame of 3-9 months for completion per
project.

As with our film projects, described
above, the two major types of funding for our television pilots and web-exclusive
vignettes will be fundraising and financing, both of which we shall pursue as is
practicable. Each project will have to be analyzed first to see if it is a good fit for a
funding entity. Entertainment attorneys may also be contacted to provide guidance or
consulting or introduction to brokers, dealers or finders who may assist in locating
financiers.

Both debt and equity financing shall
be used as needed whenever fundraising is not a viable option. The manner by which we will
generally seek to secure financing will depend upon the level of financing we will need.
For smaller budgeted short films, we shall rely on stock offerings such as this one, or
upon loans from management or another benefactor, or upon an equity investment from a
benefactor or venture capital group. For larger budgeted films, we will rely almost
exclusively on stock offerings similar to this or seek large-scale private financing.

Finally, our entertaining written
material, including free-form prose, etc., is written primarily by Tal Kapelner for no
fee. Mr. Kapelner is not under contract with Tally-Ho to produce a certain quantity or
quality of work, and makes contributions when inspiration strikes and his schedule allows.
Mr. Kapelners material is sent to our web designer, Steve Aguilera of
GraphicPark.net, and is uploaded onto our website at a rate of $75 per hour, which
translates to approximately $10 per written entertainment product we produce.

The market for our products is
principally members of the entertainment industry, particularly those in charge of
programming and finances. We ultimately are seeking professional production opportunities
in television and film, and in order for us to be retained for such producing services we
seek, we must make our work recognizable among members of the entertainment industry who
are in the position to offer us such professional producing opportunities.

7

A lesser market for our products
would be the public at large. We feel that if we got the attention of enough people,
regardless of whether they worked in the entertainment industry or not, there would be
enough positive word of mouth about our work to generate the kind of producing
opportunities described above.

The short- and long-term overall
financial plan. We have used no-interest loans from members of our management for our
initial administrative costs, including accountants fees, as well as the initial
development of our website and the production of our first major entertainment product, a
short film parody. We are hoping that we are able to sell enough shares in this offering
to allow us to a) maintain our administrative responsibilities, b) maintain and
periodically update our website, and c) continue to market our products and d) make more
products, over the next 12 months. Please see Managements Discussion and Analysis or
Plan of Operation below. If we do not sell enough shares to do this, Management will be
required to meet its commitment and personally loan Tally-Ho funds in order for our
administrative responsibilities for the next year to be met, including the application for
a listing on the OTC Pink Sheets later this year. We may also try to obtain a loan from a
benefactor or a lending institution, or conduct a future money raise, such as a private
placement offering, although none of these are currently planned. Within three years, we
hope to be offered a budget from a film and/or television distribution company or
television network to produce a film or television program.

We intend to initially apply for a
priced quotation on the OTC Pink Sheets within the coming year.

Distribution and marketing. The
first way we intend to market and distribute our entertainment products is to post most of
them on our website, www.tallyhoventures.com, and make them available for viewing
for free to the public. Initially, we will not have any resources  except word of
mouth  to actively advertise the website, and so we anticipate very little traffic
initially for our website. However, our website is up and operating properly already, and
GraphicPark.net, the website design and marketing firm we are using, has already submitted
our URL  http://www.tallyhoventures.com  to more than ten popular
search engines and web directories, including Google, HotBot, Lycos, Netscape Search as
well as DMOZ, which provides search results to many search engines such as Alta Vista and
AOL Search. This will allow the general public to become aware of our site through web
searches they conduct on their own into the areas with which our website deals, and we
anticipate that some growth in site traffic will occur through this means.

Although our website will have
available for viewing most of our products for free, and therefore not be
income-producing, our plan nevertheless calls for us to concentrate on increasing website
traffic. We view site traffic as a way to increase the positive word of mouth about our
products, thus hopefully getting the attention of executives of a film and/or television
distribution company or television network, who might offer us a professional production
opportunity, such as producing a television pilot or special, or short or feature-length
film, and it is the steady producing of television shows and films which is our ultimate
goal. For that reason, our business plan also calls for future funds  funds we
receive after this offering is completed  to be used to advertise on other websites
which might have a demographic that would appreciate our work, including off-beat
political me-zines, which are individualized web sites featuring a definite
personality such as andrewsullivan.com, or other off-beat humor websites such as
bobanddavid.com or atomfilms.com.

8

The second way we intend to market
and distribute our products is to distribute recordings of our films via VHS tape and/or
DVD to members of the entertainment community. For example, Managements first
entertainment product is a short film entitled: The G! True Tinseltown Tale: Dude,
Wheres My Car? This short film is a parody of both the television series
The E! True Hollywood Story as well as the 2000 film Dude, Wheres
My Car?" released by Twentieth Century Fox. All photography of the short film was
completed in January of 2003 and is now near completion of post-production. As mentioned
above, we intend to market this product after post-production is completed by uploading it
onto the tallyhoventures.com website. However, we will also send VHS and/or DVD copies of
the film to the subjects that were parodied in the film as a way of enhancing recognition
of the film.

This second marketing and
distribution method also dovetails with our first marketing and distribution method, the
website, because at the end of the tape containing the parody, the audience watching the
parody will be directed to our website for more free entertainment products. Future filmed
parodies produced by Management will likely be distributed in a similar fashion.

Although unusual, this marketing
maneuver of distributing tapes to members of the entertainment community as a way of
increasing exposure for ones work is not without precedent. The president of our
company, Tal Kapelner, recalls when he was a writers assistant and assistant to an
executive producer on a network television sitcom in 1997-1998. During that time, VHS
recordings containing bootleg copies, which are copies produced without the express
permission of its authors of a 10-minute video cartoon produced as a video Christmas
Card were circulating throughout the entertainment industry. Tal Kapelner himself
was shown a bootleg copy of this 10-minute video Christmas card in the offices of one of
the producers of the television sitcom he was working on at the time. He recalls that it
wasnt long after that time that the creators of this video Christmas card  who
had done no prior work in the entertainment industry  were offered their own show on
Comedy Central, a basic cable television channel jointly owned by AOL Time Warner and
Viacom. The show was entitled South Park.

According to Indiana University
Southeasts newspaper The Horizon and internet-based South Park
chronicler Scott Hemmings, the story of how the television show South Park
came about begins with the producers Matt Stone and Trey Parker, who met while attending
college in Colorado. They worked together in making film shorts for school, one of which
was a short film about 4 foul-mouthed boys trying to kill Frosty the Snowman. The video
was sent unsolicited to an executive at News Corps 20th Century Fox, who
enjoyed it and offered Parker and Stone $2000 to make a video Christmas card. Stone and
Parker took the idea from the Frosty skit they had done and improved the
animation a little. The finished product turned out to be the 10-minute video Christmas
card, entitled The Spirit of Christmas, wherein the 4 foul-mouthed boys were
involved in a fight between Santa Claus and Jesus. They gave it to the Fox executive, who
enjoyed it so much that he sent it out to his friends, who then sent it to others, and so
on until actor George Clooney got a hold of a copy. He watched it and liked it so much he
sent out between 300 and 700 copies  accounts vary as to the exact number  to
many people he knew, many of them in the entertainment industry. This distribution is
widely credited as responsible for Messrs. Parker and Stone having been offered a deal to
produce the sit-com cartoon South Park.

We envision our film and video
entertainment products, at least initially, to be distributed in a similar
underground fashion. We believe that sending our film and video parodies to
the subjects of the parodies themselves is a clever way to have our products seen, and we
hope that our products will be enjoyed by those to whom we send them, and distributed in
the same underground, guerilla fashion as the original video Christmas card
produced by Trey Parker and Matt Stone, with bootleg copies of our products being made by
those who view it, eventually gaining greater recognition in the entertainment industry
and perhaps eventually funding for future entertainment products, including television
series and specials, short and feature-length films and internet-based films.

9

The third way in which we anticipate
marketing and distributing our filmed entertainment products is to simply submit DVD
copies of our film and video products to those satellite, cable and broadcast entities who
air such products. For example, a DVD copy of our first short film parody, The G!
True Tinseltown Tale: Dude, Wheres My Car? may be submitted to HBO and/or
Cinemax, both owned by AOL Time Warner; Showtime and/or The Movie Channel, both owned by
Viacom; IFC, Independent Film Channel  owned jointly by Cablevision, General
Electric and MGM; and the Sundance channel, a joint venture between Viacom, PolyGram and
Robert Redford. All of these cable and satellite channels air short films regularly and
might be willing to at least look at unsolicited submissions to see if they would like to
air them, although we have no personal knowledge that it is that easy. Please see Risk
Factors, above. It is true, however, that Alexandra Pelosi, the producer and director of
the feature-length documentary Journeys With George  a documentary
featuring an intimate look at President George W. Bush as he campaigned for President in
the year 2000  did nothing more than submit her final edit of Journeys With
George to HBO with a handwritten note asking them to air it, and HBO executives
watched it, liked it and did, indeed, air it. We will try this plan and hope that
something similar to what transpired for Journeys With George occurs for one
of our film products, although it should be noted that Alexandra Pelosi is the daughter of
a high-ranking member of Congress, an advantage we do not share, and the subject matter of
Ms. Pelosis documentary is likely of more interest to a wider audience than any of
our products will be.

The fourth manner by which we intend
to market and distribute our film and video products is by submitting them as entries in
various film festivals and competitions across the continent. The largest and most famous
film festivals, which often include competitions of the films they exhibit, in North
America include Sundance and Slamdance, both in Park City, Utah, Telluride in Telluride,
Colorado and the Toronto International Film Festival in Toronto, Ontario. Given the
asymmetric amount of supply of films to the slots allowed in these festivals, we believe
it is not realistic that our films will be shown at any of these most famous film
festivals, although we will certainly try to submit our films as entrants into them,
beginning with our first film parody The G! True Hollywood Story: Dude, Wheres
My Car? which is currently in post-production. More realistic, we feel, is
successfully entering our films in smaller film festivals, including Toronto Giggleshorts
Comedy Film Festival and World of Comedy International Film Festival, both held in
Toronto, Ontario; Firstglance Los Angeles Film Festival in Los Angeles; and the Anchorage
Film Festival in Anchorage, Alaska. Exhibiting any of our film products at film festivals
increases the exposure our work receives, increasing the chance that an executive of a
film and/or television distribution company or television network might see our work, and
then might help us achieve our goals by offering us a professional production opportunity,
such as producing a television pilot or special, or short or feature-length film.

The plan for growth.
Ultimately, we plan for a network to approve of one of our TV pilots and pay us money to
produce more episodes of that concept. We also plan ultimately for a movie studio
executive to view one of our short films and finance a future feature film. Once we begin
to generate fees from the production of films and sees profits being derived from the
release of completed films, which we believe may occur within the next 1-3 years, we are
confident that we will be able to meet our minimum operating requirements. We then
anticipate having funds available for the needs of our development, making it possible to
expand in both quality and quantity. Please see Managements Discussion and Analysis
or Plan of Operation below.

10

Competition.    
          First, as a general note, competition in this industry, particularly in the
          low-budget, independent film production niche of the industry, is extremely
          intense. Major film studios such as Warner Bros. and Sony Corps
          Columbia-Tri Star dominate the industry; mini-major film studios
          such as Miramax and New Line Cinema compete fiercely to produce and/or
          distribute low- and mid-budgeted films; smaller independent production companies
          such as Shooting Gallery Films, Vivendi Universals October Films,
          Lions Gate Films and Regent Entertainment are well-established and use
          their recognition and track record as leverage to compete favorably for
          financing and other resources used to make films; and there are literally
          hundreds of web-based producers of films  with varied levels of quality
           virtually all of which compete for recognition, attention and,
          ultimately, financing for future productions, in this crowded marketplace.

Initially, in order to make the
business, marketing and distribution plans we described above work, we need to have our
entertainment products competitive in three places: 1) at film festivals, 2) on the
Internet, and 3) within the actual offices of members of the entertainment community. And
business conditions in all three places are extremely competitive.

First, at film festivals, our work
will be submitted to the various film festivals across the continent, and then, prior to
each festival, judged against thousands of other short film submissions. If our work is
selected by the respective festivals judging panel, our work then is exhibited at
the festival along with one hundred or more other films, all presumably of similar
quality. These conditions combine to create a very poor business environment for our work,
in that the likelihood of being offered professional production opportunities as a result
solely of these exhibitions is small.

Second, on the Internet, there is an
overwhelming supply of entertainment products, including short- and feature-length films
and videos, and entertaining written material such as essays, screenplays, teleplays,
columns, short stories, etc., and most of the suppliers of these entertainment products
are actively trying to get their products seen by the broad public, and many want to be
offered paid jobs in the entertainment industry to write, direct, produce or act in
television, music videos and/or film projects, which is similar to our plan.

With the advent of the Internet, the
amateur entertainment suppliers have multiplied geometrically. There are literally
thousands upon thousands of websites such as ours which feature the creative and artistic
work of one or more people in the fields of film, video and creative writing. Websites
which make available entertainment products similar to ours include atomfilms.com,
kinemafilms.com, shockwave.com, pitch-prods.com, cyanpictures.com, paperbarkfilms.com, and
alldaybreakfast.ca. These websites containing entertainment products similar to ours
 and many thousands more  are virtually all more established than we are, and
carry more material than we do currently, and are more well-known than our website is.

Getting ones product noticed on
the Internet in this environment of overwhelming supply is extremely difficult. And with
only a website which so far contains little content, and only one short film in
post-production which cannot be uploaded onto our site until it is finished, and almost no
promotion of the site, our competitive position in this industry is very weak currently.

The third area in which we need our
products to be competitive initially is within the actual work offices of the members of
the entertainment community. As we described above, our plan calls for sending copies of
our products to the very people and/or entities we make fun of in our parodies. This is
because the number of submissions  both solicited and unsolicited  which
members of the entertainment community receive is huge. Often agents, producers, studio
heads and others involved in programming in the entertainment industry will receive
hundreds of submissions every month, including script submissions, video submissions and
so on. Even with our unusual marketing and distribution method, we face a daunting uphill
battle to get our work noticed. And with our relatively unknown status, our competitive
position in this arena is, again, very weak.

11

Our position is further weakened
because price is not a method of competition in this segment of the industry. Virtually no
low-budget web-based supplier of entertainment products charges for their products, making
it impossible to undercut the competition through price. And of course no
supplier charges members of the entertainment industry a fee when they send submissions
because suppliers are often desperate for members of the entertainment industry to view
their work. Quality of product is certainly a method of competition; however, there, too,
the sheer amount of entertainment products available make it close to impossible to
rise above the rest in terms of quality.

Another competitive method is
who you know, meaning that any personal and/or business relationships
cultivated with members of the entertainment community by each supplier are utilized to
get the respective suppliers work seen by those members of the entertainment
community. Here again, although our president and Chairman worked for one season as a
writers assistant and assistant to the executive producer on a sitcom which aired on
the WB Network, and our vice-president and secretary has worked as both a personal and
business assistant for several celebrities in the past, we nevertheless cannot say that we
are in a competitive advantage in this method of competition. Our contacts in
the entertainment industry do not go deep and wide, and while we certainly will try to
utilize whatever relationships with members of the entertainment community we have to our
advantage, we cannot say that we are in a necessarily more competitive position in this
method of competition than other suppliers, many of whom are more closely associated with
the entertainment industry.

Finally, if we were to be successful
to the point where we would be asked to be the production company of any kind of
television programming or film of any length, our competition would be significantly
broadened to include some of the largest and most well-established multi-national
corporations in the world, including Walt Disney Company, Sony Corp., Viacom, News Corp.
and AOL Time Warner. Please see Risk Factors above.

Dependence On a Few Major
Customers. Although now with the Internet there are literally almost an infinite
number of ways one may show ones entertainment products to the public, there are
still, nevertheless, only a very few ways to show ones entertainment product to the
public in exchange for money. Theres broadcast network programming, which includes
NBC, CBS, ABC, FOX, WB and UPN, and several basic cable network channels which
have original entertainment programming, including USA Network, Comedy Central, Lifetime,
E! Entertainment Television, the PAX network, ABC Family, and MTV Networks. Theres
also a limited amount of original programming funded by premium pay cable outlets,
including HBO, Showtime, Cinemax and Encore! But there are not many other venues for
exhibiting ones work for money, and this huge amount of supply, combined with
relatively few customers for the supply, creates a bottleneck effect for
entertainment products, where there is a great deal of competition among suppliers of
entertainment content, such as Tally-Ho, and outlets which air them, such as broadcast,
basic cable and premium cable channels. Please see Risk Factors above.

Right now we have no customers, and
we anticipate no customers for the near future. If our business plan was quite successful,
then in the foreseeable future we would likely be reliant on the very few customers
delineated above for all of our work.

12

Intellectual Property and Labor
Agreements. Our success and ability to compete will be dependent in part upon our
ability to obtain and maintain protection for our current and future literary properties,
to defend our intellectual property rights and to operate without infringing on the
proprietary rights of others. While we will attempt to rely, as needed, on a combination
of copyrights and trademarks to establish and protect our intellectual property rights
 including use of the U.S. Patent and Trademark Offices Form PA and the
Writers Guild of Americas Intellectual Property Registry  we believe that
factors such as the technical and creative skills of our personnel are more essential to
our success and ability to compete. The Form PA, published by the U.S. Patent and
Trademark Office in Washington, D.C., allows the filer to register with the USPTO their
creative recorded work, such as a film and the underlying script for the film. Although
registration with the Copyright Office is not required to have a valid copyright,
registration does provide several benefits, including the establishment of a public record
and evidence of our claim as the valid copyright owner of our films and their underlying
scripts, the ability to file a federal lawsuit against someone who uses our films or
portions thereof without our permission, and eligibility to receive statutory damages and
attorneys fees in the event we file and win a copyright infringement lawsuit. The
Writers Guild of Americas Intellectual Property Registry service assists
writers in establishing the completion dates of intellectual property, providing a dated
record documenting a writers claim of authorship. If necessary, a Registry employee
may produce the material as evidence if a legal or official Guild action is initiated.

Despite use of the federal Form PA
and the Writers Guilds Intellectual Property Registry, there can be no assurance
that any of our intellectual property rights will provide competitive advantages or will
not be challenged, invalidated or circumvented by competitors. There can be no assurance
that disputes will not arise concerning the ownership of intellectual property.
Furthermore, there can be no assurance that intellectual properties will not become known
or be independently developed by competitors or that we will be able to maintain the
confidentiality of information relating to our literary properties.

Conversely, content on our website
may bring us liability. Our website could possibly face potential liability for
negligence, copyright, patent, trademark, defamation, indecency and other claims based on
the nature and content of the materials we post. Such claims have been brought and
sometimes successfully pressed against Internet content distributors. We could also be
exposed to liability with respect to unauthorized duplication of content or unauthorized
use of other parties proprietary technology. Although we intend to obtain general
liability insurance, it may not cover potential claims of this type or may not be adequate
to protect us from all liability that may be imposed. Therefore any imposition of
liability could hurt our business. Please see Risk Factors above.

The only labor contract we have
currently is the Experimental Film Agreement with the Screen Actors Guild, which is
attached as an Exhibit. This contract discusses the rules involved with hiring, paying and
working with the actors we use on our film and television shoots. We do not believe this
agreement with SAG will negatively affect our business, as it specifically stipulates that
we have the right as Producers to negotiate pay directly with the performers we wish to
hire, rather than be bound by SAGs normal minimum pay structure. There are, however,
other rules we are bound by because of this Agreement with SAG, including actors
pension and health contributions, which we feel do increase our costs somewhat. However,
importantly, our Experimental Film Agreement with SAG allows us to hire non-SAG actors as
well, greatly broadening our ability to search for the best and most cost-effective talent
for our productions.

13

Existing or Probable Governmental
Regulation There are the usual governmental regulations on workplace environment and
employee pay, benefits, taxes and relations that other businesses face, as well as
intellectual property considerations, discussed above; however, we do not anticipate any
other governmental regulations to substantially effect our business.

Employees.    
          The total number of employees we have, including full- and part-time, is
          currently zero (0). We rely on the services of our President and Chairman, Tal
          Kapelner, our Vice-President, Secretary and Director, Cheney Shapiro, and our
          Treasurer, Ariella Kapelner, to devote as much time as they can to Tally-Ho and
          its projects, and to spend time overseeing our administrative responsibilities
          as well, but at this time we have no employees, not even our three management
          personnel. Currently, Tal Kapelner devotes 20 hours per week to Tally-Ho, Cheney
          Shapiro devotes 15 hours per week to Tally-Ho and Ariella Kapelner devotes 5
          hours per week, on average, to Tally-Ho. We anticipate that our officers will
          continue to devote the same number of hours, on average, per week to our company
          in the foreseeable future, although there will naturally be a spike in the
          number of hours per week devoted by our management team whenever we go into
          production on a short film, web-exclusive video skit or vignette or television
          pilot. In the event we are successful in generating revenue and making our
          company profitable, employment contracts will be offered to members of our
          management personnel, and if in the mid-future, 1-3 years from now, we are
          successful enough to have the resources for and need to hire additional
          management or administrative or other personnel, we will do so.

With respect to our filmed
entertainment products, those are worked on by independent contractors who work on each
shoot on a project basis. For example, a director of photography and a script supervisor
were retained for The G! True Tinseltown Tale: Dude, Wheres My Car? and
then paid by the shoot day as independent contractors. Currently the film is in
post-production getting edited by an editor who is paid by the hour and is also not an
employee. The only exception to this are the actors. Pursuant to the contract we signed
with the Screen Actors Guild, we are required to consider the actors we hire on each film
employees, even if they are hired for only one day. However, the typical length of
employment for actors on a short film shoot is 1-2 days, such as it was with The G!
True Tinseltown Tale: Dude, Wheres My Car?". This is typical of our industry
and we will likely continue to produce film entertainment products without hiring
employees, except for the actors on very short-term bases.

# Item 2. Description of
Property.

We are provided free office and small
studio space at 518 Oak Street #2 in Glendale, California at no charge by our president
and Chairman, Tal Kapelner.

Currently, and for the foreseeable
future, which we consider to be over the next 12 months, it is our policy to not engage in
any investments in real estate or interests in real estate, or any investments in real
estate mortgages, or any securities of or interests in persons primarily engaged in real
estate activity; however, we do not have in place specific, written limitations on the
percentage of assets which may be invested in any one investment, or type of investment.
This policy we have described may be changed without a vote of our security holders.
Currently, it is not our policy to acquire assets either primarily for possible capital
gain or primarily for income.

# Item 3. Legal
Proceedings.

We are not a party to any pending
legal proceeding, nor are we aware of any proceeding contemplated by any governmental
authority.

14

# PART II

# Item 5. Market for
Common Equity and Related Stockholder Matters.

| | Use
of proceeds from our registered stock offering. On November 7, 2003, the U.S. Securities
and Exchange Commission declared our registered stock offering pursuant to Section 5 of
the Securities Act of 1933 effective. The Commission assigned our registration statement
File No. 333-104631.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
offering commenced immediately on November 7, 2003, with an offering date of November 7,
2003. The offering terminated on January 1, 2004, after the sale of 1,065,875 shares, well
before we sold all 25,000,000 shares being offered.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
title of the class of equity that was registered and offered is Common Stock, $0.001 par
value. We registered 25,000,000 shares at a price of $0.01 per share, for an aggregate
amount of $250,000 worth of shares registered. We sold 1,065,875 shares, for an aggregate
amount of $10,659 raised.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | From
the effective date of our registration statement on November 7, 2003, to the ending date
of our reproting period on December 31, 2003, we reasonably estimate that we incurred
approximately $300 of expenses in the issuance and distribution of the securities
registered, all related to printing and engraving and postal costs. No costs were incurred
for underwriting discounts or commissions, finders fees, or expenses paid to or for
underwriters. There were no finders or underwriters. No direct or indirect payments were
made to any directors, officers, promoters of the issuer or their associates; nor to any
persons owning 10 percent or more of any class of the issuers equity, nor to any
affiliates of the issuer; nor to any other person.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The
net offering proceeds to the issuer after deducting the $300 in expenses is $10,359.

| | From
the effective date of our registration statement on November 7, 2003, to the ending date
of our reproting period on December 31, 2003, no amount of net offering proceeds to the
issuer were used for construction of plant, building and facilities; purchase and
installation of machinery and equipment; purchases of real estate; acquisition of other
business(es); or repayment of indebtedness. $497 was used for working capital and $925 was
used for accounting expenses. No payments were direct or indirect payments to directors,
officers, general partners or promoters of the issuer or their associates; to persons
owning ten (10) percent or more of any class of equity securities of the issuer; and to
affiliates of the issuer; or direct or indirect payments to others.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Item 6.
Managements Discussion and Analysis or Plan of Operation.

FORWARD-LOOKING STATEMENTS

This report contains
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. These statements
relate to future events or the Companys future financial performance. The Company
intends the forward-looking statements throughout this quarterly report and the
information incorporated by reference to be covered by the safe harbor provisions for
forward-looking statements. All projections and statements regarding the Companys
expected financial position and operating results, its business strategy, its financing
plans and the outcome of any contingencies are forward-looking statements. These
statements can sometimes be identified by the use of forward-looking words such as
may, believe, plan, will,
anticipate, estimate, expect, intend, and
other words and phrases of similar meaning. Known and unknown risks, uncertainties and
other factors could cause the actual results to differ materially from those contemplated
by the statements. The forward-looking information is based on information available as of
the date of this report on Form 10-KSB and on numerous assumptions and developments that
are not within our control. Although the Company believes these forward-looking statements
are reasonable, the Company cannot assure you they will turn out to be correct.

15

The amount of cash we currently have
on hand, as of February 29, 2004, is $385, and the amount of working capital we have
 which is current assets minus current liabilities  is $(4,434). As of the end
of our last quarter, on December 31, 2003, we had $6,268 cash on hand. The amount of cash
we will need to operate our business over the next 12 months is $10,200. The amount of
cash we have on hand is insufficient to satisfy our cash requirements for any time period,
even one month. Without an infusion of cash from the offering, Tal Kapelner and Cheney
Shapiro will have to continue to loan us money to pay our expenses. For example, Mr.
Kapelner and Ms. Shapiro have already loaned us the $1,800 we needed to pay the
accountants for our 2002 year-end audit, the $1,200 we needed to pay our accountants for
unaudited interim financials, the $1,300 we needed to pay the EDGARizer costs thus far,
and the $252 we needed to pay the state of California its Blue Sky fee.

In the fourth quarter of 2003, we
began our second major project, a television pilot for a new original series entitled
The Boiler Twins. Through that project, we were able to land the Screen Actors
Guild contract which legitimized us as an official registered signatory producer to the
Screen Actors Guild (SAG), giving us the right to hire any actor of any prominence for any
future project. Additionally, work on any of our projects qualifies a non-union actor to
join the SAG union. We look forward to completing and marketing the Boiler
Twins project as part of our future plans for this year (see our Marketing Plans,
below).

Also, since our registered stock
offering in 2003, we have been very active in lining up contracts with key creative
below-the-line talent, including contracts with music scoring and editing
companies, as well as a consulting contract with well-known director and producer Eric
Shermans company Film Transform, Inc. (Eric Sherman CV attached to Consulting
Contract in Section 6.)

We have also landed an important
co-production and development deal with Jayson Diola. It gives us exclusive right to
produce his television pilot, subject to raising $10,000 over the next six months. We
believe that this will give us the exposure in the industry to enhance our marketing plan
and launch many of our entertainment products.

We also have signed a contract with
Viscount Productions, Ltd., a company which provides filming services to non-entertainment
companies who wish to produce their own educational or documentary videos or series.
Viscount subcontracts the filming work to us. The contract begins in mid-May of 2004, and
we are confident that this will allow us to begin business operations, begin a cash flow
and start enjoying profits, which should allow us to raise some of the money we need for
at least our smaller-scale projects we contemplate doing over the next 12 months.

Over the next 12 months, we plan to
produce a minimum of 1 television pilot, 7 super-short (under ten minutes long) films and
7 short films (10-40 minutes long). Based upon our experience, we anticipate each of these
products to have a completion timeframe of 2-4 months each, from pre-production to
post-production.

16

There are specific milestones 
and steps to achieving each milestone  to our business plan. Our first milestone was
to establish our business. The specific steps we took to accomplish this were

a)
          incorporate our corporation; b) establish our web site; c) establish our
          offices; d) open a bank account; e) perfect our business plan.

This first milestone was reached in
approximately three months, from November 2002 to January 2003 and cost us approximately
$1,000. Tal Kapelner and Cheney Shapiro loaned Tally-Ho the money needed to complete this
milestone.

The second milestone was to produce
and market our first entertainment product: a short film shot on digital video entitled
The G! True Tinseltown Tale: Dude, Wheres My Car? The specific steps we
took to accomplish this were

a)
          write a script; b) decide on a director and producers; c) develop a budget and
          production schedule; d) finance the project; e) prepare paperwork for, and sign
          with, actors union; f) sign with payroll company and prepare employer tax and
          workers compensation obligations; g) cast all roles; h) find and secure
          locations for shooting; i) hire all needed crewmembers;j) purchase or otherwise
          secure props, wardrobe and filmmaking equipment; k) rehearse the scenes with the
          actors; l) prepare food and beverage service for locations and make other
          preparations before shooting; m) shoot the scenes of the film as per the script;
          n) complete final tax and union paperwork; and o) hire editor to catalogue all
          of the footage shot.

These steps have taken approximately
4 months to complete, from November 2002 to February 2003, have cost approximately $4,000
and have been financed by Tal Kapelner through loans. The specific steps we still are
taking to accomplish this milestone are

p)
          have director, producers and editor work together to cut the footage together
          into a final film, adding any visual or sound effects, additional dialogue
          recording, narration, additional footage, etc.; q) produce copies of the
          finished film in whichever media is deemed suitable; and r) distribute and
          market the finished product through the various methods discussed above in the
          section Business of Issuer.

These last two steps to completing
this milestone have taken over one year so far, from March 2003 to present, and are likely
to take an additional four months to complete. The cost of these two additional steps is
likely to be approximately $3,000 and Tal Kapelner will be financing this money through
loans.

17

The third milestone was to produce
our second entertainment product: written material for the Tally-Ho Ventures, Inc.
website. The specific steps we took to accomplish this were
 a) Tal Kapelner writing the
material; b) our web designer Steve Aguilera of GraphicPark.net uploading and formatting
the material for our web site. This third milestone was reached in approximately 2 weeks,
in March of 2003, and did not cost any additional money.

The fourth milestone was to raise
financial capital and prepare our share structure so as to allow for listing later on a
secondary market by issuing freely-tradable securities. The specific steps we took to
accomplish this were

a)
          retain counsel, auditor and EDGARizer professionals; b) prepare Form SB-2 and
          file with SEC; c) file registration statement with state of California pursuant
          to qualification by coordination provision; d) have SEC review and offer
          comments; e) revise SB-2 and re-file with SEC; f) have SEC re-review and offer
          further comments; g) continue to revise until cleared for offering by SEC; h)
          conduct offering in the state of California, retain transfer agent, issue share
          certificates, etc.

We have begun these steps in March of
2003 and completed this milestone on January 1, 2004, when our registered stock offering
closed. This milestone has cost us approximately $6,500 in EDGARizing and accounting fees;
printing, engraving and mailing costs; and states of California and Colorado registration
fees, and some of that money was loaned to us by Tal Kapelner and Cheney Shapiro and the
rest was taken from sales in the offering.

Our fifth milestone is to prepare our
next entertainment product: a web-exclusive video vignette featuring two sets of teams,
each with their own car, attempting to garner the most number of parking tickets in one
day in the Greater Los Angeles Area. The specific steps we will need to take to accomplish
this milestone is

a)
          complete a treatment and detailed outline of the vignette; b) decide on a
          director and producers; c) develop a budget and production schedule; d) finance
          the project; e) prepare paperwork for, and sign with, actors union; f) sign with
          payroll company and prepare employer tax and workers compensation
          obligations; g) decide on who will participate in the vignette, cast any roles
          as needed; h) hire all needed crewmembers; i) purchase or otherwise secure
          props, wardrobe and filmmaking equipment; j) shoot the action of each of the two
          teams as they wander around L.A. in search of parking enforcement officers to
          ticket their cars; k) complete final tax and union paperwork; l) hire editor to
          catalogue all of the footage shot; m) have director, producers and editor work
          together to cut the footage together into a final vignette, adding any visual or
          sound effects, additional dialogue recording, narration, additional footage,
          etc.; and n) upload finished vignette to website.

The timeframe for completing this
milestone depends upon how quickly we can achieve financing; however, we anticipate
starting this project in November 2004 and uploading the finished product in December
2004. We project a cost of $5,000 for this project from start to finish, and anticipate
paying for this project through future loans or future money raises.

18

The sixth milestone in our business
plan is to produce and market a television show pilot episode, which we have designed to
be a behind-the-scenes reality-based television show which will feature edited
footage of three writing partners coming together at a table to write a comedy sketch of
their choosing. The first two-thirds of the show will contain this footage showing the
writers attempting to put funny material down on paper in the form of a five-minute comedy
skit. The final 5-10 minutes of the program will feature professional actors actually
performing the skit the writers just completed writing, as well as bonus behind-the-scenes
footage showing the actors first reading their lines and rehearsing. The specific steps
for completing this milestone will be

a)
write a detailed treatment and outline of the action in the episode; 
b) decide on a director and producers;
c) develop a budget and production schedule;
d) finance the project;
e) prepare paperwork for, and sign with, actors union; 
f) sign with payroll company and prepare employer tax and workers compensation obligations; 
g) cast all roles; 
h) find and secure studio sets for shooting; 
i) hire all needed crewmembers; 
j) purchase or otherwise secure props, wardrobe and filmmaking equipment; 
k) prepare food and beverage service for the cast and crew on set and make other preparations before shooting; 
l) shoot the documentary footage of the three writers writing a skit together;
m) shoot documentary footage of actors receiving the material the writers just wrote, rehearsing and then performing the skit;
n) complete final tax and union paperwork; 
o) hire editor to catalogue all of the footage shot; 
p) have director, producers and editor work together to cut the footage together into a
final film, adding any visual or sound effects, additional dialogue recording,
narration, additional footage, etc.; 
q) produce copies of the finished film in whichever media is deemed suitable; and 
r) distribute and market the finished product through the various methods discussed above in the section Business of
          Issuer.

The timeframe for completing this
milestone, depending upon availability of funds following this offering, is expected to be
five months from writing the treatment to marketing and distributing the finished pilot.
We anticipate working on this project from December of 2004 to the end of May 2005, and
spending $40,000 to produce and market it, with the money coming from the proceeds of this
offering.

The seventh milestone in our business
plan is to apply for a priced quotation on the Over-The-Counter Bulletin Board stock
quotation service. The specific steps we will need to take to complete this milestone are

a)
          close our stock offering pursuant to this registration statement; b) prepare due
          diligence paperwork to supplement our 15c2-11 filing; c) submit our due
          diligence materials to the NASD via a market maker; d) respond to any
          deficiencies in our application as pointed out by the NASD; e) upon approval for
          an unpriced quotation by the NASD, have market maker revise Form 211 to apply
          for a priced quotation on the Over-The-Counter Bulletin Board; and f) work with
          market maker on setting an opening price and discuss making market on the stock.

19

The timeframe for completing this
milestone is expected to be three months, from December 2003 to June 2004. There is no
cost for applying for a priced quotation on the OTC Bulletin Board stock quotation
service. Related accounting costs, however, are expected to be approximately $1,100 more
than what was already paid, and are expected to be paid from the proceeds of this offering
and loans from management.

In addition to the above-mentioned
creative projects, we have many ideas in development for our short and super short films,
including a spoof of Viacoms basic cable channel MTV, tentatively titled 20
Things You Wont See on MTV (Like Dignity)"; a parody of the television series
Inside the Actors Studio; a parody of the Carls Jr. fast-food
restaurant commercials; and a dramatic short film about the field of psychiatrys
influence in the loss of individual liberty and freedom in the U.S.

We also plan to step up our marketing
efforts, subject to available financing, of both our company as a whole as well as our
indidividual projects. We look forward to more screenings of our first short film,
The G! True Tinseltown Tale: Dude, Wheres My Car?", as well as
distributing DVD and/or VHS copies of the film to key entertainment industry players, as
we detail in our prospectus. We also plan to distribute copies of our television pilot
The Boiler Twins in the hopes of gaining sufficient interest from television
programmers. To publicize our company as a whole, and drive viewers to our website, we may
place some of our written works  currently available through our website
www.tallyhoventures.com  in the form of an ad placed in entertainment
industry trade publications like Hollywood Reporter and Variety, and we may also advertise
on-line in certain websites we feel may garner the greatest amount of exposure to our
target demographic. Our marketing strategy in this area is to advertise
counter-intuitively on sites that are not particularly known for their entertainment
industry content, and are not widely advertised on at all, such as political weblogs like
andrewsullivan.com and instapundit.com, thereby reaching a powerful and affluent
demographic without much competition from other advertisers, in particular those from the
entertainment industry.

We have no purchases or sales of
plant and/or significant equipment planned in the next 12 months.

We do not anticipate any significant
changes in the number of employees. We currently have zero and anticipate having zero
employees in the next 12 months.

# Item 7. Financial
Statements.

|                                               | 
|---------------------------------------------- | 
|                                               | 
|Independent Auditors' Report                   | 
|Financial Statements:                          | 
|Balance Sheet as of December 31, 2003          | 
|Statement of Operations for the years ended    | 
|Ended December 31, 2003 and 2002               | 
|Statement of Stockholders' Deficiency          | 
|for the years ended December 31, 2003 and 2002 | 
|Statement of Cash Flows for the years ended    | 
|Ended December 31, 2003 and 2002               | 
|Notes to Financial Statements                  | 

20

INDEPENDENT AUDITORS
REPORT

To
the Board of DirectorsTally-Ho Ventures, Inc.(A Development Stage Company)Glendale,
California

We have audited the accompanying
balance sheet of Tally-Ho Ventures, Inc. as of December 31, 2002, and the related
statements of expenses, stockholders deficit, and cash flows for the period from
November 21, 2002 (Inception) through December 31, 2002. These financial statements are
the responsibility of Tally-Hos management. Our responsibility is to express an
opinion on these financial statements based on our audit.

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

In our opinion, the financial
statements referred to above present fairly, in all material respects, the financial
position of Tally-Ho Ventures, Inc., as of December 31, 2002, and the results of its
operations and its cash flows for the period described in conformity with accounting
principles generally accepted in the United States of America.

MALONE & BAILEY, PLLCwww.malone-bailey.com Houston, Texas

March 10, 2004

F-1

TALLY-HO VENTURES, INC.(A Development Stage
Company)BALANCE SHEET December 31, 2003

|ASSETS                                               |  |  |   |         |  
|---------------------------------------------------- |  |  | - | ------- | -
|Current Assets                                       |  | 
|Cash                                                 |  |  | $ | 6,268   |  
|                                                     | 
|LIABILITIES AND STOCKHOLDERS' DEFICIT                |  | 
|LIABILITIES                                          |  | 
|Current Liabilities                                  |  | 
|Accounts Payable                                     |  |  | $ | 310     |  
|Notes payable to shareholders                        |  |  |   | 7,415   |  
|                                                     | 
|Total Current Liabilities                            |  |  |   | 7,725   |  
|                                                     | 
|STOCKHOLDERS' DEFICIT                                |  | 
|Common stock, $.001 par, 75,000,000 shares           |  | 
|authorized, 44,215,875 shares issued and outstanding |  |  |   | 44,216  |  
|Additional paid in capital                           |  |  |   | 31,035  |  
|Deficit accumulated during the development stage     |  |  |   | (76,708 | )
|                                                     | 
|Total Stockholders' Deficit                          |  |  |   | (1,457  | )
|                                                     | 
|Total Liabilities & Stockholders' Deficit            |  |  | $ | 6,268   |  
|                                                     | 

See
accompanying summary of accounting policies and notes to financial statements.

F-2

TALLY-HO VENTURES, INC.(A Development Stage
Company) STATEMENTS OF EXPENSES 
Year ended December 31, 2003, Period from November 21, 2002 (Inception) Through December 31,
2002,and Period from
November 21, 2002 (Inception) Through December 31,
2003

|                                           | 2003 | 2002 | Inception
Through
2003
|------------------------------------------ | ---- | ---- | ----------------------
|Administrative expenses                    |      |      |                       
|- paid in cash                             |      |      | $                     
|- paid in stock                            |      |      |                       
|- imputed interest                         |      |      |                       
|                                           |      |      |                       
|Net loss                                   |      |      | $                     
|                                           |      |      |                       
|Basic and diluted loss per common share    |      |      | $                     
|Weighted average common shares outstanding |      |      |                       

See
accompanying summary of accounting policies and notes to financial statements.

F-3

TALLY-HO VENTURES, INC. (A Development Stage
Company) STATEMENT OF CHANGES IN
STOCKHOLDERS DEFICIT Period from November
21, 2002 (Inception) Through December 31,
2003

|                            | Common Stock
Shares            Amount | Deficit
Accumulated
During
Development
Stage | Totals
|--------------------------- | ------------------------------------- | -------------------------------------------- | ------
|Shares issued to founder    |                                       |                                              |       
|in November 2002 at         |                                       |                                             
|par $.001                   |                                       |                                              |       
|Shares issued for services  |                                       |                                             
|in November 2002 at         |                                       |                                             
|par $.001                   |                                       |                                              |       
|Shares canceled             |                                       |                                              |       
|Shares issued for services  |                                       |                                             
|in November 2002 at         |                                       |                                             
|par $.001                   |                                       |                                              |       
|Imputed interest on notes   |                                       |                                             
|payable to shareholders     |                                       |                                              |       
|Net Loss                    |                                       |                                              |       
|                            |                                       |                                              |       
|Subtotals                   |                                       |                                              |       
|Shares issued for services  |                                       |                                             
|in November 2003 at         |                                       |                                             
|par $.001                   |                                       |                                              |       
|Shares issued for cash      |                                       |                                             
|in 2003 at par $.001        |                                       |                                              |       
|Imputed interest on notes   |                                       |                                             
|payable to shareholders     |                                       |                                              |       
|Net loss                    |                                       |                                              |       
|                            |                                       |                                              |       
|Balances, December 31, 2003 |                                       |                                              |       
|                            |                                       |                                              |       
|Less:  par value            |                                       |                                              |       
|                            |                                       |                                              |       
|Paid in capital             |                                       |                                              |       
|                            |                                       |                                              |       

See
accompanying summary of accounting policies and notes to financial statements.

F-4

TALLY-HO VENTURES, INC. (A Development Stage
Company) STATEMENTS OF CASH FLOWS 
Year ended December 31, 2003, Period from November 21, 2002 (Inception) Through December 31,
2002,and Period from November 21, 2002 (Inception) Through December 31,
2003

|                                          | 2003 | 2002 | Inception
Through
2003
|----------------------------------------- | ---- | ---- | ----------------------
|CASH FLOWS FROM OPERATING ACTIVITIES      |      |      |                       
|Net loss                                  |      |      | $                     
|Adjustments to reconcile net loss         |      |     
|to cash used in operating activities:     |      |     
|Stock issued to founders                  |      |      |                       
|Stock issued for services                 |      |      |                       
|Imputed interest on notes payable to      |      |     
|shareholders391                           |      |      |                       
|Changes in Accounts Payable               |      |      |                       
|                                          |      |      |                       
|NET CASH USED IN OPERATING ACTIVITIES     |      |      |                       
|                                          |      |      |                       
|CASH FLOWS FROM INVESTING ACTIVITIES      |      |     
|Loans to related party                    |      |      |                       
|Proceeds from repayment of loan to        |      |     
|related party                             |      |      |                       
|                                          |      |      |                       
|NET CASH PROVIDED BY INVESTING ACTIVITIES |      |      |                       
|                                          |      |      |                       
|CASH FLOWS FROM FINANCING ACTIVITIES      |      |     
|Proceeds from notes payable to            |      |     
|shareholders                              |      |      |                       
|Stock issued for cash                     |      |      |                       
|                                          |      |      |                       
|NET CASH PROVIDED BY FINANCING ACTIVITIES |      |      |                       
|NET CHANGE IN CASH                        |      |      |                       
|Cash balance, beginning                   |      |      |                       
|                                          |      |      |                       
|Cash balance, ending                      |      |      | $                     
|                                          |      |      |                       

See
accompanying summary of accounting policies and notes to financial statements.

F-5

TALLY-HO VENTURES, INC. (A Development Stage
Company)NOTES TO FINANCIAL
STATEMENTS

NOTE 1  SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES

Nature of Business.  Tally-Ho Ventures, Inc., was incorporated in Delaware on November 21, 2002 to produce films
and television programs.

Use of Estimates. In preparing
financial statements, management makes estimates and assumptions that affect the reported
amounts of assets and liabilities in the balance sheet and revenue and expenses in the
income statement. Actual results could differ from those estimates.

Cash and Cash Equivalents. For
purposes of the statement of cash flows, Tally-Ho considers all highly liquid investments
purchased with an original maturity of three months or less to be cash equivalents. There
were no cash equivalents as of December 31, 2003.

Revenue Recognition. Tally-Ho
recognizes revenue in accordance with Statement of Accounting Position 00-2
Accounting by Producers or Distributors of Films. Revenue is recognized from a
sale or licensing arrangement of a film when persuasive evidence of a sale or licensing
arrangement with a customer exists; the film is complete and, in accordance with the terms
of the arrangement, has been delivered or is available for immediate and unconditional
delivery; the license period of the arrangement has begun and the customer begins its
exploitation, exhibition or sale; the arrangement fee is fixed or determinable; and
collection of the arrangement fee is reasonably assured. There were no revenues as of
December 31, 2003.

Income taxes. Tally-Ho recognizes
deferred tax assets and liabilities based on differences between the financial reporting
and tax bases of assets and liabilities using the enacted tax rates and laws that are
expected to be in effect when the differences are expected to be recovered. Tally-Ho
provides a valuation allowance for deferred tax assets for which it does not consider
realization of such assets to be more likely than not.

Recently issued accounting
pronouncements. Tally-Ho does not expect the adoption of recently issued accounting
pronouncements to have a significant impact on their results of operations, financial
position or cash flow.

F-6

NOTE 2 FUNDING COMMITMENT

Tally-Ho has had no revenues and is
currently attempting to raise capital. However, current overhead and administrative costs
are minimal. The founder and majority shareholder has orally committed to fund ongoing
operations.

NOTE 3  NOTES
PAYABLE TO SHAREHOLDERS

In November and December 2002, the
majority shareholders loaned Tally-Ho $2,524. In 2003, the majority shareholders loaned
Tally-Ho $4,892. The notes mature 12 months from issuance, bear no interest and have no
collateral. Interest expense is being imputed at 8 percent and is recorded as paid in
capital. The notes from 2002 were in default as of December 31, 2003.

NOTE 4  COMMON STOCK

In November 2002, Tally-Hos
founder was issued 41,050,000 shares of common stock valued at par or $41,050.

In November 2002, Tally-Ho issued 2,100,000
shares of common stock valued at par or $2,100 for services rendered.

In November 2002, the founder
transferred 21,050,000 shares of his common stock to five individuals for services
performed for Tally-Ho. The shares were accounted for as canceled and reissued by Tally-Ho
for services. The shares were valued at $21,050 and have been expensed.

Tally-Ho sold 765,875 shares for
$7,659 to several individuals in November and December 2003. Tally-Ho issued 300,000
shares valued at $3,000 to a consultant in November 2003.

NOTE 5  INCOME TAXES

|Deferred tax assets       |  |  | $ | 10  |  
|------------------------- |  |  | - | --- | -
|Less: valuation allowance |  |  |   | (10 | )
|                          | 
|Net deferred taxes        |  |  | $ | 0   |  
|                          | 

Tally-Ho has a net operating loss of
approximately $75 at December 31, 2003 which expires in 2023.

NOTE 6  COMMITMENTS

Tally-Hos principal office is
in the home of Tally-Hos president pursuant to an oral agreement on a rent-free
month-to-month basis.

F-7

# Item 8A. Controls and
Procedures.

It is Managements
responsibility for establishing and maintaining adequate internal control over financial
reporting for Tally Ho. It is the Presidents and Treasurers ultimate
responsibility to ensure the Company maintains disclosure controls and procedures designed
to provide reasonable assurance that material information, both financial and
non-financial, and other information required under the securities laws to be disclosed is
identified and communicated to senior management on a timely basis. The Companys
disclosure controls and procedures include mandatory communication of material events,
management review of monthly, quarterly and annual results and an established system of
internal controls.

As of December 31, 2004, management
of the Company, including the President and Treasurer, conducted an evaluation of the
effectiveness of the design and operation of the Companys disclosure controls and
procedures with respect to the information generated for use in this Quarterly Report.
Based upon and as of the date of that evaluation, the President and Treasurer have
concluded the Companys disclosure controls were effective to provide reasonable
assurance that information required to be disclosed in the reports that the Company files
or submits under the relevant securities laws is recorded, processed, summarized and
reported within the time periods specified in the Commissions rules and forms. There
have been no changes in the Companys internal control over financial reporting
during the fiscal year ended December 31, 2004, that have materially affected, or are
reasonably likely to materially affect, the Companys internal control over financial
reporting.

It should be noted that while the
Companys management, including the President and Treasurer, believes the
Companys disclosure controls and procedures provide a reasonable level of assurance,
they do not expect that the Companys disclosure controls and procedures or internal
control over financial reporting will prevent all errors and all fraud. A control system,
no matter how well conceived or operated, can provide only reasonable, not absolute,
assurance the objectives of the control system are met. Further, the design of a control
system must reflect the fact there are resource constraints, and the benefits of controls
must be considered relative to their costs. Because of the inherent limitations in all
control systems, no evaluation of controls can provide absolute assurance all control
issues and instances of fraud, if any, have been detected. These inherent limitations
include the realities that judgments in decision-making can be faulty, and breakdowns can
occur because of simple error or mistake. Additionally, controls can be circumvented by
the individual acts of some persons, by collusion of two or more people, or by management
override of the controls. The design of any system of controls is based in part upon
certain assumptions about the likelihood of future events, and there can be no assurance
any design will succeed in achieving its stated goals under all potential future
conditions; over time, controls may become inadequate because of changes in conditions, or
the degree of compliance with the policies or procedures may deteriorate. Because of the
inherent limitations in a cost-effective control system, misstatements due to errors or
fraud may occur and not be detected.

The registered public accounting firm
that audited the financial statements included in this annual report has issued an
attestation report on Managements assessment of Tally Hos internal control
over financial reporting.

21

# PART III

# Item 9. Directors,
Executive Officers, Promoters and Control Persons.

The following are the names and ages
of all directors and executive officers, their positions and offices, and brief
descriptions of their business experience during the past five years:

Tal L. KapelnerAge:   29

President and Chairman of the Board
of Directors

From July 1997- March 1998, served as
a writers assistant and assistant to an Executive Producer on Unhappily Ever
After, a television sitcom produced by Touchstone Television, a division of Disney
Enterprises, and airing on the WB network. His duties included proof-reading scripts and
non-creative rewriting of scripts, recording various editing notes during the shows
tapings, and performing a variety of office assistant functions for an executive producer
of the show.

From March 1998- April 2000 was
self-employed as a technical writer and creative writer of screenplays and teleplays. Was
hired to write business plans for companies in various fields. Was never hired or paid for
any creative writing during this time.

From April 2000-present, President of
a California subchapter S corporation engaged in technical writing services named
Tally-Ho Ventures, Inc., which is not associated with our company. His duties
include preparing business plans for companies in various fields.

Cheney A. ShapiroAge:   21 Vice-President, Secretary
and a Director

From March 1998- June 2000, served as
a personal and business assistant to a celebrity  primarily film actress; name being
withheld  and her family. Her duties included being a household governess, which
entails being a nanny to three kids, running errands, house-sitting, and helping to run
the household; also provided administrative support for celebritys acting career.

From June 2000- January 2001, was a
personal and business assistant to a celebrity  primarily television actress; name
being withheld. Her duties included bookkeeping and various office assistant functions,
and household duties.

From January 2001- May 2002, employed
as executive assistant to the Chairman of David Morse and Associates, an insurance
adjustment firm based in Glendale, California. Duties included maintaining the external
and internal PR of the Chairman, event and meeting planning, scheduling of company
activities, some marketing for the company and various office assistant functions.

From July 2002-present, President of
Fly-By Enterprises, Inc., a California corporation offering administrative support
services, such as communication system and database overhauls, on a project basis. Her
duties include seeking and performing project-based administrative work to people in the
business community. Her administrative assistant projects include overseeing
organizational projects and database overhauls.

Ariella KapelnerAge:   57Treasurer

From August 1998-present, founded and
still serves as president of the nonprofit corporation Living & Education, Inc., a
provider of instructional videos covering such fields as parenting and drug and criminal
rehabilitation, under which she has produced educational materials and seminars currently
being sold world-wide.

22

From January  November 2001,
served as president of Investment Research, Inc., a for-profit corporation engaged in the
research of how venture capitalists and other investors choose which investments they wish
to make and upon which criteria to make such decisions. She has matched investors
interests with young companies looking for funding by calling persons holding themselves
out to be angel investors and surveying them as to which types of companies
they would be interested in investing and informing young companies looking for funding of
the results of her surveys.

From September 2001- January 2003,
served as executive director of the non-profit Federal Commission on Educational Rights,
Inc., a group which seeks to inform parents of their rights in the educational system. Ms.
Kapelner has educated many parents on these rights.

The following are all the directors
of Tally-Ho, their terms of office and periods in which they served, and identification of
any other directorships held in reporting companies, with names of those companies:

|Directors Name                                           | Term of Office as Director and
Period During Which Served                                                                                        | Other Directorships
Held in Reporting
Companies
|--------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------ | -----------------------------------------------
|Tal L. Kapelner    
                   
Cheney A. Shapiro | 1 year, 4 months                   
 Served November 21, 2002 - present
 1 year, 4 months                   
 Served November 21, 2002 - present | None
None                                      

Ariella Kapelner, treasurer, is the
mother of president and Chairman of the Board, Tal Kapelner.

Tally Hos board of directors
has determined that Tally Ho does not have an audit committee financial expert serving on
its audit committee. We do not have an audit committee financial expert at this time
because of our limited resources and lack of ongoing operations necessitating an audit
committee financial expert.

Tally Ho has adopted a Code of Ethics
that applies to our principle executive officer (Tal L. Kapelner), principal financial
officer (Ariella Kapelner), and principal controller (Tal L. Kapelner).

We undertake to provide to any person
without charge, upon request, a copy of our Code of Ethics. To receive a copy of our Code
of Ethics, mail a request for such to: Tally-Ho Ventures, Inc., 518 Oak Street #2,
Glendale, CA 91204.

# Item 10. Executive
Compensation.

No compensation was awarded to,
earned by or paid to any officer or director of Tally-Ho.

Item 11. Security Ownership
of Certain Beneficial Owners and Management and Related Stockholder Matters.

Tally Ho has no equity compensation
plans at this time.

23

We have 44,215,875 shares of common
stock outstanding at $0.001 par value. 75,000,000 shares of common stock are authorized.

The following information is for any
person, including any group of two or more persons acting as a partnership, syndicate or
other similar group, who is known to us to be the beneficial owner of more than five
percent of any class of our voting securities:

|Title of Class                           | Name and Address of Beneficial Owner                                                                                                                                                       | Amount and Nature
of Beneficial Owner                                                                                                 | Percent
of Class
|---------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ------------------------------------------------------------------------------------------------------------------------------------- | ----------------
|Common
Stock 
      
      
Common
Stock | Tal L. Kapelner            
c/o Tally-Ho Ventures, Inc.
518 Oak Street  #2         
                           
Cheney A. Shapiro          
c/o Tally-Ho Ventures, Inc.
518 Oak Street  #2 | 20,000,000 shares(1) 
President and
Chairman of the
Board of Directors
20,000,000 shares(2) 
Vice-President,
Secretary and a
Director | 45.2
45.2       

(1)    
          Tal Kapelner owns 20,000,000 shares of Tally-Ho, no part of which are options,
          warrants, or via any other rights, and he has no rights to acquire beneficial
          ownership of any other shares, whether through option, warrant, conversion
          privilege or any other right, within sixty days.

(2)    
          Cheney Shapiro owns 20,000,000 shares of Tally-Ho, no part of which are options,
          warrants, or via any other rights, and she has no rights to acquire beneficial
          ownership of any other shares, whether through option, warrant, conversion
          privilege or any other right, within sixty days.

We only have one class of equity
securities, and that is our Common Stock, and we have no parents or subsidiaries. For our
Common Stock, we present the following information regarding the security ownership of our
management, as of December 31, 2003:

|Title of Class                                                                            | Name and Address of Beneficial Owner                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | Amount and Nature
of Beneficial Owner                                                                                                                                                   | Percent
of Class    
|----------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------
|Common
Stock 
      
      
Common
Stock 
      
      
Common
Stock 
      
Common
Stock | Tal L. Kapelner                                
c/o Tally-Ho Ventures, Inc.                    
518 Oak Street  #2                             
                                               
Cheney A. Shapiro                              
c/o Tally-Ho Ventures, Inc.                    
518 Oak Street  #2                             
                                               
Ariella Kapelner                               
c/o Tally-Ho Ventures, Inc.                    
518 Oak Street  #2
All Directors and Executive Officers as a Group
c/o Tally-Ho Ventures, Inc.
518 Oak Street  #2 | 20,000,000 shares(1)
President and
Chairman of the
Board of Directors
20,000,000 shares(2)
Vice-President,
Secretary and a
Director
1,000,000 shares(3) 
Treasurer
41,000,000 shares(4) | 45.2
 45.2
 2.3
92.7

24

(1)    
          Tal Kapelner owns 20,000,000 shares of Tally Ho, no part of which are options,
          warrants, or via any other rights, and he has no rights to acquire beneficial
          ownership of any other shares, whether through option, warrant, conversion
          privilege or any other right, within sixty days.

(2)    
          Cheney Shapiro owns 20,000,000 shares of Tally Ho, no part of which are options,
          warrants, or via any other rights, and she has no rights to acquire beneficial
          ownership of any other shares, whether through option, warrant, conversion
          privilege or any other right, within sixty days.

(3)    
          Ariella Kapelner owns 1,000,000 shares of Tally Ho, no part of which are
          options, warrants, or via any other rights, and she has no rights to acquire
          beneficial ownership of any other shares, whether through option, warrant,
          conversion privilege or any other right, within sixty days.

(4)    
          All Directors and Executive Officers as a Group own 41,000,000 shares of Tally
          Ho, no part of which are options, warrants, or via any other rights, and they
          have no rights to acquire beneficial ownership of any other shares, whether
          through option, warrant, conversion privilege or any other right, within sixty
          days.

# Item 12. Certain
Relationships and Related Transactions.

We do not have any parent companies.
The names of our three promoters are Tal Kapelner, Cheney Shapiro and Ariella Kapelner,
who are the three founders of our company.

On November 21, 2002, Tal Kapelner
received 41,050,000 shares of common stock from Tally-Ho, valued at the par value of
$0.001 per share, which he received in exchange for our business plan, valued at $41,050.
Nothing else of any value was given to us by Mr. Kapelner or received by Mr. Kapelner from
us.

The business plan acquired by us from
Mr. Kapelner was acquired for 41,050,000 shares of our common stock, with the price per
share set at par value, $0.001, making the total amount paid by us for the business plan
$41,050. The principle followed in determining the amount of the business plan was an
approximation based on Tally-Hos and Tal Kapelners experience seeing similar
transactions occur for others. This determination regarding the amount of the business
plan was made by Tal Kapelner, President and Chairman of our company, and son of Ariella
Kapelner, the Treasurer of our company. The cost of the business plan to Tal Kapelner was
negligible, practically zero.

On November 21, 2002, 20,000,000 of
Mr. Kapelners initial 41,050,000 shares were assigned by Tal Kapelner to Cheney
Shapiro in connection with her services as a founder, a director, and our Vice-President
and Secretary. Nothing else of any value was given to us by Ms. Shapiro or received by Ms.
Shapiro from us.

Also on November 21, 2002, 1,000,000
shares of our common stock was assigned by Mr. Kapelner from his own personal share
holdings to Ariella Kapelner in connection with her services as a founder and our
Treasurer. Nothing else of value was given to us by Ms. Kapelner or received by Ms.
Kapelner from us.

25

# Item 13. Exhibits and
Reports on Form 8-K.

Index of Exhibits

|Exhibit 1.
Exhibit 2.
Exhibit 3.
Exhibit 4.
Exhibit 5. | Item 601(b)(3)(i) 
Item 601(b)(3)(ii)
Item 601(b)(4)    
Item 601(b)(31)   
Item 601(b)(32) | Articles of Incorporation*
Bylaws*
Instruments defining the rights of shareholders*
Rule 13a-14(a)/15d-14(a) Certifications     (attached)
Section 1350                                (attached)
|------------------------------------------------------ | ------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

* These exhibits are hereby
incorporated by reference to our Registration Statement on Form SB-2 filed November 7,
2003. File No. 333-104631.

There are no management contracts or
compensatory plans or arrangements required to be filed as an exhibit to this form.

There was no reports on Form 8-K
filed during the last quarter of the period covered by this report.

# Item 14. Principal
Accountant Fees and Services.

Audit Fees

The aggregate fees billed for
professional services rendered by our principal accountant for our audit, review of
regulatory filings, and all other services normally provided by the accountant in
connection with statutory or regulatory filings,

for fiscal year 2003:
$3,925

for fiscal year 2002: $0

Audit-Related Fees

The aggregate fees billed for
professional services rendered by our principal accountant for services related to
preparation of financial statements and review thereof that were not reported under
Audit Fees above,

for fiscal year 2003: $0

for fiscal year 2002: $0

Tax Fees

The aggregate fees billed for
professional services rendered by our principal accountant for tax compliance, tax advice
and tax planning,

for fiscal year 2003: $0

for fiscal year 2002: $0

26

All Other Fees

The aggregate fees billed for
professional services rendered by our principal accountant for all other services,

for fiscal year 2003: $0

for fiscal year 2002: $0

Tally Hos audit
committees pre-approval policy is to retain the services of a professional
accountant only once the threshhold established by Rule 2-01 of Regulation S-X has been
met. The audit committees pre-approval procedure is to carefully establish that each
of the tests delineated in paragraphs (b) and (c)(1)-(3) of Rule 2-01 of Regulation S-X.

# SIGNATURES

In
accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized.

| | TALLY-HO VENTURES, INC.
               (Registrant)
         
By:      /s/ Tal L. Kapelner
         Tal L. Kapelner, President
         
Date:    April 5, 2004
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------

In
accordance with the Exchange Act, this report has been signed below by the following
persons on behalf of the registrant and in the capacities and on the dates indicated.

| | By:      /s/ Tal L. Kapelner
         Tal L. Kapelner, President, Controller
         and Chairman of the Board of Directors
        
Date:    April 5, 2004
         
By:      /s/ Cheney A. Shapiro
         Cheney A. Shapiro, Vice-President,
         Secretary and a Director
         
Date:    April 5, 2004
         
By:      /s/ Ariella Kapelner
         Ariella Kapelner, Treasurer and Chief
         Financial Officer
         
Date:    April 5, 2004
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Supplemental information
to be Furnished With Reports Filed Pursuant to Section 15(d) of the Exchange Act By Non-Reporting Issuers

No annual report or proxy material
has been sent to security holders.