**UNITED STATES**

**Form 10-QSB**

XQUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934

For the quarterly period ended May 31, 2004

___ TRANSITION REPORT  UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934

For the transition period from ____ to ____

**SUNBURST ACQUISITIONS III, INC.**

|Colorado                                       | 0-23559                  | 84-14320001                         
|---------------------------------------------- | ------------------------ | ------------------------------------
|(State or other jurisdiction of
incorporation) | (Commission File Number) | (IRS Employer Identification
Number)

|4807 S. Zang WayMorrison, Colorado       | 80465     
|---------------------------------------- | ----------
|(Address of principal executive offices) | (Zip Code)

Issuer's telephone number:  (303) 979-2404

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities
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..

Applicable only to issuers involved in bankruptcy proceedings during the past five years.

Check whether the issuer has filed all documents and reports required to be filed by Section 12, 13 or
15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court.  Yes .X...
No .....

Applicable only to corporate issuers

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest
practicable date.  At May 31, 2004, 33,303,840 shares were outstanding.

Transitional Small Business Disclosure Format (Check one):  Yes .....     No ..X..



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ITEM 1.         FINANCIAL STATEMENTS AND EXHIBITS

(a)        
The unaudited financial statements of registrant for the nine months ended May 31, 2004,
follow.  The financial statements reflect all adjustments which are, in the opinion of management,
necessary to a fair statement of the results for the interim period presented.

**SUNBURST ACQUISITIONS III, INC.******

FINANCIAL STATEMENTS

May 31, 2004



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******SUNBURST ACQUISITIONS III, INC.**

|                                          | **ASSETS**                                                 |                                                     |      |                              
|----------------------------------------- | ---------------------------------------------------------- | --------------------------------------------------- | ---- | -----------------------------
|                                          |                                                            |                                                     |      |                              
|***CURRENT ASSETS*****                    |                                                            |                                                     |     
|                                          | Cash and cash equivalents                                  |                                                     |      | $                           6
|                                          | Note receivable (net of valuation allowance of $2,000,000) |                                                     | -   
|                                          |                                                            |                                                     |      |                              
|                                          |                                                            | ******Total current assets**                        | **** |                              
|                                          |                                                            |                                                     |      |                              
|                                          |                                                            | ****************TOTAL ASSETS                        | **** |                              
|                                          |                                                            |                                                     |      |                              
|                                          | **LIABILITIES AND STOCKHOLDERS' DEFICIT**                  |                                                     |      |                              
|                                          |                                                            |                                                     |      |                              
|***CURRENT LIABILITIES*****               |                                                            |                                                     |     
|                                          | Accounts payable                                           |                                                     |      | $                    3,152   
|                                          |                                                            |                                                     |      |                              
|                                          |                                                            | ******Total current liabilities**                   | **** |                              
|                                          |                                                            |                                                     |      |                              
|***************STOCKHOLDERS' DEFICIT***** |                                                            |                                                     |     
|                                          | Preferred stock, no par value; 20,000,000 shares           |                                                     |      |                              
|                                          |                                                            | authorized; No shares issued and outstanding        |      |                              
|                                          | Common stock, no par value; 100,000,000                    |                                                     |      |                              
|                                          |                                                            | shares authorized; 33,303,840 shares issued and     |      |                              
|                                          |                                                            | outstanding                                         |      |                              
|                                          | Additional paid-in capital                                 |                                                     |      | 52,723                       
|                                          | Common stock subscribed                                    |                                                     |      | -                            
|                                          | Deficit accumulated during the development stage           |                                                     |      | (2,076,304)                  
|                                          |                                                            |                                                     |      |                              
|                                          |                                                            | **Total stockholders' deficit**                     | **** |                              
|                                          |                                                            |                                                     |      |                              
|                                          |                                                            | ******TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT** |      | $                           6

The accompanying notes are an integral part of the financial statements.

F-1



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**SUNBURST ACQUISITIONS III, INC.**

|                                  |                                |                          |                          | **Period**                      | ****                      |                          |                          |                         |                         |                  |       |             
|--------------------------------- | ------------------------------ | ------------------------ | ------------------------ | ------------------------------- | ------------------------- | ------------------------ | ------------------------ | ----------------------- | ----------------------- | ---------------- | ----- | ------------
|                                  |                                |                          |                          | ****************August 27, 1997 | ****                      | **For the three months** | ****                     | **For the nine months**
|****                              |                                |                          |                          | **(inception) to**              | ****                      | **ended May 31,**        | ****                     | **ended May 31,**      
|****                              |                                |                          |                          | **May 31, 2004**                | ****                      | **2004**                 | ****                     | **2003**                | ****                    | **2004**         | ****  | **2003******
|****                              |                                |                          |                          |                                 |                           |                          |                          |                         |                         |                  |       |             
|****REVENUES                      | $                            - |                          | $                      - |                                 | $                       - |                          | $                      - |                         | $                     -
|                                  |                                |                          |                          |                                 |                           |                          |                          |                         |                         |                  |       |             
|EXPENSES                          |                                |                          |                          |                                 |                           |                          |                          |                         |                        
|                                  | Amortization                   | 300                      |                          | -                               |                           | -                        |                          | -                       |                         | -               
|                                  | Consulting fees                | 4,935                    |                          | -                               |                           | -                        |                          | -                       |                         | -               
|                                  | General office                 | 2,205                    |                          | 12                              |                           | -                        |                          | 27                      |                         | -               
|                                  | Legal fees                     | 31,000                   |                          | -                               |                           | -                        |                          | -                       |                         | -               
|                                  | Professional fees              | 25,769                   |                          | 6,011                           |                           | -                        |                          | 6,011                   |                         | -               
|                                  | Rent                           |                          | 4,050                    |                                 | 150                       |                          | 150                      |                         | 450                     |                  | 450  
|                                  | Taxes and licenses             | 132                      |                          | -                               |                           | -                        |                          | -                       |                         | -               
|                                  | Transfer agent                 | 7,913                    |                          | -                               |                           | 297                      |                          | (378)                   |                         | 1,566           
|                                  | Valuation allowance            | 2,000,000                |                          | -                               |                           | -                        |                          | -                       |                         | -               
|                                  |                                |                          |                          |                                 |                           |                          |                          |                         |                         |                  |       |             
|                                  |                                | Total expenses           | 2,076,304                |                                 | 6,173                     |                          | 447                      |                         | 6,110                   |                  | 2,016
|                                  |                                |                          |                          |                                 |                           |                          |                          |                         |                         |                  |       |             
|NET LOSS                          | (2,076,304)                    |                          | (6,173)                  |                                 | (447)                     |                          | (6,110)                  |                         | (2,016)                
|                                  |                                |                          |                          |                                 |                           |                          |                          |                         |                         |                  |       |             
|Accumulated deficit               |                                |                          |                          |                                 |                           |                          |                          |                         |                        
|                                  |                                |                          |                          |                                 |                           |                          |                          |                         |                         |                  |       |             
|                                  | Balance, beginning of period   | -                        |                          | (2,070,131)                     |                           | (2,069,285)              |                          | (2,070,194)             |                         | (2,067,716)     
|                                  |                                |                          |                          |                                 |                           |                          |                          |                         |                         |                  |       |             
|                                  | Balance, end of period         | $            (2,076,304) |                          | $      (2,076,304)              |                           | $       (2,069,732)      |                          | $      (2,076,304)      |                         | $    (2,069,732)
|                                  |                                |                          |                          |                                 |                           |                          |                          |                         |                         |                  |       |             
|NET LOSS PER SHARE                | $                     (0.06)   |                          | $              (NIL)     |                                 | $              (NIL)      |                          | $              (NIL)     |                         | $             (NIL)    
|                                  |                                |                          |                          |                                 |                           |                          |                          |                         |                         |                  |       |             
|WEIGHTED AVERAGE NUMBER OF SHARES |                                |                          |                          |                                 |                           |                          |                          |                         |                        
|OF COMMON STOCK AND COMMON        |                                |                          |                          |                                 |                           |                          |                          |                         |                        
|STOCK EQUIVALENTS OUTSTANDING     | 34,157,404                     |                          | 33,303,840               |                                 | 33,303,840                |                          | 33,303,840               |                         | 33,303,840             

The accompanying notes are an integral part of the financial statements.

F-2



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**SUNBURST ACQUISITIONS III, INC.**

|                                          |                                |                                  |                                          | Period                          | ****              |                         |       |         
|----------------------------------------- | ------------------------------ | -------------------------------- | ---------------------------------------- | ------------------------------- | ----------------- | ----------------------- | ----- | --------
|                                          |                                |                                  |                                          | ****************August 27, 1997 | ****              |                         |       |         
|                                          |                                |                                  |                                          | ****************(inception)     | ****              | **For the nine months**
|****                                      |                                |                                  |                                          | **to May 31,**                  | ****              | **ended May 31,**      
|****                                      |                                |                                  |                                          | **2004**                        | ****              | **2004**                | ****  | **2003**
|****                                      |                                |                                  |                                          |                                 |                   |                         |       |         
|**** CASH FLOWS FROM OPERATING ACTIVITIES |                                |                                  |                                          |                                 |                  
|Net loss                                  | $           (2,076,304)        |                                  | $      (6,110)                           |                                 | $         (2,016)
|Adjustments to reconcile                  |                                |                                  |                                          |                                 |                  
|                                          | net loss to net cash flows     |                                  |                                          |                                 |                   |                        
|                                          | from operating activities:     |                                  |                                          |                                 |                   |                        
|                                          |                                | Amortization                     | 300                                      |                                 | -                 |                         | -    
|                                          |                                | Rent expense                     | 2,400                                    |                                 | -                 |                         | -    
|                                          |                                | Stock issued for consulting fees | 4,935                                    |                                 | -                 |                         | -    
|                                          |                                | Change in accounts payable       | 3,152                                    |                                 | 1,274             |                         | 1,566
|                                          |                                |                                  |                                          |                                 |                   |                         |       |         
|                                          |                                |                                  | Net cash flows from operating activities | (2,065,517)                     |                   | (4,836)                 |       | (450)   
|                                          |                                |                                  |                                          |                                 |                   |                         |       |         
|CASH FLOWS FROM INVESTING ACTIVITIES      |                                |                                  |                                          |                                 |                  
|                                          | Increase in organization costs | (300)                            |                                          | -                               |                   | -                      
|                                          |                                |                                  |                                          |                                 |                   |                         |       |         
|                                          |                                |                                  | Net cash flows from investing activities | (300)                           |                   | -                       |       | -       
|                                          |                                |                                  |                                          |                                 |                   |                         |       |         
|CASH FLOWS FROM FINANCING ACTIVITIES      |                                |                                  |                                          |                                 |                  
|                                          | ****Issuance of common stock   | 2,007,500                        |                                          | -                               |                   | -                      
|                                          | Issuance of preferred stock    | 8,000                            |                                          | -                               |                   | -                      
|                                          | Additional paid-in capital     | 50,323                           |                                          | 4,834                           |                   | 450                    
|                                          |                                |                                  |                                          |                                 |                   |                         |       |         
|                                          |                                |                                  | Net cash flows from financing activities | 2,065,823                       |                   | 4,834                   |       | 450     
|                                          |                                |                                  |                                          |                                 |                   |                         |       |         
|NET DECREASE IN CASH                      |                                |                                  |                                          |                                 |                  
|                                          | ****AND CASH EQUIVALENTS       | 6                                |                                          | (2)                             |                   | -                      
|                                          |                                |                                  |                                          |                                 |                   |                         |       |         
|********CASH AND CASH EQUIVALENTS,        |                                |                                  |                                          |                                 |                  
|                                          | **BEGINNING OF PERIOD**        | -                                |                                          | 8                               |                   | 8                      
|                                          |                                |                                  |                                          |                                 |                   |                         |       |         
|******** CASH AND CASH EQUIVALENTS,       |                                |                                  |                                          |                                 |                  
|                                          | **END OF PERIOD**              | $                          6     |                                          | $                   6           |                   | $                  8   

The accompanying notes are an integral part of the financial statements.

F-3



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**SUNBURST ACQUISITIONS III, INC.**

**1.        
Management's Representation of Interim Financial Information**

****The accompanying financial statements have been prepared by Sunburst Acquisitions III, Inc. without
audit pursuant to the rules and regulations of the Securities and Exchange Commission.  Certain
information and footnote disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed or omitted as allowed by such rules
and regulations, and management believes that the disclosures are adequate to make the information
presented not misleading.  These financial statements include all of the adjustments which, in the opinion
of management, are necessary to a fair presentation of financial position and results of operations.  All
such adjustments are of a normal and recurring nature.  These financial statements should be read in
conjunction with the audited financial statements at August 31, 2003.****

F-4



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

**SPECIAL NOTE OF CAUTION REGARDING FORWARD-LOOKING STATEMENTS**

Certain statements in this report, including statements in the following discussion, which are not
statements of historical fact, are what are known as "forward-looking statements," which are basically
statements about the future.  For that reason, these statements involve risk and uncertainty since no one
can accurately predict the future.  Words such as "plans," "intends," "will," "hopes," "seeks,"
"anticipates," "expects," and the like, often identify such forward-looking statements, but are not the only
indication that a statement is a forward-looking statement.  Such forward-looking statements include
statements concerning our plans and objectives with respect to the present and future operations of the
Company, and statements which express or imply that such present and future operations will or may
produce revenues, income or profits.  Numerous factors and future events could cause the Company to
change such plans and objectives, or fail to successfully implement such plans or achieve such
objectives, or cause such present and future operations to fail to produce revenues, income or profits.

Therefore, the  reader is advised that the following discussion should be considered in light of
the discussion of risks and other factors contained in this report on Form 10QSB and in the Company's
other filings with the Securities and Exchange Commission.  No statements contained in the following
discussion should be construed as a guarantee or assurance of future performance or future results.

Liquidity and Capital Resources

As of May 31, 2004,  the Company remains in the development stage.  For the period ended May
31, 2004, the Company's balance sheet reflects current and total assets of $ 6, and current liabilities of
$3,152.

Results of Operations

During the period from August 27, 1997 (inception) through May 31, 2004, the Company has
accumulated a deficit of $2,076,304.  This deficit is primarily the result of a $2,000,000 valuation
allowance taken against a promissory note from American Recruitment Conferences, Inc., a California
corporation ("ARC") and Workseek.com, Inc., a California corporation ("Workseek").  The promissory
note was issued to the Company to evidence a loan made in conjunction with execution of an Agreement
and Plan of Reorganizaton with ARC and Workseek, dated August 30, 1999.  The proposed transaction
was not consummated and recovery of the amount due under the promissory note was doubtful.  As a
result, as of August 31, 2000, the promissory note receivable was offset by a full allowance for
realization.

During the period from inception to May 31, 2004, the Company has engaged in no significant
operations other than organizational activities, acquisition of capital, preparation and filing of the
registration of its securities under the Securities Exchange Act of 1934, as amended, compliance with its
periodical reporting requirements, and efforts to locate a suitable merger or acquisition candidate. No
revenues were received by the Company during this period.

From the date of filing of its registration statement under the Securities Exchange Act of 1934
(December 29, 1997) until the end of the fourth quarter of its 2001 fiscal year, the Company filed all
required periodic reports under the Securities Exchange Act of 1934. After completing the filing of the
report on Form 10KSB for the fiscal year ended August 31, 2001, the Company ceased filing reports in
order to avoid incurring additional legal and accounting expenses.

After the 2001 fiscal year, the Company remained dormant throughout the fiscal years ending
August 31, 2002 and August 31, 2003.  The Company incurred no expenses for legal and accounting fees
in 2002 and 2003, and it also ceased all efforts related to seeking a suitable merger or acquisition
candidate during the period it remained dormant.

Plan of Operations and Need for Additional Financing

The Company's plan of operations since August 31, 2001 was to remain dormant in order to
avoid incurring legal and accounting fees related to compliance with its reporting obligations. However,
in February 2004 there was a change of control, and the Company elected to begin taking the steps
necessary to file all delinquent reports and to once again become current in compliance with its reporting
obligations under the Securities Exchange Act of 1934. As of the date of filing of this report on Form
10QSB for the period ended May 31, 2004, the Company has completed the filing of all delinquent
periodic reports and is current with its periodic  reporting obligations under the Securities Exchange Act
of 1934.

For the fiscal year ending August 31, 2004, the Company's plan of operations is to remain current
in compliance with its reporting obligations under the Securities Exchange Act of 1934 and to engage in
efforts to locate a suitable merger or acquisition candidate. The Company will require additional capital
in order to pay the costs associated with making required filings and seeking out suitable merger or
acquisition candidates.

No specific commitments to provide additional funds have been made by management or other
stockholders, and the Company has no current plans, proposals, arrangements or understandings with
respect to the sale or issuance of additional securities prior to the location of a merger or acquisition
candidate. Accordingly, there can be no assurance that any additional funds will be available to the
Company to allow it to cover its expenses. Notwithstanding the foregoing, to the extent that additional
funds are required, the Company anticipates receiving such funds in the form of advancements from
current shareholders without issuance of additional shares or other securities, or through the private
placement of restricted securities rather than through a public offering.

The Company may also seek to compensate providers of services by issuances of stock in lieu of
cash. For information as to the Company's policy in regard to payment for consulting services, see
"Certain Relationships and Transactions."

**ITEM 3.        CONTROLS AND PROCEDURES**

As of the end of the period covered by this report, we 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.  Based on this
evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls
and procedures are effective in timely alerting them to material information required to be included in
our periodic SEC reports.  It should be noted that design of any system of controls is based in part upon
certain assumptions about the likelihood of future events, and there can be no assurance that any design
will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.

In addition, there has been no change in our internal control over financial reporting during the
most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our
internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1.        LEGAL PROCEEDINGS

None.

ITEM 2.        CHANGES IN SECURITIES AND USE OF PROCEEDS

None.

ITEM 3.        DEFAULTS UPON SENIOR SECURITIES

None.

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

None.

ITEM 5.        OTHER INFORMATION

None

ITEM 6.        
EXHIBITS AND REPORTS ON FORM 8-K.

> (a)        The following exhibits are filed herewith:
> 
> 
> 31.1        
> Certifications pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act
> of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of
> 2002.
> 
> 
> 32.1        
> Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
> the Sarbanes-Oxley Act of 2002.
> 
> 
> (b)        
> Two reports on Form 8-K were filed by the Company during the quarter ended May 31,
> 2004:

> (i)        A report on Form 8-K dated February 17, 2004 was filed on March 8, 2004, to
> report a change in control of the registrant.
> 
> (ii)        A report on Form 8-K dated March 5, 2004 was filed on March 9, 2004, to report
> a change in the registrant's certifying accountant.



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SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.

**SUNBURST ACQUISITIONS III, INC.**

By: /S/ JAY LUTSKYJay Lutsky  (Principal Executive Officer and Director)

By: /S/ MICHAEL R. QUINNMichael R. Quinn  (Principal Financial Officer and Director)

Date: July 9, 2004