FILER:

COMPANY DATA:
COMPANY CONFORMED NAME:             ASI ENTERTAINMENT INC
CENTRAL INDEX KEY:                  0001067873
STANDARD INDUSTRIAL CLASSIFICATION: AIRCRAFT PART & AUXILIARY EQUIPMENT
                                             NEC [3728]
IRS NUMBER:                         522101695
STATE OF INCORPORATION:             DE
FISCAL YEAR END:                    0630

FILING VALUES:
FORM TYPE:        10KSB
SEC ACT:
SEC FILE NUMBER:  000-27881
FILM NUMBER:      99766951

BUSINESS ADDRESS:
STREET 1:         15200 EAST GIRARD AVENUE
STREET 2:         STE 3000
CITY:             AURORA
STATE:            CO
ZIP:              80014
BUSINESS PHONE:   970 881 3573

MAIL ADDRESS:
STREET 1:         79 TAMI ROAD
STREET 2:
CITY:             RED FEATHER LAKES
STATE:            CO
ZIP:              80545




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

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-KSB
(Mark One)

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

        For the fiscal year ended June 30, 2003
                                       OR

[ ]     TRANSITION REPORT PURSUANT TO SECTION 13 OR  15(d) OF THE SECURITIES
        EXCHANGE ACT OF 1934

        For the transition period from ___________ to ___________

                         Commission file number 0-27881

                             ASI ENTERTAINMENT, INC.
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)

             Delaware                                     52-2101695
- - ----------------------------------           -----------------------------
(State or other jurisdiction              (I.R.S. Employer Identification No.)
of incorporation or organization)

                          Ronald J. Chapman, President
                             1\12, Candlebark Court
                       Research, Victoria, 3095 Australia
               ---------------------------------------------------
               (Address of principal executive offices) (zip code)

                                 +61 3 9437 1233
                           --------------------------
                           Issuer's Telephone Number:

   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 last 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

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

State issuer's revenues for its most recent fiscal year.   $50,100

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


<PAGE>



State the aggregate market value of the voting and non-voting common equity
held by non-affiliates computed by reference to the price at which the common
equity was sold, or the average bid and asked price of such common equity, as
of a specified date within the past 60 days.

State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date.

Class                                           Outstanding at June 30, 2003;

Common Stock, par value $.0001 per share                   11,811,227
                                                -----------------------------
Documents incorporated by reference:        None


<PAGE>



10KSB
<TABLE>

<S>
<C>
PART I........................................................................2

ITEM 1. DESCRIPTION OF BUSINESS...............................................2

ITEM 2. DESCRIPTION OF PROPERTY...............................................8

ITEM 3. LEGAL PROCEEDINGS.....................................................8

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS...................8

PART II. .....................................................................8

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS .............8

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.............9

ITEM 7. FINANCIAL STATEMENTS.................................................11

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
    FINANCIAL DISCLOSURE.....................................................12

PART III.....................................................................12

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
    COMPLIANCE WITH SECTION 16(A)OF THE EXCHANGE ACT.........................12

ITEM 10. EXECUTIVE COMPENSATION.. ...........................................14

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT......14

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS......................17

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


</TABLE>


                                      -1-
<PAGE>

PART I

ITEM 1. DESCRIPTION OF BUSINESS.

THE COMPANY

ASI Entertainment has an authorized capitalization of 100,000,000 shares of
Common Stock, par value of $.0001 per share (the "Common Stock") and
20,000,000 shares of preferred stock, par value $.0001 per share. The main
offices of the Company are located at 1/12 Candlebark Court,
Research, Victoria, 3095 Australia and its telephone number is +61-3-9437-1028
and fax number is +61-3-9437-1299. The United States offices of the Company are
located at 15200 East Girard Avenue, Suite 3000 Aurora, Colorado 80014.

BUSINESS

1. Overview

ASI has spent over a decade developing its expertise and reputation in both
software development and airline industry technologies, as a pioneer of
passenger data communications.  The core of ASI's intellectual property is
software which has evolved over years of flight-testing and commercial
operation. The hardware platform is also unique as it enabled ASI to pioneer
the passenger data link with major international airlines and was used as the
development platform by INMARSAT, the monopoly satellite service provider for
aircraft.

Increasing use of Email for both business and personal communications, and
airline passengers identifying Email as a service they want access to while
in flight, created the opportunity for ASI to capitalize on the airline
communications and E Commerce markets with two unique software programs:

    1. Data3Mail, an airline Emailing system.

    2. AirCommerce, an in-flight web based E Commerce application previously
       designated as ASI-9000.

In August 2001, ASI acquired the marketing and manufacturing rights of
the SecurEtag package tracking technology.  The rights cover both North and
South America and Europe.

2. Data3Mail

Data3Mail, is based on ASI's existing flight proven hardware and software
platform, the SIU (Server Interface Unit), which has been developed and flight
tested in conjunction with INMARSAT  and SITA (the major providers of
satellite communications and ground based infrastructure for the airline
industry). With Data3Mail onboard, passengers can send an Email using their
existing Email software and access their Email while in-flight. The system is
designed to accommodate all laptops operating under Windows and Macintosh
platforms, including Windows 3.1, 95, 98, 2000 X/P and Mac System OS 7 to OS X.

To send an email is now affordable, as the passenger's will only be charged
for the actual amount of data transmitted and there are no subscription fees.
For as little as $1.00, passengers can access their email. The software

                                      -2-
<PAGE>

displays the cost of the Email prior to sending, and passengers have the
option to decide which Emails should be delivered to the aircraft. The central
server automatically bills the transactions direct to a credit card and a
pre-paid Data3Mail account can also be established for frequent flyers. The
reason passengers will select Data3Mail is that it is based on existing
software, using their normal Email address. Installation is simple, and it
does not interfere with the normal Email settings.

3. AirCommerce

The AirCommerce program has evolved from the original ASI-9000 concept into a
web based application offering in-flight E Commerce.  The AirCommerce system
provides destination specific, cached web capable content, to passengers in
their seats.  The passengers dial up the Network Server Unit (NSU) from their
laptop and can then navigate to pages of interest using their favorite web
browser. Sponsors and advertisers underwrite the cost of the program and the
surplus revenue is shared between ASI and the airline.

Air Commerce is a template based software module that can be certified for
installation on an aircraft server. The software allows an airline to build a
database of products and services and incorporate destination based
entertainment and information in an interactive web presentation format.

4. SecurEtag

The SecurEtag system integrates radio frequency identification (RFID),
global positioning system (GPS) and cellular technologies (GSM/CDMA) to
facilitate the tracking and location of packages in either mobile or warehouse
environments.  SecurEtag's unique beam steering technology allows multiple low
cost passive tags to be detected in the field, without the need for batteries
or complicated anti-collision protocols, which increase the cost of the tag
and decrease the reading range.

5.  Target Markets

ASI has developed a multi tiered marketing strategy for the Data3mail and
AirCommerce programs that provide the opportunity to generate revenue in three
target markets within the airline industry.

Offering the program to small to medium sized airlines creates
revenue streams in the supply of relevant equipment, the selling of
advertising space and the commissions received from goods and services ordered
by passengers whilst in flight.

With the latest development of its cost efficient Email service, Data3Mail,
ASI is able to market its services, through strategic alliances, to major
airlines around the world.  These major airlines, as well as some of the
smaller airlines, posses the ability through existing data ports, to allow
ASI to provide Data3Mail simply and cost efficiently.

ASI's competitors in this area, are promoting similar services that will
entail extensive and expensive installations for airlines and high service
costs to the passenger.

Once ASI has established Data3Mail onboard, there is the potential to
provide the AirCommerce Program to these major airlines, creating an

                                      -3-
<PAGE>

additional revenue stream for both ASI and the airline.  The AirCommerce
program accommodates a database of destination information and allows
in-flight bookings and reservations.  The Company will receive revenues from
data communications and from the sale of advertising space available on the
AirCommerce programs.

The SecurEtag program will be set up first on a trial basis with a transport
company to identify and meet the technical and commercial requirements of the
North American market.  Once this initial stage is completed, the company will
be able to move to a commercial implementation program. The target market for
the technology will be companies handling high value and important parcels and
are in markets where a premium price can be charged for the SecurEtag service.
As the market develops and the cost of the components decreases, the broader
freight market will be more viable for the SecurEtag product.

CERTIFICATION PROCESS AND GOVERNMENT REGULATION

The installation and use of aircraft avionics requires prior certification and
approval by the FAA and regulatory authorities of foreign governments on each
aircraft type and for each airline. The certification process begins with the
installation of the system on an aircraft after which it is certified by an
FAA accredited engineer. The certification is then applicable to similar
aircraft types and modified for other aircraft type. In countries other than
the United States, the equivalent aviation authority procedures will apply to
the certification of the system, but the United States FAA is generally
accepted by local certifying authorities throughout the world.

Prior to certification and approval, the manufacturer must demonstrate that the
system has been designed and manufactured and complies with the appropriate
aviation standards, namely DO160 for hardware and DO178 for software.
Following this step, the system must be installed on an aircraft and tested,
including a ground and flight test.

The ACAMS has been flight tested and installed on Boeing 747-400 and Boeing
767-300 aircraft. The company has also certified programs on other hardware
platforms for Boeing 737-300, 757-200 and the McDonnell-Douglas DC-9-30 and
MD-82. The latest version of the ACAMS SIU, incorporating Data3Mail, has
gained FAA approval for installation on Boeing 747-400 with Saudis
Airlines and Boeing 767-300 for Alitalia

The company will need to invest substantial funds to package and certify the
SecurEtag system to meet the requirements of the Federal Communications
Commission ("FCC").  In the interim, a development platform can be established
under FCC approval which will facilitate the marketing program.

PRODUCT DEVELOPMENT

Prior to the company acquiring the intellectual property, ASIT Australia had
spent approximately A$5,000,000 developing the ASI program. The Company has
subsequently invested a further $2,000,000 in developing the latest product
offering. The technology behind the Company's Programs evolved from a data
link aviation communications system, designated the Airline Communications
and Management System ("ACAMS") developed by ASIT Australia in conjunction with
Qantas Airways and Swissair. The development of the technology was sponsored
by Qantas Airways which required both an interface which would allow the crew
to communicate through the aircraft's satellite and radio communications data

                                      -4-
<PAGE>

link and an interface between the ACAMS datalink and the aircraft's video
systems. This interface evolved into the ASI-9000 computer video.

The SecurEtag technology was developed to address the high rate of loss
through theft in the freight industry.  The license to the SecurEtag
technology was acquired to expand the operating base of ASI and to develop
further in the area of communications technologies.  Apart from the freight
industry, ASI believes there will be applications for the SecurEtag technology
in the aviation industry through the tracking of packages and other objects
both in the aircraft environment and the support services environment.

OPERATIONS TO DATE

The company is undergoing Data3mail test flights with Saudi Arabian Airlines
and Alitalia as part of an AirTV development program. Under the program,
AirTV is paying for the certification and installation of the system.

SALES AND PRICING

The Company sells both the Data3Mail and AirCommerce system under Supply and
License Agreements under which ASI receives payment, plus a share of the
revenue generated from the programs. ASI supplies equipment on either a sale
basis or alternatively may negotiate to provide the equipment at a discounted
price in exchange for a larger revenue share. The AirCommerce marketing is
based on selling advertising on the programs run on ASI supplied equipment.
The Company believes that the revenue can be enhanced when the Data3mail
communication link is installed, allowing passengers to purchase goods and
services being promoted via the system.

ASI will generate revenue from Data3Mail programs by charging passengers per
kilobyte of data transmitted over the air-to-ground link.

The Company will purchase hardware from appropriate suppliers, depending on
the specification requirements of each airline. The Company subcontracts the
production of the ACAMS SIU integration technology.

While the Company is still formulating the marketing plan for SecurEtag, it
expects to be able to generate revenue either from the sale of RFID tags or
through the management of a loss prevention or detection programs, or from a
combination of both.

OPERATIONS AND SUPPLIERS

The Company has two facilities in Australia, one certified to support the SIU
hardware platform and the other providing software development, network
services, gateway, and administration. The company also has an office in
Denver, Colorado providing logistics support and more recently established an
office in California to support the strategic alliances being forged with the
major aircraft systems manufacturers.

The Company's core component of the Data3Mail and AirCommerce programs is the
ACAMS SIU which as been manufactured to date by ASIT Australia and Philips
Defence Systems Group. In future the Company anticipates that it will
outsource the production of its equipment or will modify equipment from a
suitable aviation certified manufacturer.

                                      -5-
<PAGE>

The Company has out-sourced all of its operations to companies and individuals
specializing in either the manufacture and installation of avionics or the
procurement of advertisement sponsors.   The Company will contract with an
installation company to install its equipment on the customer airline.  Once
installed, the Company out-sources all of the hardware engineering and technical
support services to ASIT Australia and other suitably certified organizations.

Similarly, the Company will outsource the manufacture and supply of all
equipment and components required for the SecurEtag program.

MARKETING

After considering the competitive environment of the airline communications
and entertainment industry, the Company has decided on a marketing strategy to
provide the Data3mail and AirCommerce programs on the basis of a system fee
plus a share of the on-going revenue generated from the system. The revenue
share and the sale price of the equipment will be negotiated on a
transaction-by-transaction basis.

The Company researches the market and targets selected airlines based on a
commercial and technical evaluation. The Company has formed relationships with
other avionics manufacturers who sell complimentary products to the Company's.
The Company anticipates these strategic partners will introduce the Company
to airlines as such target airlines look for ways to enhance the products and
services they purchase from the alliance partner.

CUSTOMERS

The company currently provides services to AirTV Limited, a company which is
developing a global satellite television system that interfaces with existing
in-flight entertainment systems on board aircraft to provide direct television
programming and internet delivery services.  The Company is providing AirTV
with technical marketing services and onboard system integration and airline
program management for an Email/Internet service to be offered to AirTV's
customer airlines.

The Company is also marketing its Data3mail to other prospective airline
customers.

COMPETITION

The Company believes that it operates in a market niche offering the lowest
cost email solution for airlines where there are no other companies providing
both the same product with a similar price structure.
The Company believes, however, that the market for technologically advanced
in-flight entertainment and communications systems is emerging and that
competition to provide such services to the airlines will be intense. The
Company is aware of several other companies that provide systems that compete
with the Company's products, some of which have been installed on aircraft.
Most of these competitors have substantially greater financial and other
resources than the Company and, accordingly, may have a significant
competitive advantage over the Company.

The effect of September 11 has reduced the Company's principal competitors to
only Tenzing and Connexion by Boeing. Companies such as Matsushita Avionics
Systems Corporation and Stratos also offer a short message service (SMS) which

                                      -6-
<PAGE>

could be perceived as a competitor to Email.  The company is working with both
these organizations to integrate the Data3mail system.

The Company believes that it will be able to compete with other companies
based on the company's marketing plan that provides flexible terms on equipment
and revenue sharing.  The Company targets airlines that will be attracted to
this structure which allows the airline to provide more customized service at
little cost to the airline. The Company believes that although most of the
Company's competitors are marketing more technologically advanced
communication and entertainment systems, those competing services are offered
at a far greater expense to the airlines both in the capital cost and in the
operating costs.

For Data3Mail, airlines and their passengers have identified Email as a service
which is becoming highly desirable.  As a result, a number of companies
are offering internet portal services, most still in the development stage.
By comparison, ASI's Data3Mail utilizes the existing Inmarsat satellite data
link which is installed on 3000 aircraft. ASI promotes Data3mail system as the
lowest cost solution available in the airlines industry. Given the potential
size of the market for Email access in commercial passenger aircraft, ASI
expects there will be continued competition for ASI's products.

The main competition for the SecurEtag technology will come from bar-coding
technologies as well as new developments in RFID technologies.  The increasing
rate of theft and the demand of freight customers to know the status of goods
they have shipped will increase demand for technology similar to and that
would compete with the SecurEtag technology.  Another competitive factor to
determine the success of SecurEtag will be the time it takes ASI to develop a
market for the product and the alternate products that are developed in that
time.

There is no assurance that the Company's competitors will not offer services
similar to the Company's with a similar business plan. Nor is there an
assurance that passengers and airlines will not demand more technologically
advanced communication and entertainment products or that the Company will be
able to compete with other more established sources for advertising.
Similarly, there can be no assurances that other tagging technologies will not
be developed that will compete with the SecurEtag technology.

EMPLOYEES

The Company is managed by Ronald Chapman in his capacity as President and
Chief Executive Officer and Philip Shiels in his capacity as Executive
Director and Chief Financial Officer. The company recently appointed Tom
Henderson as Vice President Strategic Business Development. The Company
currently contracts the engineering team and engages sub-contractors when
additional resources are required.

INDUSTRY OVERVIEW

The events on September 11, 2001 in the USA and the SARS virus have had a
significant effect on the airline industry.  Despite this, the longer term
growth of the airline industry is expected to continue.  Boeing are predicting
airline passenger growth of 4.9% per annum over the period 2001 - 2020, 2%
above the predicted worldwide rate of economic growth of 2.9% for the same

                                      -7-
<PAGE>

period (Source Current Market Outlook 2002, - www.boeing.com/commercial).  At
this stage, the Company's target market has seen minimal change and following
the recent World Airline Entertainment Associations annual conference held in
Seattle, Sept. 9 - 12 (www.waea.org) interest in Data3mail has remained high.

In regard to SecurEtag, while security and tracking of packages is a higher
priority in the transport industry the worldwide economic downturn has seen a
substantial reduction in program development and capital expenditure on new
systems.  The company expects that the problems associated with security will
not change and that as the economies recover so will the demand for new
technologies

ITEM 2. DESCRIPTION OF PROPERTY.

The Company does not own any property other than its inventory of equipment,
office equipment and fittings and a motor vehicle. The Company maintains its
marketing, corporate and administration offices at 1/12 Candlebark Court
Research and its engineering and customer support operations at 2/12
Candlebark Court Research.


ITEM 3. LEGAL PROCEEDINGS.

The Company is not a party to any litigation and management has no knowledge of
any threatened or pending litigation against the Company.

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

Not applicable.

PART II

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

The Company has authorized capital of 100,000,000 shares of Common Stock,
$.0001 par value, and 20,000,000 shares of preferred stock, $.0001 par value.
As of the date hereof, the Company has 11,811,227 shares of Common Stock
issued and outstanding and no shares of Preferred Stock outstanding.

Since March, 2000 the Company's Common Stock has been quoted on the NASD OTC
Bulletin Board.  Prior to that date, there was no public market for the
Company's securities.  The following table sets out the range of the high and
low sales prices for the Company's securities.

                                      -8-
<PAGE>


Quarter Ended                                    Common Stock
                                                           High         Low
March 31, 2000                                $1.25        $1.25
June 30, 2000                                 $1.81        $1.00
September 30,2000                             $1.50        $0.63
December 31, 2000                             $0.63        $0.28
March 31, 2001                                $0.53        $0.50
June 30, 2001                                 $0.51        $0.51
September 30,2001                             $0.51        $0.51
December 31, 200                              $0.51        $0.51
March 31, 2002                                $0.51        $0.21
June 30, 2002                                 $0.35        $0.21
September 30,2002                             $0.20        $0.42
December 31, 2002                             $0.34        $0.60
March 31, 2003                                $0.34        $0.69
June 30, 2003                                 $0.51        $0.72

The Company currently intends to retain substantially all of its earnings, if
any, to support the development of its business and has no present intention of
paying any dividends on its Common Stock in the foreseeable future. Any future
determination as to the payment of dividends will be at the discretion of the
Board, and will depend on the Company's financial condition, results of
operations and capital requirements, and such other factors as the Board deems
relevant.

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

OVERVIEW

The Company has a very low cost structure as its engineering operations are
based in Australia compared to its competitors who are based in Seattle,
Washington, U.S.A. This allows the company to offer competitive pricing in US
Dollars while its cost structure is based on Australian Dollars.

The company focuses it resources on marketing, software development and
maintains a prototyping research and development capability. The hardware
platform was designed to ensure that is could be supported and manufactured by
any aviation certified company. Under arrangements with ASIT Australia, the
Company maintains Australian aviation certification. This allows the Company to
subcontract the production and support of the hardware, which in turn
eliminates the cost of maintaining FAA manufacturing accreditation. The company
has an arrangement with an FAA certified facility to provides hardware and
installation support.

As the company is now entering an accelerated marketing phase, the marketing
costs are expected to increase. The company is progressively increasing its
operations in North America and anticipates establishing a marketing presence
in Europe.

Because of the low cost structure, the Company anticipates that the proceeds
from earlier stock subscriptions, revenues from any exercise of the Options,
anticipated revenues from operations, and proceeds available from its suppliers
will be sufficient to meet the Company's contemplated operating and capital
requirements for approximately 12 months.

                                      -9-
<PAGE>

RESULTS AND PLAN OF OPERATIONS

The Company had accumulated losses from inception to June 30, 2003 of
$3,079,742. Major components of the loss includes depreciation, amortisation,
stock impairment, offering costs, consulting and management fees and foreign
currency translation losses. The Company may be required to make significant
additional expenditures in connection with the development of the Data3Mail,
AirCommerce and SecurEtag programs and their marketing. The Company's ability
to continue its operations is dependent upon its receiving funds through its
anticipated sources of financing including exercise of Options, revenues from
operations, and proceeds available from its suppliers. However, the Company
may be required to raise additional capital through debt or equity financing.

The Company intends to use future revenues, if any, for the purchase of
equipment for its Data3mail, AirCommerce and SecurEtag programs and for capital
expenditures and working capital for its proposed operations, and certain
fees, costs and expenses associated with this offering.

YEAR ENDED JUNE 30, 2003 COMPARED TO YEAR ENDED JUNE 30, 2002

The Company received revenue of $50,100 for the year ending June 30, 2003,
compared to revenue of $286,103 for the year ended June 30, 2002.

Net losses increased from $408,429 in the twelve month period ending June 30,
2002, to $895,030 for the twelve month period ending June 30, 2003, as a
result of increase operating expenses. Expenses increased from $645,348 for
the twelve month period ending June 30, 2002 to $944,9556 for the twelve month
period ending June 30, 2003.

The Company had a foreign currency translation gain of $160,058 for the twelve
month period ending June 30, 2002, compared to a foreign currency translation
gain of $82,778 for the twelve month period ending June 30, 2002. As a result,
the Company recorded a comprehensive loss of $734,972 for the twelve months
ended June 30, 2003, compared to a comprehensive loss of $325,651 for the
twelve months ended June 30, 2002.

LIQUIDITY AND CAPITAL RESOURCES

The Company has used the proceeds from the sale of the securities for payment
of operating costs to date. The Company has received revenue totaling $50,100
from its arrangements with AirTV during the fiscal year ended June 30, 2003.

The Company's cash and cash equivalents decreased from $8,482 at June 30,
2002 to negative $2,912 at June 30, 2003 as a result of operating losses.

The Company had a net loss of $895,030 from operating activities for the
period July 1, 2002 to June 30, 2003, primarily consisting of management fees
and compensation to officers, consulting fees, engineering and stock
impairment. The net loss from operating activities for such period was greater
than the net loss from operating activities for the period July 1, 2001 to
June 30, 2002 primarily as a result of decreased consulting revenue and
increased consulting fees, engineering, management fees and travel but after
decreased amortisation charge.  The Company's revenue for the twelve months
ending June 30, 2003 was $50,100, compared to $286,103 in the twelve month
period to June 30,2002.

                                      -10-
<PAGE>

The cash flow of the Company from financing activities for the twelve months
ending June 30, 2003 was mainly from the proceeds from issue of common stock,
loans from related parties and funds received pending the issue of stock.

The Company's marketing plan anticipates that it will install and maintain the
Data3Mail and AirCommerce programs on commercial airlines. This plan may
require significant initial capital from the Company for the production,
acquisition, installation and maintenance of the Data3Mail and AirComerce
programs possibly before any revenues are received.  Additional funding will
also be required for the certification of the SecurEtag system. The Company
may not have sufficient funds to purchase or install the equipment in which
case the Company will have to seek additional capital. The Company may raise
additional capital by the sale of its equity securities, through an offering
of debt securities, or from borrowing from a financial institution. The
Company does not have a policy on the amount of borrowing or debt that the
Company can incur. The Company may also attempt to negotiate with vendors or
customer airlines revenue sharing arrangements by which the Company will share
the advertising revenue if the vendor or customer airline provides capital for
the equipment.

The Company has no commitments for capital expenditures in the near future.

GOING CONCERN QUESTION

The financial statements appearing elsewhere in this report have been prepared
assuming that the Company will continue as a going concern. As such, they do
not include adjustments relating to the recoverability of recorded asset
amounts and classification of recorded assets and liabilities. On July 1, 1998,
the Company acquired 100% of ASI Entertainment Pty Ltd., ("ASIE") an Australian
corporation. ASIE had accumulated losses of approximately $1,562,000 at June
30, 2003 and will be required to make significant expenditures in connection
with continuing engineering and marketing efforts along with general and
administrative expenses. The Company's ability to continue its operations is
dependent upon its raising of capital through debt or equity financing in
order to meet its working needs.

These conditions raise substantial doubt about the Company's ability to
continue as a going concern subsequent to the acquisition, and if substantial
additional funding is not acquired or alternative sources developed,
management will be required to curtail its operations.

The Company may raise additional capital by the sale of its equity securities,
through an offering of debt securities, or from borrowing from a financial
institution. The Company does not have a policy on the amount of borrowing or
debt that the Company can incur. The Company may also attempt to negotiate
with vendors or customers, revenue sharing arrangements by which the Company
will share the revenue if the vendor or customers provides capital for the
equipment. Management believes that actions presently being taken to obtain
additional funding provide the opportunity for the Company to continue as a
going concern.

ITEM 7. FINANCIAL STATEMENTS.





                                      -11-
<PAGE>


ASI ENTERTAINMENT, INC.

CONSOLIDATED
FINANCIAL STATEMENTS

June 30, 2002 & 2003



























<PAGE>




ASI ENTERTAINMENT, INC.
Consolidated Financial Statements



TABLE OF CONTENTS


										Page

INDEPENDENT AUDITOR'S REPORT ON
    THE CONSOLIDATED FINANCIAL STATEMENTS				F-1


CONSOLIDATED FINANCIAL STATEMENTS

		Consolidated balance sheet				F-2
		Consolidated statement of operations		F-3
		Consolidated statement of stockholders' equity	F-4
		Consolidated statement of cash flows		F-5
		Notes to consolidated financial statements	F-7

































<PAGE>


                             RONALD R. CHADWICK, P.C.
                            Certified Public Accountant
                          2851 South Parker Road, Suite 720
                             Aurora, Colorado  80014
                             Telephone (303)306-1967
                                Fax (303)306-1944

                          INDEPENDENT AUDITOR'S REPORT


Board of Directors
ASI Entertainment, Inc.
Melbourne, Australia

I have audited the accompanying consolidated balance sheet of ASI
Entertainment, Inc. as of June 30, 2003 and the related consolidated
statements of operations, stockholders' equity and cash flows for the years
ended June 30, 2002 and 2003. These financial statements are the
responsibility of the Company's management. My responsibility is to express
an opinion on these financial statements based on my audit.

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

In my opinion, the consolidated financial statements referred to above present
fairly, in all material  respects, the financial position of ASI
Entertainment, Inc. as of June 30, 2003 and the results of its operations and
its cash flows for the years ended June 30, 2002 and 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 6 to the
financial statements the Company has suffered recurring losses from operations
that raise substantial doubt about its ability to continue as a going concern.
Management's plans in regard to these matters are also described in Note 6.
The financial statements do not include any adjustments that might result from
the outcome of this uncertainty.

Aurora, Colorado                                   /s/Ronald R. Chadwick, P.C.
September 22, 2003                                     RONALD R. CHADWICK, P.C.







                                     F-1

<PAGE>


                             ASI ENTERTAINMENT, INC.
                           CONSOLIDATED BALANCE SHEET
                                June 30, 2003

ASSETS

Current assets
Cash                                                   $            -
Accounts receivable                                            48,888
Advances                                                       50,166
Other                                                           3,574
Total current assets                                          102,628

Property and equipment, net                                   885,018
                                                              885,018

Total Assets                                                $ 987,646

LIABILITIES & STOCKHOLDERS' EQUITY

Current liabilities
Bank credit                                                   $ 2,912
Accounts payable and accrued expenses                          42,471
Due to related parties                                        354,096
Stock subscription payable                                     21,885
Total current liabilities                                     421,364

Total Liabilities                                             421,364

Stockholders' Equity
Preferred stock, $.0001 par value;
20,000,000 shares authorized; none issued and outstanding           -
Common stock, $.0001 par value;
100,000,000 shares authorized;
11,811,227 issued and 11,761,227 outstanding                    1,181
Additional paid in capital                                  4,390,318
Additional paid in capital - discount on shares              (745,470)
Treasury stock - par value (50,000 shares)                         (5)
Accumulated deficit                                        (2,851,575)
Accumulated other comprehensive loss                         (228,167)
Total Stockholders' Equity                                    566,282

Total Liabilities and Stockholders' Equity                  $ 987,646


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

                                     F-2
<PAGE>


                             ASI ENTERTAINMENT, INC.
                       CONSOLIDATED STATEMENT OF OPERATIONS
                    For The Years Ended June 30, 2002 and 2003


                                                 2002               2003

Sales, net                                    $ 286,103          $ 50,100

Cost of sales                                   (49,184)             (186)

Gross margin                                    236,919            49,914

Selling, general and administrative expenses    645,348           944,955

Loss from operations                           (408,429)         (895,041)

Other income (expense)
Interest income                                                        11
Interest expense

Income (loss) before provision for income taxes(408,429)         (895,030)

Provision for income tax                              -                 -

Net income (loss)                            $ (408,429)       $ (895,030)

Other comprehensive income (loss)
Foreign currency translation gains (losses)      82,778           160,058

Comprehensive loss                           $ (325,651)       $ (734,972)

Net income (loss) per share
(Basic and fully diluted)                       $ (0.04)          $ (0.08)

Weighted average number of
common shares outstanding                     9,831,126        11,285,136






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

                                     F-3
<PAGE>

                                                 ASI ENTERTAINMENT, INC.
                                CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                                  For The Years Ended June 30, 2002 and 2003
<TABLE>
<CAPTION>
                                                                   Paid in                               Accum.
                                                                   Capital                               Other         Stock-
                                Common      Stock     Paid In      Discount    Treasury     Accum.       Compre.       holders'
                                Shares      Amount    Capital      On Shares    Stock       Deficit     Income/loss     Equity
                              ---------     ------    -------      ---------    -----       -------     ----------     -------
<S>
<C>                          <C>           <C>       <C>          <C>          <C>         <C>         <C>            <C>
Balances at June 30, 2001     6,344,587     $ 634   $3,592,588    $ (745,470)   $ (5)    $(1,548,116)   $ (471,003)  $ 828,628

Exercise of stock options         4,167         1        2,083                                                           2,084

Compensatory stock issuances     87,500         9       71,267                                                          71,276

Issuance of stock for assets   3,931,347      393         (393)                                                              -

Issuance of stock for
stock subscription payable       250,000       25      124,975                                                         125,000

Foreign currency
translation gain (loss)                                                                                     82,778      82,778

Net gain (loss) for the year
ended June 30, 2002                                                                         (408,429)                 (408,429)
                              ----------   ------    ---------      --------     ---     -----------     ---------     -------
Balances at June 30, 2002     10,617,601  $ 1,062   $3,790,520    $ (745,470)   $ (5)   $ (1,956,545)   $ (388,225)  $ 701,337

Exercise of stock options        379,840       38      189,882                                                         189,920

Compensatory stock issuances     642,500       64      321,186                                                         321,250

Issuance of stock for cash       171,286       17       76,358                                                          76,375

Compensatory option issuances                           12,372                                                          12,372

Foreign currency
translation gain (loss)                                                                                    160,058     160,058

Net gain (loss) for the year
ended June 30, 2003                                                                        (895,030)                  (895,030)
                              ----------  ------    ---------     ---------     ---     -----------     ---------     --------
Balances at June 30, 2003     11,811,227 $ 1,181   $4,390,318    $ (745,470)   $ (5)   $ (2,851,575)    $ (228,167)  $ 566,282

                   The accompanying notes are an integral part of the consolidated financial statements.
                                                         F-4
</TABLE>
<PAGE>


                           ASI ENTERTAINMENT, INC.
                     CONSOLIDATED STATEMENT OF CASH FLOWS
                  For The Years Ended June 30, 2002 and 2003


                                                    2002            2003

	Cash Flows From Operating Activities:
	Net income (loss)                        $ (408,429)     $ (895,030)

	Adjustments to reconcile net income to
	net cash provided by (used for)
	operating activities:
	Depreciation                                  3,285           4,236
	Amortization                                 52,410          16,178
	Compensatory stock issuances                 71,276         321,250
	Compensatory option issuances                                12,372
	Impairment write down                                       175,395
	Trade accounts receivable                    26,021         (28,888)
	Other receivables                            (2,829)           (378)
	Accounts payable and accrued expenses         8,575          (3,465)
	Net cash provided by (used for)
	operating activities                       (249,691)       (398,330)

	Cash Flows From Investing Activities:
	Purchase of fixed assets                    (13,575)         (5,048)
	Net cash provided by (used for)
	investing activities                        (13,575)         (5,048)




(Continued On Following Page)









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

                                     F-5
<PAGE>


                           ASI ENTERTAINMENT, INC.
                     CONSOLIDATED STATEMENT OF CASH FLOWS
                  For The Years Ended June 30, 2002 and 2003

  (Continued From Previous Page)


                                                    2002            2003
Cash Flows From Financing Activities:
Due to related parties                             53,175          94,413
Issuance of common stock                            2,084         266,295
Common stock subscription payable                                  21,885
Net cash provided by (used for)
financing activities                               55,259         382,593

Effect of exchange rate changes on cash           (15,217)          9,391

Net Increase (Decrease) In Cash                  (223,224)        (11,394)
Cash At The Beginning Of The Period               231,706           8,482

Cash At The End Of The Period                     $ 8,482        $ (2,912)


Schedule Of Non-Cash Investing And Financing Activities
-------------------------------------------------------
During 2002 the Company issued 3,931,347 shares of common stock in exchange
for intellectual property rights on which the Company placed no valuation.
2,068,653 common shares remain to be issued pursuant to the transaction.


Supplemental Disclosure
-----------------------
                                                  2002              2003
Cash paid for interest                      $ -               $ -
Cash paid for income taxes                  $ -               $ -









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

                                     F-6
<PAGE>


                           ASI ENTERTAINMENT, INC.

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING
 POLICIES:

ASI Entertainment, Inc. ("ASI", the "Company"), was incorporated in the State
of Delaware on April 29, 1998. On July 1, 1998 ASI acquired 100% of the issued
and outstanding stock of ASI Entertainment Pty., Ltd. ("ASIE") in a
transaction accounted for as a recapitalization of ASI Entertainment Pty.
Ltd., with ASI Entertainment Pty., Ltd. considered the predecessor pursuant to
the acquisition. ASIE provides Email and Ecommerce systems for airline
passengers with its Data3mail and AirCommerce products. The Company's wholly
owned subsidiary, ASI Technologies, Inc. is an inactive corporation,
incorporated on April 1, 1998 under the laws of Delaware. ASIE's wholly owned
subsidiary, ASI Media Pty., Ltd. ("ASI Media") is an inactive corporation
whose sole purpose is to act as trustee to the ASI Media Unit Trust (the "Unit
Trust"). ASI Entertainment, Inc. and its subsidiaries are hereinafter referred
to as the "Company".

Principles of consolidation

The accompanying consolidated financial statements include the accounts of ASI
Entertainment, Inc. and its wholly owned subsidiaries. All intercompany
accounts and transactions have been eliminated in consolidation.

Basis of Presentation

The financial statements are prepared in accordance with Generally Accepted
Accounting Principles in the United States of America. The basis of accounting
differs from that used in the Australian statutory financial statements of
ASIE. Adjustments are made to translate the statutory financial statements of
ASIE to United States Generally Accepted Accounting Principles. The financial
statements are expressed in United States dollars. The functional currency of
ASIE is the Australian dollar.

Use of Estimates

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

                                     F-7
<PAGE>




                           ASI ENTERTAINMENT, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES (Continued):

Income tax

The Company accounts for income taxes under Statement of Financial Accounting
Standards No. 109 ("SFAS 109"). Under SFAS 109 deferred taxes are provided on
a liability method whereby deferred tax assets are recognized for deductible
temporary differences and operating loss carryforwards and deferred tax
liabilities are recognized for taxable temporary differences. Temporary
differences are the differences between the reported amounts of assets and
liabilities and their tax bases. Deferred tax assets are reduced by a
valuation allowance when, in the opinion of management, it is more likely than
not that some portion or all of the deferred tax assets will not be realized.
Deferred tax assets and liabilities are adjusted for the effects of changes in
tax laws and rates on the date of enactment.

At June 30, 2003 and 2002 the Company had net operating loss carryforwards of
approximately $1,714,000 and $1,330,000 which expire under Australian tax law
at various dates through the year 2008, in addition to net operating loss
carryforwards of approximately $1,137,000 and $630,000 for U.S. tax purposes
at June 30, 2003 and 2002 which begin to expire in 2019. The deferred tax
asset created by the Australian and U.S. net operating losses ($443,472 for
U.S. tax purposes) has been offset by a 100% valuation allowance. The change
in the valuation allowance for U.S. tax purposes in 2003 was $198,268.

Cash and cash equivalents

The Company considers all highly liquid investments with an original maturity
of three months or less as cash equivalents.

Net income (loss) per share

The net income (loss) per share is computed by dividing the net income (loss)
by the weighted average number of shares of common outstanding. Warrants,
stock options, and common stock issuable upon the conversion of the Company's
preferred stock (if any), are not included in the computation if the effect
would be anti-dilutive and would increase the earnings or decrease loss per
share.

Property and equipment

Property and equipment are recorded at cost and depreciated under accelerated
methods over each item's estimated useful life.




                                     F-8
<PAGE>




                                     ASI ENTERTAINMENT, INC.
                            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES (Continued):

Foreign currency translation

The functional currency of ASIE is the Australian dollar. Financial statements
for these entities are translated into United States dollars at year end
exchange rates as to assets and liabilities and weighted average exchange
rates as to revenues and expenses. Capital accounts are translated at their
historical exchange rates when capital transactions occurred.

Revenue recognition

Revenue is recognized on an accrual basis as earned under contract terms.

Comprehensive income (loss)

The Company accounts for comprehensive income (loss) under Statement of
Financial Accounting Standards No. 130, "Reporting Comprehensive Income"
("SFAS 130"). SFAS 130 establishes standards for reporting and display of
comprehensive income and its components. The foreign currency translation
gains (losses) resulting from the translation of the financial statements of
ASIE, expressed in Australian dollars, to United States dollars are reported
as Other Comprehensive Income (Loss) in the Statement of Operations and as
Accumulated Other Comprehensive Income (Loss) in Stockholders' Equity.

Financial Instruments

The carrying value of the Company's financial instruments, including cash and
cash equivalents, accounts payable, and due to related parties, as reported in
the accompanying balance sheet, approximates fair value.

Products and services, geographic areas and major customers

Company sales are derived from the sale of in-flight video and audio
entertainment and data communications to the commercial airline industry and
advertising time on its ASI-9000 Programs, are to external customers, and
currently originate in and through the Company's Australian subsidiary ASI
Entertainment Pty., Ltd. to non-domestic customers. The Company had one major
customer accounting for 100% of its sales. In addition to cost of goods sold,
the Company incurred direct marketing expenses of  approximately 40% on its
sales in 2002. The Company's long term assets are held through ASI
Entertainment Pty., Ltd. in Australia.



                                     F-9
<PAGE>




                           ASI ENTERTAINMENT, INC.
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING
 POLICIES (Continued):

Recent Accounting Pronouncements

In July 2002, the FASB issued SFAS No. 146, "Accounting for Costs Associated
with Exit or Disposal Activities." SFAS No. 146 requires that a liability for
costs associated with an exit or disposal activity be recognized and measured
initially at fair value only when the liability is incurred. Prior to the
adoption of SFAS No. 146, such amounts were recorded upon the Company's
commitment to a restructuring plan. SFAS No. 146 is effective for exit or
disposal activities that are initiated after December 31, 2002. Accordingly,
the Company has adopted this statement for applicable transactions occurring
on or after January 1, 2003.

In December 2002, the FASB issued SFAS No. 148, "Accounting for Stock-Based
Compensation - Transition and Disclosure (An amendment of FASB Statement
No. 123)". SFAS No. 148 amends SFAS No. 123 to provide alternative methods of
transition for a voluntary change to the fair value based method of accounting
for stock-based employee compensation. SFAS No. 148 also requires prominent
disclosures in both annual and interim financial statements about the method
of accounting for stock-based employee compensation and the effect of the
method on reported results. The Company has adopted the provisions of SFAS
No. 148 which are effective for financial statements issued for fiscal years
beginning after December 15, 2002. The adoption did not have a material effect
on the results of operations of the Company.

In April 2003, the FASB issued SFAS No. 149, "Amendment of Statement 133 on
Derivative Instruments and Hedging Activities". SFAS 149 amends and clarifies
financial accounting and reporting for derivative instruments. The Company has
adopted the provisions of SFAS No. 149 which are effective in general for
contracts entered into or modified after June 30, 2003. The adoption did not
have a material effect on the results of operations of the Company.

In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain Financial
Instruments with Characteristics of both Liabilities and Equity". SFAS 150
establishes standards for how an issuer classifies and measures certain
financial instruments with characteristics of both liabilities and equity. It
requires that an issuer classify a financial instrument that is within its
scope as a liability (or an asset in some circumstances). Many of those
instruments were previously classified as equity. The Company has adopted the
provisions of SFAS No. 150 which are effective in general for financial
instruments entered into or modified after May 31, 2003. The adoption did not
have a material effect on the results of operations of the Company.



                                     F-10
<PAGE>




                                     ASI ENTERTAINMENT, INC.
                            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1. ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES (Continued):

Long-Lived Assets

In accordance with Statement of Financial Accounting Standard 144 "Accounting
for the Impairment or Disposal of Long-Lived Assets", the Company regularly
reviews the carrying value of intangible and other long-lived assets for the
existence of facts or circumstances, both internally and externally, that may
suggest impairment. If impairment testing indicates a lack of recoverability,
an impairment loss is recognized by the Company if the carrying amount of a
long-lived asset exceeds its fair value.


NOTE 2. RELATED PARTY TRANSACTIONS

As of June 30, 2003 the Company owed officers, directors, and related parties
$354,096 for expenses incurred on behalf of the Company.

The Company in 2003 and 2002 incurred expenses of approximately $166,000 and
$109,000 respectively to a company affiliated through common stockholders and
directors for management expenses.

The Company has established an agreement with ASI Technologies Pty., Ltd.,
("ASIT"), a company related by stock ownership, giving the Company the sole
right to purchase certain hardware and technical support used in its business
operations. The Company was owed approximately $50,000 by ASIT at June 30, 2003.

The Company acquired certain intellectual property rights in August, 2001 from
a Company related by common control (see Note 5).


NOTE 3. LEASE COMMITMENTS

The Company carries two leases for office and storage space in Australia. The
leases expire in 2004 and 2006, are noncancellable, and carry options to
renew. Combined monthly payments are approximately $1,450 per month plus
taxes. Rent expense incurred under the leases in 2003 was approximately
$10,500. Subsequent to June 30, 2003 future minimum payments under the lease
not including estimated costs for taxes are approximately $24,600. Subsequent
to June 30, 2003 minimum future lease payments for each of the next three
years are approximately $8,900, $8,500 and $7,300.





                                     F-11
<PAGE>




                                     ASI ENTERTAINMENT, INC.
                            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 4. PROPERTY AND EQUIPMENT

On December 16, 1996, the Company purchased from ASI Technologies Pty., Ltd.
("ASIT"), a related party, but not a shareholder at that time, nine CMA-3200
Hardware Platforms (developed and produced by a third party), a component of
the ASI-9000 Program, for a price of $418,424 ($352,215 as translated at June
30, 2003) through the issuance of 659,975 shares of common stock of the
Company. On September 30, 1997, the Company purchased Airline Cabin Management
and Communication Systems ("ACAMS"), which are the next generation hardware
platforms developed by ASIT, and other equipment from ASIT for a price of
$1,081,650 ($1,000,650 as translated at June 30, 2003) through the issuance of
1,875,000 shares of common stock and 1,875,000 common stock purchase options.
The price of both purchases represents ASIT's original cost in such systems.

The following is a summary of property and equipment at June 30, 2003:

CMA-3200, ACAMS and other                                        $  1,177,077
Less: Accumulated depreciation                                       (292,059)
                                                                $     885,018


The CMA-3200 equipment is fully depreciated with a remaining salvage value of
$59,556. Depreciation expense for the years ended June 30, 2003 and 2002 was
$4,236 and $3,285 respectively. The Company tested its ACAMS hardware platform
equipment at the end of 2003 for impairment, as the equipment had not yet been
placed in service or depreciated for several years. Although cash flow
analysis indicated no need to impair, the Company took an impairment write
down on the equipment of 20% ($178,773 as translated at June 30, 2003) as the
equipment has not been placed in service for several years, making its
usefulness vulnerable to technological changes and airline industry economic
downturns. The write down of $178,773 is included in the $944,955 listed under
the caption "selling, general and administrative expenses" for 2003 on the
consolidated statement of operations.


NOTE 5.  STOCKHOLDERS' EQUITY

Common stock

The Company as of June 30, 2003 had 100,000,000 shares of authorized common
stock, $.0001 par value, with 11,811,227 shares issued, 11,761,227
outstanding, and 50,000 shares in treasury. Treasury shares are accounted for
by the par value method.

The Company acquired in August, 2001 from a Company related by common control,
intellectual property rights to a parcel tracking and delivery system called
"SecurEtag".

                                     F-12
<PAGE>




                                     ASI ENTERTAINMENT, INC.
                            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 5.  STOCKHOLDERS' EQUITY (Continued):

The purchase price was 6,000,000 of the Company's common shares. The Company
recorded no value on the transaction. Of the 6,000,000 common shares called
for by the purchase agreement, the Company has issued 3,931,347 common shares,
with an additional 2,068,653 common shares to be issued upon request by the
selling party.

Preferred stock

The Company as of June 30, 2003 had 20,000,000 shares of authorized preferred
stock, $.0001 par value, with no shares issued and outstanding.

Stock options

At June 30, 2003 the Company had stock options outstanding as described below.

Non-employee stock options

The Company accounts for non-employee stock options under SFAS 123, whereby
option costs are recorded based on the fair value of the consideration
received or the fair value of the equity instruments issued, whichever is more
reliably measurable.

In July, 1998 the Company issued 43,158 stock options, allowing the holder to
purchase one share of common stock per option, exercisable immediately at
$0.50 per share to a consulting company as compensation for services, and
issued 4,384,015 options, allowing the holder to purchase one share of common
stock per option, exercisable immediately at $0.50 per share to option holders
in ASIE in exchange for their outstanding options in ASIE. These options,
totaling 2,947,283 at the beginning of the year, have an extended option term
ending June 30, 2004. During the year ended June 30, 2003, 379,840 of these
options were exercised. As of June 30, 2003, 2,567,443 of these options
remained outstanding and are exercisable through June 30, 2004.

In May, 2002, the Company granted 250,000 stock options, allowing the holder
to purchase one share of common stock per option, exercisable immediately at
$0.50 per share with the option term running through June 30, 2004, to a
company for consulting services. As of June 30, 2003, 250,000 of these options
remained outstanding. The fair value of this option grant was estimated on the
date of grant using the Black-Scholes option pricing model with the following
assumptions: risk free interest rate of 5%, dividend yield of 0%, expected
life of one year, volatility of 106%. The Company incurred and recorded
compensation expense under these stock options of $27,526 in 2002.




                                     F-13
<PAGE>




                                     ASI ENTERTAINMENT, INC.
                            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 5.  STOCKHOLDERS' EQUITY (Continued):

In 2003, the Company granted 40,000 stock options, allowing the holder to
purchase one share of common stock per option, exercisable immediately at
$0.50 per share with the option terms expiring in 2004 and 2005, to
individuals for consulting services. As of June 30, 2003, 40,000 of these
options remained outstanding. The fair value of these option grants were
estimated on the date of grant using the Black-Scholes option pricing model
with the following assumptions: risk free interest rate of 5%, dividend yield
of 0%, expected lives ranging from two to two and one-half years, volatility
from 135 - 150%. The Company incurred and recorded compensation expense under
these stock options of $12,372 in 2003.

Employee stock options

The Company applies APB Opinion 25 and Related Interpretations in accounting
for employee stock options. Accordingly, no compensation cost has been
recognized for its employee stock options (and no employee stock options were
granted in 2002 or 2003). Had compensation cost for the Company's employee
stock option awards and incentive stock option plan been determined based on
the fair value at the grant dates for awards under the stock option grants and
incentive stock option plan consistent with the method of FASB Statement 123,
the Company's net income and earnings per share would not have changed as
indicated in the pro forma amounts below:

                                               2002                  2003
                                               ----                  ----
Net income (loss)          As reported    $(  408,429)           $(  895,030)
                           Pro forma      $(  408,429)           $(  895,030)

Basic and fully diluted    As reported    $(.04)                 $(.08)
    earnings per share     Pro forma      $(.04)                 $(.08)

The fair value of each option grant (if any) for pro forma purposes would have
been estimated on the date of grant using the Black-Scholes option pricing
model with the following assumptions: risk free interest rate of 5%, dividend
yield of 0%, expected life of two years, volatility of 0%.

In July, 1998, the Company issued 500,000 options, allowing the holder to
purchase one share of common stock per option, exercisable immediately at $.50
per share to certain officers and directors of the Company in exchange for
their outstanding options in ASIE. These options have an extended option term
ending June 30, 2004. As of June 30, 2003, 333,333 of these options remained
outstanding.




                                     F-14

<PAGE>



                                     ASI ENTERTAINMENT, INC.
                            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 5.  STOCKHOLDERS' EQUITY (Continued):

A summary of the status of the Company's employee stock options as of June 30,
2003 is presented below:


                                                                Weighted Ave.
Options                                     Shares              Exercise Price
-------                                     ------              --------------
Outstanding at
beginning of period                        333,333                 $ 0.50
Granted                                          -                      -
Exercised                                        -                      -
Forfeited                                        -                      -
                                           -------                  -----
Outstanding at
   end of period                           333,333                 $ 0.50
Options exercisable
   at period end                          333,333
Weighted average fair
   value of options
   granted during the
   the period                                                      $    -


The following table summarizes information about employee stock options
outstanding at June 30, 2003.

                       Options Outstanding                 Options Exercisable
              ---------------------------------------   ----------------------
                          Weighted Ave.                               Weighted
Range of      Number      Remaining      Weighted Ave.  Number        Ave.
Exercise      Outstanding Contractual    Exercise       Exercisable   Exercise
Price         at 6/30/03  Life           Price          at 6/30/03    Price
--------      ----------  ------------   ------------   ----------    --------
$ 0.50         333,333       1 Year         $ 0.50        333,333      $ 0.50









                                     F-15
<PAGE>




                                     ASI ENTERTAINMENT, INC.
                            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 6.  GOING CONCERN

The Company has suffered recurring losses from operations and in all
likelihood will be required to make significant future expenditures in
connection with continuing engineering, installation, maintenance and
marketing efforts along with general administrative expenses. These conditions
raise substantial doubt about the Company's ability to continue as a going
concern.

The Company may raise additional capital through the sale of its equity
securities, through an offering of debt securities, or through borrowings from
financial institutions. In addition, the Company may also attempt to negotiate
revenue sharing arrangements with vendors or customer airlines whereby the
Company will share its advertising revenues in exchange for capital to cover
equipment or installation costs. The Company also expects additional contracts
with airlines to install its equipment in the near future. Management believes
that actions presently being taken to obtain additional funding provide the
opportunity for the Company to continue as a going concern.





























                                     F-16
<PAGE>




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

Not applicable

PART III

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

The officers and directors of the Company are as follows:

Name:                             Title:
- - -----                         ------

Ronald J. Chapman                 President and Director

Graham O. Chappell                Director

Philip A. Shiels                  Executive Director and Chief Financial
                                   Officer and Director

Richard W. Mason                  Director

Thomas D. Henderson               Director, Vice President Strategic Business
                                   Development

Dr Elizabeth L. Young             Director


All directors of the Company hold office until the next annual meeting of
shareholders or until their successors are elected and qualified. At present,
the Company's Bylaws provide for not less than one nor more than seven
directors. Currently, there are six directors of the Company. The Bylaws
permit the Board of Directors to fill any vacancy and such director may serve
until the next annual meeting of shareholders or until his successor is
elected and qualified. Officers serve at the discretion of the Board of
Directors.

The principal occupation and business experience for each officer and director
of the Company, for at least the last five years are as follows:

RONALD J. CHAPMAN, 51, serves as President and a director of the Company.
Commencing in 1985, Mr. Chapman founded and remains the managing director of
ASI Holdings Pty. Ltd., ASI Australia, ASI Entertainment Pty. Ltd., and ASI
Media Pty. Ltd. ASI Entertainment Pty. Ltd. and ASI Media Pty. Ltd. are
Subsidiaries of the Company. Since inception, Mr Chapman has overseen the
product development and coordinated the marketing for ASIT Australia. Mr.
Chapman is also managing director and the beneficial owner of 75% of Chapman
International Pty Ltd., a shareholder of the Company.

                                      -12-
<PAGE>

GRAHAM O. CHAPPELL, 58, has been a director of the Company since its inception
and a director of ASIT Australia since 1987. Mr. Chappell has worked in the
aerospace industry for 30 years. Since 1985, Mr. Chappell has operated as the
principal of Chappell Salikin Weil Associates Pty. Ltd. ("Chappell Salikin"),
Victoria, Australia, a private aviation trading and aerospace, technology and
defence industries consultancy company. Chappell Salikin has served as a
consultant to ASIT Australia, ASI Holdings Pty. Ltd. and ASI Entertainment Pty.
Ltd. Mr. Chappell obtained a Diploma of Aeronautical Engineering degree from
the Royal Melbourne Institute of Technology in 1968 and a Masters of Science
(Air Transport Engineering) from Cranfield University in 1974.

PHILIP A. SHIELS, 51, has been a director of the Company since 1996. From 1992
to the present, Mr. Shiels has operated Shiels & Co., Victoria, Australia, a
private consulting practice providing management and corporate advisory
services. Shiels & Co. has served as a consultant to ASIT Australia, ASI
Holdings Pty. Ltd. and ASI Entertainment Pty. Ltd. since 1994. Mr Shiels has
served as the Director of Finance for ASI Holdings Pty. Ltd. Mr. Shiels
received a Bachelor of Business (Accountancy) Degree from the Royal Melbourne
Institute of Technology in 1976 and has been an Associate Member of
the Institute of Chartered Accountants in Australia since 1978.

RICHARD W. MASON, 70, has been a director of the Company since June, 1998. From
1989 through 1997, Mr. Mason served as president of Global Aviation Associates,
Inc. From June, 1997 to February, 2001, Mr. Mason served as chairman of the
Board of Directors of Global Aviation Associates Inc., Aurora, Colorado. Prior
to forming Global Aviation, Mr. Mason held the position of Vice President of
Combs Gates, Inc. (a subsidiary of Gates Learjet) Denver Colorado, a company
with which he was associated twenty years. From 1995 to 2001, Mr. Mason served
as vice president of Lasting Treasures Publishing Company, Houston, Texas, a
music publishing company.

THOMAS D. HENDERSON, 60, joined the Board in March, 2003 and assumed the role
of Vice President Strategic Business Development.  Mr Henderson has held
senior positions in the aerospace industry, most recently as Vice President,
Business Development with Thales In-Flight Systems. During his career, Mr
Henderson has successfully developed a number of avionic products including
surveillance systems for fire safety, security and entertainment applications
and holds patents for various imaging technologies.

DR ELIZABETH L. YOUNG, 60, joined to Board in May, 2003 as a Director and
corporate advisor. Dr Young has held executive positions in the aeronautical
communications field for more than 15 years. Most recently, she served as Vice
President and General Manager of Aeronautical Communications at SITA. She has
extensive experience in satellite communications, having been a senior
executive at COMSAT for ten years and before that, serving as President of the
Public Service Satellite Consortium. Her early career was spent in broadcast
management. She has served as a consultant and speaker for many organizations
in the satellite and communications fields over the years, and has taught and
written extensively in her fields.

                                      -13-
<PAGE>


ITEM 10. EXECUTIVE COMPENSATION.

The Company has not entered into any employment agreements with its executive
officers or directors nor has it obtained any key-man life insurance.

Each director is entitled to receive reasonable expenses incurred in attending
meetings of the Board of Directors of the Company. The members of the Board of
Directors intend to meet at least quarterly during the Company's fiscal year,
and at such other times duly called. The Company presently has six directors.

The following table sets forth the total compensation paid or accrued by the
Company on behalf of the Chief Executive Officer and President of the Company
during 2003. No officer of the Company received a salary and bonus in excess of
$100,000 for services rendered during the fiscal year ended June 30, 2003:

SUMMARY COMPENSATION TABLE

NAME AND PRINCIPAL           FISCAL    ANNUAL      COMPENSATION        OTHER
POSITION                     YEAR      SALARY      BONUS/AWARDS    COMPENSATION
                                                                      ALL OTHER


Ronald Chapman,
President                     2002       0              0           $42,095 (1)

Philip Shiels,
Chief Financial Officer       2002       0              0           $35,079 (2)

1. Directors fees

2. Management fees

3. The Company was invoiced A$98,221 for management services rendered by
Research No.1 Trust.


ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

The following table sets forth certain information as of the date of this
Report regarding the beneficial ownership of the Company's Common Stock by
each officer and director of the Company and by each person who owns in excess
of five percent of the Company's Common Stock giving effect to the exercise of
warrants or options held by the named security holder.

                                      -14-
<PAGE>


                                         Shares of Common
                                         Stock Beneficially    Percentage of
Name, Position and Address               Owned                 Shares Owned

Ronald J. Chapman (3)                    4,318,507              33.3%
President and director
160 Silvan Road,
Wattle Glen
Victoria, 3096, Australia

Graham O. Chappell (4)                   1,248,077              10.2%
Director
5 Marine Parade, Suite 2
St. Kilda,
Victoria, 3148, Australia

Philip A. Shiels (5)                       918,689               7.7%
Chief Financial Officer and director
39 Alta Street
Canterbury, Victoria, 3126,
Australia

Richard W. Mason                            50,000               0.4%
Director
79 Tami Road
Red Feather Lakes, Colorado 80013

Thomas D. Henderson                                 0                 0%
Director and Vice President Strategic Development
1646 Bay Hill Drive
San Marcos, CA, 92069

Elizabeth L. Young                               0                 0%
Director
220 Pipe-n-Tree Drive
Hartfield, VA, 23071

Chapman International Pty. Ltd. (6)        783,333               6.5%
160 Silvan Road
Wattle Glen, Victoria, 3096,
Australia

Research No. 1 Trust (7)                 3,060,255              24.4%
4th Floor
136 Broadway, Newmarket
Auckland 1 New Zealand

Wardour Consultants Ltd. (8)             1,312,500              10.7%
Nine Queens Road
Suite 605-6
Central, Hong Kong

                                      -15-
<PAGE>


Research No. 2 Trust (9)                   918,689               7.7%
4th Floor
136 Broadway, Newmarket
Auckland 1 New Zealand

Glasser Limited. (10)                     801,056               6.8%
Suite 803  Luk Yu Building
24 - 26 Stanley St.,
Central Hong Kong
Hong Kong

Chappell Salikin Weil
Associates Pty. Ltd.(11)                  788,006               9.9%
5 Marine Parade, Suite 2
St. Kilda,
Victoria, 3148, Australia

All the officers and directors
as a group (6 persons)                   6,535,272              48.3%


(1)  Assumes 11,811,227 shares of Common Stock outstanding and assumes exercise
     of options held by named security holder.
(2)  Assumes sale of all the Securities offered by the Selling Securityholders.
(3)  Ronald J. Chapman, President and a director of the Company, owns 125,006
     shares directly and is the managing director (president) and majority
     shareholder of Chapman International Pty. Ltd., and may be considered the
     beneficial owner of the 450,000 Shares owned by it. Chapman International
     Pty. Ltd. is the controlling shareholder of ASIT Australia which owns
     266,575 Shares and Mr. Chapman is the majority shareholder thereof and may
     be deemed to be the beneficial owner of such Shares. Mr. Chapman holds the
     power of attorney for the trustee of the Research No. 1 Trust which holds
     2,326,922 Shares. The listed share holdings also include the Options to
     purchase 333,333 Option Shares held by Chapman International Pty. Ltd.,
     Options to purchase 83,337 Option Shares held directly by Mr. Chapman, and
     Options to purchase 733,333 Options Shares held by the Research No. 1
     Trust.
(4)  Graham O. Chappell, a director of the Company, is the managing director
     (president) and sole shareholder of Chappell Salikin Weil Associates Pty.
     Ltd. and is considered the beneficial owner of the 788,006 Shares and
     416,671 Option Shares held by it. Mr. Chappell is the sole shareholder of
     International Aviation Services Pty. Ltd. which owns 43,400 shares of
     which Mr. Chappell is considered the beneficial owner.
(5)  Philip A. Shiels, Chief Financial Officer and a director of the Company,
     holds the power of attorney for the trustee of the Research No. 2 Trust
     which holds 752,022 Shares and 166,667 Options. Mr. Shiels is a 45%
     shareholder of ASI Holdings Pty. Ltd. which, in turn, holds 61.5% of ASIT
     Australia. Mr. Shiels is not deemed to be a beneficial owner thereof.
(6)  Includes 450,000 Shares and 333,333 Options. Ronald J. Chapman, President
     and a director of the Company is the managing director (president) and
     majority shareholder of Chapman International Pty. Ltd.
(7)  Includes  2,326,922 Shares and 733,333 Options. Ronald J. Chapman,
     President and a director of the Company, holds the power of attorney for
     the trustee of the Research No. 1 Trust which holds 2,326,922 Shares.

                                      -16-
<PAGE>


(8)  Includes 812,500 Shares and 500,000 Options. Lim Tjoei Hoat is the
     beneficial owner of Wardour Consultants, an unrelated independent entity.
(9)  Includes 752,022 Shares and 166,667 Options. Philip A. Shiels, Chief
     Financial Officer and a director of the Company, is the trustee and
     beneficial shareholder of the 752,022 Shares and 166,667 Options owned by
     Research No. 2 Trust.
(10) Ronald Charles Banks is the beneficial owner of Glasser Limited, an
     unrelated independent entity which holds 801,056 shares.
(11) Includes 788,006 Shares and 416,671 Options. Mr Graham O. Chappell is the
     managing director (president) and sole shareholder of Chappell Salikin
     Weil Associates Pty. Ltd. and is considered the beneficial owner.


ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

The Company has purchased the intellectual property of the ACAMS/ASI-9000 from
ASI Australia and has contracted to purchase the ACAMS, when available, from
ASIT Australia. ASIT Australia provides maintenance and servicing of the ACAMS
Hardware. Ronald J. Chapman, President and a director of the Company, controls
Chapman International Pty. Ltd. which owns 55% of ASI Holdings Pty. Ltd. ASIT
Australia which, in turn, owns 61.5% of ASI Australia. Philip A. Shiels, Chief
Financial Officer and a director of the Company, is a 45% shareholder of
ASI (Holdings) Pty. Ltd. Graham O. Chappell, a director of the Company,
is the managing director (president) and sole shareholder of Chappell Salikin
Weil Associates Pty. Ltd.

Ronald Chapman, Graham Chappell, and Philip Shiels are directors of the Company
and directors of the Company's subsidiaries ASI Entertainment Pty. Ltd. ("ASIE
Australia") and ASI Media Pty. Ltd. Ronald Chapman and Philip Shiels are the
directors and officers of ASIT Australia.

Chapman International Pty. Ltd. will likely provide management services to the
Company. Ronald J. Chapman, President and a director of the Company, is the
beneficial owner of 100% of Chapman International Pty. Ltd..

By an agreement of January 9, 1996, ASI Entertainment Pty. Ltd. (prior to
becoming a subsidiary of the Company) purchased from ASI Technologies Pty. Ltd.
("ASIT Australia") for the purchase price of $894,450, among other items, 40
outstanding shares of ASI Media Pty. Ltd., the intellectual property of the
ASI-9000 Program, and all rights contained in the exclusive Reseller Agreement
for the ACAMS Cabin Management and Communications System. The purchase price
was paid by the issuance of 1,500,000 shares of ASI Entertainment, Inc. common
stock. The exclusive Reseller Agreement provides, among other matters, that ASI
Entertainment Pty. Ltd. shall have the sole and exclusive right on a world wide
basis to purchase ACAMS terminals from ASI Australia for use in the ASI-9000 at
$30,000 each, or such lesser price as mutually agreed from time to time, and
that ASI Australia shall provide all necessary technical support services,
including training, to ASI Entertainment Pty Ltd. or its customers in regard to
such terminals. The Reseller Agreement has a term of 5 years from the date of
execution (January 9, 1996) with an automatic 5 year renewal at the option of
ASI Entertainment Pty. Ltd.

By an agreement of December 16, 1996, ASI Entertainment Pty. Ltd. (prior to
becoming a subsidiary of the Company) purchased from ASIT Australia for the

                                      -17-
<PAGE>


purchase price of $418,358, the hardware and equipment, including aircraft
certification on the Boeing 737 and Boeing 757, relating to the Passenger Video
Systems which had been installed on certain aircraft operated by Air Europa
including 9 moving map displays (the CMA 3200), 9 cabin control units, 9
installation kits and 8 Sony 8.6" monitors. The purchase price was paid by the
issuance of 659,975 shares of ASI Entertainment, Inc. common stock.

On September 30, 1997, ASI Entertainment Pty. Ltd. (prior to becoming a
subsidiary of the Company) and ASIT Australia executed an agreement where ASI
Entertainment Pty. Ltd. purchased certain communications systems and stocks,
including but not limited to, 36 ACAMS I systems, two ACAMS prototype systems,
and 2 VI-4000 Satellite News Units, in exchange for a purchase price of
$1,081,650 payable by the issuance of 1,875,000 shares of common stock of ASI
Entertainment, Inc. and options to acquire 1,875,000 shares of ASI
Entertainment, Inc. common stock for $0.50 per share. These shares were
subsequently assigned by ASIT Australia to certain debtors in payment of
outstanding liabilities owed by ASIT Australia.

On October 9, 1997, ASI Entertainment Pty. Ltd. (prior to becoming a subsidiary
of the Company) and ASI Media Pty. Ltd. executed an agreement where ASI
Entertainment Pty. Ltd. acquired for a purchase price of $328,945 all of ASIM's
right, title and interest to the Media Agreement and the Media Agreement was
canceled and voided. The purchase price was paid by distribution of 375,000
shares to all the beneficiaries of the ASIM Trust except ASI Entertainment Pty.
Ltd. As a result, 375,000 shares of ASI Entertainment, Inc. were issued to
Vision, Inc. and Australian Authorised Investments, Ltd. as the beneficiaries
of the ASIM Trust.

By an agreement dated August 16, 2001, the Company purchased the marketing and
manufacturing rights to the SecurEtag technology from the Research Trust No. 1.
Mr Ron Chapman, the President and a director of the Company, holds a power of
attorney for the trustee of the Research No. 1 Trust. The terms of agreement
provide that the purchase is to be satisfied by the issue of 6,000,000 shares
of the Company's common stock.

The Company has in the past and plans to continue in the future to purchase
products and services from ASIT Australia.

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


                                      -18-
<PAGE>

                                   SIGNATURES

         Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned thereunto duly authorized.

                                     ASI ENTERTAINMENT, INC.


                                     By:   /s/ Ronald J. Chapman
                                           ------------------------------------
                                               Ronald J. Chapman, President

                                     By:  /s/ Philip A. Shiels
                                           ------------------------------------
                                                Principal Financial Officer

         Pursuant to the Securities Exchange Act of 1934, this report has been
signed below by the following persons on behalf of the registrant and in the
capacities and on the dates indicated.

Signature                                 Title                       Date
- - - - ---------                                 -----                   ----


/s/ Ronald J. Chapman                     Director                  9/30/03
- - - - --------------------------------
      Ronald J. Chapman


/s/ Graham O. Chappell                    Director                  9/30/03
- - - - --------------------------------
     Graham O. Chappell


/s/ Philip A. Shiels                      Director                  9/30/03
- - - - --------------------------------
     Philip A.  Shiels


/s/ Richard Mason                      Director                  9/30/03
- - - - --------------------------------
     Richard Mason


/s/ Thomas D. Henderson           Director                  9/30/03
- - - - --------------------------------
     Thomas D. Henderson


/s/ Elizabeth L. Young                Director                  9/30/03
- - - - --------------------------------
     Elizabeth L. Young

                                      -19-
<PAGE>


<                         CERTIFICATIONS

I, Ronald J. Chapman, certify that:

1. I have reviewed this annual report on Form 10-KSB of ASI Entertainment,
Inc.(the "Registrant" or the "Company");

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

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

4. I am responsible for establishing and maintaining disclosure controls
and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the
Registrant and have;

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

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

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

5. I have disclosed, based on my most recent evaluation, to the Registrant's
auditor and the Audit Committee of the Registrant's Board of Directors (or
persons performing the equivalent function):

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

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

6. I have indicated in this annual report whether or not there were
significant changes in internal controls or in other factors
that could significantly affect internal controls subsequent to the date of
my most recent evaluation, including any corrective actions with regard to
significant deficiencies and material weaknesses.


Dated: September 30, 2003

/s/Ronald J. Chapman
---------------------------------------
Ronald J. Chapman, Chief Executive Officer