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

                                   FORM 10-KSB



            [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                 SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]

                     For the fiscal year ended June 30, 2002

                                       OR

          [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]

         For the transition period from ______________ to _____________

                         Commission file number: 0-49624

                  NATIONAL HEALTHCARE FINANCIAL SERVICES, INC.
            (Name of small business issuer specified in its charter)

                               Florida 65-1099348
                  (State or other jurisdiction (I.R.S. Employer
              of incorporation or organization) Identification No.)


           2754 West Atlantic Blvd., Suite 4, Pompano Beach, FL 33069
          (Address of principal executive offices, including zip code)

                                  954-343-4970
                (Issuer's telephone number, including area code)


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

                              Name of each exchange
                     Title of each class on which registered
                                    None None

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

                    Common Stock, $0.001 par value per share

<PAGE>

Check whether the issuer:  (i) 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 (ii) has been
subject to such filing requirements for the past 90 days. Yes X No ____

Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulation  S-B is not  contained  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]

The issuer's revenues for the fiscal year ended June 30, 2002 were $0.

The number of shares  outstanding of the issuer's  common stock as of October 5,
2002 was 55,890 shares.

The  market  value  of  the  voting  and   non-voting   common  equity  held  by
non-affiliates computed on the basis of the price at which such shares were sold
was $31,433 on October 5, 2002.

                       DOCUMENTS INCORPORATED BY REFERENCE

                                      None

Transitional Small Business Disclosure Format :  .  Yes ____  No   X


                                      1
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ITEM 1. DESCRIPTION OF  BUSINESS

GENERAL

OVERVIEW

     Our business plan is to purchase healthcare  provider accounts  receivables
at a discount  to the face  amount of the  receivable.  We will then  attempt to
collect 100% of the account balance. The receivables generally will be purchased
from  healthcare  providers and other similar  businesses,  which we refer to in
this  prospectus as our "sellers" or  "providers."  We will rely on our officers
and employees to provide the services required for the purchase,  monitoring and
administration of the receivables, like marketing,  servicing,  underwriting and
acquisition services.

     Our  receivable  purchases will generally be limited to those having payors
like:

         *    Medicare;

         *    Medicaid;

         *    other governmental agencies like Civilian Health and Medical
              Program of the Uniform Services ("CHAMPUS");

         *    commercial insurance companies;

         *    casualty insurers; and

         *    managed care providers, preferred provider organizations and
               self-insured companies.

     We  will  only  purchase  the  insured  portion  of an  account  receivable
generated from patient services  rendered by healthcare  providers that meet the
financial  requirements  and  underwriting  standards that we will establish and
which will be designed to limit any losses on the purchase of receivables.  This
will include  limitations  on the amount of  receivables  purchased from any one
provider.

     We will  establish  credit  criteria which is similar to that used by other
similar lending institutions. We will review the relevant operating,  historical
and financial data of prospective providers are reviewed to assess the financial
risk involved in purchasing that prospective  providers healthcare  receivables.
The insured portion represents an obligation of third-party insurance companies,
large  corporations,  state or federal government  agencies,  preferred provider
organizations  or health  maintenance  organizations.  We will not  purchase any
portion of receivables  that are "self-pay."  Self-pay relates to the portion of
the receivable to be paid by an individual patient.

INDUSTRY BACKGROUND

     While the healthcare  industry  remains a major factor in the United States
economy,  we believe that recent changes in the economics of healthcare delivery
have  increased the demand for  financing  services of the type to be offered by
our company. Due to the pressure from health insurance  companies,  corporations
and  government  agencies to control  health care costs,  a trend toward managed
care has  emerged.  We  believe  the shift to  managed  care,  coupled  with the
increasingly  complicated  reimbursement  procedures  implemented  by  payors of
healthcare  receivables,  has made billing  collection  more  difficult and time
consuming, with collection time for healthcare receivables running 60 to 90 days
or more,  which presents  financial  problems for many providers.  Consequently,
healthcare  providers  experience a  substantially  increased need for immediate
cash flow to support not only daily  operational  expenses,  but the  additional
billing  and  collection  services  expense.  In  order  to  improve  collection
efficiency,  healthcare  providers are forced to either  out-source  billing and
collection or hire a number of highly skilled  employees solely for these tasks.
Despite these  efforts,  many  providers  often incur a significant  loss due to
their inability to effectively  process large amounts of claim  information in a
timely manner. With payor reimbursement arrangements requiring increasingly more
complex and lengthy  procedures,  the providers' revenue collection  departments
have  become  less  able to  timely  process  the  claims  due to their  limited
capacity.  Improperly or incompletely  submitted  information results in payment
delays.

                                       2
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     Consequently,  we believe a serious administrative and cash flow management
problem  exists for many  healthcare  providers.  They are faced  with  numerous
expenses  ranging from  equipment  and facility  costs to payroll and  liability
insurance fees. In the new managed care  environment,  healthcare  providers are
forced  to  become  more  efficient   business  operators  in  order  to  remain
profitable. The consequences of a provider's inability or unwillingness to adapt
to these changes by using more sophisticated revenue collection systems causes a
shift in financial risk for providing healthcare from the payor to the provider.

     We believe these  providers  have an increased  need for  predictable  cash
flow.

     Businesses   generally  utilize  working  capital  or  accounts  receivable
financing to bridge the shortfall between the turnover of current assets and the
maturity of current liabilities. A business will often experience this shortfall
during periods of revenue growth because cash flow from new revenues lags behind
cash outlays  required to produce new  revenues.  For example,  a growing  labor
intensive  business will often need to fund payroll  obligations before payments
are received on new services provided or products produced. We believe that many
healthcare  providers have rapidly expanding  businesses,  and therefore require
accounts receivable financing to fund their growth.

     As a  result  of  these  developments,  we  believe  financing  or  sale of
healthcare  receivables  has become a more  efficient  solution to meet the cash
flow needs of today's healthcare providers.

OUR BUSINESS STRATEGY

     Banks, commercial finance companies,  factors and various smaller financing
companies  provide  financing  through the purchase of  receivables.  We believe
these lenders  typically have been less willing to provide  financing to smaller
healthcare  providers  of the types we  intend  to serve and that a  substantial
market demand exists for our proposed services.


     TARGET  PROVIDERS.  We intend to offer  financing  to  medium  and  smaller
hospitals, other healthcare providers and durable medical equipment distributors
that  generally  do not produce  receivables  at a high enough  level to attract
large financial institutions,  by purchasing their receivables. We believe there
is less  competition  for the financing  business of these  smaller  providers.
Initially,  our  primary  marketing  strategy  will  focus  on the  purchase  of
receivables from:


     *    physician groups consisting of two to six doctors;

     *    home healthcare facilities;

     *    durable medical equipment distributors;

     *    medical staffing companies;

     *    radiology and diagnostic medical facilities;

     *    medical testing facilities; and

     *    other healthcare businesses and related businesses which we determine
          through the underwriting process to have low risk.

                                       3
<PAGE>

     We intend to target those  providers  with  billings of $20,000 to $200,000
per month. We believe  fee-for-service  practitioners  are a good type of client
due to the  relatively  small  nature of their  business and the manner in which
they are paid.  Fee-for-service  practitioners are  practitioners  that bill for
healthcare services using a retail billing rate for the services provided.  They
are  then  paid by the  insurance  companies  based  on  medical  fee  schedules
established by the insurance industry.  These healthcare  practitioners  usually
have two to six  practitioners  in one  office.  We  believe  their  billing  is
relatively easy to monitor and purchase,  and believe their payment pattern will
be best suited for our business.  The other healthcare  businesses with which we
intend to deal are primarily small hospitals,  skilled nursing facilities,  home
health agencies and medical clinics.

     TARGET  GEOGRAPHICAL  AREAS. We intend to initially target  fee-for-service
practitioners  and other healthcare  businesses in the South Florida counties of
Palm Beach,  Broward,  Miami-Dade and Monroe. These counties include cities like
West Palm Beach, Fort Lauderdale and Miami as well as suburban areas.

     OBTAINING  PROVIDERS.  We generally  will have four  potential  sources for
developing and locating the healthcare  provider base from which we will acquire
receivables:

         *   referrals from banks and other financial institutions,
         *   referrals from independent financing brokers and insurance agents,
         *   advertising and public relations, and
         *   sales and marketing personnel.


     Banks are  continually  approached  by  medical  groups for  financing.  In
addition,  trust  departments,  brokerage  firms  and  investment  advisers  are
regularly  asked by their provider  clients where  financing  might be obtained.
Banks  and  institutions  may refer  providers  to us in those  cases  where the
institution is unwilling or unable to provide  financing for its client.  Such a
referral will provide the institution with the continued  goodwill of its client
since the institution will be providing assistance to the client by the referral
even if it will not finance the client directly.  There can be no assurance that
we will receive any such referrals.


     We believe a rapidly growing  community of independent  brokers exists that
arranges  financing  specific to the  healthcare  industry.  These brokers refer
providers to different  lending  institutions for a fee. These brokers assist in
locating  receivables   available  for  purchase  from  smaller  providers  that
typically cannot find traditional financing because of their small size.

     Independent  loan brokers act as middle men between  potential  sellers and
potential purchasers of healthcare  receivables.  They do not generally purchase
receivables for their own account.  Such brokers generally receive  compensation
of 10% of profits realized from their  activities.  The services of such brokers
provides  valuable  marketing  to a new  company  such  as  National  Healthcare
Financial Services,  Inc. in entering the healthcare receivables finance market.
Since our marketing  activities in the initial stages will be limited due to our
limited  amount of working  capital,  we believe  that working with loan brokers
will enable us to reach more potential customers than we could reach directly.

                                       4
<PAGE>

RECEIVABLES ACQUISITION PROCESS

     When we identify a healthcare  provider or other seller who we may purchase
receivables  from, we will generally  seek to enter into a receivables  purchase
agreement  with that  provider.  This  agreement will give us the right of first
refusal to purchase all receivables  from that seller either weekly,  bi-weekly,
semi-monthly  or monthly,  generally for a period of one year.  The terms of the
agreement will not require us to purchase any  particular  amount of receivables
from any provider.

     APPROVAL  OF  PROVIDERS  AND OTHER  SELLERS.  Generally,  we will  purchase
healthcare and other  receivables  directly from the seller after the seller and
the  receivables  have a set of criteria for the  selection  of the  prospective
sellers and guidelines for the receivables that will qualify for purchase.

     UNDERWRITING  POLICIES. In order to avoid purchasing healthcare receivables
which may be difficult or impossible to collect due to problems such as improper
activities  by  healthcare  providers  and  delivery of services  not covered by
patients'  insurance,  we will  undertake due  diligence and establish  criteria
which will govern the  acceptable  of healthcare  providers for our  receivables
financing  services.  Such  criteria  will  include,  but not be  limited to the
following:

*        credit report and financial statements of the healthcare provider
*        search for liens filed under the Uniform Commercial Code
*        review of legal status of the provider with the Secretary of State
*        conduct on-site visual inspection of medical and billing facilities
*        review tax returns of providers
*        review billing procedures and collection efforts
*        phone verification of insurance coverage for services rendered by the
         medical provider
*        review receivable aging reports
*        review copies of contracts with payors such as health maintenance
         organization
*        review good standing of providers with Medicare and Medicaid and
         insurers
*        credit report for and financial statements individual guarantors
*        criminal background check for individuals involved in management of
         providers

     The purpose of the foregoing is to determine that the healthcare  providers
from which we purchase receivables:

*    are in good standing with payors such as health maintenance  organizations,
     private insurers and government payors;
*    that the provider has a reasonable credit history
*    that the provider has a satisfactory record of collecting its receivables
*    that the management of the provider has no unacceptable credit or criminal
     matters
*    that the provider has the ability to pay its obligations

     To the extent that the underwriting criteria that we establish do not allow
us to avoid of purchase of  receivables  which are objected to by the payor,  we
may experience losses in our healthcare finance receivable business.

                                       5
<PAGE>

     Since we have not yet begun  operating our  healthcare  receivable  finance
investors  will not be able to judge the adequacy of the  underwriting  criteria
which we will establish.

     CREDIT RISK  MANAGEMENT.  The possible  insolvency or loss of funding of an
individual  third-party payor is a significant risk to our business. In order to
minimize this risk,  we will impose  restrictions  on the amount of  receivables
that can be  purchased  from  any  individual  third-party  payor,  within  each
provider and within the total loan portfolio. We will constantly review industry
rating  agency  reports and industry  journals and articles in order to gain any
foreknowledge of possible financial problems of any third-party payors.

     A credit report will be obtained from an appropriate  credit agency on each
prospective  provider  and its  principals  and any medical  personnel  with any
ownership interest.  The provider must be creditworthy,  and any negative credit
comments  must be explained  and  documented  to our  satisfaction.  Prospective
providers  will be  required  to  provide  favorable  bank  references.  A UCC-1
Financing  Statement  search will be performed  to  determine  that there are no
present  liens  against the  receivables  of the  prospective  provider.  If any
receivable liens do exist, the lien must be paid off before,  or as part of, the
initial purchasing or funding of any receivables.

     PURCHASE  OF  RECEIVABLES.  Our  purchase  agreement  with a provider  will
require  that we have  the  first  right  of  refusal  on all of the  provider's
receivables on a regular-interval basis, generally for one year.

     RECEIVABLES  CHARACTERISTICS.  In some cases,  we may purchase  receivables
that are more than 90 days old, depending on the analysis of the receivable. The
age for any  receivable  is the number of days elapsed since its billing date to
the  payor of the  receivable.  We will buy  receivables  with the goal that the
average age of receivables in our portfolio  generally will not exceed 180 days.
We will have the sole  discretion as to which  receivables we will purchase.  We
will  reserve  the right to  disqualify  some  categories,  or some  payors,  of
receivables for purchase at our discretion.

     When acquiring  receivables,  we will only purchase receivables that are to
be paid by:

     *    an insurance carrier;
     *    an approved HMO;
     *    an approved government agency;
     *    an approved institutional facility;
     *    a self-insured employer; or
     *    an other entity which meets our financial standards.

     Except for government agencies,  we will limit the portion of our portfolio
of  receivables  that are payable by a single  payor to 15%. We also will ensure
that at any  given  time no more than 50% of our  total  outstanding  investment
portfolio of receivables,  in the aggregate,  will be from Medicare and Medicaid
payors. Because Medicare and Medicaid claims are submitted  electronically,  the
turnaround  time for  payment  is about 30 days.  It is for this  reason we will
accept higher  amounts of these  receivables  than from  traditional  commercial
insurance carriers.

                                       6
<PAGE>

     PRICING  RECEIVABLES  FOR PURCHASE.  Once a seller has met the criteria and
agreed to the  requirements,  we will begin the process of selecting and pricing
the receivables for purchase. One of the most important aspects of the selection
process,  and the due diligence  procedure  performed on prospective  providers,
involves an analysis of a  provider's  historical  receivables  and  collections
records  to  evaluate  the  receivables  likely  to be  paid  within  a  defined
collection period.

     Our purchase price paid for healthcare and other  receivables will be based
on a percentage of the face value of the  receivable.  To determine the purchase
price,  the face  value  will be  reduced  first by the  amount  of any  patient
co-payment and any amounts in excess of what the payor has historically paid for
the procedure  giving rise to the receivable.  The resulting amount will then be
further reduced by considering  other factors that influence the amount which is
likely to be collected under the receivable, including the historical collection
experience  of the  provider,  amount of  reserves  held for that  provider  and
overall  experience is purchasing and collection of receivables from a provider.
The resulting  number will be the estimate of the net  collectible  value of the
receivable, or the estimated net receivable.

     RESERVE  ACCOUNT.  We will purchase the receivables at a price equal to the
estimated net receivable.  Only a portion of the purchase  price,  not exceeding
90% of the estimated net receivable,  will be paid to the seller immediately.  A
portion  of the  purchase  price not  immediately  paid will be  allocated  to a
reserve  account for that  provider.  We will retain the remainder of the unpaid
purchase price as our fee.

     The  purpose  for  establishing  a reserve  account  is to have  protection
against  losses due to  uncollected  receivables.  Withholding  a portion of the
purchase price is easier to exercise than  attempting to require the replacement
of an uncollected receivable or otherwise seeking enforcement of the receivables
purchase agreement.  If a purchased  receivable becomes outstanding for over 180
days, we may, at our option:

     *   offset the amount actually paid to the seller for the receivable
          against the seller's reserve account;
     *   offset the amounts due to the seller from the purchase of other
          batches of receivables;
     *   require the seller to replace the uncollected receivables with
          additional receivables; or
     *   exercise our rights under a guarantee from the seller, if any.

     If a receivable is collected at a later date,  the reserve  account will be
credited by the amount of the  collection  up to the amount that was  previously
offset.  Any time the amount collected with respect to a receivable is less than
the amount invoiced,  the difference will be offset against the reserve account.
If the receivables purchase agreement is terminated,  any remaining balance in a
seller's reserve account will be returned to the seller after the payment of any
advances made by us, and any interest and fees due have been paid.

     The amount of the reserve  account will generally  range from 10% to 25% of
the  estimated  net  receivable.  A seller is paid the amount  allocated  to its
reserve  account only when the amount exceeds a negotiated  percentage,  usually
25%, of all of the receivables purchased from the seller that are outstanding at
any one time. From time to time a reserve accounting will be made to the seller.
When  warranted by this  accounting,  any excess in the reserve  account will be
paid to the seller within 15 days of the accounting.  Any amount paid on a batch
of  receivables  in excess of the  estimated  net  receivable  is allocated as a
credit to the seller's reserve account.

                                       7

<PAGE>

     An adjustment  may be made if the seller's  reserve  account  balance falls
below 5% of the outstanding uncollected receivables balance for that seller. The
adjustment is typically  made to the estimated net receivable  percentage.  This
adjustment  effectively  reduces the percentage of cash  immediately paid to the
provider when future  receivables are purchased.  For example, a provider may be
initially paid 85% of the estimated net receivable immediately when a receivable
is purchased from that provider.  If that seller's reserve account balance falls
below 5% of the outstanding receivables balance and requires an adjustment,  the
provider may only be paid 80% of the  estimated  net  receivable  at the time of
purchase for future receivable  purchases.  In this example,  in addition to the
normal allocation to the reserve account,  an additional 5% of the estimated net
receivable  would be allocated to the reserve account for all future  purchases.
This  adjustment,  in effect,  increases  the amount  allocated  to the  reserve
account on each future purchase.

     LOCK  BOX  &  COLLECTIONS.  As  required  under  the  receivables  purchase
agreements  we  intend to  utilize,  all  proceeds  from the  collection  of the
purchased  receivables are required to be paid to a lock box account. A lock box
account is a post office box,  called a lock box,  established  by the bank that
processes  the  payments.  Payments  are  sent  directly  to these  lock  boxes.
Therefore,  the  third-party  payor payments of  receivables  will not go to the
seller,  but  rather  will be sent to the  appropriate  lock box.  When a seller
enters  into a  receivables  purchase  agreement,  a notice of change in mailing
address is sent to all payors of the receivables that are being  purchased.  The
notice will instruct the payors to deliver all payments to the appropriate  lock
box  account.  Each lock box is  established  and  functions  solely to  receive
payments.  When payments are sent to the lock box, the lock box processing  bank
deposits the payment into a lock box account with that bank.

     Separate lock box accounts will be established for each seller. Receivables
due and owing from  government  programs are subject to laws and regulations not
applicable to commercial payors.  Except in limited cases, Medicare and Medicaid
laws  and  regulations   provide  that  payments  for  services  rendered  under
government  programs  can  only be  made to the  healthcare  provider  that  has
rendered  the  services.  Therefore,  each  seller  will  have  a lock  box  for
non-government  collections and a separate lock box for government  collections,
like Medicare,  Medicaid, CHAMPUS, etc. The lock box account will be in the name
of the seller and National  Healthcare  Financial  Services.  for the government
collections,  and will be in the name of National Healthcare Financial Services.
for the non-government collections. The bank lock box proceeds are maintained in
a zero balance account which will be swept daily by each bank maintaining a lock
box  account  to the cash  concentration  account  that is under the  control of
National Healthcare Financial Corp.

     Weekly reports of purchased receivables are generated on a seller by seller
basis.  These reports provide currently  updated accounts  receivable agings and
other  valuable  portfolio  information,   including  claim  denial  trends  and
collections  performance.  Copies  of  these  weekly  reports  are  sent  to our
executive  offices  and the payment  and aging  update  reports are sent to each
seller.

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<PAGE>

     SERVICING OF RECEIVABLES.  Once a receivable is purchased we will regularly
run reports  showing  receipts from the account  receivable  purchased from each
medical  provider.  These  reports will show the progress of  collections  being
paid.  If the  reports  show a delay in  payments,  we will  call  the  payor to
determine the reason for the delay.  If a purchased  receivable is rejected by a
payor or becomes  outstanding for over 20 days, we will take appropriate  action
which may include:

*    offset the amount  actually paid to the seller for the  receivable  against
     the seller's reserve account.
*    offset the amounts due to the seller from the purchase of other  batches of
     receivables
*    require the seller to replace the uncollected  receivables  with additional
     receivables; or
*    exercise our rights under a guarantee from the seller, if any.

     Third party  payors will  generally  pay within a 30 day to 120 day period.
NHFS discounts its fees from funding to the medical  provider on the purchase of
the  receivables  NHFS's profits are derived at funding from the purchase of the
medical receivables.

CREDIT LOSS POLICY AND EXPERIENCE

     We  will  regularly  review  our  outstanding   healthcare  receivables  to
determine the adequacy of our allowance for losses on receivables. To date, none
of our  affiliates  has  experienced  any net  credit  losses  on the  pools  of
receivables  they  hold.  We expect to  maintain  the  allowance  for  losses on
receivables at an amount estimated to be sufficient to absorb future losses, net
of  recoveries,  inherent  in the  healthcare  receivables.  In  evaluating  the
adequacy  of the  allowance,  we  expect  to  consider  factors  like  trends in
healthcare  sub-markets,  past-due accounts,  historical charge-off and recovery
rates, credit risk indicators, economic conditions, on-going credit evaluations,
overall portfolio size, average seller balances,  reserve account balances, real
estate collateral valuations,  if any, and underwriting policies.  However, many
of these considerations involve the significant use of estimates and are subject
to rapid changes which may be unforeseen and could result in immediate increased
losses and material adjustments to the allowance or actual losses.

     To the extent that we may deem specific healthcare receivables to be wholly
or partially  uncollectable,  we will establish a specific loss reserve equal to
that amount.  We have not  established  an allowance for losses because we are a
newly formed company.  There can be no assurance that any allowance  established
in the future will be adequate to cover any losses we may experience.  We expect
to use a general  guideline for credit loss allowances of 2% of outstanding debt
at the time of reporting.  However,  this  guideline will be adjusted to reflect
the performance of each individual client.

     Because we are likely to collect more than the amount initially paid to the
seller of the  receivable,  the  portion  of the  purchase  price  that has been
withheld represents a reserve, or additional security, for the collection of the
amounts due under all of the  receivables  from that  seller.  The amount of the
holdback of a portion of the receivables' purchase price that does not represent
a yield to us upon  collection  of the  receivable  is  allocated to the reserve
account of that seller.  In some cases,  some or all of the balance of a reserve
account can be returned to the seller.  If a receivable  is in default,  we will
take measures to recover the purchase price. These measures include reducing the
sellers balance in its reserve  account,  seeking  replacement of the receivable
from the seller,  or  enforcing  corporate or personal  guarantees  given by the
seller, if any.

                                       9
<PAGE>

TITLE TO RECEIVABLES

     We believe that the  receivables  purchase  transactions we will enter into
will be "true sales" and the purchased receivables will be owned by us. However,
the purchase of a receivable might be characterized as a secured financing, or a
loan  secured  by the  receivables.  Therefore,  we will  also  take a  security
interest in each receivable  purchased and will file a UCC-1 financing statement
covering the receivables. If it is determined that a true sale of the receivable
has not occurred, we will be able to foreclose on the receivable or the proceeds
of the receivable as security for the amount paid for the receivable.

COMPETITION

     We expect to encounter  significant  competition in our healthcare  finance
business from numerous commercial banks, diversified finance companies,  secured
lenders and specialty  healthcare  finance  companies.  In addition,  healthcare
providers often seek alternative  sources of financing from a number of sources,
including venture capital firms, small business investment companies,  suppliers
and individuals. As a result, we will compete with a significant number of local
and regional sources of financing and several large national  competitors.  Many
of these  competitors have greater  financial and other resources than we do and
may have  significantly  lower costs of funds.  Competition can take many forms,
including the pricing of the financing, transaction structuring, like the use of
securitization   vs.  portfolio   lending,   timeliness  and  responsiveness  in
processing a client's financing application and customer service.  Although many
of our  competitors  have focused their business on large  hospitals and clinics
and generally prefer to buy receivables in multi-million  dollar  denominations,
typically with a lower profit margin,  these  competitors could enter our target
markets more aggressively in the future.

GOVERNMENT REGULATION

     Our  healthcare  finance  business  will be subject  to  federal  and state
regulation and supervision.  Currently, there are no regulations that require us
to obtain  specific  licenses  or  approvals,  other  than those  applicable  to
businesses  in  general,  to be able to  purchase  receivables  in the  State of
Florida. We will continually research and monitor regulations and will apply for
the appropriate  licenses if regulations change and require us to be licensed to
perform our business in any particular state in which we may operate.

     Our  business  will  be  affected  by our  inability  to  directly  collect
receivables  under  government  programs  and the  right of payors  under  these
programs to offset against  unrelated  receivables.  Our healthcare  receivables
purchase business will also be indirectly  affected by healthcare  regulation to
the extent  that any of our  sellers'  failures  to comply  with the  applicable
regulations affects our ability to collect their receivables.

EMPLOYEES

     As of October 6, 2002 we employed no full-time employees. All activities to
date have been  undertaken  by our officers.  We  anticipate  that we will begin
hiring  employees  as needed to support our entry into our  proposed  healthcare
receivable financing business.

                                       10
<PAGE>

ITEM 2. DESCRIPTION OF PROPERTIES

     Our  principal  executive  offices are located at 2754 W.  Atlantic  Blvd.,
Suite 4, Pompano  Beach,  FL 33069.  We lease 100 square feet of office space at
that  location  pursuant  to a lease  with an  independent  landlord.  The lease
expired  in  July  2002  and  we  are   continuing  to  lease  the  space  on  a
month-to-month  basis for a monthly rental of $143. We believe that our existing
facilities are adequate for our current needs and that suitable additional space
will be available as needed.


ITEM 3. LEGAL PROCEEDINGS

     None.

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

     None.


PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

     There is no public market for our common stock.

     We have 24 record holders of our common stock.

     There are no restrictions on our ability to pay dividends. We have not paid
any dividends on our Common Stock,  and it is not anticipated that any dividends
will be paid in the foreseeable future. The declaration and payment of dividends
in the  future  will be  determined  by the  Board  of  Directors  in  light  of
conditions then existing, including the company's earnings, financial condition,
capital requirements and other factors.

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

PLAN OF OPERATION

     Our  primary  focus  over  the  course  of  the  next  12  months  will  be
concentrated  on building a portfolio of healthcare  receivables  purchased from
healthcare  providers.  Generally,  we will  limit our  purchase  of  healthcare
receivables to obligations of commercial insurance carriers,  health maintenance
organizations  and debts guaranteed by a state or the United States  government,
including Medicare and Medicaid.

     We were  recently  formed and all  activity to date has been related to our
formation of our business,  formulation of our business plan and the development
of our  proposed  financing.  Our  ability to  commence  our  proposed  business
operations depends upon our obtaining adequate financial  resources through this
offering.

                                       11
<PAGE>

     We believe  that we require a minimum  of $50,000 of  available  capital to
begin purchasing healthcare  receivables.  If such capital is not raised we will
continue operating in the developmental stage, in which event we believe we have
adequate cash on hand for approximately 24 months.

     Our  officers  will provide  daily  management  of our  company,  including
marketing,  administration,  financial  management,  underwriting,  purchase and
collection  of  receivables.  We will also engage  other  employees  and service
organizations to provide needed services as the need for them arise. These could
include  services  such  as  computer  systems,   marketing,   cash  management,
collections, accounting, and administration.

     There can be no assurance that we will be able to successfully purchase any
healthcare  receivables.  We  believe  that  we  can  control  the  general  and
administrative  expenses of our  operations to be within the cash available from
this offering and from the collections on the receivables which we may purchase.
If our initial  operations  indicate  that our business can fulfill a demand for
the  purchase  of  healthcare   receivables  on  a  basis  which  will  lead  to
establishment of a profitable business we may seek additional sources of cash to
grow the business.  We do not currently have any commitments for the purchase of
healthcare receivables or for additional financing.

ITEM 7: FINANCIAL STATEMENTS.

     Our financial statements are filed after the signature page.

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

     None.


Part III

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

Our directors and executive officers are:

     Name                 Age    Position

David Bullard             34     President and Chief Executive Officer, promoter

Robert Dwyer              47     Vice President and Chief Financial Officer

Edward L. Reid II M.D.    67     Chairman and Director

John W. Hemmer            74     Director

Robert Wilson             49     Director and Secretary, promoter


                                    12
<PAGE>

David Bullard,  President and Chief Executive Officer since May 28, 2001. He has
also served as a market consultant for Medfusion since February 2001.

     From  April 2000 to March  2001,  Mr.  Bullard  held the  position  of Vice
President  of  Business  Development  for  National  Internet  Health  Resources
Institute, an internet medical records firm.

     From 1997 to 2000, Mr. Bullard held the position of Administrator with Wake
Internal Medicine Consultants, Inc. His duties included management of a start-up
urgent care center and a SMO.

     From 1996 to 1997,  Mr.  Bullard  held the  position of Vice  President  of
Business Development and Marketing with Integrated Occupational Systems, Inc.

     From 1995 to 1996,  Mr.  Bullard held the  positions of  Administrator  and
Director of Operations  with Carolina  Physicians  Network.  His duties included
management  of family  medical  practices  in the  Carolina  area.  Achievements
include  M & A  duties  for  successful  startup  integrated  delivery  network.
Creation  of a consumer  - oriented  health  services  business  with first year
revenues of $700,000, including strategic partnerships with local industry.

     Mr. Bullard holds a Masters Degree in Healthcare  Administration as well as
a Post  Graduate  Fellowship  from  Carolinas  Healthcare  System.  He held  the
position of President in 2000 for the Triangle Medical Managers Association.  He
is  currently  a  member  in good  standing  with  the  Medical  Group  Managers
Association.

Robert  Dwyer,  Vice  President and Chief  Financial  Officer since May 28,2001.

     Mr. Dwyer has over twenty years of entrepreneurial  experience in business,
new market and product development, sales and marketing management, and business
start-ups, as well as in the development of systems for production, cost control
and administration.  In 1992, Mr. Dwyer founded Fidelity Capital Corporation,  a
factoring  company and has served as it President and CEO since that time.  From
1988 -1992 he served in various  executive  positions for Tech Aid  Corporation,
Data Management Systems International,  and United Cartridge  Corporation.  From
the late 1970's until 1988,  he founded  three  companies,  which he later sold:
5001/2 Environmental Design, Dagwood's Restaurants, and Habitat Construction. He
attended  the  University  Of  Richmond  in the early  1970's and  received  his
Bachelors degree from Virginia Commonwealth University in 1978.

Edward L. Reid II M.D., Chairman since May 28, 2001.

     Edward L. Reid,  II.,  M.D. is a physician in his own practice  since 1969,
specializing in internal medicine and endocrinology.  Dr. Reid was a director of
International  Airline  Support Group from October 1989 through January of 1991,
which was in involved in the sale of airplane parts.  Prior to that time, he was
the Director and President of Medical Care  Development  Corp. from October 1986
through  June  1988,  and  was  the   Secretary/Treasurer  of  its  wholly-owned
subsidiaries  Bayside Medical  Equipment,  Inc., and Bayside Home Health,  Inc.,
from January 1987 through June 1988.  Those provided  medical  services and home
health care.  Dr. Reid was a director of the John T. McDonald  foundation  which
was a not-for-  profit  corporation  that  oversaw  the  operations  of Doctor's
Hospital and Larkin General Hospital in Miami from December 1985 through January
of 1988. Dr. Reid has been  published  numerous times and has been an instructor
and Professor of Medicine at the University of Miami School of Medicine.

                                       13
<PAGE>

John W. Hemmer, Director since May 28, 2001.

     John W. Hemmer has served as Vice President of Finance and Chief  Financial
Officer of the Paradigm Medical Industries, a developer of laser systems for eye
surgery,  from September 20, 2000 to October 2001, when he was named Senior Vice
President.  Mr. Hemmer  served as Vice  President of Finance,  Treasurer,  Chief
Financial  Officer and a director of Paradigm  Medical  Industries from November
1995 to June 1999.

     Mr.  Hemmer  has  served  as a  consultant  and a  director  of Bio  Marine
Technolgies, Inc., since 1989 and was Chief Financial Officer from February 2000
until  October 1, 2001. He retired as a director in December,  2001.  Bio Marine
Technologies,  Inc. of Gulf Breeze, Florida, develops offshore marine production
systems for oyster  production  licensed  and  permitted  for use in the Gulf of
Mexico.

     Mr. Hemmer  received a B.A. degree in Economics from Queens College in 1951
and a M.S.  degree in Banking  and Finance  from  Columbia  University  Graduate
School of Business in 1952.

Robert Wilson, Director since May 28, 2001.

     Robert  Wilson is currently  the COO of eCom  eCom.com,  Inc.,  an Internet
based e-commerce  company. He formerly served as the acting President and COO of
eWebPEO.com, Inc. of Palm Beach Gardens, Florida during the year 2000..

     From 1995 through 2000,  Robert Wilson was the Managing  General Partner of
Wilson  and  Associates,  where he  established  a medical  accounts  receivable
factoring company.

     From 1992  through  1995 he served as Vice  President  of Sales for Optimum
Capital  Corporation,   Walnut  Creek,   California,   where  he  managed  sales
representatives  of the company,  successfully  implemented new recruit training
programs, and increased monthly sales five-fold.

     Prior to his work at Optimum Capital  Corporation,  Robert Wilson worked at
Healthcare Revenue Management, in San Francisco,  California, where he initiated
new programs,  expanded the sales team, and substantially increased annual sales
for the company.

     Mr.  Wilson  brings  experience  in planning,  sales  strategies  and sales
motivation.

     Our  directors  are elected  yearly and hold  office  until the next annual
meeting of shareholders and the election and qualification of their successors.

     Our  officers  are elected  annually by the board of  directors  and may be
replaced or removed by the board at any time.  Our  directors are elected by our
shareholders  annually and serve until the election and  qualification  of their
successors or their earlier resignation or removal.

Board of Director Committees

     Our board has not yet established any committees.

                                       14
<PAGE>

ITEM 10: EXECUTIVE COMPENSATION

     Our officers have verbally  agreed to provide their  services to us without
compensation  until we have sufficient  working capital to establish  reasonable
compensation.  At that time,  the board of directors  and officers  will seek to
agree upon  employment  agreements  providing a compensation  package which will
fairly  compensate  them for their future  services and be within our  available
financial resources.

Other Compensation Plans

     We have not  established  any long term  compensation  plans,  stock  based
compensation  plans,  incentive  compensation  plans  or other  compensation  or
benefit plans. We anticipate that such plans will be established as our business
develops.

Director Compensation

     We issued  shares to several of our  directors  in  consideration  of their
serving as directors until the next annual meeting of shareholders as follows:

         Edward L. Reid II M.D.             500 shares
         John W. Hemmer                     200 shares

     We do not have any other arrangements for compensating our directors.


COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT


     Based solely on its review of Forms 3, 4 and 5 received by the company,  or
written  representations  from  certain  reporting  persons that no Forms 5 were
required for such persons,  the company  believes  that,  during the fiscal year
ended  July  31,  2002,  all  filing  requirements  under  Section  16(a) of the
Securities  Exchange  Act of 1934  applicable  to  officers,  directors  and 10%
shareholders were satisfied.

Promoters

     We  were  founded  in May  2001.  Robert  Wilson  and  David  Bullard  were
instrumental in our organization and may be considered promoters of our company.
As consideration  for their services in connection with our  organization,  such
promoters received 16,660 shares of our common stock.

ITEM 11: SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The  following  table sets  forth,  as of October 7, 2002,  the  beneficial
ownership  of our  55,890  outstanding  shares of  Common  Stock by (1) the only
persons who own of record or are known to own beneficially,  more than 5% of our
Common Stock; (2) each director and executive officer; and (3) all directors and
officers as a group and the percentage owned as of such date.


                                Number of
Name and Addresses(1)           Shares               Percent Beneficially Owned

David Bullard                   1,000                       *
Robert Dwyer                      200                       *
Edward L. Reid II M.D.            500                       *
John W. Hemmer                    200                       *
Robert Wilson                  10,060                       19.5%
Roger Katen                     5,490                        9.8%

All directors and officers
    as a group (5 persons)     11,960                       23.2%

* less than 2%

(1)  The address for all persons  listed is c/o  National  Healthcare  Financial
     Services, Inc., 2754 W. Atlantic Blvd., Suite 4, Pompano Beach, FL 33069.

                                       15
<PAGE>

ITEM 12: CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

       None


PART 1V

ITEM 13: EXHIBITS AND REPORTS ON FORM 8-K

     (a)  Exhibits

Exhibit No.           Description


2(a)                Articles of Incorporation of the Registrant. Incorporated by
                    Reference  to  Exhibit  2(a)  to  Registrant's  registration
                    statement on Form SB-2 (file no. 333-72976).

2(b)                Articles  of  Amendment  to  Articles  of   Incorporation  -
                    Incorporated  by Reference  to Exhibit 2(b) to  Registrant's
                    registration statement on Form SB-2 (file no. 333-72976).

2(c)                By-Laws of the Registrant - same as above.  Incorporated  by
                    Reference  to  Exhibit  2(c)  to  Registrant's  registration
                    statement on Form SB-2 (file no. 333-72976).

2(d)                Form of Common Stock Certificate - Incorporated by Reference
                    to Exhibit 2(d) to  Registrant's  registration  statement on
                    Form SB-2 (file no. 333-72976).

6(a)                Lease  Agreement - Incorporated by Reference to Exhibit 6(a)
                    to  Registrant's  registration  statement on Form SB-2 (file
                    no. 333-72976

99.1                Certification   by   CEO   pursuant   to   Section   906  of
                    Sarbanes-Oxley Act of 2002.

99.2                Certification   by   CFO   pursuant   to   Section   906  of
                    Sarbanes-Oxley Act of 2002.


     (b)  REPORTS ON FORM 8-K.

         None.

Item 14. Controls and Procedures

     The Company maintains  disclosure controls and procedures that are designed
to ensure that  information  required to be disclosed in the Company's  Exchange
Act reports is recorded,  processed,  summarized  and  reported  within the time
periods  specified in the SEC's rules and forms,  and that such  information  is
accumulated and  communicated to the Company's  management,  including its Chief
Executive Officer and Chief Financial Officer,  as appropriate,  to allow timely
decisions  regarding  required  disclosure  based  closely on the  definition of
"disclosure  controls  and  procedures"  in Rule  13a-14(c).  In  designing  and
evaluating the disclosure  controls and procedures,  management  recognized that
any controls and  procedures,  no matter how well  designed  and  operated,  can
provide only reasonable  assurance of achieving the desired control  objectives,
and management  necessarily was required to apply its judgment in evaluating the
cost-benefit relationship of possible controls and procedures.

     Within 90 days prior to the date of this report, the Company carried out an
evaluation,  under the supervision and with the  participation  of the Company's
management,  including the Company's Chief  Executive  Officer and the Company's
Chief Financial Officer, of the effectiveness of the design and operation of the
Company's  disclosure  controls  and  procedures.  Based on the  foregoing,  the
Company's Chief Executive Officer and Chief Financial Officer concluded that the
Company's disclosure controls and procedures were effective.

     There have been no significant  changes in the Company's  internal controls
or in other  factors  that  could  significantly  affect the  internal  controls
subsequent to the date the Company completed its evaluation.

                                       16
<PAGE>

                                   SIGNATURES

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

                          NATIONAL HEALTHCARE FINANCIAL
                                 SERVICES, INC.



                               By: s/David Bullard
                     President/principal executive officer/
                          principal accounting officer


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

Signature                      Title                             Date

s/David Bullard           President/principal                November 19, 2002
David Bullard             executive officer/
                          principal accounting officer

s/Edward L. Reid II M.D.  Chairman and Director              November 19, 2002
Edward L. Reid II M.D.

s/John W. Hemmer          Director                           November 19, 2002
John W. Hemmer

s/Robert Wilson           Director                           November 19, 2002
Robert Wilson

                                       17
<PAGE>

Certifications

I,  David Bullard, certify that:

1.   I have reviewed  this annual  report on Form 10-KSB of National  Healthcare
     Financial Services, Inc.;

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

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

4.   The  registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

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

        b)     evaluated  the  effectiveness  of  the  registrant's   disclosure
               controls and  procedures as of a date within 90 days prior to the
               filing date of this annual report (the "Evaluation Date"); and

        c)     presented  in  this  annual  report  our  conclusions  about  the
               effectiveness of the disclosure  controls and procedures based on
               our evaluation as of the Evaluation Date;

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

        a)     all  significant  deficiencies  in the  design  or  operation  of
               internal  controls which could adversely  affect the registrant's
               ability to record,  process,  summarize and report financial data
               and have  identified for the  registrant's  auditors any material
               weaknesses in internal controls; and

        b)     any fraud,  whether or not material,  that involves management or
               other employees who have a significant  role in the  registrant's
               internal controls; and

6.   The  registrant's  other  certifying  officers and I have indicated in this
     annual report whether there were significant  changes in internal  controls
     or in other  factors  that could  significantly  affect  internal  controls
     subsequent  to the  date  of our  most  recent  evaluation,  including  any
     corrective  actions with regard to  significant  deficiencies  and material
     weaknesses.

Date:  November 19, 2002


S/David Bullard
David Bullard
Chief Executive Officer

                                       18
<PAGE>

I,  David Bullard, certify that:

1.   I have reviewed  this annual  report on Form 10-KSB of National  Healthcare
     Financial Services, Inc.;

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

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

4.   The  registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

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

        b)     evaluated  the  effectiveness  of  the  registrant's   disclosure
               controls and  procedures as of a date within 90 days prior to the
               filing date of this annual report (the "Evaluation Date"); and

        c)     presented  in  this  annual  report  our  conclusions  about  the
               effectiveness of the disclosure  controls and procedures based on
               our evaluation as of the Evaluation Date;

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

        a)     all  significant  deficiencies  in the  design  or  operation  of
               internal  controls which could adversely  affect the registrant's
               ability to record,  process,  summarize and report financial data
               and have  identified for the  registrant's  auditors any material
               weaknesses in internal controls; and

        b)     any fraud,  whether or not material,  that involves management or
               other employees who have a significant  role in the  registrant's
               internal controls; and

6.   The  registrant's  other  certifying  officers and I have indicated in this
     annual report whether there were significant  changes in internal  controls
     or in other  factors  that could  significantly  affect  internal  controls
     subsequent  to the  date  of our  most  recent  evaluation,  including  any
     corrective  actions with regard to  significant  deficiencies  and material
     weaknesses.

Date:  November 19, 2002


S/David Bullard
David Bullard
Chief Financial Officer
                                       19
<PAGE>

 National Healthcare Financial Services, Inc.
                          (A Development Stage Company)

                              Financial Statements

                                  June 30, 2002



                  National Healthcare Financial Services, Inc.
                          (A Development Stage Company)


                                    Contents


                                                                     Page(s)
                                                                  -----------

Independent Auditors' Report                                           1

Balance Sheet                                                          2

Statements of Operations                                               3

Statement of Changes in Stockholders' Equity                           4

Statements of Cash Flows                                               5

Notes to Financial Statements                                          6 - 10


                                       20
<PAGE>


                          Independent Auditors' Report

To the Board of Directors of:
   National Healthcare Financial Services, Inc.
   (A Development Stage Company)

We have audited the accompanying  balance sheet of National Healthcare Financial
Services, Inc. (a development stage company) as of June 30, 2002 and the related
statements of operations, changes in stockholders' equity and cash flows for the
year then ended,  for the period from May 3, 2001  (inception)  to June 30, 2001
and for the  period  from  May 3,  2001  (inception)  to June  30,  2002.  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 audit.

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

In our opinion, the financial statements referred to above present fairly in all
material  respects,  the  financial  position of National  Healthcare  Financial
Services,  Inc.  (a  development  stage  company) as of June 30,  2002,  and the
results of its  operations  and its cash flows for the year then ended,  for the
period from May 3, 2001 (inception) to June 30, 2001 and for the period from May
3, 2001  (inception) to June 30, 2002, in conformity with accounting  principles
generally accepted in the United States of America.

The  accompanying  financial  statements  have been  prepared  assuming that the
Company will  continue as a going  concern.  As  discussed  in the  accompanying
financial  statements,  the  Company  has net losses for the year ended June 30,
2002 of $22,116,  a deficit  accumulated during the development stage of $28,367
at June 30,  2002,  net cash used in  operations  in 2002 of  $18,313,  and is a
development  stage company with no revenues.  These  matters  raise  substantial
doubt about its ability to continue  as a going  concern.  Management's  Plan in
regards to these matters is also  described in Note 6. The financial  statements
do not  include  any  adjustments  that might  result  from the  outcome of this
uncertainty.


SALBERG & COMPANY, P.A.
Boca Raton, Florida
September 25, 2002

                                       1
<PAGE>



                  National Healthcare Financial Services, Inc.
                          (A Development Stage Company)
                                  Balance Sheet
                                  June 30, 2002

                                     Assets
Assets
 Cash                                                       $        28,640
                                                                --------------

Total Current Assets                                        $        28,640
                                                                ==============

                      Liabilities and Stockholder's Equity

Liabilities
Accounts payable and accrued expenses                       $         3,514
Notes payable                                                        17,520
                                                                --------------
Total Current Liabilities                                            21,034
                                                                --------------

Stockholders' Equity
Preferred stock, $0.0001 par value, 20,000,000 shares authorized,         -
   none issued and outstanding
Common stock, $0.0001 par value, 80,000,000 shares authorized,            6
   55,890 shares issued and outstanding
Additional paid-in capital                                           35,967
Deficit accumulated during development stage                        (28,367)
                                                                --------------
Total Stockholders' Equity                                            7,606
                                                                --------------

Total Liabilities and Stockholders' Equity                  $        28,640
                                                                ==============



                 See accompanying notes to financial statements
                                        2
<PAGE>



                  National Healthcare Financial Services, Inc.
                          (A Development Stage Company)
                            Statements of Operations
<TABLE>
<S>                                                                  <C>              <C>              <C>


                                                                        Year Ended June 30,                From
                                                                                                       May 3, 2001
                                                                                                      (inception) to
                                                                                                      June 30, 2002
                                                                       2002             2001
                                                                    -----------      -----------     -----------------
Operating Expenses
Compensation                                                    $          50   $        4,165   $             4,215
Director fees                                                             175             -                      175
General and administrative                                              1,915             -                    1,915
Professional fees                                                      16,205            2,000                18,205
Rent                                                                    1,843             -                    1,843
                                                                    -----------      -----------     -----------------
Total Operating Expenses                                               20,188            6,165                26,353
                                                                    -----------      -----------     -----------------

Loss from Operations                                                  (20,188)          (6,165)              (26,353)

Other Expense
Interest expense                                                        1,928               86                 2,014
                                                                    -----------      -----------     -----------------
Total Other Expense                                                     1,928               86                 2,014
                                                                    -----------      -----------     -----------------

Net Loss                                                        $     (22,116)  $       (6,251)  $           (28,367)
                                                                    ===========      ===========     =================

Net loss per share - basic and diluted                          $       (0.47)  $        (0.38)  $             (0.66)
                                                                    ===========      ===========     =================

Weighted average number of shares outstanding during the               47,237           16,660                43,296
   period - basic and diluted                                       ===========      ===========     =================

</TABLE>
                 See accompanying notes to financial statements
                                        3


<PAGE>



                  National Healthcare Financial Services, Inc.
                          (A Development Stage Company)
                  Statement of Changes in Stockholders' Equity
                         From May 3, 2001 (Inception) to
                                  June 30, 2002

<TABLE>
<S>                                          <C>           <C>             <C>                    <C>               <C>

                                                  Common Stock             Additional            Deficit             Total
                                                                             Paid-in           Accumulated
                                                                             Capital              During
                                                                                               Development
                                                                                                  Stage
                                             Shares         Amount
                                            ----------    ------------   ----------------    -----------------    -----------

Common stock issued for services to           16,660   $           2              4,163   $             -      $       4,165
  founders

Net loss from May 3, 2001 (inception) to        -               -                  -                  (6,251)         (6,251)
  June 30, 2001
                                            ----------    ------------   ----------------    -----------------    -----------

Balance, June 30, 2001                        16,660               2              4,163               (6,251)         (2,086)

Common stock issued for cash                  37,730               4             31,429                 -             31,433

Common stock issued for services               1,500            -                   375                 -                375

Net loss, 2002                                  -               -                  -                 (22,116)        (22,116)
                                            ----------    ------------   ----------------    -----------------    ----------

Balance, June 30, 2002                        55,890   $           6             35,967   $          (28,367)   $      7,606
                                            ==========    ============   ================    =================    ============

</TABLE>

                 See accompanying notes to financial statements
                                        4


<PAGE>



                  National Healthcare Financial Services, Inc.
                          (A Development Stage Company)
                            Statements of Cash Flows

<TABLE>
<S>                                                                                 <C>                     <C>
                                                                                 Year Ended               From
                                                                                June 30, 2002          May 3, 2001
                                                                                                     (inception) to
                                                                                                      June 30, 2002
                                                                              ------------------    ------------------
Cash Flows from Operating Activities
Net loss                                                                   $           (22,116)  $           (28,367)
Adjustments to reconcile net loss to net cash used in operating
  activities:
Stock based compensation, professional fees                                                375                 4,540
Changes in operating assets and liabilities:
(Increase) decrease in:
Accounts payable and accrued expenses                                                    3,428                 3,514
                                                                              ------------------    ------------------
Net Cash Used in Operating Activities                                                  (18,313)              (20,313)
                                                                              ------------------    ------------------

Cash Flows from Financing Activities
Proceeds from loans                                                                      7,520                17,520
Proceeds from sales of common stock                                                     31,433                31,433
                                                                              ------------------    ------------------
Net Cash Provided by Financing Activities                                               38,953                48,953
                                                                              ------------------    ------------------

Net Increase in Cash                                                                    20,640                28,640

Cash at Beginning of Period                                                              8,000                  -
                                                                              ------------------    ------------------

Cash at End of Period                                                      $            28,640   $            28,640
                                                                              ==================    ==================

</TABLE>
                 See accompanying notes to financial statements
                                        5

<PAGE>

                  National Healthcare Financial Services, Inc.
                          (A Development Stage Company)
                          Notes to Financial Statements
                                  June 30, 2002


Note 1   Nature of Business and Significant Accounting Policies

   (A)    Organization  and Nature of  Business

          National  Healthcare  Financial  Services,  Inc. (a development  stage
          company) (the  "Company") was  incorporated in Florida on May 3, 2001,
          and has elected a fiscal year end of June 30.

          The  Company  is a  specialty  finance  company  offering  asset-based
          financing and factoring of receivables to healthcare service providers
          with a  primary  focus on  clients  operating  in  sub-markets  of the
          healthcare  industry,  including long-term care, home healthcare,  and
          physician practice.

          Activities  during  the  development  stage  include   developing  the
          corporate infrastructure and business plan and raising capital.

   (B)    Use of Estimates

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

   (C)    Cash and Cash Equivalents

          For the purpose of the Statement of Cash Flows, the Company  considers
          all short-term debt securities purchased with maturity of three months
          or less to be cash equivalents.

   (D)    Income Taxes

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

   (E)    Net Loss Per Common Share

          Basic net income (loss) per common share (Basic EPS) excludes dilution
          and is computed  by dividing  net income  (loss)  available  to common
          stockholder   by  the   weighted-average   number  of  common   shares
          outstanding for the period. Diluted net income per share (Diluted EPS)
          reflects the  potential  dilution that could occur if stock options or
          other contracts to issue common stock were exercised or converted into
          common  stock or  resulted in the  issuance of common  stock that then
          shared in the earnings of the Company. At June 30, 2002, there were no
          common stock equivalents  outstanding which may dilute future earnings
          per share.

                                       6
<PAGE>

   (F)    Fair Value of Financial Instruments

          Statement  of Financial  Accounting  Standards  No. 107,  "Disclosures
          about Fair Value of Financial  Instruments,"  requires  disclosures of
          information about the fair value of certain financial  instruments for
          which it is practicable  to estimate that value.  For purposes of this
          disclosure,  the fair value of a financial instrument is the amount at
          which the  instrument  could be  exchanged  in a  current  transaction
          between willing parties, other than in a forced sale or liquidation.

          The   carrying   amounts  of  the   Company's   short-term   financial
          instruments,  including accrued expenses and notes payable approximate
          fair value due to the  relatively  short  period to maturity for these
          instruments.

   (G)    New Accounting Pronouncements

          Statement No. 141  "Business  Combinations"  ("SFAS 141")  establishes
          revised   standards   for   accounting   for  business   combinations.
          Specifically,  the statement  eliminates the pooling method,  provides
          new guidance for recognizing  intangible  assets arising in a business
          combination, and calls for disclosure of considerably more information
          about a business combination. This statement is effective for business
          combinations  initiated on or after July 1, 2001. The adoption of this
          pronouncement  on July 1, 2001 did not have a  material  effect on the
          Company's financial position, results of operations or liquidity.

          Statement No. 142 "Goodwill and Other Intangible  Assets" ("SFAS 142")
          provides new guidance concerning the accounting for the acquisition of
          intangibles, except those acquired in a business combination, which is
          subject to SFAS 141, and the manner in which  intangibles and goodwill
          should be  accounted  for  subsequent  to their  initial  recognition.
          Generally,  intangible assets with indefinite lives, and goodwill, are
          no longer  amortized;  they are carried at lower of cost or market and
          subject  to  annual  impairment  evaluation,   or  interim  impairment
          evaluation if an interim  triggering  event  occurs,  using a new fair
          market value method. Intangible assets with finite lives are amortized
          over those lives, with no stipulated  maximum,  and an impairment test
          is performed  only when a triggering  event occurs.  This statement is
          effective for all fiscal years  beginning after December 15, 2001. The
          implementation  of SFAS 142 is not expected to have a material  effect
          on  the  Company's  financial  position,   results  of  operations  or
          liquidity.

          Statement  No. 143,  "Accounting  for Asset  Retirement  Obligations,"
          ("SFAS 143") requires entities to record the fair value of a liability
          for an  asset  retirement  obligation  in the  period  in  which it is
          incurred.  When  the  liability  is  initially  recorded,  the  entity
          capitalizes  a cost by increasing  the carrying  amount of the related
          long-lived  asset. Over time, the liability is accreted to its present
          value each period,  and the capitalized  cost is depreciated  over the
          useful life of the related asset. Upon settlement of the liability, an
          entity either settles the obligation for its recorded amount or incurs
          a gain or loss upon  settlement.  The standard is effective for fiscal
          years  beginning  after June 15, 2002. The adoption of SFAS 143 is not
          expected  to  have  a  material  impact  on  the  Company's  financial
          statements.

                                       7
<PAGE>

          Statement  No. 144  "Accounting  for the  Impairment  or  Disposal  of
          Long-Lived   Assets"  ("SFAS  144")   supercedes   Statement  No.  121
          "Accounting for the Impairment of Long-Lived Assets and for Long-Lived
          Assets to be Disposed  of" ("SFAS  121").  Though it retains the basic
          requirements  of  SFAS  121  regarding  when  and  how to  measure  an
          impairment loss, SFAS 144 provides additional implementation guidance.
          SFAS 144 excludes  goodwill and  intangibles not being amortized among
          other  exclusions.  SFAS 144 also supercedes the provisions of APB 30,
          "Reporting  the Results of  Operations,"  pertaining  to  discontinued
          operations.  Separate  reporting of a discontinued  operation is still
          required, but SFAS 144 expands the presentation to include a component
          of an entity,  rather than  strictly a business  segment as defined in
          SFAS 131,  Disclosures  about  Segments of an  Enterprise  and Related
          Information.  SFAS  144  also  eliminates  the  current  exemption  to
          consolidation   when  control  over  a  subsidiary  is  likely  to  be
          temporary.  This statement is effective for all fiscal years beginning
          after  December  15,  2001.  The  implementation  of  SFAS  144 is not
          expected  to  have  a  material  effect  on  the  Company's  financial
          position, results of operations or liquidity.

          Statement No. 145,  "Rescission of FASB  Statements No. 4, 44, and 64,
          Amendment of FASB Statement No. 13, and Technical Corrections," ("SFAS
          145")  updates,   clarifies,   and  simplifies   existing   accounting
          pronouncements.  SFAS 145  rescinds  Statement  4, which  required all
          gains and losses from  extinguishment of debt to be aggregated and, if
          material,  classified as an extraordinary  item, net of related income
          tax effect.  As a result,  the criteria in Opinion 30 will now be used
          to classify those gains and losses.  Statement 64 amended Statement 4,
          and is no longer  necessary  because  Statement 4 has been  rescinded.
          Statement 44 was issued to establish  accounting  requirements for the
          effects of  transition  to the  provisions of the motor Carrier Act of
          1980.  Because the transaction has been completed,  Statement 44 is no
          longer necessary. SFAS 145 amends Statement 13 to require that certain
          lease   modifications   that  have   economic   effects   similar   to
          sale-leaseback  transactions  is  accounted  for in the same manner as
          sale-leaseback transactions.  This amendment is consistent with FASB's
          goal requiring similar accounting treatment for transactions that have
          similar economic effects.  The adoption of SFAS 145 is not expected to
          have a material impact on the Company's financial position, results of
          operations or liquidity.

          Statement No. 146, "Accounting for Exit or Disposal Activities" ("SFAS
          146") addresses the  recognition,  measurement,  and reporting of cost
          that  are  associated  with  exit  and  disposal  activities  that are
          currently  accounted for pursuant to the  guidelines set forth in EITF
          94-3, "Liability Recognition for Certain Employee Termination Benefits
          and Other Costs to exit an Activity  (including  Certain Cost Incurred
          in a  Restructuring),"  cost related to terminating a contract that is
          not a capital  lease and  one-time  benefit  arrangements  received by
          employees who are  involuntarily  terminated - nullifying the guidance
          under EITF 94-3.  Under SFAS 146, the cost  associated with an exit or
          disposal activity is recognized in the periods in which it is incurred
          rather than at the date the Company  committed to the exit plan.  This
          statement is effective for exit or disposal activities initiated after
          December 31, 2002 with earlier application encouraged. The adoption of
          SFAS 146 is not  expected to have a material  impact on the  Company's
          financial position or result of operations.

                                       8
<PAGE>

Note 2   Notes Payable

The Company executed three unsecured promissory notes with one lender for $5,000
on May 18, 2001,  $5,000 on June 28, 2001,  and $2,500 on March 1, 2002 and with
another  lender for $5,000 on November  28,  2001.  The notes have a term of two
years but all unpaid principal and interest shall be due and payable upon demand
365 days after the issuance  date. The notes bear interest at 14% with a default
penalty within 5 days of the due date of 5% of the amount due. At June 30, 2002,
notes payable totaled $17,520 and the related accrued  interest  payable totaled
$2,014.

Note 3   Commitments

In  August  2001,  the  Company   entered  into  a  one-year   office  lease  at
approximately  $143 per month. Rent expense for the year ended June 30, 2002 was
$1,843.

Note 4 Stockholders' Equity

The  Company  issued  16,660  common  shares to its  founders  for  services  at
inception.  The stock was valued at the planned private placement price of $0.25
per share for total compensation expense of $4,165.

In August 2001,  under  Regulation  D private  placement  offering,  the Company
issued 33,330 common shares at $0.25 per share having a fair value of $8,333. In
addition,  the Company issued 700 common shares to two directors,  200 shares to
the  vice-president  for  services  rendered  and 600  common  shares  for legal
services.   The  shares   issued  for  these   services   were   valued  at  the
contemporaneous  cash-offering  price of $0.25 per share resulting in a director
fees expense of $175, compensation expense of $50 and legal expense of $150.

In March 2002,  the Company issued 4,400 common shares at $5.25 per share having
a fair value of $23,100.

Note 5 Income Taxes

There was no income tax expense for the year ended June 30, 2002 and from May 3,
2001 (inception) to June 30, 2001 due to the Company's net losses.

The  Company's tax expense  (benefit)  differs from the  "expected"  tax expense
(benefit) for the year ended June 30, 2002 and from May 3, 2001  (inception)  to
June 30, 2001,  (computed by applying the Federal  Corporate  tax rate of 34% to
loss before taxes), as follows:

                                       9
<PAGE>

<TABLE>
<S>                                                                    <C>              <C>
                                                                         2002            2001
                                                                    -------------    ------------

Computed "expected" tax expense (benefit)                         $       (7,519)  $      (2,125)
Stock Based Compensation                                                     128           1,416
Change in valuation allowance                                              5,975             709
Re-characterization of prior year temporary difference                     1,416            -
                                                                     -------------    ------------
                                                                  $         -      $        -
                                                                     =============    ============
</TABLE>

The effects of temporary  differences that gave rise to significant  portions of
deferred tax assets and liabilities at June 30, 2002 are as follows:

                                                           2002
                                                        ------------
Deferred tax assets:
Net loss carryforward                                $       8,100
Stock based compensation                                      -
                                                        ------------
Total gross deferred tax assets                              8,100
Less valuation allowance                                    (8,100)
                                                        ------------
Net deferred tax assets                              $        -
                                                        ============

The Company has a net  operating  loss  carryforward  of  approximately  $23,826
available to offset future taxable income through 2022.

The valuation allowance at June 30, 2001 was $2,125. The net change in valuation
allowance during the year ended June 30, 2002 was an increase of $5,975.

Note 6   Going Concern

As  reflected  in the  accompanying  financial  statements,  the Company has net
losses for the year ended June 30, 2002 of $22,116, a deficit accumulated during
the  development  stage of $28,367 at June 30, 2002, net cash used in operations
in 2002 of $18,313,  and is a development  stage  company with no revenues.  The
ability of the  Company to  continue  as a going  concern  is  dependent  on the
Company's  ability to further  implement its business plan,  raise capital,  and
generate revenues.  The financial statements do not include any adjustments that
might be necessary if the Company is unable to continue as a going concern.

The Company continues to seek additional  funding.  In addition,  the Company is
negotiating  with potential  customers,  capital  funding  sources,  and service
providers to implement its business plan.  Management  believes that the actions
presently  being  taken to raise  capital,  implement  its  business  plan,  and
generate revenues provide the opportunity for the Company to continue as a going
concern.

                                       10

<PAGE>