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

FORM 10-KSB

(Mark One)

x Annual Report
  Pursuant To Section 13 Or 15(D) Of The Securities Exchange Act Of 1934

For the fiscal year ended December 31, 2003

 ̈ Transition Report
  Under Section 13 Or 15(D) Of The Securities Exchange Act Of 1934

For the transition period from _____ to _____

COMMISSION FILE NUMBER 000-50033

MERRITT VENTURES CORP.(Name of small business issuer in its charter)

|NEVADA                                                         | 91-2147049                          
|-------------------------------------------------------------- | ------------------------------------
|(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.)
|                                                               |                                     
|810 Peace Portal Drive, Suite 201                              |                                     
|Blaine, Washington                                             | 98230                               
|(Address of principal executive offices)                       | (Zip Code)                          
|                                                               |                                     
|(360) 332-1752                                                 |                                     
|Issuer's telephone number                                      |                                     

Securities registered under Section 12(b) of the Exchange Act:

|Title of each class | Name of exchange on which registered
|------------------- | ------------------------------------
|None                | Not Applicable                      

Securities registered under Section 12(g) of the Exchange Act:

Common Stock, Par Value $0.001 Per Share(Title of class)

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

Check if there is no disclosure of delinquent filers in response
  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. x

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

State the aggregate market value of the voting and non-voting
  common equity held by non-affiliates computed by reference to the price at which
  the common equity was sold, or the average bid and asked price of such common
  equity, as of a specified date within the past 60 days. (See definition of affiliate
  in Rule 12b-2 of the Exchange Act.): $243,750.00.

State the number of shares outstanding of each of the issuer's
  classes of common equity, as of the latest practicable date: As of August
  23, 2004 the issuer had 7,437,500 shares of common stockoutstanding.

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DOCUMENTS INCORPORATED BY REFERENCE

If the following documents are incorporated by reference,
  briefly describe them and identify the part of the Form 10-KSB (e.g. Part I,
  Part II, etc.) in to which the document is incorporated: (1) any annual report
  to security holders; (2) any proxy or information statement; and (3) any prospectus
  filed pursuant to Rule 424(b) or (c) of the Securities Act of 1933 (Securities
  Act). The listed documents should be clearly described for identification
  purposes (e.g. annual report to security holders for fiscal year ended December
  24, 1990): None.

Transitional Small Business Disclosure Format (check one): Yes  ̈
  No x

2

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MERRITT VENTURES CORP.

ANNUAL REPORT ON FORM 10-KSB
  FOR THE FISCAL YEAR ENDED DECEMBER 31, 2003

INDEX

|         |                                                                                                                        | PAGE | 
|-------- | ---------------------------------------------------------------------------------------------------------------------- | ---- | 
|         |                                                                                                                        |      | 
|PART I   |                                                                                                                        |      | 
|         |                                                                                                                        |      | 
|Item 1.  | Description Of Business.                                                                                               | 4    | 
|         |                                                                                                                        |      | 
|Item 2.  | Description Of Property.                                                                                               | 5    | 
|         |                                                                                                                        |      | 
|Item 3.  | Legal Proceedings.                                                                                                     | 6    | 
|         |                                                                                                                        |      | 
|Item 4.  | Submission Of Matters To A Vote Of Security Holders.                                                                   | 6    | 
|         |                                                                                                                        |      | 
|PART II  |                                                                                                                        |      | 
|         |                                                                                                                        |      | 
|Item 5.  | Market For Common Equity And Related Stockholder Matters.                                                              | 7    | 
|         |                                                                                                                        |      | 
|Item 6.  | Management's Discussion And Analysis Or Plan Of Operation.                                                             | 8    | 
|         |                                                                                                                        |      | 
|Item 7.  | Financial Statements.                                                                                                  | 14   | 
|         |                                                                                                                        |      | 
|Item 8.  | Changes In And Disagreements With Accountants On Accounting
      And Financial Disclosure.                            | 15   | 
|         |                                                                                                                        |      | 
|Item 8A. | Controls and Procedures.                                                                                               | 15   | 
|         |                                                                                                                        |      | 
|Item 8B. | Other Information.                                                                                                     | 15   | 
|         |                                                                                                                        |      | 
|PART III |                                                                                                                        |      | 
|         |                                                                                                                        |      | 
|Item 9.  | Directors, Executive Officers, Promoters
      And Control Persons; Compliance With Section 16(A) Of The Exchange Act. | 16   | 
|         |                                                                                                                        |      | 
|Item 10. | Executive Compensation                                                                                                 | 17   | 
|         |                                                                                                                        |      | 
|Item 11. | Security Ownership Of Certain Beneficial Owners And
      Management                                                   | 18   | 
|         |                                                                                                                        |      | 
|Item 12. | Certain Relationships And Related Transactions                                                                         | 19   | 
|         |                                                                                                                        |      | 
|Item 13. | Exhibits.                                                                                                              | 19   | 
|         |                                                                                                                        |      | 
|Item 14. | Principal Accountant Fees and Services                                                                                 | 20   | 

3

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FORWARD LOOKING STATEMENTS

Certain statements contained in this Annual Report on Form
  10-KSB constitute "forward-looking statements" within the meaning of Section
  27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section
  21E of the Securities Exchange Act of 1934 (the Exchange Act). These
  statements, identified by words such as plan, "anticipate," "believe,"
  "estimate," "should," "expect" and similar expressions, include our expectations
  and objectives regarding our future financial position, operating results and
  business strategy. These statements reflect the current views of management
  with respect to future events and are subject to risks, uncertainties and other
  factors that may cause our actual results, performance or achievements, or industry
  results, to be materially different from those described in the forward-looking
  statements. Such risks and uncertainties include those set forth under the caption
  "Management's Discussion and Analysis or Plan of Operation" and elsewhere in
  this Form 10-KSB. We advise you to carefully review the reports and documents
  we file from time to time with the Securities and Exchange Commission (SEC),
  particularly our quarterly reports on Form 10-QSB and our current reports on
  Form 8-K.

As used in this Annual Report, the terms "we", "us", "our",
  the Company and Merritt mean Merritt Ventures Corp.
  unless otherwise indicated. All dollar amounts in this annual report are in
  U.S. dollars unless otherwise stated.

PART I

ITEM 1.     DESCRIPTION OF BUSINESS.

GENERAL

We were incorporated on February 20, 2001 under the laws of
  the State of Nevada. We are an exploration stage company engaged in the acquisition,
  exploration and development of mineral properties in the Province of British
  Columbia, Canada.

During the fiscal year ended December 31, 2003, we were primarily
  engaged in the exploration of four mineral claims located in the Vernon Mining
  Division in the Province of British Columbia, Canada that we referred to as
  the Zumar Mineral Claims. During this time, we owned an option to acquire a
  100% interest in the Zumar Mineral Claims. However, on December 31, 2003, we
  allowed this option to expire. As a result, we no longer have an interest in
  the Zumar Mineral Claims.

Currently we own an interest in one property, which we refer
  to as the Claw Property. Our plan of operations for the next twelve months primarily
  involves conducting preliminary exploration and development work on this property
  in order to ascertain whether it possess commercially exploitable mineral deposits.
  To date, no commercially viable mineral deposits have been identified on the
  Claw Property and there is no assurance that any commercially viable mineral
  deposits exist on the property.

We are currently in discussions to acquire a company engaged
  in the business of selling and providing support services for telecommunications
  switching equipment and an affiliated real estate holding company. If we are
  successful in acquiring these companies, of which there can be no assurance,
  it is expected that we will abandon our mineral exploration business to focus
  our resources on the target businesses. If we are not successful in completing
  the acquisition of these companies, we will continue with our mineral exploration
  business. See Item 6. Managements Discussion and Analysis or Plan
  of Operation and Item 8B. Other Information.

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ITEM 2.     DESCRIPTION OF PROPERTY.

THE CLAW PROPERTY

Location and Access to the Claw Property

The Claw Property consists of one mineral claim which is centered
  upon the Klawli copper-gold-silver showing, located in the Omineca Mining Division,
  approximately 160 kilometers northwest of Fort St. James in the Province of
  British Columbia, Canada. There are currently no access roads leading onto the
  Claw Property. The Claw Property is approximately 18 kilometers away from the
  nearest logging road. Approximately 10 of those 18 kilometers is accessible
  by a rough cat trail, accessible by all-terrain vehicle during low runoff periods.
  The final 8 kilometers must be traversed by foot or by helicopter.

The mineral claims constituting the Claw Property were recorded
  with the Ministry of Energy and Mines for the Province of British Columbia under
  the following names and claim numbers:

|Name of Mining Claim | Tag Number | Tenure Number | Expiry Date 
|-------------------- | ---------- | ------------- | ------------
|Claw 1               | 213688     | 394095        | June 7, 2005

Ownership Interest

Effective May 5, 2004, we entered into an option agreement
  (the Claw Option Agreement) with International Arimex Resources
  Inc. (International Arimex), pursuant to which we were granted an
  exclusive option to acquire up to a 75% undivided interest in the Claw Property.
  Under the original terms of the Claw Option Agreement, we had rights to acquire
  four mineral claims named Claw 1, Claw 2, Claw 3 and Claw 4 and were required
  to incur aggregate expenditures of $325,000 on the Claw Property in order to
  exercise our option rights. We amended the terms of the Claw Option Agreement
  with International Arimex on August 18, 2004. The Claw Option Agreement now
  includes only the Claw 1 mineral claim with minimum expenditure requirements
  of $81,250.

In order to exercise our rights under the Claw Option Agreement,
  as amended, we are required to incur expenditures on the exploration, maintenance
  or development of the Claw Property as follows:

|1. | $6,250 on or before December 31, 2004 to earn a 10% undivided interest
      in the Claw Property;                       
|-- | -------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                          
|2. | a further $25,000 on or before June 30, 2005 to earn an additional 25%
      undivided interest in the Claw Property; and
|   |                                                                                                                          
|3. | a further $50,000 on or before December 31, 2005 to earn an additional
      40% undivided interest in the Claw Property.

In order to maintain our rights under the Claw Option Agreement, we are required
  to:

|1. | pay an additional $1,250 to International Arimex
        upon their obtaining regulatory approval of the Claw Option Agreement
        from the TSX Venture Exchange, or their obtaining a legal opinion that
        such approval is not required; and
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                         
|2. | provide International Arimex with evidence that we have arranged for
      financing in the amount of $10,000 by September 30, 2004.                                                                                                                    

Upon our earning the first 60% undivided interest in the Claw
  Property, we will enter into a joint venture agreement with International Arimex
  to carry out the continued exploration and development of the Claw Property.

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The Claw Option Agreement is subject to a royalty of 3% of
  any net smelter returns, payable to John Robert Dahrouge and Lenyoran Enterprises
  Ltd. as set out in an agreement between International Arimex, Mr. Dahrouge and
  Lenyoran Enterprises Ltd. dated September 19, 2002.

History and Previous Operations on the Claw Property

The Klawli showing was originally discovered in the 1920s.
  Since that time, it has been sporadically explored. Several companies including
  Consolidated Mining and Smelting Company of Canada, Quebec Gold Mining Corp.,
  Tro-Butte Exploration Ltd., Phelps Dodge Corp., Hawks Mountain Resources and
  Eric Shaede have conducted exploration within the area. The most recent exploration
  of the Claw Property was conducted by Noranda Exploration Company Ltd. in the
  early 1990s.

Prior exploration of the Claw mineral claims consisted primarily
  of rock and soil sampling, trenching, and the construction of adits. Noranda
  conducted an extensive program of soil sampling and ground geophysics immediately
  east of the Klawli showing.

Present Condition and Current State of Exploration on the Claw Property

Our proposed program for the Claw Property is exploratory
  in nature. No mineral reserves have been identified on the Claw Property and
  there is no assurance that any such reserves will be identified in the future.
  Currently there is no access road leading on to the Claw Property.

In September, 2003, International Arimex received an assessment
  report on the Claw Property from Dahrouge Geological Consulting Ltd. (Dahrouge
  Consulting). One of the authors of the report was Jody Dahrouge, a director
  of International Arimex. The work conducted by Dahrouge Consulting consisted
  of the collection of nine rock samples and the scouting of potential access
  routes to the Claw Property. The assessment report laid out a proposed access
  route and recommended the excavation of trenches.

Our proposed exploration and development program will involve
  the construction of an access road utilizing the existing cat trail and the
  excavation of trenches in targeted areas on the Claw Property. In the event
  we receive favorable trenching results, we will begin drilling of those targeted
  areas.

Geology of the Claw Property

According to the assessment report by Dahrouge Consulting,
  there exists on the Claw Property alkalic volcanic rock with variable degrees
  of alteration. Disseminated zones of pyrite, pyrrhotite, chalcopyrite, malachite
  and azurite were identified within the trenches. Although no shear indicators
  were reported, the gold-silver mineralization has been interpreted in assessment
  reports prepared by previous operators of the Claw Property as part of a 5 to
  15 meter wide shear-zone associated with pyrrhotite. The mineralized quartz-carbonate
  veins are, in general, typical of base-precious metal veins peripheral to porphyry
  copper-gold systems. Generally, porphyry copper-gold systems are considered
  to be promising exploration targets.

Porphyry mineral systems are disseminated low-grade deposits
  in which the minerals occur as discrete grains and/or veins throughout a large
  volume of rock. However, when found in large tonnages, porphyry systems can
  provide commercially viable quantities of ore. In British Columbia, most copper
  reserves and approximately half of the gold reserves are within porphyry deposits.

ITEM 3.     LEGAL PROCEEDINGS.

We are not currently a party to any material legal proceedings and, to our knowledge, no such proceedings are threatened or contemplated.

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

No matters were submitted to a vote of our security holders
  during the fourth quarter of 2003 and no matters have been submitted to a vote
  of our security holders since the end of our 2003 fiscal year.

6

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PART II

ITEM 5.     MARKET FOR COMMON EQUITY AND RELATED
  STOCKHOLDER MATTERS.

There is presently no public trading market for our common
  stock and we can provide no assurance that a public trading market for our shares
  will materialize.

Registered Holders Of Our Common Stock

As of August 23, 2004, there were approximately 25 stockholders of record of our common stock.

Dividends

No cash dividends have been declared with respect to our common
  stock since inception. We are not likely to pay any dividends in the foreseeable
  future.

Recent Sales Of Unregistered Securities

On March 9, 2001, we issued a total of 5,000,000 shares of
  our common stock at a price of $0.001 per share for total proceeds of $5,000
  to Gordon F. Burley and Lorrie Ann Archibald. These shares were issued pursuant
  to the exemption to registration provided under Section 4(2) of the Securities
  Act on the basis that the issuance of those shares did not involve a public
  offering of securities.

On March 23, 2001, we issued a total of 2,000,000 shares of
  our common stock at a price of $0.01 per share for total proceeds of $20,000.
  These shares were issued pursuant to the exemptions to registration provided
  under Regulation S of the Exchange Act on the basis that the recipients represented
  to us that they were not U.S. persons as that term is defined under
  Regulation S.

On November 20,2001, we issued a total of 437,500
  shares of our common stock at a price of $0.10 per share for total proceeds
  of $43,750. These shares were issued pursuant to the exemptions to registration
  provided under Regulation S of the Exchange Act on the basis that the recipients
  represented to us that they were not U.S. persons as that term is
  defined under Regulation S.

Proposed Private Placement Of Securities

On September 22, 2004, we approved a private placement offering
  of 5,000,000 units at a price of $0.25 per unit for total potential proceeds
  of $1,250,000 (the Offering). Each unit issued under the Offering
  will consist of one share of our common stock and one share purchase warrant
  entitling the holder to purchase one share of our common stock at a price of
  $0.50 per share for a period of one year from the date of issuance. The proceeds
  of the Offering are intended to be used by us to fund our proposed business
  acquisitions. See Item 8B. Other Information. Although we have approved
  the above private placement, there is no assurance that the private placement
  will actually be completed or that we will be able to sell all of the units
  offered.

If the proposed private placement is completed, it is expected
  that any issuances of our securities will be made pursuant to the exemptions
  to registration contained in Regulation S of the Securities Act on the basis
  that the offering will be made only to people who are not U.S. persons
  as defined under Regulation S.

Penny Stock Rules

The SEC has adopted rules that regulate broker-dealer practices
  in connection with transactions in penny stocks. Penny stocks are generally
  equity securities with a price of less than $5.00, other than securities registered
  on certain national securities exchanges or quoted on the Nasdaq system, provided
  that current price and volume information with respect to transactions in such
  securities is provided by the exchange or system. The penny stock rules require
  a broker-dealer, prior to a transaction in a penny stock not otherwise

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exempt from those rules, to deliver a standardized risk disclosure
  document prepared by the Commission, which: (a) contains a description of the
  nature and level of risk in the market for penny stocks in both public offerings
  and secondary trading; (b) contains a description of the broker's or dealer's
  duties to the customer and of the rights and remedies available to the customer
  with respect to a violation of such duties or other requirements of securities
  laws; (c) contains a brief, clear, narrative description of a dealer market,
  including bid and ask prices for penny stocks and the significance of the spread
  between the bid and ask price; (d) contains a toll-free telephone number for
  inquiries on disciplinary actions; (e) defines significant terms in the disclosure
  document or in the conduct of trading in penny stocks; and (f) contains such
  other information and in such form as the Commission shall require by rule or
  regulation. The broker-dealer also must, prior to effecting any transaction
  in a penny stock, provide the customer with: (a) bid and offer quotations for
  the penny stock; (b) the compensation of the broker-dealer and its salesperson
  in the transaction; (c) the number of shares to which such bid and ask prices
  apply, or other comparable information relating to the depth and liquidity of
  the market for such stock; and (d) monthly account statements showing the market
  value of each penny stock held in the customer's account. In addition, the penny
  stock rules require that, prior to a transaction in a penny stock that is not
  otherwise exempt from those rules, the broker-dealer must: (a) make a special
  written determination that the penny stock is a suitable investment for the
  purchaser and (b) receive from the purchaser his or her written acknowledgement
  of receipt of the determination and a written agreement to the transaction.

These disclosure requirements may have the effect of reducing
  the trading activity in the secondary market for our common stock and therefore
  stockholders may have difficulty selling those securities.

ITEM 6.     MANAGEMENT'S DISCUSSION AND ANALYSIS
  OR PLAN OF OPERATION.

PLAN OF OPERATIONS

Subject to the completion of our proposed business acquisition,
  our plan of operations for the next twelve months involves spending approximately
  $81,250 on the continued exploration and development of the Claw Property. It
  is expected that these amounts will be spent on the construction of an access
  road onto the Claw Property and the excavation of trenches in targeted areas.
  In the event that the results of the trenching activities are favorable, we
  intend to begin drilling of those targeted areas.

As of June 30, 2004, we had cash in the amount of $25. It
  is anticipated that we will not generate any revenues over the next twelve months.
  Accordingly, we will require substantial additional financing in order to fund
  our plan of operations.

If we are successful in completing the proposed acquisitions
  as discussed below, of which there is no assurance, it is expected that we will
  abandon our mineral exploration business to focus on the businesses of the target
  companies. We are currently in negotiations with respect to the proposed acquisitions
  and have not yet reached an agreement for the acquisition of those companies.
  If we are successful in reaching an agreement, of which there is no assurance,
  it is expected that we will require substantial financing in order to complete
  the proposed acquisitions. See Item 8B. Other Information.

We have approved a private placement offering of 5,000,000
  units at $0.25 for total potential proceeds of $1,250,000. However, there is
  no assurance that the proposed private placement will be completed or that we
  will be able to sell all units offered under the proposed private placement.
  Even if all units offered are sold under the proposed private placement, there
  is no assurance that these funds will be sufficient to allow us to complete
  the proposed business acquisitions described below. See Item 5. Market
  for Common Equity and Related Stockholder Matters and Item 8B. Other
  Information.

If we are not able to complete the proposed private placement
  or if the proposed private placement does not provide us with sufficient financing
  to enable us to fund our plan of operations or the proposed acquisition, then
  we will have to seek additional sources of financing. An inability to raise
  the necessary financing may result in us forfeiting our rights under the Claw
  Option Agreement or under any agreement which may be reached with respect to
  the proposed acquisitions.

8

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RESULTS OF OPERATIONS

Summary of Year End Results

|                  | Year Ended December
      31
|----------------- | ----------------------------
|                  |                             
|                  | 2003                        
|Revenue           | $Nil.                       
|Expenses          | (32,516)                    
|Net Income (Loss) | ($32,516)                   

Revenue

We have not earned any revenues since our inception and we
  do not anticipate earning revenues until such time as we have entered into commercial
  production of our mineral properties. We are currently in the exploration stage
  of our business and we can provide no assurances that we will discover commercially
  exploitable levels of mineral resources on our properties, or if such resources
  are discovered, that we will be able to enter into commercial production of
  our mineral properties.

Expenses

The major components of our operating expenses are outlined in the table below:

|                                 | Year Ended December
      31
|-------------------------------- | ----------------------------
|                                 |                             
|                                 | 2003                        
|Rent                             | $3,000                      
|Professional Fees                | 20,921                      
|Regulatory Fees                  | 970                         
|Administrative Fees              | 6,068                       
|Mineral Property Option Payments | 1,000                       
|Exploration Expenses             | Nil.                        
|Office and Sundry                | 557                         
|Total                            | $32,516                     

We anticipate that our operating expenses will increase as
  we undertake our plan of operations and pursue our exploration program for the
  Claw Property.

LIQUIDITY AND CAPITAL RESOURCES

Working Capital

|                                  |                  |                  | Percentage           
|--------------------------------- | ---------------- | ---------------- | ---------------------
|                                  | At Dec. 31, 2003 | At Dec. 31, 2002 | Increase / (Decrease)
|Current Assets                    | $945             | $3,392           | 72%                  
|Current Liabilities               | (30,069)         | Nil.             | N/A                  
|Working Capital Surplus (Deficit) | $(29,124)        | $3,392           | (959%)               

9

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Our liquidity position changed from a working capital surplus
  to a substantial working capital deficit of $29,124 as a result of the fact
  that we had no revenues or substantial sources of financing during the year
  ended December 31, 2003. As of June 30, 2004 we had cash in the amount of $25.

We currently do not have sufficient resources to finance our
  exploration program for the Claw Property. Our directors have orally agreed
  to advance additional capital to us if needed in order for us to meet any commitments,
  including our planned exploration programs and any professional fees. However,
  there is no assurance that our directors will continue to provide us with sufficient
  financing in order to allow us to continue operations.

Cash Flows

|                                              | Year Ended Dec.
      31
|--------------------------------------------- | ------------------------
|                                              | 2003                    
|Net Cash from (used in) Operating Activities  | $(1,697)                
|Net Cash from (used in) Financing Activities  | Nil.                    
|Net Increase (decrease) in Cash During Period | $(1,697)                

As we had no revenue and obtained no financing during the fiscal year ended December 31, 2003, we had negative cash flows for the year.

OFF-BALANCE SHEET ARRANGEMENTS

We have no significant off-balance sheet arrangements that
  have or are reasonably likely to have a material current or future effect on
  our financial condition, changes in financial condition, revenues or expenses,
  results of operations, liquidity, capital expenditures or capital resources.

CRITICAL ACCOUNTING POLICIES

We adhere to the following significant accounting policies in the preparation
  of our financial statements:

|(1) | Mineral Property Option Payments and Exploration
        Costs
      We expense all costs related to the maintenance and exploration of mineral
        claims to which we have secured exploration rights prior to the establishment
        of proven and probable reserves. To date, we have not established the
        commercial feasibility of our exploration prospects, therefore all costs
        are being expensed.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                 
|(2) | Foreign Currency Translation
      Our functional currency is the U.S. dollar. Transactions in foreign
        currency are translated into U.S. dollars as follows:                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    | i)                                                                                                                                                                                                                                                                                                                                                                                                                              
|    | ii)                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | iii)                                                                                                                                                                                                                                                                                                                                                                                                                            

10

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RISK FACTORS

If we do not obtain additional financing, our business will fail

Our current operating funds are inadequate to complete our
  planned exploration of the Claw Property. Our business plan calls for significant
  expenses in connection with the exploration and development of those mineral
  claims. However, as of June 30, 2004, we had cash in the amount of $25 and we
  currently do not have any operations or income. As a result, we will require
  additional financing to continue with our exploration and development plans.
  We will also require additional financing if the costs of exploration are greater
  than anticipated and to sustain our business operations if we are not successful
  in earning revenues once exploration is complete.

We currently do not have any arrangements for financing and
  we may not be able to obtain financing when required. Obtaining additional financing
  would be subject to a number of factors, the known material factors being market
  prices for gold and silver, investor acceptance of our mineral claims, and investor
  sentiment. These factors may make the timing, amount, terms or conditions of
  additional financing unavailable to us.

If we complete a financing through the sale of additional shares of our common stock, shareholders will experience dilution

The most likely source of future financing presently available
  to us is through the issuance of our common stock. Any sale of share capital
  will result in dilution to existing shareholders. The only other anticipated
  alternative for the financing of further exploration would be the offering by
  us of an interest in our properties to be earned by another party or parties
  carrying out further exploration thereof, which is not presently contemplated.

If we do not conduct mineral exploration on our mineral claims or pay fees in lieu of mineral exploration, then these mineral claims will lapse

We must complete mineral exploration work on the Claw Property
  and make filings with the Canadian regulatory authorities regarding the work
  completed or pay filing fees in lieu of completing work on these claims. A failure
  to do so will cause our rights to the Claw Property to lapse and we will lose
  all interest that we have in these mineral claims. The expiration date of the
  mineral claims related to the Claw Property is currently June 7, 2005.

Because we have not commenced business operations, we face a high risk of business failure

We were incorporated on February 20, 2001 and to date have
  been involved primarily in organizational activities, the acquisition of mineral
  claims and the exploration and development on these claims. We have not earned
  any revenues as of the date of this Annual Report. Potential investors should
  be aware of the difficulties normally encountered by new mineral exploration
  companies and the high rate of failure of such enterprises. The likelihood of
  success must be considered in light of the problems, expenses, difficulties,
  complications and delays encountered in connection with the exploration of the
  mineral properties that we plan to undertake. These potential problems include,
  but are not limited to, unanticipated problems relating to exploration, and
  additional costs and expenses that may exceed current estimates.

Because we anticipate our operating expenses will increase prior to our earning revenues, we may never achieve profitability

Prior to completion of our exploration stage, we anticipate
  that we will incur increased operating expenses without realizing any revenues.
  We therefore expect to incur significant losses into the foreseeable future.
  We recognize that if we are unable to generate significant revenues from the
  exploration of our mineral claims and the production of minerals thereon, if
  any, we will not be able to earn profits or continue operations. There is no
  history upon which to base any assumption as to the likelihood that we will
  prove successful, and we may not be able to ever generate any operating revenues
  or achieve profitable operations. If we are unsuccessful in addressing these
  risks, our business will most likely fail.

11

---

Because of the speculative nature of exploration of mining
  properties, there is substantial risk that no commercially exploitable minerals
  will be found and our business will fail

The search for valuable minerals as a business is extremely
  risky. We may not find commercially exploitable reserves of gold or silver on
  our mineral claims. Exploration for minerals is a speculative venture, necessarily
  involving substantial risk. The expenditures to be made by us in the upcoming
  exploration of the mineral claims may not result in the discovery of commercial
  quantities of ore. Problems such as unusual or unexpected formations and other
  conditions are involved in mineral exploration and often result in unsuccessful
  exploration efforts. In such a case, we would be unable to complete our business
  plan.

Because of the inherent dangers involved in mineral exploration,
  there is a risk that we may incur liability or damages if and when we conduct
  mineral exploration activities

The search for valuable minerals involves numerous hazards.
  As a result, if and when we conduct exploration activities we may become subject
  to liability for such hazards, including pollution, cave-ins and other hazards
  against which we cannot insure or against which we may elect not to insure.
  The payment of such liabilities may have a material adverse effect on our financial
  position.

Even if we discover commercial reserves of precious metals
  on our optioned mineral claims, we may not be able to successfully obtain commercial
  production

Our optioned mineral claims do not contain any known bodies
  of ore. If our exploration programs are successful in discovering ore of commercial
  tonnage and grade, we will require additional funds in order to place those
  mineral claims into commercial production. At this time, there is a risk that
  we will not be able to obtain such financing as and when needed.

Because access to our mineral claims may be restricted
  by inclement weather, we may be delayed in our future exploration

Access to the our mineral claims may be restricted through
  some of the year due to weather in the area. As a result, any attempt to test
  or explore the property is largely limited to the times when weather permits
  such activities. These limitations can result in significant delays in future
  exploration efforts, as well as mining and production in the event that commercial
  amounts of minerals are found. Such delays can have a significant negative effect
  on our results of operations.

Because we are an exploration stage company, our business
  has a high risk of failure

As noted in the financial statements that are included with
  this Annual Report, we are an exploration stage company that has incurred net
  losses since inception, we have not attained profitable operations and we are
  dependent upon obtaining adequate financing to complete our exploration activities.
  These conditions, as indicated in the audit report of Morgan & Company,
  Chartered Accountants, raise substantial doubt as to our continuance as a going
  concern. The success of our business operations will depend upon our ability
  to obtain further financing to complete our planned exploration program and
  to attain profitable operations. If we are not able to complete a successful
  exploration program and attain sustainable profitable operations, then our business
  will fail.

If we are unable to hire and retain key personnel, we may
  not be able to implement our business plan and our business will fail

Our success will largely depend on our ability to hire highly
  qualified personnel with experience in geological exploration. These individuals
  may be in high demand and we may not be able to attract the staff we need. In
  addition, we may not be able to afford the high salaries and fees demanded by
  qualified personnel, or may lose such employees after they are hired. Currently,
  we have not hired any key personnel. Our failure to hire key personnel when
  needed could have a significant negative effect on our business.

12

---

Because our president and secretary have only agreed to
  provide their services on a part-time basis, they may not be able or willing
  to devote a sufficient amount of time to our business operations, causing our
  business to fail

Ms. Archibald, our President and Chief Executive Officer,
  and Mr. Burley, our Secretary, Treasurer and Chief Financial Officer, provide
  their services on a part-time basis. Our officers may pursue other business
  activities, provided that these other activities do not interfere with their
  obligations to us. Ms. Archibald and Mr. Burley devote their full-time attention
  to other business pursuits. It is therefore possible that over time, Ms. Archibald
  and Mr. Burley may not be able to devote sufficient time to the management of
  our business, as and when needed.

Because our executive officers do not have formal training
  specific to the technicalities of mineral exploration, there is a higher risk
  our business will fail

Ms. Archibald and Ms. Burley, our executive officers and directors,
  do not have formal training as geologists or in the technical aspects of management
  of a mineral exploration company. Accordingly, we will have to rely on the technical
  services of others trained in appropriate areas. If we are unable to contract
  for the services of such individuals, it will make it difficult and maybe impossible
  to pursue our business plan.

As we undertake exploration of our optioned mineral claims,
  we will be subject to compliance with government regulation that may increase
  the anticipated cost of our exploration program

There are several government regulations that materially restrict
  the exploration of minerals. We may be required to obtain work permits, post
  bonds and perform remediation work for any physical disturbance to the land
  in order to comply with these laws. While our planned exploration program budgets
  for regulatory compliance, there is a risk that new regulations could increase
  our costs of doing business and prevent us from carrying out our exploration
  program.

If we receive positive results from our exploration program
  and we decide to pursue commercial production, we may be subject to an environmental
  review process that may delay or prohibit commercial production

If the results of our geological exploration program indicate
  commercially exploitable reserves, and we decide to pursue commercial production
  of our mineral claims, we may be subject to an environmental review process
  under environmental assessment legislation. Compliance with an environmental
  review process may be costly and may delay commercial production. Furthermore,
  there is the possibility that we would not be able to proceed with commercial
  production upon completion of the environmental review process if government
  authorities did not approve our mine or if the costs of compliance with government
  regulation adversely affected the commercial viability of the proposed mine.

13

---

ITEM 7.     FINANCIAL STATEMENTS.

Index to Financial Statements:

|1. | Auditors Report;                                                                  
|-- | -----------------------------------------------------------------------------------
|   |                                                                                    
|2. | Audited Financial Statements for the year ended
      December 31, 2003, including:
|   |                                                                                    
|   | a.                                                                                 
|   |                                                                                    
|   | b.                                                                                 
|   |                                                                                    
|   | c.                                                                                 
|   |                                                                                    
|   | d.                                                                                 
|   |                                                                                    
|   | e.                                                                                 

14

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MERRITT VENTURES CORP.(An Exploration Stage Company)

FINANCIAL STATEMENTS

DECEMBER 31, 2003 AND 2002(Stated in U.S. Dollars)



F-1

---






AUDITORS' REPORT

To the Shareholders and Directors of 
  Merritt Ventures Corp. 
  (An exploration stage company)

We have audited the balance sheets of Merritt Ventures Corp.
  (an exploration stage company) as at December 31, 2003 and 2002, and the statements
  of loss and deficit accumulated during the exploration stage, cash flows, and
  stockholders' equity for the years ended December 31, 2003 and 2002, and for
  the period from inception, February 20, 2001, to December 31, 2003. These financial
  statements are the responsibility of the Company's management. Our responsibility
  is to express an opinion on these financial statements based on our audits.

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

In our opinion, these financial statements present fairly,
  in all material respects, the financial position of the Company as at December
  31, 2003 and 2002, and the results of its operations and cash flows for the
  years ended December 31, 2003 and 2002, and for the period from inception, February
  20, 2001, to December 31, 2003 in accordance with United States generally accepted
  accounting principles.

The accompanying financial statements have been prepared assuming
  the Company will continue as a going concern. As discussed in Note 1 to the
  financial statements, the Company has incurred a net loss of $97,874 since inception,
  has not attained profitable operations and is dependent upon obtaining adequate
  financing to fulfil its exploration activities. These factors raise substantial
  doubt that the Company will be able to continue as a going concern. Management's
  plans in regard to these matters are also discussed in Note 1. The financial
  statements do not include any adjustments that might result from the outcome
  of this uncertainty.

|Vancouver, Canada |  | "Morgan & Company"   
|----------------- |  | ---------------------
|                  |  |                      
|June 16, 2004     |  | Chartered Accountants

|Tel: (604) 687-5841 |                                     | P.O. Box 10007 Pacific Centre
|------------------- | ----------------------------------- | -----------------------------
|fax: (604) 687-0075 | Sute 1488 - 700 West Georgia Street
|www.morgan-cas.com  | Vancouver, B.C. V7Y 1A1            

F-2

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MERRITT VENTURES CORP.(An Exploration Stage Company)

BALANCE SHEETS(Stated in U.S. Dollars)

|                                                               |   | DECEMBER 31 |  
|-------------------------------------------------------------- | - | ----------- | -
|                                                               |   | 2003        |  
|ASSETS                                                         |   |             |  
|                                                               |   |             |  
|Current                                                        |   |             |  
|Cash                                                           | $ | 945         |  
|Prepaid expenses                                               |   | -           |  
|                                                               | $ | 945         |  
|                                                               |   |             |  
|LIABILITIES                                                    |   |             |  
|                                                               |   |             |  
|Current                                                        |   |             |  
|Accounts payable                                               | $ | 30,069      |  
|                                                               |   |             |  
|SHAREHOLDER'S EQUITY (DEFICIENCY)                              |   |             |  
|                                                               |   |             |  
|Share Capital                                                  |   |             |  
|Authorized:                                                    |   |             |  
|100,000,000 common
      shares with a par value of $0.001 per |   |             |  
|share                                                          |   |             |  
|                                                               |   |             |  
|Issued:                                                        |   |             |  
|7,437,500 common
      shares                                  |   | 7,438       |  
|                                                               |   |             |  
|Additional paid-in capital                                     |   | 61,312      |  
|                                                               |   |             |  
|Deficit Accumulated During The Exploration Stage               |   | (97,874     | )
|                                                               |   | (29,124     | )
|                                                               |   |             |  
|                                                               | $ | 945         |  

F-3

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MERRITT VENTURES CORP.(An Exploration Stage Company)

STATEMENTS OF LOSS AND DEFICIT(Stated in U.S. Dollars)

|                                           |   |             |  |   |             |  |   | PERIOD FROM | 
|------------------------------------------ | - | ----------- |  | - | ----------- |  | - | ----------- | 
|                                           |   |             |  |   |             |  |   | INCEPTION   | 
|                                           |   |             |  |   |             |  |   | FEBRUARY 20 | 
|                                           |   | YEARS ENDED |  |   | 2001 TO     | 
|                                           |   | DECEMBER 31 |  |   | DECEMBER 31 | 
|                                           |   | 2003        |  |   | 2002        |  |   | 2003        | 
|                                           |   |             |  |   |             |  |   |             | 
|Expenses                                   |   |             |  |   |             |  |   |             | 
|Rent                                       | $ | 3,000       |  | $ | 2,750       |  | $ | 7,150       | 
|Professional fees                          |   | 20,921      |  |   | 32,194      |  |   | 63,002      | 
|Regulatory fees                            |   | 970         |  |   | 1,229       |  |   | 2,199       | 
|Administrative fees                        |   | 6,068       |  |   | 6,500       |  |   | 12,568      | 
|Office and sundry                          |   | 557         |  |   | 1,894       |  |   | 3,099       | 
|Mineral property option payments           |   | 1,000       |  |   | -           |  |   | 2,000       | 
|Exploration expenses                       |   | -           |  |   | 4,746       |  |   | 7,856       | 
|                                           |   |             |  |   |             |  |   |             | 
|Net Loss For The Year                      |   | 32,516      |  |   | 49,313      |  | $ | 97,874      | 
|                                           |   |             |  |   |             |  |   |             | 
|Deficit Accumulated During The Exploration |   |             |  |   |             |  |   |             | 
|Stage, Beginning Of Year                   |   | 65,358      |  |   | 16,045      |  |   |             | 
|                                           |   |             |  |   |             |  |   |             | 
|Deficit Accumulated During The Exploration |   |             |  |   |             |  |   |             | 
|Stage, End Of Year                         | $ | 97,874      |  | $ | 65,358      |  |   |             | 
|                                           |   |             |  |   |             |  |   |             | 
|                                           |   |             |  |   |             |  |   |             | 
|Basic And Diluted Loss Per Share           | $ | 0.01        |  | $ | 0.01        |  |   |             | 
|                                           |   |             |  |   |             |  |   |             | 
|                                           |   |             |  |   |             |  |   |             | 
|Weighted Average Number Of Shares          |   |             |  |   |             |  |   |             | 
|Outstanding                                |   | 7,437,500   |  |   | 7,437,500   |  |   |             | 

F-4

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MERRITT VENTURES CORP.(An Exploration Stage Company)

STATEMENTS OF CASH FLOWS(Stated in U.S. Dollars)

|                                         |   |             |   |   |             |   |   | PERIOD FROM |  
|---------------------------------------- | - | ----------- | - | - | ----------- | - | - | ----------- | -
|                                         |   |             |   |   |             |   |   | INCEPTION   |  
|                                         |   |             |   |   |             |   |   | FEBRUARY 20 |  
|                                         |   | YEARS ENDED |   |   | 2001 TO     |  
|                                         |   | DECEMBER 31 |   |   | DECEMBER 31 |  
|                                         |   | 2003        |   |   | 2002        |   |   | 2003        |  
|                                         |   |             |   |   |             |   |   |             |  
|Cash Flows From Operating Activities     |   |             |   |   |             |   |   |             |  
|Net loss for the year                    | $ | (32,516     | ) | $ | (49,313     | ) | $ | (97,874     | )
|                                         |   |             |   |   |             |   |   |             |  
|Adjustments To Reconcile Net Loss To Net |   |             |   |   |             |   |   |             |  
|Cash Used By Operating Activities        |   |             |   |   |             |   |   |             |  
|Change in accounts payable               |   | 30,069      |   |   | (1,500      | ) |   | 30,069      |  
|Change in due to shareholder             |   | -           |   |   | (1,000      | ) |   | -           |  
|Change in prepaid expenses               |   | 750         |   |   | (750        | ) |   | -           |  
|                                         |   | (1,697      | ) |   | (52,563     | ) |   | (67,805     | )
|                                         |   |             |   |   |             |   |   |             |  
|Cash Flows From Financing Activity       |   |             |   |   |             |   |   |             |  
|Issue of share capital                   |   | -           |   |   | -           |   |   | 68,750      |  
|                                         |   |             |   |   |             |   |   |             |  
|Increase (Decrease) In Cash              |   | (1,697      | ) |   | (52,563     | ) |   | 945         |  
|                                         |   |             |   |   |             |   |   |             |  
|Cash, Beginning Of Year                  |   | 2,642       |   |   | 55,205      |   |   | -           |  
|                                         |   |             |   |   |             |   |   |             |  
|Cash, End Of Year                        | $ | 945         |   | $ | 2,642       |   | $ | 945         |  

F-5

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MERRITT VENTURES CORP.(An Exploration Stage Company)

STATEMENT OF STOCKHOLDERS' EQUITY

DECEMBER 31, 2003(Stated in U.S. Dollars)

|                                 |              |  |   |             |  |   |            |  |   | DEFICIT     |   |   |         |  
|-------------------------------- | ------------ |  | - | ----------- |  | - | ---------- |  | - | ----------- | - | - | ------- | -
|                                 | COMMON STOCK |  |   | ACCUMULATED |  |   |            | 
|                                 | NUMBER OF    |  |   |             |  |   | ADDITIONAL |  |   | DURING THE  |   |   |         |  
|                                 | COMMON       |  |   | PAR         |  |   | PAID IN    |  |   | EXPLORATION |   |   |         |  
|                                 | SHARES       |  |   | VALUE       |  |   | CAPITAL    |  |   | STAGE       |   |   | TOTAL   |  
|Shares issued for cash at $0.001 | 5,000,000    |  | $ | 5,000       |  | $ | -          |  | $ | -           |   | $ | 5,000   |  
|Shares issued for cash at $0.01  | 2,000,000    |  |   | 2,000       |  |   | 18,000     |  |   | -           |   |   | 20,000  |  
|Shares issued for cash at $0.10  | 437,500      |  |   | 438         |  |   | 43,312     |  |   | -           |   |   | 43,750  |  
|Net loss for the period          | -            |  |   | -           |  |   | -          |  |   | (16,045     | ) |   | (16,045 | )
|Balance, December 31, 2001       | 7,437,500    |  |   | 7,438       |  |   | 61,312     |  |   | (16,045     | ) |   | 52,705  |  
|Net loss for the year            | -            |  |   | -           |  |   | -          |  |   | (49,313     | ) |   | (49,313 | )
|Balance, December 31, 2002       | 7,437,500    |  |   | 7,438       |  |   | 61,312     |  |   | (65,358     | ) |   | 3,392   |  
|Net loss for the year            | -            |  |   | -           |  |   | -          |  |   | (32,516     | ) |   | (32,516 | )
|Balance, December 31, 2003       | 7,437,500    |  | $ | 7,438       |  | $ | 61,312     |  | $ | (97,874     | ) | $ | (29,124 | )

F-6

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MERRITT VENTURES CORP.(An Exploration Stage Company)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2003 AND 2002(Stated in U.S. Dollars)

|1. | OPERATIONS
      Organization
      The Company was incorporated in the State of Nevada,
        U.S.A., on February 20, 2001.
      Exploration Stage Activities
      The Company has been in the exploration stage since
        its formation and has not yet realized any revenues from its planned operations.
        It is primarily engaged in the acquisition and exploration of mining properties.
        Upon location of a commercial minable reserve, the Company expects to
        actively prepare the site for its extraction and enter a development stage.
      Going Concern
      The accompanying financial statements have been prepared
        assuming the Company will continue as a going concern.
      As shown in the accompanying financial statements, the
        Company has incurred a net loss of $97,874 for the period from February
        20, 2001 (inception) to December 31, 2003, and has no sales. The future
        of the Company is dependent upon its ability to obtain financing and upon
        future profitable operations from the development of its mineral properties.
        Management has plans to seek additional capital through a private placement
        and public offering of its common stock. The financial statements do not
        include any adjustments relating to the recoverability and classification
        of recorded assets, or the amounts of and classification of liabilities
        that might be necessary in the event the Company cannot continue in existence.
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|2. | SIGNIFICANT ACCOUNTING POLICIES
      The financial statements of the Company have been prepared
        in accordance with generally accepted accounting principles in the United
        States. Because a precise determination of many assets and liabilities
        is dependent upon future events, the preparation of financial statements
        for a period necessarily involves the use of estimates which have been
        made using careful judgement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

F-7

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MERRITT VENTURES CORP.(An Exploration Stage Company)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2003 AND 2002(Stated in U.S. Dollars)

|2. | SIGNIFICANT ACCOUNTING POLICIES (Continued)
      The financial statements have, in management's opinion,
        been properly prepared within reasonable limits of materiality and within
        the framework of the significant accounting policies summarized below:
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                           

| | a) | Mineral Property Option Payments and Exploration
        Costs
      The Company expenses all costs related to the maintenance
        and exploration of mineral claims in which it has secured exploration
        rights prior to establishment of proven and probable reserves. To date,
        the Company has not established the commercial feasibility of its exploration
        prospects, therefore, all costs are being expensed.                                                                         
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | b) | Use of Estimates
      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 for the reporting period. Actual results could differ from
        these estimates.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | c) | Foreign Currency Translation
      The Company's functional currency is the U.S. dollar. Transactions in
        foreign currency are translated into U.S. dollars as follows:                                                                                                                                                                                                                                                                                                                                         
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |    | i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |    | ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |    | iii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | d) | Income Taxes
      The Company has adopted Statement of Financial Accounting
        Standards No. 109  "Accounting for Income taxes" (SFAS 109). This
        standard requires the use of an asset and liability approach for financial
        accounting, and reporting on income taxes. If it is more likely than not
        that some portion or all of a deferred tax asset will not be realized,
        a valuation allowance is recognized.                                                                

F-8

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MERRITT VENTURES CORP.(An Exploration Stage Company)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2003 AND 2002(Stated in U.S. Dollars)

|2. | SIGNIFICANT ACCOUNTING POLICIES (Continued)
|-- | -------------------------------------------
|   |                                            

| | e) | Basic and Diluted Loss Per Share
      In accordance with SFAS No. 128  "Earnings Per
        Share", the basic loss per common share is computed by dividing net loss
        available to common stockholders by the weighted average number of common
        shares outstanding. Diluted loss per common share is computed similar
        to basic loss per common share except that the denominator is increased
        to include the number of additional common shares that would have been
        outstanding if the potential common shares had been issued and if the
        additional common shares were dilutive. At December 31, 2003, the Company
        has no stock equivalents that were anti-dilutive and excluded in the earnings
        per share computation.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

|3. | MINERAL PROPERTY OPTION AGREEMENT
      The Company had entered into an option agreement to acquire a 100% interest
        in four mineral claims located in British Columbia, Canada, for consideration
        consisting of staged cash payments totalling $2,000 (paid) and exploration
        expenditures totalling $15,000 by December 31, 2003. This option agreement
        was terminated during the year ended December 31, 2003.
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                
|4. | SUBSEQUENT EVENT
      On May 5, 2004, the Company entered into a mineral property
        option agreement to acquire a 75% interest in four mineral claims located
        in the Omenica Mining Division of British Columbia.
      In order to earn its interest, the Company is required
        to:                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | i)                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | ii)                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                

| |  | a) | $225,000 on or before December 31, 2004 to earn a 60%
        interest; and
| |  | -- | ---------------------------------------------------------------------------
| |  | b) | $100,000 on or before December 31, 2005 to earn an additional 15% interest.

F-9

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

None.

ITEM 8A.     CONTROLS AND PROCEDURES.

Evaluation Of Disclosure Controls And Procedures

As of the end of the period covered by this report, our management
  carried out an evaluation, under the supervision and with the participation
  of our Chief Executive Officer and Chief Financial Officer, of the effectiveness
  of the design and operation of our disclosure controls and procedures (as defined
  in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based on this evaluation,
  our Chief Executive Officer and Chief Financial Officer have concluded that
  our disclosure controls and procedures are, as of the date covered by this Annual
  Report, effective to ensure that the information required to be disclosed by
  us in the reports that we file or submit under the Exchange Act is recorded,
  processed, summarized and reported within the time periods specified in the
  SEC rules and forms.

Changes In Internal Controls Over Financial Reporting

In connection with the evaluation of our internal controls
  during our last fiscal quarter, our principal executive officer and principal
  financial officer have determined that there have been no changes to our internal
  controls over financial reporting that has materially affected, or is reasonably
  likely to materially effect, our internal controls over financial reporting.

ITEM 8B.     OTHER INFORMATION.

Proposed Business Acquisition

We are currently in discussions to acquire a Delaware company
  engaged in the business of selling and providing support services for telecommunications
  switching equipment in the United States, and an affiliated Canadian real estate
  holding company that owns a commercial office building located in Brockville,
  Ontario. If we are successful in completing the acquisition of the target companies,
  it is expected that we will abandon our mineral exploration business to focus
  on the businesses of the target companies.

If an agreement is reached with respect to the proposed acquisitions,
  it is expected that we will issue a substantial number of shares in our common
  stock and pay a substantial amount in cash for the shares of the target companies.
  As such, it is expected that we will require substantial financing in order
  to complete the proposed acquisition. As discussed under Item 5 of this Annual
  Report, in contemplation of the proposed acquisitions we have approved a private
  placement offering of 5,000,000 units at a price of $0.25 per unit for total
  potential proceeds of $1,250,000. However, there is no assurance that the proposed
  private placement will be completed or that we will be able to sell all of the
  units offered under the proposed private placement. Even if all units offered
  are sold under the proposed private placement, there is no assurance that these
  funds will be sufficient to allow us to complete the proposed acquisitions.

No agreement has been reached with respect to the proposed
  acquisitions and there is no assurance that we will be able to reach an agreement
  on the proposed acquisitions. Even if such an agreement is reached, there is
  no assurance that we will be able to obtain the necessary financing required
  to complete the acquisitions.

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Reports on Form 8-K.

The following Current Reports on Form 8-K have been filed
  by us since the end of our third quarter for our fiscal year ended December
  31, 2003:

|Date of Form 8-K | Date of Filing with the SEC | Description of the Form 8-K                                                                                                                                     
|---------------- | --------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------
|                 |                             |                                                                                                                                                                 
|May 5, 2004      | May 21, 2004                | Disclosure of Option Agreement with International Arimex Resources
      Inc. to acquire a 75% undivided interest in the Claw Property, dated May
      5, 2004.

PART III

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

The following table sets forth the names and positions of our officers and directors as of the date hereof:

|Name                 | Age | Positions                                                   
|-------------------- | --- | ------------------------------------------------------------
|Lorrie Ann Archibald | 35  | President, Chief Executive Officer and a Director           
|Gordon F. Burley     | 65  | Secretary, Treasurer, Chief Financial Officer and a Director

Lorrie Ann Archibald: Ms. Archibald is our President
  and Chief Executive Officer and is a member of our Board of Directors. Ms. Archibald
  was appointed to our Board of Directors and as our President and Chief Executive
  Officer on February 20, 2001.

Ms. Archibald served as a stockbrokers sales assistant
  at Continental Securities (which later became Yorkton Securities) from December
  of 1988 to September of 1992. From September of 1992 to February of 1999 Ms.
  Archibald was a registered representative with Canaccord Capital Corp. (Investment
  Dealers). During the period from January 1997 to October 1998 she was also licensed
  with First Securities, a member of the NASD. During the period from December
  1998 to her current employment with the Company, she was a self-employed investor.
  Since July of 2001 she has served as President and a Director of Nubio Ventures
  Inc., a non-reporting mineral exploration company that trades on the pink sheets.
  In June of 2001 she obtained a free miners license in the Province of
  British Columbia, Canada and since that date has been involved in the acquisition
  and disposition of mineral claims in British Columbia.

Gordon Fredrick Burley: Mr. Burley is our Secretary,
  Treasurer and Chief Financial Officer and is a member of our Board of Directors.
  Mr. Burley was appointed to our Board of Directors and as our Secretary, Treasurer
  and Chief Financial Officer on February 20, 2001.

Since November 1, 1996 Mr. Burley has served as a purchasing
  agent for LNS Services Ltd. LNS Services Ltd. is a design engineering construction
  company.

TERMS OF OFFICE

Our directors are appointed for a one-year term to hold office
  until the next annual general meeting of our shareholders or until removed from
  office in accordance with our bylaws. Our officers are appointed by our Board
  of Directors and hold office until removed by the Board.

SIGNIFICANT EMPLOYEES

We have no significant employees other than the officers and directors described above.

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COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT

Section 16(a) of the Exchange Act requires our executive officers
  and directors, and persons who beneficially own more than ten percent of our
  equity securities, to file reports of ownership and changes in ownership with
  the SEC. Officers, directors and greater than ten percent stockholders are required
  by SEC regulation to furnish us with copies of all Section 16(a) forms they
  file. Based on our review of the copies of such forms received by us, we believe
  that during the fiscal year ended December 31, 2003 all such filing requirements
  applicable to our officers, directors and greater than 10% stockholders were
  complied with.

AUDIT COMMITTEE

We are not a listed issuer and as such our board of directors
  is not required to maintain a separately-designated standing audit committee.
  As a result, our entire board of directors acts as our audit committee. Our
  board of directors has determined that we do not presently have a director who
  meets the definition of an audit committee financial expert. We
  believe that the cost related to appointing a financial expert to our board
  of directors at this time is prohibitive

CODE OF ETHICS

We adopted a Code of Ethics applicable to our officers and
  directors which is a "code of ethics" as defined by applicable rules of the
  SEC. Our Code of Ethics is attached as an exhibit to this Annual Report. If
  we make any amendments to our Code of Ethics other than technical, administrative,
  or other non-substantive amendments, or grant any waivers, including implicit
  waivers, from a provision of our Code of Ethics to our Chief Executive Officer,
  Chief Financial Officer, or certain other finance executives, we will disclose
  the nature of the amendment or waiver, its effective date and to whom it applies
  in a current report on Form 8-K filed with the SEC.

ITEM 10.     EXECUTIVE COMPENSATION.

COMPENSATION OF EXECUTIVE OFFICERS

Since our inception on February 20, 2001, no compensation
  has been awarded to, earned by or paid to our executive officers by us or any
  other persons.

STOCK OPTION GRANTS

Since our inception on February 20, 2001, we have not granted
  any stock options or stock appreciation rights to any of our executive officers.

LONG-TERM INCENTIVE PLANS

We do not have any long-term incentive plans, pension plans, or similar compensatory plans for our directors or executive officers.

COMPENSATION OF DIRECTORS

We have no arrangements for the compensation of any of our directors.

EMPLOYMENT CONTRACTS

We have no employment contracts, termination of employment
  or change-in-control arrangements with any of our executive officers or directors.

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

EQUITY COMPENSATION PLANS

We have no equity compensation plans (including individual
  compensation arrangements) under which our equity securities are authorized
  for issuance.

Equity Compensation Plan Information

|Plan Category                                                           | Number of Securities to
        be Issued Upon 
        Exercise of Outstanding
        Options, Warrants and
        Rights
      (a) | Weighted-Average
        Exercise Price of 
        Outstanding Options, 
        Warrants and Rights
      (b) | Number of Securities
        Remaining Available for
        Future Issuance Under
        Equity Compensation 
        Plans (Excluding 
        Securities Reflected in 
        column (a))
      (c)
|----------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Equity Compensation
      Plans Approved By Security 
      Holders     | Not Applicable                                                                                                                         | Not Applicable                                                                                                  | Not Applicable                                                                                                                                                                                          
|Equity Compensation Plans
      Not Approved By Security 
      Holders | Not Applicable                                                                                                                         | Not Applicable                                                                                                  | Not Applicable                                                                                                                                                                                          

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information concerning
  the number of shares of our common stock owned beneficially as of August 23,
  2004by: (i) each person (including any group) known to us to own more
  than five percent (5%) of any class of our voting securities, (ii) each of our
  directors and each of our named executive officers, and (iii) officers and directors
  as a group. Unless otherwise indicated, the shareholders listed possess sole
  voting and investment power with respect to the shares shown.

|Title of Class         | Name and Address
      of Beneficial Owner                                                | Number of Shares
      of Common Stock | Percentage of
      Common Stock(1)
|---------------------- | ----------------------------------------------------------------------------------------- | -------------------------------------- | -----------------------------------
|DIRECTORS AND OFFICERS
|Common Stock           | Lorrie Ann Archibald,
      Director, President and 
      Chief Executive Officer        | 2,500,000                              | 33.6%                              
|Common Stock           | Gordon F. Burley,
      Director, Secretary, Treasurer and 
      Chief Financial Officer | 2,500,000                              | 33.6%                              
|Common Stock           | All Officers and Directors as a Group
      (2 persons)                                   | 5,000,000                              | 67.2%                              
|5% SHAREHOLDERS       
|Common Stock           | None                                                                                      | Not Applicable                         | Not Applicable                     

18

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|(1) | Under Rule 13d-3, a beneficial owner of a security
        includes any person who, directly or indirectly, through any contract,
        arrangement, understanding, relationship, or otherwise has or shares:
        (i) voting power, which includes the power to vote, or to direct the voting
        of shares; and (ii) investment power, which includes the power to dispose
        or direct the disposition of shares. Certain shares may be deemed to be
        beneficially owned by more than one person (if, for example, persons share
        the power to vote or the power to dispose of the shares). In addition,
        shares are deemed to be beneficially owned by a person if the person has
        the right to acquire the shares (for example, upon exercise of an option)
        within 60 days of the date as of which the information is provided. In
        computing the percentage ownership of any person, the amount of shares
        outstanding is deemed to include the amount of shares beneficially owned
        by such person (and only such person) by reason of these acquisition rights.
        As a result, the percentage of outstanding shares of any person as shown
        in this table does not necessarily reflect the persons actual ownership
        or voting power with respect to the number of shares of common stock actually
        outstanding on August 23, 2004. As of August 23, 2004, there were 7,437,500
        shares of our common stock issued and outstanding.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

CHANGES IN CONTROL

We are not aware of any arrangement which may result in a change in control of the Company.

ITEM 12.     CERTAIN RELATIONSHIPS AND RELATED
  TRANSACTIONS.

None of the following persons has any direct or indirect material
  interest in any transaction to which we were or are a party during the past
  two years, or in any proposed transaction to which we propose to be a party:

|(1) | any director or officer;                                                                                                                                    
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                             
|(2) | any person who beneficially owns, directly or indirectly,
        shares carrying more than 5% of the voting rights attached to our common
        stock; or
|    |                                                                                                                                                             
|(3) | any immediate relative or spouse of any of the foregoing persons.                                                                                           

ITEM 13.     EXHIBITS.

EXHIBITS REQUIRED BY ITEM 601 OF REGULATION S-B

|Exhibit |  |                                                                                                                                                                            
|------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number  |  | Description of Exhibit                                                                                                                                                     
|        |  |                                                                                                                                                                            
|3.1     |  | Articles of Incorporation(1)                                                                                                                                               
|        |  |                                                                                                                                                                            
|3.2     |  | Bylaws(1)                                                                                                                                                                  
|        |  |                                                                                                                                                                            
|10.1    |  | Option Agreement between Michael H. Sanguinetti and
        the Company to acquire a 100% interest in the Zumar Property, dated April
        6, 2001(1)                   
|        |  |                                                                                                                                                                            
|10.2    |  | Amendment to Option Agreement between Michael H.
        Sanguinetti and the Company to acquire a 100% interest in the Zumar Property,
        dated December 28, 2001(1)  
|        |  |                                                                                                                                                                            
|10.3    |  | Amendment No. 2 to Option Agreement between Michael
        H. Sanguinetti and the Company to acquire a 100% interest in the Zumar
        Property, dated June 28, 2003(2)
|        |  |                                                                                                                                                                            
|10.4    |  | Option Agreement between International Arimex Resources
        Inc. and the Company to acquire a 75% undivided interest in the Claw Property,
        dated May 5, 2004(3)

19

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|Exhibit |  |                                                                                                                                                                      
|------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number  |  | Description of Exhibit                                                                                                                                               
|        |  |                                                                                                                                                                      
|10.5    |  | Amendment No. 1 to Option
        Agreement between International Arimex Resources Inc. and the Company,
        dated August 18, 2004(4)                            
|        |  |                                                                                                                                                                      
|14.1    |  | Code of Ethics(4)                                                                                                                                                    
|        |  |                                                                                                                                                                      
|31.1    |  | Certification of Chief Executive
      Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002(4)                                                          
|        |  |                                                                                                                                                                      
|31.2    |  | Certification of Chief Financial
      Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002(4)                                                          
|        |  |                                                                                                                                                                      
|32.1    |  | Certification of Chief
        Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant
        to Section 906 of the Sarbanes-Oxley Act of 2002 (4)
|        |  |                                                                                                                                                                      
|32.2    |  | Certification of Chief
        Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant
        to Section 906 of the Sarbanes-Oxley Act of 2002 (4)

| |     |                                                                                                                             
| | --- | ----------------------------------------------------------------------------------------------------------------------------
| | (1) | Previously filed as an Exhibit to our Form SB-2 registration
      statement originally filed on April 18, 2002, as amended.
| | (2) | Previously filed as an Exhibit to our Quarterly Report on
      Form 10-QSB filed on August 19, 2003.                       
| | (3) | Previously filed as an Exhibit to our Current Report on Form
      8-K filed on May 21, 2004.                               
| | (4) | Filed as an Exhibit to this Annual Report on Form 10-KSB.                                                                   
| |     |                                                                                                                             

ITEM 14.     PRINCIPAL ACCOUNTANT FEES AND SERVICES.

The aggregate fees billed for the two most recently completed
  fiscal years ended December 31, 2003 for professional services rendered by the
  principal accountant for the audit of the Corporations annual financial
  statements and review of the financial statements included our quarterly reports
  on Form 10-QSB and services that are normally provided by the accountant in
  connection with statutory and regulatory filings or engagements for these fiscal
  periods were as follows:

|                   | Year Ended December 31, 2003 | Year Ended December 31, 2002
|------------------ | ---------------------------- | ----------------------------
|Audit Related Fees | $2,500 CDN                   | $2,500 CDN                  
|Tax Fees           | $0                           | $0                          
|All Other Fees     | $1,500 CDN                   | $2,000 CDN                  
|Total              | $4,000 CDN                   | $4,500 CDN                  

20

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SIGNATURES

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

|                         | MERRITT VENTURES CORP.
|------------------------ | ----------------------
|                         |                       
|Date: September 24, 2004 | By:                   
|                         |                       
|                         |                       
|                         |                       



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