U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

                  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 2003


                        Commission file number 333-36666

                                 IBX GROUP, INC.
                 (Name of Small Business issuer in its charter)


                  Florida                                65-0810941
      (State or Other Jurisdiction of                   (IRS Employer
       Incorporation or Organization)               Identification Number)


      350 Jim Moran Boulevard; Deerfield Beach, Florida           33442
      --------------------------------------------------          -----
           (Address of Principal Executive Offices)             (Zip Code)


         Issuer's Telephone Number, Including Area Code: (954) 312-1660
                                                         --------------
                               ___________________

        Securities registered pursuant to Section 12(b) of the Act: None

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

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or
for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.
Yes [X]  No [ ]

Check if there is no disclosure of delinquent filers pursuant to Item 405 of
Regulation S-B is not contained 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. [ ]

State issuer's revenues for its most recent fiscal year: $3,327,852.

The aggregate market value of the issuer's common stock, $.001 par value, held
by non-affiliates on March 22, 2004 was approximately $4,800,000.

On March 29, 2004, there were 96,507,877 shares of the issuer's common stock
outstanding.

                       DOCUMENTS INCORPORATED BY REFERENCE
None

<PAGE>
                                TABLE OF CONTENTS

                            FORM 10-KSB ANNUAL REPORT

                                 IBX GROUP, INC.
                                                                            PAGE
PART I

Item 1.  Description of Business...............................................3

Item 2.  Description of Property...............................................9

Item 3.  Legal Proceedings.....................................................9

Item 4.  Submission of Matters to a Vote of Security Holders...................9


PART II

Item 5.  Market for the Registrant's Common Equity, Related Stockholder
         Matters And Small Business Issuer Purchases of Equity Securities.....10

Item 6.  Management's Discussion and Analysis of Financial Condition
         and Results of  Operations...........................................11

Item 7.  Financial Statements.................................................20

Item 8.  Changes in and Disagreements on Accounting and Financial Disclosure .20

Item 8A  Controls and Procedures..............................................20


PART III

Item 9.  Directors, Executive Officers of the Registrant......................20

Item 10. Executive Compensation...............................................21

Item 11. Security Ownership of Certain Beneficial Owners and Management
         and Related Stockholder Matters......................................22

Item 12. Certain Relationships and Related Transactions.......................23


PART IV

Item 13. Exhibits and Reports of Form 8-K.....................................25

Item 14  Principal Accountant Fees and Services...............................25

SIGNATURES....................................................................27


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                                     PART I

ITEM 1. DESCRIPTION OF BUSINESS.

IBX Group, Inc. develops and deploys innovative, cost-effective methods for
integrating financial, administrative and information services for the
healthcare industry. iBX operates under five divisions:

   o  IBX TECHNOLOGIES, which enables healthcare organizations to maximize their
      accounts receivables;

   o  FLORIDA HEALTHSOURCE, a network of physical therapy and wellness centers;

   o  MEDICOMPLIANT SOLUTIONS, which ensures medical practices' compliance with
      today's complex legal requirements;

   o  IBX TRANSCRIPTION SERVICES, which offers physicians quick turn-around and
      Web-accessible progress reports;

   o  NURSESSTAT, which deploys leading-edge staffing administration technology
      to healthcare facilities and provides cost-effective temporary staffing
      solutions;

   o  SportshealthNet.com and TheNetDigest.com, interactive Web portals
      providing patients with comprehensive healthcare information and advice,
      and increasing physician referrals.

IBX TECHNOLOGIES

iBX Group's iBX Technologies division creates and deploys innovative solutions
for the healthcare industry including equipment integral to the operations of
iBX Transcription Services, and technology used for the development of paperless
offices, medical record management and storage, inventory control, and other
developing applications.

iBX Technologies has created online order entry/inventory control systems,
hand-held wireless PC applications and other interactive, real-time applications
that help reduce administrative paperwork and expedite data input and updating.
With the help of iBX Technologies, healthcare providers are now able to access
current inventory or billing files from their office workstations or wireless
hand-held devices, and instantly update operating and accounting files.

The company also developed one of the only Internet-enabled applications for
patient functional capacity evaluations, which is now available at Florida
HealthSource clinics and other physical therapy centers nationwide.

In addition, this division operates iBX's core business, accounts receivables
management, which that enables a wide array of hospital-based physician groups,
large medical practices and ancillary healthcare organizations to achieve their
financial objectives. Through work-flow analysis, reporting and online access to
data, iBX Technologies enhances communication between all involved parties. By
reducing administrative costs, the company provides solutions that help
healthcare organizations meet their revenue goals and improve overall patient
satisfaction. The division is continuing to aggressively promote the outsourcing
of self-pay receivables, a more labor-intensive segment of A/R management.

FLORIDA HEALTHSOURCE

iBX is the owner of Florida HealthSource, LLC, a statewide network of healthcare
clinics and a leading workers' compensation referral network for rehabilitation
services throughout Florida. During 2003, Florida HealthSource brought several
existing clinics under management, and in early 2004 opened a multi-disciplinary
healthcare facility in Boca Raton, Florida that offers physical therapy,
occupational medicine, pain management and chiropractic care. The new clinic is
part of the company's strategic plan to capitalize on the emerging "wellness"
trend in healthcare by bringing these various services under one roof. Florida
HealthSource centers will also serve as a showcase for iBX's menu of products
and services specially designed for the healthcare industry. iBX recently
acquired a a pulmonary rehabilitation clinic in Delray Beach, Florida and is
exploring opportunities within several other medical disciplines. In addition,
Florida HealthSource is a leader in providing comprehensive healthcare services
in the areas of chronic pain and job-related injuries, meeting the needs of
Florida's employers and payers. Its mission is to reduce lost time and medical
and indemnity costs by combining board-certified pain management physicians,
physical and occupational therapists, transportation and translation services at
locations throughout the state. Florida HealthSource has been established as the
preferred provider network for more than 450,000 employees throughout the state
of Florida.
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Since its acquisition by iBX, Florida HealthSource has entered into two new
vendor agreements, including a contract that establishes the company as a
preferred physical and occupational therapy vendor for a major U.S. retailer. In
January 2003, Florida HealthSource entered into a contract with First Health
Group Corp., the largest directly contracted medical network for workers
compensation, group health and government in the U.S. In March 2003, this
division received national referral status through a contract with CorVel Corp.,
a California-based independent provider of leading-edge managed care services
and solutions for workers compensation, group health and auto insurance markets.

Florida HealthSource provides case managers and adjusters with a statewide
referral network of over 100 pre-approved and qualified service providers for
their insured patients. This allows the payer to control its costs by sending
the patients to providers with negotiated fees. Florida HealthSource will refer
patients to facilities owned by iBX if they meet the criteria for the patient.

MEDICOMPLIANT SOLUTIONS

IBX's MediCompliant Solutions division is a healthcare legal services
organization that enables healthcare providers to achieve and maintain
compliance with today's increasingly complex government regulations. The company
is currently focused on providing legal expertise regarding the comprehensive
patient privacy and portability requirements of the Health Insurance Portability
and Accountability Act (HIPAA) and the new electronic billing standards required
for Medicare reimbursement.

In February 2003, MediCompliant Solutions entered into an agreement with Paris
Health Services, a developer of comprehensive EDI transaction and compliance
software for the healthcare industry, to provide hospitals, large physician
groups and ancillary healthcare organizations access to all general Medicare
compliance risk areas identified byOffice of the Inspector General, as well as
the wide-ranging issues covered by the HIPAA privacy and security standards.
This agreement, together with a new, more competitive pricing structure, has
allowed MediCompliant Solutions to offer cost-effective compliance "insurance
policies" to healthcare providers

MediCompliant Solutions also makes available several products to help healthcare
providers create "paperless" offices, as well as document their efforts to
comply with HIPAA and Medicare regulations. These include an electronic tablet
that captures patient signatures upon arrival at doctors' offices and on all
standard forms, and HIPAAdb, an Internet-based tracking system for healthcare
compliance.

IBX TRANSCRIPTION SERVICES

iBX Transcription Services offers healthcare providers complete medical
transcription and dictation services, and provides a platform for IBX Group's
digital online dictation/transcription product and document management service,
along with the workflow services associated with it. The company offers offers
several unique features that set it apart from its competitors including
compliance with all current healthcare legislation, including HIPAA and Medicare
regulations, and state-of-the-art technology that gives users several options in
dictating and retrieving medical records.

The company offers physicians substantial savings by eliminating the need for an
in-house transcriptionist; a secure web-based application providing file upload,
tracking and download capabilities; archiving of original voice dictation files;
archiving of transcribed reports; and an event log of both outgoing and incoming
Internet transfers.

NURSESSTAT(R)

The mission of iBX Group's NursesSTAT division is two-fold: to help hospitals
manage nurses more effectively and, in so doing, to improve working conditions
for nurses.

Hospitals find it labor-intensive and difficult to schedule nurses, and rely
extensively on expensive outside staffing agencies to fill increasing vacant
positions. NursesSTAT offers a technological solution to this ongoing issue: an
Internet-enabled, automated system that puts nurses and hospitals together,
allowing hospitals to better utilize their own nursing pools, reduce dependence
on staffing agencies and provide nurses with greater autonomy and job
satisfaction. The system has been received very positively because it allows
nurses to set their own supplemental schedules and avoid disruptive phone calls,
and allows hospitals to lower costs. Hospitals are then able to redirect some of
these available funds to much-needed nurse recruitment and retention programs.

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Contracts are in place at several prominent hospitals in South Florida, and
healthcare facilities nationwide are expressing interest in receiving the same
benefits. NursesSTAT also provides cost-effective temporary medical
professionals to hospitals and long-term-care facilities and is working to
expand its capabilities in this area.

THERATOUCH

In 2003, iBX acquired rights to Theratouch, which is a programmable interactive
massage device using robotic technology to provide users with a complete massage
from the neck to calf. The device can be programmed or the user can use a
joystick to adjust the speed, intensity and location. iBX is marketing
Theratouch to physical therapy centers, chiropractors, hotels and fitness clubs.

SPORTSHEALTHNET.COM

iBX Group, Inc., owns SportsHealthNet.com, an interactive Web portal that
attracts high levels of consumer traffic by providing comprehensive healthcare
information and advice, and helps participating physicians increase the number
of referrals to their practices. SportsHealthNet specializes in sports
medicine-related issues and provides a wealth of information regarding exercise,
nutrition and ways to prevent common injuries, as well as links to other
health-related sites. An interactive forum gives consumers 24/7 access to sports
medicine professionals and allows them to receive personalized replies to
specific health questions.

SportsHealthNet has been integral to the increasing success of iBX's Florida
HealthSource division, which maintains a statewide referral network with access
to 450,000 Florida residents. SportsHealthNet provides orthopedic surgeons,
chiropractors, physical therapists and other healthcare providers with a vast
source of additional referrals, helping them to increase their visibility and
maximize revenue.

A newly upgraded SportsHealthNet.com is equipped with a number of new features,
including a format that allows physicians to advertise their services, an
exclusive membership program, and sophisticated e-commerce capabilities that
enables consumers to purchase sports and sports injury-related products. The
company has also launched an aggressive, integrated marketing campaign designed
to increase traffic to the site, as well as maximize commissions and e-commerce
fees.

SALES AND MARKETING

The current marketing focus for our financial, administrative and technology
services is the 14,000-plus physician market in the South Florida area. The
majority of these practices are not currently using Windows-based practice
management software, but many have made the transition to outsourcing their
medical document management needs We believe that physicians are trained to
concentrate on the professional rather than business aspects of their practices.
They do, however, recognize that their income is being limited by the prevailing
healthcare system while their cost of doing business has increased substantially
and are becoming more and more receptive to the types of cost-effective
solutions we offer.

We intend to continue to offer our services through physician office
administrators and hospital accounts receivable managers who make most service-
provider selection decisions. Administrators are often over-worked, underpaid
and looking for reasonable means to increase their productivity while decreasing
the time demands with which they are faced. These practices typically pay
between $75,000 and $350,000 annually for their current suite of services.

We also intend to expand our target market geographically and through a
segment-oriented approach by contacting hospitals and large physician groups
outside the South Florida market in areas that we can already demonstrate
expertise, results and third-party endorsements.

A formal marketing campaign, consisting of a full-service web site, a variety of
printed materials and public relations outreach, is solidly in place, and we're
continuing to maintain strong word-of-mouth referrals from medical
professionals, attorneys and accountants within the healthcare industry. In
addition, we are in the early stages of a nationwide public relations and
marketing campaign to create awareness of our TheraTouch and ActiPatch products.

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CONCENTRATION OF CUSTOMERS

For the year ended December 31, 2003, our three largest customers accounted for
an aggregate of 19% of revenues and 52% of accounts receivable. Consequently,
our success is materially dependent on our relationship with these customers and
their continued viability. We not reliant on any single vendor.

COMPETITION

The market for medical business solutions is highly competitive and is
characterized by rapidly changing technology, evolving user needs and frequent
introduction of new products. Each of our products and services have material
competition from other companies, however we believe that few, if any, of its
competitors offer its clients the comprehensive services available from us.

Our principal competitors in the practice management market include WebMD and
ProxyMed, which have substantial reputations in the Internet medical services
market. However, we believe that they do not concentrate on providing primary
services such as accounts receivable management, billing and collections
processing or standard day-to-day operational services designed to increase
physicians' profits. In addition, many well-known accounting and consulting
firms have entered into the medical practice management market by advertising
business management services specifically to physicians on the basis that their
expertise can enhance physician receivable collections and better manage their
work flow. We view these companies as significant competitors in a market where
knowing physician nuances requires extreme sensitivity, empathy and
understanding of their dynamic work environment.

There are many companies offering physical therapy/rehabilitation services in
Florida, ranging from large companies like HealthSouth to single office centers
owed by chiropractors and physical therapists. IBX believes that the most
important issue in obtaining new business is the source of referral, which is
often from a physician or an insurance company.

We believe that competition will continue to increase as a result of a number of
factors, including the aging of baby boomers and their resulting medical-related
needs, the growth of the Internet and physicians' evolving awareness of what the
Internet can do for their business and the continuing consolidation of Internet
companies' services. We believe that the primary factors affecting competition
in our markets include

   o  product functionality,
   o  performance, flexibility and features,
   o  use of open standards technology,
   o  quality of service and support,
   o  reputation,
   o  product and service pricing, and,
   o  overall cost of ownership.

GOVERNMENT REGULATION AND HEALTHCARE REFORM The healthcare industry is subject
to changing political, economic and regulatory influences that may affect the
procurement practices and operations of healthcare organizations. Our products
are designed to function within the structure of the healthcare financing and
reimbursement system currently being used in the United States. During the past
several years, the healthcare industry has been subject to an increase in
governmental regulation of, among other things, reimbursement rates.

Proposals to reform the U.S. healthcare system have been and will continue to be
considered by the U.S. Congress. These programs may contain proposals to
increase governmental involvement in healthcare and otherwise change the
operating environment for our existing and potential customers. Healthcare
organizations may react to these proposals and the uncertainty surrounding those
proposals by curtailing or deferring investments, including those for our
products and services. On the other hand, changes in the regulatory environment
have in the past increased and may continue to increase the needs of healthcare
organizations for cost-effective information management and thereby enhance the
marketability of our products and services. We cannot predict with any certainty
what impact, if any, such proposals or healthcare reforms might have on our
results of operations, financial condition and business.

RELATIONSHIPS WITH PHYSICIANS AND OTHER PROVIDERS

Various state and federal laws regulate relationships among providers of
healthcare services, including employment or service contracts and investment
relationships. These restrictions include a federal criminal law prohibiting (a)
the offer, payment, solicitation or receipt of remuneration by individuals or

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entities to induce referrals of patients for services reimbursed under the
Medicare or Medicaid programs or (b) the leasing, purchasing, ordering,
arranging for or recommending the lease, purchase or order of any item, good,
facility or service covered by such programs (the "Fraud and Abuse Law"). In
addition to federal criminal sanctions, violators of the Fraud and Abuse Law may
be subject to significant civil sanctions, including fines and/or exclusion from
the Medicare and/or Medicaid programs.

In 1991, the OIG issued regulations describing compensation arrangements which
are not viewed as illegal remuneration under the Fraud and Abuse Law (the "1991
Safe Harbor Rules"). The 1991 Safe Harbor Rules create certain standards ("Safe
Harbors") for identified types of compensation arrangements which, if fully
complied with, assure participants in the particular arrangement that the OIG
will not treat that participation as a criminal offense under the Fraud and
Abuse Law or as the basis for an exclusion from the Medicare and Medicaid
programs or an imposition of civil sanctions.

In 1992, regulations were published in the Federal Register implementing the OIG
sanction and civil money penalty provisions established in the Fraud and Abuse
Law. The regulations provide that the OIG may exclude a Medicare provider from
participation in the Medicare Program for a five-year period upon a finding that
the Fraud and Abuse Law has been violated. The regulations provide that if one
purpose of remuneration that is offered, paid, solicited or received is to
induce referrals, then the statute is violated. The regulations also provide
that after the OIG establishes a factual basis for excluding a provider from the
program, the burden of proof shifts to the provider to prove that it has not
violated the Fraud and Abuse Law.

The OIG closely scrutinizes healthcare joint ventures involving physicians and
other referral sources. In 1989, the OIG published a Fraud Alert that outlined
questionable features of "suspect" joint ventures, and has continued to rely on
such Fraud Alert in later pronouncements. The 1991 Safe Harbor Rules do not
expand the scope of activities that the Fraud and Abuse Law prohibits, nor do
they provide that failure to fall within a Safe Harbor constitutes a violation
of the Fraud and Abuse Law; however, the OIG has indicated that failure to fall
within a Safe Harbor may subject an arrangement to increased scrutiny.

The so-called "Stark II" provisions of the Omnibus Budget Reconciliation Act of
1993 amended the federal Medicare statute to prohibit the making by a physician
of referrals for "designated health services" including physical therapy,
occupational therapy, radiology services or radiation therapy, to an entity in
which the physician has an investment interest or other financial relationship,
subject to certain exceptions. In January 1998, the Department of Health and
Human Services published proposed regulations (the "Proposed Stark Regulations")
under the Stark II statute and solicited comments thereon. On January 4, 2001,
the Department of Health and Human Services published final regulations relating
to part of the Stark II statute (the "Phase I Final Stark Regulations") and
announced its intention to publish a second, "Phase II" set of regulations
covering the remainder of the statute and responding to comments received on the
Phase I Final Stark Regulations at some unspecified future date. The Phase I
Final Stark Regulations, which differ substantially in many respects from the
Proposed Stark Regulations, had a specified effective date of January 4, 2002.
In addition, a number of states have passed or are considering statutes which
prohibit or limit physician referrals of patients to facilities in which they
have an investment interest.

All of iBX's current businesses are exempt from the above statutes since no
physician has any direct interest in any of its facilities.

THE HEALTH INSURANCE PORTABILITY AND ACCOUNTABILITY ACT OF 1996

In an effort to combat healthcare fraud, Congress included several anti-fraud
measures in the Health Insurance Portability and Accountability Act of 1996
("HIPAA"). HIPAA, among other things, amends existing crimes and criminal
penalties for Medicare fraud and enacts new federal healthcare fraud crimes.
HIPAA also expands the Fraud and Abuse Law to apply to all federal healthcare
programs, defined to include any plan or program that provides health benefits
through insurance that is funded by the federal government. Under HIPAA, the
Secretary of the Department of Health and Human Services (the "Secretary") may
exclude from the Medicare program any individual who has a direct or indirect
ownership or control interest in a healthcare entity that has been convicted of
a healthcare fraud crime or that has been excluded from the Medicare program.
HIPAA directs the Secretary to establish a program to collect information on
healthcare fraud and abuse to encourage individuals to report information
concerning fraud and abuse against the Medicare program and provides for payment
of a portion of amounts collected to such individuals. HIPAA mandates the

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establishment of a Fraud and Abuse Program, among other programs, to control
fraud and abuse with respect to health plans and to conduct investigations,
audits, evaluations, and inspections relating to the delivery of and payment for
healthcare in the United States.

HIPAA prohibits any person or entity from knowingly and willfully committing a
federal healthcare offense relating to a "health care benefit program". Under
HIPAA, a "health care benefit program" broadly includes any private plan or
contract affecting interstate commerce under which any medical benefit, item, or
service is provided to any individual. Among the "federal health care offenses"
prohibited by HIPAA are healthcare fraud and making false statements relative to
healthcare matters. Any person or entity that knowingly and willfully defrauds
or attempts to defraud a healthcare benefit program or obtains by means of false
or fraudulent pretenses, representations or promises, any of the money or
property of any healthcare benefit program in connection with the delivery of
healthcare services is subject to a fine and/or imprisonment. In addition, HIPAA
provides that any person or entity that knowingly and willfully falsifies,
conceals or covers up a material fact or makes any materially false or
fraudulent statements in connection with the delivery of or payment of
healthcare services by a healthcare benefit plan is subject to a fine and/or
imprisonment.

HIPAA further expands the list of acts which are subject to civil monetary
penalties under federal law and increases the amount of civil penalties which
may be imposed. HIPAA provides for civil fines for individuals who retain an
ownership or control interest in a Medicare or Medicaid participating entity
after such individuals have been excluded from participating in the Medicare or
Medicaid program. HIPAA further provides for civil fines for individuals who
offer inducements to Medicare or Medicaid eligible patients if the individuals
know or should know that their offers will influence the patients to order or
receive items or services from a particular provider, practitioner or supplier.

In addition, HIPAA mandates, for all healthcare providers, standardization in
the use, storage, and transfer of electronically transmitted healthcare data and
also requires that healthcare providers, payors and clearinghouses adopt
detailed new procedures for ensuring the privacy and security of individually
identifiable health information. In August 2000, the Department of Health and
Human Services published final regulations adopting standards for electronic
transactions and for code sets to be used in those transactions. Those
regulations have a specified effective date of October 16, 2002 for most
providers, including us. In December 2000, the Department released final
regulations establishing standards for the privacy of individually identifiable
health information. The final privacy regulations, which differ substantially
from previously proposed regulations, impose significant limitations on the use
and disclosure of individually identifiable health information by providers,
including us, as well as payors and clearinghouses. The final regulations take
effect in April 2003. The final privacy regulations have been significantly
criticized by many parts of the healthcare industry, and further changes in such
regulations or delays in their implementation are possible.

Compliance with the HIPAA privacy and electronic standards regulations will
require significant changes in current information and claims processing
practices utilized by most healthcare providers, although we believe we are
compliant at this time.

We cannot predict whether other regulatory or statutory provisions will be
enacted by federal or state authorities which would prohibit or otherwise
regulate relationships which we have established or may establish with other
healthcare providers or the possibility of materially adverse effects on its
business or revenues arising from such future actions. We believe, however, that
we will be able to adjust our operations so as to be in compliance with any
regulatory or statutory provision that may be applicable.

INTELLECTUAL PROPERTY

We seek to protect our proprietary information through nondisclosure agreements
with our employees. Our policy is to have employees enter into nondisclosure
agreements containing provisions prohibiting the disclosure of confidential
information to anyone outside iBX, requiring disclosure to us of any new ideas,
developments, discoveries or inventions conceived during employment, and
requiring assignment to iBX of proprietary rights to such matters that are
related to our business.

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We also rely on a combination of trade secrets, copyright and trademark laws,
contractual provisions and technical measures to protect our rights in various
methodologies, systems and products and knowledge bases. We believe that because
of the rapid pace of technological change in the healthcare industry, trade
secret and copyright protection are less significant than factors such as the
knowledge, ability, experience and integrity of our employees, frequent product
enhancements and the timeliness and quality of support services.

Although we believe that our products do not infringe on the intellectual
property rights of others, we cannot assure you that such a claim will not be
asserted against us in the future. If asserted, such a claim could cause us to
lose revenues or incur substantial litigation expense.

EMPLOYEES

As of December 31, 2003, we had 47 full time employees, of which three were
executive, 3 were administrative and three were technical employees. No
employees are presently represented by any labor unions. We believe our
relations with employees to be good, however additional employees will need to
be recruited to meet our growth projections.

ITEM 2.  DESCRIPTION OF PROPERTY

Our principal place of business is located at 350 Jim Moran Boulevard, Deerfield
Beach, Florida, 33442. This is an office park type setting where others
businesses are administrative in nature. We occupy approximately 15,000 square
feet space pursuant to a lease ending on August 31, 2005. The rent is currently
$21,700 per month. We lease four Florida Health Source facilities, in Boca
Raton, Delray Beach, Oakland Park and Jacksonville, Florida. The aggregate
annual rent is approximately $200,000 and the leases expire at various times
from 2006 to 2008.

ITEM 3.  LEGAL PROCEEDINGS

We are not a party to any material litigation, nor are we aware of any potential
material litigation, other than as set forth below.

WILLIAM DUDZIAK V. PRIMED TECHNOLOGIES, L.C., EVAN BROVENICK, ET AL,

Mr. Dudziak loaned PriMed approximately $870,000 on November 28, 1999, repayment
of which was secured by all ownership interests in PriMed LC. The proceeds of
the loan were used by PriMed to repurchase the PriMed stock held by Primus
Physician Services. A lawsuit was filed against PriMed LC, Evan Brovenick,
Natalie Brovenick, Alvin Brovenick, Susan Brovenick and David Blechman. It was
originally agreed between the parties that this money would be paid back within
30 days.

Since the defendants failed to repay the money in a timely fashion, in 2001 a
stipulation of settlement was executed between the parties, whereby it was
agreed that Mr. Dudziak would suspend the litigation pending efforts by PriMed
and Evan Brovenick to complying with certain terms set forth in the stipulation.
iBX did not stay current with that agreement. In October 2002, iBX made a
payment of $275,000 and the parties entered into an amended settlement agreement
effective November 7, 2002 whereby Dudziak agreed to dismiss his action.
Pursuant to the terms of the Agreement, the Company is obligated to make certain
monthly payments, all of which have been made to date. Mr. Dudziak, pursuant to
the settlement agreement, has a lien and perfected security interest on all of
the assets of iBX Technologies, Inc., which is iBX's primary operating
subsidiary and on 11,550,000 shares of iBX common stock owned by Evan Brovenick
and David Blechman. It is expected that the remaining balance will be paid by
March 31, 2004 and all obligations will be satisfied.

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

         None
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                                     PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS

Our common stock began trading on January 4, 2002 on the OTC Bulletin Board
under the symbol iBXG. The following table sets forth the range of high and low
closing sale price as reported by the OTC Bulletin Board for our common stock
for the fiscal quarters indicated. The OTC Bulletin Board quotations represent
quotations between dealers without adjustment for retail mark-up, markdowns or
commissions and may not represent actual transactions.

         2002                            HIGH              LOW
         ----                            ----              ---
         January 1 to December 31        $.70             $.13
         April 1 to June 30              $.43             $.17
         July 1 to September 30          $.18             $.09
         October 1 to December 31        $.17             $.04

         2003
         January 1 to March 31           $.19             $.10
         April 1 to June 30              $.21             $.16
         July 1 to September 30          $.19             $.11
         October 1 to December 31        $.14             $.05

DIVIDEND POLICY

No dividends have been paid on the shares of our common stock or preferred
stock, and we do not anticipate the payment of cash dividends in the foreseeable
future. We anticipate that, for the foreseeable future any profit we report will
be devoted to our future operations and that cash dividends would not be paid to
our shareholders.

SALES OF UNREGISTERED SECURITIES

In September 2001, we issued 11,550,000 shares of common stock to two
individuals pursuant to the acquisition of Primed.

In November 2001, we issued 125,000 shares each to two consultants.

In December 2001, we issued 10,062,500 shares to three accredited investors upon
conversion of outstanding convertible bonds originally issued by Primed.

On December 19, 2001, we concluded a private placement of $200,000 in units
comprised of an aggregate of 10,937,500 shares of common stock, class A warrants
entitling the holders to purchase up to 20,000,000 shares of common stock at an
exercise price of $0.10 per share; and class B warrants entitling the holders to
purchase up to 20,000,000 shares of common stock at an exercise price of $0.20
per share.

In December 2001, we issued 750,000 shares of common stock to Market Watch
Corporation as partial payment under a corporate information services agreement.

In December 2001, we issued an aggregate of 1,000,000 shares to 11 persons, all
of whom were employees or consultants of the Company, for services rendered.

In May 2002, we issued an aggregate of 1,081,880 shares to one entity in
exchange for cancellation of a $90,618 portion of a $104,588 promissory note and
a subscription receivable of $17,570. This entity subsequently transferred the
shares to its four shareholders.

In May 2002, we issued an aggregate of 250,000 shares upon the exercise of
outstanding warrants to two persons.

                                       10
<PAGE>

In May and June 2002, an aggregate of 850,000 class A warrants were exercised by
three persons using the repayment of a loan.

In 2002, as described under Item 12-Certain Relationships and Related
Transactions, the Calvo Family Spendthrift Trust, a principal shareholder,
converted 8,000,000 shares of common stock into 80,000 shares of Class A
Non-Voting Convertible Preferred Stock.

In December 2002, IBX issued 1,000,000 shares of common stock to consultants,
employees and an outside director for services rendered and to be rendered in
the future.

In December 2003, iBX issued 1,500,000 shares of common stock to employees and
consultants for services rendered.

In December 2003, the Company sold 592,366 unregistered shares of common stock
to investor for net proceeds of $29,618.

In 2003, iBX issued an aggregate of 3,847,500 shares in two acquisitions to a
total of 41 persons.

In March 2004, iBX issued 2,300 shares of Series B Preferred Stock and 4,600,000
warrants, of which 1,000 shares of Series B Preferred Stock and 1,000,000
warrants for $100,000 in cash and 1,300 shares of Series B Preferred Stock and
2,600,000 warrants were issued in payment of outstanding liabilities. Each share
of Series B Preferred Stock is convertible into 2,000 shares of common stock and
each warrant is exercisable at $.10 per share.

In January 2004, iBX sold $200,000 of convertible debentures to one investor and
at the same time issued the investor 500,000 warrants and 500,000 shares of
common stock. The debentures are convertible into common stock at the lesser of
(i) 65% of the average of the three lowest closing bid prices of the Common
Stock during the five (5) trading days immediately prior to the Conversion Date
or (ii) $.08. The warrants are exercisable at $.05 per share.

In March 2004, iBX issued a convertible note for $174,000, of which $100,000 was
for cash and $74,000 for the cancellation of outstanding liabilities to an
existing shareholder. The note provides for 8% interest, a maturity date of
March 12, 2005and a security interest in all of iBX's assets. iBX is required to
provide the holder with 90 days' notice of any prepayment, although there is no
prepayment penalty. The note is convertible to common stock. The conversion
price is the lowest of $.035, 70% of the closing bid price on the date of
conversion or 70% of the offering price any offering by iBX until March 2005.

All of such issuances were exempt from registration pursuant to Section 4(2) of
the Securities Act of 1933 based on the relationship of such persons to IBX.

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

The following discussion should be read in conjunction with iBX's audited
financial statements and notes thereto included herein. In connection with, and
because it desires to take advantage of, the "safe harbor" provisions of the
Private Securities Litigation Reform Act of 1995, iBX cautions readers regarding
certain forward looking statements in the following discussion and elsewhere in
this report and in any other statement made by, or on the behalf of iBX, whether
or not in future filings with the Securities and Exchange Commission. Forward
looking statements are statements not based on historical information and which
relate to future operations, strategies, financial results or other
developments. Forward looking statements are necessarily based upon estimates
and assumptions that are inherently subject to significant business, economic
and competitive uncertainties and contingencies, many of which are beyond iBX's
control and many of which, with respect to future business decisions, are
subject to change. These uncertainties and contingencies can affect actual
results and could cause actual results to differ materially from those expressed
in any forward looking statements made by, or on behalf of, iBX. iBX disclaims
any obligation to update forward looking statements.

                                       11
<PAGE>

OVERVIEW

iBX Group, Inc. was organized under the laws of the State of Florida in July
1997 as Vidkid Distribution, Inc. to own, distribute and produce children's
intellectual properties. to own, distribute and produce children's intellectual
properties In February 2001, we were spun-off from our parent company
emailthatpays.com, Inc. On September 25, 2001, Vidkid acquired all of the
outstanding capital stock of Primed Technologies, Inc., a Delaware corporation
in a stock-for stock exchange. Primed was organized under the laws of the State
of Florida on February 4, 1999 as a limited liability company and reorganized as
a corporation in the State of Delaware on January 1, 2000. Primed's
shareholders, Evan Brovenick and David Blechman, received 11,550,000 shares or
approximately 81% of the outstanding common stock of Vidkid on a fully diluted
basis. Vidkid's name was changed to iBX Group, Inc.

We are engaged in providing administrative services such as accounting, billing
and collection, claims We develop and deploy innovative, cost-effective methods
for integrating financial, administrative and information services for the
healthcare industry. IBX Group, Inc. develops and deploys innovative,
cost-effective methods for integrating financial, administrative and information
services for the healthcare industry. During the last two years, we
significantly expended our capabilities. Our business initially focused on
healthcare transaction services, primarily assisting providers with billing and
collection of receivables. We have since added expertise in regulatory
compliance, transcription services, staffing and technology solutions. We have
devoted significant resources towards developing various strategic partners and
opportunities to better address the needs of the healthcare marketplace. These
investments in our product development and infrastructure resulted in
significant expenditures and we are now starting to recognize new revenue from
these initiatives.

iBX operates under five divisions:

   o  IBX TECHNOLOGIES, which enables healthcare organizations to maximize their
      accounts receivables;
   o  FLORIDA HEALTHSOURCE, a network of physical therapy and wellness centers;
   o  MEDICOMPLIANT SOLUTIONS, which ensures medical practices' compliance with
      today's complex legal requirements;
   o  IBX TRANSCRIPTION SERVICES, which offers physicians quick turn-around and
      Web-accessible progress reports;
   o  NURSESSTAT, which deploys leading-edge staffing administration technology
      to healthcare facilities and provides cost-effective temporary staffing
      solutions.

IBX also recently relaunched SPORTSHEALTHNET.COM AND THENETDIGEST.COM,
interactive Web portals providing patients with comprehensive healthcare
information and advice, and increasing physician referrals.

         Our Florida Healthsource subsidiary recently opened a
multi-disciplinary clinic in a prominent medical center in Boca Raton, Florida.
The healthcare clinic will offer physical therapy, occupational medicine, pain
management, chiropractic care and wellness services. The new clinic is part of
the company's strategic plan to capitalize on the emerging "wellness" trend in
healthcare by bringing these various services under one roof. Florida
HealthSource centers will also serve as a showcase for iBX's menu of products
and services specially designed for the healthcare industry. Florida
HealthSource provides case managers and adjusters with a statewide referral
network of over 100 pre-approved and qualified service providers for their
insured patients. This allows the payer to control its costs by sending the
patients to providers with negotiated fees.

         An aggregate of 11,550,000 shares of iBX held by Evan Brovenick and
David Blechman, our principal officers, and the assets of PriMed are subject to
a creditor's lien. Failure to comply with the terms and conditions of the
related loan documents could result in a default and the forfeiture of these
shares and/or assets to the lender.

RESULTS OF OPERATIONS

YEAR ENDED DECEMBER 31, 2003 COMPARED TO YEAR ENDED DECEMBER 31, 2002

For financial reporting purposes, iBX operated in two reportable business
segments: healthcare transaction management and technology services; and
physical therapy and rehabilitation services.

                                       12
<PAGE>

Revenues are generated from our administrative services including accounting,
billing and collection, claims processing and information management and from
our physical therapy and rehabilitation business. Revenues for the year ended
December 31, 2003 were $3,327,852 as compared to revenues for the year ended
December 31, 2002 of $3,220,104.. The increase was primarily due to revenues of
$2,480,717 from the core business compared to $3,145,504 in 2002 revenues of
$643,400 from our physical therapy business compared to $74,600 in 2002, and new
revenues of $203,735 from three of the acquired companies in 2003, as we shifted
our focus towards these new segments.

Operating results for 2003 were materially impacted by the start-up costs for
the several acquisitions that were consummated during 2002 and 2003, including
Florida HealthSource, IBX Transcription, NurseStat and MediCompliant, while the
core business also recorded a loss due to expenses in closing the Jacksonville
facility and marketing expenses. iBX expects that these new businesses will have
substantially increased revenues and lower expenses in 2004. Approximately 80%
of our operating expenses related to the healthcare transaction management and
technology services; and physical therapy and rehabilitation services while
approximately 85% of the expenses related to that segment.

Salaries and payroll taxes were $2,244,040 for 2003 as compared to $1,300,563
for 2002. Salaries, which consist of salaried and hourly employees, include
staff used for our administrative services, our technical development staff,
marketing staff and office personnel. Overall our salary and payroll expense
increased $943,477. During 2003 we increased our employees from 29 to 47.

Depreciation and amortization expense for 2003 was $172,374 as compared to
$115,826 for 2002 due to an increase in depreciable assets from additions
primarily in the Company's subsidiary, FHS and NurseStat. We regularly review
the carrying value of our assets and a loss is recognized when the unamortized
costs are deemed unrecoverable based on the estimated cash flows to be generated
from the applicable assets. During the fourth quarter of 2003, we recognized an
impairment charge of $592,604 primarily from the NurseStat, Florida Health, IBX
Transcription Services and Theratouch transactions due to the level of revenues
and cash flows from these businesses in 2003.

Professional fees were $274,185 for the year ended December 31, 2003 as compared
to $191,106 for the year ended December 31, 2002. The increase was attributable
to higher legal and accounting fees as a result of the acquisition activity and
increased reporting applicable to public companies.

Rent expense was $446,829 for the year ended December 31, 2003 as compared to
$230,275 for the year ended December 31, 2002. The increase related to the new
leases for the Florida Health Source facilities and the remainder for scheduled
rent increases in existing facilities. We have offset our rent expense by
subleasing office space to certain entities on a month-to-month basis. Due to
our growth and need for additional space, reductions in rent expense due to
sublease income has decreased.

Other selling, general and administrative expenses, which include contract
labor, travel and entertainment, insurance, provider expenses and other
expenses, were $1,761,613 for the year ended December 31, 2003 as compared to
$1,077,836 for the year ended December 31, 2002. The increase was primarily due
to marketing expenses and additional personnel as operations expanded.
Additional increases were attributable to increased advertising, health
insurance expense, and commissions offset by a decrease in outside services and
other expenses due to cost cutting measures. The physical therapy and
rehabilitation services segment did not exist in the prior period.

Consulting expense was $1,080,018 in 2003 compared to $0 in 2002. This amount
primarily consisted of one-time expenses relating to the issuance of stock and
fees for exercise of warrants. It is expected that this amount will
substantially decrease in 2004.

Total expenses from operations in 2003 were $6,571,633 compared to $2,915,606 in
2003. Loss from operations for 2003 was $3,243,811 compared to income from
operations of $304,498 in 2002.

During 2002, we recognized a gain on settlement of debt of $289,662 for our loan
to Dudziak as part the loan described below.

Interest expense was $354,742 for the year ended December 31, 2003 as compared
to $430,867 for the year ended December 31, 2002. The decrease was attributable
to the fact that we renegotiated our primary loan to more

                                       13
<PAGE>

favorable terms in October 2002, reducing our interest rate from 25% to 12.5%
and had a lower principal amount outstanding in 2003 as we paid down principal.
Additionally, we entered into an installment agreement with the U.S. Internal
Revenue Service (IRS) in October 2002 relating to unpaid payroll taxes. In
connection with this installment agreement, interest expense related to the
unpaid payroll taxes has decreased

As a result of these factors, we reported a net loss of $3,598,563 for the year
ended December 31, 2003 as compared to net income of $163,293 or $nil per share
for the year ended December 31, 2002.

LIQUIDITY AND CAPITAL RESOURCES

During the first part of 2002, our overall performance continued to be hampered
due to continuing inadequacy of funding to meet our needs to, among other
things, ramp up sales and deploy our services. During the second half of 2002,
we received a $500,000 payment from Hilco Receivables LLC for services and
received $79,000 in cash from the exercise of warrants. In 2003, we received
approximately $56,000 from Hilco and $3,088,428 in proceeds from the exercise of
our warrants. Our ability to continue as a going concern is dependent upon our
ability to attain a satisfactory level of profitability, have access to suitable
financing, satisfy our contractual obligations with creditors on a timely basis
and develop further revenue sources.

At December 31, 2003, we had a stockholders' deficit of $1,581,708. We have an
accumulated deficit from losses of $6,413,941. Our operations and growth during
2003 have been funded from loans from third parties amounting to $412,278,
exercises of warrants aggregating $3,088,428 offset by loan repayments of
$516,421. These funds were used for working capital and capital expenditures.

We entered into an installment agreement with the U.S. Internal Revenue Service
in October 2002 relating to unpaid payroll taxes, which requires us to pay
$12,000 per month for 84 months. At December 31, 2003, accrued payroll taxes and
estimated accrued interest and penalties aggregated $1,538,609.

We have no other material commitments for capital expenditures. Other than cash
generated from our operations, exercise of warrants, the sale of securities and
loans and advances from shareholders, we have no external sources of liquidity.
During 2003, 41,137,634 warrants were exercised providing $3,088,428 of cash.
During 2003, as our stock price decreased below the exercise price of $.10, we
lowered the exercise prices of certain of our warrants in order to raise
capital.

We may not have sufficient cash flow from operations to sufficiently meet all of
our cash requirements for the next 12 months. Our future operations and growth
is dependent on our ability to raise capital for expansion, and to seek
additional revenue sources. We have no material commitments for capital
expenditures.

Net cash used in operations during the year ended December 31, 2003 was
$(2,467,550) as compared net cash used in operations of $(495,796) in 2001. The
increase in cash used was primarily a result of net losses in 2003, increases in
accounts receivable, the increase in payroll taxes payable and related interest
and increases in deferred revenues.

Net cash used in investing activities during the year ended December 31, 2003
was $(582,966) compared to net cash used in investing activities of $(124,054)
for the year ended December 31, 2002. The increase was primarily related to the
purchase of additional equipment of $163,083, and an increase in restricted cash
of $438,091.

Net cash provided by financing activities for the year ended December 31, 2003
was $3,049,345 as compared to net cash used in financing activities of $350,629
for the year ended December 31, 2002. The proceeds in 2003 include $3088,428
from the exercise of warrants and loans from third parties amounting to
$412,278, offset by loan repayments of $516,421. The proceeds in 2002 included
$79,000 from the exercises of warrants and proceeds of $163,000 from loans. iBX
also made payments of $293,782 on loans, payments of $189,676 on related party
loans and had cash overdrafts of $109,171 in 2002.

During 2003, we entered into a line of credit agreement with a financial
institution pursuant to which we can borrow up to $425,000. Interest is payable
on the outstanding principal balance by adding the prevailing base loan rate
charged by the financial institution and the sliding scale percentage rate,
determined by the level of the daily net loan balance ranging from 2.5% to .75%
over the base loan rate. The loan is payable

                                       14
<PAGE>

on demand at December 31, 2003 $412,278 was outstanding. The line is secured by
US Treasury securities owned by iBX, which is reflected as retricted cash.

We are currently increasing our marketing efforts and sales force and are
aggressively seeking new clients. We believe that our working capital will
improve as our profitability improves and as we settle certain debt.
Nevertheless, we can provide no assurance as to our future profitability, access
to capital markets, or successful re-negotiation of existing debt.

We may not have sufficient cash flow from operations to sufficiently meet all of
our cash requirements for the next 12 months. Our ability to continue as a going
concern is dependent upon our ability to attain a satisfactory level of
profitability, have access to suitable financing, satisfy our contractual
obligations with creditors on a timely basis and develop further revenue
sources. In September 2003, we modified certain warrants related to 20,000,000
shares of our common stock, issuable upon the exercise of currently outstanding
warrants. The warrants had an exercise price of $.20 per warrant and an
expiration date of June 24, 2003. The expiration date was extended to June 24,
2004 and the exercise price was lowered to $.10 per share. During the last
quarter of 2003, the exercise price was further lowered to $.05 and all of the
warrants were exercised.

In February 2004, we issued two convertible notes in the aggregate amount of
$374,000. We also sold $100,000 of units consisting of shares of convertible
preferred stock and warrants, converted $245,000 of liabilities into these units
and 20,000,000 warrants and approximately $225,000 of liabilities into a
convertible note and 20,000,000 warrants.

CONTRACTUAL OBLIGATIONS AND COMMERCIAL COMMITMENTS

The following tables summarize our contractual obligations and commercial
commitments as of December 31, 2003:
<TABLE>
<CAPTION>
 Significant Capital Obligations         Total       Within 1 Year     2-3 Years     4-5 Years     After 5 Years
 -------------------------------      ----------     -------------     ---------     ---------     -------------
<S>                                   <C>               <C>             <C>           <C>              <C>
 Capital Leases                       $        -        $      -        $      -      $      -         $     -
 Operating Leases                     $1,026,000        $357,000        $436,000      $134,000         $99,000
</TABLE>
CRITICAL ACCOUNTING POLICIES

A summary of significant accounting policies is included in Note 1 to the
audited financial statements included in this Annual Report on Form 10-KSB. We
believe that the application of these policies on a consistent basis enables us
to provide useful and reliable financial information about our operating results
and financial condition.

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

We believe the following critical accounting policies affect our more
significant judgments and estimates used in the preparation of our consolidated
financial statements.

REVENUE RECOGNITION

The Company follows the guidance of the Securities and Exchange Commision's
Staff Accounting Bulletin 101 for revenue recognition. In general, the Company
records revenue when persuasive evidence of an arrangement exists, services have
been rendered or product delivery has occurred, the sales price to the customer
is fixed or determinable, and collectability is reasonably assured. The
following policies reflect specific criteria for the various revenues streams of
the Company:

Revenue derived from billing and collections and administrative services is
recognized at the completion of the service performed. For billing and
collection services, the Company receives a commission from the customer based
on a percentage of amounts actually collected. Revenues are recognized as a net
amount equal to the percentage commission once the customer's receivable had
been received. Software application revenue (from licensing) is recognized in
accordance with the terms of the specific agreements.

                                       15
<PAGE>

Maintenance and support revenues are recognized over the term of the related
agreements.

The Company's FHS subsidiary primarily acts as a referral network for physical
therapy patients who are referred by insurance carriers. Revenue from providing
physical therapy services was recognized upon completion of the patient services
and was recorded net of amounts due to service providers for the fiscal year
ended December 31, 2002. In 2003, the Company re-evaluated this revenue
recognition policy of the FHS subsidiary and determined that it qualifies for
the use of the Gross Method under EITF 99-19, "Recording Revenues Gross as a
Principal versus Net as an Agent". The cumulative effect of the change in
accounting principal was not material.

Revenues from providing medical staffing application services will be recognized
as services are provided.

Customer prepayments from outsourced legal compliance services are deferred and
recognized as earned over the service period.

STOCK-BASED COMPENSATION

The Company accounts for stock options issued to employees in accordance with
the provisions of Accounting Principles Board ("APB") Opinion No. 25,
"Accounting for Stock Issued to Employees," and related interpretations. As
such, compensation cost is measured on the date of grant as the excess of the
current market price of the underlying stock over the exercise price. Such
compensation amounts are amortized over the respective vesting periods of the
option grant. The Company adopted the disclosure provisions of SFAS No. 123,
"Accounting for Stock-Based Compensation," which permits entities to provide pro
forma net income (loss) and pro forma earnings (loss) per share disclosures for
employee stock option grants as if the fair-valued based method defined in SFAS
No. 123 had been applied.

The Company accounts for stock options and stock issued to non-employees for
goods or services in accordance with the fair value method of SFAS 123.

RECENT PRONOUNCEMENTS

In December 2002, the FASB issued Statement of Financial Accounting Standards
No. 148, Accounting for Stock-Based Compensation - Transition and Disclosure.
Statement 148 provides alternative methods of transition to Statement 123's fair
value method of accounting for stock-based employee compensation. It also amends
the disclosure provisions of Statement 123 and APB Opinion No. 28, Interim
Financial Reporting, to require disclosure in the summary of significant
accounting policies of the effects of an entity's accounting with respect to
stock-based employee compensation on reported net income and earnings per share
in annual and interim financial statements. Statement 148's amendment of the
transition and annual disclosure requirements of Statement's 123 are effective
for fiscal years ending after December 15, 2002. Statement 148's amendment of
the disclosure requirements of Opinion 28 is effective for interim periods
beginning after December 15, 2002.

In January 2003, the EITF finalized a consensus on Issue No. 02-16, "Accounting
by a Customer (Including a Reseller) for Cash Consideration Received from a
Vendor." The Task Force concluded that cash consideration in excess of specific
identifiable costs, including sales incentives, allowances, discounts, coupons,
rebates and price reductions, when meeting certain criteria, constitute a
reduction in vendor price, and should therefore be reflected as a reduction in
cost of sales when the related merchandise is sold. The EITF concluded that this
literature should be applied to new arrangements, including modifications of
existing arrangements, entered into after December 31, 2002. We adopted EITF
02-16 as of January 1, 2003. The adoption of EITF 02-16 had an immaterial impact
on our consolidated financial position and results of operations.

In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain Financial
Instruments with Characteristics of Both Liabilities and Equity." This statement
establishes standards for how an issuer classifies and measures certain
financial instruments with characteristics of both liabilities and equity. This
statement is effective for financial instruments entered into or modified after
May 31, 2003, and otherwise is effective for the first interim period beginning
after June 15, 2003, with certain exceptions. The adoption of SFAS No. 150 did
not have a significant impact on our consolidated financial position or results
of operations.

                                       16
<PAGE>

FACTORS THAT MAY AFFECT FUTURE RESULTS

You should carefully consider the following risks in evaluating IBX. The risks
described below are not the only ones that we face. Additional risks that we do
not yet know of or that we currently think are immaterial may also impair our
business operations. Our business, operating results or financial condition
could be materially adversely affected by any of the following risks. The
trading price of our common stock could decline due to any of these risks, and
you may lose all or part of your investment. You should also refer to the other
information set forth in this Report, including our financial statements and the
related notes.

IBX cautions readers that certain important factors may affect IBX's actual
results and could cause those results to differ significantly from any
forward-looking statements made in this report or otherwise made by or on behalf
of IBX.

WE HAVE NEGATIVE WORKING CAPITAL. We had a negative working capital of
$1,900,961 at December 31, 2003 and continue to need cash for operations.

WE REPORTED A LOSS FOR 2003. For the year ended December 31, 2003. we had a net
loss of $3,598,563 compared to net income of $163,293 for the year ended
December 31, 2002, primarily due to increased marketing expenses and losses at
our Jacksonville facilities that have since been closed.

OUR ACCOUNTANTS HAVE ISSUED A GOING CONCERN OPINION DUE TO THE LACK OF CAPITAL.
Because of the uncertainties in its ability to satisfy its future capital needs,
our auditors' report on its financial statements for the year ended December 31,
2003 contains an explanatory paragraph about its ability to continue as a going
concern.

WE NEED ADDITIONAL CAPITAL TO BE SUCCESSFUL, WHICH WILL POTENTIALLY DILUTE THE
VALUE OF SHARES OF SHAREHOLDERS. We need substantial capital to execute our
business plan. To finance our operations to date, we have relied on private
offerings, exercises of warrants and loans. During 2003, we issued an aggregate
of 43,230,234 shares of common stock to finance our operations. We will issue
additional shares if all of the outstanding preferred stock is converted and all
warrants exercised. The terms on which we obtains additional financing,
including the exercise of the outstanding warrants may dilute the existing
shareholders investments, or otherwise adversely affect its position. It is also
possible that we will be unable to obtain the additional funding we need as and
when we need it. If we were unable to obtain additional funding as and when
needed, we could be forced to curtail our operations.

OUR ASSETS ARE SUBJECT TO A LIEN, AND IF JUDGMENTS ARE ENTERED AND ENFORCED, IT
MAY SHUT DOWN OUR OPERATIONS. We have granted a lien on all of our assets in
connection with a financing transaction. We are current in the repayment
obligation and as of March 12, 2004 owed this creditor $80,000. Upon the
repayment to this creditor, we have pledged these assets to another creditor.
Unless we are successful in repaying this obligation, our business may be shut
down if these creditors are able to collect on their judgments.

WE ISSUED UNREGISTERED SHARES THAT MAY HAVE VIOLATED SECTION 5 OF THE SECURITIES
ACT OF 1933. In December 2003 and January 2004, we issued an aggregate of
2,972,366 shares without any restrictive legend. Since an effective registration
statement may not have been in effect for these shares, these issuances may have
violated Section 5 of the Securities Act of 1933. iBX is currently exploring
appropriate corrective actions.

THERE ARE MANY COMPETITORS IN THE OUR MARKETS AND WE MAY NOT BE ABLE TO COMPETE
EFFECTIVELY AGAINST THEM. There are many companies that compete with us in both
transaction management and physical therapy/rehab businesses. Many of these
companies compete with us for hospitals and medical practices, which are our
primary customers. We expect competition to continue to increase as there are no
substantial barriers to entry in our market. Increased competition could result
in reductions in the fees we receive for our services, lower margins or loss of
clients. Any of these occurrences could materially and adversely affect our
business, financial condition and results of operations. Competition is also
likely to increase significantly, not only as new entities enter the market, but
also as current competitors expand their services.

Our ability to compete depends on a number of factors, many of which are outside
of our control. These factors include ease of use, timing and market acceptance
of new and enhanced services, and level of sales and marketing efforts.

                                       17
<PAGE>

Many of our existing competitors, as well as a number of potential new
competitors, have longer operating histories, greater name recognition, existing
relationships with pharmaceutical and other healthcare companies and
significantly greater financial, technical and marketing resources than we do.
This may allow them to devote greater resources than we can to the development
and promotion of their services. These competitors may also engage in more
extensive development efforts, undertake more far-reaching marketing campaigns
and adopt more aggressive pricing policies. Our competitors may develop services
that are equal or superior to those we provide or that achieve greater market
acceptance and brand recognition than we achieve. We may not be able to compete
successfully or competitive pressures may have a material adverse effect on our
business, results of operations and financial condition.

OUR BUSINESS HAS BEEN CONCENTRATED WITH A FEW CUSTOMERS AND SUPPLIERS. For the
year ended December 31, 2003, our three largest customers accounted for an
aggregate of 19% of revenues and 52% of accounts receivable. Consequently, our
success is materially dependent on our relationship with these customers and
their continued viability.

OUR SUCCESS IS BASED ON INCREASING DEMAND FOR OUR PRODUCTS AND SERVICES. We
depend on the continued demand for outsourcing of health information technology
services, on the growing use of the Internet for healthcare commerce and
communication and on favorable general economic conditions. We cannot assure you
that our business strategy will be successful or that we will successfully
address these risks or difficulties. If we should fail to adequately address any
of these risks or difficulties, our business would likely suffer.

THE SUCCESS OF OUR NEW PHYSICAL THERAPY REHABILITATION CENTERS IS HIGHLY
DEPENDENT ON REIMBURSEMENT FROM THIRD-PARTY PAYORS. Substantially all of our
revenues are derived from private and governmental third-party payors such as
Medicare, Medicaid, commercial insurers, managed care plans, workers'
compensation payors and other private pay revenue sources. There are increasing
pressures from many payors to control healthcare costs and to reduce or limit
increases in reimbursement rates for medical services. There can be no
assurances that payments from government or private payors will remain at levels
comparable to present levels. In attempts to limit federal spending, there have
been, and we expect that there will continue to be, a number of proposals to
limit Medicare reimbursement for various services. We cannot now predict whether
any of these pending proposals will be adopted or what effect the adoption of
such proposals would have on our business.

OUR NEW PHYSICAL THERAPY/REHABILITATION BUSINESS IS SUBJECT TO EXTENSIVE FEDERAL
AND STATE REGULATION THAT CAN AFFECT OUR OPERATIONS. Our business is subject to
extensive federal and state regulation with respect to financial relationships
among healthcare providers, physician self-referral arrangements and other fraud
and abuse issues. Penalties for violation of federal and state laws and
regulations include exclusion from participation in the Medicare and Medicaid
programs, asset forfeiture, civil penalties and criminal penalties, any of which
could have a material adverse effect on our business, results of operations or
financial condition. The Office of Inspector General of the Department of Health
and Human Services, the Department of Justice and other federal agencies
interpret healthcare fraud and abuse provisions liberally and enforce them
aggressively.

WE NEED TO INSURE THAT OUR CUSTOMER DATA THAT IS TRANSMITTED ONLINE IS SECURE. A
significant part of our business is involves transmitting patient and other
healthcare-related data online. Our customers are required to comply with
federal and state regulations relating to this data. If a compromise of security
were to occur, it could have a material adverse effect on our reputation,
business, prospects, financial condition and results of operations. We may be
required to expend significant capital and other resources to protect against
such security breaches or to alleviate problems caused by such breaches. To the
extent that our activities involve the storage and transmission of proprietary
information, security breaches could damage our reputation and expose it to a
risk of loss or litigation and possible liability. There can be no assurance
that our security measures will prevent security breaches or that failure to
prevent such security breaches will not have a material adverse effect on our
business, prospects, financial condition and results of operations.

                                       18
<PAGE>

WE RELY ON OUR SENIOR MANAGEMENT AND WILL BE HARMED IF ANY OR ALL OF THEM LEAVE.
Our success is dependent on the efforts, experience and relationships of Evan R.
Brovenick, David Blechman, Alvin Brovenick, and other essential staff. If any of
these individuals become unable to continue in their role, our business or
prospects could be adversely affected. Although we have entered into an
employment agreement with each of our executive officers, we cannot assure you
that such individuals will continue in their present capacity for any particular
period of time.

FLUCTUATIONS IN OUR OPERATING RESULTS MAY ADVERSELY AFFECT OUR STOCK PRICE AND
PURCHASERS OF OUR SHARES OF COMMON STOCK MAY LOSE ALL OR A PORTION OF THEIR
INVESTMENT. Historically, there has been volatility in the market price for our
common stock. Our quarterly operating results, the number of shareholders
desiring to sell their share, changes in general conditions in the economy, the
financial markets or the healthcare industry, or other developments affecting us
or our competitors, could cause the market price of our common stock to
fluctuate substantially. We expect to experience significant fluctuations in our
future quarterly operating results due to a variety of factors. Factors that may
adversely affect our quarterly operating results include:

   o  the announcement or introduction of new products by us and our
      competitors;
   o  our ability to retain existing clients and attract new clients at a steady
      rate, and maintain client satisfaction;
   o  the amount and timing of operating costs and capital expenditures relating
      to expansion of our business and operations;
   o  government regulation; and
   o  general economic conditions and economic conditions specific to the
      healthcare industry.

As a result of these factors, in one or more future quarters, our operating
results may fall below the expectations of securities analysts and investors. In
this event, the market price of our common stock would likely be materially
adversely affected.

IF THE SELLING SHAREHOLDERS ALL ELECT TO SELL THEIR SHARES OF OUR COMMON STOCK
AT THE SAME TIME, THE MARKET PRICE OF OUR SHARES MAY DECREASE. It is possible
that the selling shareholders will offer all of the shares for sale. Further,
because it is possible that a significant number of shares could be sold at the
same time, the sales, or the possibility thereof, may have a depressive effect
on the market price of our common stock.

BECAUSE OUR STOCK CURRENTLY TRADES BELOW $5.00 PER SHARE, AND IS QUOTED ON THE
OTC BULLETIN BOARD, OUR STOCK IS CONSIDERED A "PENNY STOCK" WHICH CAN ADVERSELY
EFFECT ITS LIQUIDITY. OUR COMMON STOCK DOES NOT CURRENTLY QUALIFY FOR LISTING ON
THE NASDAQ STOCK MARKET AND WE DO NOT FORESEE THAT WE WILL QUALIFY FOR SUCH A
LISTING IN THE FORESEEABLE FUTURE. If our common stock continues to be quoted on
the OTC Bulletin Board, and the trading price of our common stock remains less
than $5.00 per share, our common stock is considered a "penny stock," and
trading in our common stock is subject to the requirements of Rule 15g-9 under
the Securities Exchange Act of 1934. Under this rule, broker/dealers who
recommend low-priced securities to persons other than established customers and
accredited investors must satisfy special sales practice requirements. The
broker/dealer must make an individualized written suitability determination for
the purchaser and receive the purchaser's written consent prior to the
transaction.

SEC regulations also require additional disclosure in connection with any trades
involving a "penny stock," including the delivery, prior to any penny stock
transaction, of a disclosure schedule explaining the penny stock market and its
associated risks. These requirements severely limit the liquidity of securities
in the secondary market because few broker or dealers are likely to undertake
these compliance activities. In addition to the applicability of the penny stock
rules, other risks associated with trading in penny stocks could also be price
fluctuations and the lack of a liquid market.

WE NEED TO AMEND OUR ARTICLES OF INCORPORATION TO AUTHORIZE ADDITIONAL COMMON
STOCK. Our articles of incorporation currently authorize 100,000,000 shares of
common stock. In order to provide for the issuance of sufficient shares for
conversion of outstanding preferred stock and exercise of warrants, we need to
amend our articles to provide for additional authorized shares. We intend to
hold a shareholders meeting to approve such an amendment. However our management
and principal shareholders do not have voting control of a sufficient number of
shares to approve such an amendment.

                                       19
<PAGE>

ITEM 7.  FINANCIAL STATEMENTS

The Financial Statements are located after the signature page.

ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

None

ITEM 8A. CONTROLS AND PROCEDURES

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES. Our management evaluated, with
the participation of our Chief Executive Officer and our Chief Financial
Officer, the effectiveness of our disclosure controls and procedures as of the
end of the period covered by this Annual Report on Form 10-KSB. Based on this
evaluation, our Chief Executive Officer and our Chief Financial Officer have
concluded that our disclosure controls and procedures are effective to ensure
that information we are required to disclose in reports that we file or submit
under the Securities Exchange Act of 1934 is recorded, processed, summarized and
reported within the time periods specified in Securities and Exchange Commission
rules and forms.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING. There was no change in our
internal control over financial reporting that occurred during the last fiscal
quarter covered by this Annual Report on Form 10-KSB that has materially
affected, or is reasonably likely to materially affect, our internal control
over financial reporting.

                                    PART III

ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
         COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT

DIRECTORS AND EXECUTIVE OFFICERS

The following persons are members of our board of directors and executive
officers, in the capacities indicated:

 NAME                       AGE       POSITION
 ----                       ---       --------
 Evan Brovenick             43        Chairman of the Board, President
                                       and Chief Executive Officer
 David Blechman             53        Vice President, Secretary and Director
 Alvin Brovenick            73        Director
 Mitchell Hershey           45        Director

EVAN R. BROVENICK has been chairman of the board, president and chief executive
officer since the acquisition of PriMed in September 2001 and was a founder and
president and chief executive officer of PriMed and its predecessors since its
inception in 1999. From January 1994 until March 1999, Mr. Brovenick served as
the director of marketing and business development for ManageMed, a healthcare
services company .

DAVID J. BLECHMAN has been vice president and secretary, since the acquisition
of PriMed in September 2001 and was a founder and president and chief executive
officer of PriMed and its predecessors since its inception in 1999. From January
1994 until March 1999, Mr. Blechman served as the director of technical services
for ManageMed from January 1994 until March 1999.

ALVIN BROVENICK has served as a member of PriMed's board of directors since its
inception. Mr. Brovenick served materially similar roles with PriMed LC prior to
its merger with PriMed. During the immediately preceding five years, in addition
to his roles with PriMed and its predecessors, Mr. Brovenick served as the
treasurer of ManageMed. He is the father of Evan Brovenick, PriMed's founder and
president and is employed as a management consultant by IBX. Mr. Brovenick is a
retired certified public accountant.

MITCHELL HERSHEY is currently the Director of Field Operations for the 20th
largest advertising agency in the USA, Zimmerman & Partners, Fort Lauderdale,
Florida. Prior to this position which he has held for the past two years, Mr.
Hershey spent1996-2000 at Saatchi & Saatchi Advertising, New York, the third
largest advertising agency in the USA, as General Manager for Toyota Motors,
USA. Previous positions have included advertising and marketing for corporations
like Proctor & Gamble, General Mills, Dr. Pepper, Hertz, Budget Rent A Car, RJ
Reynolds, Hueblein, Pabst Brewing and Club Med. Mr. Hershey holds an MBA in
Marketing from Pace University in New York City and a B.S. in Management from
the University of Florida.
                                       20
<PAGE>

The directors hold office until the next annual meeting of the shareholders and
until there successors have been duly elected or qualified.

COMMITTEES

There is currently no audit committee since there is only one independent
director, Mitchell Hershey, who does not qualify as a financial expert. The
board of directors will form an audit committee at such time as there are at
least two independent directors.

ITEM 10. EXECUTIVE COMPENSATION

The following tables summarize the total compensation paid to Evan Brovenick,
our chief executive officer and the other executive offers with compensation of
at least $100,000 in 2003.
<TABLE>
                                       Summary Compensation Table
<CAPTION>
                                      Annual Compensation                    Long-Term Compensation
                          ---------------------------------------------   -----------------------------
                                                            Other         Restricted    Securities
 Name and                                                   Annual           Stock       Underlying
 Principal Position       Year   Salary ($)    Bonus    Compensation(1)   Awards ($)   Options/SARs (#)
 ----------------------   ----   ----------   -------   ---------------   ----------   ----------------
<S>                       <C>     <C>         <C>          <C>            <C>            <C>
 Evan Brovenick           2003    $125,000    $87,000      $12,586        $14,700(2)          -
    President and Chief   2002     125,000       -          15,476         14,000(3)          -
    Executive Officer     2001     100,000       -          15,000             -              -

 David Blechman           2003    $125,000    $  -         $ 7,996             -              -
    Vice President        2002     125,000       -          12,359             -              -
                          2001     100,000       -          15,000             -              -
</TABLE>
 ----------
 (1) Includes car allowance, health coverage and life insurance.
 (2) Represents 210,000 shares valued at $.07 per share.
 (3) Represents 200,000 shares valued at $.07 per share.

GRANTS OF STOCK OPTIONS

No options were granted to the executive officers named above in 2002 or 2003
and none are currently outstanding.

COMPENSATION OF DIRECTORS

We do not currently pay any compensation to our outside directors.

EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE IN CONTROL
ARRANGEMENTS.

On December 19, 2001, we entered into an employment agreement with Evan
Brovenick for a period ending on December 31, 2006. Mr. Brovenick's
responsibilities involve all services, acts, or things necessary or advisable to
serve as its president and chief executive officer including but not limited to
assist in establishing our policies and strategic planning, identify potential
acquisition candidates, assist in financial planning and capital formation and
oversee our day to day operations.

As compensation for his services, Mr. Brovenick will receive in 2003 an annual
base compensation of $125,000. Subject to board approval, the annual base salary
in each succeeding year will be equal to at least 110% of the annual base salary
from the prior year.

In addition to the monthly compensation, Mr. Brovenick was issued 6,600,000
shares of our common stock, that vest only if during the term of Mr. Brovenick's
employment, we have a net pre-tax profit of at least one dollar as determined by
our year-end audited financial statements. Until such time as the shares have
vested, Mr. Brovenick will have no right to vote the shares nor may he have the
right to pledge, encumber, hypothecate or in any way transfer the shares. These
shares vested as a result of the 2002 financial results.

                                       21
<PAGE>

Mr. Brovenick will also be entitled to such other bonuses based upon our
performance as determined in the sole and absolute discretion of the board of
directors; will be offered health insurance coverage at no cost; be entitled to
participate in such employee benefit programs as are offered to other employees;
and be entitled to annual paid vacation Mr. Brovenick will also be reimbursed
for out-of-pocket expenses incurred by him in the performance of his duties.

We have the right to terminate the agreement for good cause or by reason of Mr.
Brovenick's disability on 30 days' prior written notice to Mr. Brovenick. As
used in the agreement, disability means Mr. Brovenick's inability caused by
mental or physical illness to satisfactory perform his obligations and duties
hereunder for a consecutive period in excess of 120 days during the term of the
agreement or for a period of 180 out of a total of 360 work days; and, good
cause means any breach by Mr. Brovenick of his obligations under the agreement,
habitual neglect of duties, continued incapacity or inability to perform the
obligations set forth in the agreement or the conviction of any felony. If Mr.
Brovenick is terminated for any other reason than good cause, we will be
obligated to pay Mr. Brovenick a severance payment of the greater of $100,000 or
the remaining sums due under the agreement. The agreement also contains
non-competition and confidentiality provisions.

David Blechman's agreement is identical to Mr. Brovenick's except that he has
not been granted any restricted stock.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
         RELATED STOCKHOLDER MATTERS

The following tables disclose information concerning ownership of common stock
by officers, directors and holders of 5% or more of our common stock. Our
currently outstanding shares of common stock, for purposes of these
calculations, are calculated based on information available as of March 12, 2004
and include both currently outstanding securities and securities which a named
person has a right to acquire within 60 days following the date of this
prospectus.

                                        Amount and Nature of
 Name and Address of Beneficial Owner   Beneficial Ownership    Percent of Class
 ------------------------------------   --------------------    ----------------
 Evan Brovenick                             16,040,500 (1)           16.3%
 David Blechman                              4,555,500 (2)            4.6
 Tucker Family Spendthrift Trust             3,949,501 (3)            4.1
 Calvo Family Spendthrift Trust              5,700,689 (4)            5.6
 Alvin Brovenick                                     0                 -
 Mitchell Hershey                                    0                 -
 Northbar Capital                              500,000 (5)             *
 Big Time Capital Group                     20,000,000 (6)           17.2
 Jericho State Capital Corp. of Florida     28,000,000 (7)           22.5
 All  officers  and  directors as a
  group (4 persons)                         20,577,790               20.1
 -----------
 *   Less than 1%.

(1)  Includes 14,040,500 shares and 2,000,000 shares issuable upon exercise of
     outstanding warrants.

(2)  Includes 2,455,500 shares of common stock, 1,400,000 shares issuable upon
     conversion of outstanding Series B preferred stock and 700,000 shares of
     common stock issuable upon exercise of warrants.

(3)  The Tucker family is comprised of Michelle Tucker, Leonard Miles Tucker,
     her husband, and their minor daughters Shayna and Montana. Includes
     1,857,001 shares and 2,092,500 shares owned by Blue Lake Capital Corp.,
     which is owned by members of the Tucker family. Does not include shares
     that may be issued upon conversion of the $174,000 note described below.

(4)  The Calvo family is comprised of Cyndi Calvo; William A. Calvo, III, her
     husband; William, Alexander and Edward, their minor sons. All the shares
     are held by the Calvo Family Spendthrift Trust. Includes shares issuable
     upon conversion of preferred stock. Excludes 33,000 shares of Class A
     Nonvoting Convertible Preferred Stock that are convertible into 3,300,000
     shares of common stock subject to certain restrictions, which common shares
     are included above. The terms of the Preferred Stock prohibit the holder
     from owning more than 4.9% of the outstanding voting stock at any time.
     Accordingly, the Trust is unlikely to ever hold the number of shares set
     forth above at any time.

                                       22
<PAGE>

(5)  Includes common stock owned. Does not include shares that may be issued
     upon conversion of $200,000 of notes.

(6)  Does not include shares that may be issued upon conversion of $200,000 of
     notes.

(7)  Includes shares issuable upon conversion of preferred stock and exercise of
     warrants.

STOCK SELLING PLAN

Evan Brovenick and David Blechman's shares in iBX have been pledged to secure
the repayment of iBX's obligations to Bill Dudziak. They have each advised us
that he has entered into a written stock selling plan in accordance with SEC
Rule 10b5-1 pursuant to which he has been gradually liquidate a portion of his
holdings in the Company. The proceeds of any sales were held in escrow and to
secure in part the repayment of iBX's obligations to Bill Dudziak. From time to
time, funds have been removed from escrow and paid to Mr. Dudziak to reduce
iBX's obligations. At such time as the Dudziak obligation is repaid in full by
iBX, any escrowed funds and shares will be released to Messrs. Brovenick and
Blechman. The plans calls for weekly sales of stock of up to 100,000 shares for
Mr. Brovenick and 100,000 shares for Mr. Blechman, with the amounts dependent
upon the prevailing market price. Selling according to this plan will end when
Mr. Brovenick has sold 1,000,000 shares and Mr. Blechman 500,000 shares, unless
the plan is terminated earlier. Other than as set forth above, Messrs. Brovenick
and Blechman have not sold any shares of iBX Common Stock and have stated they
have no present intention to do so.

EQUITY COMPENSATION PLAN

The following table provides information about our common stock that may be
issued upon the exercise of options, warrants and rights under all of our
existing equity compensation plans as of December 31, 2003
<TABLE>
<CAPTION>
                                       Number of        Weighted-average      Number of securities
                                   securities to be      exercise price     remaining available for
                                      issued upon        of outstanding      future issuance under
                                      exercise of           options,          equity compensation
                                      outstanding         warrants and         plans (excluding
                                   options, warrants         rights         securities reflected in
                                      and rights              (b)                 column (a))
         Plan Category                    (a)                                         (c)
         -------------             -----------------    ----------------    -----------------------
<S>                                        <C>               <C>                   <C>
Equity compensation plans                  0                 $    0                         0
   approved by security holders

Equity compensation plans not
   approved by security holders            0                 $    -                5,000,0000

Total                                      0                 $ 5.00                 5,000,000
</TABLE>

ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Evan Brovenick, our president and chief executive officer, loaned us $93,000 in
2001 and $175,000 in 2000. The 2001 advances have been treated as a contribution
to capital. At December 31, 2002, $454 was outstanding. During 2003 and 2004,
Mr. Brovenick has loaned iBX funds at various times, which have been repaid as
cash flow permitted. iBX never intentionally loaned Mr. Brovenick any funds.
However, at December 31, 2003, there was a balance owed by Mr. Brovenick that
was repaid in early 2004 when Mr. Brovenick loaned funds to iBX. Section 402 of
the Sarbanes Oxley Act of 2002 and Section 13(k) of the Securities Exchange Act
of 1934 make it "unlawful for any issuer, directly or indirectly to extend or
maintain credit in the form of a personal loan to or for any director or
executive officer of that issuer." These advances may constitute a violation of
these laws. As a potential violation may have occurred, Section 307 of Sarbanes
Oxley requires notification of this issue. As the loan has already been repaid
in 2004 and the effects of the potential violation have been reversed, no
further action on the part of iBX is required, other than to employ procedures
designed to ensure that no violations of this type occur in the future.

                                       23
<PAGE>

During 2002, Todd Adelstein and Tammi Shnider, the adult children of Steven
Adelstein, a director, lent us an aggregate of $46,036 for operating expenses.
In May 2002, the $46,036 loan from Mr. Adelstein and Ms. Shnider and $25,000
from an unrelated person was converted into a purchase of restricted stock at a
price of $.10 per share. The Calvo Family Spendthrift Trust and the Tucker
Family Spendthrift Trust each cancelled 425,000 class A warrants as part of this
transaction.

During 2002, the Calvo Family Spendthrift Trust and the Tucker Family
Spendthrift Trust lent us an aggregate of $94,237. This amount was used to
convert 942,366 outstanding warrants.

In May 2002, the Calvo Family Spendthrift Trust and the Tucker Family
Spendthrift Trust each agreed to transfer 425,000 class A warrants to lenders to
IBX.

Effective May 29, 2002, we entered into an Exchange Agreement with the Calvo
Family Spendthrift Trust pursuant to which the trust exchanged 8,000,000 of the
9,682,325 shares of common stock it currently holds for 80,000 shares of the
non-voting class A preferred stock . The agreement provides that the trust
cannot own 5% or more of our voting securities. We determined to enter into the
Exchange Agreement since William A. Calvo, a beneficiary of the trust, recently
was found guilty of violating Section 5 of the Securities Act by reselling, or
by being a necessary or substantial participant in the resale of, unregistered
Systems of Excellence shares and that Diversified Corporate Consulting Group, a
limited liability company of which Mr. Calvo was a member, had violated Section
17(a) of the Securities Act and Section 10(b) of the Exchange Act with respect
to the fraudulent and manipulative trading in Systems of Excellence shares. The
conversion into the class A preferred stock will help us to limit any control
that Mr. Calvo may have over IBX. In 2003, 23,000 shares of this preferred stock
was converted into common stock and in March 2004 24,000 shares were converted.

In April 2003, Irv Freiberg entered into separate agreements with the Tucker
Family Spendthrift Trust and the Calvo Family Spendthrift Trust pursuant to
which he has the right to purchase all of the class A warrants from the Tucker
Family Spendthrift Trust and all of the class E warrants from the Calvo Family
Spendthrift Trust. The Trusts have agreed with Mr. Freiberg to not exercise the
warrants so long as Mr. Freiberg purchases 1,000,000 warrants per month from
each Trust. iBX agreed to pay Brett Finkelstein, a selling shareholder, or his
designees a fee of $.005 per warrant for each warrant that is purchased by Mr.
Freiberg and subsequently exercised. An aggregate of 19,790,000 warrants were
exercised by Mr. Freiberg. IBX paid Mr. Freiberg $550,000 in 2003 for marketing
and consulting services. An entity unaffiliated with Mr. Freiberg also purchased
an aggregate of 13,500,000 warrants from the Trusts on the same terms as Mr.
Freiberg.

As of December 31, 2003, each of the Trusts were deemed to no longer be
affiliates of IBX since their ownership was less than 10% of the outstanding
shares and both parties have waived their rights to designate nominees to the
board of directors. Given that each had also held their shares for over two
years, each Trust was eligible to request that the legend be removed on their
shares and that the shares could be sold without restriction under Rule 144(k).
However, each has agreed that without approval of the chief executive officer of
IBX, that it shall not sell more than 500,000 shares in any calendar month. In
January 2004, the chief executive officer agreed to allow the Tucker Family
Spendthrift Trust to sell 1,000,000 shares in January and February 2004 since
IBX did not pay to the Trust on a timely basis funds owed upon the sale of
warrants.

iBX owed the Tucker Family Spendthrift Trust approximately $74,000 and the Calvo
Family Spendthrift Trust approximately $115,000 with respect to the purchases of
the warrants described above. In March 2004, the Tucker Family Spendthrift Trust
loaned to iBX $100,000 and agreed to convert the $74,000 to iBX on the same
terms. iBX is negoriating payment terms for such amount with the Calvo Family
Spendthrift Trust.

The Tucker note provides for 8% interest, a maturity date of March 12, 2005and a
security interest in all of iBX's assets. iBX is required to provide the holder
with 90 days' notice of any prepayment, although there is no prepayment penalty.
The note is convertible to common stock. The conversion price is the lowest of
$.035, 70% of the closing bid price on the date of conversion or 70% of the
offering price any offering by iBX until March 2005. iBX agreed to include the
shares issuable upon the exercise of this note in a registration statement.

                                       24
<PAGE>

iBX also issued to David Blechman, an officer and director 700 shares of Series
B preferred stock and 700,000 warrants to reimburse him for the $70,000 that was
paid to Dudziak as described above. iBX issued 2,000 shares of Series B
preferred stock and 22,000,000 warrants to Jericho State Capital Corp. of
Florida, or its designee,as payments of amounts owed to it under a consulting
agreement for 2003, 2004 and 2005 and also issued to Big Time Capital Group or
its designee a convertible note in the principal amount of $200,000 and
20,000,000 warrants for payment of accrued fees.

In December 2003 and January 2004, we issued an aggregate of 2,972,366 shares
without any restrictive legend. At the time of issuance, iBX believed that it
was issuing the shares upon exercise of outstanding warrants and that the shares
issuable upon the exercise of these warrants were registered pursuant to a
registration statement then in effect. However, due to an accounting error by
iBX, all of the warrants included in the registration statement had been
exercised. Accordingly, the 2,972,366 shares were issued without a valid
registration statement in effect, which is a violation of Section 5. Since an
effective registration statement was not in effect for these shares, these
issuances may have violated Section 5 of the Securities Act of 1933. iBX is
currently exploring appropriate corrective actions.

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K.

(a)  EXHIBITS

     Exhibit
     Number                              Description
     -------                             -----------
       2.1      Stock Exchange Agreement Dated August 31, 2001 between VidKid
                Distribution, Inc. and PriMed Technologies, Inc. (3)
       3.1      Articles of incorporation (1) (3)
       3.2      Bylaws (1)
       3.3      Certificate of Amendment of Articles of Incorporation (5)
       3.4      Certificate of Amendment of Articles of Incorporation
       10.1     Settlement Agreement dated as of December 19, 2001 (2).
       10.2     Employment Agreement with Evan Brovenick (2)
       10.2     Employment Agreement with David Blechman (4)
       10.4     Conversion Agreement with Calvo Family Spendthrift Trust (5)
       31.1     Certification by the Chief Executive Officer pursuant to
                Section 302 of the Sarbanes-Oxley Act of 2002
       31.2     Certification by the Chief Financial Officer pursuant to
                Section 302 of the Sarbanes-Oxley Act of 2002
       32.1     Certification of CEO and CFO pursuant to 18 U.S.C. Section
                1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
                Act of 2002
     ----------
     (1)  Incorporated by reference to the Company's registration statement on
          Form SB-2 (file no. 333-36666)
     (2)  Incorporated by reference to the Company's Current Report on Form 8-K
          dated December 19, 2001
     (3)  Incorporated by reference to the Company's Current Report on Form 8-K
          dated September 25, 2001
     (4)  Incorporated by reference to the Annual Report on Form 10-KSB for the
          year ended December 31, 2001
     (5)  Incorporated by reference to the Company's Registration Statement on
          Form SB-2 (file no. 333-90660)

(b)  REPORTS ON FORM 8-K

     None

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

AUDIT FEES

For 2003 and 2002, iBX paid to Salberg & Company, P.A. audit fees of
approximately $60,000 and $40,000, respectively, billed for professional
services rendered for the audit of iBX's annual financial statements and the
reviews of the financial statements included in iBX's financial statements
included in its quarterly filings on Form 10-QSB for the respective periods.

                                       25
<PAGE>

AUDIT-RELATED FEES

For 2003 and 2002, iBX paid to Salberg & Company fees of approximately $17,000
and $19,000 respectively, billed for assurance and related services by iBX's
auditors that are reasonably related to the performance of the audit or review
of iBX's financial statements included in iBX's financial statements included in
its quarterly filings on Form 10-QSB for the respective periods. The services
thus provided by iBX's auditors included accounting consultations and review in
connection with registration statements, consultation concerning financial
accounting and reporting standards, and acquisition audits.

TAX FEES

For 2002, iBX paid to Salberg & Company fees of approximately $2,700 billed for
tax compliance, tax advice and tax planning. No such fees were paid in 2003.

ALL OTHER FEES

There were no other fees paid in 2003 or 2002 not identified above.

The iBX board approved 100% of the foregoing services rendered by the auditors.

                                       26
<PAGE>
                                   SIGNATURES

         In accordance with Section 13 or 15(d) of the Securities Exchange Act
of 1934, the Registrant has caused its Annual Report on Form 10-KSB to be signed
on its behalf by the undersigned, thereunto duly authorized.

                                        IBX GROUP, INC.

Date:  March 30, 2004                   By: /s/ Evan Brovenick
                                            -------------------------
                                            Evan Brovenick, President


         In accordance with the Securities Exchange Act of 1934, this report has
been signed below by the following persons on behalf of the Registrant and in
the capacities and on the dates indicated:


       SIGNATURE                      TITLE                            DATE

 /s/ Evan R. Brovenick        Chief Executive Officer,            March 30, 2004
 ---------------------        President and Director
 Evan R. Brovenick

 /s/ David Blechman           Director, Vice President            March 30, 2004
 ------------------           and Secretary
 David Blechman

 /s/ Alvin Brovenick          Director and Acting Chief           March 30, 2004
 -------------------          Financial Officer
 Alvin Brovenick

 /s/ Mitchell Hershey         Director                            March 30, 2004
 --------------------
 Mitchell Hershey

                                       27
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES

                        CONSOLIDATED FINANCIAL STATEMENTS

                  FOR THE YEAR ENDED DECEMBER 31, 2003 AND 2002



                                TABLE OF CONTENTS



Independent Auditors' Report.................................................F-2

Consolidated Financial Statements:

   Consolidated Balance Sheet at December 31, 2003...........................F-3

   Consolidated Statements of Operations for the year ended
      December 31, 2003 and 2002.............................................F-4

   Consolidated Statements of Changes in Stockholders' Deficit
      for the year ended December 31, 2003 and 2002..........................F-5

   Consolidated Statements of Cash Flows for the year ended
      December 31, 2003 and 2002.............................................F-6

Notes to Consolidated Financial Statements...........................F-7 to F-26


                                       F-1
<PAGE>
                          INDEPENDENT AUDITORS' REPORT



To the Board of Directors and Stockholders:
 IBX Group, Inc.

We have audited the accompanying consolidated balance sheet of IBX Group, Inc.
and Subsidiaries as of December 31, 2003, and the related consolidated
statements of operations, changes in stockholders' deficit and cash flows for
the years ended December 31, 2003 and 2002. These consolidated financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these consolidated financial
statements based on our audits.

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

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated financial position of IBX
Group, Inc. and Subsidiaries, as of December 31, 2003, and the consolidated
results of their operations and their cash flows for the years ended December
31, 2003 and 2002, in conformity with accounting principles generally accepted
in the United States of America.

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 10 to
the consolidated financial statements, the Company has a working capital
deficiency of $1,900,961 at December 31, 2003, and has an accumulated deficit of
$6,413,941. These matters raise substantial doubt about the Company's ability to
continue as a going concern. Management's plans in regards to these matters are
also described in Note 10. The consolidated financial statements do not include
any adjustments that might result from the outcome of this uncertainty.



SALBERG & COMPANY, P.A.
Boca Raton, Florida
March 15, 2004

                                       F-2
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET
                               December 31, 2003

                                     ASSETS
Current assets:
  Cash ............................................................ $    22,133
  Restricted cash .................................................     438,091
  Accounts receivable, net of allowance for
   doubtful accounts of $51,258 ...................................     541,692
  Due from related parties ........................................      94,382
  Other current assets ............................................      88,637
                                                                    -----------

    Total current assets ..........................................   1,184,935
                                                                    -----------

Property and equipment, net .......................................     291,117
                                                                    -----------

Other assets:
  Intangible assets, net ..........................................         985
  Other ...........................................................      27,151
                                                                    -----------

    Total other assets ............................................      28,136
                                                                    -----------

    Total assets .................................................. $ 1,504,188
                                                                    ===========

                      LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:
  Note payable, current maturities ................................ $   544,771
  Checks outstanding in excess of bank balances ...................      42,324
  Accounts payable ................................................     446,332
  Accrued expenses ................................................     480,957
  Payroll taxes payable ...........................................   1,538,609
  Deferred revenue ................................................      14,467
  Due to related party ............................................      18,436
                                                                    -----------

    Total current liabilities .....................................   3,085,896
                                                                    -----------

Commitments and contingencies

Stockholders' deficit:
  Preferred Stock ($0.005 par value; 4,700,000 authorized shares;
   none issued and outstanding) ...................................           -
  Class A Non-voting Convertible Preferred Stock ($0.005 par value;
   300,000 authorized shares; 57,000 shares issued and outstanding)         285
  Common stock ($0.005 par value; 100,000,000 authorized shares;
   90,729,877 shares issued and outstanding) ......................     453,650
  Common stock issuable (2,100 shares) ............................          10
  Additional paid-in capital ......................................   4,542,706
  Accumulated deficit .............................................  (6,413,941)
  Less: Stock subscription receivable .............................     (90,000)
  Less: Deferred compensation and consulting ......................     (74,418)
                                                                    -----------

    Total stockholders' deficit ...................................  (1,581,708)
                                                                    -----------

    Total liabilities and stockholders' deficit ................... $ 1,504,188
                                                                    ===========

          See accompanying notes to consolidated financial statements.
                                       F-3
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS

                                                        For the Year Ended
                                                            December 31,
                                                    ---------------------------
                                                        2003           2002
                                                    ------------   ------------

REVENUES .........................................  $  3,327,852   $  3,220,104
                                                    ------------   ------------


OPERATING EXPENSES:
    Salaries and payroll taxes ...................     2,301,790      1,300,563
    Depreciation and amortization ................       172,374        115,826
    Consulting fees ..............................     1,022,268              -
    Professional fees ............................       274,185        191,106
    Rent .........................................       446,829        230,275
    Other selling, general and administrative ....     1,696,843      1,077,836
    Loss from impairment of intangible assets ....       592,604              -
                                                    ------------   ------------

        Total Operating Expenses .................     6,506,893      2,915,606
                                                    ------------   ------------

INCOME (LOSS) FROM OPERATIONS ....................    (3,179,041)       304,498
                                                    ------------   ------------

OTHER INCOME (EXPENSES):
    Settlement expense ...........................       (64,770)             -
    Gain on forgiveness of debt ..................             -        289,662
    Interest expense .............................      (354,752)      (430,867)
                                                    ------------   ------------

        Total Other Income (Expenses) ............      (419,522)      (141,205)
                                                    ------------   ------------

NET INCOME (LOSS) ................................  $ (3,598,563)  $    163,293
                                                    ============   ============

EARNING (LOSS) PER SHARE:
    Net Income (Loss) Per Common Share - Basic ...  $      (0.06)  $       0.00
                                                    ============   ============
    Net Income (Loss) Per Common Share - Diluted .  $      (0.06)  $       0.00
                                                    ============   ============

    Weighted Common Shares Outstanding - Basic ...    60,604,049     37,003,110
                                                    ============   ============
    Weighted Common Shares Outstanding - Diluted .    60,604,049     55,176,341
                                                    ============   ============

           See accompanying note to consolidated financial statements.
                                       F-4
<PAGE>
<TABLE>
                                            IBX GROUP, INC. AND SUBSIDIARIES
                               CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT
                                     For the Years Ended December 31, 2003 and 2002

<CAPTION>
                                                   CLASS A NON-VOTING
                                                       CONVERTIBLE
                                                     PREFERRED STOCK         COMMON STOCK         COMMON STOCK ISSUABLE
                                                    -----------------   -----------------------   ---------------------
                                                    SHARES    AMOUNT      SHARES       AMOUNT       SHARES      AMOUNT
                                                    -------   -------   -----------   ---------   ----------   --------
<S>                                                 <C>       <C>        <C>          <C>         <C>          <C>
Balance at December 31, 2001 .....................        -   $     -    41,837,500   $ 209,189    2,000,000   $ 10,000

Exercise of stock options ........................        -         -       250,000       1,250            -          -

Exercise of warrants for cash ....................        -         -       789,997       3,950            -          -

Exercise of warrants for exchange of debt ........        -         -     1,792,366       8,962            -          -

Common stock issued in exchange for debt .........        -         -     1,081,880       5,409            -          -

Grant of warrants ................................        -         -             -           -            -          -

Common stock issued for services rendered ........        -         -     1,000,000       5,000            -          -

Issuance of previously issuable common stock .....        -         -     2,000,000      10,000   (2,000,000)   (10,000)

Issuance of preferred shares for common ..........   80,000       400    (8,000,000)    (40,000)           -          -

Common stock issuable for acquisition of assets ..        -         -             -           -      600,000      3,000

Amortization of deferred compensation ............        -         -             -           -            -          -

Net income for the year ..........................        -         -             -           -            -          -
                                                    -------   -------   -----------   ---------   ----------   --------

Balance at December 31, 2002 .....................   80,000       400    40,751,743     203,760      600,000      3,000

Exercise of stock warrants .......................        -         -    41,137,634     205,688            -          -

Grant of warrants ................................        -         -             -           -            -          -

Common stock issued for services rendered ........        -         -     1,500,234       7,501            -          -

Issuance of previously issuable common stock .....        -         -       600,000       3,000     (600,000)    (3,000)

Common stock issued and issuable for
          acquisition of assets ..................        -         -     3,847,900      19,239        2,100         10

Conversion of preferred to common ................  (23,000)     (115)    2,300,000      11,500            -          -

Sale of unregistered common stock ................        -         -       592,366       2,962            -          -

Settlement of subscriptions receivable ...........        -         -             -           -            -          -

Amortization of deferred compensation ............        -         -             -           -            -          -

Net loss for the year ............................        -         -             -           -            -          -
                                                    -------   -------   -----------   ---------   ----------   --------

Balance at December 31, 2003 .....................   57,000   $   285    90,729,877   $ 453,650        2,100   $     10
                                                    =======   =======   ===========   =========   ==========   ========
                                                                                                            (continued)
                              See accompanying note to consolidated financial statements.
                                                          F-5A
</TABLE>
<PAGE>
<TABLE>
                                            IBX GROUP, INC. AND SUBSIDIARIES
                               CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT
                                     For the Years Ended December 31, 2003 and 2002
                                                       (continued)
<CAPTION>

                                                                                               DEFERRED
                                                      ADDITIONAL                   STOCK      COMPENSATION
                                                       PAID-IN     ACCUMULATED  SUBSCRIPTION      AND
                                                       CAPITAL       DEFICIT     RECEIVABLE    CONSULTING      TOTAL
                                                     -----------   -----------    --------     ---------    -----------
<S>                                                  <C>           <C>            <C>          <C>          <C>
Balance at December 31, 2001 .....................   $   250,489   $(2,978,671)   $      -     $(139,849)   $(2,648,842)

Exercise of stock options ........................         1,250             -      (2,500)            -              -

Exercise of warrants for cash ....................        75,050             -           -             -         79,000

Exercise of warrants for exchange of debt ........       170,274             -           -             -        179,236

Common stock issued in exchange for debt .........       102,779             -     (17,570)            -         90,618

Grant of warrants ................................         4,000             -           -        (2,667)         1,333

Common stock issued for services rendered ........        41,000             -           -        (9,200)        36,800

Issuance of previously issuable common stock .....             -             -           -             -              -

Issuance of preferred shares for common ..........        39,600             -           -             -              -

Common stock issuable for acquisition of assets ..        24,600             -           -             -         27,600

Amortization of deferred compensation ............             -             -           -        40,143         40,143

Net income for the year ..........................             -       163,293           -             -        163,293
                                                     -----------   -----------    --------     ---------    -----------

Balance at December 31, 2002 .....................       709,042    (2,815,378)    (20,070)     (111,573)    (2,030,819)

Exercise of stock warrants .......................     3,017,440             -     (90,000)            -      3,133,128

Grant of warrants ................................       166,000             -           -             -        166,000

Common stock issued for services rendered ........        97,542             -           -             -        105,043

Issuance of previously issuable common stock .....             -             -           -             -              -

Common stock issued and issuable for
          acquisition of assets ..................       537,411             -           -             -        556,660

Conversion of preferred to common ................       (11,385)            -           -             -              -

Sale of unregistered common stock ................        26,656             -           -             -         29,618

Settlement of subscriptions receivable ...........             -             -      20,070             -         20,070

Amortization of deferred compensation ............             -             -           -        37,155         37,155

Net loss for the year ............................             -    (3,598,563)          -             -     (3,598,563)
                                                     -----------   -----------    --------     ---------    -----------

Balance at December 31, 2003 .....................   $ 4,542,706   $(6,413,941)   $(90,000)    $ (74,418)   $(1,581,708)
                                                     ===========   ===========    ========     =========    ===========

                              See accompanying note to consolidated financial statements.
                                                          F-5B
</TABLE>
<PAGE>
<TABLE>
                                         IBX GROUP, INC. AND SUBSIDIARIES
                                       CONSOLIDATED STATEMENTS OF CASH FLOWS

<CAPTION>
                                                                                            For the Years
                                                                                         Ended December 31,
                                                                                    -----------------------------
                                                                                       2003               2002
                                                                                    -----------         ---------
<S>                                                                                 <C>                 <C>
Cash flows from operating activities:
  Net (loss) income ........................................................        $(3,598,563)        $ 163,293
  Adjustments to reconcile net (loss) income to net cash
  (used in) provided by operating activities:
   Depreciation and amortization ...........................................            172,374           115,826
   Non-cash compensation and consulting expense ............................            308,198            80,028
   Loss from sale/abandonment of property and equipment ....................             24,583                 -
   Impairment of intangible assets .........................................            592,604                 -
   Settlement expense ......................................................             64,770                 -
   Gain on forgiveness of debt .............................................                  -          (289,662)

   (Increase) decrease in:
    Accounts receivable ....................................................           (383,622)          (14,957)
    Due from related parties ...............................................            (94,382)                -
    Other current assets ...................................................            (66,322)           (5,198)
    Other ..................................................................            (27,151)                -

   Increase (decrease) in:
    Accounts payable .......................................................            (35,411)           99,927
    Accrued expenses .......................................................            374,073          (201,240)
    Payroll taxes payable ..................................................            560,257           503,626
    Customer deposits ......................................................           (185,925)         (177,923)
    Deferred revenue .......................................................           (173,033)          187,500
    Interest payable .......................................................                  -            34,576
                                                                                    -----------         ---------

Net cash (used in) provided by operating activities ........................         (2,467,550)          495,796
                                                                                    -----------         ---------

Cash flows from investing activities:
  Cash receieved from (paid for) acquisition ...............................              3,108           (35,000)
  Increase in restricted cash ..............................................           (438,091)                -
  Proceeds from sale of property and equipment .............................             15,100                 -
  Purchase of property and equipment .......................................           (163,083)          (89,054)
                                                                                    -----------         ---------

Net cash used in investing activities ......................................           (582,966)         (124,054)
                                                                                    -----------         ---------

Cash flows from financing activities:
  Proceeds from exercise of stock warrants .................................          3,088,428            79,000
  Proceeds from sale of common stock .......................................             29,618                 -
  Checks outstanding in excess of bank balances ............................             17,260          (109,171)
  Payments on loans ........................................................           (516,421)         (293,782)
  Proceeds from loans ......................................................            412,478           163,000
  Proceeds from (payments on) advances from related party ..................             17,982          (189,676)
                                                                                    -----------         ---------

Net cash provided by (used in) financing activities ........................          3,049,345          (350,629)
                                                                                    -----------         ---------

Net (decrease) increase in cash ............................................             (1,171)           21,113

Cash at beginning of year ..................................................             23,304             2,191
                                                                                    -----------         ---------

Cash at end of year ........................................................        $    22,133         $  23,304
                                                                                    ===========         =========
                                                                                                       (continued)
                           See accompanying notes to consolidated financial statements.
                                                       F-6A
</TABLE>
<PAGE>
<TABLE>
                                         IBX GROUP, INC. AND SUBSIDIARIES
                                       CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                   (continued)
<CAPTION>
                                                                                            For the Years
                                                                                         Ended December 31,
                                                                                    -----------------------------
                                                                                       2003               2002
                                                                                    -----------         ---------
<S>                                                                                 <C>                 <C>
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Cash paid during the period for:
  Interest .................................................................        $    56,870         $       -
                                                                                    ===========         =========
  Income Taxes .............................................................        $         -         $       -
                                                                                    ===========         =========

NON-CASH INVESTING AND FINANCING ACTIVITIES:
  Common stock issued for debt and subscription receivable .................        $         -         $ 108,188
                                                                                    ===========         =========
  Exercise of common stock warrants for debt ...............................        $         -         $ 179,236
                                                                                    ===========         =========
  Common stock issuable for assets .........................................        $         -         $  27,600
                                                                                    ===========         =========

Acquisition details:
  Fair value of assets acquired ............................................        $   257,832         $  18,816
                                                                                    ===========         =========
  Liabilities assumed ......................................................        $    10,699         $  55,023
                                                                                    ===========         =========
  Goodwill .................................................................        $   309,527         $  71,207
                                                                                    ===========         =========

                           See accompanying notes to consolidated financial statements.
                                                        F-6B
</TABLE>
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2003


NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

ORGANIZATION

IBX Group, Inc. (the "Company") was organized under the laws of the state of
Florida in July 1997 as Vidkid Distribution, Inc. ("Vidkid"). On September 25,
2001 (the "acquisition date"), the Company acquired all of the outstanding
capital stock of PriMed Technologies, Inc., a Florida corporation ("PriMed").
PriMed was organized under the laws of the State of Florida on February 4, 1999
as a limited liability company and reorganized as a corporation on January 1,
2000. PriMed was acquired in a stock-for-stock transaction in which PriMed's
shareholders received approximately 81% of the outstanding common stock of
Vidkid on a fully diluted basis. Under the Agreement, Vidkid issued 11,550,000
shares of its common stock in exchange for each and every share of common stock
of PriMed and Vidkid's name was changed to IBX Group, Inc.
For financial accounting purposes, the exchange of stock was treated as a
recapitalization of PriMed with the former shareholders of Vidkid retaining
2,637,500 or approximately 19% of the outstanding stock. The stockholders'
equity section reflects the change in the capital structure of PriMed due to the
recapitalization and the consolidated financial statements reflect the
operations of PriMed for the periods presented and the operations of IBX Group,
Inc. from the acquisition date.

The Company is engaged in providing administrative services (accounting, billing
and collection, claims processing, information management), network support and
maintenance to clients predominantly in the healthcare sector. In addition, the
Company has developed proprietary software and applications with interactive
web-enabled multimedia capabilities with which the Company will develop new
markets and lines of business.

In September 2002, the Company acquired Florida Health Source, LLC and entered
the business of providing physical therapy services to referred patients. In
April 2003, the Company acquired NurseStat, LLC and entered the business of
providing medical staffing applications. In May 2003, the Company acquired the
business of Independent Transcription Services and entered the business of
providing dictating transcription and document management services for the
healthcare industry. In May 2003, the Company acquired certain assets and the
business of Medicompliant Solutions and Legal Services, Inc. and entered the
business of providing outsourced legal compliance services for the healthcare
industry. In May 2003, the Company formed a new majority-owned subsidiary, Robo
Massage, LLC and licensed the rights to certain massage technology which it will
use in its physical therapy centers and which it will sell (See Note 2).

All of the shares and assets of the Company's primary operating subsidiary have
been pledged to secure a loan obligation to a creditor. Two of the Company's
primary officers have also pledged the shares of the Company owned by them. .
The parties entered into an amended settlement agreement effective November 7,
2002 whereby the creditor agreed to dismiss his action against the Company.
Pursuant to the terms of the Agreement, the Company is obligated to make certain
monthly payments, all of which have been made to date. The creditor, pursuant to
the settlement agreement, has a lien and perfected security interest on all of
the assets of IBX Technologies, Inc., which is IBX's primary operating
subsidiary and on 11,550,000 shares of IBX common stock owned by two of the
Company's officers. As of December 31, 2003, approximately $132,293 was
outstanding on the loan. Failure to comply with the terms and conditions of the
loan documents could result in a default and the transfer of these assets and
shares to the lender.

                                       F-7
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2003


NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

PRINCIPLES OF CONSOLIDATION

The consolidated statements include the accounts of IBX Group, Inc. and its
wholly-owned subsidiaries and partially-owned subsidiary. All significant
inter-company balances and transactions have been eliminated.

USE OF ESTIMATES

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect certain reported amounts and disclosures. Accordingly, actual results
could differ from those estimates. Significant estimates in 2003 and 2002
include the allowance for doubtful accounts, the impairment loss on goodwill and
other intangible assets, and the valuation of certain equity instruments issued
or granted for services.

CASH AND CASH EQUIVALENTS

For purposes of the statement of cash flows, the Company considers all cash and
other demand deposits to be cash and cash equivalents. As of December 31, 2003
and 2002, the Company had no cash equivalents.

ACCOUNTS RECEIVABLE AND ALLOWANCE

The Company estimates an allowance for doubtful accounts relating to its medical
billing business on a specific identification basis. Allowance for doubtful
accounts related to the physical therapy and other businesses are estimated
based on the Company's estimate of collectibility based on factors such as age
of receivables and historical collection experiences. At December 31, 2003,
$458,682 of net accounts receivables were collateral under a loan agreement (see
Note 4).

FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying amounts reported in the balance sheet for cash, accounts
receivable, accounts payable and accrued expenses, payroll taxes payable, and
loans payable approximate their fair market value based on the short-term
maturity of these instruments.

PROPERTY AND EQUIPMENT

Property and equipment are stated at cost and are being depreciated using the
straight-line method over the estimated useful lives of three to seven years.
Leasehold improvements are stated at cost and are being amortized over the
lesser of the term of the lease or the estimated useful life of the asset. When
assets are retired or otherwise disposed of, the costs and accumulated
depreciation are removed from the respective accounts and any related gain or
loss is recognized. Maintenance and repair costs are charged to expense as
incurred, and renewals and improvements that extend the useful lives of assets
are capitalized.

                                       F-8
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2003


NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

REVENUE RECOGNITION

The Company follows the guidance of the Securities and Exchange Commision's
Staff Accounting Bulletin 101 for revenue recognition. In general, the Company
records revenue when persuasive evidence of an arrangement exists, services have
been rendered or product delivery has occurred, the sales price to the customer
is fixed or determinable, and collectability is reasonably assured. The
following policies reflect specific criteria for the various revenues streams of
the Company:

Revenue derived from billing and collections and administrative services is
recognized at the completion of the service performed. For billing and
collection services, the Company receives a commission from the customer based
on a percentage of amounts actually collected. Revenues are recognized as a net
amount equal to the percentage commission once the customer's receivable had
been received. Software application revenue (from licensing) is recognized in
accordance with the terms of the specific agreements.

Maintenance and support revenues are recognized over the term of the related
agreements.

The Company's FHS subsidiary primarily acts as a referral network for physical
therapy patients who are referred by insurance carriers. Revenue from providing
physical therapy services was recognized upon completion of the patient services
and was recorded net of amounts due to service providers for the fiscal year
ended December 31, 2002. In 2003, the Company re-evaluated this revenue
recognition policy of the FHS subsidiary and determined that it qualifies for
the use of the Gross Method under EITF 99-19, "Recording Revenues Gross as a
Principal versus Net as an Agent". The cumulative effect of the change in
accounting principal was not material.

Revenues from providing medical staffing application services will be recognized
as services are provided.

Customer prepayments from outsourced legal compliance services are deferred and
recognized as earned over the service period.

INTANGIBLES AND OTHER LONG-LIVED ASSETS

The Company reviews the carrying value of intangibles and other long-lived
assets for impairment at least annually or whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable. Recoverability of long-lived assets is measured by comparison of
its carrying amount to the undiscounted cash flows that the asset or asset group
is expected to generate. If such assets are considered to be impaired, the
impairment to be recognized is measured by the amount by which the carrying
amount of the property, if any, exceeds its fair market value. Goodwill
represents the excess of the cost of the Company's acquired subsidiaries or
assets over the fair value of their net assets at the date of acquisition. Under
Statement of Financial Accounting Standards ("SFAS") No. 142, effective the
first quarter of the year ended December 31, 2002, goodwill is no longer subject
to amortization over its estimated useful life; rather, goodwill is subject to
at least an annual assessment for impairment applying a fair-value based test.

                                       F-9
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2003


NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

INTANGIBLES AND OTHER LONG-LIVED ASSETS (CONTINUED)

In the fourth quarter of 2003, based on an impairment test, the Company decided
to write-off all goodwill and other intangible asset balances of $592,604
relating to the acquisition of the Company's subsidiaries NursesStat LLC,
Florida Health Source LLC, RoboMassage, and Independent Transcription Services
and the acquisition of certain assets under purchase agreements. The decision to
recognize an impairment loss was made in light of the subsidiaries inability to
generate a profit after the acquisition, mounting intercompany balances, the
length of time estimated for us to recover the initial investment, and the
uncertainty of market conditions and business performance (see Note 2).

INCOME (LOSS) PER COMMON SHARE

Basic income (loss) per share is computed by dividing net income (loss) by the
weighted average number of shares of common stock outstanding during the period.
Diluted income per share is computed by dividing net income by the weighted
average number of shares of common stock, common stock equivalents and
potentially dilutive securities outstanding during each period. The following
table presents a reconciliation of basic and diluted earnings per share:

                                                        2003           2002
                                                        ----           ----
Net (loss) income ................................  $ (3,598,563)  $    163,293
                                                    ------------   ------------
(Loss) income available to common shares .........  $ (3,598,563)  $    163,293
Weighted average shares outstanding - basic ......    60,604,049     37,003,110
EPS - BASIC ......................................  $      (0.06)  $      (0.00)
                                                    ============   ============

(Loss) income available to common shares .........  $ (3,598,563)  $    163,293
                                                    ============   ============
Weighted average shares outstanding - basic ......    60,604,049     37,003,110

Effect of dilutive securities:
Convertible preferred stock ......................             -      2,016,438
Contingently returnable common stock-
 Contingency satisfied at December 31, 2003 ......             -      6,600,000
Exercised options and warrants ...................             -        693,712
Unexercised options and warrants .................             -      8,863,081
                                                    ------------   ------------
Weighted average shares outstanding - diluted ....    60,604,049     55,176,341
                                                    ============   ============
EPS - DILUTED ....................................  $      (0.06)  $      (0.00)
                                                    ============   ============

In 2003, 530,000 common stock options were not included in the computation of
diluted earnings per share as their effect would have been anti-dilutive.

                                      F-10
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2003


NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

STOCK-BASED COMPENSATION

The Company accounts for stock options issued to employees in accordance with
the provisions of Accounting Principles Board ("APB") Opinion No. 25,
"Accounting for Stock Issued to Employees," and related interpretations. As
such, compensation cost is measured on the date of grant as the excess of the
current market price of the underlying stock over the exercise price. Such
compensation amounts are amortized over the respective vesting periods of the
option grant. The Company adopted the disclosure provisions of SFAS No. 123,
"Accounting for Stock-Based Compensation" and SFAS 148, "Accounting for
Stock-Based Compensation -Transition and Disclosure", which permits entities to
provide pro forma net income (loss) and pro forma earnings (loss) per share
disclosures for employee stock option grants as if the fair-valued based method
defined in SFAS No. 123 had been applied. The Company accounts for stock options
and stock issued to non-employees for goods or services in accordance with the
fair value method of SFAS 123.

ADVERTISING

Advertising costs are expensed when incurred. For the years ended December 31,
2003 and 2002, advertising expense amounted to $250,662 and $239,698,
respectively.

INCOME TAXES

Income taxes are accounted for under the asset and liability method of Statement
of Financial Accounting Standards No. 109, "Accounting for Income Taxes ("SFAS
109"). Under SFAS 109 deferred tax assets and liabilities are recognized for the
future tax consequences attributable to differences between the financial
statement carrying amounts of existing assets and liabilities and their
respective tax bases. Deferred tax assets and liabilities are measured using
enacted tax rates expected to apply to taxable income in the years in which
those temporary differences are expected to be recovered or settled. Under SFAS
109, the effect on deferred tax assets and liabilities of a change in tax rates
is recognized in income in the period that includes the enactment date.

RECENT ACCOUNTING PRONOUNCEMENTS

In December 2002, the FASB issued Statement of Financial Accounting Standards
No. 148, Accounting for Stock-Based Compensation - Transition and Disclosure.
Statement 148 provides alternative methods of transition to Statement 123's fair
value method of accounting for stock-based employee compensation. It also amends
the disclosure provisions of Statement 123 and APB Opinion No. 28, Interim
Financial Reporting, to require disclosure in the summary of significant
accounting policies of the effects of an entity's accounting with respect to
stock-based employee compensation on reported net income and earnings per share
in annual and interim financial statements. Statement 148's amendment of the
transition and annual disclosure requirements of Statement's 123 are effective
for fiscal years ending after December 15, 2002. Statement 148's amendment of
the disclosure requirements of Opinion 28 is effective for interim periods
beginning after December 15, 2002. The adoption of the disclosure provisions of
Statement 148 as of December 31, 2002 did not have a material impact on the
Company's financial condition or results of operations.

                                      F-11
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2003


NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

RECENT ACCOUNTING PRONOUNCEMENTS (CONTINUED)

In January 2003, the FASB issued Interpretation No. 46 ("FIN 46"),
"Consolidation of Variable Interest Entities." FIN 46 requires that if an entity
has a controlling financial interest in a variable interest entity, the assets,
liabilities and results of activities of the variable interest entity should be
included in the consolidated financial statements of the entity. FIN 46 requires
that its provisions are effective immediately for all arrangements entered into
after January 31, 2003. The Company does not have any variable interest entities
created after January 31, 2003. For those arrangements entered into prior to
January 31, 2003, the FIN 46 provisions are required to be adopted at the
beginning of the first interim or annual period beginning after June 15, 2003.
The Company has not identified any variable interest entities to date and will
continue to evaluate whether it has variable interest entities that will have a
significant impact on its consolidated balance sheet and results of operations.

In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain Financial
Instruments with Characteristics of Both Liabilities and Equity." This statement
establishes standards for how an issuer classifies and measures certain
financial instruments with characteristics of both liabilities and equity. This
statement is effective for financial instruments entered into or modified after
May 31, 2003, and otherwise is effective for the first interim period beginning
after June 15, 2003, with certain exceptions. The adoption of SFAS No. 150 did
not have a significant impact on our consolidated financial position or results
of operations.

NOTE 2 - ACQUISITION

On October 4, 2002 (the "Acquisition Date") the Company acquired 100% of the
membership interest in Florida Health Source, LLC ("FHS"), a Florida limited
liability company formed on September 9, 2002. At the acquisition date, FHS was
a preferred provider network for more than 100,000 employees throughout the
state of Florida and is now a physical and occupational therapy vendor for a
major U.S. retailer. Additionally, currently FHS operates two multi-disciplinary
facilities providing physical therapy, occupational medicine, pain management
and wellness services. In connection with the acquisition, the Company entered
into employment agreements with three key employees. Each employment agreement
has a term of three years effective October 1, 2002 and grants a 13.33%
membership interest in FHS (an aggregate 39.99% interest for all three
employees) upon attaining certain stipulated financial performance goals in FHS.
The Company accounted for this acquisition using the purchase method of
accounting in accordance with SFAS No. 141. On the date of acquisition, the
purchase price exceeded the fair value of net assets acquired by $71,207. The
excess had been applied to goodwill. The results of operations of FHS are
included in the consolidated results of operations of the Company from the
Acquisition Date. Pursuant to Statement of Financial Accounting Standards No.
142, "Goodwill and Other Intangible Assets" Goodwill has an indefinite life and
accordingly will not be amortized. The FHS assets and liabilities acquired were
as follows:

         Accounts receivable                 $ 18,816
         Due to providers                     (15,052)
         Accrued compensation                 (39,971)
         Goodwill                              71,207
                                             --------
         Cash purchase price                 $ 35,000
                                             ========

                                      F-12
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2003


NOTE 2 - ACQUISITION (CONTINUED)

On December 6, 2002 (the "Acquisition Date") the Company entered into an asset
purchase agreement with an individual related to a director of the Company,
whereby, the Company acquired more than 170 domain names and informational
websites on healthcare topics ranging from arthritis to diabetes. In connection
with the asset purchase agreement, the Company issued 600,000 shares of common
stock. The fair value of the intangible assets acquired was based on the $.046
quoted trading price of the common stock on the acquisition date and amounted to
$27,600 (see Note 5).

Effective April 1, 2003, the Company acquired all of the membership interests in
NursesStat, LLC, a Florida limited liability company. The closing date occurred
in late June 2003. NursesStat is a medical staffing application service
provider. The Company accounted for this acquisition using the purchase method
of accounting in accordance with SFAS No. 141. In connection with the
acquisition, the Company issued 3,000,000 and 200,000 shares of common stock to
the sellers and a third party, respectively. The value of the 3,000,000 common
shares issued of $.137 per share or $410,400 was determined based on the average
market price of the Company's common shares over the 5-day period before and
after the terms of the acquisition were agreed to and announced (March 17,
2003). Additionally, the Company issued 200,000 common shares to consultant in
connection with the acquisition of NursesStat. These shares were valued at $.18
per share, based on the grant date, for a value of $36,000.

The purchase price exceeded the fair value of net assets acquired by $404,527.
The Company applied $95,000 of the excess to customer lists based on the present
value of future cash flows of a sales contract, which was being amortized over a
36 month period. The remaining excess of $309,527 has been applied to goodwill.
The results of operations of NursesStat are included in the consolidated results
of operations of the Company from the acquisition date of April 1, 2003. On
April 1, 2003, the Company's NurseStat subsidiary entered into two employment
agreements with its Managing Directors. The term of the agreements are for three
years with an annual base salary of $80,000 each, with an option to renew for
two additional three years periods. Additionally, each of these individual will
be entitled to a bonus of 12.5% of net profits of NursesStat, as defined.

On May 5, 2003, the Company, through its wholly-owned subsidiary IBX
Transcription Services, Inc. ("IBXT"), acquired certain assets and the business
of ITS Acquisition, Inc. d/b/a Independent Transcription Services ("ITS"), a
Florida corporation. ITS provides dictation, transcription and document
management services for the healthcare industry. As a result of the acquisition,
the Company is a provider of transcription services for the healthcare industry
and will sell its transcription technology to ITS customers. The Company
accounted for this acquisition using the purchase method of accounting in
accordance with SFAS No. 141. In connection with the acquisition of certain
assets, prior to the acquisition date, the Company issued 150,000 shares of
common stock to the seller. The value of the 150,000 common shares issued of
$.1564 per share or $23,460 was determined based on the fair market price of the
Company's common shares over the 5-day period before and after the terms of the
acquisition were agreed to and announced (May 5, 2003). The purchase price
exceeded the fair value of net assets acquired by $17,128. The excess had been
applied to customer lists and was being amortized over a 36 month period. The
results of operations of ITS are included in the consolidated results of
operations of the Company from the acquisition date of May 5, 2003 to December
31, 2003. Effective November 4, 2002, the Company's IBXT subsidiary entered into
an employment agreement. The term of the agreement is for one year with a base
salary of $36,400. Additionally, this individual will be entitled to a bonus of
10% of net taxable income on any new business of IBXT and a bonus of 30% of net
taxable income of IBXT any new business of the IBXT that relates specifically to
certain clients as defined in the agreement.

                                      F-13
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2003


NOTE 2 - ACQUISITION (CONTINUED)

On May 6, 2003, the Company, through its wholly-owned subsidiary, Medicompliant
Solutions II, Inc. ("Medicompliant"), acquired certain assets and the business
of Medicompliant Solutions and Legal Services, Inc. ("MSL"), a Florida
corporation. MSL provides outsourced legal compliance services for the
healthcare industry. As a result of the acquisition, the Company is expected to
be the leading provider of outsourced legal compliance services. The Company
accounted for this acquisition using the purchase method of accounting in
accordance with SFAS No. 141. The Company acquired MSL for cancellation of
approximately $20,000 owed to the Company under an informal agreement for back
rent. The Company had not recorded such rental income in prior periods since
collection was unlikely. Additionally, on May 6, 2003, Medicompliant granted an
option to a third party to purchase from Medicompliant, upon terms and
conditions as defined in the options agreement, such number of Medicompliant's
common shares as shall, after issuance, be equivalent to twenty (20%) percent of
all outstanding shares of Medicompliant, for a consideration of $.01 per share.
The results of operations of Medicompliant are included in the consolidated
results of operations of the Company from the acquisition date of May 6, 2003 to
December 31, 2003.

On May 20, 2003, the Company formed a new Florida limited liability company,
Robo Massage, LLC ("Robo"), in which the Company has an 80% interest.
Simultaneously, the Company issued 500,000 shares of common stock in connection
with a licensing agreement, whereby, Robo licensed the rights to "RoboMassage",
a programmable, interactive massage table for use in healthcare and leisure
settings. The licensor has the option to terminate the Licensing agreement at
the end of each year commencing January 2005 for year 2004 if for any such year,
the sum of royalties paid pursuant to the licensing agreement plus the
Licensor's distributions from its membership interest in Robo are less than
$25,000. Robo agreed to pay to Licensor a royalty calculated as 6% of realized
revenue, defined as cash revenue received by Robo from the sale of licensed
products. The Company valued the 500,000 common shares issued at $.1736 per
share based on the trading price on the May 20, 2003 license date or $86,800.

For acquisitions in 2003, the assets acquired and liabilities assumed were as
follows:
<TABLE>
<CAPTION>
                             IBX Transcription                                     Medicompliant
                               Services, Inc.    NursesStat LLC   Robo Massage   Soultions II, Inc.     Total
                             -----------------   --------------   ------------   ------------------   ---------
<S>                              <C>               <C>              <C>              <C>              <C>
                      Cash       $  2,548          $     560        $      -         $       -        $   3,108
       Accounts receivable         13,216                  -               -                 -           13,216
      Other current assets              -              1,360               -                 -            1,360
    Property and equipment              -             26,376               -                 -           26,376
                   Patents              -             13,577               -                 -           13,577
Customer lists and license         17,128             95,000          86,800             1,267          200,195
          Accounts payable         (9,432)                 -               -           (1,267)          (10,699)
                  Goodwill              -            309,527               -                 -          309,527
                                 --------          ---------        --------         ---------        ---------

      Total purchase price       $ 23,460          $ 446,400        $ 86,800         $       -        $ 556,660
                                 ========          =========        ========         =========        =========
</TABLE>

                                      F-14
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2003


NOTE 2 - ACQUISITION (CONTINUED)

The following unaudited pro forma consolidated results of operations have been
prepared as if the acquisitions had occurred as of the beginning of the
following periods:

                                               Year Ended         Year Ended
                                           December 31, 2003   December 31, 2002
                                           -----------------   -----------------

Net Revenues ............................    $   3,337,578      $   3,357,128
Net (Loss) Income .......................    $  (3,615,438)     $    (451,000)
Net (Loss) Income per Share - Basic .....    $       (0.06)     $       (0.02)
Net (Loss) Income per Share - Diluted ...    $       (0.06)     $       (0.01)

Pro forma data does not purport to be indicative of the results that would have
been obtained had these events actually occurred at the beginning of the periods
presented and is not intended to be a projection of future results.

ACQUIRED INTANGIBLE ASSETS AND IMPAIRMENT

In the fourth quarter of 2003, based on an impairment test, the Company decided
to write-off all goodwill and other intangible asset balances of $592,604
relating to the acquisition of certain of the Company's assets and subsidiaries
NursesStat LLC, Florida Health Source LLC, RoboMassage, and Independent
Transcription Services and the acquisition of certain assets under purchase
agreements. The decision to recognize an impairment loss was made in light of
the subsidiaries inability to generate a profit after the acquisition, mounting
intercompany balances, the length of time estimated for us to recover the
initial investment, and the uncertainty of market conditions and business
performance. The Company expects to deduct goodwill for tax purposes over a
period of 15 years.

NOTE 3 - PROPERTY AND EQUIPMENT

At December 31, 2003, property and equipment consisted of the following:

Computer equipment and software ...........................$ 508,874
Furniture and office equipment ............................  113,132
Leasehold improvements ....................................  199,041
                                                           ---------
                                                             821,047
Less accumulated depreciation ............................. (529,930)
                                                           ---------
Total
                                                           $ 291,117
                                                           =========

Depreciation expense for the years ended December 31, 2003 and 2002 was $143,857
and $115,826, respectively. At December 31, 2003, $197,621 of net property and
equipment was encumbered under a loan agreement (see Note 4).

                                      F-15
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2003


NOTE 4 - NOTES PAYABLE

The Company's borrowings consisted of the following at December 31, 2003:

Loan payable to an individual, payable in various
installments through February 2004. The loan payable
includes accrued interest and is collateralized by all of
the assets of one of the Company's subsidiaries and
11,550,000 outstanding common shares of the Company held by
certain guarantors. See (a) below. ................................  $  132,293

Line of credit agreement with a financial institution. The
Company can borrow up to $425,000. Interest is payable on
the outstanding principal balance by adding the prevailing
base loan rate charged by the financial institution and the
sliding scale percentage rate, determined by the level of
the daily net loan balance ranging from 2.5% to .75% over
the base loan rate ( 5.375% at December 31, 2003). The loan
is collateralized by restricted cash and is payable on
demand. See (b) below. ............................................     412,478
                                                                     ----------
                                                                        544,771

Less: Current portion of loans payable ............................    (544,771)
                                                                     ----------
Total .............................................................  $        -
                                                                     ==========

(a)  On October 8, 2002, the Company made a payment and renegotiated a note
     payable with an individual. Accordingly, the principal amount of such note
     was reduced to $692,497 as of October 28, 2002. The lender retroactively
     restated the per annum interest rate prior to October 8, 2002 from 25% to
     15%. Furthermore, so long as the Company does not breach this agreement,
     effective October 8, 2002, the annual rate of interest was further reduced
     to 12.5% per annum. However, if the Company defaults on this agreement the
     loan will contingently revert to its previous outstanding balance on the
     date of this agreement with interest at 25% per annum. Certain shareholders
     of the Company's have pledged their shares of the Company owned by them and
     also personally guaranteed the note. As on the date of this report, the
     Company has met its obligations under this revised agreement. Failure to
     comply with the terms and conditions of the loan documents could result in
     a default and the transfer of these assets and shares to the lender.

(b)  The Company maintains restricted cash in a brokerage account that is
     collateral for this line of credit and shown as restricted cash on the
     accompanying balance sheet.

NOTE 5 - RELATED PARTY TRANSACTIONS

Certain officers/shareholders of the Company from time to time advanced funds to
the Company for operations and draws funds back as repayments or advances. These
amounts are non-interest bearing, non-collateralized, and are payable on demand.
As of December 31, 2003, amounts due one officer/shareholder of the Company
amounted to $18,436. These advances are subordinated to the loan payable (see
Note 4). At December 31, 2003, one officer/director of the Company owed the
Company $94,382, which was substantially paid back subsequent to year end.

                                      F-16
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2003


NOTE 5 - RELATED PARTY TRANSACTIONS (CONTINUED)

In 2001 the Company assumed the debt of an officer relating to a predecessor
company lawsuit of which $27,000 was paid in 2002.

In December 2002, the Company acquired certain domain names and related content
from a party related to a director of the Company for 600,000 shares of the
Company's common stock. The shares were valued at the quoted trading price on
the acquisition date resulting in an intangible asset of $27,600 (see Note 2).

NOTE 6 - STOCKHOLDERS' DEFICIT

PREFERRED STOCK

In August 2002, the Company designated 300,000 shares of its authorized
preferred stock as Class A Non-Voting Convertible Preferred Stock ("Class A
Preferred"). Each share of Class A Preferred is convertible into 100 shares of
common stock. A holder of Class A Preferred may not convert shares if such
conversion would result in such holder owning in excess of 4.9% of the Company's
common stock. The Class A Preferred holder is entitled to dividends when
declared on common stock equal to the equivalent common shares into which the
Class A Preferred is convertible. At such time, 80,000 shares of Class A
Preferred were issued in exchange for 8,000,000 shares of common stock held by
one entity. During the year ended December 31, 2003, the Class A preferred
shareholder converted 23,000 Class A preferred shares into 2,300,000 shares of
common stock.

COMMON STOCK

In June 2002, majority shareholders of the Company exercised warrants to
purchase 942,366 shares of common stock at $.10 per share in exchange for loans
payable amounting to $94,237 (including interest of $2,237).

In June 2002, a former director and shareholder of the Company exercised
warrants to purchase 850,000 shares of common stock at $.10 per share in
exchange for loans payable amounting to $85,000. Additionally, in June 2002, the
Company issued 1,081,880 shares of common stock at $.10 per share in exchange
for loans payable amounting to $90,618 and a subscription receivable of $17,570.
In December 2003, the Company settled this subscription receivable with a former
director, whereby the former director assigned 880,000 warrants held by the
former director back to the Company. For accounting purposes, this transaction
was treated as a sale of warrants at a fair market value of $.015 per warrant by
the selling warrant holder to the Company and resulted in a settlement expense
of $64,770.

In June 2002, 2,000,000 common shares previously issuable were issued.

In June 2002, stock options were exercised to purchase 250,000 shares of common
stock at $.01 per share for a subscription receivable of $2,500.

In August 2002, a principal shareholder of the Company converted 8,000,000
shares of common stock into 80,000 shares of Class A Non-Voting Convertible
Preferred Stock.

                                      F-17
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2003


NOTE 6 - STOCKHOLDERS' DEFICIT (CONTINUED)

COMMON STOCK (CONTINUED)

In August and September 2002, directors' and shareholders of the Company
exercised warrants to purchase 340,000 shares of common stock at $.10 per share
for net proceeds of $34,000.

In December 2002, majority shareholders of the Company exercised warrants to
purchase 370,000 shares of common stock at $.10 per share for net proceeds of
$37,000.

Pursuant to a stock bonus plan authorized by the board of directors on October
30, 2002 for up to 1,000,000 shares of common stock, in December 2002, the
Company issued 1,000,000 shares of common stock to consultants, employees and
directors for services rendered and to be rendered in the future. The Company
valued these common shares at the fair market value on the dates of issuance of
$.046 per share and recorded non-cash compensation of $36,800 and $9,200 in
deferred compensation relating to the issuance of 200,000 of these shares issued
to a director of the Company's for services to be rendered in 2003.

During the year ended December 31, 2003, warrant holders of the Company
exercised warrants to purchase 41,137,634 shares of common stock at $.10 per
share for net proceeds of $3,085,928 (net of $438,488 offering costs paid and
$205,165 of offering costs payable and included in accrued expenses) and a
subscription receivable of $90,000.

In April 2003, 600,000 shares of common stock previously issuable were issued.

In April 2003, in connection with the acquisition of NursesStat LLC, the Company
was required to issue 3,000,000 shares of common stock. As of December 31, 2003,
2,997,900 of these shares have been issued with the remaining 2,100 unissued
shares included in common stock issuable at December 31, 2003. Additionally, as
part of this acquisition, the Company issued 200,000 shares of common stock to a
consultant for services rendered. (See note 2)

In May 2003, in connection with the acquisition of Independent Transcription
Services, Inc., the Company issued 150,000 shares of common stock. (See note 2)

In May 2003, in connection with the acquisition of a licensing agreement, the
Company issued 500,000 shares of common stock. (See note 2)

In July 2003, 2,300,000 shares of common stock were issued in exchange for
23,000 shares of Class A preferred stock. At the exchange date, the fair market
value of the issued preferred stock equaled the fair market value of the
exchanged common shares resulting in no charges to operations.

In December 2003, the Company issued 1,500,000 shares of common stock to
employees (825,000 shares) and consultants (675,000 shares) for services
rendered. The Company valued these common shares at the fair market value on the
date of issuance of $.07 per share or $105,000, which has been recorded as
consulting expense and compensation expense amounting to $47,250 and $57,750,
respectively, in the accompanying statement of operations.

In December 2003, the Company sold 592,366 unregistered shares of common stock
to investor for net proceeds of $29,618.

                                      F-18
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2003


NOTE 6 - STOCKHOLDERS' DEFICIT (CONTINUED)

STOCK OPTIONS AND WARRANTS

On December 6, 2002, a shareholder sold, for nominal consideration, class A
stock warrants for 2,000,000 shares of common stock to a consultant for services
rendered and to be rendered in the future on behalf of the Company. For
accounting purposes, this transaction is treated as a contribution of the
warrants by the selling warrant holder to the Company and a new grant of
warrants to the consultant resulting in a consulting expense. The options had
exercise prices of $.10 per share and expire on June 24, 2003. The fair value of
each option grant was estimated on the date of grant using the Black-Scholes
option-pricing model with the following weighted-average assumptions dividend
yield of -0- percent; expected volatility of 105%; risk-free interest rate of
4.50 percent and an expected holding periods of six months. In connection with
the sale of these options, the Company recorded non-cash compensation of $1,333
and deferred compensation of $2,667. In December 2002, the consultant exercised
class A warrants for 80,000 common shares for net proceeds of $8,000.

On January 24, 2003, a shareholder sold, for nominal consideration, class A
stock warrants for 2,000,000 shares of common stock to a consultant for services
rendered and to be rendered in the future on behalf of the Company. For
accounting purposes, this transaction is treated as a contribution of the
warrants by the selling warrant holder to the Company and a new grant of
warrants to the consultant resulting in a consulting expense. The options had
exercise prices of $.10 per share and expire on June 24, 2003. The fair value of
each option grant was estimated on the date of grant using the Black-Scholes
option-pricing model with the following weighted-average assumptions dividend
yield of -0- percent; expected volatility of 146%; risk-free interest rate of
4.50 percent and an expected holding periods of five months. In connection with
the sale of these options, the Company recorded non-cash compensation of
$166,000.

In April 2003, a consultant to the Company entered into separate agreements with
the Tucker Family Spendthrift Trust and the Calvo Family Spendthrift Trust
pursuant to which he has the right to purchase all of the class A warrants from
the Tucker Family Spendthrift Trust and all of the class E warrants from the
Calvo Family Spendthrift Trust. The Trusts have agreed with the consultant to
not exercise the warrants so long as the consultant purchases 1,000,000 warrants
per month from each Trust. The Company agreed to reduce the exercise price of
the warrants purchased by the consultant in exchange for the exercise of such
warrants. As consideration for arranging the transaction between the parties,
the Company agreed to pay another third party a finder's fee of $.005 per
warrant for each warrant that is purchased by the consultant and subsequently
exercised. There is no financial accounting effect of these transactions other
than offsetting the fee paid against paid in capital as an offering cost.

During the three months ended June 30, 2003, the Company extended the expiration
date of it $.10 warrants to December 31, 2003 and the $.20 warrants to June 24,
2004. There was no accounting effect to this transaction as these were purchased
warrants rather than compensatory warrants.

In September 2003, the Company modified the terms of the outstanding warrants to
purchase 20,000,000 shares of the Company's common stock. The warrants had an
exercise price of $.20 per warrant and an expiration date of June 24, 2004. The
exercise price has been lowered to $.10 per share until December 31, 2003. The
Company could extend the period in which the price reduction is in effect. There
was no accounting effect of the modification for these purchased warrants.

                                      F-19
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2003


NOTE 6 - STOCKHOLDERS' DEFICIT (CONTINUED)

STOCK OPTION AND WARRANTS (CONTINUED)

A summary of outstanding options and warrants at December 31, 2003 are as
follows:
<TABLE>
<CAPTION>
                                    Shares Underlying     Range of Exercise      Remaining          Average
                                   Options and warrants         Prices        Contractual Life   Exercise Price
                                   --------------------   -----------------   ----------------   --------------
<S>                                     <C>                <C>                   <C>                 <C>
Outstanding at December 31, 2001          44,500,000       $0.01 - $0.50         1-5 years           $0.15
Granted                                    2,000,000               $0.10         0.5 years           $0.10
Exercised                                (2,832,366)               $0.10                 -           $0.10
Cancelled                                (2,000,000)               $0.10                 -           $0.10
                                   --------------------   -----------------   ----------------   --------------

Outstanding at December 31, 2002          41,667,634       $0.10 - $0.50         0-4 years           $0.16
Granted                                            -                   -                 -               -
Exercised                               (41,137,634)               $0.10                 -           $0.10
Cancelled                                          -                   -                 -               -
                                   --------------------   -----------------   ----------------   --------------

Outstanding at December 31, 2003             530,000         $0.10-$0.50         3.0 years           $0.28
                                   ====================   =================   ================   ==============
</TABLE>

Weighted average fair value of warrants and options granted in 2003        $.00
                                                                           ====

The following table summarizes information about employee stock options and
consultant warrants outstanding at December 31, 2003:
<TABLE>
<CAPTION>
                Options and Warrants Outstanding                        Options and Warrants Exercisable
 -----------------------------------------------------------------      --------------------------------
                                         Weighted
                                         Average          Weighted                              Weighted
 Range of            Number             Remaining          Average            Number             Average
 Exercise        Outstanding at        Contractual        Exercise        Exercisable at        Exercise
  Price        December 31, 2003          Life             Price        December 31, 2003        Price
 --------      -----------------       -----------        --------      -----------------       --------
<S>                 <C>                <C>                 <C>                <C>                <C>
 $ 0.50             250,000            3.00 Years          $ 0.50             250,000            $ 0.50
   0.10             280,000            3.00 Years            0.10             280,000              0.10
               -----------------                          --------      -----------------       --------
                    530,000                                $ 0.28             530,000            $ 0.28
               =================                          ========      =================       ========
</TABLE>

                                      F-20
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2003


NOTE 7 - INCOME TAXES

At December 31, 2003, the Company had net operating loss carry forwards of
approximately $4,670,000 for income tax purposes, available to offset future
taxable income expiring on various dates through 2023. Usage of the net
operating losses may be limited due to the Company's change in ownership, which
occurred in December 2001. The Company's tax expense differs from the "expected"
tax expense for the years ended December 31, 2003 and 2002 (computed by applying
the Federal Corporate tax rate of 34 percent to loss before taxes), as follows:

                                                          2003           2002
                                                          ----           ----

Computed "expected" tax expense (benefit) ........    $(1,248,967)    $  55,520
State income taxes ...............................       (151,395)       21,729
Other permanent differences ......................          6,800         8,713
Non-deductible impairment losses .................        201,485             -
Non-deductible stock based compensation ..........        104,787        27,210
Change in blended rate estimate ..................        (11,348)       42,118
Change in valuation allowance ....................      1,098,638      (155,290)
                                                      -----------     ---------
                                                      $         -     $       -
                                                      ===========     =========

The tax effects of temporary differences that give rise to significant portions
of deferred tax assets and liabilities at December 31, 2003 are as follows:

                                                                  2003
                                                              -----------
Deferred tax assets:
Net operating loss carry forward .........................    $ 1,845,673
Allowance for doubtful accounts ..........................         20,247
                                                              -----------

Total gross deferred tax assets ..........................      1,865,920

Less valuation allowance .................................     (1,865,920)
                                                              -----------
Net deferred tax assets ..................................    $         -
                                                              ===========

The valuation allowance at December 31, 2003 was $1,865,920. The increase during
2003 was $1,098,637.

In assessing the realizability of the deferred tax assets, management considers
whether it is more likely than not that some portions or all of the deferred tax
assets will not be realized. The ultimate realization of deferred tax assets is
dependent upon the generation of future taxable income or changes in ownership
or business during the periods in which the temporary differences become
deductible. Due to the Company's continuing losses and recent change in
ownership, it is more likely than not that the deferred tax assets will not be
realized.

                                      F-21
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2003


NOTE 8 - COMMITMENTS AND CONTINGENCIES

OPERATING LEASE

The Company leases its office facility under various non-cancelable operating
leases payable in monthly installments. The Company's FHS subsidiary leases its
office facility under a five-year non-cancelable operating lease payable in
monthly installments commencing in October 2002. Rent expense for the years
ended December 31, 2003 and 2002 was $446,829 and $230,761, respectively.

Future minimum lease payments as of December 31, 2003 are as follows:

         2004 ..............................  $  357,000
         2005 ..............................     293,000
         2006 ..............................     143,000
         2007 ..............................     134,000
         Thereafter ........................      99,000
                                              ----------

         Total future minimum lease payments  $1,026,000
                                              ==========

LITIGATION

The Company was party to a legal proceeding with its major creditor. An initial
settlement was reached in December 2000. The Company renegotiated the terms of
the settlement agreement and on August 13, 2001, the Company entered into a
second settlement agreement relating to this legal action. The Company defaulted
on this second settlement agreement and in October 2002 entered into a new
settlement agreement with the major creditor and the litigation was dismissed.
Through the date of the report, the Company has been making the scheduled
payments under this agreement. As of December 31, 2003, principal and accrued
interest amounting to $132,293 is included in the accompanying consolidated
financial statements as a loan payable (see Note 4).

Three former employees of the Company's subsidiary, FHS, have claimed they are
owed $54,608 in reimbursable expenses. The Company disputes such claims but has
conservatively accrued the amount in accounts payable.

The Company is involved in various claims and legal proceedings brought against
the Company arising in the normal course of business. The Company has accrued
estimated amounts related to these matters and do not believe that the ultimate
outcome will have a materially adverse effect on the Company's financial
position, results of operations, or liquidity.

                                      F-22
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2003


NOTE 8 - COMMITMENTS AND CONTINGENCIES (CONTINUED)

INSTALLMENT AGREEMENT WITH INTERNAL REVENUE SERVICE

The Company entered into an installment agreement with the U.S. Internal Revenue
Service (IRS) in October 2002 relating to unpaid payroll taxes. In connection
with this installment agreement, the Company paid $48,000 in November 2002 and
will make monthly payments of $12,000 until the balance is paid in full. In
event of default, the IRS has the right to file a notice of Federal tax lien. At
December 31, 2003, accrued payroll taxes and estimated accrued interest and
penalties aggregated $1,538,609.

EMPLOYMENT AGREEMENT

On December 19, 2001, the Company entered into an employment agreement with its
President for a period ending on December 31, 2006. As compensation for his
services, the President will receive in year one an annual base compensation of
$125,000. Subject to the continuing approval of the Company, the annual base
salary in each succeeding year will be equal to at least 110% of the annual base
salary from the prior year. Compensation will be paid no less frequently than
monthly or in such increments as are regularly paid by the Company to other
employees.

In addition to the annual salary, the President was issued 6,600,000 shares of
the Company's common stock, subject to certain restrictions and contingencies
(see Note 6). At December 31, 2002, the contingency was satisfied and the
restriction has lapsed. Subject to the prior approval of the Company, the
President will also be entitled to such other bonuses based upon the Company's
performance as determined in the sole and absolute discretion of the Company;
will be offered health insurance coverage at no cost to the President; be
entitled to participate in such employee benefit programs as are offered by the
Company to other employees; be entitled to an annual paid vacation of three
weeks per year plus five personal days per year, and any vacation time not used
may be accrued to the following year if the President remains employed with the
Company.

The President will also be reimbursed for out-of-pocket expenses incurred by him
in the performance of his job responsibilities. However, any reimbursable
expenses in excess of $1,000 must first be approved by the Company. The initial
term of the agreement commenced as of the date of the agreement, and will
continue until December 31, 2006. The Company will have the right to terminate
the agreement for good cause or by reason of the President's disability on 30
days prior written notice to the President. If such termination is for good
cause or by reason of the President's disability, a notice of termination
specifying the nature of the good cause or disability, as the case may be, will
be given the President. If the President is terminated for any other reason than
good cause, the Company will be obligated to pay the President a severance
payment of the greater of $100,000 or the remaining sums due under the
agreement.

On October 3, 2002, the Company's FHS subsidiary entered into an employment
agreement with its Director of Marketing and Business Development. The term of
the agreement is for three years with a base salary of $102,000 and will
increase to $135,000 for the remaining two years of the agreement if the Company
achieves certain benchmarks. Additionally, this individual will be entitled to a
bonus of $13,000 by September 2003 if the Company achieves certain pro forma
income objectives. Additionally, the employee shall be entitled to a 13.33%
ownership interest in FHS if the employee meets certain financial results as
outlined in the agreement. This employment agreement was terminated in 2003 (See
Note 8 - Litigation).

                                      F-23
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2003


NOTE 8 - COMMITMENTS AND CONTINGENCIES (CONTINUED)

On October 3, 2002, the Company's FHS subsidiary entered into an employment
agreement with its Director of Industrial Programs/Business Development. The
term of the agreement is for three years with a base salary of $102,000 and will
increase to $135,000 for the remaining two years of the agreement if the Company
achieves certain benchmarks. The Company has also agreed to pay unpaid and
accrued back wages and expenses of approximately $17,000. Additionally, this
individual will be entitled to a bonus of $13,000 by September 2003 if the
Company achieves certain pro forma income objectives. Additionally, the employee
shall be entitled to a 13.33% ownership interest in FHS if the employee meets
certain financial results as outlined in the agreement. This employment
agreement was terminated in 2003 (See Note 8 - Litigation).

On October 3, 2002, the Company's FHS subsidiary entered into an employment
agreement with its Director of Network Operations and Business Development. The
term of the agreement is for three years with a base salary of $102,000 and will
increase to $135,000 for the remaining two years of the agreement if the Company
achieves certain benchmarks. Additionally, this individual will be entitled to a
bonus of $13,000 by September 2003 if the Company achieves certain pro forma
income objectives. Additionally, the employee shall be entitled to a 13.33%
ownership interest in FHS if the employee meets certain financial results as
outlined in the agreement. This employment agreement was terminated in 2003 (See
Note 8 - Litigation).

NOTE 9 - CONCENTRATIONS

CUSTOMER SALES AND ACCOUNTS RECEIVABLE

The Company sells its services predominantly within Palm Beach, Dade and Broward
Counties, Florida. The Company performs ongoing credit evaluations of its
customers' financial conditions and, generally, requires no collateral from its
customers. The Company's three largest customers accounted for approximately 19%
and 81% of sales and approximately 52% and 22% of accounts receivable for the
periods ended December 31, 2003 and 2002, respectively.

NOTE 10 - MANAGEMENT'S CONSIDERATION OF GOING CONCERN MATTERS

As reflected in the accompanying consolidated financial statements, the Company
has a working capital deficiency of $1,900,961 at December 31, 2003, and has an
accumulated deficit of $6,413,941. The ability of the Company to continue as a
going concern is dependent on the continuation of profitable operations, its
ability to maintain positive cash flows from operations, and the obtaining
additional equity and/or debt financing to pay off outstanding debt obligations
and unpaid payroll taxes.

There can be no assurance that the Company's efforts will be successful. The
consolidated financial statements do not include any adjustments that might be
necessary if the Company is unable to continue as a going concern. No estimate
has been made should management's plan be unsuccessful.

                                      F-24
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2003


NOTE 11 - SEGMENT INFORMATION

In fiscal 2003 and 2002, the Company operates in two reportable business
segments - (1) healthcare transaction management and technology services and (2)
physical therapy and rehabilitation services. The healthcare transaction
management and technology services segment provides the healthcare industry with
a combination of administrative services and technology development, including
but not limited to physicians practice management, billing and collections,
network services and software application development. The physical therapy and
rehabilitation services segment operates multi-disciplinary clinics offering
physical therapy, occupational medicine, pain management, chiropractic care and
wellness services. The Company's reportable segments are strategic business
units that offer different products, which compliment each other. They are
managed separately based on the fundamental differences in their operations.

Information with respect to these reportable business segments for the years
ended December 31, 2003 and 2002 is as follows.

                                                    For the           For the
                                                  Year Ended        Year Ended
                                                  December 31,      December 31,
                                                      2003              2002
                                                  ------------      ------------
                              NET REVENUES:
                     Healthcare Transaction
                  Management and Technology ..... $ 2,684,452        $3,145,504
        Physical Therapy and Rehabilitation .....     643,400            74,600
                                                  -----------        ----------
                   Consolidated Net Revenue .....   3,327,852         3,220,104

                        OPERATING EXPENSES:
                     Healthcare Transaction
                  Management and Technology .....   5,384,478         2,640,939
        Physical Therapy and Rehabilitation .....   1,014,811           158,841

                              DEPRECIATION:
                     Healthcare Transaction
                  Management and Technology .....     162,307           115,138
        Physical Therapy and Rehabilitation .....      10,067               688

                          INTEREST EXPENSE:
                     Healthcare Transaction
                  Management and Technology .....     350,247           430,867
        Physical Therapy and Rehabilitation .....       4,505                 -

                             INCOME (LOSS):
                     Healthcare Transaction
                  Management and Technology ..... $(3,212,580)       $  248,222
        Physical Therapy and Rehabilitation .....    (385,983)          (84,929)
                                                  -----------        ----------
                          NET INCOME( LOSS) ..... $(3,598,563)       $  163,293
                                                  ===========        ==========
TOTAL ASSETS AT DECEMBER 31, 2003 AND 2002:
                     Healthcare Transaction
                  Management and Technology ..... $ 1,373,809        $  397,297
        Physical Therapy and Rehabilitation .....     130,379           178,821
                                                  -----------        ----------
                   Consolidated Asset Total ..... $ 1,504,188        $  573,118
                                                  ===========        ==========

                                      F-25
<PAGE>
                        IBX GROUP, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2003


NOTE 12 - SUBSEQUENT EVENTS

Subsequent to December 31, 2003, the Company issued 2,880,000 shares of common
stock for net proceeds of $144,000.

On January 29, 2004, the Company signed a promissory note with a shareholder for
$200,000. This note provides for 7.5% interest, a maturity date of January 31,
2005 and is unsecured. The note is convertible to common stock. The conversion
price is at 25% of the offering price any offering by the Company.

On February 17, 2004, the Company's board of directors adopted an article of
amendment for 1,000,000 shares of the 5,000,000 shares of preferred stock
designating it as Series B 8% Convertible Preferred Stock or Series B preferred
stock. The holder of shares of the Series B preferred stock will be entitled to
all dividends declared by the board of directors at a rate of $80.00 per share
per annum. Dividends are not cumulative and will not accrue. The holder will be
entitled to convert each share of Series B preferred stock for 2,000 shares of
common stock, subject to adjustment upon the occurrence of certain limited
events as specified in the articles of amendment. Each share will be entitled to
a liquidation preference of $1,000.00 per share plus any declared but unpaid
dividend. The Series B preferred stock will have voting rights as if converted
into common stock and will vote as a class with the common stock on all matters.
Certain protective provisions apply that limits the Company's authority to a)
issue new classes of capital stock senior to the series B preferred, and b) sell
or merge the Company.

During February and March 2004, the Company completed a private placement to two
accredited investors in which we issued an aggregate of 1,500 shares of Series B
Preferred Stock convertible into 3,000,000 shares of common stock, warrants
entitling the holders to purchase up to 1,500,000 shares of our common stock at
an exercise price of $0.10 per share expiring on December 31, 2005. The Company
agreed to file a registration statement with the SEC to permit the public resale
of the shares of our common stock issuable upon the exercise of the warrants as
soon as possible after the closing date of the transaction.

In March 2004, a shareholder of the Company agreed to convert accrued expenses
of approximately $135,000 into a half unit of the private placement, with the
remainder paid $10,000 per month until paid in full. The half unit represents
500 shares of Series B Preferred Stock and 500,000 warrants to purchase common
stock at an exercise price of $.10 per share.

On March 14, 2004, the Company signed a promissory note with a shareholder for
$174,000 which converted to a note payable amounts due to this shareholder of
approximately $69,000 and additional borrowing of $105,000. The note provides
for 8% interest, a maturity date of March 12, 2005 and a security interest in
all of the Company's assets. The Company is required to provide the holder with
90 days' notice of any prepayment, although there is no prepayment penalty. The
note is convertible to common stock. The conversion price is the lowest of
$.035, 70% of the closing bid price on the date of conversion or 70% of the
offering price any offering by the Company until March 2005. The Company agreed
to include the shares issuable upon the exercise of this note in this
registration statement.

                                      F-26