UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

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

                    For the fiscal year ended June 30, 2003

[ ]  TRANSITION  REPORT  UNDER  SECTION  13  OR  15(d)  OF  THE  EXCHANGE  ACT

                For the transition period from: ______________ to ______________

                Commission  file  number:  0-28353
                                           -------

                           INTEGRAL TECHNOLOGIES, INC.
--------------------------------------------------------------------------------
           (Name of small business issuer as specified in its charter)

<TABLE>
<CAPTION>
<S>                                                             <C>
                             Nevada                                        98-0163519
--------------------------------------------------------------  ---------------------------------
(State or other jurisdiction of incorporation or organization)  (IRS Employer Identification No.)


    805 W. Orchard Drive, Suite 3, Bellingham, Washington                                 98225
--------------------------------------------------------------                       ------------
            (Address of principal executive offices)                                   (Zip Code)
</TABLE>

Issuer's  telephone  number:   (360)  752-1982
                               ---------------

Securities  registered  under  Section  12(b)  of  the  Exchange  Act:   None
                                                                         ----

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

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

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

     State  issuer's  revenues  for  its  most  recent  fiscal  year.   $21,355.
                                                                        -------

     As  of  September  25, 2003, the aggregate market value of the voting stock
held  by  non-affiliates,  approximately  29,985,185 shares of Common Stock, was
approximately  $32.7  million  based  on an average of the bid and ask prices of
approximately  $1.09  per  share  of  Common  Stock  on  such  date.

     The  number  of  shares outstanding of the issuer's Common Stock, $.001 par
value,  as  of  September  25,  2003  was  33,717,551  shares.

     DOCUMENTS  INCORPORATED  BY  REFERENCE:     None.

     Transitional  Small  Business  Disclosure  Format  (check  one):

     Yes  [ ];  No  [X]


<PAGE>
                                     PART I
                                     ------

               CAUTIONARY STATEMENT IDENTIFYING IMPORTANT FACTORS
                THAT COULD CAUSE THE COMPANY'S ACTUAL RESULTS TO
            DIFFER FROM THOSE PROJECTED IN FORWARD LOOKING STATEMENTS

     Readers of this document and any document incorporated by reference herein,
are advised that this document and documents incorporated by reference into this
document  contain  both  statements  of  historical  facts  and  forward looking
statements.  Forward  looking  statements  are  subject  to  certain  risks  and
uncertainties,  which  could cause actual results to differ materially for those
indicated  by  the  forward  looking  statements.  Examples  of  forward looking
statements  include,  but are not limited to (i) projections of revenues, income
or  loss,  earning  or  loss per share, capital expenditures, dividends, capital
structure and other financial items, (ii) statements of the plans and objectives
of  the  Company  or  its  management  or  Board  of  Directors,  including  the
introduction  of  new  products,  or  estimates  or  predictions  of  actions by
customers, suppliers, competitors or regulatory authorities, (iii) statements of
future economic performance, and (iv) statements of assumptions underlying other
statements  and  statements  about  the  Company  or  its  business.

     This  document  and  any  documents  incorporated  by reference herein also
identify important factors which could cause actual results to differ materially
from  those  indicated  by  forward  looking  statements.  These  risks  and
uncertainties include price competition, the decisions of customers, the actions
of  competitors,  the  effects  of government regulation, possible delays in the
introduction  of  new products and services, customer acceptance of products and
services,  the  Company's  ability  to  secure  debt  and/or equity financing on
reasonable  terms,  and  other  factors  which  are  described  herein and/or in
documents  incorporated  by  reference  herein.

     The  cautionary  statements  made above and elsewhere by the Company should
not  be  construed  as  exhaustive or as any admission regarding the adequacy of
disclosures  made  by  the  Company.  Forward  looking statements are beyond the
ability  of  the Company to control and in many cases the Company cannot predict
what  factors  would  cause results to differ materially from those indicated by
the  forward  looking  statements.


ITEM  1.  DESCRIPTION  OF  BUSINESS.
------------------------------------

BUSINESS  DEVELOPMENT
---------------------

     Integral Technologies, Inc. ("Integral," the "Company" or the "Registrant")
is  a  development  stage  company,  incorporated under the laws of the State of
Nevada  on  February  12,  1996.  To  date,  Integral,  directly and through its
subsidiaries,  has  expended  its  resources  on the research and development of
several  different  types  of  technologies.

     Presently,  Integral  is focusing substantially all of its resources on the
researching,  developing  and  commercializing  of  new  antenna  technologies,
directly  and  through  its  wholly-owned  subsidiary,  Antek  Wireless,  Inc.

ANTENNA PRODUCTS
----------------

     The  Company  is  focusing  its  marketing  efforts  through  to the end of
calendar  2004  on  wireless  market segments.  The Company's technology will be
marketed  to manufacturers of such wireless devices as cellular phones, portable
phones,  paging  communicators,  satellite  communications,  global  positioning
systems  (GPS) and wireless based networks. The Company's GPS/LEO antenna is for
use  in  mobile  asset  tracking  and  fleet management, utilizing GPS satellite
tracking  and  low  earth  orbit (LEO) satellite data communications to trucking
fleets,  heavy  equipment,  marine  vessels,  railway cars, shipping containers,
transit  vehicles,  all  via satellite interface communications.  Presently, the
Company  is  focusing  all  of  its resources on the researching, developing and
commercializing  its  Plastenna  and  Electriplast  technologies.


                                        1
<PAGE>
Plastenna

     The  Company  has  developed  and  prototyped a new antenna technology. The
pioneering aspect of the Plastenna technology is that it opens the doors to vast
new  horizons  in antenna design and manufacturing processes. The combination of
the  Company's  proprietary  recipe  of conductive materials, and a selection of
resins  from  various resin suppliers results in a covert moldable antenna, that
can  become  part  of  the  shell  or case of any wireless device, be it phones,
radios, or even body parts of vehicles, or new designs for conventional antennas
as  we  know  them  today.  Our research indicates that the Plastenna technology
vastly  improves  design  flexibility,  increases  signal  performance,  reduces
manufacturing  costs,  and  shows  a  marked  reduction  in  power  consumption.

GPS/LEOS Antenna

     Integral  has  recently finalized the development of a "ruggedized" GPS/LEO
antenna,  measuring only 13.25 inches by 9.90 inches, and .870 inches in height.
The  term  "ruggedized" is used to describe the durability of this antenna, that
is  to  say  it  can withstand the elements and yet endure significant shock and
vibration  effects.  This  antenna is for use in mobile asset tracking and fleet
management,  utilizing  GPS  satellite  tracking  and  LEO  satellite  data
communications  to  trucking  fleets,  heavy  equipment, marine vessels, railway
cars,  shipping  containers,  transit  vehicles,  all  via  satellite  interface
communications.

     Integral continues to advance to the next stage of the commercialization of
its  proprietary  antenna  technologies.  The  Company's  Plastenna  and GPS/LEO
antenna  technologies  are  currently undergoing pilot projects with a number of
wireless  companies  around  the  world.

Flat  Panel  Antennas

     The Company has also been developing several new flat panel antenna designs
for  use  in  different  wireless  technology  markets.

Electriplast

     The Company has recently developed a new family of innovative applications,
deemed  "Electriplast",  based  upon  the  Company's  extensive  research  and
development  of  its  Plastenna  technology.  Electriplast is the utilization of
Integral's proprietary recipe of conductive materials, combined with a selection
of  resins  from  various  resin  suppliers  to  conduct electricity in multiple
applications.

Patents  on  Antenna  Technologies
----------------------------------

     Integral  has completed a patent review of the antenna technologies and has
filed  33  U.S.  patent  applications,  26  of  which  are currently provisional
patents,  four  are  pending  final  approval,  and  three have been granted. No
assurances  can be given that all patent applications will be approved; however,
to the extent that patents are not granted, Integral will continue to attempt to
commercialize  these  technologies without the protection of patents. As patents
are  issued,  Integral  will  have  the  exclusive  right to use in the U.S. the
antenna  design(s)  described  in each issued patent for the 18-year life of the
patent.

     The  Company's intellectual property portfolio consists of over eight years
of  accumulated  research  and  design  knowledge  and trade secrets relating to
antenna  design  &  components  as  well as proprietary manufacturing processes.

Product  Manufacturing  and  Distribution
-----------------------------------------

     The  Company  is  not in the manufacturing business.  The Company relies on
third-party  manufacturing  companies  to  manufacture  antenna  products.

     The  Company's  antenna  products  will not be sold directly to the general
public,  but rather to businesses and manufacturers who will use the antennas in
their  products.


                                        2
<PAGE>
Barriers  to  Entry  into  Market  Segment
------------------------------------------

     In  the  antenna  market, Integral will be competing with other established
antenna  providers that are much larger and better capitalized than Integral. In
order  to  compete,  management  believes  that  Integral  must  demonstrate  to
potential  users that its antenna products have an advantage over other antennas
on  the  market  in  terms  of  performance  and  cost.


EMPLOYEES
---------

     Integral  and  its  subsidiaries  currently employ a total of 5 people on a
full-time  basis. Research and development activities are conducted primarily by
two  employees.  However,  Integral  also  relies  on  the  expertise of several
technical  advisors  who are consulted as needed on a part-time, contract basis.


ITEM  2.  DESCRIPTION  OF  PROPERTY.
------------------------------------

     Neither  the  Company  nor  its  subsidiaries  own  any real property.  The
Company  and  its  subsidiaries lease office space in Bellingham, Washington and
Vancouver,  B.C.,  Canada.


ITEM  3.  LEGAL  PROCEEDINGS.
-----------------------------

In  August  2003, the Company settled all claims by a former employee, Joffre J.
Rolland  Jr.,  and his wife Robyn ("Rollands").  Pursuant to the settlement, the
Company  paid  the  Rollands $10,000 and issued them 37,500 shares of restricted
common  stock,  and  the  Rollands provided a full release of any and all claims
against  Integral.  The  Company also agreed to amend US patent number 6,320,548
B1  ("Dual-Disk  Antenna")  and  US  patent number 6,329,950 B1 ("Planar Antenna
Comprising  Two  Joined  Conducting Regions With Coax") to add Mr. Rolland as an
inventor,  and  agreed  that  Mr.  Rolland  will  be  entitled to receive future
royalties  of  1% on any sales of products covered by US patent number 6,320,548
B1 and US patent number 6,329,950 B1.  The antenna technologies covered by these
patents  have never been produced, marketed or sold by the Company.  The Company
has  no present intention of using these patents, and has no obligation to do so
under  the  terms  of  the  settlement.

In  April  2003,  James  E.  Smith, a shareholder and co-founder of the Company,
filed  suit  against  the Company and its transfer agent in the Circuit Court of
Monongalia  County,  West  Virginia.  The  Complaint alleges breach of contract,
negligence  and  fraud claims, and alleges damages in excess of $1 million.  Mr.
Smith  is  the holder of approximately 1.8 million shares of common stock and is
also  attempting  to  force  the  removal  of the transfer restrictions on these
shares.  The Company was successful in having the case moved to federal court in
the U.S. District Court for the Northern District of West Virginia.  The Company
filed  an  Answer  denying the claims, and filed Counterclaims against Mr. Smith
for  the  following  claims  for  relief: (1) Intentional Misrepresentation; (2)
Breach  of  Contract;  (3)  Negligent  Misrepresentation; and (4) Rescission and
Restitution.  The  case  is  scheduled  to  go  to  trial  in  July  2004.


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

     No  matters  were submitted to a vote of security holders during the fourth
quarter  of  the  fiscal  year  ended  June  30,  2003.

                                        3
<PAGE>
                                     PART II

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

(a)  Market  Information

     There  is a limited public market for the common stock of the Company.  The
Company's common stock is quoted on the NASD OTC Bulletin Board under the symbol
"ITKG."

     The following table sets forth the range of high and low bid quotations for
the  Company's  common  stock  on the OTC Bulletin Board for each quarter of the
fiscal  years  ended  June  30,  2002  and  2003.

<TABLE>
<CAPTION>
          Quarter Ended            Low Bid        High Bid
          ------------------       --------       ---------
<S>                                <C>            <C>
          September 30, 2001       $   0.32       $    0.90
          December 31, 2001        $   0.48       $    1.96
          March 31, 2002           $   1.05       $    1.84
          June 30, 2002            $   0.77       $    1.34

          September 30, 2002       $   0.66       $    1.06
          December 31, 2002        $   0.49       $    0.88
          March 31, 2003           $   0.68       $    1.26
          June 30, 2003            $   0.72       $    1.05
</TABLE>

     The  source  of  this  information  is  the  OTC  Bulletin  Board and other
quotation  services.  The quotations reflect inter-dealer prices, without retail
markup,  markdown  or  commission  and  may  not  represent actual transactions.

(b)   Holders

     As  of September 24, 2003 there were approximately 177 holders of record of
the  Company's  common stock (this number does not include beneficial owners who
hold  shares  at  broker/dealers  in "street-name".  As of August 6, 2003, there
were  4,233  "street-name"  holders).

(c)  Dividends

     To  date,  the  Company  has not paid any dividends on its common stock and
does  not  expect  to  declare  or pay any dividends on such common stock in the
foreseeable  future.  Payment  of  any  dividends  will be dependent upon future
earnings,  if  any, the financial condition of the Company, and other factors as
deemed  relevant  by  the  Company's  Board  of  Directors.

(d)  Recent  Sales  of  Unregistered  Securities

     Set  forth  below  is  information  regarding  the  issuance  and  sales of
securities  of  the  Company  without  registration within the past three fiscal
years.

     (a)  In  July 1999, the Company issued 50,000 shares of its common stock to
     one  person  for  consulting  services  rendered  to the Company which were
     valued at $13,000. This transaction did not involve any public offering, no
     sales  commissions  were  paid  and a restrictive legend was placed on each
     certificate  evidencing  the  shares. The Company believes this transaction
     was  exempt  from  registration  pursuant to Section 4(2) of the Securities
     Act.

     (b)  In  September  1999, the Company issued an aggregate 664,410 shares of
     its Series A Convertible Preferred Stock ("Series A Stock") to its officers
     and  directors.  William  S.  Robinson  received 175,000 shares of Series A
     Stock  in  lieu  of $175,000 in accrued salaries through September 30, 1999
     and 267,197 shares of Series A Stock as repayment of $267,197 in loans made
     to  the  Company.  William  A.  Ince


                                        4
<PAGE>
     received  175,000  shares  of Series A Stock in lieu of $175,000 in accrued
     salaries  through September 30, 1999 and 47,213 shares of Series A Stock in
     repayment  of  $47,213  in  loans made to the Company. Messrs. Robinson and
     Ince  as  officers  and  directors  of the Company are therefore considered
     accredited investors under applicable securities laws. This transaction did
     not  involve  any  public  offering,  no  sales commissions were paid and a
     restrictive  legend  was  placed on each certificate evidencing the shares.
     The Company believes this transaction was exempt from registration pursuant
     to  Section  4(2)  of  the  Securities  Act.

     (c)  In  November 1999, the Company issued a total of 405,000 shares of its
     common  stock  to  members  of its employee benefit and consulting services
     plan  who  exercised,  in July and September 1999, their options previously
     granted  under  the  plan.  The  exercise price of the issued shares ranged
     between  $.15 and $.20 per share. One person paid the exercise price in the
     form of services rendered which was valued at $11,250 and the other persons
     paid  the  exercise  price in cash in an aggregate amount of $65,750. These
     transactions  did  not  involve  any  public  offering, the securities were
     issued  under  a  plan  structured  in  compliance  with  Rule  701  of the
     Securities Act, no sales commissions were paid and a restrictive legend was
     placed on each certificate evidencing the shares. The Company believes that
     the  transaction  was  exempt from registration pursuant to Rule 701 of the
     Securities  Act.

     (d)  In February 2000, the Company issued 50,000 shares of its common stock
     pursuant  to  its  employee  benefit  and  consulting  services plan to one
     person.  The exercise price of the issued shares was $.15 per share and the
     exercise price was paid in cash. The transaction did not involve any public
     offering,  the securities were issued under a plan structured in compliance
     with  Rule  701 of the Securities Act, no sales commissions were paid and a
     restrictive  legend  was  placed on each certificate evidencing the shares.
     The  Company  believes  that  the  transaction was exempt from registration
     pursuant  to  Rule  701  of  the  Securities  Act.

     (e) In February 2000, the Company issued 200,000 shares of its common stock
     pursuant  to  its  employee  benefit  and  consulting  services plan to one
     person.  The exercise price of the issued shares was $.20 per share and the
     exercise price was paid in cash. The transaction did not involve any public
     offering,  the securities were issued under a plan structured in compliance
     with  Rule  701 of the Securities Act, no sales commissions were paid and a
     restrictive  legend  was  placed on each certificate evidencing the shares.
     The  Company  believes  that  the  transaction was exempt from registration
     pursuant  to  Rule  701  of  the  Securities  Act.

     (f)  In  March  2000,  the Company issued 87,500 shares of its common stock
     pursuant  to  its  employee  benefit  and  consulting  services plan to one
     person.  The exercise price of the issued shares was $.23 per share and the
     exercise  price  was  paid  in  the form of services rendered and valued at
     $20,125.  The  transaction  did  not  involve  any  public  offering,  the
     securities  were issued under a plan structured in compliance with Rule 701
     of  the  Securities  Act,  no sales commissions were paid and a restrictive
     legend  was  placed  on each certificate evidencing the shares. The Company
     believes that the transaction was exempt from registration pursuant to Rule
     701  of  the  Securities  Act.

     (g)  In  March  2000,  the  Company  completed  a private placement with 10
     investors  and  sold  2,650,000  shares of its common stock and warrants in
     order to purchase 1,325,000 shares of its common stock at an exercise price
     of $1.80 per share. Aggregate proceeds were $3,976,325. The transaction did
     not  involve  any  public  offering,  no  sales commissions were paid and a
     restrictive  legend  was  placed on each certificate evidencing the shares.
     The  Company  believes  that  the  transaction was exempt from registration
     pursuant to Section 4(2) and Section 4(6) of the Securities Act and/or Rule
     506  of  Regulation  D.

     (h)  In  April  2000, the Company issued 287,500 shares of its common stock
     pursuant  to  its  employee  benefit  and  consulting  services plan to one
     person.  The  exercise price of the shares ranged between $.15 and $.40 per
     share  and the exercise price was paid in the form of services rendered and
     valued at $65,000. The transaction did not involve any public offering, the
     securities  were issued under a plan structured in compliance with Rule 701
     of  the  Securities  Act,  no sales commissions were paid and a restrictive
     legend  was  placed  on each certificate evidencing the shares. The Company
     believes that the transaction was exempt from registration pursuant to Rule
     701  of  the  Securities  Act.


                                        5
<PAGE>
     (i)  In  April  2000,  the Company issued 80,000 shares of its common stock
     pursuant  to  its  employee  benefit  and  consulting  services plan to one
     person.  The  exercise  price  of  the  shares  was  $.20 per share and the
     exercise price was paid in cash. The transaction did not involve any public
     offering,  the securities were issued under a plan structured in compliance
     with  Rule  701 of the Securities Act, no sales commissions were paid and a
     restrictive  legend  was  placed on each certificate evidencing the shares.
     The  Company  believes  that  the  transaction was exempt from registration
     pursuant  to  Rule  701  of  the  Securities  Act.

     (j)  In  May  2000,  the Company entered into an Investment Agreement and a
     Registration  Rights  Agreement with Swartz Private Equity, LLC ("Swartz").
     Pursuant  to the terms of the Investment Agreement, the Company may, in its
     sole  discretion  and  subject  to  certain restrictions, periodically sell
     ('put")  shares of common stock to Swartz for up to $25,000,000. In partial
     consideration  of the Investment Agreement, the Company issued a Commitment
     Warrants  to  Swartz  to  purchase  495,000 shares of Common Stock for five
     years,  at  an  adjusted  exercise  price  of  $.50  per share. The Company
     believes  that  these transactions are exempt from registration pursuant to
     Section  4(2)  of  the  Securities  Act  and/or  Rule  506 of Regulation D.
     Following  is  a  summary  of  completed  put  transactions  to  date:

<TABLE>
<CAPTION>
                             Price Per     Gross                       Warrant
     Put Date    No. Shares    Share      Proceeds   No. Warrants   Exercise Price
                                                                    (as adjusted)
     ------------------------------------------------------------------------------

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

     09-28-2000      81,885  $     1.25  $  102,356         8,189  $         0.5126

     09-26-2001      67,635  $     0.45  $   30,436         6,764  $          0.561

     12-12-2001     547,865  $     1.34  $  734,139        54,787  $         1.0406

     01-23-2002      51,000  $     1.30  $   66,300         5,100  $          0.814

     02-28-2002     109,475  $     1.13  $  123,707        10,948  $          1.188

     TOTALS         857,860              $1,056,938        85,788
</TABLE>

     (k)  In  June  2000,  the  Company  issued  135,000  shares pursuant to its
     employee  benefit  and  consulting  services  plan  to  two  individuals in
     consideration  for  two  one  year  promissory notes bearing an 8% interest
     rate.  The exercise price was $.20 per share. One promissory note is in the
     amount  of  $20,000  and  the  other  is  in  the  amount  of $7,500. These
     transactions  did  not  involve  any  public  offering, the securities were
     issued  under  a  plan  structured  in  compliance  with  Rule  701  of the
     Securities Act, no sales commissions were paid and a restrictive legend was
     placed on each certificate evidencing the shares. The Company believes that
     transactions  were  exempt  from  registration  pursuant to Rule 701 of the
     Securities  Act.

     (l)  On  December  28, 2000, the Company issued 20,000 shares of its common
     stock  to  one  person  upon  exercise  of options pursuant to the Employee
     Benefit  and  Consulting Services Compensation Plan. The Company issued the
     shares in consideration for the payment of $3,000. This transaction did not
     involve  any  public  offering,  the  securities  were  issued under a plan
     structured  in  compliance  with  Rule  701 of the Securities Act, no sales
     commissions  were  paid,  and  a  restrictive  legend  was  placed  on each
     certificate  evidencing  the  shares.  The  Company  believes  that  the
     transaction  was  exempt  from  registration  pursuant  to  Rule 701 of the
     Securities  Act.

     (m)  In  January 2001, the Company issued an aggregate of 517,000 shares of
     its  common  stock  to six persons upon exercise of options pursuant to the
     Employee Benefit and Consulting Services Compensation Plan. The options had
     various exercise prices, ranging from $0.15 to $1.16 per share. The Company
     issued  the  shares  in  consideration  for  an aggregate of $91,500. These
     transactions  did  not  involve  any  public  offering, the securities were
     issued  under  a  plan  structured  in  compliance  with  Rule  701  of the
     Securities  Act,  no  sales commissions were paid, and a restrictive legend
     was  placed  on  each  certificate  evidencing  the


                                        6
<PAGE>
     shares.  The  Company  believes  that  each  transaction  was  exempt  from
     registration  pursuant  to  Rule  701  of  the  Securities  Act.

     (n) In April 2001, the Company issued 100,000 shares of its common stock to
     one  person  upon  exercise of options pursuant to the Employee Benefit and
     Consulting Services Compensation Plan. The exercise price of the shares was
     $.40  per  share,  and  the exercise price was paid in the form of services
     rendered  (valued  at  $40,000). The transaction did not involve any public
     offering,  the securities were issued under a plan structured in compliance
     with  Rule 701 of the Securities Act, no sales commissions were paid, and a
     restrictive  legend  was  placed on each certificate evidencing the shares.
     Integral  believes  that  the  transaction  was  exempt  from  registration
     pursuant  to  Rule  701  of  the  Securities  Act.

     (o)  In  August  2001, the Company issued an aggregate of 858,500 shares of
     its  common  stock  to  3 persons (including two officers) upon exercise of
     options  pursuant  to  the  Employee  Benefit  and  Consulting  Services
     Compensation  Plan.  The  options had various exercise prices, ranging from
     $0.15 to $.33 per share. The Company issued the shares in consideration for
     an  aggregate  of  $52,305 in cash and $124,200 in lieu of accrued salaries
     payable.  These  transactions  did  not  involve  any  public offering, the
     securities  were issued under a plan structured in compliance with Rule 701
     of  the  Securities  Act, no sales commissions were paid, and a restrictive
     legend  was  placed  on each certificate evidencing the shares. The Company
     believes  that  each  transaction  was exempt from registration pursuant to
     Rule  701  of  the  Securities  Act.

     (p) In September 2001, the Company issued an aggregate of 325,000 shares to
     eight  persons  pursuant  to  the exercise of warrants previously issued in
     connection  with  a private placement in March 2000, for aggregate proceeds
     of  $130,000.  In  August 2001, the exercise price of the warrants had been
     temporarily  reduced  from  $1.80 to $.40 per share through September 2001.
     The  transaction  did not involve any public offering, no sales commissions
     were  paid  and  a  restrictive  legend  was  placed  on  each  certificate
     evidencing the shares. The Company believes that the transaction was exempt
     from  registration  pursuant  to  Section  4(2)  and  Section  4(6)  of the
     Securities  Act  and/or  Rule  506  of  Regulation  D.

     (q)  In January 2002, the Company issued 100,000 shares of its common stock
     pursuant  to  its  employee  benefit  and  consulting  services plan to one
     person.  The  exercise  price  of  the  shares  was  $.40 per share and the
     exercise price was paid in cash. The transaction did not involve any public
     offering,  the securities were issued under a plan structured in compliance
     with  Rule  701 of the Securities Act, no sales commissions were paid and a
     restrictive  legend  was  placed on each certificate evidencing the shares.
     The  Company  believes  that  the  transaction was exempt from registration
     pursuant  to  Rule  701  of  the  Securities  Act.

     (r)  In  January 2002, the Company issued an aggregate of 450,000 shares of
     common  stock  to  two  employees  in  consideration  of the execution of a
     "Proprietary,  Non-Disclosure  and  Non-Solicitation  Agreement"  by  each
     person.  A restrictive legend was placed on each certificate evidencing the
     shares.  The  Company  believes  that  the  transactions  were  exempt from
     registration  pursuant  to  Section  4(2) of the Securities Act of 1933, as
     amended,  and/or  Rule  506  of  Regulation  D.

     (s) In October 2002, the Company issued 144,793 shares of restricted common
     stock to Swartz Private Equity, LLC ("Swartz"), pursuant to an agreement to
     settle  a  non-use  fee  of  $104,541.84  that  had accrued pursuant to the
     Investment  Agreement  between  the Company and Swartz. The transaction did
     not  involve  any  public  offering,  no  sales commissions were paid and a
     restrictive  legend  was  placed on each certificate evidencing the shares.
     The  Company  believes  that  the  transaction was exempt from registration
     pursuant to Section 4(2) and Section 4(6) of the Securities Act and/or Rule
     506  of  Regulation  D.

     (t)  In November 2002, the Company completed a private placement with eight
     investors  and  sold 1,684,000 shares of its common stock at $.50 per share
     and  warrants  to  purchase  842,000  shares of its common stock within two
     years  at  an exercise price of $.75 per share. Aggregate proceeds from the
     sale of the common stock was $842,000. In connection with the offering, the
     Company  agreed  to  use  its best efforts to register the shares of common
     stock  (including  the  shares  underlying  the warrants) for resale by the
     investors  within 180 days after the close of the offering. The transaction
     did  not  involve any public offering, no sales commissions were paid and a
     restrictive  legend  was  placed on each certificate evidencing the shares.
     The


                                        7
<PAGE>
     Company believes that the transaction was exempt from registration pursuant
     to  Section  4(2) and Section 4(6) of the Securities Act and/or Rule 506 of
     Regulation  D.

     (u)  In  February  2003,  Swartz Private Equity, LLC ("Swartz") exercised a
     portion  of  an  outstanding  warrant  for $27,500 ($.50 per share) and the
     Company  issued  to  Swartz  55,000  shares of restricted common stock. The
     transaction  did not involve any public offering, no sales commissions were
     paid and a restrictive legend was placed on each certificate evidencing the
     shares.  The  Company  believes  that  the  transaction  was  exempt  from
     registration  pursuant  to  Section 4(2) and Section 4(6) of the Securities
     Act  and/or  Rule  506  of  Regulation  D.

     (v)  In  May  2003  issued 200,000 shares of restricted common stock to The
     Investor  Relations  Group,  Inc.  pursuant to a one-year service agreement
     dated  February  27,  2003.  The  transaction  did  not  involve any public
     offering,  no  sales  commissions  were  paid  and a restrictive legend was
     placed on each certificate evidencing the shares. The Company believes that
     the  transaction  was exempt from registration pursuant to Section 4(2) and
     Section  4(6)  of  the  Securities  Act  and/or  Rule  506 of Regulation D.

     (w)  In  August  2003,  the  Company completed a private placement with ten
     investors and sold 898,336 shares of its common stock at $.75 per share and
     warrants to purchase 449,168 shares of its common stock within two years at
     an  exercise  price of $1.00 per share. Aggregate proceeds from the sale of
     the common stock was $673,752. In connection with the offering, the Company
     agreed  to  use  its  best  efforts  to register the shares of common stock
     (including  the shares underlying the warrants) for resale by the investors
     within  180  days  after the close of the offering. The transaction did not
     involve  any  public  offering,  no  sales  commissions  were  paid  and  a
     restrictive  legend  was  placed on each certificate evidencing the shares.
     The  Company  believes  that  the  transaction was exempt from registration
     pursuant to Section 4(2) and Section 4(6) of the Securities Act and/or Rule
     506  of  Regulation  D.

     (x)  In  September  2003,  the  Company  issued 37,500 shares of restricted
     common stock in connection with a settlement of a legal dispute with Joffre
     J. Rolland, Jr. and Robyn Rolland, pursuant to a mutual release executed in
     August  2003. The transaction did not involve any public offering, no sales
     commissions  were  paid  and  a  restrictive  legend  was  placed  on  each
     certificate  evidencing  the  shares.  The  Company  believes  that  the
     transaction  was  exempt  from registration pursuant to Section 4(2) of the
     Securities  Act  and/or  Rule  506  of  Regulation  D.


ITEM 2.  PLAN OF OPERATION.
---------------------------

     To  date  the  Company  has  recorded nominal revenues from operations. The
Company is still considered a development stage company for accounting purposes.
From  inception  on  February  12,  1996  through June 30, 2003, the Company has
accrued  an  accumulated  deficit  of  approximately  $14.6  million.

     As  a  result  of  the  commercial  interest  in  the  Company's  antenna
technologies,  the  Company  presently intends to focus substantially all of its
resources  on  the  commercialization  and  sales  of Plastenna and Electriplast
technologies.  As  a  result,  the  Company  will  not  be  devoting  any of its
resources  on  the  further  research,  development and commercialization of the
other  technologies  in  which  it  has  an  interest.

     The  Company's  business  strategy  focuses  on leveraging its intellectual
property  rights  on  its antenna technologies, its strengths in antenna design,
material  innovation,  and  an  understanding  of  the  wireless  marketplace.

     The  Company  is  not  in the manufacturing business and does not expect to
make  any capital purchases of a manufacturing plant or significant equipment in
the  next  twelve months.  The Company will be relying on contract manufacturers
to  produce  the  antenna  products.

     The  Company  is  focusing  its  marketing  efforts  through  to the end of
calendar  2004  on  wireless  market segments.  The Company's technology will be
marketed  to manufacturers of such wireless devices as cellular phones, portable
phones,  paging  communicators,  satellite  communications,  global  positioning
systems  (GPS)  and


                                        8
<PAGE>
wireless  based  networks.  The  Company's  GPS/LEO antenna is for use in mobile
asset  tracking  and  fleet management, utilizing GPS satellite tracking and low
earth  orbit  (LEO)  satellite  data  communications  to  trucking fleets, heavy
equipment,  marine vessels, railway cars, shipping containers, transit vehicles,
all  via satellite interface communications.  Presently, the Company is focusing
all  of  its  resources  on  the researching, developing and commercializing its
Plastenna  and  Electriplast  technologies.

     The  Company  anticipates  spending  approximately  $250,000  over the next
twelve  months on ongoing research and development of the different applications
and  uses  of  its  antenna  technologies.

     During  the  next twelve months, the Company does not anticipate increasing
its  staff.

     To  date,  the Company has relied on loans from management and management's
ability to raise capital through debt and equity private placement financings to
fund  its  operations.  During  the  past  two  fiscal  years,  the  majority of
financing  was  completed  pursuant  to an equity line of credit with the Swartz
Private  Equity,  LLC  ("Swartz").  In  May  2000,  the  Company entered into an
Investment  Agreement  with  Swartz.  Pursuant  to  the  terms of the Investment
Agreement,  the  Company  may,  in  its  sole  discretion and subject to certain
restrictions,  periodically sell ("Put") shares of common stock to Swartz for up
to  $25,000,000.  Pursuant  to  the  terms  of the Investment Agreement, the Put
share  price  will  be  determined  and paid to the Company twenty business days
after  the date of the Put. The Company received net proceeds of $102,356 from a
Put  of  81,885 shares to Swartz during the fiscal year ended June 30, 2001. The
Company  received  net proceeds of $954,582 from Puts totaling 775,975 shares to
Swartz during the year ended June 30, 2002.  The Investment Agreement terminated
in  May  2003.

     In  November  2002,  the  Company  completed a private placement with eight
investors  and  sold  1,684,000 shares of its common stock at $.50 per share and
warrants  to  purchase 842,000 shares of its common stock within two years at an
exercise  price  of  $.75  per  share.  Aggregate  proceeds from the sale of the
common  stock was $842,000.  In connection with the offering, the Company agreed
to  use  its  best efforts to register the shares of common stock (including the
shares  underlying  the  warrants)  for  resale by the investors within 180 days
after  the  close  of  the offering.  The transaction did not involve any public
offering,  no sales commissions were paid and a restrictive legend was placed on
each  certificate  evidencing  the  shares.

     In  August  2003,  the  Company  completed  a  private  placement  with ten
investors  and  sold  898,336  shares  of its common stock at $.75 per share and
warrants  to  purchase 449,168 shares of its common stock within two years at an
exercise  price  of  $1.00  per  share.  Aggregate proceeds from the sale of the
common  stock was $673,752.  In connection with the offering, the Company agreed
to  use  its  best efforts to register the shares of common stock (including the
shares  underlying  the  warrants)  for  resale by the investors within 180 days
after  the  close  of  the offering.  The transaction did not involve any public
offering,  no sales commissions were paid and a restrictive legend was placed on
each  certificate  evidencing  the  shares.

     The  Company  does  not currently have adequate funds available to fund its
operations  over  the next twelve months.  If the Company does not earn adequate
revenues  to  sufficiently  fund operations during this time period, the Company
will  attempt to raise capital through the sale of its securities.  There can be
no  assurance,  however, that market conditions will permit the Company to raise
sufficient  funds  or that additional financing will be available when needed or
on  terms  acceptable  to  the  Company.


ITEM  7.  FINANCIAL  STATEMENTS  AND  SUPPLEMENTARY  DATA.
---------------------------------------------------------

     The  information  required  by Item 7 and an index thereto commences on the
index  to  the  financial  statements,  which  page  follows  this  page.


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

     None.

                                        9
<PAGE>



<TABLE>
<CAPTION>
INTEGRAL TECHNOLOGIES, INC.
(A DEVELOPMENT STAGE COMPANY)

CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2003, 2002 AND 2001
(U.S. DOLLARS)



INDEX                                                                   PAGE
-----                                                                   ----
<S>                                                                     <C>


REPORT OF INDEPENDENT ACCOUNTANTS                                        F-1

FINANCIAL STATEMENTS

Consolidated Balance Sheets                                              F-2

Consolidated Statements of Operations                                    F-3

Consolidated Statements of Stockholders' Equity (Deficit)            F-4-F-7

Consolidated Statements of Cash Flows                                    F-8

Notes to Consolidated Financial Statements                          F-9-F-25
</TABLE>


<PAGE>
                        REPORT OF INDEPENDENT ACCOUNTANTS


TO  THE  DIRECTORS  AND  STOCKHOLDERS  OF
INTEGRAL  TECHNOLOGIES,  INC.
(A  DEVELOPMENT  STAGE  COMPANY)

We  have  audited  the  accompanying  consolidated  balance  sheets  of Integral
Technologies,  Inc.  (A  Development Stage Company) as of June 30, 2003 and 2002
and  the  related  consolidated  statements  of operations, stockholders' equity
(deficit)  and  cash  flows  for each of the years ended June 30, 2003, 2002 and
2001  and  the  cumulative  totals  for the development stage of operations from
February 12, 1996 (inception) through June 30, 2003.  These financial statements
are  the  responsibility  of the Company's management.  Our responsibility is to
express  an  opinion  on  these  financial  statements based on our audits.  The
financial  statements  of  Integral  Technologies,  Inc.  from February 12, 1996
(inception)  through  June  30, 1996 were audited by other auditors whose report
dated  November  20, 1996, expressed an unqualified opinion on those statements.
Our opinion insofar as it relates to the cumulative totals for development stage
operations  from  February  12, 1996 (inception) through June 30, 1996, is based
solely  on  the  report  of  the  other  auditors.

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

In  our  opinion, based on our audit and the report of the other auditors, these
consolidated  financial statements present fairly, in all material respects, the
consolidated  financial position of the Company as at June 30, 2003 and 2002 and
the  consolidated  results  of its operations and its cash flows for each of the
years  ended  June  30,  2003,  2002  and 2001 and the cumulative totals for the
development  stage of operations from February 12, 1996 (inception) through June
30,  2003  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 note 2 to the
consolidated  financial  statements,  the  Company has minimal capital resources
available  and  has  incurred  substantial losses to June 30, 2003.  The Company
must  obtain  additional  financing  to  meet its cash flow requirements.  These
matters  raise  substantial  doubt  about the Company's ability to continue as a
going  concern.  Management's  plan in regard to these matters is also described
in  note  2.  These financial statements do not include any adjustments that may
result  from  the  outcome  of  these  uncertainties.


/s/ Pannell Kerr Forster

Chartered  Accountants

Vancouver,  Canada
September  3,  2003


                                       F-1
<PAGE>
<TABLE>
<CAPTION>
INTEGRAL TECHNOLOGIES, INC.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED BALANCE SHEETS
JUNE 30
(U.S. DOLLARS)

=================================================================================
                                                         2003           2002
---------------------------------------------------------------------------------
<S>                                                  <C>            <C>
ASSETS

CURRENT
  Cash                                               $    174,210   $    267,795
  Accounts receivable                                       1,141         15,767
  Prepaid expenses                                         11,844         15,093
---------------------------------------------------------------------------------
TOTAL CURRENT ASSETS                                      187,195        298,655
PROPERTY AND EQUIPMENT (note 4)                            54,282         78,583
INVESTMENTS (note 5)                                            1              1
---------------------------------------------------------------------------------

TOTAL ASSETS                                         $    241,478   $    377,239
=================================================================================

LIABILITIES

CURRENT
  Accounts payable and accruals (note 8)             $    472,254   $    657,107
  Due to West Virginia University Research
    Corporation (note 10(a))                              397,296        397,296
  Customer deposits                                             0         13,232
---------------------------------------------------------------------------------

TOTAL CURRENT LIABILITIES                                 869,550      1,067,635
---------------------------------------------------------------------------------

CONTINGENCIES (note 10)


STOCKHOLDERS' DEFICIT (note 6)

PREFERRED STOCK AND PAID-IN CAPITAL IN EXCESS
 OF $0.001 PAR VALUE
  20,000,000     Shares authorized
     439,610     (2002 - 439,610) Shares issued
                   and outstanding (note 6(b))            439,610        439,610
COMMON STOCK AND PAID-IN CAPITAL IN EXCESS
 OF $0.001 PAR VALUE
  50,000,000     Shares authorized
  32,923,855     (2002 - 30,787,562) Shares issued
                   and outstanding (note 6(a))         13,335,752     12,116,450
PROMISSORY NOTES RECEIVABLE (note 6(e))                   (66,500)       (66,500)
SHARE SUBSCRIPTIONS                                       211,915              0
OTHER COMPREHENSIVE INCOME                                 46,267         46,267
DEFICIT ACCUMULATED DURING THE DEVELOPMENT STAGE      (14,595,116)   (13,226,223)
---------------------------------------------------------------------------------
TOTAL STOCKHOLDERS' DEFICIT                              (628,072)      (690,396)
---------------------------------------------------------------------------------

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT          $    241,478   $    377,239
=================================================================================
</TABLE>


                                        F-2
See notes to consolidated financial statements.
<PAGE>
<TABLE>
<CAPTION>
INTEGRAL TECHNOLOGIES, INC.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF OPERATIONS
(U.S. DOLLARS)

===============================================================================================
                                                                                  PERIOD FROM
                                                                                 FEBRUARY 12,
                                                                                     1996
                                                                                  (INCEPTION)
                                                 YEARS ENDED JUNE 30,               THROUGH
                                          2003          2002          2001       JUNE 30, 2003
-----------------------------------------------------------------------------------------------
<S>                                   <C>           <C>           <C>           <C>
REVENUE                               $    21,355   $    27,686   $    15,209   $      236,667
COST OF SALES                                   0        13,468         5,360          216,016
-----------------------------------------------------------------------------------------------
                                           21,355        14,218         9,849           20,651
-----------------------------------------------------------------------------------------------
EXPENSES
  Consulting                              445,193       663,795       151,108        2,155,517
  Salaries                                467,093       547,272     1,273,094        3,256,448
  Legal and accounting                    151,651       169,247       390,034        1,176,169
  Travel and entertainment                 93,879       122,898       173,242          743,668
  General and administrative               57,515        97,458       115,428          506,417
  Settlement of lawsuit (note 10(b))       45,250             0             0           45,250
  Rent                                     31,838        34,102        73,578          253,618
  Telephone                                29,892        33,169        45,842          257,300
  Bad debts                                10,753        14,500        48,750           76,571
  Advertising                               9,360        13,348       139,961          271,255
  Bank charges and
    interest, net                           1,498        10,053       (53,971)         107,855
  Research and development                  1,234         8,401       171,756        1,244,755
  Remuneration pursuant to
    proprietary, non-competition
    agreement (note 6(a)(i))                    0       711,000             0          711,000
  Financing fees (note 6(a)(ii))                0       104,542             0          104,542
  Write-down of license
    and operating assets (note 1)               0        48,919     1,382,046        1,855,619
  Interest on beneficial
    conversion feature                          0             0             0          566,456
  Write-off of investments (note 5)             0     1,249,999             0        1,249,999
  Depreciation and
    amortization                           23,032        21,706        99,150          270,104
-----------------------------------------------------------------------------------------------
                                        1,368,188     3,850,409     4,010,018       14,852,543
-----------------------------------------------------------------------------------------------
LOSS BEFORE OTHER INCOME               (1,346,833)   (3,836,191)   (4,000,169)     (14,831,892)
OTHER INCOME
  Cancellation of debt                          0             0             0          602,843
-----------------------------------------------------------------------------------------------

NET LOSS FOR PERIOD                   $(1,346,833)  $(3,836,191)  $(4,000,169)  $  (14,229,049)
===============================================================================================
LOSS PER COMMON SHARE BEFORE
  OTHER INCOME                        $     (0.04)  $     (0.13)  $     (0.15)
OTHER INCOME
  PER COMMON SHARE                           0.00          0.00          0.00
-----------------------------------------------------------------------------------------------

NET LOSS PER COMMON SHARE             $     (0.04)  $     (0.13)  $     (0.15)
===============================================================================================
WEIGHTED AVERAGE NUMBER OF
  COMMON SHARES OUTSTANDING            31,928,310    29,064,780    26,499,533
===============================================================================================
</TABLE>


                                        F-3
See notes to consolidated financial statements.
<PAGE>
<TABLE>
<CAPTION>
INTEGRAL TECHNOLOGIES, INC.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
(U.S. DOLLARS)

==========================================================================================================================
                                            COMMON                PREFERRED
                                           STOCK AND              STOCK AND
                                SHARES      PAID-IN    SHARES OF   PAID-IN
                              OF COMMON     CAPITAL    PREFERRED   CAPITAL    PROMISSORY                        OTHER
                                STOCK      IN EXCESS     STOCK    IN EXCESS      NOTES         SHARE        COMPREHENSIVE
                                ISSUED      OF PAR      ISSUED      OF PAR    RECEIVABLE   SUBSCRIPTIONS       INCOME
--------------------------------------------------------------------------------------------------------------------------
<S>                           <C>         <C>          <C>        <C>         <C>          <C>             <C>
SHARES ISSUED FOR
  Cash                         1,000,000  $   10,000           0  $        0  $         0  $            0  $            0
  Property and equipment
    (to officers
    and directors)             1,500,000      15,000           0           0            0               0               0
  Services (provided by
    officers and directors)    2,000,000      20,000           0           0            0               0               0
  Services                     1,500,000      15,000           0           0            0               0               0
Foreign currency
  Translation                          0           0           0           0            0               0          (1,226)
Net loss for year                      0           0           0           0            0               0               0
--------------------------------------------------------------------------------------------------------------------------
BALANCE, JUNE 30, 1996         6,000,000      60,000           0           0            0               0          (1,226)
SHARES ISSUED FOR
  Cash                         5,086,000     865,514           0           0            0               0               0
  Share issue costs                    0     (48,920)          0           0            0               0               0
  Services                       564,000      63,036           0           0            0               0               0
  Acquisition of subsidiary      100,000     275,000           0           0            0               0               0
Foreign currency
  Translation                          0           0           0           0            0               0          12,601
Net loss for year                      0           0           0           0            0               0               0
--------------------------------------------------------------------------------------------------------------------------
BALANCE, JUNE 30, 1997        11,750,000   1,214,630           0           0            0               0          11,375
SHARES ISSUED FOR
  Cash                           825,396     650,000                       0            0               0               0
  Share issue costs                    0     (78,000)          0           0            0               0               0
Foreign currency
  Translation                          0           0                       0            0               0          24,860
Net loss for year                      0           0           0           0            0               0               0
--------------------------------------------------------------------------------------------------------------------------
BALANCE, JUNE 30, 1998        12,575,396  $1,786,630           0  $        0  $         0  $            0  $       36,235
--------------------------------------------------------------------------------------------------------------------------


==============================================================
                                 DEFICIT
                               ACCUMULATED
                               DURING THE          TOTAL
                               DEVELOPMENT     STOCKHOLDERS'
                                  STAGE      EQUITY (DEFICIT)
--------------------------------------------------------------
<S>                           <C>            <C>
SHARES ISSUED FOR
  Cash                        $          0   $         10,000
  Property and equipment
    (to officers
    and directors)                       0             15,000
  Services (provided by
    officers and directors)              0             20,000
  Services                               0             15,000
Foreign currency
  Translation                            0             (1,226)
Net loss for year                 (344,843)          (344,843)
--------------------------------------------------------------
BALANCE, JUNE 30, 1996            (344,843)          (286,069)
SHARES ISSUED FOR
  Cash                                   0            865,514
  Share issue costs                      0            (48,920)
  Services                               0             63,036
  Acquisition of subsidiary              0            275,000
Foreign currency
  Translation                            0             12,601
Net loss for year                 (822,217)          (822,217)
--------------------------------------------------------------
BALANCE, JUNE 30, 1997          (1,167,060)            58,945
SHARES ISSUED FOR
  Cash                                   0            650,000
  Share issue costs                      0            (78,000)
Foreign currency
  Translation                            0             24,860
Net loss for year                 (937,373)          (937,373)
--------------------------------------------------------------
BALANCE, JUNE 30, 1998        $ (2,104,433)  $       (281,568)
--------------------------------------------------------------
</TABLE>


                                        F-4
See notes to consolidated financial statements.
<PAGE>
<TABLE>
<CAPTION>
INTEGRAL TECHNOLOGIES, INC.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
(U.S. DOLLARS)

=====================================================================================================================
                                                       COMMON                PREFERRED
                                                      STOCK AND              STOCK AND
                                         SHARES OF     PAID-IN    SHARES OF   PAID-IN
                                           COMMON      CAPITAL    PREFERRED   CAPITAL     PROMISSORY
                                           STOCK      IN EXCESS     STOCK    IN EXCESS      NOTES          SHARE
                                           ISSUED      OF PAR      ISSUED      OF PAR     RECEIVABLE   SUBSCRIPTIONS
---------------------------------------------------------------------------------------------------------------------
<S>                                      <C>         <C>          <C>        <C>         <C>           <C>
BALANCE, JUNE 30, 1998                   12,575,396  $1,786,630           0  $        0  $         0   $            0
SHARES ISSUED FOR
  Cash                                      200,000      50,000           0           0            0                0
  Exercise of stock options                 445,000      80,500           0           0            0                0
  Promissory note                         1,683,789     252,568           0           0     (284,068)               0
  Settlement of lawsuit                     150,000      15,000           0           0            0                0
  Services (provided by
    officers and directors)                 666,666     100,000           0           0            0                0
  Share issue costs                               0    (100,500)          0           0            0                0
  Services                                  250,000      50,000           0           0            0                0
  Conversion of convertible debentures    3,869,120     525,813           0           0            0                0
  Acquisition of subsidiary               1,800,000     619,200           0           0            0                0
  Held in escrow                            447,091           0           0           0            0                0
  Stock option benefit                            0      70,600           0           0            0                0
  Beneficial conversion feature                   0     566,456           0           0            0                0
Foreign currency translation                      0           0           0           0            0                0
Net loss for year                                 0           0           0           0            0                0
---------------------------------------------------------------------------------------------------------------------
BALANCE JUNE 30, 1999                    22,087,062   4,016,267           0           0     (284,068)               0
SHARES ISSUED FOR
  Cash on private placement               2,650,000   3,975,000           0           0            0                0
  Exercise of options                     1,245,000     256,700           0           0            0                0
  Release from escrow                             0      75,558           0           0            0                0
  Services                                   50,000      13,000           0           0            0                0
  Settlement of debt                              0           0     664,410     664,410            0                0
Stock option benefit                              0      48,256           0           0            0                0
Promissory note repayment                         0           0           0           0      225,568                0
Foreign currency translation                      0           0           0           0            0                0
Net loss for the year                             0           0           0           0            0                0
---------------------------------------------------------------------------------------------------------------------
BALANCE, JUNE 30, 2000                   26,032,062  $8,384,781     664,410  $  664,410  $   (58,500)  $            0
---------------------------------------------------------------------------------------------------------------------


=========================================================================================
                                                            DEFICIT
                                                          ACCUMULATED
                                             OTHER        DURING THE          TOTAL
                                         COMPREHENSIVE    DEVELOPMENT     STOCKHOLDERS'
                                             INCOME          STAGE      EQUITY (DEFICIT)
-----------------------------------------------------------------------------------------
<S>                                      <C>             <C>            <C>
BALANCE, JUNE 30, 1998                   $       36,235  $ (2,104,433)  $       (281,568)
SHARES ISSUED FOR
  Cash                                                0             0             50,000
  Exercise of stock options                           0             0             80,500
  Promissory note                                     0             0            (31,500)
  Settlement of lawsuit                               0             0             15,000
  Services (provided by
    officers and directors)                           0             0            100,000
  Share issue costs                                   0             0           (100,500)
  Services                                            0             0             50,000
  Conversion of convertible debentures                0             0            525,813
  Acquisition of subsidiary                           0             0            619,200
  Held in escrow                                      0             0                  0
  Stock option benefit                                0             0             70,600
  Beneficial conversion feature                       0             0            566,456
Foreign currency translation                      8,444             0              8,444
Net loss for year                                     0    (1,404,021)        (1,404,021)
-----------------------------------------------------------------------------------------
BALANCE JUNE 30, 1999                            44,679    (3,508,454)           268,424
SHARES ISSUED FOR
  Cash on private placement                           0             0          3,975,000
  Exercise of options                                 0             0            256,700
  Release from escrow                                 0             0             75,558
  Services                                            0             0             13,000
  Settlement of debt                                  0             0            664,410
Stock option benefit                                  0             0             48,256
Promissory note repayment                             0             0            225,568
Foreign currency translation                      1,614             0              1,614
Net loss for the year                                 0    (1,537,402)        (1,537,402)
-----------------------------------------------------------------------------------------
BALANCE, JUNE 30, 2000                   $       46,293  $ (5,045,856)  $      3,991,128
-----------------------------------------------------------------------------------------
</TABLE>


                                        F-5
See notes to consolidated financial statements.
<PAGE>
<TABLE>
<CAPTION>
INTEGRAL TECHNOLOGIES, INC.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
(U.S. DOLLARS)

=================================================================================================================================
                                               COMMON                  PREFERRED
                                             STOCK AND                 STOCK AND
                                  SHARES      PAID-IN     SHARES OF     PAID-IN
                                OF COMMON     CAPITAL     PREFERRED     CAPITAL     PROMISSORY                         OTHER
                                  STOCK      IN EXCESS      STOCK      IN EXCESS      NOTES           SHARE        COMPREHENSIVE
                                  ISSUED       OF PAR       ISSUED      OF PAR      RECEIVABLE    SUBSCRIPTIONS       INCOME
---------------------------------------------------------------------------------------------------------------------------------
<S>                             <C>         <C>           <C>         <C>          <C>           <C>              <C>
BALANCE, JUNE 30, 2000          26,032,062  $ 8,384,781     664,410   $  664,410   $   (58,500)  $            0   $       46,293
SHARES ISSUED FOR
  Private placement                 81,885      112,480           0            0             0                0                0
  Exercise of options              517,000       91,515           0            0             0                0                0
  For services                     100,000       40,000           0            0             0                0                0
  Held in escrow
    (note 6(a)(ii)(b)(i))          218,115            0           0            0             0                0                0
Stock option benefit                     0      272,207           0            0             0                0                0
Dividends on preferred shares            0            0           0            0             0                0                0
Share subscriptions                      0            0           0            0             0           50,000                0
Redeemed shares                          0            0    (100,000)    (100,000)            0                0                0
Foreign currency translation             0            0           0            0             0                0              (26)
Net loss for the year                    0            0           0            0             0                0                0
---------------------------------------------------------------------------------------------------------------------------------
BALANCE, JUNE 30, 2001          26,949,062    8,900,983     564,410      564,410       (58,500)          50,000           46,267
SHARES ISSUED FOR
  Proprietary non-competition
    agreement (note 6(a)(i))       450,000      711,000           0            0             0                0                0
  Held in escrow                   700,000            0           0            0             0                0                0
  Exercise of options            2,263,500      971,200           0            0       (15,000)         (10,000)               0
  Exercise of warrants             325,000      130,000           0            0             0                0                0
  Subscriptions                    100,000       40,000           0            0             0          (40,000)               0
Stock option compensation                0      415,685           0            0             0                0                0
Shares released from escrow              0      954,582           0            0             0                0                0
Dividends on preferred shares            0            0           0            0             0                0                0
Redeemed shares                          0            0    (124,800)    (124,800)            0                0                0
Write-off of promissory
  note receivable                        0       (7,000)          0            0         7,000                0                0
Net loss for the year                    0            0           0            0             0                0                0
---------------------------------------------------------------------------------------------------------------------------------
BALANCE, JUNE 30, 2002          30,787,562  $12,116,450     439,610   $  439,610   $   (66,500)  $            0   $       46,267
---------------------------------------------------------------------------------------------------------------------------------


================================================================
                                   DEFICIT
                                 ACCUMULATED
                                 DURING THE          TOTAL
                                 DEVELOPMENT     STOCKHOLDERS'
                                    STAGE      EQUITY (DEFICIT)
----------------------------------------------------------------
<S>                             <C>            <C>
BALANCE, JUNE 30, 2000          $ (5,045,856)  $      3,991,128
SHARES ISSUED FOR
  Private placement                        0            112,480
  Exercise of options                      0              1,515
  For services                             0             40,000
  Held in escrow
    (note 6(a)(ii)(b)(i))                  0                  0
Stock option benefit                       0            272,207
Dividends on preferred shares        (30,720)           (30,720)
Share subscriptions                        0             50,000
Redeemed shares                     (100,000)          (200,000)
Foreign currency translation               0                (26)
Net loss for the year             (4,000,169)        (4,000,169)
----------------------------------------------------------------
BALANCE, JUNE 30, 2001            (9,176,745)           326,415
SHARES ISSUED FOR
  Proprietary non-competition
    agreement (note 6(a)(i))               0            711,000
  Held in escrow                           0                  0
  Exercise of options                      0            946,200
  Exercise of warrants                     0            130,000
  Subscriptions                            0                  0
Stock option compensation                  0            415,685
Shares released from escrow                0            954,582
Dividends on preferred shares        (26,087)           (26,087)
Redeemed shares                     (187,200)          (312,000)
Write-off of promissory
  note receivable                          0                  0
Net loss for the year             (3,836,191)        (3,836,191)
----------------------------------------------------------------
BALANCE, JUNE 30, 2002          $(13,226,223)  $       (690,396)
----------------------------------------------------------------
</TABLE>


                                        F-6
See notes to consolidated financial statements.
<PAGE>
<TABLE>
<CAPTION>
INTEGRAL TECHNOLOGIES, INC.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
(U.S. DOLLARS)

===========================================================================================================================
                                             COMMON                PREFERRED
                                            STOCK AND              STOCK AND
                                 SHARES      PAID-IN    SHARES OF   PAID-IN
                               OF COMMON     CAPITAL    PREFERRED   CAPITAL     PROMISSORY                       OTHER
                                 STOCK      IN EXCESS     STOCK    IN EXCESS      NOTES          SHARE       COMPREHENSIVE
                                 ISSUED      OF PAR      ISSUED      OF PAR     RECEIVABLE   SUBSCRIPTIONS       INCOME
---------------------------------------------------------------------------------------------------------------------------
<S>                            <C>         <C>          <C>        <C>         <C>           <C>             <C>
BALANCE, JUNE 30, 2002         30,787,562  $12,116,450    439,610  $  439,610  $   (66,500)  $            0  $       46,267
SHARES ISSUED FOR
  Private placement for cash    1,684,000      842,050          0           0            0                0               0
  Settlement of debt              144,793      104,542          0           0            0                0               0
  Services                        200,000      196,000          0           0            0                0               0
  Exercise of options              52,500       43,750          0           0            0                0               0
  Exercise of warrants             55,000       27,500          0           0            0                0               0
  Subscription received
    (note 6(a)(vi))                     0            0          0           0            0          176,665               0
  Stock option compensation             0        5,460          0           0            0                0               0
  Settlement of lawsuit
    (note 10(b))                        0            0          0           0            0           35,250               0
  Dividends on preferred
    shares                              0            0          0           0            0                0               0
  Net loss for year                     0            0          0           0            0                0               0
---------------------------------------------------------------------------------------------------------------------------

BALANCE, JUNE 30, 2003         32,923,855  $13,335,752    439,610  $  439,610  $   (66,500)  $      211,915  $       46,267
===========================================================================================================================


===============================================================
                                  DEFICIT
                                ACCUMULATED
                                DURING THE          TOTAL
                                DEVELOPMENT     STOCKHOLDERS'
                                   STAGE      EQUITY (DEFICIT)
---------------------------------------------------------------
<S>                            <C>            <C>
BALANCE, JUNE 30, 2002         $(13,226,223)  $       (690,396)
SHARES ISSUED FOR
  Private placement for cash              0            842,050
  Settlement of debt                      0            104,542
  Services                                0            196,000
  Exercise of options                     0             43,750
  Exercise of warrants                    0             27,500
  Subscription received
    (note 6(a)(vi))                       0            176,665
  Stock option compensation               0              5,460
  Settlement of lawsuit
    (note 10(b))                          0             35,250
  Dividends on preferred
    shares                          (22,060)           (22,060)
  Net loss for year              (1,346,833)        (1,346,833)
---------------------------------------------------------------

BALANCE, JUNE 30, 2003         $(14,595,116)  $       (628,072)
===============================================================
</TABLE>


                                        F-7
See notes to consolidated financial statements.
<PAGE>
<TABLE>
<CAPTION>
INTEGRAL TECHNOLOGIES, INC.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(U.S. DOLLARS)

======================================================================================================================
                                                                                                      PERIOD FROM
                                                                                                   FEBRUARY 12, 1996
                                                                 YEARS ENDED JUNE 30,             (INCEPTION) THROUGH
                                                           2003          2002          2001          JUNE 30, 2003
----------------------------------------------------------------------------------------------------------------------
<S>                                                    <C>           <C>           <C>           <C>
OPERATING ACTIVITIES
  Net loss                                             $(1,346,833)  $(3,836,191)  $(4,000,169)  $        (14,229,049)
  Adjustments to reconcile net loss to
  net cash used by operating activities
    Write-down of investment                                     0     1,249,999             0              1,249,999
    Cancellation of debt                                         0             0             0               (602,843)
    Proprietary, non-competition
      agreement (note 6(a)(i))                                   0       711,000                              711,000
    Consulting services and financing fees                 223,500       254,792        55,389                895,400
    Depreciation and amortization                           24,302        28,983        99,150                295,659
    Stock option compensation                                5,460       415,685       272,207                812,208
    Interest on beneficial conversion                            0             0             0                566,456
    Settlement of lawsuit                                   45,250             0             0                 60,250
    Write-down of license and operating assets                   0        46,842     1,382,046              1,853,542
    Bad debt                                                10,752        14,500        48,750                 76,571
  Changes in non-cash working capital
    Due from affiliated company                                  0             0             0               (116,000)
    Notes and accounts receivable                            3,873        (2,923)         (453)              (109,213)
    Inventory                                                    0             0       (21,842)               (46,842)
    Prepaid expenses                                         3,249       (14,928)        5,230                (11,844)
    Deferred revenue and other                             (13,232)            0             0                 (2,609)
    Accounts payable and accruals                         (112,371)      (95,852)      143,369                715,828
    Due to West Virginia University
      Research Corporation                                       0             0             0                397,296
----------------------------------------------------------------------------------------------------------------------
NET CASH USED BY OPERATING ACTIVITIES                   (1,156,050)   (1,228,093)   (2,016,323)            (7,484,191)
----------------------------------------------------------------------------------------------------------------------
INVESTING ACTIVITIES
  Purchase of property, equipment and
    intangibles assets                                           0             0       (66,401)              (200,935)
  Assets acquired and liabilities assumed
    on purchase of subsidiary                                    0             0             0               (129,474)
  Investment in and advances to affiliated companies             0             0      (950,000)            (2,000,000)
  License agreements                                             0             0             0               (124,835)
----------------------------------------------------------------------------------------------------------------------
NET CASH USED BY INVESTING ACTIVITIES                            0             0    (1,016,401)            (2,455,244)
----------------------------------------------------------------------------------------------------------------------
FINANCING ACTIVITIES
  Repayment of loan                                              0             0       (45,000)               (45,000)
  Advances from stockholders                                     0             0             0              1,078,284
  Repayments to stockholders                                     0             0             0                (94,046)
  Subscriptions received                                   176,665             0        50,000                226,665
  Proceeds from issuance of common stock                   885,800     1,426,332       188,606              8,528,895
  Proceeds from convertible debentures                           0             0             0                600,000
  Share issue costs                                              0             0             0               (227,420)
----------------------------------------------------------------------------------------------------------------------
NET CASH PROVIDED BY FINANCING ACTIVITIES                1,062,465     1,426,332       193,606             10,067,378
----------------------------------------------------------------------------------------------------------------------
EFFECT OF FOREIGN CURRENCY TRANSLATION ON CASH                   0             0           (26)                46,267
----------------------------------------------------------------------------------------------------------------------
INCREASE (DECREASE) IN CASH                                (93,585)      198,239    (2,839,144)               174,210
CASH, BEGINNING OF YEAR                                    267,795        69,556     2,908,700                      0
----------------------------------------------------------------------------------------------------------------------
CASH, END OF YEAR                                      $   174,210   $   267,795   $    69,556   $            174,210
======================================================================================================================
</TABLE>

Supplemental  cash  flow  information  (note  7)


                                        F-8
See notes to consolidated financial statements.
<PAGE>
INTEGRAL  TECHNOLOGIES,  INC.
(A  DEVELOPMENT  STAGE  COMPANY)
NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
YEARS  ENDED  JUNE  30,  2003,  2002  AND  2001
(U.S.  DOLLARS)

================================================================================

1.   INCORPORATION  AND  NATURE  OF  OPERATIONS

     The  Company  was  incorporated  under  the  laws of the State of Nevada on
     February 12, 1996 and has its head office in Bellingham, Washington, U.S.A.
     The  Company is in the development stage as more fully defined in Statement
     No.  7  of  the Financial Accounting Standards Board. The Company is in the
     business  of  researching,  developing  and  commercializing  new  antenna
     technologies.

     The  Company  will  be  devoting  all  of  its  resources  to the research,
     development  and  commercialization  of  its  antenna  technologies.  As  a
     consequence,  the  value  for  the  license  of  all other technologies was
     written  off  in  2001.

2.   GOING  CONCERN

     These consolidated financial statements have been prepared by management in
     accordance  with  accounting  principles  generally  accepted in the United
     States  of  America  on  a going concern basis. This presumes funds will be
     available  to  finance  on-going  development,  operations  and  capital
     expenditures  and  the realization of assets and the payment of liabilities
     in  the  normal  course  of  operations  for  the  foreseeable  future.

     The  Company  has  minimal  capital  resources  presently available to meet
     obligations  which  normally  can  be  expected  to  be incurred by similar
     companies,  has  a  working  capital  deficiency  (an  excess  of  current
     liabilities  over  current assets) of $682,355 (2002 - $768,980) and has an
     accumulated  deficit  during  the  development stage of $14,595,116 (2002 -
     $13,226,223).  These  factors  raise  substantial doubt about the Company's
     ability  to  continue as a going concern and is dependent on its ability to
     obtain and maintain an appropriate level of financing on a timely basis and
     to  achieve  sufficient  cash  flows  to  cover  obligations  and expenses.
     Management  is  continuously  working  to  obtain  financing  (note 6). The
     outcome  of these matters cannot be predicted. These consolidated financial
     statements  do  not  give  effect  to  any  adjustments  to the amounts and
     classification  of  assets  and liabilities which might be necessary should
     the  Company  be  unable  to  continue  its  operations as a going concern.


                                        F-9
<PAGE>
INTEGRAL  TECHNOLOGIES,  INC.
(A  DEVELOPMENT  STAGE  COMPANY)
NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
YEARS  ENDED  JUNE  30,  2003,  2002  AND  2001
(U.S.  DOLLARS)

================================================================================

3.   SIGNIFICANT  ACCOUNTING  POLICIES

     (a)  Principles  of  consolidation

          These  financial  statements  include  the  accounts  of  Integral
          Technologies,  Inc.  (a  development  stage company), its wholly-owned
          subsidiaries,  Integral  Vision  Systems,  Inc.  ("IVSI")  and  Antek
          Wireless  Inc.  ("Antek")  and  its 76.625% owned subsidiary, Emergent
          Technologies Corp. ("ETC"). All intercompany balances and transactions
          have  been eliminated. Investment in Continental Divide Robotics, Inc.
          ("CDRI")  is  accounted  for  using  the cost method since the Company
          exerts  no  significant  influence  (note  5).

     (b)  Depreciation

          Depreciation  is  provided using the straight-line method based on the
          following  estimated  useful  lives:

               Machinery,  furniture  and  equipment     -   5  Years
               Computer  hardware  and  software         -   5  Years
               Molds                                     -   5  Years

          The  Company  reviews  long-term  assets  to determine if the carrying
          amount  is  recoverable  based  on  the  estimate  of future cash flow
          expected  to  result  from  the  use  of  the  asset  and its eventual
          disposition.  If in this determination there is an apparent shortfall,
          the  loss  will  be  recognized  as  a  current  charge to operations.

     (c)  Loss  per  share

          Loss  per  share computations are based on the weighted average number
          of  common  shares  outstanding  during  the  period.  Common  share
          equivalents  consisting  of  stock  options  and  warrants  are  not
          considered  in  the  computation  because  their  effect  would  be
          anti-dilutive.

     (d)  Stock  issued  in  exchange  for  services

          The  valuation  of the common stock issued in exchange for services is
          valued at an estimated fair market value as determined by officers and
          directors  of  the Company based upon other sales and issuances of the
          Company's  common  stock  within  the  same  general  time  period.


                                       F-10
<PAGE>
INTEGRAL  TECHNOLOGIES,  INC.
(A  DEVELOPMENT  STAGE  COMPANY)
NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
YEARS  ENDED  JUNE  30,  2003,  2002  AND  2001
(U.S.  DOLLARS)

================================================================================

3.   SIGNIFICANT  ACCOUNTING  POLICIES  (Continued)

     (e)  Revenue  recognition

          As  the  Company  is  continuing  development  of its technologies, no
          significant  revenues have been earned to date. The Company recognizes
          revenues  at  the  time  of  delivery of the product to the customers.

     (f)  Foreign  currency  translation

          Assets  and  liabilities  of  non-U.S.  subsidiaries that operate in a
          local  currency environment are translated to U.S. dollars at year-end
          exchange  rates.  Income  and  expense  items  are  translated  at
          weighted-average  rates  of  exchange  prevailing  during  the  year.
          Translation  adjustments  are recorded in accumulated gains and losses
          not affecting retained earnings within stockholders' equity (deficit).

          Property  and  equipment and other non-monetary assets and liabilities
          of non-U.S. subsidiaries and branches that operate in U.S. dollars, or
          whose  economic  environment is highly inflationary, are translated at
          approximate  exchange  rates  prevailing when the Company acquired the
          assets or liabilities. All other assets and liabilities are translated
          at  year-end  exchange  rates.  Cost  of  sales  and  depreciation are
          translated  at historical exchange rates. All other income and expense
          items  are  translated  at  the  weighted-average  rates  of  exchange
          prevailing  during  the  year.  Gains  and  losses  that  result  from
          translation  are  included  in  the  determination  of  net  loss.

     (g)  Research  and  development

          Research  and  development  expenditures  are charged to operations as
          incurred.

     (h)  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 disclosures 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 and would impact
          future  results  of  operations  and  cash  flows.


                                       F-11
<PAGE>
INTEGRAL  TECHNOLOGIES,  INC.
(A  DEVELOPMENT  STAGE  COMPANY)
NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
YEARS  ENDED  JUNE  30,  2003,  2002  AND  2001
(U.S.  DOLLARS)

================================================================================

3.   SIGNIFICANT  ACCOUNTING  POLICIES  (Continued)

     (i)  Financial  instruments

          (a)  Fair  value

               The carrying value of cash, accounts receivable, accounts payable
               and  accruals  and  due  to  West  Virginia  University  Research
               Corporation  approximate  their  fair  value because of the short
               maturity  of  these  financial  instruments.

          (b)  Interest  rate  risk

               The  Company is not exposed to significant interest rate risk due
               to  the  short-term  maturity  of its monetary current assets and
               current  liabilities.

          (c)  Credit  risk

               The  Company's  financial  assets that are exposed to credit risk
               consist  primarily  of  cash which is placed with major financial
               institutions.

          (d)  Translation  risk

               The  Company  translates the results of non-US operations into US
               currency  using rates approximating the average exchange rate for
               the year. The exchange rate may vary from time to time. This risk
               is  considered  nominal  as  the  Company  does  not  incur  any
               significant  transactions  in  non-US  currency.

     (j)  Income  taxes

          The  Company  uses  the  asset and liability approach in its method of
          accounting for income taxes which requires the recognition of deferred
          tax  liabilities  and  assets  for expected future tax consequences of
          temporary  differences  between the carrying amounts and the tax basis
          of  assets and liabilities. A valuation allowance against deferred tax
          assets  is  recorded if, based upon weighted available evidence, it is
          more  likely than not that some or all of the deferred tax assets will
          not  be  realized.


                                       F-12
<PAGE>
INTEGRAL  TECHNOLOGIES,  INC.
(A  DEVELOPMENT  STAGE  COMPANY)
NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
YEARS  ENDED  JUNE  30,  2003,  2002  AND  2001
(U.S.  DOLLARS)

================================================================================

3.   SIGNIFICANT  ACCOUNTING  POLICIES  (Continued)

     (k)  Stock-based  compensation

          The  Company applies APB Opinion No. 25 and related interpretations in
          accounting  for  its  stock  options  granted  to  employees,  and
          accordingly,  compensation  expense  of  $Nil  (2002  - $7,800; 2001 -
          $219,200) was recognized as salaries expense. Had compensation expense
          been determined as provided in SFAS 123 using the Black-Scholes option
          -  pricing  model,  the pro-forma effect on the Company's net loss and
          per  share  amounts  would  have  been  as  follows:

<TABLE>
<CAPTION>
          ===========================================================================================
                                                                 2003          2002          2001
          -------------------------------------------------------------------------------------------
<S>                                                          <C>           <C>           <C>

          Net loss, as reported                              $(1,346,833)  $(3,836,191)  $(4,000,169)
          Add:  Stock-based employee compensation
          expense under intrinsic value method included in
          reporting net income, net of related tax effects             0         7,800       219,200

          Deduct:  Total stock-based compensation
          expense determined under fair value based
          method for all awards, net of related tax effects     (230,180)     (320,640)     (392,000)
          -------------------------------------------------------------------------------------------

          Net loss, pro-forma                                $(1,577,013)  $(4,149,031)  $(4,172,969)
          ===========================================================================================

          Net loss per share, as reported                    $     (0.04)  $     (0.13)  $     (0.15)
          Add:  Stock-based employee compensation
          expense under intrinsic value method included in
          reporting net income, net of related tax effects          0.00          0.00          0.01

          Deduct:  Total stock-based compensation
          expense determined under fair value based
          method for all awards, net of related tax effects        (0.01)        (0.01)        (0.02)
          -------------------------------------------------------------------------------------------

          Net loss per share, pro-forma                      $     (0.05)  $     (0.14)  $     (0.16)
          ===========================================================================================
</TABLE>

          The  Company  applies  SFAS  123  in  accounting for its stock options
          granted  to  non-employees,  and  accordingly, compensation expense of
          $5,460  (2002  -  $Nil;  2001  - $53,007) was recognized as consulting
          expense.


                                       F-13
<PAGE>
INTEGRAL  TECHNOLOGIES,  INC.
(A  DEVELOPMENT  STAGE  COMPANY)
NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
YEARS  ENDED  JUNE  30,  2003,  2002  AND  2001
(U.S.  DOLLARS)

================================================================================

3.   SIGNIFICANT  ACCOUNTING  POLICIES  (continued)

     (k)  Stock  based  compensation  (Continued)

          The  fair value of each option grant is calculated using the following
          weighted  average  assumptions:

<TABLE>
<CAPTION>
          ======================================================================
                                              2003         2002         2001
          ----------------------------------------------------------------------
<S>                                        <C>          <C>          <C>
          Expected life (years)                   2.2            2            5
          Interest rate                          3.00%        4.38%        5.00%
          Volatility                            51.50%       71.86%       61.04%
          Dividend yield                         0.00%        0.00%        0.00%
          ======================================================================
</TABLE>

     (l)  Comprehensive  income

          Other  comprehensive  income  includes  revenues  and  expenses  and
          unrealized gains and losses that under accounting principles generally
          accepted  in the United States of America are excluded from net income
          (loss)  and  are  recorded  directly as an adjustment to stockholders'
          equity,  net of tax. When the unrealized gains and losses are realized
          they  are reclassified from other comprehensive income and included in
          net  income.  The  Company's  other  comprehensive  income  (loss)  is
          composed  of  unrealized  gains  and  losses  from  foreign  currency
          translation  adjustments.

     (m)  Recent  accounting  pronouncements

          (i)  In  December  2002,  FASB  issued  SFAS  148,  "Accounting  for
               Stock-based  Compensation  -  Transition  and  Disclosure,  an
               amendment  to  SFAS  123".  SFAS  148  provides  two  additional
               transition  methods for entities that adopt the preferable method
               of  accounting  for  stock-based  compensation.  Further,  the
               statement  requires  disclosure of comparable information for all
               companies  regardless  of  whether, when, or how an entity adopts
               the  preferable,  fair  value  method  of  accounting.  These
               disclosures are now required for interim periods in additional to
               the  traditional  annual  disclosure.  The amendment to SFAS 123,
               which  provides  for  additional  methods,  are effective for the
               periods  beginning  after  December  15,  2002,  although earlier
               application  is  permitted.  The  amendments  to  the  disclosure
               requirements  are  required  for  financial  reports  containing
               condensed  financial  statements  for  interim  periods beginning
               after  December  15, 2002. The Company adopted these requirements
               effective  July  1,  2002.


                                       F-14
<PAGE>
INTEGRAL  TECHNOLOGIES,  INC.
(A  DEVELOPMENT  STAGE  COMPANY)
NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
YEARS  ENDED  JUNE  30,  2003,  2002  AND  2001
(U.S.  DOLLARS)

================================================================================

3.   SIGNIFICANT  ACCOUNTING  POLICIES  (Continued)

     (m)  Recent  accounting  pronouncements  (Continued)

          (ii) In  January  2003,  the  FASB  issued  Interpretation  No.  46,
               Consolidation of Variable Interest Entities, an interpretation of
               Accounting  Research  Bulletin  No.  51,  Consolidated  Financial
               Statements. Interpretation 46 establishes accounting guidance for
               consolidation  of  variable  interest  entities  that function to
               support the activities of the primary beneficiary. Interpretation
               46  applies  to  any business enterprise both public and private,
               that  has  a  controlling  interest,  contractual relationship or
               other  business relationship with a variable interest entity. The
               Company has no investment in or contractual relationship or other
               business  relationship  with  a  variable  interest  entity  and
               therefore  the  adoption did not have any impact on the Company's
               consolidated  financial  position,  results of operations or cash
               flows.

          (iii)On  April  30, 2003, the FASB issued Statement No. 149, Amendment
               of  Statement  133  on  Derivative  Instruments  and  Hedging
               Activities.  Statement  149  is  intended  to  result  in  more
               consistent  reporting  of  contracts  as  either  freestanding
               derivative  instruments subject to Statement 133 in its entirety,
               or  as  hybrid  instruments with debt host contracts and embedded
               derivative  features.  In  addition,  Statement 149 clarifies the
               definition  of  a derivative by providing guidance on the meaning
               of  initial net investments related to derivatives. Statement 149
               is  effective  for  contracts entered into or modified after June
               30, 2003. The Company believes the adoption of Statement 149 will
               not  have  any  effect  on  its  consolidated financial position,
               results  of  operations  or  cash  flows.

          (iv) On  May  15,  2003, the FASB issued Statement No. 150, Accounting
               for  Certain  Financial  Instruments with Characteristics of both
               Liabilities  and  Equity. Statement 150 establishes standards for
               classifying  and  measuring  as  liabilities  certain  financial
               instruments  that  embody  obligations  of  the  issuer  and have
               characteristics  of  both  liabilities  and equity. Statement 150
               represents a significant change in practice in the accounting for
               a  number  of  financial  instruments,  including  mandatorily
               redeemable equity instruments and certain equity derivatives that
               frequently are used in connection with share repurchase programs.
               Statement  150 is effective for all financial instruments created
               or  modified  after  May 31, 2003, and to other instruments as of
               September  1,  2003. The Company adopted Statement 150 on July 1,
               2003  and believes the effect of adopting this statement will not
               have  any  impact on its consolidated financial position, results
               of  operations  or  cash  flows.

          (v)  On  April  2002, the FASB issued statement No. 145, Rescission of
               FASB  No.  4  Reporting  Gains  and Losses from Extinguishment of
               Debt, and amendment of FASB No. 64 Extinguishment of Debt made to
               Satisfy  Sinking-fund  Requirements. This statement also rescinds
               FASB  No.  44  Accounting for intangible Assets of Motor Carriers
               and  also amends FASB No 13 Accounting for leases to eliminate an
               inconsistency  in  accounting  for  sale-leaseback.  The  Company
               adopted  this  statement  effective  July  1, 2002. The impact of
               adopting  this  statement is the reclassification of cancellation
               of  debt,  previously  recorded  as  extraordinary item, to other
               income.


                                       F-15
<PAGE>
INTEGRAL  TECHNOLOGIES,  INC.
(A  DEVELOPMENT  STAGE  COMPANY)
NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
YEARS  ENDED  JUNE  30,  2003,  2002  AND  2001
(U.S.  DOLLARS)

================================================================================

4.   PROPERTY  AND  EQUIPMENT

<TABLE>
<CAPTION>
     ===========================================================================
                                                    2003              2002
     ---------------------------------------------------------------------------
<S>                                           <C>               <C>
     Machinery, furniture and equipment       $       148,940   $       148,940
     Computer hardware and software                    39,419            39,419
     Molds                                              4,800             4,800
     ----------------------------------------------------------------------

                                                      193,159           193,159
     Less:  Accumulated depreciation                 (138,877)         (114,576)
     ---------------------------------------------------------------------------

                                              $        54,282   $        78,583
     ===========================================================================
</TABLE>

5.   INVESTMENTS

     In  July  2000,  the  Company  executed  a  Stock  Purchase  Agreement with
     Continental  Divide  Robatics Inc. ("CDRI") related to the acquisition of a
     minority  interest in CDRI. CDRI has developed certain proprietary hardware
     and  software  systems  that use a radio-navigation, satellite-based Global
     Positioning  System  to  track  individuals,  on  a  real  time  basis.

     Pursuant  to  the  agreement, the Company invested $1.25 million dollars to
     acquire 20.33% of the outstanding common stock of CDRI. Because the Company
     has  no  influence  or  control  over  CDRI,  and  no  ability  to exercise
     significant influence over CDRI, the Company's investment has been recorded
     at  cost  using  the  cost  method.

     CDRI  is  a  privately  held  company and there is no public market for its
     common  stock.  CDRI  has  a  working  capital deficiency and has sustained
     continued  significant  operating  losses.  Due  to  the  Company's lack of
     control  over  the  operations  of CDRI, lack of information concerning the
     business  prospects  of  CDRI, lack of financial information concerning the
     ability  of  CDRI to continue as a going concern, and lack of liquidity for
     the  Company's  investment in CDRI during the year ended June 30, 2002, the
     Company  wrote  down  its  investment  in CDRI from $1,250,000 to a nominal
     value  of $1. This decision was made in consideration of the foregoing, and
     in  order  to  conform with accounting principles generally accepted in the
     United  States of America. However, CDRI remains an active business entity,
     possessing  proprietary technology, and continues to market its technology.
     The  Company has no current information to suggest that the CDRI technology
     or  the  business  opportunity  for  such  technology  has  been negatively
     impacted.  The  Company continues to retain its ownership position in CDRI.


                                       F-16
<PAGE>
INTEGRAL  TECHNOLOGIES,  INC.
(A  DEVELOPMENT  STAGE  COMPANY)
NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
YEARS  ENDED  JUNE  30,  2003,  2002  AND  2001
(U.S.  DOLLARS)

================================================================================

6.   STOCKHOLDERS'  EQUITY  (DEFICIT)

     (a)  Common  stock

          (i)  During  the  year ended June 30, 2002, the Company entered into a
               proprietary,  non-disclosure  and non-solicitation agreement with
               two  of  its  employees  whereby,  for  a total of 450,000 common
               shares, these employees will not disclose any information that is
               defined  as  confidential  by  the Company in this agreement; the
               employees will work for the Company exclusively while employed by
               the Company and will not work for a competitor for a period of at
               least  three  years  after leaving the Company. These shares were
               recorded  at $1.58 per common share being the market price at the
               date  of  issue  for  a  total  charge to operations of $711,000.

          (ii) Private  placement  agreement

               (a)  During  the  year  ended  June 30, 2000, the Company entered
                    into  a  private  placement  agreement  with  Swartz Private
                    Equity,  LLC  ("Swartz") which called for periodic purchases
                    over  a  three  year  period  of  up  to  $25,000,000 of the
                    Company's  common  stock.  This  agreement expired May 2003.

                    Each  periodic  purchase  ("put") will have a purchase price
                    equal  to the lesser of the market price minus $0.25, or 91%
                    of  the  market  price,  but  not less than a stated minimum
                    purchase  price  as  set  in  the  advance put notice, which
                    cannot be greater than 80% of the market price on that date.

                    Each  put  cannot  exceed  the  lesser  of:

                    (i)  $2,000,000  worth  of  common  stock;

                    (ii) 15%  of  the  aggregate  reported trading volume of the
                         Company's  common  stock  during  the  20 business days
                         before  and  after  the date of notice to exercise each
                         put;  and,

                   (iii) a  number  of shares that would cause Swartz to acquire
                         in  a 31 day period preceding the put date, in total in
                         excess of 9.99% of the Company's total number of shares
                         of  common  stock  outstanding  at  that  time.

                    At  the  time  of  each put, the Company will issue Swartz a
                    purchase  warrant  which  will  give  Swartz  the  right  to
                    purchase  up  to  10%  of the number of shares issued in the
                    put. Each warrant will be immediately exercisable for a five
                    year  period  for  a price equal to 110% of the market price
                    for  such  put.


                                       F-17
<PAGE>
INTEGRAL  TECHNOLOGIES,  INC.
(A  DEVELOPMENT  STAGE  COMPANY)
NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
YEARS  ENDED  JUNE  30,  2003,  2002  AND  2001
(U.S.  DOLLARS)

================================================================================

6.   STOCKHOLDERS'  EQUITY  (DEFICIT)  (Continued)

    (a)  Common  stock  (Continued)

         (ii) Private  placement  agreement  (Continued)

               If  the  Company has not put a minimum of $1,000,000 in aggregate
               Put  Dollar Amount during any six month period of time during the
               term of the Investment Agreement, the Company will be required to
               pay  Swartz  a  non-usage fee equal to the difference of $100,000
               minus  10%  of  the aggregate Put Dollar Amount of the Put Shares
               put to Swartz during such six month period. In the event that the
               Company  delivers  a termination notice to Swartz or an automatic
               termination occurs, the Company must pay Swartz a termination fee
               equal  to  the  greater  of  the non-usage fee for the applicable
               period  or  the difference of $200,000 minus 10% of the aggregate
               Put Dollar Amount of the Put Shares put to Swartz during all Puts
               to  such date. The non-usage fee for the year ended June 30, 2003
               has  been  waived as the agreement expired. The non-usage fee for
               the  year  ended June 30, 2002 of $104,542 was settled in 2003 by
               issuance of 144,793 shares of common stock. The non-usage fee for
               the  period  prior  to  August 3, 2001 has been waived by Swartz.

               (b)  Pursuant  to  this  agreement:

                    (i)  During the year ended June 30, 2001, the Company issued
                         300,000  shares to be held in escrow to exercise a put.
                         Of  these,  81,885 shares were released on the exercise
                         of  the  put  and 218,115 are held in escrow for future
                         put  exercises.

                         As  partial  consideration  of the investment agreement
                         the  Company  issued  warrants  to  Swartz  to purchase
                         495,000  shares  of  common  stock  (note  6(d)(i)).

                    (ii) During the year ended June 30, 2002, the Company issued
                         700,000 shares held in escrow to exercise puts. 775,975
                         shares  were released on the exercise of these puts for
                         total  proceeds  of $954,582, leaving 142,140 shares in
                         escrow  at  June 30, 2002. As part of these puts 85,788
                         warrants  were  issued  (note  6(d)(ii).

                   (iii) During  the  year  ended  June  30, 2003, the Company
                         settled  the non-usage fee of $104,542 due to Swartz by
                         issuing  144,793  shares  of  common  stock.

                    (iv) Subsequent  to  June  30,  2003,  the 142,140 shares in
                         escrow  were  returned  to  the  Company and cancelled.


                                       F-18
<PAGE>
INTEGRAL  TECHNOLOGIES,  INC.
(A  DEVELOPMENT  STAGE  COMPANY)
NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
YEARS  ENDED  JUNE  30,  2003,  2002  AND  2001
(U.S.  DOLLARS)

================================================================================

6.   STOCKHOLDERS'  EQUITY  (DEFICIT)  (Continued)

     (a)  Common  stock  (continued)

         (iii) During  the  year ended June 30, 2003, the Company entered into a
               private  placement  agreement  with various investors whereby the
               Company  issued 1,684,000 units consisting of one share of common
               stock  and  one-half a share purchase warrant at a price of $0.50
               per  unit.  Each whole warrant is exercisable at a price of $0.75
               per  share  and  expires  two  years  after  the  date  of grant.

          (iv) During  the  year ended June 30, 2003, the Company entered into a
               letter of agreement whereby the Company will pay a monthly fee of
               $10,000  for  investor  relations and maintenance fees commencing
               March  7,  2003  for  a period of one year. For introductions for
               private placement money, the Company will pay a three percent fee
               for  every  one  million  dollars  raised through this agreement.

               As  part  of  this agreement, the Company agreed to issue 200,000
               common  shares  which  was  recognized  as  consulting expense at
               market  value  on the date of the transaction totalling $196,000.

          (v)  During  the  year  ended June 30, 2003, the Company issued 55,000
               shares  at  a  price  of $0.50 per share on exercise of warrants.

          (vi) Subsequent  to  June 30, 2003, the Company entered into a private
               placement  whereby  the  Company  will  issue  a total of 898,336
               shares  at a price of $0.75 per  share and 449,168 share purchase
               warrants  exercisable  within two years with an exercise price of
               $1.00  per share. As at June 30, 2003, $176,665 has been received
               pursuant  to  this  agreement.

     (b)  Preferred  stock

          The  preferred  stock  may  be  issued  in  one  or  more  series. The
          distinguishing  features  of  each series including preference, rights
          and  restriction  are  to  be  determined  by  the  Company's Board of
          Directors  upon  the  establishment  of  each  such  series.

          During  the year ended June 30, 2000, the Company designated 1,000,000
          of  its authorized 20,000,000 preferred shares as Series A Convertible
          Preferred Stock with a par value of $0.001 each and a stated value and
          liquidation  preference  of  $1.00 per share. Cumulative dividends are
          accrued  at  the  rate  of  5%  annually, payable at the option of the
          Company.  The  shares  may be converted to restricted shares of common
          stock  at  the average trading price ten days prior to conversion, and
          entitled  to  votes equal to the number of shares of common stock into
          which  each  series of preferred stock may be converted. Each Series A
          Convertible  Preferred  Stock may be redeemed by the Company for $1.50
          each  within  one  year after the date of issue, and for $2.00, $2.50,
          $3.00  and  $3.50 per share in each of the subsequent four years after
          the  date  of  issue.


                                       F-19
<PAGE>
INTEGRAL  TECHNOLOGIES,  INC.
(A  DEVELOPMENT  STAGE  COMPANY)
NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
YEARS  ENDED  JUNE  30,  2003,  2002  AND  2001
(U.S.  DOLLARS)

================================================================================

6.   STOCKHOLDERS'  EQUITY  (DEFICIT)  (Continued)

     (b)  Preferred  stock  (Continued)

          During  the  year  ended  June  30, 2000, the Company agreed to settle
          $383,228  of  accounts  payable  and  $281,182 of long-term debt, both
          amounts  owed  to  officers  and  directors of the Company, by issuing
          664,410  shares of Series A convertible preferred stock at a par value
          of  $0.001  and  a  stated  value  of  $1.00  per  share.

          During  the  year  ended  June  30, 2002, the Company redeemed 124,800
          (2001  - 100,000) preferred shares at a total cost of $312,000 (2001 -
          $200,000).

     (c)  Stock  options

          In  January  2001 the Company adopted the "Integral Technologies, Inc.
          2001  Stock Plan" (the "2001 Plan"), a non-qualified stock option plan
          under  which  the  Company may issue up to 2,500,000 stock options and
          stock  bonuses of common stock of the Company to provide incentives to
          officers, directors, key employees and other persons who contribute to
          the  success  of  the  Company. This plan was amended December 2001 to
          increase  the number of common share options which may be granted from
          2,500,000  to  3,500,000  stock  options.

          The following table summarizes the Company's stock option activity for
          the  years  ended  June  30,  2003,  2002  and  2001:

<TABLE>
<CAPTION>
          =====================================================================
                                                                      Weighted
                                                         Exercise      Average
                                           Number         Price       Exercise
                                          of Shares     Per Share       Price
          ---------------------------------------------------------------------
<S>                                      <C>          <C>             <C>
          Balance, June 30, 2000          1,610,000   $0.15 to $2.00  $    0.27
          Granted during the year
            June 30, 2001                   689,500   $0.15 to $0.65  $    0.50
          Cancelled                        (209,000)  $         0.15  $    0.15
          Expired                          (235,000)  $0.15 to $2.00  $    0.66
          Exercised                        (517,000)  $0.15 to $0.20  $    0.17
          ---------------------------------------------------------------------
          Balance, June 30, 2001          1,338,500   $0.15 to $1.00  $    0.35
          Granted during the year
            June 30, 2002                 2,430,000   $0.40 to $1.50  $    0.63
          Exercised                      (2,463,500)  $0.15 to $1.20  $    0.41
          ---------------------------------------------------------------------
          Balance, June 30, 2002          1,305,000   $0.40 to $1.50  $    0.76
          Granted during the year
            June 30, 2003                 1,230,000   $          100  $    1.00
          Exercised                         (52,500)  $0.69 to $1.50  $    0.83
          Cancelled                        (575,000)  $0.40 to $1.00  $    0.66
          ---------------------------------------------------------------------

          Balance, June 30, 2003          1,907,500   $0.40 to $1.50  $    0.94
          =====================================================================
</TABLE>


                                       F-20
<PAGE>
INTEGRAL  TECHNOLOGIES,  INC.
(A  DEVELOPMENT  STAGE  COMPANY)
NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
YEARS  ENDED  JUNE  30,  2003,  2002  AND  2001
(U.S.  DOLLARS)

================================================================================

6.  STOCKHOLDERS'  EQUITY  (DEFICIT)  (Continued)

    (c)  Stock  options  (Continued)

          The  following summarizes the options outstanding at June 30, 2003 and
          2002  all  of  which  were  fully  vested  at  these  dates:

<TABLE>
<CAPTION>
          ============================================================================
                                     Exercise          Number of           Shares
          Expiry Date                  Price              2003              2002
          ----------------------------------------------------------------------------
<S>                              <C>                <C>               <C>
          August 31, 2003          $ 0.40 to $1.50         1,077,500         1,305,000
          December 31, 2005            $1.00                 830,000                 0
          ============================================================================
</TABLE>

          Pursuant  to  the  2001  Plan:

          (i)  During  the year ended June 30, 2003, the Company granted a total
               of  1,230,000  stock  options  to  officers,  directors  and  key
               employees at an exercise price of $1.00 per common share. 400,000
               of these options are fully vested at the date of grant and expire
               August  31,  2003  and  830,000 vested January 1, 2003 and expire
               December  31,  2005.

          (ii) During  the year ended June 30, 2002, the Company granted a total
               of  2,430,000  fully vested stock options to officers, directors,
               key  employees  and consultants at an exercise price ranging from
               $0.40  to  $1.50  per  share  which  will expire August 31, 2003.

          Subsequent  to June 30, 2003, the Company extended the options with an
          expiry  date  of  August  31,  2003  to  August  31,  2004.

          In  April  2003,  the Company adopted the "Integral Technologies, Inc.
          2003  Stock Plan" (the "2003 Plan"), a non-qualified stock option plan
          under which the Company may issue up to 1,500,000 stock options. As of
          June 30, 2003, no options have been granted with respect to this plan.

     (d)  Stock  purchase  warrants

          At  June  30,  2003,  the  following  stock  purchase  warrants  were
          outstanding:

          (i)  440,000 (2002 - 495,000) with an adjusted exercise price of $0.50
               exercisable  before  November  10,  2005;

          (ii) 85,788 (2002 - 85,788) with exercise prices ranging from $0.51 to
               $1.18  exercisable  on  or  before  November  10,  2005;  and

         (iii) 842,000 with exercise price of $0.75 exercisable before November
               1,  2004.

          Both  (i)  and  (ii) above have reset provisions, whereby the exercise
          price  is  adjusted  to  110% of the five day average on every month's
          anniversary  of  the  warrants.


                                       F-21
<PAGE>
INTEGRAL  TECHNOLOGIES,  INC.
(A  DEVELOPMENT  STAGE  COMPANY)
NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
YEARS  ENDED  JUNE  30,  2003,  2002  AND  2001
(U.S.  DOLLARS)

================================================================================

6.   STOCKHOLDERS'  EQUITY  (DEFICIT)(Continued)

     (e)  Promissory  notes  receivable  at  June  30,  2003  includes:

          (i)  $31,500  (2002  -  $31,500)  due  on  exercise  of  210,000 stock
               options,  interest  at  10%  per  annum,  due  November  1, 2002,
               subsequently  extended  to  June  30,  2003.

          (ii) $20,000  (2002  -  $20,000)  due  on  exercise  of  100,000 stock
               options,  interest  at  8%  per  annum  due  June  6,  2002.

         (iii) $15,000  (2002  -  $15,000)  due  on  exercise  of  23,000  stock
               options,  interest  at  10%  per  annum  due  June  30,  2003.

          As  at  September 3, 2003, these notes have not been collected. Shares
          issued  on  exercise  of  options  are  restricted  for trading by the
          Company.  The  restrictions  will  not be removed until the respective
          notes  are  paid  to  the  Company.

7.   SUPPLEMENTAL  DISCLOSURE  OF  CASH  FLOW  INFORMATION

<TABLE>
<CAPTION>
     ===============================================================================================
                                                                                       PERIOD FROM
                                                                                      FEBRUARY 12,
                                                                                          1996
                                                                                       (INCEPTION)
                                                                                         THROUGH
                                                          2003      2002     2001     JUNE 30, 2003
     -----------------------------------------------------------------------------------------------
<S>                                                     <C>       <C>       <C>      <C>
     SUPPLEMENTAL DISCLOSURE OF NON-CASH TRANSACTIONS
     SHARES ISSUED
       For property and equipment                       $      0  $ 18,000  $     0  $        23,000
       For proprietary agreement                               0   711,000        0          711,000
       For settlement of accounts payable                104,542   124,200        0          124,200
       For services (provided by officers
         and directors)                                        0         0        0          120,000
       For settlement of lawsuit                               0         0        0           15,000
       For services                                      223,500   150,250   45,265          634,911
       For acquisition of subsidiary                           0         0        0          894,200
     SUPPLEMENT CASH FLOW INFORMATION
       Interest paid                                           0         0        0           81,111
       Income tax paid                                         0         0        0                0
     ===============================================================================================
</TABLE>

8.   RELATED  PARTY  TRANSACTIONS

     (a)  Accounts  payable at June 30, 2003 includes $269,660 (2002 - $178,128)
          due  to  two  directors  and  officers  of  the  Company.

     (b)  The  Company  incurred $340,000 (2002 - $312,000; 2001 - $276,000) for
          wages  due  to  two  directors  and  officers  of  the  Company.


                                       F-22
<PAGE>
INTEGRAL  TECHNOLOGIES,  INC.
(A  DEVELOPMENT  STAGE  COMPANY)
NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
YEARS  ENDED  JUNE  30,  2003,  2002  AND  2001
(U.S.  DOLLARS)

================================================================================

9.   INCOME  TAXES

     Deferred  income  taxes reflect the tax effect of the temporary differences
     between  the  carrying  amount  of  assets  and  liabilities  for financial
     reporting purposes and the amounts used for tax purposes. The components of
     the  net  deferred  income  tax  assets  are  as  follows:

<TABLE>
<CAPTION>
     ================================================================================================
                                                  2003                2002                2001
     ------------------------------------------------------------------------------------------------
<S>                                        <C>                 <C>                 <C>
     Deferred income tax assets
       Net operating loss
         and credit
         Carryforwards                     $       3,900,000   $       3,400,000   $       2,400,000
       Temporary differences
         on property and
         equipment depreciation                       (1,000)             (1,000)             (1,000)
     ------------------------------------------------------------------------------------------------

     Gross deferred tax assets                     3,899,000           3,399,000           2,399,000
     Valuation allowance                          (3,899,000)         (3,399,000)         (2,399,000)
     ------------------------------------------------------------------------------------------------

                                           $               0   $               0   $               0
     ================================================================================================
</TABLE>

     As  at  June  30,  2003  the Company's net operating loss carryforwards for
     income  tax  purposes  were approximately $8,300,000. If not utilized, they
     will  start  to  expire  in  2017.

10.  CONTINGENCIES

     (a)  A dispute exists between West Virginia University Research Corporation
          ("WVURC")  and  the  Company  with  respect  to  the  development work
          performed  by  WVURC on the Plasma Ignition System and the Counterfeit
          Detection  Technology.  The  Company  has included in its accounts the
          amount  alleged by WVURC to be owing to WVURC of $397,296, however, it
          is  the opinion of management that this amount should be reduced to an
          amount  not  greater  than  $43,052. Management intends to defend this
          position. As the actual outcome cannot be determined at this time, any
          adjustments  required  will be recorded by the Company when settlement
          occurs.


                                       F-23
<PAGE>
INTEGRAL  TECHNOLOGIES,  INC.
(A  DEVELOPMENT  STAGE  COMPANY)
NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
YEARS  ENDED  JUNE  30,  2003,  2002  AND  2001
(U.S.  DOLLARS)

================================================================================

10.  CONTINGENCIES  (Continued)

     (b)  On  August  9,  2000, the Company filed a Petition for Order to Compel
          Arbitration  against  Joffre  Rolland  in  the District Court of Clark
          County,  State  of  Nevada.  The  purpose of the Petition for Order to
          Compel  Arbitration  was to require Joffre Rolland, a former employee,
          to  arbitrate employment issues that had arisen under contracts he had
          entered  into  with the Company. On November 3, 2000, the Nevada State
          Court  ordered Joffre Rolland to arbitrate the dispute in the State of
          Nevada.  Instead  of arbitrating as required by the Nevada State Court
          Order,  Joffre  Rolland  and Robin Rolland (the "Rollands") filed suit
          against  the  Company  and ETC in October 2000 in the Circuit Court of
          Harrison  County,  West Virginia. The Rollands' complaint alleges that
          the Rollands suffered damages and are seeking in excess of $18 million
          in  damages  (including at least $18 million for lost sales royalties)
          for  their claims for relief. The Company filed a petition in the U.S.
          District  Court,  District  of  Nevada,  for  an  order  compelling
          arbitration.  On  June  6,  2001,  the  U.S.  District Court of Nevada
          ordered  the  dispute between the parties be arbitrated in Nevada, and
          that the action pending before the West Virginia State Court be stayed
          pending  completion of the arbitration. The parties have commenced the
          process  of  arbitration.  Management  intends  to  vigorously  defend
          against  these  claims.  As  the  outcome of this litigation cannot be
          determined  at this time, any adjustments required will be recorded by
          the  Company  when  the  outcome  becomes  determinable.

          In  a  mutual  release in full of all claims dated August 5, 2003, the
          Rollands  received  the  following  consideration:

          (a)  Integral agreed to amend U.S. patent number 6,320,548 B1 and U.S.
               patent  number  6,329,950  B1  to add Joffre J. Rolland Jr. as an
               inventor.

          (b)  Joffre  J.  Rolland  Jr.  will  be  entitled  to  receive  future
               royalties  on any sales of products covered by U.S. patent number
               6,320,548  B1  and  U.S.  patent  number  6,329,950  B1.

          (c)  Joffre  J.  Rolland  Jr.  will receive $10,000 in cash and 37,500
               shares  of  Integral  common  stock, issued pursuant to Rule 144.

          The  settlement  has  been  recorded in the accounts at June 30, 2003.
          These  shares  were  issued  subsequent  to  year  end.

     (c)  On  April  4,  2003,  a suit was filed against the Company by James E.
          Smith  seeking damages in excess of one million dollars for claims for
          relief  of  Breach  of  Contract,  Quantum  Mervit  and/or  Promissory
          Estoppel,  Fraud,  Conversion  and  Negligence. The Company has denied
          these  allegations  and  asserted  several  Affirmative  Defenses.

          In  addition,  the Company filed counter-claims against James E. Smith
          for  relief  of  Intentional  Misrepresentation,  Breach  of  Contract
          Negligence, Misrepresentation, Rescission and Restitution. The parties
          have  participated  in  mediation  to  resolve  the  litigation but no
          resolution has been reached as at September 3, 2003. Trial is schedule
          to  commence  July  26,  2004.


                                       F-24
<PAGE>
INTEGRAL  TECHNOLOGIES,  INC.
(A  DEVELOPMENT  STAGE  COMPANY)
NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
YEARS  ENDED  JUNE  30,  2003,  2002  AND  2001
(U.S.  DOLLARS)

================================================================================

11.  COMPREHENSIVE  LOSS

<TABLE>
<CAPTION>
     ===========================================================================
                                                                   PERIOD FROM
                                                                  FEBRUARY 12,
                                                                      1996
                                                                   (INCEPTION)
                                                                     THROUGH
                           2003          2002          2001       JUNE 30, 2003
     ---------------------------------------------------------------------------
<S>                    <C>           <C>           <C>           <C>
     Net loss          $(1,346,833)  $(3,836,191)  $(4,000,169)  $  (14,229,049)
     Other
       comprehensive
       Income (loss)             0             0           (26)          46,267
     ---------------------------------------------------------------------------

     Comprehensive
       Loss            $(1,346,833)  $(3,836,191)  $(4,000,195)  $  (14,182,782)
     ===========================================================================
</TABLE>


                                       F-25
<PAGE>
                                    PART III

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

Directors  and  Executive  Officers  of  Registrant.  The Company has a Board of
Directors  which  is  currently  comprised  of two members.  Each director holds
office  until  the  next  annual meeting of shareholders or until a successor is
elected  or  appointed.  The  members of the Board and the executive officers of
the  Company  and  their  respective  age  and  position  are  as  follows:

<TABLE>
<CAPTION>
                                                                      Director of
Name                 Age          Position with Registrant          Registrant Since
------------------------------------------------------------------------------------
<S>                  <C>  <C>                                       <C>
William S. Robinson   46  Chairman, CEO and Treasurer               February 1996

William A. Ince       52  Director, President, Secretary and Chief  February 1996
                          Financial Officer
</TABLE>


                  DIRECTORS AND EXECUTIVE OFFICERS OF INTEGRAL

WILLIAM ROBINSON
(Chairman, CEO and Treasurer)

As  a  co-founder of the Company (since 1996), Mr. Robinson has been responsible
since  the  inception  of  Integral  for securing funding in order to ensure the
ongoing operations of Integral and its subsidiaries.  Together with Mr. Ince, he
has  been  responsible  for  the  development  and  implementation  of corporate
strategies.

Mr.  Robinson brings many years of management experience in finance, banking and
corporate  development.  Previously,  he  acted  as  a  director  of a number of
companies  involved  in  natural  resources,  sales  and marketing, and computer
technologies.

WILLIAM  A.  INCE
(Director,  President,  Secretary  and  Chief  Financial  Officer)

Mr.  Ince,  a co-founder of the Company (since 1996), is responsible, along with
Mr.  Robinson,  for  the development and implementation of corporate strategies.
He  is  also  responsible  for  the  accounting  and  financial  systems  and
record-keeping  of  Integral  and  its  subsidiaries.

Mr.  Ince  brings  with  him  a  background  as  a  professional  accountant and
experience  from  management  positions  in  finance  and  operations in several
private companies.  He has consulted to both private and public companies in the
areas of marketing and finance, as well as turn-around situations.  Mr. Ince has
been  responsible  for  "team  building"  efforts to ensure that each project is
brought  to  fruition  on  a  timely  basis.


                                       10
<PAGE>
SIGNIFICANT  EMPLOYEES  OF  THE  COMPANY  AND  ITS  SUBSIDIARIES

TOM  AISENBREY,  General Manager and Chief Technology Officer, has been with the
Company since February 2001.  Mr. Aisenbrey is an accomplished executive program
manager  with 27 years of experience in a variety of electronic industries, with
design  &  development  of  multiple computer oriented products, specializing in
wireless  products.  Mr.  Aisenbrey  is  responsible  for the development of the
Company's  antenna  technologies.


SECTION  16(A)  BENEFICIAL  OWNERSHIP  REPORTING  COMPLIANCE

     Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers  and directors, and persons who own more than 10% of a registered class
of  the Company's equity securities, to file reports of ownership and changes in
ownership  with  the  Securities  and  Exchange  Commission  ("SEC").  Officers,
directors,  and  greater than 10% shareholders are required by SEC regulation to
furnish  the  Company  with  copies of all Section 16(a) forms they file.  Based
solely  on  its  review  of  copies  of  such  reports  received  or  written
representations  from  certain  reporting  persons,  the  Company believes that,
during  the  year  ended  June  30,  2003, all Section 16(a) filing requirements
applicable to its officers, directors and ten percent shareholders were complied
with  by  such  persons.


ITEM  10.  EXECUTIVE  COMPENSATION.
-----------------------------------

(a)  General

     The  following  information  discloses  all  plan and non-plan compensation
awarded  to,  earned  by,  or paid to the executive officers of the Company, and
other  individuals for whom disclosure is required, for all services rendered in
all  capacities  to  the  Company  and  its  subsidiaries.

(b)  Summary  Compensation  Table

     The  following  table sets forth all compensation, including bonuses, stock
option  awards  and  other  payments,  paid  or  accrued  by Integral and/or its
subsidiaries, to or for Integral's Chief Executive Officer and each of the other
executive  officers  of  Integral,  during the fiscal years ended June 30, 2003,
2002  and  2001.

<TABLE>
<CAPTION>
                                           Annual Compensation
                                     --------------------------------
          (a)                (b)       (c)        (d)        (e)
          Name                                              Other
          And                Year                           Annual
        Principal           Ended     Salary     Bonus   Compensation
        Position           June 30     ($)        ($)         ($)
---------------------------------------------------------------------
<S>                        <C>       <C>        <C>     <C>
William S. Robinson,           2003  $ 170,000     -0-            -0-
Director, Chairman, CEO,       2002  $ 156,000     -0-            -0-
Treasurer (n1)                 2001  $ 138,000     -0-            -0-

William A. Ince,               2003  $ 170,000     -0-            -0-
Director, President,           2002  $ 156,000     -0-            -0-
Secretary, CFO (n2)            2001  $ 138,000     -0-            -0-
</TABLE>


                                       11
<PAGE>
<TABLE>
<CAPTION>
                                                          Long Term Compensation
                                                    -----------------------------------
                                                          Awards             Payouts
                                                    -----------------------------------
(a)                                         (b)         (f)          (g)        (h)          (i)
Name                                                Restricted
And                                         Year       Stock       Shares       LTIP      All Other
Principal                                  Ended     Award(s)    Underlying   Payouts    Compensation
Position                                  June 30       ($)        Options      ($)          ($)
-----------------------------------------------------------------------------------------------------
<S>                                       <C>       <C>          <C>          <C>       <C>
William S. Robinson,
Chairman, CEO, Treasurer (n1)                2003          -0-      415,000       -0-            -0-
                                             2002          -0-          -0-       -0-  $  93,600 (n3)
                                             2001          -0-      240,000       -0-  $  50,000 (n4)

William A. Ince,
Director, President, Secretary, CFO (n2)     2003          -0-      415,000       -0-            -0-
                                             2002          -0-          -0-       -0-  $  93,600 (n3)
                                             2001          -0-      240,000       -0-  $  50,000 (n4)
<FN>
     (n1) As  of  June 30, 2003, of the $170,000 salary earned for the year then
          ended,  the  Company  owed  Mr.  Robinson  $103,275  of this amount as
          accrued  but  unpaid  salary  for  the  year  then  ended.

     (n2) As  of  June 30, 2003, of the $170,000 salary earned for the year then
          ended,  the  Company  owed Mr. Ince $127,375 of this amount as accrued
          but  unpaid  salary  for  the  year  then  ended.

     (n3) In  March 2002, the Company redeemed an aggregate of 124,800 shares of
          Series  A  Preferred  Stock  from Mr. Robinson (62,400 shares) and Mr.
          Ince  (62,400 shares) at a predetermined redemption price of $2.50 per
          share.  The  stated value of the Series A Preferred Stock is $1.00 per
          share,  which resulted in a redemption premium of $1.50 per share over
          the  stated  value.

     (n4) In  December 2000, the Company redeemed an aggregate of 100,000 shares
          of  Series A Preferred Stock from Mr. Robinson (50,000 shares) and Mr.
          Ince  (50,000 shares) at a predetermined redemption price of $2.00 per
          share.  The  stated value of the Series A Preferred Stock is $1.00 per
          share,  which resulted in a redemption premium of $1.00 per share over
          the  stated  value.
</TABLE>

(c)  Option/SAR  Grants  in  Last  Fiscal  Year

     The  information  provided  in  the  table  below provides information with
respect  to  individual grants of stock options for the year ended June 30, 2003
to  each of the persons named in the Summary Compensation Table above.  Integral
did  not  grant  any stock appreciation rights for the year ended June 30, 2003.


                                       12
<PAGE>
<TABLE>
<CAPTION>
                         OPTION/SAR GRANTS IN LAST FISCAL YEAR

                                  Individual Grants

           (a)                    (b)            (c)            (d)           (e)
                                             % of Total
                               Number of    Options/SARS
                              Securities     Granted to
                              Underlying      Employees     Exercise or
                             Options/SARs     in Fiscal     Base Price    Expiration
           Name               Granted (#)     Year (n1)       ($/Sh)         Date
-------------------------------------------------------------------------------------
<S>                          <C>            <C>            <C>            <C>
William S. Robinson,          415,000 (n2)            34%  $        1.00   12/31/2005
Chairman, CEO, Treasurer

William A. Ince, Director,    415,000 (n3)            34%  $        1.00   12/31/2005
President, Secretary, CFO
<FN>
     (n1) The percentage of total options granted (1,230,000) in the fiscal year
          is  based  upon  all  options  granted to eligible participants, which
          includes  officers,  directors,  employees,  consultants and advisors,
          under  Integral's 2001 Stock Plan during the year ended June 30, 2003.

     (n2) William S. Robinson: On July 1, 2002, Mr. Robinson was granted 415,000
          options  under  Integral's  2001  Stock  Plan.

     (n3) William A. Ince: On July 1, 2002, Mr. Ince was granted 415,000 options
          under  Integral's  2001  Stock  Plan.
</TABLE>

(d)  Aggregated  Option/SAR  Exercises  in  Last Fiscal Year and Fiscal Year-End
     Option/SAR  Values

     The  information  provided  in  the  table  below provides information with
respect  to  each exercise of stock options during most recent fiscal year ended
June  30,  2003  by  the persons named in the Summary Compensation Table and the
fiscal  year  end  value  of  unexercised  options.

<TABLE>
<CAPTION>
         (a)               (b)          (c)              (d)                   (e)
                                                      Number of             Value of
                                                Securities Underlying      Unexercised
                                                     Unexercised          In-the-Money
                                                   Options/SARs at       Options/SARs at
                          Shares       Value          FY-End (#)            FY-End($)
                       Acquired on   Realized        Exercisable/         Exercisable/
        Name           Exercise (#)   ($)(n1)       Unexercisable       Unexercisable(n1)
-----------------------------------------------------------------------------------------
<S>                    <C>           <C>        <C>                     <C>
William S. Robinson             -0-       N/A              415,000/-0-            -0-/-0-
Director, Chairman,
CEO, Treasurer

William A. Ince                 -0-       N/A              415,000/-0-            -0-/-0-
Director, President,
Secretary, CFO


                                       13
<PAGE>
<FN>
     (n1)  The  aggregate  dollar  values  in  columns  (c)  and  (e)  are  calculated by
determining  the  difference between the fair market value of the common stock underlying
the  options  and  the  exercise  price  of  the  options at exercise or fiscal year end,
respectively.   At  June  30,  2003,  all  options held by Messrs. Robinson and Ince were
out-of-the money (the exercise price of $1.00 was greater than the market price of $.82).
</TABLE>

(e)  Long-Term  Incentive  Plans  ("LTIP")  -  Awards  in  Last  Fiscal  Year

     This  table has been omitted, as no executive officers named in the Summary
Compensation  Table  above  received  any awards pursuant to any LTIP during the
fiscal  year  ended  June  30,  2003.

(f)  Compensation of Directors

     No  compensation  was  paid  by  Integral  to its Directors for any service
provided as a Director during the fiscal year ended June 30, 2003.  There are no
other  formal  or  informal  understandings  or  arrangements  relating  to
compensation;  however,  Directors may be reimbursed for all reasonable expenses
incurred  by  them  in  conducting  Integral's  business.  These  expenses would
include out-of-pocket expenses for such items as travel, telephone, and postage.

(g)  Employment  Contracts  and  Termination of Employment and Change-in-Control
     Arrangements

     On  July  1, 2002, Integral executed new employment agreements with William
S.  Robinson, the Chairman, CEO and Treasurer of Integral and William A. Ince, a
director  and  the  President,  Secretary  and CFO of Integral.  Each employment
agreement  provides  for  a  two  year  term,  an  annual salary of $170,000 and
fully-vested options to purchase 415,000 shares of Integral's common stock at an
exercise  price of $1.00 per share, which are exercisable after January 1, 2003.

     Pursuant to the employment agreements, in the event Integral terminates the
employment  of the executive without cause, then the executive shall be entitled
to  severance  pay  equal to twelve month's base salary based on the base salary
then  in  effect  at  the  termination.  In  addition, the employment agreements
provide that in the event Integral is indebted to the executive for a minimum of
three  months salary, the executive shall have the option to convert such unpaid
salary  into  shares  of common stock of Integral at market price (average daily
closing  over  the  previous  month).

     Integral's  Board  of  Directors  has  complete  discretion  as  to  the
appropriateness  of  (a)  key-man  life  insurance,  (b)  obtaining  officer and
director  liability insurance, (c) employment contracts with and compensation of
executive  officers  and  directors,  (d)  indemnification  contracts,  and  (e)
incentive  plan  to  award  executive  officers  and  key  employees.

     Integral's  Board of Directors is responsible for reviewing and determining
the  annual  salary  and  other  compensation  of the executive officers and key
employees  of  Integral.  The  goals  of Integral are to align compensation with
business  objectives  and  performance and to enable Integral to attract, retain
and  reward  executive  officers  and  other key employees who contribute to the
long-term success of Integral.  Integral intends to provide base salaries to its
executive officers and key employees sufficient to provide motivation to achieve
certain  operating  goals.  Although  salaries  are  not  specifically tied into
performance,  incentive  bonuses  may be available to certain executive officers
and  key  employees.  In  the future, executive compensation may include without
limitation  cash  bonuses,  stock  option  grants  and  stock  reward  grants.


                                       14
<PAGE>
(h)  Employee  Benefit  and  Consulting  Services  Compensation  Plans

     As  of  June  30,  2002,  Integral  had two Employee Benefit and Consulting
Services  Compensation  Plans  in  effect.

     On  January  2,  2001,  Integral adopted an employee benefit and consulting
services  compensation  plan entitled the Integral Technologies, Inc. 2001 Stock
Plan (the "2001 Plan"), which was amended on December 17, 2001.  As amended, the
2001  Plan covers up to 3,500,000 shares of common stock.  The 2001 Plan has not
previously  been  approved  by  security  holders.

     On  April  4,  2003,  Integral  adopted  an employee benefit and consulting
services  compensation  plan entitled the Integral Technologies, Inc. 2003 Stock
Plan  (the  "2003  Plan).  The 2003 Plan covers up to 1,500,000 shares of common
stock.  The  2003  Plan  has  not  previously been approved by security holders.

     Under  both  Plans,  Integral  may  issue  common  stock  and/or options to
purchase  common  stock  to  certain  officers,  directors  and  employees  and
consultants  of  Integral  and its subsidiaries.  The purpose of the Plans is to
promote the best interests of Integral and its shareholders by providing a means
of  non-cash  remuneration  to eligible participants who contribute to operating
progress  and  earning  power  of  Integral.  The  Plans  are  administered  by
Integral's Board of Directors or a committee thereof which has the discretion to
determine  from  time to time the eligible participants to receive an award; the
number of shares of stock issuable directly or to be granted pursuant to option;
the price at which the option may be exercised or the price per share in cash or
cancellation  of  fees  or  other  payment which Integral or its subsidiaries is
liable if a direct issue of stock and all other terms on which each option shall
be  granted.


                                       15
<PAGE>
ITEM  11.  SECURITY  OWNERSHIP  OF  CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
--------------------------------------------------------------------------------
RELATED  STOCKHOLDER  MATTERS..
-------------------------------

A.   Common  Stock

     The  following  table  sets  forth,  as  of  September  25,  2003 the stock
ownership  of  each  person known by Integral to be the beneficial owner of five
percent  or  more  of  Integral's  common  stock,  each  Officer  and  Director
individually and all Directors and Officers of Integral as a group.  Each person
is  believed  to have sole voting and investment power over the shares except as
noted.

<TABLE>
<CAPTION>
====================================================================================================
Name and Address of                           Amount and Nature of Beneficial
Beneficial Owner (1)                                  Ownership(1)(2)           Percent of Class (3)
----------------------------------------------------------------------------------------------------
<S>                                           <C>                               <C>
William S. Robinson (4)
#3 1070 West Pender St.                                              2,373,533                  7.0%
Vancouver, B.C.  V6E 2N7
----------------------------------------------------------------------------------------------------
William A. Ince (5)
805 W. Orchard Dr., Suite #3                                         2,188,833                  6.4%
 Bellingham, WA  98225
----------------------------------------------------------------------------------------------------
James Smith
Route 4, Box E36                                                     1,857,140                  5.5%
 Bruceton Mills, WV  26330
====================================================================================================
All officers and directors of Integral as a
group (2 persons)                                                    4,562,366                 13.2%
====================================================================================================
<FN>
(1)  Unless  otherwise indicated, all shares are directly beneficially owned and
     investing  power  is  held  by  the  persons  named.

(2)  Includes  vested  options  beneficially  owned  but  not  yet exercised and
     outstanding,  if  any. The table does not include the effects of conversion
     by  Mr.  Robinson  and  Mr.  Ince  of  their shares of Series A Convertible
     Preferred  Stock  ("Series A"), which are convertible into shares of common
     stock  at a conversion rate that varies with the market price of the common
     stock  at  the  time  of  conversion.  The conversion rate is determined by
     dividing the number of shares of Series A being converted by the average of
     the  high and low bid prices of Integral's common stock reported by the OTC
     Bulletin  Board over the ten trading days preceding the date of conversion.
     Mr.  Robinson  owns  329,797  shares  of Series A and Mr. Ince owns 109,813
     shares of Series A. As of September 25, 2003, the conversion rate was $1.09
     per  share,  so  Mr. Robinson's 329,797 shares of Series A were convertible
     into  302,566  shares  of  common  stock,  and Mr. Ince's 109,813 shares of
     Series  A  were convertible into 100,746 shares of common stock. The actual
     number  of  shares  of common stock receivable by Messrs. Robinson and Ince
     upon  conversion of the Series A would depend on the actual conversion rate
     in  effect  at  the  time  of  conversion.

(3)  Based  upon  33,717,551  shares  issued and outstanding, plus the amount of
     shares  each  person  or  group  has  the  right  to acquire within 60 days
     pursuant  to  options,  warrants,  conversion  privileges  or other rights.

(4)  Mr.  Robinson  is  an  officer  and  director  of  Integral and each of its
     subsidiaries.  Beneficial  ownership  figure  includes  415,000  shares
     underlying  options.

(5)  Mr.  Ince  is  an  officer  and  director  of  Integral  and  each  of  its
     subsidiaries.  Beneficial  ownership  figure  includes  415,000  shares
     underlying  options.
</TABLE>


                                       16
<PAGE>
B.   Series  A  Convertible  Preferred  Stock

     The  following  table  sets  forth,  as  of  September  25, 2003, the stock
ownership  of  each  person known by Integral to be the beneficial owner of five
percent or more of Integral's Series A Convertible Preferred Stock, each Officer
and Director individually and all Directors and Officers of Integral as a group.
Each person is believed to have sole voting and investment power over the shares
except  as  noted.

<TABLE>
<CAPTION>
===========================================================================================
Name and Address of                            Amount and Nature of
Beneficial Owner (1)                          Beneficial Ownership(1)  Percent of Class (2)
-------------------------------------------------------------------------------------------
<S>                                           <C>                      <C>
William S. Robinson (3)
#3 1070 West Pender St.                                       329,797                   75%
Vancouver, B.C.  V6E 2N7
-------------------------------------------------------------------------------------------
William A. Ince (4
805 W. Orchard Dr., Suite #3                                  109,813                   25%
Bellingham, WA  98225
===========================================================================================
All officers and directors of Integral as a
group (2 persons)                                             439,610                  100%
===========================================================================================
<FN>
(1)  Unless  otherwise indicated, all shares are directly beneficially owned and
     investing  power  is  held  by  the  persons  named.

(2)  Based  upon  439,610  Series  A  Convertible  Preferred  shares  issued and
     outstanding.

(3)  Mr.  Robinson  is  an  officer  and  director  of  Integral and each of its
     subsidiaries.

(4)  Mr.  Ince  is  an  officer  and  director  of  Integral  and  each  of  its
     subsidiaries.
</TABLE>


EQUITY COMPENSATION PLAN INFORMATION

     The following information concerning the Company's equity compensation
plans is as of the end of the fiscal year ended June 30, 2003:

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------
                           Number of securities to be         Weighted-average             Number of securities
                             issued upon exercise of     exercise price of options,   available for future issuance
                              outstanding options,          warrants and rights         under equity compensation
                               warrants and rights                                     plans (excluding securities
                                                                                         reflected in column (a))

                                       (a)                          (b)                            (c)
Plan category
--------------------------------------------------------------------------------------------------------------------
<S>                        <C>                          <C>                           <C>

Equity compensation plans
approved by security
holders                    N/A                          N/A                           N/A
--------------------------------------------------------------------------------------------------------------------
Equity compensation plans
not approved by security
holders                    1,907,500                    $0.94                          1,687,500
--------------------------------------------------------------------------------------------------------------------

Total                      1,907,500                    $0.94                          1,687,500
--------------------------------------------------------------------------------------------------------------------
</TABLE>


                                       17
<PAGE>
     As  of  June  30,  2002,  Integral  had two Employee Benefit and Consulting
Services  Compensation  Plans  in  effect.

     On  January  2,  2001,  Integral adopted an employee benefit and consulting
services  compensation  plan entitled the Integral Technologies, Inc. 2001 Stock
Plan (the "2001 Plan"), which was amended on December 17, 2001.  As amended, the
2001  Plan covers up to 3,500,000 shares of common stock.  The 2001 Plan has not
previously  been  approved  by  security  holders.

     On  April  4,  2003,  Integral  adopted  an employee benefit and consulting
services  compensation  plan entitled the Integral Technologies, Inc. 2003 Stock
Plan  (the  "2003  Plan).  The 2003 Plan covers up to 1,500,000 shares of common
stock.  The  2003  Plan  has  not  previously been approved by security holders.

     Under  both  Plans,  Integral  may  issue  common  stock  and/or options to
purchase  common  stock  to  certain  officers,  directors  and  employees  and
consultants  of  Integral  and its subsidiaries.  The purpose of the Plans is to
promote the best interests of Integral and its shareholders by providing a means
of  non-cash  remuneration  to eligible participants who contribute to operating
progress  and  earning  power  of  Integral.  The  Plans  are  administered  by
Integral's Board of Directors or a committee thereof which has the discretion to
determine  from  time to time the eligible participants to receive an award; the
number of shares of stock issuable directly or to be granted pursuant to option;
the price at which the option may be exercised or the price per share in cash or
cancellation  of  fees  or  other  payment which Integral or its subsidiaries is
liable if a direct issue of stock and all other terms on which each option shall
be  granted.

ITEM  12.  CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS.
--------------------------------------------------------------

     During  the  last  two fiscal years, the company entered into the following
transactions  in  with  its  officers  and  directors  have a material interest:

(a)  In  August  2001,  the Company issued an aggregate of 700,000 shares of its
common  stock  to Mr. Robinson (350,000) and Mr. Ince (350,000) upon exercise of
options  pursuant  to  the Employee Benefit and Consulting Services Compensation
Plan.  The  options  had exercise prices of $0.15 to $.23 per share. The Company
issued  the  shares in consideration for a reduction of an aggregate of $124,200
of accrued salaries payable ($62,100 for Mr. Robinson and $62,100 for Mr. Ince).

(b)  In  March  2002,  the  Company  redeemed  an aggregate of 124,800 shares of
Series  A Preferred Stock from Mr. Robinson (62,400 shares) and Mr. Ince (62,400
shares)  at  a  predetermined  redemption  price of $2.50 per share.  The stated
value  of  the  Series A Preferred Stock is $1.00 per share, which resulted in a
redemption  premium  of  $1.50  per  share  over  the  stated  value.

(c)  A 5% dividend on the Series A Preferred Stock, payable in cash or shares of
common  stock at the election of the Company, has been accrued but not paid.  As
of the year ended June 30, 2003, $72,513 was accrued to Mr. Robinson and $32,268
was  accrued  to  Mr.  Ince.

                                       18
<PAGE>
ITEM  13.  EXHIBITS  AND  REPORTS  ON  FORM  8-K.
-------------------------------------------------

(a)  List  of  Exhibits.

<TABLE>
<CAPTION>
Exhibit No.  Description
-----------  -----------
<C>          <S>

3.1          Articles of Incorporation, as amended and currently in effect.  (Incorporated by reference to Exhibit 3.1
             of Integral's registration statement on Form 10-SB (file no. 0-28353) filed December 2, 1999.)

3.2          Bylaws, as amended and restated on December 31, 1997.  (Incorporated by reference to Exhibit 3.2 of
             Integral's registration statement on Form 10-SB (file no. 0-28353) filed December 2, 1999.)

4.3          Investment Agreement dated May 11, 2000, by and between Integral and Swartz Private Equity, LLC.
             (Incorporated by reference to Exhibit 4.3 of Integral's registration statement on Form SB-2 (file no.
             333-41938) filed July 21, 2000.)

4.4          Warrant to purchase common stock issued to Swartz on May 11, 2000, exercisable to purchase an
             aggregate of 495,000 shares of common stock granted to Swartz in connection with the offering of
             securities described in Exhibit 4.3.  (Incorporated by reference to Exhibit 4.4 of Integral's registration
             statement on Form SB-2 (file no. 333-41938) filed July 21, 2000.)

4.5          Registration Rights Agreement, dated May 11, 2000, by and between Integral and Swartz related to the
             offering of securities described in Exhibit 4.3.  (Incorporated by reference to Exhibit 4.5 of Integral's
             registration statement on Form SB-2 (file no. 333-41938) filed July 21, 2000.)

4.6          Warrant to Purchase Common Stock issued from time to time in connection with the offering of
             securities described in Exhibit 4.3.  (Incorporated by reference to Exhibit 4.6 of Integral's registration
             statement on Form SB-2 (file no. 333-41938) filed July 21, 2000.)

4.7          Warrant Side Agreement dated May 11, 2000 between Integral and Swartz related to the offering of
             securities described in Exhibit 4.3.  (Incorporated by reference to Exhibit 4.7 of Integral's registration
             statement on Form SB-2 (file no.  333-41938) filed July 21, 2000.)

10.12        Integral Technologies, Inc. 2001 Stock Plan dated January 2, 2001, as amended December 17, 2001.
             (Incorporated by reference to Exhibit 10.12 of Integral's registration statement on Form S-8 (file no.
             333-76058).)

10.13        Employment Agreement between Integral and William S. Robinson dated July 1, 2002.  (Incorporated
             by reference to Exhibit 10.13 of Integral's Annual Report on Form 10-KSB for the fiscal year ended
             June 30, 2002.)

10.14        Employment Agreement between Integral and William A. Ince dated July 1, 2002. (Incorporated by
             reference to Exhibit 10.13 of Integral's Annual Report on Form 10-KSB for the fiscal year ended June
             30, 2002.)

21.3         List of Subsidiaries. (Incorporated by reference to Exhibit 21.3 of Integral's Annual Report on Form
             10-KSB for the fiscal year ended June 30, 2001.)

31.1         Section 302 Certification by the Corporation's Chief Executive Officer.  (Filed herewith).

31.2         Section 302 Certification by the Corporation's Chief Financial Officer.  (Filed herewith).

32.1         Section 906 Certification by the Corporation's Chief Executive Officer.  (Filed herewith).

32.2         Section 906 Certification by the Corporation's Chief Financial Officer.  (Filed herewith).
</TABLE>


                                       19
<PAGE>
(b)  Reports  on  Form  8-K.

     No  current  reports  on Form 8-K were filed during the last quarter of the
fiscal  year  ended  June  30,  2003.


ITEM 14.  CONTROLS AND PROCEDURES
---------------------------------

Based on their most recent evaluation, which was completed as of the end of the
period covered by this periodic report on Form 10-KSB, the Company's Chief
Executive Officer and Chief Financial Officer believe the Company's disclosure
controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) are
effective to ensure that information required to be disclosed by the Company in
this report is accumulated and communicated to the Company's management,
including its principal executive officer and principal financial officer, as
appropriate, to allow timely decisions regarding required disclosure. During the
last fiscal quarter to which this report relates, there were no significant
changes in the Company's internal controls or other factors that could
significantly affect these controls subsequent to the date of their evaluation
and there were no corrective actions with regard to significant deficiencies and
material weaknesses.


                                       20
<PAGE>
                                   SIGNATURES
                                   ----------

     In  accordance  with  Section 13 or 15(d) of the Securities Exchange Act of
1934,  as  amended, the Registrant caused this Report to be signed on its behalf
by  the  undersigned,  thereunto  duly  authorized.

                                   INTEGRAL TECHNOLOGIES, INC


Dated:  September 29, 2003         /s/ William S. Robinson
                                   ---------------------------------------------
                                   William S. Robinson, Chief Executive Officer

                                   /s/ William A. Ince
                                   ---------------------------------------------
                                   William A. Ince, Chief Financial Officer


     Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, this Report has been signed below by the following persons on behalf of
the Registrant and in the capacities and on the dates indicated.

     Name                         Title                       Date
     ----                         -----                       ----

/s/ William S. Robinson   Director, Chief Executive Officer   September 29, 2003
-----------------------
William S. Robinson

/s/ William A. Ince       Director, Chief Financial Officer   September 29, 2003
-----------------------
William A. Ince


                                       21
<PAGE>
<TABLE>
<CAPTION>
                                                       EXHIBIT INDEX



Exhibit No.  Description
-----------  -----------------------------------------------------------------------------------------------------------
<C>          <S>

3.1          Articles of Incorporation, as amended and currently in effect.  (Incorporated by reference to Exhibit 3.1
             of Integral's registration statement on Form 10-SB (file no. 0-28353) filed December 2, 1999.)

3.2          Bylaws, as amended and restated on December 31, 1997.  (Incorporated by reference to Exhibit 3.2 of
             Integral's registration statement on Form 10-SB (file no. 0-28353) filed December 2, 1999.)

4.3          Investment Agreement dated May 11, 2000, by and between Integral and Swartz Private Equity, LLC.
             (Incorporated by reference to Exhibit 4.3 of Integral's registration statement on Form SB-2 (file no.
             333-41938) filed July 21, 2000.)

4.4          Warrant to purchase common stock issued to Swartz on May 11, 2000, exercisable to purchase an
             aggregate of 495,000 shares of common stock granted to Swartz in connection with the offering of
             securities described in Exhibit 4.3.  (Incorporated by reference to Exhibit 4.4 of Integral's registration
             statement on Form SB-2 (file no. 333-41938) filed July 21, 2000.)

4.5          Registration Rights Agreement, dated May 11, 2000, by and between Integral and Swartz related to the
             offering of securities described in Exhibit 4.3.  (Incorporated by reference to Exhibit 4.5 of Integral's
             registration statement on Form SB-2 (file no. 333-41938) filed July 21, 2000.)

4.6          Warrant to Purchase Common Stock issued from time to time in connection with the offering of
             securities described in Exhibit 4.3.  (Incorporated by reference to Exhibit 4.6 of Integral's registration
             statement on Form SB-2 (file no. 333-41938) filed July 21, 2000.)

4.7          Warrant Side Agreement dated May 11, 2000 between Integral and Swartz related to the offering of
             securities described in Exhibit 4.3.  (Incorporated by reference to Exhibit 4.7 of Integral's registration
             statement on Form SB-2 (file no.  333-41938) filed July 21, 2000.)

10.12        Integral Technologies, Inc. 2001 Stock Plan dated January 2, 2001, as amended December 17, 2001.
             (Incorporated by reference to Exhibit 10.12 of Integral's registration statement on Form S-8 (file no.
             333-76058).)

10.13        Employment Agreement between Integral and William S. Robinson dated July 1, 2002.  (Incorporated
             by reference to Exhibit 10.13 of Integral's Annual Report on Form 10-KSB for the fiscal year ended
             June 30, 2002.)

10.14        Employment Agreement between Integral and William A. Ince dated July 1, 2002. (Incorporated by
             reference to Exhibit 10.13 of Integral's Annual Report on Form 10-KSB for the fiscal year ended June
             30, 2002.)

21.3         List of Subsidiaries. (Incorporated by reference to Exhibit 21.3 of Integral's Annual Report on Form
             10-KSB for the fiscal year ended June 30, 2001.)

31.1         Section 302 Certification by the Corporation's Chief Executive Officer.  (Filed herewith).

31.2         Section 302 Certification by the Corporation's Chief Financial Officer.  (Filed herewith).

32.1         Section 906 Certification by the Corporation's Chief Executive Officer.  (Filed herewith).

32.2         Section 906 Certification by the Corporation's Chief Financial Officer.  (Filed herewith).
</TABLE>


<PAGE>