<PAGE>

                     U.S. 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 December 31, 2003

[ ] 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.: 0-22936

                              Crown NorthCorp, Inc.
                             ----------------------
                 (Name of small business issuer in its charter)

                        Delaware                     22-3172740
                        --------                     ----------
             (State or other jurisdiction of      (I.R.S. Employer
              incorporation or organization)      Identification No.)

                     1251 Dublin Road, Columbus, Ohio 43215
                  --------------------------------------------
               (Address of principal executive offices) (Zip Code)

                                 (614) 488-1169
                          ---------------------------
                          (Issuer's telephone number)

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

                                      NONE

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

                     Common Stock, par value $.01 per share

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

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

         Issuer's revenues for the fiscal year ended December 31, 2003 were
$1,015,439.

         The aggregate market value of the voting and non-voting common equity
held by non-affiliates of the Registrant cannot be determined at this time as
the company's common equity has not been quoted within the past sixty days on
the OTC Bulletin Board pursuant to Rule 6530 of the National Association of
Securities Dealers.

         As of March 20, 2004 the issuer had 14,056,106 shares of its common
stock outstanding.

         Transitional Small Business Disclosure Format. Yes [ ] No [X]

<PAGE>

                              CROWN NORTHCORP, INC.

                                   FORM 10-KSB
                      FOR THE YEAR ENDED DECEMBER 31, 2003
                                      INDEX

<TABLE>
<CAPTION>
                                                                                           PAGES
                                                                                           -----
<S>        <C>                                                                           <C>
           PART I.

Item 1.    Description of Business...................................................          1

Item 2.    Description of Property...................................................          3

Item 3.    Legal Proceedings.........................................................          3

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......................................................    F-1 thru F-23

Item 8.    Changes in and Disagreements with Accountants on Accounting and Financial
           Disclosure................................................................         13

Item 8a.   Procedures and Controls...................................................         13

           PART III.

Item 9.    Directors, Executive Officers, Promoters and Control Persons; Compliance
           with Section 16(a) of the Exchange Act....................................         13

Item 10.   Executive Compensation....................................................         16

Item 11.   Security Ownership of Certain Beneficial Owners and Management............         17

Item 12.   Certain Relationships and Related Transactions............................         18

Item 13.   Exhibits and Reports on Form 8-K..........................................         20

Item 14.   Principal Accountant Fees and Services....................................         21
</TABLE>

<PAGE>

PART I

ITEM 1. - DESCRIPTION OF BUSINESS

BUSINESS OVERVIEW

Crown NorthCorp, Inc. provides comprehensive financial services to the real
estate industry. In recent years, these services have included third-party asset
management and loan servicing for holders of commercial real estate interests in
the United States. Effective December 31, 2003, the company acquired by merger
Royal Investments Corp., the stock of which was owned by Crown's chairman and
chief executive officer. See "Item 12 - Certain Relationships and Related
Transactions" below. Through this transaction, the company has acquired Crown
NorthCorp Limited ("CNL"), a corporation under the laws of the United Kingdom,
which, through Crown Mortgage Management ("CMM") and other operating
subsidiaries, is actively engaged in the management and servicing of commercial
and residential real estate interests in Europe as well as the origination of
certain non-conforming residential mortgage loans. The merger represents a
significant expansion of the company's business.

Crown operates through its corporate headquarters in Columbus, Ohio and an
office in Austin, Texas. European operations are conducted through offices in
London, Ipswich and Farnham in the United Kingdom. Affiliates conduct operations
in Sweden and Belgium. Incorporated under Delaware law, the company was formed
in 1994 through the combination of Crown Revenue Services, Inc. and NorthCorp
Realty Advisors. At December 31, 2003, Crown had eight full-time, direct
employees. Affiliates engaged in asset management overseen by Crown in the
United States employed an additional 43 people. The European subsidiaries
employed 37.

The company receives revenues primarily from agreements pursuant to which Crown
manages commercial, multifamily and residential real estate and loan assets for
the accounts of others; services on an active or standby basis individual loans,
loan portfolios and assets in securitized transactions; performs risk management
and financial advisory services; and administers the interests of various
corporations, partnerships, trusts and special-purpose entities. These
management and servicing contracts may provide for Crown to receive recurring
management or servicing fees, disposition fees associated with transactions and
incentive fees based on the overall performance of particular assets under
management.

Third-Party Asset Management. Crown manages real estate and financial assets as
well as ownership interests in real estate for clients including partnerships,
investment consortiums, financial institutions and governmental entities. Laws
and regulations pertaining to U.S. government subsidies and tax credits
significantly impact many of the domestic assets under the company's management.
Government subsidies or programs typically do not directly affect assets managed
in Europe. Managed assets frequently present multifaceted financing structures
or other complex issues. Clients often refer to Crown assets that are not
performing

                                       1
<PAGE>

to expectations or that do not relate to the client's core business activities.
In a typical engagement, Crown seeks to enhance the value of such assets through
intensive management leading to a financial restructuring or repositioning in
the marketplace. The company's asset management contracts are generally for
indefinite terms.

In recent years, Crown has significantly consolidated its asset management
operations in the United States, focusing on management and advisory services to
holders of interests in multifamily projects receiving government subsidies and
to entities owning tax-exempt bonds or securitized interests in such
instruments. With the acquisition of CNL, Crown's asset management work has now
expanded to include several portfolios of commercial and residential real estate
interests in Europe.

Loan Servicing. Crown's domestic operations service loans and other assets and
interests related to commercial real estate. In Europe, Crown's servicing
activities encompass residential, commercial and consumer portfolios. The
company's customers include individual clients, investors in securitized
transactions and portfolio managers and advisors: many of these relationships
derive from the company's asset management and loan origination activities.
Crown's highly developed servicing systems and procedures have been reviewed by
internationally recognized rating agencies. Fitch Ratings has rated Crown's
commercial servicing operations in the U.S. In Europe, Fitch and Standard &
Poor's Corporation have rated CMM's commercial and residential servicing: Crown
is the only entity operating in Europe to achieve these multiple ratings.

Loan servicing activities include primary servicing of loans performing
according to their contractual terms, special servicing of distressed loans and
standby servicing relationships calling for Crown to step in if another primary
servicer fails. In Europe, the company has entered into a joint venture to
develop master servicing business: master servicers supervise and administer the
activities of multiple primary servicers involved in a common transaction.

Loan Origination. Last year, one of Crown's European subsidiaries commenced a
program to originate non-conforming residential loans for immediate sale into
conduit or correspondent programs that accumulate loans for further disposition
in capital markets transactions.

COMPETITIVE ENVIRONMENT

Over an extended period, Crown's limited financial resources have constrained
its ability to compete for new financial service business. Management believes
that the acquisition of Royal's European operations enhances the company's
financial resources and improves its competitive position. Nevertheless, Crown
continues to face a large number of competing providers of financial services,
the great majority of which are much larger and better capitalized. Crown's
relatively small size and modest financial resources mean that the company must
often develop business alliances or capital partnerships to pursue many
opportunities in the marketplace. At the same time, the company can offer to
particular niches of the domestic and European real estate markets benefits
attendant to Crown's smaller size

                                       2
<PAGE>

such as the ability to deliver highly tailored asset management, loan servicing
and reporting services. The company's ability to operate as a rated servicer in
both the United States and Europe offers possible competitive advantages as
well.

ITEM 2. - DESCRIPTION OF PROPERTY

OFFICES

Crown leases space for its corporate headquarters in Columbus, Ohio. It also
leases office space in Austin, Texas as well as in three locations in the United
Kingdom and additional locations in Sweden and Belgium. See "Note 6 - Leases -
to the Consolidated Financial Statements."

INVESTMENT POLICIES

Real Estate; Interests in Real Estate; Entities Primarily Engaged in Real Estate
Activities. As a third-party asset manager, the company manages real estate and
interests in real estate for the accounts of others. While the company generally
does not invest for its own account in real estate, real estate interests or in
entities engaged in real estate activities, Crown has made and will continue to
make such real estate-related investments - typically in the form of equity or
subordinated debt -- in circumstances where management believes them to be
prudent to secure or retain asset management and servicing business. Crown's
liquidity and capital resources affect its ability to make these types of
investments at any particular time.

Real Estate Mortgages. Crown is not originating or investing in mortgage loans
for its own account. One of Crown's European subsidiaries originates
non-conforming residential real estate loans for sale at closing and delivery
into securitizations or whole loan sale programs. These mortgage banking
activities complement and support the company's third-party asset management and
loan servicing businesses.

The company from time to time has acquired the rights to service mortgage loan
assets through the negotiated purchases of or successful bids for the servicing
rights themselves. Here again, Crown's liquidity and capital resources may limit
its ability to pursue purchases of servicing rights.

ITEM 3. - LEGAL PROCEEDINGS

In 1999, Crown entered into an agreement with Univest Financial Group, LLC, now
by merger Midland Loan Services, Inc., whereby Crown licenses from Midland
software to operate Crown's loan servicing system. As a result of Crown's
contributions to the development of the software, the company has the use of the
present system at no cost. While this use is not in dispute, in October 2003
Crown made an arbitration demand against Midland. The arbitration proceeding,
filed with the American Arbitration Association

                                       3
<PAGE>

pursuant to the terms of the software license agreement, seeks to resolve a
dispute with Midland over the terms and conditions of Crown's use of future
improvements to the system.

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

None.

                                     PART II

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

COMMON STOCK

Records maintained by the National Quotation Bureau show that, for the quarter
ended March 31, 2001, the high and low bid prices for the company's common stock
we $.02 and $.005 respectively. These quotations reflect inter-dealer prices,
without retail mark-up, mark-down or commission and may not represent actual
transactions. In periods subsequent to March 31, 2001, there has generally been
no active public trading market for the common stock.

At March 20, 2004, there were approximately 2,600 holders of record of shares of
the common stock.

During its 2003 and 2002 fiscal years, the company neither declared nor paid
cash dividends or returns of capital on common shares.

Crown does not anticipate paying dividends on the common stock in the
foreseeable future. Instead, management anticipates that any earnings will be
used in the operations of the company.

As of March 20, 2004, Crown had 30,000,000 authorized shares of common stock and
1,000,000 authorized shares of preferred stock.

As part of a series of transactions to effect the merger of Royal into the
company, Crown is proceeding with a 1:100 reverse and 10:1 forward stock split
effective December 31, 2003 to reduce the number of shareholders with extremely
small holdings of the company's stock. Following the stock splits and the
conversion of all outstanding preferred stock to common (but before giving
effect to the merger transaction) Crown had approximately 3,250,116 shares of
common stock outstanding. In exchange for all of the issued and outstanding
stock of Royal, Mr. Roark, Crown's chairman and chief executive officer,
received 12,000,000 shares of Crown common stock. The common stock of Crown held
by Royal became treasury stock of Crown.

                                       4
<PAGE>

ITEM 6. - MANAGEMENT'S DISCUSSION AND ANALYSIS

THE COMPANY'S BUSINESSES

Crown provides the real estate industry with comprehensive financial services.
In the United States, the company offers third-party asset management and loan
servicing to holders of interests in commercial real estate. With the
acquisition of CNL effective December 31, 2003 through the merger with Royal,
Crown has significantly expanded its business to include management and
servicing of commercial and residential real estate interests and financings in
Europe. Crown receives revenues for the financial services it provides in the
form of third-party asset management and disposition fees, loan servicing fees,
interest and investment income. Continuing the trend begun in 2002, U.S.
revenues in 2003 increased over the prior year. Management anticipates that the
addition of European operations will significantly increase the company's future
revenues.

As Crown's U.S. business volumes decreased in recent years, the company
restructured operations to better align operating expenses with lower revenues.
Consequently, while the company continues to operate at a loss, these losses in
the past two years have been steadily and significantly reduced. While recent
efforts to increase business in the U.S. have met with limited success, the
company has now appreciably expanded its core financial services through the
acquisition of CNL and its well-established asset management and loan servicing
activities in Europe. This additional business significantly increases the
likelihood that the company will begin to operate profitably in the near future.
While management is encouraged by this prospect, at the same time, Crown
continues to actively consider additional acquisitions, strategic alliances,
business combinations or other arrangements or transactions that would further
maximize the value of its core businesses and improve operating results.

FORWARD LOOKING STATEMENTS

The statements contained in this report that are not purely historical are
forward-looking statements within the meaning of Section 21E of the Exchange
Act, including statements regarding the company's expectations, hopes,
intentions or strategies regarding the future. Forward-looking statements
include terminology such as "anticipate," "believe," "has the opportunity,"
"seeking to," "attempting," "appear," "would," "contemplated," "believes," "in
the future" or comparable language. All forward-looking statements included in
this document are based on information available to the company on the date
hereof, and the company assumes no obligation to update any such forward-looking
statements. It is important to note that the company's actual results could
differ materially from those in such forward-looking statements. The factors
listed below are among those that could cause actual result to differ materially
from those in forward-looking statements. Additional risk factors are listed
from time to time in the company's reports on Forms 10-QSB, 8-K and 10-KSB.

Among the risk factors that could materially and adversely affect the future
operating results of

                                       5
<PAGE>

the company are:

-        Even though its revenue base has expanded, Crown continues to have
         limited liquidity. For the company to successfully operate, it must
         improve its liquidity through profitable operations, further increases
         in revenues, infusions of capital, reduced expenses or other means.

-        Crown's restructuring and downsizing of U.S. operations have
         significantly reduced operating losses. The acquisition of CNL and its
         profitable operations increases the likelihood that the company as a
         whole will achieve operating profitability, but there can be no
         assurance of this result.

-        While Crown's business volumes in Europe are generally increasing, its
         domestic business is not growing. If the company cannot successfully
         expand or redeploy its U.S. business operations, Crown's ability to
         sustain profitable operations will be impaired.

-        Crown's capital resources are very limited when compared to those of
         many of its competitors. The company may not be able to compete for
         business if it cannot increase its capital resources through profitable
         operations, strategic alliances or combinations, the raising of
         additional capital or other means.

-        Crown operates as a rated servicer. If Crown were to no longer be
         rated, there would be an adverse effect on the company's current
         business. Additionally, Crown's ability to obtain new business in
         certain commercial and residential real estate markets would be
         impaired.

OUTLOOK

In the U.S., Crown offers third-party asset management and loan servicing that
meets the specialized needs of holders of interests in commercial and
multifamily real estate. As compared to the prior year, 2003 saw an increase in
revenues and a decrease in operating losses. Domestic business volumes are
presently not growing, although they do remain generally stable. Management
believes there may be new opportunities to manage and service distressed
commercial real estate as a result of increased delinquency levels in many asset
classes. At the same time, the present environment of low prevailing interest
rates, coupled with regulatory and other factors impacting certain assets
presently under the company's management, may ultimately lead to a repositioning
of various managed assets and a redeployment of asset management and loan
servicing resources.

European real estate markets are making growing use of capital markets
transactions, including mortgage backed securitizations. Investors require
extensive data on the real estate assets underlying such transactions. CNL has
been a market leader in Europe in servicing and

                                       6
<PAGE>

believes it is well positioned to secure additional business as the market
continues to expand. Additionally, the company anticipates that regulatory and
economic forces in Europe will lead many financial institutions to either
outsource or cease to provide certain services they have traditionally offered.
Crown believes it can fill market niches created by this process.

Crown domestic asset management business continues to concentrate on two primary
areas: the management of real estate or ownership interests significantly
impacted by government programs, subsidies or regulations; and the management of
interests in tax-exempt bonds.

The company manages partnership interests and assets associated with several
multifamily projects receiving government subsidies and is actively working to
reposition those projects. Partnerships Crown controls have securitized four
tax-exempt bonds. The company retains a residual interest in the securitization
and services the bonds for the trustee of the issuance. Crown is actively
analyzing opportunities to realize value from this residual interest. The
company also manages tax-exempt bonds for a financial institution and is
pursuing additional opportunities in this area.

Asset management activities in Europe are varied and include a chain of grocery
stores in Sweden, a golf course in the United Kingdom, numerous parcels of
residential real estate and various other real estate and loan interests.
Crown's European operations have secured significant asset management business
from the privatization of formerly government-held assets as well as the desire
of certain entities to no longer have real estate holdings as part of their core
business. Management anticipates the company will be able to continue to secure
business as a result of these trends.

The company's domestic loan servicing activities are concentrated on loans and
securitizations related to commercial real estate. Crown's U.S. operation has
upgraded its loan servicing and computer operating systems over the past two
years and is seeking additional servicing business. The company continues to
operate as a rated servicer in the U.S. and is actively engaged in efforts to
remain rated.

In Europe, Crown services a variety of commercial, multifamily and residential
loans. The company also receives fees to serve as the standby servicer for
several transactions, mainly in the residential market. The company and a
partner are developing a master servicing business. Crown is the only loan
servicer operating in Europe to receive multiple ratings for both commercial and
residential servicing from two rating agencies. Management believes that, to a
greater extent than in the past, new servicing opportunities in Europe will call
for rated servicers.

The company has historically expended significant operating funds to develop and
sustain the human and technological resources necessary to provide sophisticated
asset management services and loan servicing to its customers. Similar
expenditures will continue to be a high priority in the future.

                                       7
<PAGE>

Crown's mortgage banking in Europe is in its early stages, having commenced the
origination in 2003 of non-conforming residential loans for loan conduit and
correspondent programs. Crown is seeking to expand this residential loan
activity and to commence the origination of commercial loans.

Limited liquidity and capital resources constrain the company's ability to
operate and grow its businesses. Crown's low liquidity levels have resulted
primarily from a protracted period of low revenues, restructuring activities
that settled or compromised various obligations, repayment of debt and recurring
operating losses. The company believes that the acquisition of CNL provides a
platform for increased revenues and a return to operating profitability. Until
the company can demonstrate improved operations to the investment community, it
will continue to rely on affiliates for such investment capital as may be
necessary. In recent years, the company has received a series of capital
infusions from related parties.

Expanding its core asset management and servicing activities to include
profitable operations already well under way in Europe opens a new chapter for
Crown. The company now intends to utilize its presently limited liquidity and
capital resources to attempt to maximize opportunities arising from this
expanded base of business. There can be no assurance that the efforts Crown is
undertaking will lead to profitable operations or be otherwise successful.

RESULTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2003 COMPARED TO THE YEAR
ENDED DECEMBER 31, 2002.

Since the acquisition of CNL and its operating subsidiaries through the merger
of Royal into Crown was effective December 31, 2003, results of operations do
not include acquired European operations. See, however, "Acquisitions" under
"Note 1 - Business Description and Significant Accounting Policies - to
Consolidated Financial Statements" for unaudited pro forma consolidated results
of operations as if the acquisition had occurred at the beginning of 2002 and
2003.

Total revenues from continuing operations increased $250,169 to $1,015,439 in
2003 from $765,270 in 2002, with the largest increases being attributable to
management fees and interest income.

Management fees are recorded as services required under a contract are performed
and, as defined in the applicable contracts, are derived either from percentages
of the aggregate value of assets under management or from original base monthly
amounts. Management fees increased $142,149 to $637,358 in 2003 from $495,209 in
2002. The increase in management fee revenue for the twelve months ending
December 31, 2003 is due in large measure to the resolution of one of the assets
under Crown's management during the second quarter of 2003.

Loan servicing fees decreased $3,143 to $111,256 in 2003 from $114,399 in 2002.
This decrease is due primarily to the reduction of the servicing portfolio due
to normal amortization and to payoffs.

                                       8
<PAGE>

Interest income increased $183,462 from $72,423 in 2002 to $255,885 in 2003. The
majority of the increase is attributable to the receipt of cash from a residual
interest in a tax-exempt housing bond owned by one of Crown's subsidiaries. The
receipt of cash came as the result of the sale of one of the underlying
collateral properties of the bond during the second quarter of 2003.

Income from partnerships and joint ventures decreased $39,502 to $6,222 in 2003
from $45,724 in 2002. The majority of the decrease is due to the final
settlement of a joint venture that occurred during the first quarter of 2002.

Other income decreased $32,797 from $37,515 in 2002 to $4,718 in 2003. The
decrease was attributable to several one-time transactions which occurred in
2002, the largest of which was the receipt of $14,000 for the reimbursement of
2001 expenses.

Operating and administrative expense changes were as follows:

<TABLE>
<CAPTION>
                                       2003             2002            $ Change       % Change
                                       ----             ----            --------        --------
<S>                                 <C>              <C>                <C>            <C>
Personnel                           $  607,170       $  549,774         $ 57,396          10
Insurance, Professional and Other   $  424,262       $  331,989         $ 92,273          27
Occupancy                           $  119,072       $   78,868         $ 40,204          51
Amortization and Depreciation       $   58,023       $  148,217        ($ 90,194)        (61)
Minority Interest                   $        0       $    5,999        ($  5,999)        100
Total                               $1,208,527       $1,114,847         $ 93,680           8
</TABLE>

Personnel expenses increased $57,396 from $549,774 in 2002 to $607,170 in 2003.
Increased personnel expenses were primarily due to the addition of contract
personnel associated with the Midland arbitration.

Insurance, professional and other costs increased by $92,273 to $424,262 in 2003
from $331,989 in 2002. This increase was primarily attributable to a $50,000
increase in corporate insurance and a $23,000 increase in legal expense, the
majority of which was incurred at the subsidiary level in conjunction with the
sale of the bond collateral. Also contributing to the increase was the expensing
of approximately $13,400 of capitalized servicing costs due to unanticipated
loan payoffs. Increases in postage, supplies and moving expenses accounted for
the remainder of the increase.

Occupancy cost increased $40,204 from $78,868 in 2002 to $119,072 in 2003. The
increase was attributable in part to the discounted settlement of vendor
payables in 2002 totaling approximately $37,000. The remainder of the increase
was due to increases in office rent.

                                       9
<PAGE>

Amortization and depreciation decreased $90,194 to $50,023 in 2003 from $148,217
in 2002. The decrease is, for the most part, the result of goodwill being fully
amortized in 2002 and to the fact that an ever increasing percentage of the
Company's fixed assets are becoming fully depreciated.

Minority interest in earnings of subsidiary decreased to $0 in 2003 from $5,999
in 2002. This decrease is the result of the purchase of the minority interest by
one of the Company's subsidiaries.

Other comprehensive income decreased to $926 in 2003 from $50,284 in 2002. As
discussed under "Other Investments" in Note 1 to the Consolidated Financial
Statements, comprehensive income represents the accreting portion of a residual
interest in a securitization of tax-exempt bonds and as a result of the sale of
a portion of the underlying collateral of the tax-exempt bonds, an adjustment to
comprehensive income was required.

Interest expense increased $11,777 from $8,265 in 2002 to $20,042 in 2003. The
increase is due to an increase in borrowings during the year.

LIQUIDITY AND CAPITAL RESOURCES

As a result of the acquisition of CNL, cash and cash equivalents increased by
$2,034,733 to $2,052,065 in 2003 from $17,332 in 2002. The company's domestic
and European operations presently have no bank credit facilities. Crown seeks to
improve liquidity and access to cash resources by generating new business
revenues, raising additional capital and, in selected instances, entering into
strategic alliances.

Management anticipates that the results of its operations for the coming year
will be sufficient to fund its operating obligations. However, the company will
continue to seek to expand revenues from its existing client base while
endeavoring to develop new sources of revenue.

HISTORICAL CASH FLOWS

Cash flows from operating activities required the use of $68,448 in 2003.
Operating activities used $198,437 in 2002. The slight improvement in use of
funds was primarily the result of the reduced net loss in 2003.

Investing activities provided cash of $1,801,663 in 2003. Similar activities
used $4,952 in 2002. The 2003 increase was the result of the cash acquired in
the corporate acquisition referred to above reduced by the purchase of a new
computer network as well as the purchase of the minority interest in a
subsidiary. The increase in 2002 was due primarily to the reduction of the
restricted cash reserve account.

                                       10
<PAGE>

Financing activities provided $301,518 in cash in 2003. In 2002, financing
activities provided $202,703 of cash. The increase in 2003 was the result of a
net increase in notes payable. The sources of cash in 2002 included $115,000
from borrowings and $120,000 from the issuance of Series II Preferred, which
sources were partially offset by $32,297 in principal payments on notes payable.

                                       11
<PAGE>
                         ITEM 7. - FINANCIAL STATEMENTS

                          INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
                                                                          Page
                                                                          ----
<S>                                                                       <C>
Independent Auditors' Report...........................................   F-1

Consolidated Balance Sheets, December 31, 2003 and 2002................   F-2

Consolidated Statements of Operations for the years ended
  December 31, 2003 and 2002...........................................   F-3

Consolidated Statements of Shareholders' Equity for the years
  ended December 31, 2003 and 2002.....................................   F-4

Consolidated Statements of Cash Flows for the years ended
  December 31, 2003 and 2002...........................................   F-5

Notes to Consolidated Financial Statements for the years
  ended December 31, 2003 and 2002.....................................   F-6
</TABLE>

                                       12
<PAGE>

                          INDEPENDENT AUDITORS' REPORT

To The Shareholders
Crown NorthCorp, Inc. and Subsidiaries
Columbus, Ohio

We have audited the accompanying consolidated balance sheets of Crown NorthCorp,
Inc. and subsidiaries as of December 31, 2003 and 2002 and the related
consolidated statements of income, shareholders' equity, and cash flows for the
years then ended. These financial statements are the responsibility of Crown
NorthCorp, Inc. and subsidiaries' management. Our responsibility is to express
an opinion on these financial statements based on our audits. We did not audit
the 2003 consolidated financial statements of Crown NorthCorp Limited, a wholly
owned subsidiary operating principally in the United Kingdom, which statements
reflect total assets and revenues of 54% and 0%, respectively, of the related
consolidated totals. Those statements were audited by other auditors whose
report has been furnished to us, and our opinion, insofar as it relates to the
amounts included for Crown NorthCorp Limited and subsidiaries, is based solely
on the report of the other auditors.

We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform 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, based on our report and the report of other auditors, the
consolidated financial statements referred to above present fairly, in all
material respects, the financial position of Crown NorthCorp, Inc. and
subsidiaries as of December 31, 2003 and 2002, and the results of its operations
and its cash flows for the years then ended in conformity with accounting
principles generally accepted in the United States of America.

SCHOONOVER BOYER + ASSOCIATES

/s/

Columbus, Ohio
April 13, 2004

                                       F-1

<PAGE>

CROWN NORTHCORP, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 2003 AND 2002

<TABLE>
<CAPTION>
                                                                                    2003              2002
                                                                                    ----              ----
<S>                                                                              <C>               <C>
ASSETS
CURRENT ASSETS:
  Cash and cash equivalents                                                      $  2,052,065      $     17,332
  Accounts receivable                                                               2,405,456            34,582
  Prepaid expenses and other assets                                                   368,588            73,718
                                                                                 ------------      ------------

            Total current assets                                                    4,826,109           125,632

PROPERTY AND EQUIPMENT - Net                                                          111,747            17,709

RESTRICTED CASH                                                                       257,490           257,490

OTHER ASSETS
  Investment in partnerships and joint ventures                                       392,985                 -
  Other investments                                                                 1,939,589           742,381
  Loan servicing rights- net of accumulated amortization of $190,597 in 2003        7,017,674           583,710
     and $160,365 in 2002
  Capitalized software cost - net of accumulated amortization of $123,414           1,026,196           131,390
     in 2003 and $152,937 in 2002
  Acquisition costs                                                                     2,091
  Deposits                                                                             42,585             7,466
                                                                                 ------------      ------------
            Total other assets                                                     10,421,120         1,464,947
                                                                                 ------------      ------------
TOTAL                                                                            $ 15,616,466      $  1,865,778
                                                                                 ============      ============
LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES
  Current portion of long-term obligation                                           1,294,202            31,237
  Accounts payable                                                                    638,133           117,313
  Deferred revenue                                                                          -                 -
  Accrued expenses:
    Interest                                                                           10,688             4,769
    Other                                                                             884,875            46,546
                                                                                 ------------      ------------

            Total current liabilities                                               2,827,898           199,865

LONG-TERM OBLIGATIONS:
  Notes and bonds payable - less current portion                                      505,979           190,463
  Allowance for loan losses & other                                                   235,979           235,979
                                                                                 ------------      ------------
            Total long-term obligations                                               741,958           426,442

MINORITY INTEREST                                                                           -            90,154

SHAREHOLDERS' EQUITY:
  Common stock                                                                        152,501            40,949
  Additional paid-in capital                                                       20,058,116         8,924,278
  Accumulated comprehensive income                                                    114,231           113,305
  Accumulated deficit                                                              (8,101,180)       (7,862,162)
  Treasury stock, at cost                                                            (177,058)          (67,053)
                                                                                 ------------      ------------

            Total shareholders' equity                                             12,046,610         1,149,317
                                                                                 ------------      ------------

TOTAL                                                                            $ 15,616,466      $  1,865,778
                                                                                 ============      ============
</TABLE>

See notes to consolidated financial statements.

                                      F-2
<PAGE>

CROWN NORTHCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2002

<TABLE>
<CAPTION>
                                                                2003              2002
                                                                ----              ----
<S>                                                         <C>               <C>
REVENUES:
  Management fees                                           $    637,358      $    495,209
  Loan servicing fees, net                                       111,256           114,399
  Interest income                                                255,885            72,423
  Income from partnerships and joint ventures                      6,222            45,724
  Gain on sale of servicing rights                                     -                 -
  Other                                                            4,718            37,515
                                                            ------------      ------------
            Total revenues                                     1,015,439           765,270
                                                            ------------      ------------

OPERATING AND ADMINISTRATIVE EXPENSES:
  Personnel                                                      607,170           549,774
  Insurance, professional and other                              424,262           331,989
  Occupancy                                                      119,072            78,868
  Depreciation and amortization                                   58,023           148,217
  Minority interest in earnings of subsidiary                          0             5,999
                                                            ------------      ------------
            Total operating and administrative expenses        1,208,527         1,114,847
                                                            ------------      ------------

LOSS FROM CONTINUING OPERATIONS
 BEFORE INTEREST EXPENSE                                        (193,087)         (349,577)

INTEREST EXPENSE                                                  20,042             8,265
                                                            ------------      ------------

NET LOSS                                                        (213,129)         (357,842)

OTHER COMPREHENSIVE INCOME
 Unrealized Gain                                                     926            50,284
                                                            ------------      ------------

COMPREHENSIVE INCOME (LOSS)                                 $   (212,203)     $   (307,558)
                                                            ============      ============

LOSS PER SHARE - BASIC AND DILUTED                          $      (0.02)     $      (0.03)
                                                            ============      ============

WEIGHTED AVERAGE SHARES OUTSTANDING                           12,164,480        11,679,929
                                                            ============      ============
</TABLE>

See notes to consolidated financial statements.

                                      F-3
<PAGE>

CROWN NORTHCORP, INC. AND SUBSIDIARIES

 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
 FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2002

<TABLE>
<CAPTION>

                                                                                  Common Stock
                                                                                    Shares
                                                                                    Issued        Amount
                                                                                    -------       -------
<S>                                                                               <C>            <C>
BALANCE, DECEMBER 31, 2001                                                        12,222,851      35,748

       Net loss
       Accumulated comprehensive income
       Cumulative effect on prior earnings due to accounting change
       Issuance of common stock                                                      520,000       5,200
       Issuance of preferred stock

                                                                                 -----------------------
BALANCE, DECEMBER 31, 2002                                                        12,742,851      40,948

       Net loss
       Purchase accounting and audit adjustments                                                 (12,397)
       Purchase of Royal                                                          12,000,000     120,000
       Dividends paid
       Accumulated comprehensive income
       Purchase of minority interest
       Issuance of common stock                                                      395,000       3,950
       Net effect of reverse stock split/conversion                               (9,887,735)
                                                                                 -----------------------
BALANCE, DECEMBER 31, 2003                                                        15,250,116     152,501
                                                                                 =======================

<CAPTION>
                                                                                        Convertible Preferred Stock
                                                                        ----------------------------------------------------------
                                                                           Series CC           Series DD           Series EE
                                                                        ----------------------------------------------------------
                                                                        Shares             Shares              Shares
                                                                        Issued    Amount   Issued    Amount    Issued       Amount
                                                                        -------   ------   -------   -------   -------      ------
<S>                                                                     <C>       <C>      <C>       <C>       <C>          <C>
BALANCE, DECEMBER 31, 2001                                                    1                  1                  1

       Net loss
       Accumulated comprehensive income
       Cumulative effect on prior earnings due to accounting change
       Issuance of common stock
       Issuance of preferred stock                                                               -                  -
                                                                        --------------------------------------------------------
BALANCE, DECEMBER 31, 2002                                                    1        -         1       -          1          -

       Net loss
       Purchase accounting and audit adjustments
       Purchase of Royal                                                      -                 (1)
       Dividends paid
       Accumulated comprehensive income
       Purchase of minority interest
       Issuance of common stock
       Net effect of reverse stock split/conversion                          (1)                                   (1)
                                                                        --------------------------------------------------------
BALANCE, DECEMBER 31, 2003                                                    -        -         -       -          -          -
                                                                        ========================================================

<CAPTION>
                                                                                          Convertible Preferred Stock
                                                                                    -----------------------------------------
                                                                                         Series FF               Series GG
                                                                                    -----------------------------------------
                                                                                    Shares                   Shares
                                                                                    Issued       Amount      Issued    Amount
                                                                                    -------      -------     -------   ------
<S>                                                                                 <C>          <C>         <C>       <C>
BALANCE, DECEMBER 31, 2001                                                               1                        1

       Net loss
       Accumulated comprehensive income
       Cumulative effect on prior earnings due to accounting change
       Issuance of common stock
       Issuance of preferred stock                                                       -                        -
                                                                                  -------------------------------------------
BALANCE, DECEMBER 31, 2002                                                               1          -             1         -

       Net loss
       Purchase accounting and audit adjustments
       Purchase of Royal                                                                (1)
       Dividends paid
       Accumulated comprehensive income
       Purchase of minority interest
       Issuance of common stock
       Net effect of reverse stock split/conversion                                                              (1)
                                                                                  -------------------------------------------
BALANCE, DECEMBER 31, 2003                                                               -          -             -         -
                                                                                  ===========================================

<CAPTION>
                                                                                         Convertible Preferred Stock
                                                                                  -----------------------------------------
                                                                                      Series HH              Series II
                                                                                  -----------------------------------------
                                                                                  Shares                 Shares
                                                                                  Issued    Amount       Issued      Amount
                                                                                  -------   -------      -------     ------
<S>                                                                               <C>       <C>          <C>         <C>
BALANCE, DECEMBER 31, 2001                                                           15

       Net loss
       Accumulated comprehensive income
       Cumulative effect on prior earnings due to accounting change
       Issuance of common stock
       Issuance of preferred stock                                                    -                      12
                                                                                 --------------------------------------------
BALANCE, DECEMBER 31, 2002                                                           15        -             12          -

       Net loss
       Purchase accounting and audit adjustments
       Purchase of Royal                                                            (15)                    (12)
       Dividends paid
       Accumulated comprehensive income
       Purchase of minority interest
       Issuance of common stock
       Net effect of reverse stock split/conversion
                                                                                 --------------------------------------------
BALANCE, DECEMBER 31, 2003                                                            0        -              -          -
                                                                                 ============================================

<CAPTION>

                                                                                     Additional                     Accumulated
                                                                                     Paid-In       Accumulated     Comprehensive
                                                                                     Capital         Deficit          Income
                                                                                     --------        -------          ------

<S>                                                                                <C>             <C>             <C>
BALANCE, DECEMBER 31, 2001                                                          8,757,479      (7,420,525)

       Net loss                                                                                             -
       Accumulated comprehensive income                                                              (357,842)         63,020
       Cumulative effect on prior earnings due to accounting change                                   (83,795)         50,285
       Issuance of common stock                                                        46,800
       Issuance of preferred stock                                                    120,000
                                                                                   ------------------------------------------
BALANCE, DECEMBER 31, 2002                                                          8,924,279      (7,862,162)        113,305

       Net loss                                                                             -        (213,129)
       Purchase accounting and audit adjustments                                       12,397               -
       Purchase of Royal                                                           11,074,196               -
       Dividends paid
       Accumulated comprehensive income                                                                     -             926
       Purchase of minority interest                                                   11,694         (25,889)
       Issuance of common stock                                                        35,550
       Net effect of reverse stock split/conversion                                         -
                                                                                   ------------------------------------------
BALANCE, DECEMBER 31, 2003                                                         20,058,116      (8,101,180)        114,231
                                                                                   ==========================================

<CAPTION>

                                                                                                                   Total
                                                                                  Treasury Stock                 Shareholders'
                                                                                     Shares            Amount      Equity
                                                                                     ------            ------      ------

<S>                                                                               <C>                 <C>         <C>
BALANCE, DECEMBER 31, 2001                                                           (682,073)        (67,053)    1,305,649
                                                                                                                          -
       Net loss                                                                                                           -
       Accumulated comprehensive income                                                                            (244,537)
       Cumulative effect on prior earnings due to accounting change                                                 (83,795)
       Issuance of common stock                                                                                      52,000
       Issuance of preferred stock                                                                                  120,000
                                                                                 ------------------------------------------
BALANCE, DECEMBER 31, 2002                                                           (682,073)        (67,053)    1,149,317

       Net loss                                                                                                    (213,129)
       Purchase accounting and audit adjustments                                                                          -
       Purchase of Royal                                                           (1,125,803)       (110,005)   11,084,191
       Dividends paid                                                                                                     -
       Accumulated comprehensive income                                                                                 926
       Purchase of minority interest                                                                                (14,195)
       Issuance of common stock                                                             -               -        39,500
       Net effect of reverse stock split/conversion                                   613,866                             -
                                                                                 ------------------------------------------
BALANCE, DECEMBER 31, 2003                                                         (1,194,010)       (177,058)   12,046,610
                                                                                 ==========================================

</TABLE>

                                      F-4
<PAGE>

CROWN NORTHCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2002

<TABLE>
<CAPTION>
                                                                                                 2003           2002
                                                                                                 ----           ----
<S>                                                                                          <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net loss                                                                                   $   (213,129)   $   (357,842)
  Adjustments to reconcile net loss to net cash used in operating activities:
    Depreciation and amortization                                                                  92,687         183,238
    Equity in income from investment in partnerships and joint ventures                                 -         (45,724)
    (Gain) loss on disposal of equipment                                                           13,411           2,806
    Minority interest in earnings                                                                       -           5,999
    Deferred revenue                                                                                    -          (2,739)
    Payment of board of directors' fees by the issuance of common stock                            39,500          52,000
    Change in operating assets and liabilities: net of effects from purchase of subsidiary
      Accounts receivable                                                                          (1,492)         17,941
      Prepaid expenses and other assets                                                            (7,502)        (17,606)
      Accounts payable and accrued expenses                                                         8,077         (36,510)
                                                                                             ------------    ------------
            Net cash used in operating activities                                                 (68,448)       (198,437)
                                                                                             ------------    ------------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Purchase of property and equipment                                                             (124,945)         (1,115)
  Purchase of minority interest                                                                  (111,694)
  Increase in additional paid in capital                                                           11,694
  Net cash acquired in (paid for) corporate acquisition                                         1,984,480
  Distribution from D-Certificate                                                                  45,062           4,642
  Decrease (increase) in restricted cash                                                                -         259,692
  Increase in loan loss reserve                                                                         -        (264,021)
  Deposits                                                                                         (2,934)         (4,150)
                                                                                             ------------    ------------
            Net cash provided by (used in) investing activities                                 1,801,663          (4,952)
                                                                                             ------------    ------------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from notes payable                                                                     337,877         115,000
  Principal payments on notes payable                                                             (36,359)        (32,297)
  Issuance of common stock                                                                              -         120,000
                                                                                             ------------    ------------

            Net cash provided by (used in)  financing activities                                  301,518         202,703
                                                                                             ------------    ------------

NET INCREASE (DECREASE) IN CASH DURING THE PERIOD                                               2,034,733            (686)

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                                                   17,332          18,018
                                                                                             ------------    ------------

CASH AND CASH EQUIVALENTS AT END OF PERIOD                                                   $  2,052,065    $     17,332
                                                                                             ------------    ------------
SUPPLEMENTAL CASH FLOW INFORMATION

    Cash paid for interest                                                                   $     13,607    $      3,698
    Notes payable for settlement of general payables                                         $          -          53,997

Non-cash investing and financing activities

Corporate acquisition:
    Accounts receivable                                                                      $  2,369,382
    Prepaid expenses                                                                              287,369
    Property and equipment - net                                                                   38,362
    Investments                                                                                 2,554,485
    Loan servicing rights capitalized                                                           6,482,041
    Other Assets                                                                                  917,836
    Accounts payable and accrued expenses                                                      (1,361,992)
    Other long term debt                                                                       (1,271,963)
                                                                                             ------------
        Net assets acquired net of cash acquired                                               10,015,520

Amount financed
    Common stock - net of treasury shares                                                     (12,000,000)
                                                                                             ------------
        Net cash (acquired in) paid for acquisition                                          $ (1,984,480)
                                                                                             ============
</TABLE>

See notes to consolidated financial statements.

                                      F-5

<PAGE>

                     CROWN NORTHCORP, INC. AND SUBSIDIARIES

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

                 For the Years Ended December 31, 2003 and 2002

NOTE 1 - BUSINESS DESCRIPTION AND SIGNIFICANT ACCOUNTING POLICIES

         Principles of Consolidation

         The accompanying consolidated financial statements included the
         accounts of Crown NorthCorp and its majority-owned subsidiaries
         (collectively, the Company). Investments in majority-owned affiliates
         where the Company does not have a majority voting interest and
         non-majority owned affiliates are accounted for on the equity method.
         All significant intercompany balances and transactions have been
         eliminated.

         Business Description

         The Company is a financial services company providing comprehensive
         asset management and risk management services to owners and operators
         of commercial real estate interests. Assets managed are located
         throughout the United States and Europe and include commercial and
         residential real estate, performing and non-performing real estate and
         commercial loans, partnership investments and other miscellaneous
         assets. The Company also originates residential loans for
         non-conforming borrowers within the United Kingdom. The loans are
         simultaneously sold to investors with the servicing rights being
         retained by the Company.

         Cash and Cash Equivalents

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

         Accounts Receivable

         Accounts receivable are stated at the amount management expects to
         collect from outstanding balances. Management provides for probable
         uncollectible amounts through a charge to earnings and a credit to a
         reserve for uncollectible accounts, based upon its assessment of the
         current status of individual accounts. Balances that are still
         outstanding after management has used reasonable collection efforts are
         written off through a charge to the reserve account. Changes in the
         reserve have not been material to the financial statements.

         Depreciation

         Property and equipment are recorded at cost. Depreciation is computed
         using the straight-line method over estimated useful lives of three to
         five years.

                                      F-6
<PAGE>

                     CROWN NORTHCORP, INC. AND SUBSIDIARIES

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

                 For the Years Ended December 31, 2003 and 2002

NOTE 1 - BUSINESS DESCRIPTION AND SIGNIFICANT
         ACCOUNTING POLICIES - Continued

         Capitalized Software Costs

         The Company follows the accounting guidance as specified in Statement
         of Position ("SOP") 98-1, "Accounting for the Costs of Computer
         Software Developed or Obtained for Internal Use". The Company
         capitalizes significant costs in the acquisition or development of
         software for internal use, including the costs of the software,
         materials, consultants, interest and payroll and payroll-related costs
         for employees incurred in developing internal-use computer software
         once final selection of the software is made. Costs incurred prior to
         the final selection of software and costs not qualifying for
         capitalization are charged to expense.

         Loan Servicing Rights

         The Company records an asset upon the sale of a loan with servicing
         retained and allocates the cost of the loan to the servicing rights and
         to the loans based on their relative fair values. Fair values are
         estimated using discounted cash flows based on a current market
         interest rate. The resulting gain on sale of loans is included in
         mortgage origination. The Company also purchases mortgage servicing
         rights and records such rights at the cost to purchase.

         The cost of loan servicing rights is amortized in proportion to, and
         over the period of, estimated net servicing revenues. Impairment of
         loan servicing rights is assessed based on the fair value of those
         rights. The carrying amount of loan servicing rights approximates the
         fair value.

         Investments in Partnerships and Joint Ventures

         Certain of the Company's general partner and joint venture investments
         (ranging from 1% to 50%) are carried at cost, adjusted for the
         Company's proportionate share of undistributed earnings and losses
         because the Company exercises significant influence over their
         operating and financial activities.

         Other Investments

         During the first quarter of 2002 the Company made adjustments to its
         books to give effect to two changes in accounting method. The first
         adjustment was to consolidate a previously unconsolidated entity, CRS
         Bond Portfolio, L.P. ("CRS I"). CRS I is owned 50% by two Crown
         subsidiaries and 50% by an unrelated entity. One of the Crown entities
         is also CRS I's managing general partner. Since the Crown entities can
         be deemed to control CRS I it is appropriate that the financial
         statements of CRS I be consolidated into the financial statements of
         the Company. The adjustments made in the first quarter of 2002 to
         reflect this consolidation were an increase in cash of $907, an
         increase in the investment account of

                                      F-7
<PAGE>

                     CROWN NORTHCORP, INC. AND SUBSIDIARIES

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

                 For the Years Ended December 31, 2003 and 2002

NOTE 1 - BUSINESS DESCRIPTION AND SIGNIFICANT
         ACCOUNTING POLICIES - Continued

         Other Investments - Continued

         $77,136 and an increase in minority interest liability of $87,084.
         Effective January 2003, one of the Company's subsidiaries purchased the
         minority interest in CRS I. The purchase price of $100,000 was paid in
         two installments with the final installment being due in December 2003.

         The second adjustment was to change the method by which subsidiaries of
         the Company account for their investment in CRS I and CRS Bond
         Portfolio II L.P. ("CRS II"). These subsidiaries had previously
         accounted for their investment in CRS I and CRS II using the equity
         method. The characteristics of the sole asset of CRS I and CRS II, a
         residual interest in a securitization of tax-exempt bonds
         collateralized by multifamily projects ("Other investments"), have led
         management to view the investment as having two components: an
         amortizing semi-annual cash flow portion and an accreting real estate
         portion. The Company is now accounting for the cash flow component
         using the effective interest method as required by EITF 99-20.
         Management's estimate of the value of the accreting portion of the
         investment is $4,525,000, discounted to present value. The increase in
         the accreting portion of the investment will be reflected in
         comprehensive income in accordance with SFAS 130. The accounting
         entries to reflect these adjustments resulted in an increase in
         comprehensive income of $63,020 and a decrease in retained earnings of
         $83,795.

         During 2003, one of the multifamily projects collateralizing the
         tax-exempt bonds was sold. Consequently, management revised their
         estimate of the accreting portion of the investment to $3,760,000,
         discounted to present value.

         Reserve for Loan Losses

         The Company established an allowance for loan losses to provide for
         estimated losses in acquired mortgage portfolios serviced. The Company
         sold the mortgage portfolio in December 1999 (See Note 4). At the time,
         a reserve balance was established to offset losses incurred or
         sustained by the purchaser by reason of or associated with the mortgage
         loans. Charges against the reserve in 2003 and 2002 were $0 and
         $264,021, respectively.

         Income Taxes

         Deferred tax assets and liabilities are reflected at currently enacted
         income tax rates applicable to the period in which the deferred tax
         assets or liabilities are expected to be realized or settled. As
         changes in the tax laws or rates are enacted, deferred tax assets and
         liabilities are adjusted through the provision for income taxes.

                                      F-8
<PAGE>

                     CROWN NORTHCORP, INC. AND SUBSIDIARIES

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

                 For the Years Ended December 31, 2003 and 2002

NOTE 1 - BUSINESS DESCRIPTION AND SIGNIFICANT
         ACCOUNTING POLICIES - Continued

         Earnings Per Share of Common Stock

         As the Company incurred net losses in 2003 and 2002, there are no
         potential common shares to be included in the computation of diluted
         per-share amounts, in accordance with Statement of Financial Accounting
         Standards ("SFAS") No. 128 "Earnings per Share".

         Loan Servicing Fees

         Loan servicing fees are recognized as earned under the terms of the
         related servicing contract.

         Management Fees

         Management fees are recorded as services required under the contracts
         are performed, and are based on a percentage applied to the aggregate
         value of assets managed, as assigned in the contracts, or on original
         base monthly amounts, as defined in the contracts. Upon each
         disposition, withdrawal or addition of an asset or asset group, the
         management fee is adjusted to reflect the change in aggregate value of
         the assets. Management fees are calculated on a daily basis as set
         forth in the contracts.

         Disposition Fees

         Disposition and bonus fees, less retainages, are recorded as revenue
         when the disposition of an asset has been consummated and the gross
         proceeds from the disposition have been received by the asset owner.
         Disposition fees are generally based on a percentage of the proceeds of
         an asset disposition, as defined by the contracts, or a fixed amount
         per disposition.

         Incentive Fees

         Certain contracts provide for incentive fees if the Company achieves
         net cash collections in excess of thresholds established in the
         contracts. Upon substantial achievement of related thresholds,
         long-term contract revenues are recognized on the
         percentage-of-completion method based on assets realized relative to
         total contract assets, net of any anticipated losses. Billings for
         long-term contracts are rendered periodically, as permitted by contract
         terms.

         Mortgage Origination Fees

         The Company receives fees to originate and process certain loans. Upon
         closing the loan, the Company immediately sells the loan and recognizes
         origination fees as income.

                                      F-9
<PAGE>

                     CROWN NORTHCORP, INC. AND SUBSIDIARIES

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

                 For the Years Ended December 31, 2003 and 2002

NOTE 1 - BUSINESS DESCRIPTION AND SIGNIFICANT
         ACCOUNTING POLICIES - Continued

         Foreign Currency Translation

         Results of operations for the Company's non-U.S. subsidiaries and
         affiliates are translated from the designated functional currency to
         the U.S. dollar using average exchange rates during the period, while
         assets and liabilities are translated at the average monthly exchange
         rate in effect at the reporting date. Resulting gains or losses from
         translating foreign currency financial statements are reported as other
         comprehensive income (loss). The effect of changes in exchanges rates
         between the designated functional currency and the currency in which a
         transaction is denominated are recorded as foreign currency transaction
         gains (losses).

         Estimates

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

         Recently Issued Accounting Standards

         SFAS No. 149 "Amendment to Statement 133 on Derivative Instruments and
         Hedging Activities" was issued by the Financial Accounting Standards
         Board in April 2003. SFAS No. 149 amends and clarifies financial
         accounting and reporting for derivative instruments, including certain
         derivative instruments embedded in other contracts, and for hedging
         activities under SFAS No. 133. SFAS No. 149 is generally effective for
         contracts entered into or modified after June 30, 2003. The adoption of
         SFAS No. 149 on July 1, 2003 did not have any impact on the results of
         operations or financial position of the Company.

         SFAS No. 141 "Business Combinations" and SFAS No. 142 "Goodwill and
         Other Intangible Assets" were issued by the Financial Accounting
         Standards Board in July 2001. SFAS No. 141 requires that purchase
         method of accounting be used for all business combinations entered into
         after June 30, 2001. SFAS No. 142 changes the accounting for goodwill
         from an amortization method to an impairment only approach. Thus,
         amortization of goodwill, including goodwill recorded in past business
         combinations ceased upon SFAS No. 142, which for Company was January 1,
         2002. The adoption of this standard did not materially impact the
         Company's financial position, results of operations or cash flows.

                                      F-10
<PAGE>

                     CROWN NORTHCORP, INC. AND SUBSIDIARIES

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

                 For the Years Ended December 31, 2003 and 2002

NOTE 1 - BUSINESS DESCRIPTION AND SIGNIFICANT
         ACCOUNTING POLICIES - Continued

         Recently Issued Accounting Standards - Continued

         FAS No. 150 "Accounting for Certain Financial Instruments with
         Characteristics of both Liabilities and Equity" was issued by the
         Financial Accounting Standards Board in May 2003. SFAS No. 150
         establishes standards for the classification and measurement of certain
         freestanding financial instruments that embody obligations of the
         issuer and have characteristics of both liabilities and equity.
         Further, SFAS No. 150, requires disclosures regarding the terms of
         those instruments and settlement alternatives. As originally issued,
         the guidance in SFAS No. 150, was generally effective for financial
         instruments entered into or modified after May 31, 2003, and otherwise
         effective at the beginning of the first interim period beginning after
         June 15, 2003. The adoption of SFAS No. 150 on July 1, 2003 did not
         have any impact on the Company's results of operation or financial
         position.

         FIN No. 45 "Guarantor's Accounting and Disclosure Requirements for
         Guarantees - an interpretation of FASB Statements No. 5, 57 and 107 and
         rescission of FASB Interpretation No. 34" was issued by the Financial
         Accounting Standards Board in November 2002. FIN 45 requires a
         guarantor to provide more detailed interim and annual financial
         statement disclosures about obligations under certain guarantees it has
         issued. It also requires a guarantor to recognize, at the inception of
         new guarantees or modified after December 31, 2002, a liability for the
         fair value of the obligation undertaken in issuing the guarantee. The
         adoption of FIN 45 as of January 1, 2003 did not have a material impact
         on the financial position or results of operations of the Company.

         In December 2003, the FASB issued a revision to Interpretation No. 46,
         "Consolidation of Variable Interest Entities, an Interpretation of ARB
         No. 51", ("FIN 46R"), which was issued in January 2003. FIN 46R
         clarifies the application of ARB No. 51, "Consolidated Financial
         Statements," to certain entities in which equity investors do not have
         the characteristics of a controlling financial interest or do not have
         sufficient equity at risk for the entity to finance its activities
         without additional subordinated financial support. FIN 46R requires the
         consolidation of these entities, known as variable interest entities
         ("VIEs"), by the primary beneficiary of the entity. The primary
         beneficiary is the entity, if any, that will absorb a majority of the
         entity's expected losses, receive a majority of the entity's expected
         residual returns, or both. Among other changes, the revisions of FIN
         46R (a) clarified some requirements of the original FIN 46, which had
         been issued in January 2003, (b) eased some implementation problems,
         and (c) added new scope exceptions. FIN 46R deferred the effective date
         of the Interpretation for public companies, to the end of the first
         reporting period after March 15, 2004, except that all public companies
         must at minimum apply the provisions of the Interpretation to entities
         that were previously considered "special-purpose entities" under the
         FASB literature prior to the issuance of FIN 46R by the end of the
         first reporting period ending after December 15, 2003. During the year
         ended December 31, 2003, adoption of FIN 46R did not have a material
         impact on the Company's financial statements. (See Note 13).

                                      F-11
<PAGE>

                     CROWN NORTHCORP, INC. AND SUBSIDIARIES

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

                 For the Years Ended December 31, 2003 and 2002

NOTE 1 - BUSINESS DESCRIPTION AND SIGNIFICANT
         ACCOUNTING POLICIES - Continued

         Reclassifications

         Certain reclassifications of prior year amounts have been made to
         conform with current year presentation.

         Acquisitions

         Effective December 31, 2003, the Company acquired 100% of the issued
         and outstanding stock of Royal Investments Corp ("Royal") for
         12,000,000 shares of common stock of the Company. The acquisition was
         accounted for using the purchase method of accounting, and accordingly,
         the results of operations will be reflected in the financial statements
         from January 1, 2004 forward. Preliminarily, the net book value of the
         acquired assets and liabilities are considered to be fair value. Royal
         was a Delaware corporation whose sole shareholder was the Company's
         chairman and chief executive officer.

         The following unaudited pro forma consolidated results of operations
         have been prepared as if the acquisition had occurred at the beginning
         of 2003 and 2002:

<TABLE>
<CAPTION>
                                  2003                       2002
                                  ----                       ----
<S>                           <C>                        <C>
Revenue                       $ 11,875,202               $   14,353,801
Expenses                         8,885,669                    8,383,221
                              ------------               --------------
Net income                    $  2,989,533               $    5,970,580
                              ============               ==============

Earnings per share            $       0.21                         0.44
                              ============               ==============
</TABLE>

         The pro forma consolidated results do not purport to be indicative of
         results that would have occurred had the transactions been in effect
         for the periods presented, nor do they purport to be indicative of the
         results that will be obtained in the future.

NOTE 2 - PROPERTY AND EQUIPMENT AND CAPITALIZED SOFTWARE COSTS

         Property and equipment consists of the following at December 31:

<TABLE>
<CAPTION>
                                        2003                 2002
                                        ----                 ----
<S>                                <C>                   <C>
Furniture and equipment            $      272,234        $    513,005
Less accumulated depreciation            (160,487)           (495,296)
                                   --------------        ------------
Property and equipment - net       $      111,747        $     17,709
                                   ==============        ============
</TABLE>

                                      F-12
<PAGE>

                     CROWN NORTHCORP, INC. AND SUBSIDIARIES

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

                 For the Years Ended December 31, 2003 and 2002

NOTE 2 - PROPERTY AND EQUIPMENT AND CAPITALIZED
         SOFTWARE COSTS - Continued

         During 2003, the Company acquired $38,362 of furniture and equipment
         due to the merger with Royal Investments, Corp., a Delaware corporation
         ("Royal"). The fair value assigned to the furniture and equipment
         approximated the net carrying value of the fixed assets at the date of
         the acquisition. Accordingly, these costs have been included in
         Property and Equipment - net on the balance sheet.

         Capitalized software amortization expense was $42,483 and $53,902 for
         2003 and 2002, respectively. Capitalized software costs of $883,560
         were acquired in the merger of Royal. The fair value assigned to the
         capitalized software costs approximated the net carrying value of the
         capitalized software cots at the date of the acquisition. Accordingly,
         these costs have been included in Capitalized Software Costs on the
         balance sheet.

NOTE 3 - INVESTMENTS IN AFFILIATES AND JOINT VENTURES

         The Company has investments in affiliates that are accounted for using
         the equity method of accounting. The investments were acquired in the
         merger with Royal, effective December 31, 2003.

         TITRISATION BELGE-BELGISCHE EFFECTISERING SA/NV

         In October 2003, CMM acquired 75% of the shares in Titrisation
         Belge-Belgische Effectisering SA/NV "TBE" for 110% of the net asset
         value at September 30, 2003, approximately $532,300. Fortis Bank
         acquired their 25% share. CMM and Fortis agreed to jointly own TBE with
         a view of developing its master servicing business. Within a few days
         of the original transaction, CMM sold 25% of its share to Fortis for
         $177,434 thereby creating a 50/50 joint venture.

         Summarized condensed financial information of TBE, a 50% owned
         corporate joint venture accounted for by the equity method follows:

<TABLE>
<CAPTION>
<S>                                              <C>
Balance sheet at December 31, 2003
Assets:
   Current assets                                $845,165
Liabilities:
   Current liabilities                           $170,757
</TABLE>

                                      F-13
<PAGE>

                     CROWN NORTHCORP, INC. AND SUBSIDIARIES

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

                 For the Years Ended December 31, 2003 and 2002

NOTE 4 - DISCOUNTED OPERATIONS AND DISPOSITIONS

         In December 1999, the Company sold its portfolio of loans serviced
         under the Fannie Mae Delegated Underwriting and Servicing Program.
         Pursuant to the sale agreement, $500,000 was retained as a cash
         reserve, to offset losses incurred or sustained by the purchased by
         reason of or associated with the mortgage loans. These funds are to be
         held in an escrow account until all of the mortgage loans have been
         paid off. During 2002, the purchaser incurred losses in the portfolio
         of $264,021.

NOTE 5 - LONG-TERM DEBT

         Long term debt consists of the following at December 31:

<TABLE>
<CAPTION>
                                                                                2003           2002
                                                                                ----           ----
<S>                                                                          <C>            <C>
U.S. Promissory Note to majority shareholder, interest at 6% payable
quarterly, principal and accrued interest payable December 31, 2005          $   500,000    $   167,245

U.K. Promissory Note to majority shareholder, interest at 6% principal and
accrued interest payable December 31, 2004, if funds available                 1,271,964              -

U.S. Promissory Note, 6% interest, payable in monthly installments of
$1,514 including interest until April 1, 2005                                     23,217         39,455

U.S. Promissory Note, 6% interest, payable in quarterly installments of
$5,000 including interest until September 30, 2003                                 5,000         15,000
                                                                             -----------    -----------

                                                                               1,800,181        221,700
      Less: current maturities                                                (1,294,202)       (31,237)
                                                                             -----------    -----------

                                                                             $   505,979    $   190,463
                                                                             ===========    ===========
</TABLE>

                                      F-14
<PAGE>

                     CROWN NORTHCORP, INC. AND SUBSIDIARIES

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

                 For the Years Ended December 31, 2003 and 2002

NOTE 5 - LONG TERM DEBT - Continued

         Future debt maturities at December 31 are as follows:

<TABLE>
<CAPTION>
<S>                                    <C>
2004                                   $   1,294,202
2005                                         505,979
2006                                               -
2007                                               -
2008                                               -
Thereafter                                         -
                                       -------------
                                       $   1,800,181
                                       =============
</TABLE>

NOTE 6 - LEASES

         The Company, in its operations, leases office facilities located in
         Columbus, Ohio; Austin, Texas; and London, Ipswich and Farnham,
         England. All leases in effect at December 31, 2003, which expire on
         various dates through February 2010, have been classified as operating
         leases. Rent expense for the years ending December 31, 2003 and 2002
         was approximately $ 57,000 and $52,000 respectively.

         Minimum future rentals under these non-cancelable lease agreements are
         as follows:

<TABLE>
<CAPTION>
                Commitments      Sublease           Net
                -----------      --------           ---
<S>             <C>             <C>             <C>
2004            $ 198,844       $ (59,161)      $ 139,683
2005              198,918         (59,161)        139,757
2006              198,330         (59,161)        139,169
2007               94,298         (14,790)         79,508
2008               64,762               -          64,762
Thereafter         70,159               -          70,159
                ---------       ---------       ---------
                $ 825,311       $(192,273)      $ 633,038
                =========       =========       =========
</TABLE>

         The Company has entered into agreements to sublease office spaces that
         are included above. These sublease agreements were acquired as part of
         the merger with Royal and accordingly no rental income was recognized
         in the income statements during 2003 and 2002.

                                      F-15
<PAGE>

                     CROWN NORTHCORP, INC. AND SUBSIDIARIES

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

                 For the Years Ended December 31, 2003 and 2002

NOTE 7 - RELATED PARTY TRANSACTIONS

         MERGER TRANSACTION WITH ROYAL AND RELATED TRANSACTIONS

         Effective December 31, 2003, Crown acquired all of the issued and
         outstanding stock of Royal, of which Mr. Roark was the sole
         shareholder. Mr. Roark recused himself from all deliberations and votes
         of Crown's board of directors on the merger transaction. Royal operated
         through subsidiaries and affiliates, including but not limited to Crown
         NorthCorp Limited ("CNL") and Crown Mortgage Management ("CMM"),
         providing loan servicing and third-party asset management services for
         real estate-related assets in Europe. Through the merger transaction,
         Crown acquired these European operations.

         In conjunction with the merger transaction, Crown's board of directors
         has also authorized stock split transactions. (See Note 8).

         In exchange for all of the issued and outstanding stock of Royal, Mr.
         Roark received 12,000,000 shares of Crown's common stock. The principle
         followed in determining the amount of consideration was arm's length
         negotiation. The approximately 1,125,803 shares of Crown common stock
         held by Royal become treasury stock of Crown.

         Prior to the merger transaction, Royal distributed to Mr. Roark, as its
         sole shareholder, all of Royal's assets other than the Crown common
         stock held by Royal and Royal's ownership of all of the stock of CNL,
         which subsidiary conducts the European operations acquired by the
         company. Simultaneously, Mr. Roark assumed all of Royal's liabilities
         and indemnified Crown from any losses arising from Royal's operations.

         At the time of the merger transaction, Crown owed Royal $500,000 plus
         interest under an unsecured promissory note, representing operating
         funds Royal has advanced to Crown from time to time. Royal distributed
         this promissory note to Mr. Roark as described above so that Crown now
         owes this indebtedness to Mr. Roark personally. Crown and Mr. Roark,
         through arm's length negotiations, have revised the repayment terms.
         The indebtedness remains unsecured.

         Also at the time of the merger transaction, CMM owed Royal $1,271,964.
         Royal distributed this promissory note to Mr. Roark so that CMM now
         owes this indebtedness to Mr. Roark personally. (See Note 5).

         Royal owned one "B" preference share in Crown Properties Holding AB
         ("CPH"), entitling it to approximately 27% of the profit distribution
         from CPH. This preference share was another one of the assets
         distributed from Royal to Mr. Roark at the time of the merger. CMM has
         an asset management contract to manage the assets held by CPH. The
         incentive fee attainable under this contract may not exceed profits
         distributed to holders of preference shares, including Mr. Roark. (See
         Note 13).

                                      F-16
<PAGE>

                     CROWN NORTHCORP, INC. AND SUBSIDIARIES

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

                 For the Years Ended December 31, 2003 and 2002

NOTE 7 - RELATED PARTY TRANSACTIONS - Continued

         Mr. Roark and Crown, following arm's length negotiations, have entered
         into an employment contract calling for Mr. Roark to continue to serve
         as Crown's chairman and chief executive officer. The agreement, which
         is for a term expiring December 31, 2004, provides for a base salary of
         $100,000 plus incentive compensation.

         PREFERRED STOCK

         The company has issued the following series of convertible preferred
         stock to affiliates of Mr. Roark: one share of Series CC Convertible
         Preferred Stock in September 2000 in exchange for $500,000 cash; one
         share of Series DD Convertible Preferred Stock in May 2001 in exchange
         for $200,000 cash; one share of Series FF Convertible Preferred Stock
         in September 2001 in exchange for $335,803.70 cash; one share of Series
         GG Convertible Preferred Stock in September 2001 in exchange for
         $140,000; pursuant to an agreement effective September 20, 2001, a
         total of 15 shares of Series HH Convertible Preferred Stock in exchange
         for $150,000 cash; and, pursuant to an agreement effective March 27,
         2002, a total of 12 shares of Series II Convertible Preferred Stock in
         exchange for $120,000 cash. (See Note 8). Each of these issuances has
         been converted to common stock in accordance with the terms of the
         respective issuances.

         OTHER TRANSACTIONS AND RELATIONSHIPS

         In 2003, Crown's management asked Grace Jenkins, a member of the
         Company's board of directors, to perform certain tasks, including
         overseeing of an upgrade of the company's computer system and assisting
         in dealings with Midland Loan Services. During 2003, Crown paid Ms.
         Jenkins $70,000 for services rendered.

         Since January 2001, Crown has performed asset management activities for
         parties holding ownership interests in several multifamily projects
         that receive subsidies from the U.S. Department of Housing and Urban
         Development. Mr. Roark, or an affiliate of his, has partnership
         interests in substantially all of the projects for which Crown
         presently performs services. The rates and fees the company charges for
         its services are in accordance with HUD's guidelines and regulations
         where applicable. Unregulated rates and fees are at market levels.

         The company conducts some of its operations through joint ventures and
         partnerships and provides certain services to those entities.

                                      F-17
<PAGE>

                     CROWN NORTHCORP, INC. AND SUBSIDIARIES

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

                 For the Years Ended December 31, 2003 and 2002

NOTE 8 - SHAREHOLDERS' EQUITY

         At December 31, 2003 and 2002, the Company has 30,000,000 authorized
         shares of its $.01 par value common stock ("Common Stock") and
         1,000,000 authorized share of its preferred stock.

         On December 31, 2003, the holders of all seven outstanding issuances of
         Crown's preferred stock (Series CC, DD, EE, FF, GG, HH and II
         Convertible Preferred Stock) converted those issuances to Common Stock.
         The company has no preferred stock outstanding.

         During 2000 the Company entered into an employee termination agreement
         with various executive employees. As a result of that agreement the
         Company issued warrants entitling the holders to purchase, after
         accounting for the splits of the company's Common Stock effective
         December 31, 2003, up to 49,000 shares of common stock at $.70 per
         share. All of these warrants are exercisable.

         A stock option plan for the outside directors of the Company was
         approved by the Company's shareholders in 1995. Under the plan, each
         outside director may be granted options for 10,000 shares of the
         Company's common stock at an option price equal to the common stock's
         market value on the date of the grant. The options vest over a
         four-year period if the Company achieves certain stock price
         thresholds. No options have been granted as of December 31, 2003.

         The Company applies Accounting Principles Board ("APB") Opinion No. 25
         and related interpretations in accounting for its stock options.
         Application of this accounting policy would have had a negligible
         effect on the accompanying financial statements for 2003 and 2002.

NOTE 9 - BENEFIT PLANS

         The Company sponsors a defined contribution retirement plan for certain
         of its U.S. employees who had attained the age of 21 and had provided
         six months of service. The Company matches 25% of the first 4% of the
         employees' contributions and employer contributions were $2,425 and
         $1,812 in 2003 and 2002, respectively.

         The Company subsidiary in the United Kingdom sponsors a defined
         contribution retirement plan for its employees. The Company will match
         the employee's contributions to the plan up to a maximum of 5% per
         year. The plan is available to all full time employees. The Company
         contributed $53,253 and $50,379 during 2003 and 2002, respectively.

                                      F-18
<PAGE>

                     CROWN NORTHCORP, INC. AND SUBSIDIARIES

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

                 For the Years Ended December 31, 2003 and 2002

NOTE 10 - INCOME TAXES

         For the years ended December 31, 2003 and 2002, the components of
         income tax expense consisted of the following:

<TABLE>
<CAPTION>
            2003        2002
            ----        ----
<S>        <C>        <C>
Current    $    -     $     -
Deferred   $    -     $     -
</TABLE>

         The income tax (benefit) expense differs from the amount computed by
         applying the statutory federal income tax rate of 34% to pretax
         earnings (loss) from continuing operations as follows:

<TABLE>
<CAPTION>
                                               2003          2002
                                               ----          ----
<S>                                         <C>            <C>
Income tax benefit at statutory rate        $ (72,149)     $(104,570)
Amortization of loan servicing rights          (9,757)       (14,194)
Amortization of software                       (8,891)        (7,047)
Tax-exempt income                             (74,955)             -
Other, net                                         48            165
Comprehensive income                             (315)       (17,097)
Increase in valuation allowance               166,021        134,708
                                            ---------      ---------
Total income tax benefit                    $       -      $       -
                                            =========      =========
</TABLE>

At December 31, 2003 and 2002, the Company had recorded a net deferred tax asset
as follows:

<TABLE>
<CAPTION>
                                        2003             2002
                                        ----             ----
<S>                                  <C>              <C>
Assets
   Operating loss carry-forward      $ 2,800,398      $ 2,638,498
   Valuation allowance                (2,739,042)      (2,573,021)
                                     -----------      -----------
   Total assets                           61,534          132,245
                                     -----------      -----------

Liabilities:
   Deferred loan servicing               (55,405)         (91,303)
   Software amortization                  (5,949)         (41,042)
                                     -----------      -----------
         Total liabilities               (61,354)        (132,245)
                                     -----------      -----------

Net deferred tax asset               $         -      $         -
                                     ===========      ===========
</TABLE>

                                      F-19
<PAGE>

                     CROWN NORTHCORP, INC. AND SUBSIDIARIES

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

                 For the Years Ended December 31, 2003 and 2002

NOTE 11 - CONTINGENCIES

         The Company has certain contingent liabilities resulting from claims
         incident to the ordinary course of business. Management believes that
         the probable resolution of such contingencies will not materially
         effect the consolidated financial statements of the Company.

         The Company has certain contingent liabilities resulting from
         contractual requirements in the United Kingdom in regards to employment
         contracts acquired in the merger with Royal. Upon termination (but only
         in the event of redundancy, as defined under the employment laws of the
         United Kingdom), 11 employees may be entitled to receive severances
         based upon a formula taking into service years and weekly pay. The
         total payout is capped at a maximum two years of pay. At December 31,
         2003, this liability is approximately $647,000.

NOTE 12 - MORTGAGE SERVICING FOR OTHERS

         Mortgage loans serviced for others are not included in the accompanying
         consolidated balance sheets. The unpaid principal balances of mortgage
         loans serviced for others were approximately $3,970 million and $81
         million at December 31, 2003 and 2002, respectively. As of December 31,
         2003 the Company was also the standby servicer for loans with an
         aggregate unpaid principal balance of $3,095 million.

         Custodial escrow balances maintained in connection with the foregoing
         loan servicing, excluded from the accompanying consolidated balance
         sheet, were approximately $2 million and $1 million at December 31,
         2003 and 2002, respectively.

         Mortgage servicing rights of $7.2 million and $.6 million were
         capitalized as of December 31, 2003 and 2002, respectively.

NOTE 13 - VARIABLE INTEREST ENTITIES

         As of December 31, 2003, the Company has relationships with two
         variable interest entities where the Company is deemed not to be the
         primary beneficiary. In accordance with FIN 46, these two entities are
         not included in the consolidated financial statements.

         CROWN EUROPEAN HOLDINGS LIMITED

         In May 2003, Crown Properties Holding AB "CPH", Crown Fastighter AB,
         HVB Real Estate Investment Banking Limited, Bayerische Hypo-und
         Vereinsbank Aktiengesellschaft, Real Estate Scandinavia, Stockholm
         Branch, and certain other parties entered into a $79,000,000 facilities
         agreement.

                                      F-20
<PAGE>

                     CROWN NORTHCORP, INC. AND SUBSIDIARIES

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

                 For the Years Ended December 31, 2003 and 2002

NOTE 13 - VARIABLE INTEREST ENTITIES - Continued

         Royal and CNL used the above funds to purchase the entire issued share
         capital of Axfood Fastigheter AB from Axfood AB, a Swedish company that
         operates supermarket properties throughout Sweden. CNL contributed an
         additional $5,834,000 by way of $3,500,000 in equity in CPH and a
         subordinated loan of $2,300,000, originally advanced by Royal to CNL.

         In September 2003, CNL refinanced the majority of their investment in
         CPH by using $4,200,000 advanced from Kenmore Scandinavian, a Kenmore
         Properties Group company (a third party Scottish based property
         investment company). Crown European Holdings Limited ("CEH") used the
         funds to purchase the entire issued share capital of CPH and to acquire
         the subordinated loan by CNL to CPH. Kenmore's loan was secured by a
         debenture and they received 3 "A" preference shares carrying rights to
         the profit distribution from CPH in the proportion of their loans,
         approximately 73%. Royal received one "B" preference share with
         carrying rights to the profit distribution from CPH, approximately 27%.
         This share was transferred to Ronald E. Roark, the Company's Chairman,
         as part of the merger of Royal.

         In addition, CNL pledged its ordinary stock in CEH as additional
         security. Thus, Kenmore has the voting control of the ordinary share of
         CEH via the security agreement.

         The Crown group can earn income under an Asset Manager agreement in
         four ways:

                  1.       Annual management fee based as a percentage of the
                           asset value

                  2.       Approximately $13,600 per month to cover management
                           costs

                  3.       Subject to board approval, 1% of the gross sales
                           price of any assets sold

                  4.       Promote fee as a percentage of net distributions if
                           ROCE excess 20% per annum. However, the promote fee
                           will not exceed the amounts paid out in distributions
                           to Kenmore and Mr. Roark.

         The Servicing Agreement is deemed to be a variable interest. The Crown
         group has only its equity investment at risk in the CEH venture. The
         equity investment is one Pound Sterling. CMM is not deemed to be the
         primary beneficiary because of the significant rights and risks assumed
         by Kenmore pursuant to the transaction documents. Due to Kenmore's
         voting rights via the security agreement, Kenmore can terminate the
         Asset Manager agreement at any time. In addition, Kenmore must approve
         the operating budget, any capital expenditure, any disposals of assets,
         any borrowings, and any factoring or discounting of debt. Also, there
         is no financial recourse to CNL. And Kenmore, through the 73% preferred
         share dividend would absorb a majority of CEH's expected
         losses/residual returns.

                                      F-21
<PAGE>

                     CROWN NORTHCORP, INC. AND SUBSIDIARIES

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

                 For the Years Ended December 31, 2003 and 2002

NOTE 13 - VARIABLE INTEREST ENTITIES - Continued

         ROOFTOP MORTGAGES LIMITED

         In September 2003, Crown Asset Management Limited "CAM" formed a 100%
         owned corporation known as Rooftop Mortgages Limited "Rooftop". Rooftop
         has 1,000 common shares authorized at one Pound Sterling per share. At
         December 31, 2003 there is 1 share issued and outstanding which is
         owned by CAM.

         Rooftop operates as a sub-prime residential lender in England, Wales,
         Scotland and Northern Ireland and as such is a party to agreements for
         the origination and sale of loans. Pursuant to the terms of a Mortgage
         Warehouse Facility and related transaction documents Rooftop has agreed
         to transfer certain rights and transfer certain risks normally
         belonging to a stockholder under the terms of a Mortgage Sale
         Agreement, such that it would not be appropriate to fully consolidate
         Rooftop into the Crown group. CAM is not deemed to be the primary
         beneficiary because of the significant rights and risks transferred
         pursuant to the transaction documents. Examples of some of the rights
         of a stockholder that have been foregone are the right to transfer
         CAM's shares without prior consent, additional shares cannot be issued,
         Rooftop cannot engage in any other business and Rooftop cannot create
         any subsidiary companies without consent.

         Despite the restrictions that make consolidation inappropriate, the
         Crown group has a substantial financial interest in Rooftop and its
         business, by virtue of the servicing income to be generated for CMM,
         other fees generated from the loans originated that are payable by
         borrowers and profits to be generated from securitization of the loans
         originated. The Servicing Agreement is deemed to be a variable
         interest.

         Rooftop's ongoing operational costs are met from a $1,400,000 working
         capital facility provided by a Funder, which Rooftop's directors
         consider to be adequate for current and foreseeable requirements. There
         is no financial recourse to CAM related to this working capital
         facility. But, in the event of certain types of default defined in the
         transaction documents, CAM may become obliged to transfer the stock in
         Rooftop to the Funder for nominal consideration as collateral
         supporting the obligations to the Funder.

NOTE 14 - FAIR VALUE

         The Company is required to disclose the estimated fair value of its
         financial instruments in accordance with SFAS No. 107, "Disclosures
         about Fair Value of Financial Instruments." These disclosures do not
         attempt to estimate or represent the Company's fair value as a whole.
         The disclosure excludes assets and liabilities that are not financial
         instruments. The fair value amounts disclosed represent point-in-time
         estimates that may change in subsequent reporting periods due to market
         conditions and other factors. Estimated fair value amounts in theory
         represent the amounts for which financial instruments could be
         exchanged in transactions between willing parties.

                                      F-22
<PAGE>

                     CROWN NORTHCORP, INC. AND SUBSIDIARIES

                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

                 For the Years Ended December 31, 2003 and 2002

NOTE 14 - FAIR VALUE - Continued

         Estimated Fair values:

<TABLE>
<CAPTION>
                                                      2003                                  2002
                                          ------------------------------        -----------------------------
                                            Carrying          Estimated          Carrying          Estimated
                                             Value           Fair Value           Value            Fair Value
                                          -----------        -----------        -----------       -----------
<S>                                       <C>                <C>                <C>               <C>
Financial assets:
   Cash and other short term
         financial instruments            $ 2,309,554        $ 2,309,544        $   274,822       $   274,822
   Investments                                693,899            693,899            742,381           742,381
   Loans                                    3,650,851          3,650,851                  -                 -
   Allowance for losses                    (2,405,160)        (2,405,160)                 -                 -
   Servicing Rights                         7,017,674          7,017,674            583,710           583,710
Financial liabilities:
   Short term financial instruments         1,294,202          1,294,202             31,237            31,237
   Long term debt                             505,977            505,977            190,463           190,463
</TABLE>

                                      F-23
<PAGE>

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

None.

ITEM 8A. - CONTROLS AND PROCEDURES

Crown's principal executive and financial officers have evaluated the company's
disclosure controls and procedures in place on December 31, 2003 and have
concluded that they are effective. There have been no significant changes in
Crown's internal controls or in other factors since that date that could
significantly affect these controls.

                                    PART III

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

The company currently has four directors. All directors of the company hold
office until the next annual meeting of the stockholders and until their
successors have been duly elected and qualified. All officers of Crown do not
serve a term of years but serve at the pleasure of the Board of Directors.

The directors and executive officers of the company as of March 20, 2004 are as
follows:

<TABLE>
<CAPTION>
NAME                       AGE         POSITION WITH COMPANY
----                       ---         ---------------------
<S>                        <C>         <C>
Ronald E. Roark            54          Chairman, Chief Executive Officer and Director
Gordon V. Smith            71          Director
David K. Conrad            47          Director
Grace Jenkins              52          Director
Paul Morris                49          Managing Director of CMM
Peter Walker               40          Finance Director and Chief Operating Officer of CNL
Jonathan Naylor            48          Group Operations and Development Manager of CMM
David Scrivener            42          Secretary and Finance Manager of CNL
Rick Lewis                 50          Vice President, Treasurer and Chief Financial Officer of Crown
Stephen W. Brown           53          Secretary of Crown
</TABLE>

Set forth below are the principal occupations and affiliations during at least
the last five years of the directors and executive officers. All information is
as of March 20, 2004.

RONALD E. ROARK has served as Chairman of the Board of Directors of the company
since August 4, 1994 and as Chief Executive Officer since September 1, 2000. He
served as President of Royal and Managing Member of Tucker Holding Company, Ltd.
from 1995 to

                                       13
<PAGE>

December 31, 2003; since 1979, he has been President of Brookville
Associates, Inc.

GORDON V. SMITH has served as a director of Crown since October 1, 1996. He has
been Chairman of the Board of Miller and Smith Holding, Inc. since 1964. From
1985 to 1994, he served as Chairman and Chief Executive Officer of Providence
Savings and Loan Association, F.A. Mr. Smith has served as a director of Bank
Plus since 1996 and as its Chairman since 1998.

DAVID K. CONRAD has served as a director of Crown since January 5, 2000. Mr.
Conrad is a partner in the law firm of Bricker & Eckler LLP and has been
affiliated with that firm since 1980. The firm provides some legal services to
the company.

GRACE JENKINS has served as a director of Crown since October 30, 2000. From
February 2001 to April 2003, she served as IT Process Group Leader and Senior IT
Leader of American Electric Power. From March 6, 1997 until September 1, 2000,
she served as Executive Vice President of Crown. She served as a Vice President
of the company from September 13, 1994 to that date.

PAUL MORRIS has served as managing director of CMM since September 1999. Prior
to that time, he was founding director of Commercial Mortgage Systems and the
former managing director of Wilshire's servicing company in the United Kingdom.

PETER WALKER has served since 1998 as finance director and, since March 1999, as
chief operating officer of CNL. Prior to that, he served in the Corporate
Recovery Department of Ernst & Young.

JONATHAN NAYLOR has served as group operations and development manager for CNL
since September 2002. Prior to that time, he served as managing director of
Criterion Asset Management.

DAVID SCRIVENER has managed corporate and client reporting functions for CNL for
approximately twenty years and, since September 1999, has served as corporate
secretary and finance manager.

RICK LEWIS has served as the company's Treasurer and Chief Financial Officer
since September 1, 2000 and as Vice President since February 22, 2000. Since
1994, he has administered the company's loan servicing operations.

STEPHEN W. BROWN has served as Secretary of Crown since September 13, 1994 and
as Corporate Counsel since August 1996. Since March 1992, he has served Crown in
various asset management capacities and as a legal counsel.

                                       14
<PAGE>

Audit Committee Financial Expert

The company's board of directors has determined that Mr. Smith, an independent
director, serves as the Audit Committee financial expert.

Code of Ethics

Crown has adopted a code of ethics applicable to its principal executive,
financial and accounting officers. A copy of the code appears as an exhibit to
this report.

                                       15
<PAGE>

ITEM 10. - EXECUTIVE COMPENSATION

The following table sets forth information for the year ended December 31, 2003
with respect to Crown's Chief Executive Officer and the next four most highly
compensated executive officers other than the Chief Executive Officer.

<TABLE>
<CAPTION>
                                      YEAR ENDED                                    ALL OTHER
               NAME                   DECEMBER 31    SALARY         BONUS         COMPENSATION
               ----                   -----------    ------         -----         ------------
<S>                                   <C>           <C>            <C>            <C>
Ronald E. Roark,                         2003       $      0       $      0       $     10,000
Chairman and                             2002       $      0       $      0       $     10,000
CEO (1)                                  2001       $      0       $      0       $     10,000

Paul Morris, Managing Director of        2003       $163,464       $ 49,039       $          0
CMM                                      2002       $148,973       $ 75,125       $          0
                                         2001       $139,176       $      0       $          0

Peter Walker, Finance Director           2003       $125,867       $ 49,039       $          0
and Chief Operating Officer, CNL         2002       $114,002       $ 75,125       $          0
                                         2001       $105,560       $      0       $          0

Jonathan Naylor, Group Operations        2003       $147,118       $      0       $          0
and Development Manager, CNL             2002       $135,225       $      0       $          0

David Scrivener, Secretary and           2003       $ 83,366       $ 20,433       $          0
Finance Manager of CNL                   2002       $ 68,364       $ 30,050       $          0
                                         2001       $ 62,280       $  2,880       $          0

</TABLE>

(1)      Mr. Roark has served as Chairman of the company since August 4, 1994
         served as its CEO from September 13, 1994 through March 28, 2000 and
         again since September 1, 2000. The company pays family medical coverage
         premiums and disability insurance premiums on his behalf. Since June
         2000, Mr. Roark has drawn no salary from the company. In conjunction
         with the Royal merger transaction, Mr. Roark has entered into an
         employment agreement with the company providing for an annual salary of
         $100,000 plus incentive compensation based on Crown's earnings.

                                       16
<PAGE>

Each director is paid an annual retainer of $12,000, payable quarterly, $500 for
each meeting of the Board of Directors and $500 for each committee meeting
attended, plus expenses. The company makes retainer and attendance payments to
directors quarterly. At the company's election, payments are either in cash or
in the form of common stock based generally on the closing price of the common
stock on the last day of a quarter, with a floor price of $1.00 per share.

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

The following table sets forth security ownership information regarding the
common stock as of March 20, 2004 by: (i) each person known by the company to
own beneficially more than 5% of the shares of the common stock; (ii) each
director of the company; (iii) each of the executive officers of the company
named in Item 10 above and (iv) all directors and executive officers of the
company as a group. Except as otherwise noted below, each of the shareholders
identified in the table has sole voting and investment power over the shares
beneficially owned by each such shareholder. Also, unless otherwise indicated,
the address of each beneficial owner is in care of the company, 1251 Dublin
Road, Columbus, Ohio 43215.

<TABLE>
<CAPTION>
                                                   NUMBER OF SHARES      APPROXIMATE
           NAME                                    OF COMMON STOCK     PERCENT OF CLASS
           ----                                    ---------------     ----------------
<S>                                                <C>                 <C>
Ronald E. Roark                                       10,909,157            77.3%
Gordon V. Smith(1)                                       407,606             2.9%
Grace Jenkins(2)                                          62,000              (6)
David K. Conrad (3)                                       46,700              (6)
Paul Morris (4)                                          350,000             2.5%
Peter Walker (4)                                         350,000             2.5%
Jonathan Naylor (4)                                            0             n/a
David Scrivener (4)                                            0             n/a
Rick Lewis                                                70,000              (6)
Stephen W. Brown (5)                                      78,500              (6)
All directors and executive officers as a group       12,273,963            87.0%
(10 persons)
</TABLE>

(1)      Represents 353,739 shares held by Mr. Smith and 53,867 shares held by
         The Gordon V. and Helen C. Smith Foundation. The mailing address for
         both Mr. Smith and the Smith Foundation is c/o Miller and Smith
         Holding, Inc., 1568 Springhill Road, McLean, Virginia 22102. Mr. Smith,
         as president of the Smith Foundation, may be deemed the beneficial
         owner of such shares. Mr. Smith disclaims such beneficial ownership.

(2)      Represents ownership of 35,500 shares of common stock and warrants to
         acquire 26,500 shares of common stock at $.70 per share.

                                       17
<PAGE>


(3)      The mailing address for Mr. Conrad is c/o Bricker & Eckler LLP, 100
         South Third Street, Columbus, Ohio 43215. The shares are owned by
         Bricker & Eckler.

(4)      The mailing address for Messrs. Morris, Walker, Naylor and Scrivener is
         c/o CNL, Crown House, Crown Street, Ipswich, IP1, 3HS UK.

(5)      Represents ownership of 70,000 shares of common stock and warrants to
         acquire 8,500 shares at $.70 per share.

(6)      Less than 1%.

ITEM 12. - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

MERGER TRANSACTION WITH ROYAL AND RELATED TRANSACTIONS

Effective December 31, 2003, Crown acquired all of the issued and outstanding
stock of Royal Investments Corp, a Delaware corporation of which Mr. Roark was
the sole shareholder. Mr. Roark recused himself from all deliberations and votes
of Crown's board of directors on the merger transaction. Royal operated through
subsidiaries and affiliates, including but not limited to CNL and CMM, providing
loan servicing and third-party asset management services for real estate-related
assets in Europe. Through the merger transaction, Crown acquired these European
operations.

In conjunction with the merger transaction, Crown's board of directors
authorized stock split transactions. See Item "Item 5 - Market for Common Equity
and Related Stockholder Matters" above.

In exchange for all of the issued and outstanding stock of Royal, Mr. Roark
received 12,000,000 shares of Crown's common stock. The principle followed in
determining the amount of consideration was arm's length negotiation. The
approximately 1,125,803 shares of Crown common stock held by Royal became
treasury stock of Crown.

Prior to the merger transaction, Royal distributed to Mr. Roark, as its sole
shareholder, all of Royal's assets other than the Crown common stock held by
Royal and Royal's ownership of all of the stock of CNL, which subsidiary
conducts the European operations acquired by the company. Simultaneously, Mr.
Roark assumed all of Royal's liabilities and indemnified Crown from any losses
arising from Royal's operations.

At the time of the merger transaction, Crown owed Royal $500,000 plus interest
under an unsecured promissory note, representing operating funds Royal has
advanced to Crown from time to time. Royal distributed this promissory note to
Mr. Roark as described above so that Crown now owes this indebtedness to Mr.
Roark personally. Crown and Mr. Roark, through

                                       18
<PAGE>

arm's length negotiations, have revised the repayment terms. The indebtedness
remains unsecured.

Also at the time of the merger transaction, CMM owned Royal $1,271,964. Royal
distributed this promissory note to Mr. Roark so that CMM now owes this
indebtedness to Mr. Roark personally. See "Note 5 - Long-Term Debt - to the
Consolidated Financial Statements."

Royal owned one "B" preference share in Crown Properties Holding AB ("CPH"),
entitling it to approximately 27% of the profit distribution from CPH. This
preference share was another one of the assets distributed from Royal to Mr.
Roark at the time of the merger. CMM has an asset management contract to manage
the assets held by CPH. See "Note 13 - Variable Interest Entities - to the
Consolidated Financial Statements."

Mr. Roark and Crown, following arm's length negotiations, have entered into an
employment contract calling for Mr. Roark to continue to serve as Crown's
chairman and chief executive officer. The agreement, which is for a term
expiring December 31, 2004, provides for a base salary of $100,000 plus
incentive compensation.

PREFERRED STOCK

The company issued the following series of convertible preferred stock to
affiliates of Mr. Roark: one share of Series CC Convertible Preferred Stock in
September 2000 in exchange for $500,000 cash; one share of Series DD Convertible
Preferred Stock in May 2001 in exchange for $200,000 cash; one share of Series
FF Convertible Preferred Stock in September 2001 in exchange for $335,803.70
cash; one share of Series GG Convertible Preferred Stock in September 2001 in
exchange for $140,000; pursuant to an agreement effective September 20, 2001, a
total of 15 shares of Series HH Convertible Preferred Stock in exchange for
$150,000 cash; and, pursuant to an agreement effective March 27, 2002, a total
of 12 shares of Series II Convertible Preferred Stock in exchange for $120,000
cash. See "Note 8 - Shareholders' Equity - to the Consolidated Financial
Statements." Each of these issuances has been converted to common stock in
accordance with the terms of the respective issuances.

OTHER TRANSACTIONS AND RELATIONSHIPS

In 2003, Crown's management asked Ms. Jenkins to perform certain tasks,
including overseeing of an upgrade of the company's computer system and
assisting in dealings with Midland Loan Services. See Item "Item 3 - Legal
Proceedings" above. During 2003, Crown paid Ms. Jenkins $70,000 for services
rendered.

Since January 2001, Crown has performed asset management activities for parties
holding ownership interests in several multifamily projects that receive
subsidies from the U.S. Department of Housing and Urban Development. Mr. Roark,
or an affiliate of his, has partnership interests in substantially all of the
projects for which Crown presently performs services. The rates and fees the
company charges for its services are in accordance with

                                       19
<PAGE>

HUD's guidelines and regulations where applicable. Unregulated rates and fees
are at market levels.

The company conducts some of its operations through joint ventures and
partnerships and provides certain services to those entities.

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

The following exhibits are filed as part of this report:

<TABLE>
<CAPTION>
Exhibit
Number                  Exhibit                                              Method of Filing
------                  -------                                              ----------------
<S>         <C>                                                   <C>
3.3         Restated Certificate of Incorporation                 Incorporated by reference to
                                                                  Crown NorthCorp, Inc.'s Form 10-KSB filed March 31, 2000.

3.4         Bylaws                                                Incorporated by reference to Crown NorthCorp, Inc.'s
                                                                  Form 10-KSB filed March 31, 2000.

10.92       Agreement and Plan of Merger
            dated as of December 31, 2003 between
            Crown and Royal Investments
            Corp.                                                 Filed herewith.

10.93       Note Modification Agreement dated as
            of December 31, 2003 between Crown
            and Ronald E. Roark                                   Filed herewith.

10.94       Indemnification of Ronald E. Roark in
            favor of Crown                                        Filed herewith.

10.95       Employment Agreement between Crown
            and Ronald E. Roark dated as of January
            1, 2004                                               Filed herewith.

14.1        Code of Ethics                                        Filed herewith.

20.1        Audited consolidated financial statements
            of Crown NorthCorp Limited and subsidiaries
            as of December 31, 2003 and 2002.                     Filed herewith.

21.8        Subsidiaries of Crown NorthCorp, Inc.                 Filed herewith.

31.3        Certification of officers of Crown                    Filed herewith.

32.2        Certification of officers of Crown                    Filed herewith.
</TABLE>

                                       20
<PAGE>

b)       Reports on Form 8-K

         None

ITEM 14. - PRINCIPAL ACCOUNTANT FEES AND SERVICES

The firm of Schoonover Boyer + Associates has served as Crown's principal
accountant for each of the past two fiscal years. The Audit Committee of Crown's
Board of Directors approved the engagement of the firm prior to the commencement
of work. Fees billed by the firm for those periods are as follows:

<TABLE>
<CAPTION>
                           AUDIT-RELATED
           AUDIT FEES         FEES          TAX FEES       ALL OTHER FEES
           ----------         ----          --------       --------------
<S>        <C>             <C>              <C>            <C>
2002       $31,191             0            $ 4,355             0
2003       $62,113             0            $ 3,964             0
</TABLE>

                                       21
<PAGE>

                                   SIGNATURES

         Pursuant to the requirements of Section 13 or Section 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.

Date: April 14, 2004                       Crown NorthCorp, Inc.

                                           By: /s/ Ronald E. Roark
                                              ----------------------------------
                                               Ronald E. Roark, Chairman
                                               and Chief Executive Officer

         Pursuant to the requirements of 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.

Date: April 14, 2004                       By: /s/ Ronald E. Roark
                                               ---------------------------------
                                               Ronald E. Roark, Chairman and
                                                  Chief Executive Officer
                                               (Principal Executive Officer)

Date: April 14, 2004                           By: /s/ Rick L. Lewis
                                                  ------------------------------
                                                  Rick L. Lewis, Vice President,
                                                   Treasurer and Chief Financial
                                                   Officer
                                                  (Principal Accounting Officer)

Date: April 14, 2004                           By: /s/ Stephen W. Brown
                                                  ------------------------------
                                                  Stephen W. Brown, Secretary

Date: April 14, 2004                           By: /s/ David K. Conrad
                                                  ------------------------------
                                                   David K. Conrad, Director

Date: April 14, 2004                           By: /s/ Gordon V. Smith
                                                  ------------------------------
                                                   Gordon V. Smith, Director

Date: April 14, 2004                           By: /s/ Grace Jenkins
                                                  ------------------------------
                                                   Grace Jenkins, Director

                                       22
<PAGE>
                                INDEX TO EXHIBITS

3.3     Restated Certificate of Incorporation. (1)

3.4     Bylaws. (1)

10.92   Agreement and Plan of Merger dated as of December 31, 2003 between
        Crown and Royal Investments Corp. (2)

10.93   Note Modification Agreement dated as of December 31, 2003 between
        Crown and Ronald E. Roark. (2)

10.94   Indemnification of Ronald E. Roark in favor of Crown. (2)

10.95   Employment Agreement between Crown and Ronald E. Roark dated as of
        January 1, 2004. (2)

14.1    Code of Ethics (2)

20.1    Audited consolidated financial statements of Crown NorthCorp Limited and
        subsidiaries as of December 31, 2003 and 2002. (2)

21.8    Subsidiaries of Crown NorthCorp, Inc. (2)

31.3    Certification of officers of Crown (2)

32.2    Certification of officers of Crown (2)

------------
(1)      Incorporated by reference to Crown NorthCorp, Inc.'s Form 10-KSB filed
         March 31, 2000.

(2)      Filed herewith.