<PAGE>

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

                                  FORM 10-QSB

[X]  Quarterly Report under Section 13 or 15(d) of the Securities Exchange
     Act of 1934
     For the quarterly period ended March 31, 2001

[ ]  Transition Report under Section 13 or 15(d) of the Securities Exchange Act
     of 1934.
     For transition period from _____________ to ________________.

                      Commission File Number:   2-98014-D

                           NOVA COMMUNICATIONS LTD.
       (Exact name of small business issuer as specified in its charter)

             Nevada                                    95-4756822
     (State or other jurisdiction of                   (IRS Employer
     incorporation or organization)                    Identification Number)

                    3830 Del Amo Blvd., Torrance, CA 90503
                   (Address of principal executive offices)

        Issuer's telephone number including area code:   (310) 642-0200

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

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

Common stock: $.001 par value 18,603,622 shares outstanding at March 31, 2001.

Documents incorporated by reference:  None

Total sequentially numbered pages in this document: 19

                                       1
<PAGE>

                                     INDEX

                           NOVA COMMUNICATIONS LTD.


PART I.   FINANCIAL INFORMATION

Item 1    Financial Statements March 31, 2001 (unaudited) and December 31, 2000
           (audited)

          (a)  Consolidated Balance Sheets, March 31, 2001 and December 31,
               2000.

          (b)  Statements of Operations and Comprehensive Loss for the Three
               Months Ended March 31, 2001 and 2000.

          (c)  Statements of Cash Flows for the Three Months Ended March 31,
               2001 and 2000.

          (d)  Notes to Consolidated Financial Statements.

Item 2    Management's Discussion And Analysis Of Financial Condition And
          Results Of Operations

PART II.  OTHER INFORMATION

Item 5    Other Information

Item 6    Exhibits And Reports On Form 8-K

                                       2
<PAGE>

PART I.   FINANCIAL INFORMATION

Item 1    Financial Statements

                           NOVA COMMUNICATIONS LTD.

                          Consolidated Balance Sheets

<TABLE>
<CAPTION>
                                                                     March 31       December 31
                                                                       2001            2000
                                                                     --------       -----------
                                     ASSETS
                                     ------
<S>                                                                  <C>            <C>
Current assets:
 Cash                                                                $        -     $  422,203
 Accounts receivables, less allowance for uncollectible
  accounts of $74,526 in 2001 and $96,737 in 2000                       339,549        371,055
 Notes receivable                                                        70,652         85,632
 Inventories                                                            253,013        237,115
 Prepaid expenses and deposits                                           55,642         22,928
 Available-for-sale investments                                          87,000         87,000
                                                                     ----------     ----------
   Total current assets                                                 805,856      1,225,933

Equipment, net                                                          815,441        803,558

Other assets:
 Goodwill, less accumulated amortization of $244,179
  in 2001 and $124,357 in 2000                                        2,991,174      3,110,996
 Deposits                                                                67,078          3,063
                                                                     ----------     ----------
   Total other assets                                                 3,058,252      3,114,059
                                                                     ----------     ----------
                                                                     $4,679,549     $5,143,550
                                                                     ==========     ==========
</TABLE>

                            See accompanying notes.

                                       3
<PAGE>

                              NOVA COMMUNICATIONS

                    Consolidated Balance Sheets (continued)

<TABLE>
<CAPTION>
                                                                                March 31      December 31
                                                                                  2001            2000
                                                                              ------------    ------------
<S>                                                                           <C>             <C>
                 LIABILITIES AND STOCKHOLDERS' EQUITY
                 ------------------------------------
                             (DEFICIT)
                             ---------
Current liabilities:
 Checks issued in excess of cash on hand                                      $    126,711    $          -
 Accounts payable                                                                1,857,082       1,997,572
 Payable to related parties                                                         16,116          63,286
 Accrued payroll and payroll related liabilities                                    75,522          76,272
 Customer deposits                                                                 531,078         551,550
 Income taxes payable                                                                    -             800
 Other accrued liabilities                                                         211,203         244,995
 Long-term obligations, due within one year                                        887,965         174,454
                                                                              ------------    ------------
    Total current liabilities                                                    3,705,677       3,108,929

Long-term obligations                                                              448,741         932,465

Notes payable to related parties                                                   961,699       1,007,800

Commitments

Stockholders' equity (deficit):
 Preferred stock; no par value; authorized 10,000,000 shares                             -               -
 Common stock; $.001 par value; authorized 500,000,000 shares;
  outstanding 18,603,622 shares in 2001 and 2000                                    18,604          18,604
 Common stock to be issued                                                         371,953         371,953
 Additional paid-in capital                                                     11,936,794      11,842,912
 Retained deficit                                                              (12,353,162)    (11,728,356)
 Unrealized holding loss from available-for-sale
  investments                                                                     (410,757)       (410,757)
                                                                              ------------    ------------
    Total stockholders equity (deficit)                                           (436,568)         94,356
                                                                              ------------    ------------
                                                                              $  4,679,549    $  5,143,550
                                                                              ============    ============
</TABLE>

                            See accompanying notes.

                                       4
<PAGE>

                           NOVA COMMUNICATIONS LTD.

                Statements of Operations and Comprehensive Loss

<TABLE>
<CAPTION>
                                                                                   For The Three Months
                                                                                      Ended March 31
                                                                                   2001            2000
                                                                               -------------   ------------
                                                                               (Consolidated)
<S>                                                                            <C>             <C>
Revenues                                                                       $  1,580,673    $      4,980

Cost of revenues                                                                  1,112,037               -
                                                                               ------------    ------------

Gross margin                                                                        468,636           4,980

Operating expenses:
 Selling                                                                            138,990               -
 Operating                                                                          576,470               -
 General and administrative                                                         370,060          77,261
                                                                               ------------    ------------
    Total operating expenses                                                      1,085,520          77,261
                                                                               ------------    ------------

Loss from operations                                                               (616,884)        (72,281)

Other income (expenses):
 Loan fees                                                                                -         (38,330)
 Interest, net                                                                      (10,505)              -
                                                                               ------------    ------------
    Total other income (expenses)                                                   (10,505)        (38,330)
                                                                               ------------    ------------

Loss before provision (benefit) for income taxes                                   (627,389)       (110,611)

Provision (benefit) for income taxes                                                 (2,583)            800
                                                                               ------------    ------------

Net loss                                                                       $   (624,806)   $   (111,411)
                                                                               ============    ============


Net loss per common share                                                      $     (.0336)   $     (.0083)
                                                                               ============    ============

Net loss                                                                       $   (624,806)   $   (111,411)

Unrealized holding gain (loss) on available-for-sale investments                          -               -
                                                                               ------------    ------------

Comprehensive loss                                                             $   (624,806)   $   (111.411)
                                                                               ============    ============

Comprehensive loss per common share                                            $     (.0336)   $      (0083)
                                                                               ============    ============
</TABLE>

                            See accompanying notes.



                                       5
<PAGE>

                           NOVA COMMUNICATIONS LTD.

                           Statements of Cash Flows

<TABLE>
<CAPTION>
                                                                                                   For The Three Months
                                                                                                      Ended March 31
                                                                                                   2001             2000
                                                                                              --------------    -------------
                                                                                              (Consolidated)
<S>                                                                                           <C>               <C>
Cash flows from operating activities:
 Net loss                                                                                     $   (624,806)     $   (111,411)

 Adjustments to reconcile net loss to net cash used in operating activities:
   Depreciation and amortization                                                                   166,407             1,250
   Changes in assets and liabilities, net of effects of purchase of subsidiary:
    Receivables                                                                                     31,506           (15,989)
    Inventories                                                                                    (15,898)                -
    Prepaid expenses and deposits                                                                  (32,714)                -
    Investments                                                                                          -                10
    Checks issued in excess of  cash on hand                                                       126,711                 5
    Accounts payable                                                                              (140,490)           38,963
    Accrued liabilities                                                                           (102,984)           (7,951)
                                                                                              ------------      ------------
                                                                                                    32,538            16,288
Cash flows from investing activities:
 Principal repayments on notes receivable                                                           14,980            31,788
 Deposits                                                                                          (64,015)                -
 Capital expenditures                                                                              (58,468)                -
                                                                                              ------------      ------------
                                                                                                  (107,503)           31,788
Cash flows from financing activities:
  Proceeds from notes payable                                                                      246,679            61,505
  Principal payments on capitalized lease obligations                                              (16,892)                -
  Principal payments on notes payable to related parties                                           (46,101)           (1,382)
  Reduction of additional paid in capital                                                                -              (301)
  Additional paid-in-capital resulting from sale of
     common stock by subsidiary                                                                     93,882                 -
                                                                                              ------------      ------------
                                                                                                   277,568            59,822
                                                                                              ------------      ------------
 Net decrease in cash                                                                             (422,203)           (3,513)

 Cash at beginning of quarter                                                                      422,203             3,513
                                                                                              ------------      ------------

 Cash at end of quarter                                                                       $          -      $          -
                                                                                              ============      ============
</TABLE>

                            See accompanying notes.

                                       6
<PAGE>

                           NOVA COMMUNICATIONS LTD.

                  Notes to Consolidated Financial Statements
                                March 31, 2001


1.   Business and summary of significant accounting policies
     -------------------------------------------------------

     Business: Nova Communications Ltd. (the "Company" or "Nova") was
     --------
     incorporated under the laws of the State of Utah on March 25, 1985.
     Effective June 28, 1999, the Company changed its name from First Colonial
     Ventures, Ltd. to Nova Communications Ltd. and changed its state of
     incorporation from Utah to Nevada.  The Company invests in and provides
     managerial assistance to developing companies.

     Basis of consolidation: The consolidated financial statements include the
     ----------------------
     accounts of Nova and its subsidiaries, Communications 2000, Inc. and
     Kadfield, Inc.  All intercompany accounts and transactions have been
     eliminated.

     As of March 31, 2001, the Company owned 46.68% of Communications 2000, Inc.
     (46.86% at December 31, 2000), and Communications 2000, Inc. owned 100% of
     Kadfield, Inc.  These subsidiaries are consolidated because Management
     believes it exercises significant management influence over Communications
     2000, Inc. and Kadfield, Inc.

     Losses exceed the minority interest in the equity capital of Communications
     2000, Inc. and Kadfield, Inc.  Accordingly, losses applicable to the
     minority interest in Communications 2000, Inc. and Kadfield, Inc. are
     charged against Nova, as there is no obligation of the minority
     stockholders to guarantee such losses.  If future earning of Communications
     2000, Inc. and Kadfield, Inc. do materialize, Nova will be credited to the
     extent of such losses previously absorbed.

     Interim reporting: The Company's year-end for accounting and tax purposes
     -----------------
     is December 31.  In the opinion of management of the Company, the
     accompanying consolidated financial statements as of March 31, 2001 and for
     the three months then ended contain all adjustments, consisting of only
     normal recurring adjustments, except as noted elsewhere in the notes to the
     consolidated financial statements, necessary to present fairly its
     financial position, results of its operations and cash flows.  The
     consolidated results of operations for the three months ended March 31,
     2001 are not necessarily indicative of the results to be expected for the
     full year.

     Cash and cash concentrations: For purposes of the statement of cash flows,
     ----------------------------
     the Company and its subsidiaries consider cash equivalents to be highly
     liquid instruments with original due dates within three months of the date
     purchased.

     The Company and its subsidiaries place their cash in financial institutions
     and, at various times throughout the year, cash held in these accounts has
     exceeded Federal Deposit Insurance Corporation limits.  Neither the Company
     nor its subsidiaries have experienced any losses as a result of these cash
     concentrations.

                                       7
<PAGE>

                           NOVA COMMUNICATIONS LTD.

                  Notes to Consolidated Financial Statements
                                March 31, 2001

1.   Business and summary of significant accounting policies (continued)
     ------------------------------------------------------------------

     Equipment: Equipment is carried at cost.  Depreciation is computed using
     ---------
     the straight-line method over the estimated useful lives of the depreciable
     assets, which range from five to fifteen years.

     Computer software obtained or developed for internal use is capitalized in
     accordance with Statement of Position 98-1, "Accounting for the Cost of
     Computer Software Developed for Internal Use".  Amortization is computed
     using the straight-line method over seven years.

     Equipment under capitalized lease obligations is carried at estimated fair
     market value determined at the inception of the lease.  Amortization is
     computed using the straight-line method over the original term of the lease
     or the estimated useful lives of the assets, whichever is shorter.

     Goodwill: Goodwill represents the excess purchase price over the estimated
     ---------
     fair value of the net assets of its subsidiaries.  Amortization is computed
     using the straight-line method over seven years.

     Impairment of long-lived assets: The Company and its subsidiaries assess
     -------------------------------
     the recoverability of long-lived assets by determining whether the
     depreciation and amortization of the asset's balance over its remaining
     life can be recovered through projected undiscounted future cash flows.
     The amount of impairment, if any, is measured based on fair value and
     charged to operations in the period in which the impairment is determined
     by management.  Management has determined that there is no impairment of
     long-lived assets as of March 31, 2001 or December 31, 2000.

     Revenue recognition: Revenue from Nova's managerial assistance services is
     -------------------
     recognized when services are rendered.

     Communications 2000, Inc. routinely enters into contracts for the
     installation of its business communications systems. Revenue from these
     sales contracts is recognized under the percentage-of-completion method of
     accounting in the ratio that costs incurred bear to estimated total costs.
     Adjustments to cost estimates are made periodically, and losses expected to
     be incurred on contracts in progress are charged to operations in the
     period such losses are determined.  Revenue from service of business
     communications systems is recognized when services are rendered.

     Revenue from Kadfield, Inc.'s computer and electronic equipment sales is
     recognized when equipment is shipped to customers.

                                       8
<PAGE>

                           NOVA COMMUNICATIONS LTD.

                  Notes to Consolidated Financial Statements
                                March 31, 2001

1.   Business and summary of significant accounting policies (continued)
     ------------------------------------------------------------------

     Stock based compensation: The Company and its subsidiaries account for
     ------------------------
     stock based compensation under Statement of Financial Accounting Standards
     No. 123 ("SFAS 123).  SFAS 123 defines a fair value based method of
     accounting for stock based compensation.  However, SFAS 123 allows an
     entity to continue to measure compensation cost related to stock and stock
     options issued to employees using the intrinsic method of accounting
     prescribed by Accounting Principles Board Opinion No. 25 ("APB 25"),
     "Accounting for Stock issued to Employees".  Entities electing to remain
     with the accounting method of APB 25 must make pro forma disclosures of net
     income and earnings per share, as if the fair value method of accounting
     defined in SFAS 123 had been applied.  The Company has elected to account
     for its stock based compensation to employees under APB 25.

     Advertising:  The Company and its subsidiaries expense the cost of
     -----------
     advertising as incurred as selling expenses.  Advertising expenses were
     approximately $57,104 for the quarter ended March 31, 2001.

     Reporting comprehensive income: The Company and its subsidiaries report and
     ------------------------------
     display comprehensive income and its components as separate amounts in the
     consolidated financial statements.  Comprehensive income includes all
     changes in equity during a period that result from recognized transactions
     and other economic events other than transactions with owners.

     Income taxes: Income taxes are provided on the liability method whereby
     ------------
     deferred tax assets and liabilities are recognized for the expected tax
     consequences of temporary differences between the tax bases and reported
     amounts of assets and liabilities.  Deferred tax assets and liabilities are
     computed using enacted tax rates expected to apply to taxable income in the
     years in which temporary differences are expected to be recovered or
     settled.  The effect on deferred tax assets and liabilities from a change
     in tax rates is recognized in income in the period that includes the
     enactment date.  The Company and its subsidiaries provide a valuation
     allowance for certain deferred tax assets, if it is more likely than not
     that the Company or its subsidiaries will not realize tax assets through
     future operations.

     Segment reporting: The Company and its subsidiaries report information
     -----------------
     about operating segments and related disclosures about product and
     services, geographic areas and major customers in annual and interim
     consolidated financial statements under Statement of Financial Accounting
     Standards No. 131, "Disclosures about Segments of an Enterprise and Related
     Information".  Operating segments are defined as components of an
     enterprise for which separate financial information is available that is
     evaluated regularly by Management in deciding how to allocate resources and
     in assessing performance.

                                       9
<PAGE>

                           NOVA COMMUNICATIONS LTD.

                  Notes to Consolidated Financial Statements
                                March 31, 2001

1.   Business and summary of significant accounting policies (continued)
     ------------------------------------------------------------------

     Net loss per common share: Net loss per common share is computed by
     -------------------------
     dividing net loss by the weighted average number of common shares
     outstanding during the period.  The weighted average number of common stock
     shares outstanding was 18,603,622 for 2001 (13,381,500 for 2000).
     Preferred stock is not considered to be a common stock equivalent.  Common
     stock to be issued is not considered to be a common stock equivalent as the
     effect on net loss per common share is anti-dilutive.

     Concentration risk: The Company grants credit to customers primarily in the
     ------------------
     states of California and Florida.  The Company's ability to collect
     receivables is affected by economic fluctuations in the geographic areas
     served by the Company.

     Significant risks and uncertainties: The process of preparing financial
     -----------------------------------
     statements in conformity with generally accepted accounting principles
     requires the use of estimates and assumptions regarding certain types of
     assets, liabilities, revenues and expenses.  Management of the Company has
     made certain estimates and assumptions regarding the collectibility of
     notes receivable, net realizable value of inventories and estimated fair
     value of investments.  Such estimates and assumptions primarily relate to
     unsettled transactions and events as of the date of the financial
     statements.  Accordingly, upon settlement, actual results may differ from
     estimated amounts.

2.   Operations
     ----------

     The Company's continued existence is dependent upon its ability to obtain
     profitable operations and until then its ability to obtain additional
     capital.  The Company has experienced recurring losses and has a negative
     working capital.

     During 2000, Nova acquired control of two developing companies and
     management believes that with their managerial assistance they will be able
     to improve operating efficiencies and ultimately achieve profitability.

     The financial statements do not reflect adjustments relating to the
     recorded asset amounts, or the amounts of liabilities that would be
     necessary should the Company not be able to continue in existence.

                                       10
<PAGE>

                           NOVA COMMUNICATIONS LTD.

                  Notes to Consolidated Financial Statements
                                March 31, 2001

3.   Business combination
     --------------------

     Effective October 1, 2000, Nova acquired Communications 2000, Inc., dba
     TEC-networks ("TEC-networks") in a business combination accounted for as a
     purchase.  TEC-networks supplies, installs and services business
     communications systems, including computer networking and voice, data and
     voice-over-the-Internet communications and has operations in Southern
     California, Northern California, and Tampa, Florida.  Its customers are
     located primarily in California and Florida.  Prior to the business
     combination, the principal stockholder of TEC-networks was a stockholder of
     Nova and Nova was providing management services to TEC-networks.

     Also effective October 1, 2000, TEC-networks acquired 100% of the
     outstanding common stock of Kadfield, Inc ("Kadfield") in a business
     combination accounted for as a purchase.  Kadfield is a supplier of
     computer and electronic equipment and its customers are located nationwide.

     The results of operations of TEC-networks and Kadfield are included in the
     accompanying consolidated financial statements beginning October 1, 2000.
     The following pro forma summary presents consolidated financial position
     and results of operations as if TEC-networks and Kadfield had been acquired
     as of the beginning of Nova's 2000 fiscal year:

                               Three Months Ended March 31
                               ---------------------------
                                  2001             2000
                               ----------       ----------
      Net sales                $1,580,673       $1,133,632
      Net loss                   (624,806)        (291,876)
      Loss per common share        (.0336)          (.0218)

     The above amounts are based upon certain assumptions and estimates, which
     the Company believes are reasonable.  The pro forma financial position and
     results of operations do not purport to be indicative of the results which
     would have been obtained had the business combination occurred as of
     January 1, 2000 or which may be obtained in the future.

                                       11
<PAGE>

                           NOVA COMMUNICATIONS LTD.

                  Notes to Consolidated Financial Statements
                                March 31, 2001

4.   Investments
     -----------

     All of the Company's investments are considered by Management to be
     available-for-sale investments.  The following is a summary of investment
     securities:

                                          March 31    December 31
                                            2001          2000
                                         ---------    -----------
          Corporate securities:
            Amortized cost               $ 497,757      $ 497,757
            Gross unrealized losses       (410,757)      (410,757)
                                         ---------      ---------
              Estimated fair value       $  87,000      $  87,000
                                         =========      =========

     The Company's available-for-sale investments consist of the following
     Corporate Securities:

      Gulf Coast Hotels, Inc. ("Gulf Coast"): In December 1994, the Company
      --------------------------------------
      purchased the rights to 50% of Gulf Coast, a company incorporated under
      the laws of the State of Nevada.  Gulf Coast was formed to purchase the
      rights to approximately 1.4 acres in Biloxi, Mississippi and to develop a
      high-rise condominium hotel on that site. Gulf Coast has been unable to
      raise the approximately $1,000,000 necessary to complete the down payment.
      The seller has provided extensions to Gulf Coast, however the agreement is
      in default.  During 1997, Gulf Coast entered into agreements to sell its
      interest in the property and to become a minority partner in the
      development project subject to the majority partners obtaining financing.

      Management of Nova has determined that its investment in Gulf Coast had no
      value based upon the uncertainty of the outcome of Gulf Coast's default.

      Legal Club: In March 1996, the Company acquired an interest in Legal Club,
      ----------
      which was incorporated under the laws of the State of Florida.  Legal Club
      started a new nationwide membership organization providing access to
      attorney services at discounted rates.  In September 1998, Legal Club
      became a publicly traded company.

      The value of the Company's investment in Legal Club was determined based
      upon the closing bid price of its common stock on December 31, 2000.

                                       12
<PAGE>

                           NOVA COMMUNICATIONS LTD.

                  Notes to Consolidated Financial Statements
                                March 31, 2001

5.   Equipment
     ----------

     Equipment consisted of the following:

<TABLE>
<CAPTION>
                                              March 31     December 31
                                                2001          2000
                                             ----------    -----------

  Office furniture and equipment             $  491,586    $  443,181
  Computer software                             261,750       261,750
  Vehicle                                         7,400         7,400
  Marketing equipment                           192,467       192,467
  Leasehold improvements                        245,655       233,341
                                             ----------    ----------
                                              1,198,858     1,138,139
  Less accumulated depreciation                (383,417)     (334,581)
                                             ----------    ----------
   Equipment, net                            $  815,441    $  803,558
                                             ==========    ==========

6.   Long-term obligations
     ---------------------

     Long-term obligations consisted of the following:       March 31          December 31
                                                               2001               2000
                                                           -----------         -----------
  <S>                                                      <C>                 <C>
  Note payable and accrued interest payable to PFK
   Development Group, secured by 337,500 shares
   of Legal Club stock, borrowings bear interest
   at 10% per annum, borrowings and accrued
   interest are due December 2002.                         $  623,891          $  608,878
  Other notes payable                                         195,561              93,813
  Capitalized lease obligations                               517,254             404,228
                                                           ----------          ----------
                                                            1,336,706           1,106,919

  Less principal due within one year                         (887,965)           (174,454)
                                                           ----------          ----------
    Long-term obligations                                  $  448,741          $  932,465
                                                           ==========          ==========
</TABLE>

     Aggregate minimum future lease payments under capitalized leases are as
     follows for the years ending subsequent to March 31, 2001:

   Years ending March 31:
   ----------------------
          2002                                                       $  165,856
          2003                                                          245,650
          2004                                                          117,350
          2005                                                          117,694
          2006                                                           46,489
                                                                     ----------
  Total minimum lease payment                                           693,039
  Less amount representing interest                                    (175,785)
                                                                     ----------
  Present value of minimum future lease payments                     $  517,254
                                                                     ==========

                                       13
<PAGE>

                           NOVA COMMUNICATIONS LTD.

                  Notes to Consolidated Financial Statements
                                March 31, 2001

7.   Notes payable to related parties
     --------------------------------

     Notes payable to related parties consisted of the following:

<TABLE>
<CAPTION>
                                                                       March 31                  December 31
                                                                         2001                       2000
                                                                       --------                  -----------
  <S>                                                                  <C>                       <C>
  Note payable to Palaut Management, Inc. in
   exchange for management consulting services,
   unsecured and non-interest bearing, due June 2003.
   Palaut Management, Inc. is controlled by close
   family members of a stockholder of Nova.                            $625,000                  $   625,000

  Note payable to a stockholder and officer of the
   Company, unsecured, non-interest bearing, and due
   on demand.  This individual has agreed not to
   demand repayment of the note before March 2002.                      336,699                      382,800
                                                                       --------                  -----------
       Notes payable to related parties                                $961,699                  $ 1,007,800
                                                                       ========                  ===========
</TABLE>

8.   Commitments
     -----------

     The Company leases various facilities, equipment, and vehicles under non-
     cancelable operating lease agreements that expire between the years 2001
     and 2005.  Aggregate minimum future lease payments under these leases are
     approximately as follows:

        Years ending March 31:
        ----------------------
                2002                                                  $149,853
                2003                                                   152,240
                2004                                                   152,904
                2005                                                    82,226
                                                                      --------

        Total minimum lease payments                                  $537,223
                                                                      ========

Lease expense aggregated approximately $32,528 for the three months ended March
31, 2001.

                                       14
<PAGE>

                           NOVA COMMUNICATIONS LTD.

                  Notes to Consolidated Financial Statements
                                March 31, 2001

10.  Income taxes
     ------------

     The components of the provision (benefit) for income taxes are as follows:

                                                        March 31    March 31
                                                          2001        2000
                                                        --------    --------

 Federal Income Tax refund                              $ (2,583)   $
 State of California                                                     800
                                                        --------    --------

   Currently provision (benefit)                        $ (2,583)   $    800
                                                        ========    ========

11.  Other related party transactions
     --------------------------------

     The Company has entered into an agreement with a company for management
     consulting services.  The management company is controlled by close family
     members of a stockholder of Nova.  The agreement expires in June 2003 with
     renewal provisions.  Under the terms of the agreement, the Company is
     obligated to pay the management company $205,000 per year.

12.  Segment information
     -------------------

     The Company considers its operations to be in three segments, each of which
     are strategic businesses that are managed separately because each business
     sells or provides distinct products and services.  The segments are as
     follows:  managerial assistance to developing companies; sale, installation
     and service of business communications systems, including computer
     networking and voice, data and voice-over-the-Internet communications; and
     sale of computer and electronic equipment.

     Financial information by business segment is as follows:

<TABLE>
<CAPTION>
                                                                Computer
                                                Business           and
                                Managerial    communication    electronic       Total
                                assistance       systems        equipment     segments
                                -----------   --------------   -----------   -----------
                                           Three Months Ended March 31, 2001
                                --------------------------------------------------------
<S>                             <C>           <C>              <C>           <C>

      Revenues                   $     486       $1,237,206     $ 342,981    $1,580,673
      Loss from operations        (103,204)        (291,621)     (102,237)     (497,062)
      Identifiable assets          184,956        1,133,255       370,164     1,688,375
      Capital expenditures               -           58,469             -        58,469
      Depreciation and
       amortization                  1,262          150,331        14,814       166,407
</TABLE>

                                       15
<PAGE>

                           NOVA COMMUNICATIONS LTD.

                  Notes to Consolidated Financial Statements
                                March 31, 2001

12.  Segment information (continued)
     -------------------------------

<TABLE>
<CAPTION>

                                                                      Computer
                                                        Business         and
                                       Managerial    communication   electronic    Total
                                       assistance       systems      equipment    segments
                                       -----------   -------------   ----------   ---------
                                                  Three Months Ended March 31, 2000
                                       ----------------------------------------------------
<S>                                    <C>           <C>             <C>          <C>
Revenues                                 $  4,980     $          -   $        -   $  4,980
Loss from operations                      (72,281)               -            -    (72,281)
Identifiable assets                       387,719                -            -    387,719
Capital expenditures                            -                -            -          -
Depreciation                                1,250                -            -      1,250
</TABLE>

     Reconciliation of the segment information to the consolidated balances for
     loss from operations, total assets, and depreciation and amortization are
     as follows:

<TABLE>
<CAPTION>
                                    For The Three Months
                                       Ended March 31
                                   2001             2000
                                ----------        --------
<S>                             <C>               <C>
Segment loss from operations    $ (497,062)       $(72,281)
Amortization of goodwill          (119,822)              -
                                ----------        --------
 Consolidated loss from
  operations                    $ (616,884)       $ (72,28
                                ==========        ========
</TABLE>
<TABLE>
<CAPTION>
                                 March 31         March 31
                                   2001             2000
                                ----------        --------
<S>                             <C>               <C>
Segment identifiable assets     $1,688,375        $387,719
Goodwill, net                    2,991,174               -
                                ----------        --------
 Consolidated total assets      $4,679,549        $387,719
                                ==========        ========
</TABLE>
<TABLE>
<CAPTION>
                                    For The Three Months
                                       Ended March 31
                                   2001             2000
                                ----------        --------
<S>                             <C>               <C>
Segment depreciation and
 amortization                   $   46,585        $  1,250
Amortization of goodwill           119,822               -
                                ----------        --------
 Consolidated depreciation
  and amortization              $  166,407           1,250
                                ==========        ========
</TABLE>

                                       16
<PAGE>

Item 2    Management's Discussion And Analysis Of Financial Condition And
          Results Of Operations

     Management's discussion and analysis should be read in conjunction with the
financial statements and the notes thereto.

RESULTS OF OPERATIONS

     These results include the operations of the Company and its consolidated
subsidiaries for the three months ended March 31, 2001.   For the three months
ended March 31, 2000, the Company operated as a holding and investment company.

     Effective October 1, 2000 as discussed in Note 3 "Business Combinations" to
the above financial statements, Nova acquired Communications 2000, Inc., dba
TEC-networks ("TEC-networks") in a business combination accounted for as a
purchase.   Also effective October 1, 2000, TEC-networks acquired 100% of the
outstanding common stock of Kadfield, Inc ("Kadfield") in a business combination
accounted for as a purchase.

     As a result of these acquisitions,  revenues and expenses have increased
significantly in a comparison of operations for first quarter 2001 with first
quarter 2000.

Net loss, comprehensive loss, net loss per common share and comprehensive loss
per common share

     Net loss and comprehensive loss for the three months ended March 31, 2001
was $(624,806), a loss increase of $513,395 compared with a loss of $(111,411)
for the same three months of 2000.  As a result, net loss per share and
comprehensive loss per share for the three months ended March 31, 2001 was
$(.0336), a loss increase of $.0253 per share compared with a loss of $(.0083)
for the same three months of 2000.

Revenues

     Net revenues for the three months ended March 31, 2001 were $1,580,673, an
increase of $1,575,693 compared with $4,980 for the same three months of 2000.
Net revenues increased as a result of consolidation of the Company's
subsidiaries after their acquisition on October 1, 2000.

Cost of revenues and gross margin

     Cost of revenues for the three months ended March 31, 2001 was $1,112,037,
or 70.4% of net revenues. Gross margin for the three months ended March 31, 2001
was $468,636, an increase of $463,656 compared with $4,980 for the same three
months of 2000.

                                       17
<PAGE>

Operating expenses

     Operating expenses for the three months ended March 31, 2001 were
$1,085,520, an increase of $1,008,259 compared with $77,261 for the same three
months of 2000.  Operating expenses increased as a result of consolidation of
the Company's subsidiaries after their acquisition on October 1, 2000.

Other income (expenses)

     Net interest expense for the three months ended March 31, 2001 was $10,505
compared with $0 for the same three months of 2000.  Net interest expense
increased as a result of consolidation of the Company's subsidiaries after their
acquisition on October 1, 2000.  Loan fees were incurred in the three months
ended March 31, 2000 from the borrowings under notes payable.


PART II.       OTHER INFORMATION

Item 5         Other Information
               None

Item 6         Exhibits And Reports On Form 8-K

(a)            Exhibits

Exhibit
Number         Description of Document

3(3)(i)(1)     First Colonial Ventures, Ltd. Articles of Incorporation - March
               25, 1985 (Incorporated by reference)

3(3)(i)(2)     First Colonial Ventures, Ltd. Amendment to Articles of
               Incorporation - August 12, 1985 (Incorporated by reference)

3(3)(i)(3)     First Colonial Ventures, Ltd. Amendment to Articles of
               Incorporation- September 3, 1985 (Incorporated by reference)

3(3)(i)(4)     First Colonial Ventures, Ltd. Amendment to Articles of
               Incorporation - February 3, 1992 (Incorporated by reference)

3(3)(ii)(1)    Bylaws  (Incorporated by reference)


(b)            No reports on Form 8-K where filed during the period covered by
               this report.

                                       18
<PAGE>

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


May 4, 2001


     /s/ Kenneth D. Owen
----------------------------
Kenneth D. Owen                   President and Director



May 4, 2001


     /s/ Leslie I. Handler
-------------------------------
Leslie I. Handler                 Assistant Secretary and Director



May 4, 2001


     /s/ Bryce Sherwood
----------------------------
Bryce Sherwood                    Director

                                       19