SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-KSB

(Mark One)

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

                   For the Fiscal Year Ended December 31, 2001

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

        For the transition period from ______________ to _______________.

                           Commission File No. 0-27929

                         WATERFORD STERLING CORPORATION
                 ----------------------------------------------
                 (Name of small business issuer in its charter)

           Nevada                                        62-1655508
---------------------------------        ---------------------------------------
(State or other jurisdiction             (I.R.S. Employer Identification Number)
of incorporation or organization)

                200 S. Knowles Avenue, Winter Park, Florida 32790
                --------------------------------------------------
               (Address of Principal Executive Offices) (Zip Code)

Registrant's Telephone Number, Include Area Code: 407-622-2040

Securities Registered Pursuant to Section 12(b) of the Act:

      Title of Each Class             Name of Each Exchange on Which Registered
              None                                      None


Securities Registered Pursuant to Section 12(g) of the Act:

                          Common Stock, $.01 par value
                        ---------------------------------
                                (Title of Class)

         Check whether the issuer (1) filed all reports  required to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past twelve (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 ninety (90)
days. Yes X No

         Check if  disclosure  of  delinquent  filers in response to Item 405 of
Regulation S-B is not contained in this form, and will not 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. [ ]

         The issuer's revenues for its most recent fiscal year were $84,650.

         As of  March  31,  2001,  20,887,815  shares  of  common  stock  of the
Registrant were outstanding.  As of such date, the aggregate market value of the
common stock held by non-affiliates,  based on the closing bid price on the NASD
Bulletin Board, was approximately $466,612.

                       DOCUMENTS INCORPORATED BY REFERENCE

    Transitional Small Business Disclosure Format:       Yes         No  X
                                                            ----       ------


<PAGE>



                                TABLE OF CONTENTS

                                                                            Page

PART I

         ITEM 1.  DESCRIPTION OF BUSINESS                                      3
         ITEM 2.  DESCRIPTION OF PROPERTIES                                    4
         ITEM 3.  LEGAL PROCEEDINGS                                            4
         ITEM 4.  SUBMISSION OF MATTERS TO A VOTE
                  OF SECURITY HOLDERS                                          4

PART II

         ITEM 5.  MARKET FOR COMMON EQUITY AND
                  RELATED STOCKHOLDER MATTERS                                  4
         ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS                         5
         ITEM 7.  FINANCIAL STATEMENTS                                         6
         ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
                  ON ACCOUNTING AND FINANCIAL DISCLOSURE                       6

PART III

         ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS
                  AND CONTROL PERSONS; COMPLIANCE WITH
                  SECTION 16(a) OF THE EXCHANGE ACT                            6
         ITEM 10. EXECUTIVE COMPENSATION                                       6
         ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
                  OWNERS AND MANAGEMENT                                        7
         ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS               8
         ITEM 13. EXHIBITS AND REPORTS OF FORM 8-K                             8

                  SIGNATURES                                                   9

                  FINANCIAL STATEMENTS                                       F-1




<PAGE>


                                     PART I

ITEM 1.  DESCRIPTION OF BUSINESS

Corporate History

     Waterford Sterling  Corporation,  a Delaware  corporation,  (the "Company")
changed its name from  Skreem.com  Corporation  on January 25, 2001.  Skreem.com
Corporation was formerly  Commerce Centers  Corporation  which was formed in May
1989 but did not have any operations until it acquired Skreem.com Corporation, a
Nevada corporation ("Skreem") in March 1999. Upon the acquisition of Skreem, the
Company  changed  its name from  Commerce  Centers  Corporation  to  "Skreem.com
Corporation". The Company acquired all of Skreem's issued and outstanding shares
of common stock  making  Skreem a  wholly-owned  subsidiary  of the Company.  On
January 25, 2001, Skreem.com  Corporation changed its name to Waterford Sterling
Corporation.  On January 31, 2001, Waterford Sterling acquired all of the issued
and outstanding shares of Waterford Florida,  Inc. (formerly  Waterford Sterling
Corporation) making Waterford Florida a wholly-owned  subsidiary of the Company.
Because of the soft economy and the events of September  11, 2001,  the business
of Waterford Florida has been discontinued.

     Skreem was  formed in 1999 to develop  and  market  computer  and  Internet
related  software.  In February 1999,  Skreem acquired R&R Marketing Group, Inc.
which had the rights to a series of  computer  software  known as Skreem  System
Acceleration. The Skreem software attempts to accelerate the speed of a computer
in relation  to various  computer  programs'  operating  abilities.  The initial
concept  was  aimed  at  allowing  individuals  to  purchase  this  software  to
accelerate  a  computer's  operating  speeds.  The  software  was designed to be
flexible and work with any computer  that is a 486DX or superior and runs either
the Windows 95 or 98 operating  systems.  Skreem began marketing its software in
1999 and is generating revenues from the sale of such software.  Previously, the
efforts of R&R Marketing Group,  Inc. the prior owners of the software,  were on
the  development  of the  software  and not on its  commercialization.  However,
because of the decline in information  technology  budgets and the show sales of
the software, the Company shut down the software business in 2001.

     The Company has had limited success in exploiting the Skreem  software.  In
1999, the Company raised over $999,000  through the sale of shares of its common
stock in a private  placement in an effort to fund the development and marketing
of the "Skreem  System  Acceleration".  These  funds were used to complete  Beta
versions of its products and commence marketing efforts.

     In June 2000,  KeyLabs,  Inc.,  the largest  independent  software  testing
company in the  United  States,  tested  the  Company's  Skreem  Fast!  computer
acceleration  software and determined that the software makes computers clock in
up to 300% faster on many every day personal computer operations.  In July 2000,
the Company  launched its first consumer  software  title,  Skreem Fast!  Skreem
Fast!  is an  acceleration  software  that can  boost the  amount of freed  RAM,
decrease RAM usage and increase read speeds. In July 2000, the Company completed
an Internet  consulting  contract with Grand Slam  Treasures,  Inc.  whereby the
Company  received  150,000  restricted  shares of Grand Slam Treasures,  Inc. In
August 2000,  the Company  entered into a consulting  agreement  with Grand Slam
Treasures,  Inc. whereby the Company received 500,000 restricted shares of Grand
Slam Treasures, Inc. In September 2000, the Company launched its second consumer
software title,  Skreem Net Jet. The Skreem Net Jet software allows users of any
Windows 95/98 PC to surf the web up to 400% faster.

      In July 2000,  the Company had entered  into an  acquisition  agreement to
acquire 100% of Imperial Furnishings  Corporation,  including all rights, titles
and contracts in progress in return for 500,000  shares of Company common stock.
In July 2000,  the Company had also  entered  into an  acquisition  agreement to
purchase Satlink Telcom,  Inc., an Internet and  long-distance  dialing company,
for  100,000  shares of Company  common  stock.  In December  2000,  the Company
unwound  its   acquisition  of  both  Imperial   Furnishings   Corporation   and
SatlinkTelecom,   Inc.  and  returned  the  600,000   shares   issued  for  such
acquisitions to the Company's treasury.

     Upon the Company's  acquisition  of Waterford  Florida in January 2001, the
Company's  principal  operating  business  became the sourcing and  marketing of
furniture and accessories to the  hospitality  and fine store markets.  However,
because of a sharp drop in orders,  this business  became  unprofitable  and was
subsequently discontinued. At present, the Company has no operating business.


                                       3
<PAGE>


Employees

     The Company has one employee.  (See "Directors and Executive Officers.")

ITEM 2. DESCRIPTION OF PROPERTIES

     The  Company  does  not own any  real  property.  The  Company's  principal
executive  offices are located at 200 S. Knowles  Avenue,  Winter Park,  Florida
32789.  These  offices  are  provided,  rent free,  by the  Company's  principal
shareholder  Thomas Tedrow.  The Company  believes that the above facilities are
adequate for the foreseeable needs of the Company.

ITEM 3. LEGAL PROCEEDINGS

     Management is not aware of any pending or threatened litigation against the
Company.

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

     No matters were submitted to a vote of the Company's  stockholders  through
the  solicitation  of proxies,  or otherwise,  during the fourth  quarter of the
Company's fiscal year ended December 31, 2001. During the first quarter of 2001,
a majority of the stockholder  interest consented to changing the Company's name
to Waterford Sterling Corporation.

                                     PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Market Information

       The Company's common stock trades on the  over-the-counter  market on the
National  Association of Securities  Dealers OTC Bulletin Board under the symbol
"WTFD."  The  following  table sets  forth the high and low bid and asked  sales
priced for the periods indicated.

                                       Bid Price
Calendar Year 2001                    High      Low
                                  ---------------------

         Fourth Quarter            $0.1300      $0.0500
         Third Quarter              0.3090       0.1600
         Second Quarter             0.3100       0.1300
         First Quarter              0.5310       0.2500

Calendar Year 2000

         Fourth Quarter             0.9100      0.40625
         Third Quarter              03.125      0.81250
         Second Quarter             3.4375       1.4375
         First Quarter                   -            -

     The  quotations  reflect  inter-dealer  prices,   without  retail  mark-up,
mark-down or commission and may not represent actual transactions.  At March 31,
2002, the bid price of the Common Stock was $.09.

Record Holders

     As of March 31, 2001,  there were  approximately  126 record holders of the
Company's common stock.

Dividends

     The  Company  has never  declared  or paid any cash  dividend on its Common
Stock and does not expect to declare or pay any such dividend in the foreseeable
future.


                                       4
<PAGE>

ITEM 6. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

Year Ended December 31, 2000 Compared to Year Ended December 31, 1999

Revenues.  Revenues  decreased  by $593,718 or 87.5% from  $678,368 for the year
ended  December 31, 2000 to $84,650 for the year ended  December  31, 2000.  The
decrease in revenues was principally due to the absence of software sales in the
current  year and a decline in interest  income  which was  partially  offset by
sales of furniture  in the current  year,  which after costs of furniture  sales
netted $7,298.

General  and  Administrative  Expenses.   General  and  administrative  expenses
increased by $18,015 or .02% from $741,791 for the year ended  December 31, 2000
to $759,806 for the year ended  December  31, 2001.  The increase in general and
administrative  expenses resulted from general increase in prices, although less
than the inflation rate.

Depreciation and Amortization.  Depreciation and amortization  expense decreased
by $918 or 11.2% from $8,193 for the year ended  December 31, 2000 to $7,275 for
the year ended December 31, 2001. This decrease resulted from fewer assets being
depreciated.

Loss on Sale of  Investment.  The Company  incurred a $9,825 loss on the sale of
securities  during the year ended December 31, 2001. It had no gain or loss from
the sale of securities for the prior year.

Extraordinary Item. For the year-ended December 31, 2001, the Company recorded a
non temporary loss of $650,500 from its holdings of Grand Slam  Treasures,  Inc.
(now Asconi Corporation) common stock,  writing down the value of the securities
from  $650,000  to  $19,500  following  a  1:100  reverse  split.  There  was no
extraordinary item for the year ended December 31, 2000.

Other Comprehensive  Income.  Other  comprehensive  income increased by $512,000
from a loss of $312,000 for the year ended December 31, 2000 to $200,000 for the
year ended December 31, 2001.  This increase is  attributable  to an increase in
the Company's stock portfolio during the current year.

Comprehensive  Loss. As a result of the  foregoing,  the Company  incurred a net
comprehensive loss of $1,214,570 for the year ended December 31, 2001,  compared
to a  comprehensive  loss of $387,713 for the year ended  December 31, 2000. The
Company's loss before  extraordinary  items and comprehensive  losses/income was
$784,070  for the year ended  December  31,  2001  compared  to $75,213  for the
year-ended December 31, 2000.

Liquidity and Capital Resources

     Since inception,  the Company has funded its operations and met its capital
requirements through the sale of stock and loans from shareholders.  At December
31,  2001,  the Company had a deficit in working  capital of $419,412 and a cash
balance of $18,192.  This compares to a working capital deficit of $34,938 and a
cash balance of $12,664 at December 31, 2000.

     Cash used by operating  activities was $441,042 for the year ended December
31,  2001  compared to  $496,627  for the year ended  December  31,  2000.  This
consisted of the Company's net  operating  loss of $1,414,570  and a decrease in
accounts   payable  of  $52,413  where  partially  offset  by  depreciation  and
amortization  of $9,462,  loss on sale of investments  of $9,824,  a decrease in
prepaid  expenses of $113,074 the  non-temporary  loss on securities of $630,500
and the  payment of $263,082 of  expenses  with shares of the  Company's  common
stock.

     Cash flows from investing  activities,  totaled  $59,676 for the year ended
December 31, 2001 compared to $10,798 used in inventory  activities for the year
ended  December  31,  2000.  This  consisted  in its  entirety  of the  sale  of
securities available for sale.

     Cash flows from financing  activities  totaled  $386,894 for the year ended
December  31, 2001,  compared to $143,000 for the year ended  December 31, 2000,
all of which came from loans from shareholders.

     The Company has insufficient  capital resources to meet its operating needs
for the next twelve months.  Unless the Company is able to merge with or acquire
a profitable  operating business,  or unless it is able to sell shares or obtain
loans  from its  shareholders,  the  Company  will be unable to  continue  as an
operating entity.

                                       5
<PAGE>

ITEM 7. FINANCIAL STATEMENTS

     The  consolidated  financial  statements of the Company,  together with the
independent auditors' report thereon of Andersen Andersen & Strong LC appears on
pages F-2 through F-10 of this report. See Index to Financial Statements on page
F-1 of this report.

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

     There were no changes in or disagreements with the Company's Accountants on
any  accounting or financial  disclosure  item during any period covered by this
report.

                                    PART III

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

     Information Regarding Present Directors and Executive Officers

     The  names  of the  Company's  executive  officers  and  directors  and the
positions held by them are set forth below:

Name           Age      Title                                    Director Since
----           ---      -----                                    --------------
Jacob Nguyen   28       President, Secretary/Treasurer           1999

         The term of office of each director is one year and until his successor
is elected at the  Company's  annual  shareholders'  meeting  and is  qualified,
subject to removal by the  shareholders.  The term of office for each officer is
for one year and until a successor is elected at the annual meeting of the board
of directors and is qualified, subject to removal by the board of directors.

Biographical Information

     Set forth below is certain biographical information with respect to each of
the Company's officers and directors.

     Jacob  Nguyen is a managing  director of Market  Management  International,
Inc.,  an  investment  research  firm.  Mr.  Nguyen heads a team of analysts and
writers that researches companies from around the world. Previously, he was vice
president of Waterford  Sterling,  Inc., an international  public relations firm
that created media campaigns and advertising for multinational corporations. Mr.
Nguyen has a bachelor's degree in International Economics.

ITEM 10. EXECUTIVE COMPENSATION

         The following tables set forth certain summary  information  concerning
the compensation paid or accrued for each of the Company's last completed fiscal
years to the Company's or its principal subsidiaries chief executive officer and
each of its other  executive  officers that received  compensation  in excess of
$100,000  during such period (as determined at December 31, 2001, the end of the
Company's last completed fiscal year):


                                       6
<PAGE>

Summary Compensation Table

<TABLE>


                           Annual Compensation                            Long Term Compensation

                                                          Awards           Restricted                 Payouts
                                                          ------                                      -------
 Name and Principal                      Other Annual     Stock      Options   LTIP         All other
 Position              Year  Salary    Bonus($)    Compensation     Awards     / SARS    Payout    compensation
 ------------------    ----  ------    --------   ---------------  --------   ---------  -------   -------------
<S>                 <C>      <C>       <C>        <C>              <C>        <C>       <C>        <C>


Jacob Nguyen          2001     0         0           0                 0          0         0              0
President & CEO

                      2000     0         0           0                 0          0         0              0
</TABLE>


Options /SAR Grants in Last Fiscal Year

         The Company has never granted options or stock appreciation rights.

Bonuses and Deferred Compensation

         None

Compensation Pursuant to Plans

         The Company does not have any compensation or option plans.

Pension Plans

         Not applicable

Other Compensation

         None

         Directors receive no compensation except for reimbursement for expenses
associated with attending director meetings.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         The  following  table sets forth the number of shares of the  Company's
Common  Stock,  par value  $0.01,  held by each person who is believed to be the
beneficial  owner of 5% or more of the  shares  of the  Company's  common  stock
outstanding  at March 31, 2001,  based on the Company's  transfer  agent's list,
representations  and affidavits  from  shareholders  and beneficial  shareholder
lists provided by the Depository  Trust and securities  broker dealers,  and the
names and number of shares held by each of the Company's  officers and directors
and by all officers and directors as a group.


 Title of Class     Name and Address of       Amount and Nature of    Percent of
                    Beneficial Owner          Beneficial Ownership     Class
 ---------------    --------------------      --------------------    ----------
Principal Shareholders

Common             Thomas Tedrow
                   200 S. Knowles Avenue
                   Winter Park, Florida 32789       14,359,000          68.743%


<PAGE>

Common             Jeff Martin
                   179 Fairview Point Circle
                   Orlando, Florida 32790            1,163,236           5.569%

Common             Jacob Nguyen
                   200 S. Knowles Avenue
                   Winter Park, Florida 32789          181,000            .886%

All officers and Directors, and as a Group
(1 Person)                                             181,000            .886%


ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         During  February 1998,  the Company  issued  1,585,258 post stock split
shares to five major  stockholders  and two persons who were both  officers  and
directors.  The  consideration  for the issuance was assumption of the Company's
accrued   liabilities   in  the  amount  of  $21,920  by  the  above   mentioned
shareholders,  and the agreement by them to fund future Company  expenditures in
the amount of $4,500.

         The shares issued pursuant to the Waterford Florida,  Inc.  acquisition
agreement  were  issued  to  four  individuals  who  collectively   represent  a
controlling interest of the Company.

         During  May 2000,  the  Company  borrowed  $50,000  from its  President
payable on demand at 8%.

         On September 26, 2000,  the Company  issued 75,000 shares of its common
stock in settlement of the $50,000 note including accrued interest.

         The  Company  has  borrowed   additional  funds  from  related  parties
resulting  in 8% demand  notes  secured by the  Company's  assets  and  treasury
securities as follows at December 31, 2001:

            Notes payable - Stockholder of the Company             $150,955
            Notes payable - Market Management International,
            (a company is which a major stockholder has
            an interest.)                                           329,705
                                                                    -------
                                                                   $480,660
                                                                    =======

                                     PART IV

ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K

(a)      Exhibits


(b)      Reports on Form 8-K

         None




<PAGE>


                                   SIGNATURES

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

                                                   By: /s/ Jacob Nguyen
                                                      --------------------------
                                                       Jacob Nguyen
                                                       Chief Executive Officer

Dated: April 1, 2002

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


     Name                          Title                               Date
    ------                        -------                             -------
                       President, Secretary, Treasurer, Director   April 1, 2002
/s/ Jacob Nguyen
--------------------
Jacob Nguyen



<PAGE>

                         WATERFORD STERLING CORPORATION

                   Index to Consolidated Financial Statements


                                                                           Page
                                                                          ------

Report of Independent Public Accountants

Balance Sheets as of December 31, 2001 and 2000                            F-2

Statements of Operations for the Years Ended
 December 31, 2001 and 2000                                                F-3

Statements of Cash Flows for the Years Ended
 December 31, 2001 and 2000                                                F-4

Statements of Shareholders' Equity for the Years
 Ended December 31, 2001 and 2000                                          F-5

Notes to Financial Statements                                        F-6 - F-9

<TABLE>
<S>                                                           <C>

ANDERSEN ANDERSEN & STRONG, L.C.                              941 East 3300 South, Suite 202
--------------------------------                                  Salt Lake City, Utah 84106
Certified Public Accountants and Business Consultants
Member SEC Practice Section of the AICPA


                                                                     Telephone 801 486-0096
                                                                     Fax 801 486-0098
</TABLE>


               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS


Audit Committee of the
Board of Directors of
Waterford Sterling Corporation
Winter Park, Florida

We have  audited  the  accompanying  consolidated  balance  sheet  of  Waterford
Sterling  Corporation (a development stage company) as of December 31, 2001, and
the related consolidated statements of operations, stockholders' equity and cash
flows for the years ended  December  31, 2001 and 2000,  the period from May 17,
1989 (date of inception) to December 31, 2001.  These  financial  statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audit.

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

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material  respects,  the financial position of Waterford Sterling
Corporation  (a  development  stage  company) as of December 31,  2001,  and the
results of its  operations  and its cash flows for the years ended  December 31,
2001 and 2000,  and the period from May 17, 1989 (date of inception) to December
31, 2001 in conformity  with  accounting  principles  generally  accepted in the
United States of America.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 7 to the
financial  statements,  the Company has suffered recurring operating losses from
its inception  and has very limited  working  capital.  These  conditions  raise
substantial doubt about its ability to continue as a going concern. Management's
plans  regarding  those  matters  are also  described  in Note 7. The  financial
statements do not include any adjustments  that might result from the outcome of
this uncertainty.


March 6, 2002
Salt Lake City, Utah
<PAGE>

                         WATERFORD STERLING CORPORATION
                          (A Development Stage Company)
                           CONSOLIDATED BALANCE SHEET
                                December 31, 2001



                                     ASSETS

CURRENT ASSETS:
  Cash                                                              $    18,192
  Prepaid expense (Note 4)                                               57,479
                                                                    ------------
   Total current assets                                                  75,671

EQUIPMENT:
  Office equipment                                                       40,761
  Accumulated depreciation                                              (20,144)
                                                                    ------------
                                                                         20,617
OTHER ASSETS:
  Organization costs net of amortization                                    390
                                                                    ------------
                                                                    $    96,678
                                                                    ============
                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
  Accrued expenses                                                  $    14,423
  Notes payable - related parties (Note 6)                              480,660
                                                                    ------------
   Total current liabilities                                            495,083

STOCKHOLDERS EQUITY (Deficit):
  Common stock, par value $.01;
   authorized 30,000,0000 shares; issued
   and outstanding 20,887,815 shares                                    208,878
  Capital in excess of par                                            1,353,049
  Deficit accumulated during the
   development stage                                                 (1,960,332)
                                                                    ------------
   Total stockholders' deficit                                         (398,405)
                                                                    ------------
                                                                    $    96,678
                                                                    ============
<PAGE>

                         WATERFORD STERLING CORPORATION
                          (A Development Stage Company)
                      Consolidated Statements of Operations
                     Years Ended December 31, 2001 and 2000
            And May 17, 1989 (Date of Inception) to December 31, 2001
<TABLE>


                                                                             Inception
                                                                                 To
                                       December 31,        December 31,      December 31,
                                          2001                 2000             2001
                                      --------------     -------------     ---------------
<S>                                   <C>                <C>               <C>

REVENUE:
 Sales of software                      $      -           $ 652,458         $  652,458
 Sales of furniture                       77,370                   -             77,370
 Interest income                           7,280              25,910             58,225
                                        ---------          ----------        -----------
                                          84,650             678,368            788,053
COST AND EXPENSES:
 Cost of furniture sold                   70,072                   -             70,072
 Selling, general and
   administrative                        759,806             741,791          1,988,632
Interest                                  21,742               3,597             25,339
Depreciation and
 amortization                              7,275               8,193             24,016
Loss on sale of
 investments                               9,825                   -              9,825
                                        ---------          ----------        -----------
   Total expenses                        868,720             753,581          2,117,884
LOSS BEFORE
 EXTRAORDINARY ITEM
                                        (784,070)            (75,213)        (1,329,831)
                                        ---------          ----------        -----------
EXTRAORDINARY ITEM
 Non-temporary loss on
   securities                           (630,500)                  -           (630,500)
                                        ---------          ----------        -----------
NET LOSS                              (1,414,570)            (75,213)        (1,960,331)

COMPREHENSIVE
 LOSS
   Unrealized gain (loss) on
     available for sale securities       200,000            (312,000)                 -
                                        ---------          ----------        -----------
COMPREHENSIVE
 LOSS                               $ (1,214,570)          $(387,713)       $(1,960,331)
                                       ==========          ==========        ===========
Loss per common share
 before extraordinary item          $       (.04)          $    (.01)
Extraordinary loss per
 common share                               (.03)                  -
                                       ---------          ----------
Net loss per common share           $       (.07)          $    (.01)
                                       =========          ==========
Weighted average shares
 outstanding                          20,293,294          13,653,630
                                      ==========          ==========
</TABLE>


<PAGE>

                         WATERFORD STERLING CORPORATION
                          (A Development Stage Company)
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                     Years Ended December 31, 2001 and 2000
              May 17, 1989 (Date of Inception) To December 31, 2001
<TABLE>

                                                                                   Inception
                                                                                      To
                                               Dec. 31,          Dec. 31,          Dec. 31,
                                                 2001              2000              2001
                                              ----------        ----------        -----------
<S>                                           <C>               <C>               <C>


CASH FLOWS FROM OPERATING ACTIVITIES:
  Net loss                                   $(1,414,571)      $  (75,214)       $(1,960,333)
  Adjustment to reconcile net loss to
  net cash used by operating activities:
  Loss on sale of investments                      9,824                -              9,824
  Depreciation and amortization                    9,462            8,381             20,691
  (Increase)in accounts receivable                     -            6,058                  -
  Bad debt                                             -           12,074             12,074
  Decrease in prepaid expenses                   113,074                -            113,074
  Increase (decrease) in accounts payable        (52,413)          43,780             14,424
  Revenue in non-cash transaction                      -         (650,000)          (650,000)
  Nontemporary loss on securities                630,500                -            630,500
  Expenses paid and debts settled
   with common stock                             263,082           68,846            443,348
  Loss on exchange of notes receivable
   for prepaid rent                                    -           45,200             45,200
  Other expenses incurred in
   non-cash transactions                               -           44,248             44,248
                                               -----------      -----------       -----------
Net cash (Used) by operations                   (441,042)        (496,627)        (1,276,950)
                                               -----------      -----------       -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Sale of securities available for sale           59,676                -             59,676
  Issuance of notes receivable                         -          (62,075)          (290,733)
  Collections on notes receivable                      -           78,658             78,658
  Purchase of marketable securities                    -                -            (50,000)
  Purchase of equipment                                -          (27,381)           (40,761)
  Increase in organization costs                       -                -               (936)
                                               -----------      -----------       -----------
Net cash provided (used)
  by investing activities                         59,676          (10,798)          (244,096)
                                               -----------      -----------       -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from issuance of common
   stock for cash                                      -                -          1,009,344
  Loans from related parties                     386,894          143,000            529,894
                                               -----------      -----------       -----------
Net cash provided from
  financing activities                           386,894          143,000          1,539,238
                                               -----------      -----------       -----------
NET INCREASE IN CASH                               5,528         (364,425)            18,192
Cash, beginning                                   12,664          377,089                  -
                                               -----------      -----------       -----------
Cash, ending                                   $  18,192       $   12,664        $    18,192
                                               ===========      ===========       ===========
</TABLE>

See (Note 8) for supplemental disclosures.
<PAGE>

                         WATERFORD STERLING CORPORATION
                          (A Development Stage Company)
                 Consolidated Statements of Stockholders' Equity
        Period From May 17, 1989 (Date of Inception) To December 31, 2001

<TABLE>

                                                                                         Unrealized
                                    Common       Common      Capital In    Receivable     Gain On
                                    Stock        Stock       Excess Of     On Shares      Securities
                                                                                          Available         Accumulated
                                    Shares       Amount      Par Value     Issued         For Sale           (Deficit)      Total
                                   --------     --------    ------------  ------------   ------------      -------------   -------
<S>                               <C>          <C>         <C>           <C>             <C>                <C>            <C>

Issuance of shares
of common stock on
May 17, 1989 for
professional services
rendered at $.02                 1,200,057     $ 12,001     $  7,999      $       -       $       -              -       $   20,000
Issuance of shares of
common stock during 1966:
  for cash at $.33                  30,000          300        9,700              -               -              -           10,000
  for services at $.33             105,000        1,050       33,950              -               -              -           35,000
Issuance of shares of
common stock during 1998:
for professional
services at $.02                 1,315,258       13,152        8,768              -               -              -           21,920
for commitment to
provide future
capital at $.02                    270,000        2,700        1,800         (4,500)              -              -                -
Issuance of shares of
common stock during
1999 to acquire wholly
owned subsidiary at $.00         9,600,000       96,000      (86,000)             -               -              -           10,000
Issuance of common stock
during 1999 for cash at $.99     1,000,000       10,000      984,344              -               -              -          994,344
Commitment to provide
capital satisfied with
payment of expenses                      -            -            -          4,500               -              -            4,500
Issuance of shares for
services during 1999 at $1.00       25,000          250       24,750              -               -              -           25,000
Net change in unrealized
gain on securities available
for sale                                 -            -           -               -         112,500              -          112,500
Accumulated loss- period
May 17, 1989 to
December 31, 1999                        -            -           -               -               -       (470,547)        (470,547)
                               -------------   ----------  ------------   -----------      ------------ ------------     -----------

Balance December 31, 1999       13,545,315     $135,453    $985,311        $      -        $112,500      $(470,547)        $ 762,717
                               -------------   ----------  ------------   -----------      ------------ ------------     -----------

</TABLE>


<PAGE>
<TABLE>

                                                                                            Unrealized
                             Common           Common         Capital In      Receivable     Gain On
                             Stock            Stock          Excess Of       On Shares      Securities
                                                                                            Available      Accumulated
                             Shares           Amount         Par Value        Issued        For Sale       (Deficit)        Total
                            ---------        --------       ------------     -----------   ------------   -------------    -------
<S>                         <C>             <C>              <C>             <C>           <C>            <C>              <C>

Balance December 31, 1999   13,545,315       $135,453        $985,311       $      -        $112,500       $(470,547)      $762,717
Issuance of common stock
during 2000:
 Settle note payable and
 accrued interest at $.67       75,000            750          49,831              -               -               -         50,581
 For prepaid legal services
 at $.30                       200,000          2,000          58,000              -               -               -         60,000
 For services at $1.00          67,500            675          66,825              -               -               -         67,500
Net change in unrealized
gain (Loss) on securities
available for sale                   -              -               -              -        (312,500)              -       (312,500)
Net loss year ended
December 31, 2000                    -              -               -              -               -         (75,214)       (75,214)
Balance December 31, 2000   13,887,815        138,878       1,159,967              -        (200,000)       (545,761)       553,084
                            ------------   ------------     ------------   -----------     ------------    ------------  -----------
Issuance of common stock
during 2001:
 Debts settled and expenses
 paid at $.04                7,000,000         70,000        193,082               -               -               -        263,082
Net change in unrealized
gain (Loss) on securities
available for sale                   -              -              -               -         200,000               -        200,000
Net loss year ended
December 31, 2001                    -              -              -               -               -      (1,414,571)    (1,414,571)
                           -------------   ------------     ------------   ------------   -------------   -----------    -----------

Balance December 31, 2001   20,887,815       $208,878      $1,353,049      $       -        $      -     $(1,960,332)   $  (398,405)
                           =============   ============     ============   ============   =============   ===========    ===========
</TABLE>

<PAGE>
                         WATERFORD STERLING CORPORATION
                          (A Development Stage Company)
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001

1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BUSINESS ACTIVITY

Business activity

The Company,  a Delaware  corporation  was  incorporated on May 17, 1989, and is
currently in the  development  stage.  The Company sought to acquire and develop
high technology  software firms,  and to engage in the sourcing and marketing of
furniture and accessories to the  hospitality  and time share market.  Currently
the Company is exploring other business possibilities.

In April 1999 the Company changed its name from Commerce Centers  Corporation to
Skreem.com  Corporation  and  approved  a  reverse  stock  split of 3 shares  of
outstanding  stock for 5 shares.  The report has been  prepared  as if the stock
split had occurred at inception.

In January  2001 the Company  changed its name from  Skreem.com  Corporation  to
Waterford Sterling Corporation.

Accounting method

The Company's  financial  statements  are prepared  using the accrual  method of
accounting.

Principles of consolidation

The  consolidated  financial  statements  include  the  accounts  of  Skreem.com
Corporation and Waterford Florida, Inc., both Nevada corporations.  All material
intercompany transactions have been eliminated.

Computer software costs

The  Company  expenses  research  and  development  costs  related  to  software
development  that  has  not  reached   technological   feasibility  and  started
production  for sale.  Thereafter  costs are  capitalized  and amortized  over a
maximum of five years or expected life of the product, whichever is less.

Income (loss) per share

The  computation  of income  (loss)  per  share of common  stock is based on the
weighted average number of shares outstanding, after the stock split.

Statement of cash flows

The Company  considers  all highly  liquid  debt  instruments  purchased  with a
maturity  of three  months or less to be cash  equivalents  for  purposes of the
statement of cash flows.

<PAGE>


                         WATERFORD STERLING CORPORATION
                          (A Development Stage Company)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001



1.   SUMMARY  OF   SIGNIFICANT   ACCOUNTING   POLICIES  AND  BUSINESS   ACTIVITY
     (continued)

Financial instruments

The  Company  estimates  that the fair  value of all  financial  instruments  at
December 31, 2001 do not differ materially from the aggregate carrying values of
its financial instruments recorded in the accompanying balance sheets.

Dividend policy

The Company has not yet adopted a policy regarding payment of dividends.

Estimates and assumptions

Management uses estimates and assumptions in preparing  financial  statements in
accordance with generally accepted  accounting  principles.  Those estimates and
assumptions  affect the  reported  amounts of the  assets and  liabilities,  the
disclosure of contingent  assets and liabilities,  and the reported revenues and
expenses.  Actual  results  could vary from the  estimates  that were assumed in
preparing these financial statements.

Marketable securities:

Certain  equity  securities  are  classified as available for sale as defined by
SFAS 115. In accordance with that Statement, they are reported at aggregate fair
value with unrealized  gains and losses excluded from earnings and reported as a
separate component of stockholders' equity.

2.   INCOME TAXES

The Company complies with Statement of Financial  Accounting  Standards No. 109,
Accounting  for  Income  Taxes.  At  December  31,  2001 the  Company  had a net
operating  loss ("NOL")  carry  forward for United States income tax purposes of
approximately  $1,304,000.  The NOL carryforward expires in increments beginning
in 2004.  The Company  also had a net capital loss  carryover  of  approximately
$640,000.  The Company's  ability to utilize its net NOL carryforward is subject
to the  realization  of  taxable  income in  future  years,  and  under  certain
circumstances,  the Tax Reform Act of 1986 restricts a corporation's  use of its
NOL carryforward.  The Company believes that there is at least a 50% chance that
the carryforward  will expire unused,  therefore,  any tax benefit from the loss
carryforward has been fully offset by a valuation reserve.

<PAGE>


                         WATERFORD STERLING CORPORATION
                          (A Development Stage Company)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2001


3.   ACQUISITION OF SUBSIDIARIES

In April  1999 the  Company,  Skreem.com  Corporation,  a  Delaware  corporation
("SCD")  acquired all of the  outstanding  stock of  Skreem.com  Corporation,  a
Nevada  corporation  ("SCN")  through a stock for  stock  exchange  in which the
stockholders of SCN received 9,600,000 post stock split
 common  shares  of the  SCD in  exchange  for  all of  the  stock  of the  SCN.
Skreem.com  Corporation  ("SCN") was  incorporated in Nevada on January 29, 1999
for the purpose of developing high technology software.

For reporting  purposes,  the  acquisition  is treated as an  acquisition of the
Company   ("SCD")  by  Skreem.com   Corporation  of  Nevada   ("SCN")   (reverse
acquisition)  and a  recapitalization  of  SCN  with  its  historical  financial
statements being combined with the Company's.  No proforma  statements have been
included since the acquisition is considered to be a reverse acquisition.

On January 31,  2001,  the  Company  executed  and  Exchange  Agreement  for the
acquisition of all of the issued and  outstanding  shares of Waterford  Florida,
Inc. in exchange for 7,000,000  share of the Company's  common stock.  Waterford
Florida,  Inc. is currently  engaged in the sourcing and  marketing of furniture
and accessories to the hospitality and time share market,  however,  at the date
of acquisition it had not commenced this activity.

4.   PREPAID EXPENSE

The Company leases office space under a noncancellable operating lease agreement
effective  January 1, 2001 which expires  December 31, 2002. The Company prepaid
the rent for the two years specified in the lease agreement.  Consideration  for
the  prepayment was based on the present value of 24 months at $5,000 per month,
discounted  at 8% or  $110,553.  Prepaid  rent  expense at December 31, 2001 was
$57,479.

5.   MARKETABLE SECURITIES

The Company owned 650, 000 shares of Grand Slam  Treasures with an original cost
of $650,000  based on the market value of the stock at the date of  acquisition.
During the period ended March 31, 2001 Grand Slam Treasures changed its name and
adopted a reverse stock split of 100 to 1 for its common shares. The approximate
market  value of this  security  at March  31,  2001 was  $19,500.  The  Company
considered this change in value to be of a non-temporary  nature and accordingly
recorded a loss of $630,500,  thereby  establishing a new cost basis of $19,500.
The  Company  sold the shares  during May and June for  $46,438  resulting  in a
realized gain of $26,938.

Proceeds from the sale of securities  available for sale totaled $59,676 for the
year ended December 31, 2001, on which gross losses of $9,825 were realized.

<PAGE>

6.       RELATED PARTY TRANSACTIONS

During  February 1998,  the Company issued  1,585,258 post stock split shares to
five major  stockholders  and two persons who were both officers and  directors.
The  consideration  for the issuance was  assumption  of the  Company's  accrued
liabilities in the amount of $21,920 by the above  mentioned  shareholders,  and
the  agreement  by them to fund  future  Company  expenditures  in the amount of
$4,500.

The shares issued pursuant to the  acquisition  agreement as described in note 3
were  issued  to four  individuals  who  collectively  represent  a  controlling
interest of the Company.

During May 2000,  the Company  borrowed  $50,000 from its  President  payable on
demand at 8%.
On September 26, 2000,  the Company  issued 75,000 shares of its common stock in
settlement of the $50,000 note including accrued interest.

The Company has borrowed  additional funds from related parties  resulting in 8%
demand notes secured by the Company's assets and treasury  securities as follows
at December 31, 2001:

              Notes payable - Stockholder of the Company             $150,955
              Notes payable - Market Management International,
              a company is which a major stockholder has
              an interest.                                            329,705
                                                                      -------
                                                                     $480,660
                                                                      =======

7.   GOING CONCERN

The Company has suffered  recurring  operating  losses from its  inception.  The
Company intends to acquire interests in various business opportunities which, in
the opinion of management, will provide a profit for the Company, however, there
is  insufficient  working capital to service its debt and for any future planned
activity.  Continuation  of the  Company as a going  concern is  dependent  upon
obtaining  additional  working  capital  for any  future  planned  activity  and
management  of the Company  will be  required  to develop a strategy  which will
accomplish this objective.

8.   SUPPLEMENTAL CASH FLOW DISCLOSURES

                                                                    Inception to
                                             Dec. 31,    Dec. 31,    Dec. 31,
                                              2001         2000        2001
                                             --------    ---------   -----------
Non-cash operating and financing activities:
 Non-cash sales                              $      -    $650,000     $650,000
                                              =========   =======      ========
 Other non-cash operating expenses           $      -    $ 89,448     $ 89,448
                                              =========   =======      ========
 Issuance of common stock for expenses       $263,082    $ 68,846     $443,348
                                              =========   =======      ========
 Issuance of common stock for note payable   $      -    $ 50,000     $ 50,000
                                              =========   =======      ========

<PAGE>

9.   COMMITMENTS

The Company leases office space under a noncancellable operating lease agreement
effective  January  1, 2001 which  expires  December  31,  2002.  Minimum  lease
payments  of $60,000  per year for 2001 and 2002 are  required.  The Company has
prepaid this obligation (refer to note 4).